Summary of Internal Audit Activity in Partner Organisations 1 October to 25 April 2025 combined
Renfrewshire Council · 19 May 2025
Back to Audit, Risk and Scrutiny Board — 19 May 2025 and its agenda
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___________________________________________________________________ To: Audit, Risk and Scrutiny Board On: 19 May 2025 ___________________________________________________________________ Report by: Chief Auditor ___________________________________________________________________ Heading: Summary of Internal Audit Activity in Partner Organisations 1 October to 25 April 2025 ___________________________________________________________________ 1. Summary 1.1 Members of the Audit, Risk and Scrutiny Committee expressed an interest in the outcomes of audits undertaken in partner organisations. 1.2 This report provides members with a summary of the internal audit arrangements within each partner body and a summary of the internal audit activity from 1 October 2024 to 25 April 2025. 1.3 Renfrewshire Valuation Joint Board – Internal audit services are provided by Renfrewshire Council’s Internal Audit Service. An audit on the non-domestic rates valuation system has been undertaken and will be reported upon to the Renfrewshire Valuation Joint Board. 1.4 Scotland Excel Joint Committee - Internal audit services are provided by Renfrewshire Council’s Internal Audit Service. An audit relating to the governance arrangements of the contract delivery process is currently in progress and will be reported upon to the Executive Sub-Committee once finalised. 1.5 Renfrewshire Integration Joint Board - Internal audit services are provided by Renfrewshire Council’s Internal Audit Service. Audits have been finalised relating to governance and financial planning processes. A summary of these audit engagements are included at appendix 1 and 2 of this report. An exercise to ensure that previous internal audit recommendations have been implemented by their due date was undertaken and Management confirmed all the recommendations were implemented.
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1.6 Glasgow City Region City Deal – Internal audit services are provided by Glasgow City Council Internal Audit Services, finalised reports for each completed audit engagement are reported to the Glasgow City Region Cabinet and the reports are shared with member Council’s. Currently one audit review is ongoing on the financial monitoring and reporting controls carried out by member authorities. A summary of the review will be shared with members once the final report is received. ___________________________________________________________________ 2. Recommendations 2.1 All of these Summaries of the Audit Reports have been submitted and considered by the partner organisations’ audit committees. Members are therefore invited to note the content of these summaries. __________________________________________________________________ Implications of the Report 1. Financial - None 2. HR & Organisational Development - None 3. Community Planning – Safer and Stronger - effective internal audit is an important element of good corporate governance. 4. Legal - None 5. Property/Assets - None 6. Information Technology - None 7. Equality & Human Rights – None 8. Health & Safety – None 9. Procurement - None 10. Risk - The summary reported relates to the delivery of the risk-based internal audit plans for the partner bodies 11. Privacy Impact – None 12. COSLA Implications – None 13. Climate Risk – None 14. Children’s Rights – None.
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________________________________________________________________ Author: Karen Campbell, Interim Chief Auditor
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Appendix 1 Internal Audit Report INTEGRATION JOINT BOARD IJB - Governance Arrangements (B0017/2025/001) Date: February 2025 COMMITTEE SUMMARY Audit Objectives The IJB have developed local governance arrangements that are designed to ensure compliance with, ‘Delivering Good Governance in Local Government: Framework,’ published by CIPFA. The objectives of this audit were to review independently and report annually to the IJB Audit, Risk and Scrutiny Committee: • To provide assurance on the adequacy and effectiveness of the Local Code of Corporate Governance and the extent of compliance with it. • To support the Chief Internal Auditor’s annual opinion included in the Internal Audit Annual Report and the Governance Statement included in the Annual Accounts. Audit Scope 1. Obtained an up-to-date copy of the IJB’s Local Code of Corporate Governance and selected a sample of elements for compliance testing. 2. Obtained the appropriate evidence to confirm compliance with the Code. Key Audit Assurances 1. The Local Code and Sources of Assurance for Governance Arrangements was updated and submitted to the Renfrewshire Integration Joint Board on the 21st of June 2024. 2. Based on our sample check of the evidence used to demonstrate compliance, we would confirm that the IJB complies with the requirements of the Local Code of Corporate Governance. Key Risks No key risks were identified as a result of this audit. Overall Audit Opinion Internal Audit has reviewed the adequacy and effectiveness of the revised Code which was presented to the Renfrewshire Integration Joint Board on the 21st of June 2024. Based on our sample check of the evidence used to demonstrate compliance, we would confirm that the IJB complies with the requirements of the Local Code of Corporate Governance. In addition, it is evident that the Local Code has been subject to regular review and updating in line with developments in best practice. Management Commentary N/A as no key risks were identified.
