Agenda item

Audit Cotswolds (see recommendation)

Lucy Cater introduced the monitoring report which was designed to give the Audit Committee the opportunity to comment upon the work completed by the partnership and provide ‘through the year’ comment and assurances on the control environment.  The report set out current progress against each of the areas of work and she highlighted the ‘Satisfactory’ assurance for Accounts Payable (Transactional Testing); a random sample of 20 invoices were tested and of these 20, 18 were paid within 30 days, though this was not always within the suppliers terms as set out on the invoice.  Testing identified that two duplicate payments; one due to two invoices having been issued with two different invoice numbers and the other instance due to the fact that the invoice was processed under two different supplier IDs.  These payments did not represent large sums and members were assured that any duplicate payments were in the process of being recouped.  At the time of testing 22% of invoices that were paid had a purchase order and this number had increased to 28% when reviewed again today, however, it was important that members understood that not all payments required a purchase order (utilities, subscriptions, refunds and benefit payments). 

Officers, including the Corporate Governance, Risk and Compliance Officer, Accountant and Internal Audit officers, gave the following responses to member questions;

·         The system will highlight that a payment has already been made, if the same invoice number (against the same supplier code) is entered twice and the fact that payment of invoices if escalated to another officer if someone is on leave or off sick, could explain why some payments were duplicated. 

·         Purchase Orders would mitigate against any risk of duplicate payments regardless of differing invoice numbers/supplier codes.

·         The policy clearly stated which payments were exempt from having a purchase order and which were not.  There was no way of differentiating, on the system, which payments did and did not require a purchase order and therefore it was for Cost Centre Managers to identify invoices which lacked the required purchase order and block the payment.  The Deputy Section 151 Officer was in the process of trying to create and manipulate a report from the system, which could be used to challenge those not adhering to the policy, but given the huge number of payments which were exempt, this was not as quick and/or easy as it may sound and as such, was taking time.   

·         Due to the long term absence of the Head of Audit Cotswolds, it had not been possible to conclude follow-up work in relation to the Art Gallery & Museum and Car Parking.  It was hoped that these would be concluded in time for the next meeting.

·         The 2 Right to Buy applications which had been prevented had been prevented as the applications were being made fraudulently; either the people did not live in the property or they had been dishonest about their circumstances. 

·         The ‘sentences’ referenced in the Counter Fraud Update included fines, suspended sentences, costs and public service. 

·         CBH had an agreed set of costs, but given that these could not be written off the council, the Counter Fraud Unit would be reviewing these costs, with a view to increasing them.

·         Where prosecutions were listed for trial, the accused had pleaded ‘not guilty’. 

Members were concerned that it was still not possible to confirm whether the council was compliant with its policy; that stated that all invoices (not including those that are exempt) must have a purchase order before payment could be made.  They asked that a briefing be produced in time for the next meeting (15 June) that included; a diagram of the process associated with each kind of payment (exempt, with purchase order and without purchase order), the level of compliance at the time of writing the briefing, a timescale for being 100% compliant (if not already) and details of consequences for any officers identified as not adhering to the policy on a regular basis. 

Upon a vote it was unanimously

RESOLVED that the Internal Audit Monitoring Report be noted.