The Chief Internal Auditor introduced his update report that identified and evaluated the performance of the Internal Audit Service and detailed issues arising from work undertaken during the period 1 June to 31 August 2016. He informed that the report highlighted items to note, issues arising that require actions to be taken by Members, performance information and developments being undertaken to improve the effectiveness of the Internal Audit Service.

Members were informed that there were two items of note concerning audit work undertaken as highlighted in section 3.2. of the report. The Chief Internal Auditor informed Members that following an audit undertaken during 2015/16 into the procurement of infrastructure advisory services to Merseyside Pension Fund (MPF), as was reported to this Committee in Feb 2016, further assurance work was completed across all MPF contracts to ensure compliance with the Contract Procedure Rules (CPRs) and MPF as reported to this Committee in June 2016.

It was further reported that a significant amount of work had been undertaken by the Internal Audit Service to support the production of the Annual Governance Statement

The Chief Internal Auditor then reported upon outstanding audit recommendations and referred to Appendix 1 of the report (a table identifying information relating to those audits where recommended actions included in audit reports for 2015/16 and the current year to date have not yet been fully implemented.)  It was explained that reports identifying outstanding actions are currently RAG rated as ‘amber’, and a number of these related to audits undertaken within IT Services. Members heard how these actions are currently being overseen by the Information Governance Board chaired by the Strategic Director for Transformation and Resources.

Members heard how a continuous Internal Audit Improvement and Development Plan had been formulated to incorporate new and developing areas of best practice from across the profession, ensuring that the service continues to constantly challenge how efficient and effective it is at delivering its service to all of its stakeholders and making any relevant changes and improvements as required.

In response to a question asked by a Member, the Chief Internal Auditor assured the Committee that issues surrounding Corporate Procurement is the subject of high profile monitoring.

Members were informed that achievement of the audit plan is slightly behind schedule for this time of year due to a number of vacant posts within the section that have proven difficult to fill. However, a new Member of staff is due to start this week.

In response to a question asked by a Member regarding ICT disaster recovery, it was explained that this remains to be a significant issue and is being managed by the Corporate Governance Group.

A discussion was had amongst Members about the need for an escalation process through the Audit and Risk Management Committee to refer matters of concern to the Cabinet. It was suggested that an amendment be added to the recommendation as follows:-

“A standard Agenda item be added to future meetings of the Audit and Risk Management Committee to escalate areas of concern to the Cabinet.”

The motion was put and carried (9:0)

Resolved: That

1)  the report be noted; and

2)  a standard Agenda item be added to future meetings of the Audit and Risk Management Committee to escalate areas of concern to the Cabinet. (see Minute 19).