BOROUGH OF POOLE
REPORT TO SERVICE PROVISION SCRUTINY AND AUDIT COMMITTEE
4 NOVEMBER 2004
INTERNAL AUDIT & REVIEW SECTION ACTIVITY REPORT –
JANUARY 2004 – JUNE 2004
(EDUCATION AND COMMUNITY ITEMS ONLY)
PART OF PUBLISHED FORWARD PLAN: NO
STATUS – GENERAL
1. PURPOSE AND POLICY CONTEXT
1.1 This report gives details of the audit work undertaken by the Section during January to June 2004, relating to those areas previously reported to Community Support and Education Scrutiny only. The key findings and recommendations are highlighted. Current progress on implementation of recommendations (at the end of October 2004) is detailed.
1.2 Prior to this Committee becoming the Audit Committee in September 2004, Members will recall that the findings and recommendations relating to this Scrutiny Committee were reported in September 2004. At the next meeting of this Committee, the report will include all Service Units.
1.3 Poole Housing Partnership internal audits are no longer being reported to the Borough of Poole members, apart from those audits which relate to the Borough’s Section 151 interest.
2. DECISION REQUIRED
2.1 Members are asked to note the following report on the audits carried out during January to June 2004, and current progress (to October) on recommendations made.
3 . PLANNED AUDITS
3.1 SASS
3.1.1 Schools
3.1.2 Poole High School
The audit concluded that the risks within the administrative and financial systems of the school were being adequately managed. Nine out of ten of the recommendations from the previous audit had been implemented, with one medium priority recommendation, to review letting charges, was re-iterated. Thirteen new recommendations were made, including four high priority recommendations, covering complying with Contract Standing Orders and Financial Regulations, arrangements for vending machines, and evidence of reconciliation of PLASC data.
3.1.3 Haymoor Middle School
The audit concluded that the risks within the administrative and financial systems of the school were being adequately managed. Eight out of nine of the recommendations from the previous audit had been implemented, with one medium priority recommendation relating to declaration of pecuniary interests, being re-iterated. A further five recommendations, all medium priority, were made covering areas such as ordering and physical security.
3.1.4 Ashdown School
The audit concluded that the risks within the administrative and financial systems of the school were being adequately managed. Five out of six of the recommendations from the previous audit had been implemented, with one medium priority, relating to lettings, was re-iterated. A further thirteen recommendations were made, including three high priority areas. These related to compliance with Contract Standing Orders and the ordering procedures.
3.1.5 Broadstone Middle School
The audit concluded that the risks within the administrative and financial systems of the school were being adequately managed. Seventeen out of eighteen of the recommendations made at the previous audit had been implemented, with one, medium priority recommendation being re-iterated, in relation to ordering. A further ten recommendations were made, including two high priority recommendations relating to adherence to Contract Standing Orders.
3.1.6 Winchelsea School
The audit concluded that the risks within the administrative and financial systems of the school were being adequately managed. Fourteen out of seventeen of the recommendations made at the previous audit were implemented, with three medium priority recommendations were re- iterated, covering lettings and pecuniary interests. A further twenty five recommendations were made, including two high priority recommendations relating to adherence to Contract Standing Orders and ordering. The majority of the recommendations have been made to enhance the current system rather than to address fundamental weaknesses.
3.1.7 St Joseph’s School
The audit concluded that the risks within the administrative and financial systems of the school were being adequately managed. Twelve of the fourteen recommendations from the previous audit had been implemented, with two, relating to pecuniary interests (medium priority) and letting charges (low priority) being re-iterated. A further six recommendations of medium and low priority were made, covering areas such as IT use were made.
3.1.8 Turlin Moor Middle School
The audit concluded that the risks within the administrative and financial systems of the school were being adequately managed. Thirteen out of fourteen of the recommendations from the previous audit had been implemented, with one medium priority recommendations relating to submission of financial monitoring returns. A further thirteen recommendations were made, including one high priority recommendation relating to compliance with Contract Standing Orders.
3.1.9 Montacute School
The audit concluded that the risks within the administrative and financial systems of the school were being adequately managed. Three out of four recommendations from the previous audit were implemented, with one high priority recommendation, relating to following Contract Standing Orders, being re-iterated. A further three recommendations were made, including one high priority relating to ordering.
