Audit, Standards and General Purposes Committee
Agenda Item 9
Subject: Internal Audit Annual Report and Opinion 2025/26
Date of meeting: 23rd June 2026
Report of: Director of Property and Finance (S151)
Contact Officer: Carolyn Sheehan (Audit Manager)
Email: carolyn.sheehan@brighton-hove.gov.uk
Mark Winton (Acting Chief Internal Auditor)
Email: mark.winton@eastsussex.gov.uk
Ward(s) affected: All
1.1 The purpose of this report is to give an opinion on Brighton and Hove City Council’s control environment for the year from the 1 April 2025 to 31 March 2026.
2.1 That the Committee note the work undertaken and the performance of Internal Audit in 2025/6 and the annual opinion of the Chief Internal Auditor.
2.2 Determine whether there are any matters that the Committee wishes to consider for the inclusion in the Council’s Annual Governance Statement.
2.3 That the Committee agrees that the Council’s arrangements for internal audit proved effective during 2025/26.
3.1 The purpose of this report is to give an opinion on the adequacy of Brighton and Hove City Council’s control environment as a contribution to the proper economic, efficient, and effective use of resources. The report covers the audit work completed in the year from 1 April 2025 to 31 March 2026 in accordance with the Internal Audit Strategy 2025/26.
3.2 All local authorities must make proper provision for internal audit in line with the 1972 Local Government Act (S151) and the Accounts and Audit Regulations 2015. The latter states that authorities ‘must undertake an effective internal audit to evaluate the effectiveness of its risk management, control and governance processes, taking into account public sector internal auditing standards or guidance’. Annually the Chief Internal Auditor is required to provide an overall opinion on the Council’s internal control environment, risk management arrangements and governance framework to support the Annual Governance Statement.
3.3 It is a management responsibility to establish and maintain internal control systems and to ensure that resources are properly applied, risks appropriately managed and outcomes achieved.
4.1 No assurance can ever be absolute; however, based on the internal audit work completed, the Chief Internal Auditor can provide partial assurance that Brighton and Hove City Council has in place an adequate and effective framework of governance, risk management and internal control for the period 1 April 2025 to 31 March 2026.
4.2 This opinion and the evidence that underpins it, is further explained in the full Internal Audit Annual Report and Opinion, attached as Appendix 1.
4.3 The report highlights key issues for the year, including a summary of all audit opinions provided, work on key financial systems and other internal audit activity.
4.4 There is a separate report on Counter Fraud activity to be presented alongside this report.
4.5 Appendix 1 includes information regarding internal audit performance for the year, including details of compliance against the relevant professional standards.
4.6 Appendix 1 also lists all of the audits completed during 2025-26 and their individual opinion, including some reports that were still in draft stage at year end and will be summarised in the Q1 progress report due to come to committee in September.
4.7 A summary of the major findings from audit reviews completed during quarter 4 of 2025/26 is included as a separate report to the Committee. Summaries from previous quarters have already been reported to Audit, Standards and General Purposes Committee.
5.1 The annual report has been informed by internal audit and counter fraud work carried out during the year, which has included extensive engagement with officers and members.
6.1 There are no direct financial implications arising from this report. Sound corporate governance, risk management and control are essential to the financial health and reputation of the Council.
6.2 The audit opinion is partial assurance. Prompt and robust action is required to address findings. Any financial implications of doing so will be reported through the Council’s Targeted Budget Management reporting cycle.
Name of finance officer consulted: Haley Woollard Date consulted: 05/06/25
7.1 The Accounts and Audit Regulations 2015 require the Council to undertake an effective internal audit to evaluate the effectiveness of its risk management, control, and governance processes, taking into account Public Sector Internal Audit Standards. Reviewing the work planned and completed by the Council’s internal audit function is a key part of the Audit, Standards and General Purposes Committee’s delegated functions.
Name of lawyer consulted: Victoria Simpson Date consulted (28/05/26):
8. Risk implications
8.1 The Chief Internal Auditor is required to provide an overall opinion on the Council’s internal control environment, risk management arrangements and governance framework to support the Annual Governance Statement. The Council’s Internal Audit Strategy and Plan is developed based on a combination of management’s assessment of risk (including that set out within the departmental and strategic risk registers) and our own risk assessment of the Council’s major systems and other auditable areas. Issues arising from individual audit reports, summarised in quarterly progress reports to this Committee, have been presented to management and action plans have been formally agreed to mitigate risks. It is a management responsibility to establish and maintain internal control systems and to ensure that resources are properly applied, risks appropriately managed and outcomes achieved.
9.1 There are no direct equalities implications.
10.1 There are no sustainability implications
11.1 There are no other implications
12.1 The Committee is recommended to note the report and Internal Audit Service’s opinion on the Council’s control environment, consider whether there are any significant issues that should be included in the Council’s annual governance statement for 2025/26 and consider whether the Council’s system for internal audit has proved effective.
Supporting Documentation
1. Internal Audit Annual Report and Opinion 2025/26