Agenda item

Report of Internal Audit Manager.

The Committee considered the report of the Internal Audit Manager regarding a summary of the activities of Internal Audit for the third quarter of the financial year 2014/15.

A list of all final audit reports issued from 1st April to 31 December 2014 and the level of assurance attained were detailed in the report. The Committee was advised that during this quarter, no reports had been issued with an assurance level of inadequate.

Audit work carried out to date against the audit plan to the end of December 2014 was set out in appendix A. The Internal Audit Manager made reference to the main points from the appendix which was the annual audits for BDO and the review of Government Connect, which was originally carried out as four separate reviews but was later collated into one and took longer than anticipated. Further details were contained in the report.

From the second half of December 2014, work in internal audit focused on the annual audits. The Committee were advised that any time left at the end of the financial year would be spent completing as many reviews from the plan as possible. Any reviews not completed would be automatically moved to the annual plan for the next financial year.

Further information on reports issued in final during the year with an assurance level below excellent was set out in Appendix B, with any issues highlighted in the reviews which informed the assurance level given. The Committee were reassured that these were the assurance level given at the time the final report was issued and did not reflect recommendations that had been addressed.

A brief explanation for a number of outstanding high and medium priority recommendations from audits, reasons why they had not been implemented along with the month when the next follow up date was due was set out in appendix C. Key items from the appendix was set out in the report.

The comments made by the Corporate Management Team and officers following consideration of outstanding high risks was set out in appendix D. Appendix D was designated as confidential to reduce the risk of opportunities to commit fraud.

The Committee was advised that no frauds over £10k were recorded in the third quarter of 2014/15 and only one fraud over £10k had been identified for this year.

The Corporate Fraud Investigations Manager addressed the Committee detailing the Corporate Fraud section of the report. The Committee was advised that all relevant Housing Benefit investigations had been migrated over to the Single Fraud Investigation Service (SFIS) at the Department for Work and Pensions (DWP) before 1 November 2014. 64 allegations of fraud had been reported to DWP since that date. The Council’s Single Point of Contact Officer recorded that around 1½ hours were being spent per case.

The Council had been successful in securing three bids for Counter Fraud Funding from the Department for Communities and Local Government, including an East Sussex Fraud Hub which would be project led by Eastbourne, High Risk Intervention work to be undertaken for Council Tax Reduction cases and a country wide Fraud APP project which would allow members of the public to report fraud and learn about fraud trends in their area. Further details were contained in the report.

The Corporate Fraud team had commenced Single Person Discount review checks for the Revenues Department, in addition to other reviews around class L exemptions (mortgage provider in possession) and student discounts.

The Committee was also advised that time had been spent researching the Housing Department’s systems and processes, assisting to identify where frauds were most likely to occur, through the processes from homeless application to allocation. As a result four applications for homelessness had been disallowed and withdrawn. A fraud review of the Housing Waiting list had been undertaken and led to two cases of keys being obtained from a tenant, allowing properties to be reallocated.

A brief investigation had been undertaken when a member of the public had used the Town Hall as their correspondence address whilst purchasing a property in France. The conclusion of this investigation resulted in a Single Person Discount being disallowed for 6 months.

The Committee enquired about the new member of staff that had been appointed after the IT Auditor left the authority. The Internal Audit Manager responded that they had recently completed their first audit and three annual reviews to a high standard. The Committee were further advised that another member of the audit team would be retiring and this was equivalent to a full time post.

The Committee recognised with thanks the audit outturns, which demonstrated that despite all the changes occurring through the authority, officers had been diligent in ensuring work had been completed in the correct way.

RESOLVED: That the report be noted.