The report of the Head of Audit is attached.

Contact:  Ceri Pilawski (01743) 257739

75.1  The Committee received the report of the Head of Audit – copy attached to the signed Minutes – which provided Members with an update of work undertaken by Internal Audit in the three months since the previous Audit Committee report.

75.2  The Head of Audit informed the Committee that 79% of the revised plan had been achieved, however the team were on target to deliver 90% of the plan by year end.  She drew attention to performance against the plan 2019/20 set out on page 103.  There had been minor revisions to the plan for a total of 2,217 days (compared to 2,250 days reported in December).  In total, 18 final reports had been issued.

75.3  The Head of Audit drew Members’ attention to the Audits completed since October, the Assurance levels awarded and the overall spread of recommendations set out in paragraphs 6.6, 6.7 and 6.8 respectively.  Turning to paragraph 6.9, the Head of Audit reported that there had been 12 good or reasonable assurances accounting for 66% of the opinions delivered, which was a slight decrease compared to the previous year.  This was offset by a corresponding increase in limited and unsatisfactory assurances up from 33% in the previous year to 34% this year.

75.4  The Head of Audit explained that one fundamental recommendation had been identified, which was detailed in paragraph 6.13 of the report including the response from management.  Turning to Direction of Travel, the Head of Audit cautioned that the lower level assurances and the higher proportion of areas attracting unsatisfactory and limited assurances were an early indication of a weakening control environment.

75.5  A brief discussion ensued in relation to the control environment in which Members expressed their concerns.  In response, the Head of Audit stated that although it was a concern, she needed to see what happened in the last quarter before deciding on her opinion.  In response to a query about why processes were not being followed, the Head of Audit explained that it was not just around supply contracts but arrangements for compliance checks and managing contracts going forward. 

75.6  The Director of Finance, Governance and Assurance (Section 151 Officer) acknowledged that this was a risk but that any areas of non-compliance were reported directly to the Chief Executive.  In response to a query, the Director of Finance, Governance and Assurance (Section 151 Officer) explained that the Commissioning and Assurance Board had been set up two years ago to monitor strategic risks in relation to contract management.  He explained that staff had been trained and were aware of their responsibilities in these areas and that there was oversight by senior officers.

75.7  Members requested more information around Contracts to be presented to a future meeting of the Committee.

75.8 RESOLVED:

a)    That the performance todate againstthe2019/20Audit Plansetout in this report be endorsed and that the action to be taken by the Audit Committee in responseto thelow assurance levels andfundamental recommendations as detailedin thereport, be noted.

b)    That the adjustments required to the2019/20plan as reported in paragraph 6.3 of the report to take account of changing priorities set out inAppendixB be endorsed.

c)    That the Committee’s concerns about the adverse Direction of Travel be noted.