Agenda item

Internal audit provides an independent and objective opinion on the Authority’s risk management, governance, and control environment by evaluating its effectiveness.

Cllr Mandy Chilcot raised the point that the Progress Update Report (Agenda Item 5) and the Opinion Report (Agenda Item 6) from SWAP were exceedingly similar. Alastair Woodland, Assistant Director SWAP Internal Audit Services, explained that the reports contained the same information, however, the Opinion Report gave an overview of how well governance risk and control had worked throughout Somerset County Council (SCC) during 2022-23.

Alastair Woodland, Assistant Director SWAP Internal Audit Services, presented his report of Internal Audit Activity highlighting the internal audit plan agreed by the SCC Audit Committee in March 2022.  Appendix D provided details on the progress made to date and any new work agreed.  He commented that there were recommendations overdue. Mr Woodland confirmed that they would follow up on those recommendations with management to affirm they have been implemented and the risks in those areas had been reduced.

Alastair Woodland further noted that there were 4 reviews not yet finalised. These would be brought forward and included in the 23-24 Audit Plan for Somerset Council.

He noted that there were medium risk rated weaknesses, some isolated high risk weaknesses, but no critical weaknesses. It was further affirmed that 63% of the recommendations that were followed up were implemented and that SWAP were broadly satisfied with the results.

Alastair Woodland then went through the significant Corporate Risks for the 2022-23 year and noted that the reports which had not previously been finalised due to the legacy councils coming to an end, namely the Athena Contract and Climate Emergency: Governance Arrangements. These would be circulated to the Committee Members after the meeting. The Committee would then consider the reports and, if necessary, bring them to the next meeting agenda.

He further went through the significant strategic risks for the 2022-23 year and noted that they were in conformance with the public sector auditing standards.

Alastair Woodland confirmed that the two outstanding recommendations were a work in progress and they would assess what action needed to be taken and what impact that had on the risks in their follow up update appended to their progress report to the committee. The report would indicate whether they thought the risk was significantly reduced to move it out of limited assurance and no longer needed to be monitored. He assured the committee that these were high priority recommendations and would ensure that those would be implemented. However, the recommendations were still in the tracker and a report would be circulated straight after the meeting to the Members.

Following a debate on internal controls, it was decided the Committee would work with Members and Officers to review and refine how the papers are managed and presented to ensure that the appropriate level of information is provided behind the summaries provided. For example, the year-end report would reflect which actions in relation to the risks had been taken and when the next action date was as well, because if any reports had been discussed during the year, they needed to be noted in the year-end report.

Cllr Mandy Chilcot queried the risks, school balances and assurance for adults and it was determined that the Committee would make a recommendation that the school balances be looked at by Children’s Scrutiny. The S.151 Officer confirmed that school balances were recognised in the financial strategy report that would to the Executive Committee on the 10th of July and also the Corporate and Resources Scrutiny Committee the week beforehand. This was identified as a key area.

The S.151 Officer further confirmed that, in terms of assurance for adults, there was a change in the reporting structure and this was with the Finance with the Service Director Finance & Procurement and there was an action plan to improve that. He further confirmed that there should be an audit on this soon.

The Service Director Finance & Procurement, Nicola Hix, affirmed that Officers were in the process of setting up the Performance, Risk and Budget Board. She pointed out that the outstanding audit recommendations and the risk report would be discussed there and that the Risk Manager and the Equalities and Risk Manager were also part of the office group that were looking at the tender references for that Board.

Ms Hix suggested that they take away some of the aspirations and concerns of the Audit Committee and feed that in to the board. She suggested that this could be the Officer's forum to feed up into Audit Committee. The Board could be used as a sounding board to disseminate information and gather information across the organisation and bring it up to Audit Committee.

The Committee noted the report.