Agenda item
Quarterly Internal Audit Assurance Report
- Meeting of Replaces Postponed meeting 11 December 2012, Audit Committee, Monday, 14th January, 2013 7.00 p.m., NEW (Item 5.1)
- View the background to item 5.1
To note the report and to take account of the assurance opinion assigned to the systems reviewed during the period.
Minutes:
The Head of Risk Management and Audit informed the Committee that the report covered the period September - November 2012 in which time 15 audits were completed. Three of these were assigned limited assurance and 12 substantial assurance. He advised that all priority one recommendations had been implemented and three priority two recommendations remained outstanding at the time of the follow-up.
In response to questions from the Committee, the following matters were discussed:
It was confirmed that sufficient time had been allowed to complete the plan barring unexpected events because the timings of the audits had been planned in advance. The Council was presently on target to deliver the plan. All preparations were in hand and the participants had been alerted.
The Committee was satisfied to learn that there had been no nil assurances and queried why no full assurances had been achieved. Members were advised that this was because the standard was high and full assurances would be assigned only when systems were considered sufficiently robust to assure delivery of their objectives. The Head of Risk Management and Audit noted that most audits had returned substantial assurances and advised that the Council aimed to perform within this range. Should an audit return a ‘fail’, an investigation would be considered.
Limited assurance levels had been returned for Tower Hamlets Homes (THH), contractors financial accounts-systems audit. The Director of Finance and Customer Services, THH advised that the audit had indicated some areas of need concerning capital contracts. He advised that membership of the contracts group would be reviewed for conflicts of interest. Also the final account audit would ensure that all sums were reconciled. Following the audit outcome there has been work on the capital manual and a follow-up audit will be undertaken to ensure that all recommendations have been implemented. Tower Hamlets Homes was presently looking into commissioning external auditors to undertake this work. The Director confirmed that he was confident that the recommendations would be implemented as implementation of the measures to remedy the limited assurances identified was ahead of schedule. In considering whether THH lacked risk awareness in the areas that returned limited assurance, the Director advised that the audit was a system audit and therefore officers with who were aware of the issues would be tasked to deal with them and also would be involved in the discussion. He further advised that the issue was not so much around risk awareness but concerned acknowledging conflicts of interests around the group. The Head of Legal Services, Environment also advised that since THH had a small workforce it was necessary to avoid ruling out participation by those with expertise. She therefore suggested that it would be more prudent for those evaluating the audit to declare an interest rather than to remove themselves from the audit.
The Head of Risk Management and Audit advised the Committee that a full confirmed that audits in the following year would explore how the Council managed its final accounts process.
The Head of Risk Management and Audit advised the Committee that that a satisfactory response had not been received from Sir John Cass school in regard to the limited assurance returned following the audit of management and control of school meals income. Therefore the Council had agreed a new process be followed in the management and control of school meals income and cash handling. Accordingly a follow up audit was due to be undertaken.
It was confirmed that the recommendations around the medium-term financial plan given at appendix 3 had been implemented.
RESOLVED
That the report be noted
Supporting documents:
- 5.1 Quarterly Assurance Report for DMT v2, item 5.1 PDF 89 KB
- 5.1a Quarterly Assurance Appxs, item 5.1 PDF 121 KB