3.1.10 Heatherlands First School
The audit concluded that the risks within the administrative and financial systems of the school were being adequately managed. Nine out of twelve recommendations from the previous audit were implemented, with three (medium and low) recommendations being re-iterated, relating to lettings, payments, and pecuniary interests. A further sixteen recommendations were made, including two high priority recommendations relating to compliance with Contract Standing Orders and security.
3.1.11 Strategic Management
The audit concluded that the risks within the service were being adequately managed. No recommendations were made.
3.2 Pupil & Parent Support
3.2.1 Broadstone Christian Nursery
The amount of Nursery Education Grant (NEG) claimed was found to be accurate, and the nursery appeared to be operating in line with the NEG conditions.
3.3 ASSC
3.3.1 Supporting People
The audit concluded that the manual systems in place appeared to be working well and that the risks were being adequately managed. However, given that the “Care Support” computer system was still not being fully utilised, four of the eighteen recommendations made at the previous report had not been implemented and were reiterated, including one high priority recommendation relating to system security. A further eleven recommendations were made, including one high priority recommendation relating to compliance with Contract Standing Orders.
3.3.2 Care First
The Care First system is the integrated, computerised database which is used by all social services units in the authority. The audit concluded that all risks were being adequately managed, however, there were concerns regarding the efficiency of the system. Six out of eight recommendations from the previous audit had been implemented, the remaining two having been implemented subsequently. A further three medium priority recommendations were made.
3.4 Culture & Community Learning
3.4.1 Adult Learning
The audit concluded that the risks in Adult Education appeared to be adequately managed. However, at the time of the audit, nine out of thirty seven recommendations made previously (in routine audits and investigations) were still outstanding, and were re-iterated. These included three high priority recommendations, relating to ordering and compliance with Financial Regulations and Contract Standing Orders. A further eleven recommendations were made, including two high priority recommendations. These related to ensuring the computer system was maintained promptly and accurately and to reduce the backlog of applications. Currently, a total of six recommendations (see Table 5.2.5) are still outstanding.
3.5 Housing and Community Services
3.5.1 Landlord Incentive Scheme
The risks within the service appeared to be adequately managed. No recommendations were made.
3.6 Children & Families
3.6.1 Children & Families
The audit concluded that the risks within the Children and Family Service appeared to be adequately managed. All the previous recommendations had been implemented. Two high priority recommendations were made during the audit, in relation to compliance with Contract Standing Orders and enhanced record keeping for selection of care providers. Both of these have been implemented subsequently.
4. ADVICE, CONSULTANCY & OTHER WORK
4.1 Advice and Consultancy
4.1.1 ALMO (Poole Housing Partnership) – Assistance was provided with regard to the Authority’s work on setting up an Arms Length Management Organisation (ALMO) for Housing Management Services.
4.1.2 Risk Management - Internal Audit and Review are assisting the Management Team and the Head of Financial with the development of a risk management framework.
4.1.3 Audit Plan – The Strategic Audit Plan has been revised in line with the principles of risk management and approved by the Head of Financial Services. An interim review of the plan was carried out in September 2004 to ensure that Internal Audit resources are focused on the appropriate risk areas. This is being presented separately to this Committee for information.
4.1.4 National Fraud Initiative – The Audit Commission’s National Fraud Initiative is a data matching exercise which is designed to help detect fraudulent and erroneous payments from the public purse. The data has been extracted and submitted as required for the 2004 initiative.
4.1.5 Statement of Internal Control – Internal Audit and Review have produced an interim Statement of Internal Control for inclusion with the Statement of Accounts for 2003/04 as required by the Accounts and Audit Regulations 2003. An action plan has been produced to demonstrate the Authority’s commitment to have the necessary supporting systems in place, including risk management across the Authority, for full compliance in 2004/05.
5. RECOMMENDATIONS FOLLOWED UP
5.1 Follow up reviews were carried out to ascertain whether the risks identified in previous audits had been appropriately addressed through implementation of the audit recommendations. The tables below summarise the findings of the follow up audits.
5.2 Performance Information For All Recommendations Followed Up
The information in 5.2.1 to 5.2.3 shows ALL recommendations followed up (i.e. those previously reported to Service Provision and Community Support and Education Scrutiny Committees).
