The Chief Internal Auditor presented a report to Members of the Committee on her (i.e.as Head of Internal Audit) annual opinion on the overall adequacy of the Council’s internal control environment.

The report gave a brief description of the role of Internal Audit, the control environment within which Internal Audit operated and a summary of work carried out during the period April 2014 to March 2015.  A statement of overall opinion on the internal control environment was also given in support of the Annual Governance Statement which the Council is required to include with the Statement of Accounts.

She explained that Internal Audit is an assurance function that primarily provides an independent and objective opinion to the organisation on the control environment comprising risk management, internal control and governance by evaluating its effectiveness in achieving the organisation’s objectives, including its policies, procedures and operations that are in place.

In giving her opinion on internal control she stated that no system of control can provide absolute assurance against material misstatement or loss, nor can internal audit give that assurance.  She explained that the matters raised in the report are only those which have come to attention during internal audit work and are not necessarily a comprehensive statement of all the weaknesses that exist, or of all the improvements that may be required.

In arriving at the overall opinion, the Head of Audit had taken into account:

·         The results of all audits undertaken as part of the audit programme - April 2014 to March 2015.

·         The results of follow-up action of audits from current and previous years;

·         Whether or not “high risk” recommendations have been accepted by management and the consequent risks;

·         The effects of any material changes in the Council’s objectives or activities or risk profile;

·         Whether any limitations have been placed on the scope of audit;

·         Findings of work performed by other assurance providers (e.g. Wales Audit Office, Council’s External Auditors and Regulatory bodies – KPMG, CSSIW and ESTYN).

Therefore, the Head of Audit’s opinion, taking into account all available evidence, the adequacy and effectiveness of internal control at BCBC the assurance rating given is reasonable. 

She has explained that during the period, nine reviews have identified weaknesses in control at a level where only limited assurance and one where no assurance could be given and management have given written assurance that the recommendations made will be implemented to address the weaknesses identified (these specific reports have been reported to the Audit Committee and Internal Audit has already revisited the ten reviews (including the No Assurance audit) to follow up on progress, and have deemed the overall internal control environment to be reasonable in each follow up review. 

She then informed Members that The Vale of Glamorgan Council leads the Bridgend and Vale Internal Audit Shared Service and provides all internal audit services to its partner Bridgend County Borough Council.  She stated that as of 31 March 2015 the total resource for the internal Audit service is 18.5 Full Time Equivalents, with 2.5FTE posts currently vacant. The Chief Internal Auditor advised that a further update on this would be provided at the next Committee.

RESOLVED:    That Members gave due consideration to the Head of Internal Audit’s Annual Opinion covering the period April 2014 to March 2015 and ensured that all aspects of their core functions are being adequately reported.