Agenda item

Report of the Shared Internal Audit Service (SIAS) on the overall opinion on the adequacy and effectiveness of Welwyn Hatfield Borough Council’s framework of governance, risk management and control.

Report of the Shared Internal Audit Service (SIAS) on the overall opinion on the adequacy and effectiveness of Welwyn Hatfield Borough Council’s framework of governance, risk management and control.

It showed the outcomes of the self-assessment against the Public Sector Internal Audit Standards (PSIAS) incorporating the requirements of the Quality Assurance and Improvement Programme (QAIP).

Summarised the audit work that informed this opinion, showed SIAS performance in respect of delivering the Council’s audit plan. And presented the 2022/23 Audit Charter for approval.

The following points were highlighted and noted:

•It was noted that SIAS changed the scale and definitions of assurance ratings used to communicate the results of audit assignments from 1 April 2021. This change was in response to the CIPFA publication in April 2020, “Internal Audit Engagement Opinions – Setting Common Definitions”, where CIPFA recommended that a standard range of opinions and definitions were used by Internal Audit teams.

•At paragraph 2.1, SIAS assessed the robustness of internal control and risk management. It was management’s responsibility to ensure that robust risk management and control arrangements were maintained.

•At paragraphs 2.4 to 2.12, the review of effectiveness section provided SIAS with outcomes from the key elements Public Sector Internal Audit Standards (PSIAS) that allow the committee to be assured that the service followed those standards and includes elements such as the external quality assessment (EQA), the quality assurance improvement programme which was SIAS’s internal review that was headed by the Head of Assurance and Public Sector Internal Audit Standards (PSIAS) self-assessment. Based on all of those SIAS have concluded that SIAS generally conform with the PSIAS. It was the highest rating under the standards.

•At paragraph 2.13, it provided an important statement as SIAS, confirmed that no matters threatened their independence during 2021/22 and that SIAS were not subject to any inappropriate scope or resource limitations. The Deputy Section 151 officer confirmed that they were happy that SIAS was not subject to any inappropriate scope or resource limitations.

•At paragraph 2.14, it provided the overall opinions that SIAS had provided for financial and non-financial systems with the Council. Overall they provided an opinion of reasonable assurance which was defined as a generally sound system of governance, risk management and control in place. Some issues of non-compliance or scope for improvement were identified which may put at risk the achievement of objectives in the area audited.

•At paragraph 3.2, the overall summary of the number of audits in the various categories at assurance level as well as the total number of recommendations at different levels. Full details could be found in Appendix A.

•At paragraph 4.1, it looked at the performance indicators. SIAS had an agreed target with the council of delivering 95% of the audit planned days that were commissioned. SIAS delivered 98% which was above the performance indicator and delivered 96% for the planned projects which was also above the 95% target performance indicator.

•In Appendix C, it was noted that it provided areas of deviation from the Public Sector Internal Audit Standards (PSIAS). Members noted that SIAS reported two areas of intentional non-conformance. These were specifically due to the nature of the partnership that had a host authority, Hertfordshire County Council. These were deemed areas that would impact on the overall compliance with PSIAS.

•In Appendix D was the audit charter, following SIAS’s external quality assessment in 2021, the assessor provided observation on how the charter could be clearer, SIAS presented a revised version of the charter to the Audit committee in 2021. It was highlighted that there have been no significant changes to the charter since that version was presented.

•Members asked about the client satisfaction survey and the one area that was not marked as satisfactory. What was the feedback and how has that been acted upon? SIAS stated that they would have to look into that. But within the progress report, SIAS provided a rolling performance indicator and assured the committee that once SIAS received the client satisfaction survey, it would have been reported in the progress report and what they were doing with the feedback from the survey.

RESOLVED:

(unanimous)

(1)   The committee noted the Annual Assurance Statement and Internal Audit Annual Report.

(2)   The committee noted the results of the self-assessment required by the Public Sector Internal Audit Standards (PSIAS) and the Quality Assurance and Improvement Programme (QAIP).

(3)   The committee approved the SIAS Audit Charter.

(4)   The committee sought management assurance that the scope and resources for internal audit were not subject to inappropriate limitations in 2021/22.