5.2.1 Quarterly Trend Analysis of Recommendations Not Implemented from January 2003 to September 2004
5.2.2 Percentage of ALL Recommendations Not Implemented for January to October 2004
Number of Recommendations Followed UpJanuary – June 2004 / Number of Recommendations Not Implemented During January – June 2004 / % Recommendations Not Implemented
315 / 264 / 16
5.2.3 Age/Priority of ALL Recommendations Not Implemented as at the end October 2004
PriorityTime lapse beyond
Agreed Implementation Date / *** (High) / ** (Medium) / * (Low) / Total
> 1 year / 0 / 0 / 0 / 0
6 – 12 months / 2 / 8 / 4 / 14
3 – 6 months / 2 / 8 / 6 / 16
< 3 months / 0 / 4 / 4
Total / 4 / 20 / 10 / 34
5.2.4 Age/Priority of ‘EDUCATION & COMMUNITY SUPPORT’ Recommendations Not Implemented as at the end of October 2004
PriorityTime lapse beyond
Agreed Implementation Date / *** (High) / ** (Medium) / * (Low) / Total
> 1 year / 0 / 0 / 0 / 0
6 – 12 months / 2 / 8 / 1 / 11
3 – 6 months / 2 / 7 / 5 / 14
< 3 months / 0 / 0 / 0
Total / 4 / 15 / 6 / 25
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5.2.5 Current Progress (at end of October 04) on Non-Implemented Recommendations and Reasons for Non-Implementation (‘EDUCATION & COMMUNITY SUPPORT’
Audit(Service Unit) / No. Original Recs / Recs
Not Implemented / Priority of Recs Not Implemented / Recommendations Not Implemented / Service Unit Head Reasons for Non-Implementation / Further Action Taken
Homecare – day & night (ASSC) / 13 / 8 / 2 ***
5 **
1 * / · Risk appraisal re failure of major provider
· Contingency plan re failure
· Produce formal strategy for Home Care
· Reconciliation to OLAS
· Independent check of calculations
· Contribution amendments authorisation
· Analysis of queries/poor performing providers and formal monitoring system
· Formal training for budget holders / · Currently being
implemented
· Strategy being reviewed / Escalated to Chief Auditor and revised target dates agreed
Adult Learning (Culture & Community Learning) / 18 / 6 / 1***
3**
2* / · Contract Standing Orders Compliance
· Update of outstanding POP orders
· Documentation of procedures
· Update of inventory items
· Reconciliation of activity
· Control of financial stationery / · Staff restructuring
· Lack of resources
· LSC inspection requiring detailed remedial work on action plans / Escalated to Chief Auditor and revised target dates agreed
Devolved Funds (SASS/Financial Services) / 8 / 2 / 2** / · Production of a checklist for review process
· Monitoring of receipt of best value statements from schools / · Checklist to be produced after changes to LMS scheme
· Other priorities / Revised target dates agreed
Turlin Moor Middle (SASS) / 14 / 6 / 1***
2**
3* / · Compliance with Contract Standing Orders
· Update current policy (incl monetary limits)
· Review of fees for lettings
· Procedure notes to be updated
· Submission of Best Value statement
· Enhance security of equipment / · Currently being implemented/completed / Internal Audit awaiting response to current follow up
Corfe Hills (SASS) / 5 / 1 / 1** / · Internet Policy for Staff / · Currently being implemented / Internal Audit awaiting response to current follow up
Haymoor Middle (SASS) / 6 / 2 / 2** / · Confirmation of adoption of DfES guidance
· Agreement of an SLA / · Delayed until full Governors meeting (end Oct 04)
· Awaiting agreement from 3rd party to SLA / Internal Audit to follow up November 04
Note – Recommendations in bold text indicate previously reported to Community Support & Education Scrutiny Committee as ‘Non-implemented’
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6. Investigations and Projects
6.1 Community Support and Education Scrutiny Committee Areas
6.1.1 The Internal Audit Reports on the Hamworthy and Rossmore financial reviews were presented to the Community Support and Education Scrutiny Committee on 16th September 2004. Lessons to be learned to improve the management of capital projects in the future and corresponding improvement action plans were presented to members.
6.1.2 Internal Audit undertook a review into the operation of the Education Asset Management Plan. Several recommendations were made to improve the system and were subsequently implemented by the Service Unit Head.
6.1.3 A review was undertaken into the accuracy of the residential care payments generated by the Social Services Carefirst computer system. Recommendations were made to ensure verification of the accuracy of the payments run for the current financial year and to also ensure the accuracy of future payment runs. Work is currently being undertaken to implement these recommendations.