Agenda item

REVISED Internal Audit Programme 20/21

NHowcutt introduced two new members to committee, Phillip Lazanby – Head of Internal Audit and Jonathan Sims - Senior Auditor who will be working closely with Group Managers. 

NHowcutt handed over to PLazanby who personally introduced himself as Director of Audit at TIAA, living in Dacorum with a background of more than 20 years primarily in public sector but also private.

PLazanby then went on to present the plan, directing committee members to pg.110 which sets out the plan for the next year, with six audits to be delivered by end of Qtr2.  He added that it might be fair to anticipate some slippage due to current COVID-19 situation, however it is intended they will progress as planned and will escalate any delays to NHowcutt.   Will commence delivery as soon as the plan is approved.

He highlighted the first key area is key financial controls, looking at financial ledger.  Typically a topic in every Council that is audited and something Jonathan is familiar with auditing at various Councils.

Second key area is budgetary control – gives a window into how the organisation works.  The level of financial assurance received from speaking to previous auditor and looking at external audit gives general sense everything is in place at Dacorum.

Cllr Townsend asked; does budgetary control include capital programme?

PLazanby responded at high level only, a scoping document would be required to look at that in any detail.

Cllr Townsend responded that his concern is around the fact slippage is generally around capital projects.

NHowcutt commented that there are generally two types of slippage in these programmes; acceptable slippages due to unexpected issues out of our control such as an archaeological find etc.  Unacceptable slippages are where a contractor runs over excessively, which we have to respond to.  It is generally expected that there will be slippages for capital projects and hence they will have a contingency applied to their project.

Cllr Birnie commented this could in part be something that must be affected by COVID-19 and ability to get on to sites.  However, with regard contractors running over, that is down to selection of contractors which forms a part of governance which we have always had a green light on, so he does not see this would be a high concern.

PLazanby gave an overview that the remaining areas would focus on Council Tax, NMDR (Business Rates), Housing Benefits & Business Rates.  Then moving on to operational risks, such as business continuity including pandemic arrangements.  Also Planning, Housing Rents and Empty Homes.  There are also a number of strategic topic such as GDPR to be looked at.

Cllr Townsend referred to Planning and the extent to which we audit the consultation and decision making process, expressing that residents have expressed valid concerns that decisions are made by officers when they have not received the correct information, for example information from HCC on roads.  He asked; will the audit cover these sort of questions?  To what extent will it delve into the governance?

PLazenby responded they would start by looking at complains and concerns raised and if that is a concern that is apparent then would anticipate it would be included in this report.

Cllr Townsend asked; before we embark on that internal audit, do we as the committee get to review your plan of attack, or will we just be presented the outcomes?

NHowcutt responded the report circulated with the agenda sets out the plan, one of the key elements is communication with stakeholders.  He added that he would be happy to meet with Cllr Townsend to ensure any elements he wants to see factored into the scope of future audits are included.

Cllr Birnie asked to be included in that meeting between Cllr Townsend and NHowcutt.

PLazanby advised the report needs full approval in order for them to commence work.

Cllr Syminton commented that this a very interesting piece of work, and asked NHowcutt; how does this plan compare with previous Internal Audit?  Is the cost comparison a consideration?

NHowcutt responded that when procurement process for internal audit was undertaken, cost was included in scope but was not the main driver.  Confidence in delivery and outcomes was the main driver so that the reports being completed are something we can hold up and be confident about.  Costs very similar to previous provider.  Scope of work follows on from what we were doing with Mazars.  The big expectation Is that we fulfil our full 2020 audit programme despite the obstacles and hurdles presented by current COVID-19 situation.

Cllr Townsend commented that on reading the agenda he could find no cover sheet to indicate Members are being asked be approve this, which he commented he is happy to do, but if we are being asked to approve something there should be a cover sheet setting out what we are being asked to do.

NHowcutt responded that the point has been noted.

Cllr Silwal referred to GDPR and asked; following exit from EU, will that continue or be replaced? 

PLazanby responded that he expects GDPR to continue and not be replaced by Data Protection Act.  Do think there will be an impact in short and medium term in passing around of information due to COVID-19, people will need to make pragmatic decisions.