To consider the adoption of an Internal Audit Charter in compliance with the Public Sector Internal Audit Standards.

The Committee considered a report by the Chief Finance Officer which proposed the adoption of an Internal Audit Charter so that the Council would comply with the Public Sector Internal Audit Standards as applied in the UK. The meeting was aware that the Public Sector Internal Audit Standards were based on international standards which had been adopted by the UK on 1 April 2013.

A copy of the draft Charter was attached at Appendix A to the Chief Finance Officer’s report.

Members were reminded that the Committee had a key role in ensuring that effective corporate governance arrangements were both in place and maintained.  The proposed Internal Audit Charter would provide evidence of such arrangements with regard to the Internal Audit function and fully reflected the recent adoption of the Public Sector Internal Audit Standards. 

Members noted that the Charter would replace both the Internal Audit Strategy and the original Internal Audit Charter, both of which had been previously approved by the Committee.  The documents had complied with the Chartered Institute of Public Finance and Accountancy (CIPFA) Code of Practice 2006 which was the predecessor to the new Public Sector Internal Audit Standards.  It was further noted that the original Internal Audit Charter had been renamed as the Internal Audit Engagement Protocol, a title which better described its contents.

The Chairman drew the Committee’s attention to paragraph 4.4 of the draft Charter which specifically excluded Internal Audit from investigating benefits fraud and sought clarification.  In response the Chief Finance Officer explained that this function was carried out by dedicated officers within the Revenues and Benefits Team and that the Team had enjoyed considerable success in its work.  He added that the Government had considered the creation of a national fraud unit but no further action had been taken.

In connection with the gathering of intelligence on benefits fraud a Member commented that the absence of suitable facilities at some of the Council’s offices discouraged members of the public from raising concerns.  The Committee noted the action already taken to overcome this issue.

Following a query by a Member the Chief Finance Officer explained how cases of benefits fraud were identified by officers.  The Chief Finance Officer stressed that simple errors by claimants would not result in prosecution.

Turning next to paragraph 8.2 of the draft Charter the meeting noted the reference to the Audit Committee’s agreed work plan for the year.  It was felt that the plan, which was currently only submitted to the Committee for approval at the start of the municipal year, would prove of greater benefit if it were submitted, considered and updated at each meeting.

In conclusion, and on behalf of the Committee, the Chairman congratulated the Head of Internal Audit and Risk and her team for their work.

RESOLVED

1          that the draft Internal Audit Charter, as attached at Appendix A to the report of the Chief Finance Officer be approved and adopted;

2          that a report be submitted to a future meeting of the Committee on benefits fraud and the measures being taken by the Council to combat it;

3          that the Audit Committee’s work plan be submitted to all future meetings of the Committee with effect from its next meeting on 31 March 2014.