This report provides an update on key findings emanating from Internal Audit reports issued since the last quarterly progress report.

Paul Harrington, Chief Auditor, submitted a report providing an update on key findings emanating from Internal Audit reports issued since the last quarterly progress report in January 2020.  The report highlighted that there would be a review of Internal Audit work to be undertaken in 2020/2021 and any amendments to the plan would be reported back to the Audit & Governance Committee at its next meeting. The review would be mindful that a proportionate approach to Internal Audit must be taken to allow Reading Borough Council staff and members to focus on the priorities, during these unprecedented times.

The report set out a summary of the audit reports in respect of Sundry Debtors; Bank and Control Account Reconciliations; Accounts Payable; Journal Testing; NNDR; DBS Checks; Web Payments; Housing Rent Accounting; Freedom of Information (follow-up); Blue Badge Scheme; and Residents’ Parking (follow-up).

In relation to Sundry Debtors, the report strongly recommended that the corporate debt policy, recovery strategy and control framework for managing and monitoring debt was fully reviewed alongside the project for changing the debt management system as performance and collection levels and control had deteriorated.  The deterioration in performance and increasing debt with no effective procedure in place had resulted in internal audit being unable to give any assurance.

In relation to Bank and Control Account Reconciliations, it was reported that despite previous review recommendations, Internal Audit still found no uniform approach in the production of reconciliations, where consistent standards for the recording of information and the retention of audit trails could then be evidenced. There was also an absence of a process to establish the segregation of duties involved in the preparation, review and approval of reconciliations, except for the Council’s main bank account reconciliation.

In relation to Accounts Payable, Internal Audit had noted that a project had commenced to map business processes and provide documented business practices with measurable performance indicators.  However, notwithstanding the project that was now in train, this was the fourth consecutive year that the Council’s Accounts Payable system had only received limited assurance.

The report also listed the audits that were currently in progress, or were planned for 2020/21, and gave a summary of investigations work between April and August 2019.

Resolved:     That the Internal Audit recommendations set out in the report be endorsed and in particular those that applied to Sundry Debtors, Bank and Control Account Reconciliations and Accounts Payable.