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 reportproviding an update on key findings emanating from Internal Audit reports issued since the last quarterly progress report in September 2021.

The report set out a summary of the audit reports in respect of: Payments to Care Providers; Payments to Voluntary Sector Organisations; Staff (Grey Fleet) Vehicle Documentation; and Housing Allocations Scheme.  As the Chief Auditor had given ‘no assurance’ to Payments to Care Providers and ‘limited assurance’ to Payments to Voluntary Sector Organisations, the full internal audit reports for these two audits were appended to the report.

In relation to Payments to Care Providers, the report stated that the overpayment of around £1m had been triggered after inflationary increases had been incorrectly applied.  There was no adequate control/ workflow process around the treatment of inflationary uplifts and no independent review to check for accuracy.  Changes were made manually and therefore subject to increased risk of error and potential fraud.  In addition, amendments within Mosaic were unable to be reviewed in real time, so issues could take several days to identify and then several more days to ensure they were corrected.  The Director of Finance had given assurance that no financial loss had occurred, and that all monies had been fully recovered despite the process failures identified by the audit. 

Seona Douglas, Executive Director of Social Care & Health and Melissa Wise, Deputy Director of Commissioning & Transformation attended the meeting and responded to questions from the Committee.  The Executive Director reported that some of the recommended actions were already in place and complete and gave assurances that arrangements had been made to oversee and ensure the effective implementation of the other audit recommendations.

In relation to Payments to Voluntary Sector Organisations, the report stated there was reliance on a number of key individuals and a high degree of manual intervention, with limited resilience or a shared understanding of the process between the services.  Paying invoices to suppliers on time was a high priority as it could have a significant impact on the financial viability of smaller organisations as well as causing reputational damage to the Council. 

The report also listed the audits that were currently in progress and gave a summary of investigations work between April 2021 and December 2021.

Resolved:     That the audit findings in relation to Payments to Care Providers; and Payments to Voluntary Sector Organisationsbe noted, and the recommendations and management action underway, as set out in the full audit reports, be endorsed.