The report of the Interim Audit Service Manager is attached.

Contact:  Katie Williams 07584 217067

The Committee received the report of the Interim Audit Service Manager – copy attached to the signed minutes - which provided Members with the proposed risk based Internal Audit Plan for 2023/24.  The Interim Audit Service Manager drew attention to paragraph 7.3 of the report which gave a brief description of the approach taken to create the audit plan, which was risk assessed and reviewed annually.  She highlighted the challenges facing the Council including roll out of the Shropshire Plan.  The approach taken was similar to that of the previous year whereby there was a core plan and a call off list that gave the ability to respond in an agile way as things changed.

The Interim Audit Service Manager took Members through the Appendices.  Appendix A showed that there were 1,398 days available for internal audit with 199 days for external clients.  She explained the process for matching resources against the risk, and drew attention to those high-risk areas, set out in Appendix B, which would not be audited this year and which were areas that Members may wish to seek first line assurance.  There were also areas of low risk which would also not be audited.  She was happy that the plan gave enough coverage to provide a year end opinion whilst responding to the level of change anticipated this year and provided 64% for planned audits and 36% for any unplanned work (from the call off list).   The Interim Audit Service Manager then highlighted the key points in paragraph 7.13.

In response to concerns around the significant changes within the team including the retirement of the Head of Audit and several other resignations, the Executive Director of Resources (Section 151 Officer) reported that following the retirement of the Head of Audit, two experienced auditors had been appointed as Interim Audit Service Managers and that a Head of Policy and Governance role was currently being recruited to and it was hoped to have someone in place within the next few months.  Officers confirmed that they were not concerned about the reasons for the resignations within the team and that some of those officers remained within the Council.

A brief discussion took place around the ability of the Committee to request Managers for any areas of concern to provide assurances directly to them (Paragraph 7.11).  The Executive Director of Resources (Section 151 Officer) explained that this was a question for the Committee, and he gave an example of where, in their role as Members, issues may come to their attention, for example PFIs, where they felt further assurances were required especially in those areas that would not be guaranteed an audit in the next twelve months.  If Committee Members had any particular concerns these should be raised with the Chairman or the Interim Audit Service Manager who could request the relevant manager to come to a future meeting or it could be covered by way of a training topic.  Members felt that PFIs were a good example and requested that it be included as a topic on the next training session.

Members were concerned around the 10% reduction of full-time equivalent posts appointed to (10 of the 12 currently in the establishment) and whether the two vacant posts would be filled, along with the reduced number of days available for planned audits and wished those concerns to be recorded.  In response, the Interim Audit Service Manager explained that there was not a minimum number of days before internal audit became ineffective as it was just part of the overall risk and obviously as the risk increased, they needed to ensure they had the minimum level of cover in order to provide assurance.  The Executive Director of Resources (Section 151 Officer) went on to say that it was a complicated risk assessment whereby balance and professional judgment came in to play.  He gave assurance that there were no plans to reduce the number of full-time equivalent posts within the establishment.

RESOLVED:

To note the approach taken to create the proposed Internal Audit Plan for 2023/24 and to approve its adoption.