Mark Niblock, Chief Internal Auditor introduced his report that provided Members of the Committee with the outcome from two Internal Audit reviews undertaken into the effectiveness of systems in operation at the Council for the ‘Verification of the Validity Supplier VAT Registration Numbers’ and the ‘Appointment / Employment of Agency Workers’.

The Audit and Risk Management Committee was apprised that in February 2019 the Director of Governance and Assurance had commissioned Internal Audit to undertake detailed reviews, to provide management with assurances regarding the efficiency and effectiveness of the systems in operation at the Council in the area detailed in the Chief Internal Auditors report.

The Chief Internal Auditor informed that the review relating to the verification of the validity of supplier VAT registration numbers had been completed and the key findings were that:

• The Council had a system in place for inputting VAT registration numbers that satisfied the requirements of HMRC;

• The system in operation at the Council was consistent with the approach adopted by the majority of Councils across the North West of England and advice and guidance provided by professional bodies and organisations;

• Testing undertaken during the audit review identified a number of potentially incorrect VAT Registration Numbers that required further investigation by the Council and possible reporting to HMRC, pending the outcome; and

• A number of actions for consideration by senior managers had been identified that would further strengthen arrangements in this area for the future.

The Chief Internal Auditor further informed that the review relating to appointment/employment of agency staff had been completed and the key findings were that the Council should undertake the following:

• Ensure that a more robust procedure/process was in place when considering and appointing agency staff;

• Strengthen controls for monitoring and managing agency / interim workers;

• Improve Contract Procedure Rules compliance when appointing agency/interim workers outside of the corporate contract;

• Ensure that an agreement (in the form of a contract or service level agreement) was always in place when appointing an agency / interim worker outside of the corporate contract;

• Strengthen controls over determining and communicating IR35 status when the corporate contract had not been utilised; and

• Improve the process of raising purchase orders and subsequent payment of invoices, for agency workers appointed outside of the corporate contract.

Members noted that the Chief Internal Auditor’s report had resulted in recommendations to improve and develop systems of control currently in operation.

Members stated that this matter continued to be of extreme public interest and questioned the Director of Finance and Investment and the Head of Human Resources on concerns regarding issues raised in the Chief Internal Auditors report, namely:

• Issues of confusion arising from combining discussion on the employment of key people i.e. consultants, and the use of agency workers – these elements needed to be disentangled to allow clarity.

• Extreme concern over the use of consultants paid in excess of £500 per day, Members expressed a wish that before such appointments were made there should be Member oversight either via a  ...  view the full minutes text for item 73