The Committee considered details of the Internal Audit Annual Report 2020/21. Responding to significant weaknesses in the governance of the Council’s Subsidiary Companies, Members were informed that extensive work was on going to address issues that had been identified. Discrepancies in the reconciliations process in council tax were also being investigated.
Resolved - That details of the report be noted.
The Committee consider a report from the internal auditors that detailed the Head of Internal Audit Opinion for 2020/21 which concluded that: “The organisation does not have an adequate framework of risk management, governance or internal control.”
The reasons for that opinion were summarised and included a high number of high and medium priority management actions on audits such as the review of subsidiary companies, cyber security and whistleblowing and the fact Follow Up reviews highlighted a significant proportion of actions that had not been implemented. Weaknesses had been identified in the risk management process, although the Section 151 Officer and Chief Executive had agreed actions to strengthen the processes. Members discussed a number of matters such as the subsidiary companies, Annual Governance Statement and rent arrears recovery.
Following consideration of the issues highlighted in both the Internal Audit Progress Report and the negative Head of Internal Audit Opinion the Committee expressed serious concerns about the management response to internal audit recommendations over several years. Previous reports to the Committee from management had given a misleading impression that recommendations were being implemented, but it had become apparent that there were systematic issues to be addressed to improve the timeliness of action and reporting in response to internal audits. The Committee therefore agreed to hold an extraordinary meeting in early September at which the Chief Executive and Executive Directors would be required to attend to discuss the internal audit reports presented to the meeting.
(a) That the report be noted.
(b) That an extraordinary meeting of the Committee be convened in early/mid September at which the Chief Executive and Executive Directors would attend to respond to the concerns expressed about the lack of progress in persistence and long standing weakness in implementing management actions (e.g. in the Follow Up Audit to Q3); and the Head of Internal Audit opinion 2020/21.