The Chief Internal Auditor reported on the actual Internal Audit performance against the two months of the audit plan year covering April 2016 to March 2017.  She informed the Committee that the Plan provided for a total of 1,053 productive days, with 1,030 actual days delivered.     

The Chief Internal Auditor reported that the overall structure of Internal Audit was based on 18 Full Time Equivalent (FTE) employees; however at the end of the 2015-16 financial year, the section carried 4 FTE vacant posts, but this had now increased to 9 FTE vacant posts.  A recent recruitment campaign had been unsuccessful in addressing the shortfall and discussions were underway as to the best way to address the shortfall.  

The Chief Internal Auditor informed the Committee that the opinion contained within the outturn report related to the system of internal control at the Council and the overall control environment in place.  She stated that the system of internal control was designed to manage risk to a reasonable level rather than to eliminate the risk of failure to achieve corporate / service policies, aims and objectives.  The Chief Internal Auditor could only provide reasonable and not absolute assurance of effectiveness.  The supporting evidence lists all those assignments which have been commenced / completed for the year and where an assignment has been completed, an audit opinion has been applied. 

The Chief Internal Auditor informed the Committee that on the basis on internal audit work undertaken and taking into account all available evidence, it was her opinion that satisfactory assurance can be applied to standards of internal control at the Council.  She stated that the most significant risk affecting her ability to giving an opinion is the 50% vacancy rate in internal audit.  Discussions on a re-structure which would be based on resilience and career progression had taken place with the trade unions prior to consultation commencing with staff. 

The Committee was disconcerted to learn of the vacancy rate of 50% and it wished to consider the review of resources in internal audit at a future meeting as part of setting the Audit Plan. 

The Committee also expressed concern at the shortfall of actual days achieved compared to the planned days in the Social Services and Wellbeing Directorate.  The Chief Internal Auditor informed the Committee that a contingency had been built into the Internal Audit Plan and additional days had been requested by the Corporate Director Social Services and Wellbeing due to the implementation of the Social Services and Wellbeing Act.  She stated that despite the shortfall in the actual days achieved in Social Services and Wellbeing Directorate she had taken assurance from the CSSIW.              

RESOLVED:            That the Committee considered the Internal Audit Outturn Report, including the Head of Audit’s annual opinion to ensure that all aspects of their core functions are being adequately reported and in doing so, expressed its concern at the vacancy rate of 50% and that it wished to consider the review of resources in internal audit at a future meeting as part of setting the Internal Audit Plan.