Agenda item

To receive the quarterly progress report on Internal Audit activity.

21.1       The Head of Audit, Risk and Assurance (ARA) outlined the content of the report. He highlighted that the report had a different look and feel to previous progress reports. He said that the summaries were now more concise and that a summary of work conducted for 2022-23 was included. He said that the report included summaries of grant certification work undertaken as well as a follow up Audit for Gloucestershire Airport Ltd.

21.2       The Head of Audit, Risk and Assurance stated that there had been no new irregularities referred to the ARA Counter Fraud Team.

21.3       He said that the progress report was now broken down into quarters which was colour coded to indicate the likeliness of when each specific audit would begin.

21.4       Regarding counter-fraud, he said that thanks to the work undertaken by the National Fraud Initiative (NFI) they had recovered approximately £42,000 on behalf of the Council.

21.5       Councillor Bowkett asked how long the National Fraud Initiative would continue for. In response, the Head of Audit, Risk and Assurance said that it was a continuing process that took place every two years. He said that data was amalgamated from various sources, such as the electoral roll, payroll, creditors and council tax and that this data gets matched for Councils to view. He stated that the next round of uploading data would happen in October.

21.6       The Chair referred to the Contain Outbreak Management Fund pointed to paragraph 2.5(iv) of the report. He stated that there had been an underspend, owing to the Cyber Incident and that it had not been possible for Internal Audit to verify the carry forward balance of the grant to the financial system. He asked whether the Treasury were content with this. In response, the Group Manager (ARA) confirmed that while agreement had not been made to the general ledger, ARA had agreed the balance to the alternate records maintained by the Council and that this was reasonable. The certification to the funding body was made on this basis.  She stated that where grant review is required for 2022/23, ARA  would be able to perform a retrospective review of the uploaded ledger. The Director of Policy and Resources added that since the Cyber Incident, the Council had worked closely with Government, particularly the Department for Levelling Up, Communities and Housing (DLUCH) so that they were aware of their situation.

21.7       The Chair noted that the Council was awarded £57,861 to Protect and Vaccinate and asked why this funding was not used. In response, the Group Manager (ARA) said that a variety of  COVID grant funding came at different points of the year. She confirmed that the Protect and Vaccinate grant was allocated for a very specific purpose, that the funding determination was issued on the 31^st January 2022 and required expenditure by 31^st March 2022.

21.8       The Chair noted that the recommendation outlined in paragraph 2.16(v) of the report which was that Gloucestershire Airport Ltd report the detail of any outstanding governance action plan issues and that forum papers should include the position and progress on policy and procedure review. He said that the target completion date for these actions was the 31^st of July 2022, which had passed. He asked whether the Audit team were planning on following up. In response, the Group Manager (ARA) confirmed that ARA have a recommendation follow up approach and that both Airport recommendations would be captured by this.  The Director of Policy and Resources added the second recommendation had now been actioned by the Airport and that they would conduct a policy and procedure review on an annual basis.

21.9       Councillor Bowkett asked the Head of Audit, Risk and Assurance how long the National Fraud Initiative would continue to work on COVID-19 grants where there had been examples of fraud. In response, the Head of Audit, Risk and Assurance said that he would liaise with the counter fraud team and get back to Councillor Bowkett. The Director of Policy and Resources added that all grants had been checked for fraudulent activity which had been reported back to government. He said there were 3 examples of fraudulent activity and for 2 of these, the money had been recovered. The Group Manager (ARA) added that where potential irregularities on Covid-19 grants had been referred to ARA, the Counter Fraud Team had progressed these and  reported  outcomes to the Committee (in line with report section 3).

21.10   Councillor Melvin highlighted the excellent work that the Intelligent Client Officer (Revenues and Benefits) and her team had put in to ensure that COVID grants were checked and provided to residents and businesses in a timely fashion. She added that she was proud that Gloucester City Council had queried central government when issues were identified.

21.11   The Chair noted that he liked the updated format of the Internal Audit Activity Report and that he wished for future reports to keep that format.

21.12   RESOLVED that the Audit and Governance Committee

i.               Accept the progress against the Internal Audit Plan 2022/23; and

ii.              Accept the assurance opinions provided in relation to the effectiveness of the Council’s control environment (comprising risk management, control and governance arrangements).