Agenda item

Report attached.

The Internal Audit and Corporate Risk Manager submitted a report detailing progress in delivering the approved audit plan in quarter 2 of 2011/12. During the quarter ending 30 September 2011 40% of the Audit Plan had been completed against a target of 35%. Six assignments had been completed with ten still in progress awaiting final report stage.

Details of the six completed system audits were provided, with five receiving a substantial opinion and one, in respect of Complaints receiving a limited assurance. Having considered the written reports and the presentation by officers the Committee raised questions concerning the following reports:

• NDR (Non Domestic Rates) – In April 2008 the Council entered into a three year agreement for the London Borough of Barking and Dagenham (LBBD) to discharge the Council’s NDR function, with the option to extend the agreement annually. Whilst the day to day administration of the NDR function had been transferred to LBBD, responsibility for a number of NDR processes remained with the Council. Any accounts which were in arrears at the time of the agreement, and where a liability order had been obtained, remained the responsibility of the Council to recover. At that time the value of the debt was approximately £3m across 572 accounts. By July 2011 £1.1m had been written off and £400,000 received in payment. This left the Council with a debt of £1.5m. The recovery of these accounts had not been undertaken in line with Council requirements.

Delays in debt recovery could result in the debts being written off on the basis that the Council was statue barred from recovering them. No recommendation had been made because management had already implemented a team to review and resolve arrears on both Council Tax and NDR accounts. Historically write off figures were not reported to the Debt Management Board or the Governance Board. This was now a corporate requirement.

Officers informed the Committee that at the time of the audit a list of Business Improvement District (BID) properties was not available. This prevented any reconciliation to ensure that charges had been properly applied to all accounts.

The Committee requested a further report to the next meeting so they could have an assurance that the matters identified were now being undertaken correctly.

• BACS Application – The audit had found that invoices which should be paid within 30 from the date that they were received had not been paid on time and were two weeks in arrears, The Committee considered this to be a serious issue and asked for a report back to the next meeting so they could have an assurance that a process was now in place to ensure invoices were paid in a timely manner.

• Complaints – The Committee were advised that all six recommendations raised as a result of the 2009/10 Complaints audit had either been fully or partly implemented. All of those recommendations would, however, need to be revisited given the implementation of the new CRM system and the staffing changes resulting from the introduction of ISS and recent restructures.

Although the current audit had resulted in only three recommendations one was of high priority and the system had received a limited assurance. The Committee expressed their concern as complaints handling was a fertile area for the Ombudsman. The current system did not meet the objectives of a Corporate Complaints system, i.e. it did not help the Council target resources. The system was very process driven and officers needed it to focus on quality and to ensure that staff and management were suitably and appropriately trained.

The Committee requested a report back to the next meeting so an assurance could be given that the weaknesses identified had been addressed by management.

In addition to the system audits the Team had undertaken audits of two schools. One school had received a substantial audit, the other a limited opinion. In the latter case a member asked to be informed whether that school employed a bursar.  The Committee were of the opinion that there was a serious problem with the school which had received a limited opinion. They were advised by officers that Social Care and Learning were monitoring the situation and they expected all the recommendations to be implemented by the end of the financial year. If the school had not taken up the option of a Health Check by Social Care and Learning the audit team would be carrying out a follow up inspection next year.

The report was noted.