CHIEF INTERNAL AUDITORS ANNUAL REPORT AND OPINION 2018/19
- Meeting of Audit and Risk Management Committee, Monday, 22nd July 2019 6.00 p.m. (Item 6.)
- View the background to item 6.
The Chief Internal Auditor, Mark Niblock, introduced his Annual report for 2018/19 which provided an overall opinion as to the effectiveness of the Council’s control environment. He directed the Committee’s attention to Sections 4 and 5 of the report that set out the Audit Outcomes for 2018/19 and the Effectiveness of Internal Audit for the same period. He stated that his overall opinion was that:
“On the basis of our programme of work for the year, I can provide good assurance overall that there is a generally sound system of internal control, designed to meet the Council’s objectives, and controls are generally being applied consistently.
However, some weaknesses in the design and inconsistent application of controls may put the achievement of some objectives at risk. The key governance, risk and internal control issues of which the Chief Internal Auditor was made aware during the year and that impact the overall opinion are included within sections 3 and 4 of this report.”
Responding to comments from Members, Mark Niblock stated that everything in his report had been brought to the attention of individual chief officers. Actions arising from the report had been, or were in the process of being addressed. This committee had also had oversight of all the actions required from individual reports throughout the year. There were some issues which were carried over from 2018/19 into 2019/20, such as work on the Local Plan and financial resilience, nothing as such remained outstanding as work to address these issues was being undertaken within timescales. The Committee was kept informed through reports and also bi-monthly reports sent out to all committee members. He also met with the Chief Executive on a regular bi-monthly basis and discussions were held with the senior leadership team.
Councillor Jeff Green stated that he was still not clear what the Chief Executive had said when the report was presented to him but he would find a way to ascertain his views on this.
In response to further comments, Mark Niblock, provided clarity on the opinions expressed in his report and the negligible, minor, moderate and major risks referred to. The 2018/19 risks referred to in the ‘pie chart’ would be different to those in 2017/18. He responded to comments in respect of one of the Council’s core financial systems, the Client Finance Support Unit, which was the only one to be rated as a major risk.
The Director of Finance and Investment, Shaer Halewood, further remarked that this related to personal client finances and court appointeeships made to look after the finances of vulnerable people. She assured the Committee that there was no suggestion of financial mismanagement but rather about the processes that were being applied to manage the client finances. She also commented that she had been in regular contact with the Office of the Public Guardian and they were due to make an inspection to Wirral.
Councillor Jeff Green agreed with a Member the need for a more detailed report in respect of the personal client finances and what had been found and what was the action plan in place as the information needed to be sufficient for the Committee to have assurance.
In response to more comments, Mark Niblock stated that all risks identified in his report as being of moderate risk, such as ‘Friends of Royden Park’, ‘Mosslands School’ or ‘Payments to Forge House Associates Ltd’ were there for a reason such as the potential for financial issues to arise or reputational damage to occur to the organisation. There were a number of factors that were considered when determining what was of moderate risk, he acknowledged that this was a very subjective opinion but taken by experienced auditors. He also assured the Committee of his and his team’s independence operating with 100% freedom from the Director of Finance and Investment and the Chief Executive. They operated under a code of ethics as laid down by the Chartered Institute of Internal Auditors. Additionally, in 2018/19 the team had been externally assessed against the public sector internal audit standards and found to have been fully compliant in all areas.
He further stated that there would be a number of items which would move up and down between the categories and the bi-monthly report to Committee members did show the direction of travel.
Councillor Jeff Green suggested and it was agreed that a briefing for the Chair, Vice-Chair and Spokespersons could be held every two months or so to discuss the Chief Internal Auditor’s findings and opinions on key areas of the Council’s activity.
Mark Niblock also agreed to arrange a training session for all the Committee members. He could train Members on their role on the Committee as well as anything else which Members might specifically request.
Resolved – That the report be noted.
At this point the Chair introduced Iain Miles who had joined Mark Niblock’s team as Audit Manager.
- CHIEF INTERNAL AUDITORS ANNUAL REPORT AND OPINION 2018/19, item 6. PDF 72 KB
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