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Appendix 2 Internal Audit Report IJB Financial Planning (A0114 2025 001) January 2025 COMMITTEE SUMMARY Audit Objectives The objectives of the review were to ensure that financial plans are: • Aligned with the IJB Strategic Plan; • Supported by reasonable assumptions; • Regularly reviewed to adapt to existing and emerging financial risks; • Based on consultation with appropriate people and teams; • Reported to the appropriate senior managers and Boards. Audit Scope 1. Interviewed the appropriate officers to ascertain the systems in place for financial planning. 2. Prepared and carried out a programme of tests to enable the audit objectives to be met. 3. The auditor reviewed financial plans reported to the IJB Board and working papers for some of the cost pressures referred to in financial plans. These related to council recharges, adult supported living planned placements including childcare transitions and prescribing. Key Audit Assurances 1. Financial plans are aligned with the IJB Strategic Plan. Measures to reduce cost pressures referred to in the Strategic Plan are presented in the Medium-Term Financial Plan and annual Delegated Health and Social Care Budget. 2. The sample of components of the Renfrewshire Health and Social Care Budget tested were supported by reasonable assumptions and methodologies to calculate costs. Assumptions for Planned Placements and Prescribing are reviewed and updated by the Finance Team every 4 weeks. We were advised that the same rigour is applied to all other financial planning assumptions. For Planned Placements this includes the average increase in placement costs over the last 3 years being cross checked against a future placement tracker and childcare transitions spreadsheet which is approved / signed off by the Head of Childcare in the Council. For Prescribing, the projected % cost uplift and supporting data for each financial year provided by NHS Finance Prescribing Lead is analysed by the Finance team to project future volume increases and estimated average cost per item for prescribed medicines. 3. Financial plans are scrutinised on a 4-weekly basis by the Finance team to adapt to existing and emerging financial risks and these risks are noted in relevant meeting minutes and reports. Planned Placement budget packages are discussed at Resource Planning meetings to ensure best value before approval by the Head of Service and the Chief Finance Officer. Prescribing reports refer to anticipating future changes which involve assessing future prescribing behaviour, the influence of external drivers of prescribing, and the impact of new medicines coming to the market. 4. Financial plans are prepared after consultation with appropriate stakeholders. Council and RHSCP finance mangers discuss recharges, to ensure that they are fairly calculated. Planned Placements are discussed at Finance & Governance meetings to manage demand pressures for placements and Heads of Service budget monitoring meetings to manage costs and
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Appendix 2 Internal Audit Report IJB Financial Planning (A0114 2025 001) January 2025 savings. Prescribing is discussed at Chief Finance Officer meetings to monitor medicine price and volume increases and Sustainable Futures (Prescribing meetings) to discuss alternatives to currently prescribed medications as well as regular prescribing budget meetings which include the Clinical Director and Lead Pharmacist. 5. The financial plans are reported to the appropriate senior managers and Boards e.g. Due Diligence Report on Support Service Recharges and the Delegated Health and Social Care Budget referring to Planned Placements and Prescribing reported to the IJB. Key Audit Risks If appropriate savings or reductions in services are not identified, there is a risk that Renfrewshire IJB will have insufficient funding to achieve a balanced budget. Overall Audit Opinion The arrangements in place in Renfrewshire Integrated Joint Board for financial planning were found to be robust. The Finance team robustly monitor budgets and fluctuations in cost pressures throughout the financial year (4 weekly). Due to the nature of the budgets including external and internal influences these were found to be particularly complex in the areas reviewed. In September 2024, the IJB’s external auditors stated that there is a critical need to identify recurring savings or reductions in services for Renfrewshire’s IJB to remain financially sustainable. The IJB’s Chief Finance Officer responded that additional savings proposals will be prepared to be considered by the IJB in March 2025, alongside a draft budget for 2025/26 and an updated Medium Term Financial Plan. However, the savings proposals for 2025/26 were taken to the IJB earlier than anticipated, (reflecting the level of savings required to deliver financial balance) in December 2024. Savings of approximately £14m over the next 3 financial years were approved by the Board and savings of approximately £3m were agreed to be progressed over the next 3 financial years which will require further consultation. We have asked for confirmation that the draft budget for 2025/26 and updated Medium Term Financial Plan will be delivered as stated. Management Commentary The Chief Finance Officer confirmed that an updated Medium Term Financial Plan will be taken to the IJB in March 2025 along with the proposed budget for 2025/26. In addition, the sustainable futures programme is the overarching programme to deliver financial sustainability for the IJB and as such reports will be taken to each IJB over the next couple of years with updates on both approved savings and also those which require approval to be taken forward by officers to the next stage prior to being presented to the IJB for approval.