Agenda item - Internal Audit Annual Report and Opinion 2020/21

Report of the Acting Chief Finance Officer

1)             That the Committee note that, whilst no assurance can ever be absolute, based on the internal audit work completed in the year, reasonable assurance has been provided on the overall adequacy and effectiveness of the Council’s framework of governance, risk management and control for the year ended 31 March 2021.

2)             That the Committee note the assurances and improvement actions detailed on audits finalised since the last progress report to this Committee in March 2021.

8.1         The Committee considered a report of the Acting Chief Finance Officer that provided opinion on the adequacy of Brighton & Hove City Council’s control environment as a contribution to the proper, economic, efficient, and effective use of resources. The report covered the audit work completed in the year from 1 April 2020 to 31 March 2021 in accordance with the Internal Audit Strategy for 2020/21. The report also included a summary of the results of internal audit work for the year along with a narrative summary of those audits finalised since the last progress report to the Committee in March 2021.

8.2         In response to a question from the Chair, it was clarified that the report on temporary accommodation that would be received at the next meeting would focus on the financial administration, processes and controls on debt recovery for that service as well as bad debt provision.

8.3         In response to questions from Councillor High-Jones, it was clarified that the incident of fraud referenced, the individual resigned and had paid back the entire some they benefitted. The incident had been detected quickly and stricter controls were now in place to minimise this risk. In reference to the cases of housing tenancy fraud, none of the cases referenced had been taken to prosecution. On contract management, this was an area where work would be increasing over the next year and public conveniences was a good representation of some of the challenges faced in maintaining effective contract management although the issue had been detected quickly. It was confirmed that an issue had been identified with an overreliance on the assurances on health and safety and insurance checks from the previous housing repairs contractor and this would be some something that was part of the re-procurement of contracts for the in-house service.

8.4         In response to a question from Councillor Meadows, it was clarified that any decision to change how a service operated came with financial risk and Internal Audit had flagged that risk for the in-house housing repairs service, but it was very difficult to quantify, particularly due to the significant pressures facing the service due to the pandemic. Follow up work would be conducted to provide assurance.

8.5         RESOLVED-

1)            That the Committee note that, whilst no assurance can ever be absolute, based on the internal audit work completed in the year, reasonable assurance has been provided on the overall adequacy and effectiveness of the Council’s framework of governance, risk management and control for the year ended 31 March 2021.

2)            That the Committee note the assurances and improvement actions detailed on audits finalised since the last progress report to this Committee in March 2021.