Agenda item

The circulated report of the Head of Internal Audit and Counter Fraud was received in relation to the Internal Audit Progress Report. Appended to the report was the Internal Audit Progress Report for September 2021.

The report provided the committee with a progress update on the work of the Internal Audit team and the key findings from audits completed to date.

The Internal Audit service is delivering against the schedule of work presented to the Audit and Governance Committee at the meeting on 12 July 2021.  This plan of work is subject to ongoing review and prioritisation to ensure it focuses on the Council’s key risks.  During the year to date all assignments planned for the first quarter have been completed and have either been finalised or are in advanced stages of delivery or clearance at the time of reporting.  Good progress is being made on progressing quarter two audit work, although some assignments have been delayed to co-ordinate with other developments and work underway in the respective service areas.

The reason for the recommendation was for the Committee to exercise its duties and responsibilities within its Terms of Reference for receiving reports from the Internal Audit service and considering the main issues arising.

The Head of Internal Audit and Counter Fraud presented the report referring to sections in the Internal Audit Progress Report. She informed the committee that the timing of the safeguarding audit had been slightly postponed, but this was a deliberate change as a new Assistant Director had been recently appointed and this was being scoped to commence in October. The Head of Internal Audit and Counter Fraud also referred to the positive counter fraud activity and the work of the Counter Fraud team with the Fraud Hub.

Members raised concerns regarding the bank reconciliations for the former East Northamptonshire Council and Corby Borough Council. The Executive Director of Finance (s151 Officer) stated that she was equally disappointed, but this was progressing with speed. The Chair responded that these Councils are now demised and we now control our environment and this highlighted the importance of Internal Audit. The Executive Director of Finance (s151 Officer) added that a report was being taken to the Executive to bring Internal Audit back inhouse to North Northamptonshire Council as it was currently provided by a number of different organisations collectively.

In light of the bank reconciliations a Councillor commented that we need assurance that the systems are effective now. The Head of Internal Audit and Counter Fraud responded that they would continue to follow up on the recommendations until they were fully satisfied that the work was completed. The Executive Director of Finance (s151 Officer) will support the Head of Internal Audit and Counter Fraud to make necessary changes to keep to deadlines and to achieve changes.

A Councillor remarked that he takes comfort that officers know what they are doing, and the committee has to work with officers and Internal and External Auditors.

Neil Harris (Ernst & Young – External Audit) commented that the bank reconciliations of East Northamptonshire Council and Corby Borough Council will be a significant contrast to the control environments of Kettering Borough Council and the Borough Council of Wellingborough around their bank reconciliations.

The Executive Director of Finance (s151 Officer) reported that they are putting in processes to clear up the back log and for their own professional integrity want accounts presenting correctly.

The Chair summarised that officers are aiming to resolve the problem and that any weaknesses will need addressing.

The recommendation contained in the report was duly MOVED by Councillor Richard Levell and SECONDED by Councillor Ian Jelley. On being put to the vote this was carried.

RESOLVED that:-

(i)        The Audit and Governance Committee note the Internal Audit Progress Report for September 2021.