2025_25_InternalAudit_HSCP_Governance Arrangements_Final
Argyll and Bute Council · 16 December 2025
Back to Audit and Scrutiny Committee — 16 December 2025 and its agenda
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Argyll & Bute Health & Social Care Partnership Internal Audit Report September 2025 FINAL High Medium Low VFM Number of Findings 0 0 2 0 Review Of Governance Arrangements Audit Opinion: High
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2 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 Contents 1. Executive Summary ........................................................................................................................ 3 Introduction ............................................................................................................................................ 3 Background ............................................................................................................................................. 3 Scope ....................................................................................................................................................... 3 Key Dates ................................................................................................................................................ 3 Risks ........................................................................................................................................................ 4 Audit Opinion ......................................................................................................................................... 4 Recommendations ................................................................................................................................. 4 2. Objectives and Summary Assessment ........................................................................................... 4 3. Detailed Findings ............................................................................................................................ 5 Appendix 1 – Action Plan ....................................................................................................................... 9 Appendix 2 – Audit Opinion ................................................................................................................. 11 Contact Details Internal Auditor: David Sullivan Telephone: 01546 604125 e-mail: David.sullivan@argyll-bute.gov.uk www.argyll-bute.gov.uk
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3 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 1. Executive Summary Introduction 1. As part of the 2025/26 internal audit plan, approved by the Audit & Risk Committee in February 2025, we have undertaken an audit of Argyll & Bute Health & Social Care Partnership (HSCP) system of internal control and governance in relation to Review of Governance arrangements. 2. The audit was conducted in accordance with the Global Internal Audit Standards (GIAS) with our conclusions based on discussions with Health & Social Care Partnership officers and the information available at the time the fieldwork was performed. The findings outlined in this report are only those which have come to our attention during our normal audit work and are not necessarily all the issues which may exist. Appendix 1 to this report includes agreed actions to strengthen internal control however it is the responsibility of management to determine the extent of the internal control system appropriate to the HSCP. 3. The contents of this report have been agreed with the appropriate Health & Social Care Partnership officers to confirm factual accuracy, and appreciation is due for the cooperation and assistance received from all officers over the course of the audit. Background 4. The purpose of this audit is to ensure that the governance framework remains fit for purpose, complies with good practice standards, and is reviewed regularly. 5. The governance structure of the HSCP includes the Integration Joint Board (IJB), sub- committees, and partnership arrangements with NHS Highland and Argyll & Bute Council. This audit supports the HSCP’s commitment to continuous improvement, transparency, and accountability in decision-making processes. Scope 6. The scope of the audit was to provide assurance that the HSCP’s governance arrangements are periodically reviewed and fit for purpose as outlined in the Terms of Reference agreed with the Head of Service and Transformation on 12th May 2025. Key Dates 7. The Terms of Reference provided provisional timescales for the review to take place, the actual dates are noted in Exhibit 1 below. Exhibit 1 – Key Dates Stage Actual Date Terms of Reference agreed 12th May 2025 Fieldwork Commencement 15th June 2025 Draft Report issued 11th July 2025 Management Comments received 18th July 2025 Final Report issued 8 September 2025 Audit and Risk Committee 23 September 2025
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4 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 Risks 8. The risks considered throughout the audit were: • SRR04: Governance and Leadership – risk that governance arrangements are not conducive to effective working. • Audit Risk 1: Governance documents are not reviewed regularly or are outdated. • Audit Risk 2: Roles and responsibilities of key decision-makers are unclear or inconsistently understood. • Audit Risk 3: Governance decisions are not transparent or appropriately documented. • Audit Risk 4: The Integration Joint Board (IJB) make decisions that are out with its legal powers (ultra vires), potentially leading to legal or financial repercussions. Audit Opinion 9. We provide an overall audit opinion for all the audits we conduct. This is based on our judgement on the level of assurance which we can take over the established internal controls, governance and management of risk as evidenced by our audit work. Full details of the five possible categories of audit opinion is provided in Appendix 2 to this report. 10. Our overall audit opinion for this audit is that we can take a high level of assurance. This means that Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. Recommendations 11. We have highlighted 2 low priority recommendations where we believe there is scope to strengthen the control and governance environment. These are summarised below: • A governance roles guide and organisational chart should be developed to clarify officer responsibilities and committee reporting lines. • Information on IJB member training and induction should be published to enhance transparency for stakeholders and potential board members. 12. Full details of the audit findings, recommendations and management responses can be found in Section 3 of this report and in the action plan at Appendix 1. 2. Objectives and Summary Assessment 13. Exhibit 1 sets out the control objectives identified during the planning phase of the audit and our assessment against each objective.
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5 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 Exhibit 2 – Summary Assessment of Control Objectives Control Objective Link to Risk Assessment Summary Conclusion CO1 Governance documents are reviewed periodically and updated accordingly SRR04 / Audit Risk 1 Audit Risk 4 High The HSCP governance framework is well-documented, formally approved, and reviewed in accordance with statutory and good practice standards. Evidence from IJB minutes confirms oversight and review activity has been performed. The existence of formal schedules and version controls supports ongoing governance arrangements. CO2 Roles and responsibilities within the governance structure are clearly defined and understood. Audit Risk 2 High The governance structure and responsibilities within the Argyll & Bute HSCP are clearly laid out in governance documents and reflect good practice. While role clarity is strong, additional improvements could be made by enhancing accessibility and communication of these responsibilities and training expectations CO3 Governance meetings are properly documented, and decisions are transparent and traceable. Audit Risk 3 High The HSCP’s governance framework promotes transparency, stakeholder accessibility, and clear documentation of decisions. Strategic plan performance and audit recommendations are actively monitored. Governance interactions between the IJB, Council, and NHS Highland are well-established. The IJB prepares an Annual Governance Statement. 14. Further details of our conclusions against each control objective can be found in Section 3 of this report. 3. Detailed Findings Governance documents are reviewed periodically and updated accordingly 15. The Joint Strategic Plan (2022–2025) sets out the HSCP’s vision, priorities, and integrated service delivery objectives over a three-year period. Developed following a formal consultation process, it defines governance principles, planning cycles, and performance expectations. The document outlines the governance responsibilities of the Integration Joint Board, the Chief Officer, and strategic partners, and is aligned with national health and social care integration policy and the Public Bodies (Joint Working) (Scotland) Act 2014. 16. The HSCP has a well-documented governance framework comprising all key components expected under statutory and good practice standards. These include the IJB Standing Orders
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6 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 (v3.4, approved January 2025), committee Terms of Reference (v2.4), the Integration Scheme, and the 2022–2025 Joint Strategic Plan. Collectively, these documents define governance procedures, membership structures, delegated authority, and partnership responsibilities. They are subject to regular review, include version control, and are publicly accessible, supporting transparency and accountability. 17. The Standing Orders (v3.4, January 2025) provide a comprehensive and up-to-date procedural framework for the Integration Joint Board. They clearly define the governance structure, including the distinction between voting and non-voting members, and outline key responsibilities for the Chair, Vice Chair, and Chief Officer. The document includes detailed provisions on decision-making, quorum, delegation of functions, and the conduct of meetings. The inclusion of version control and regular review cycles further demonstrates alignment with national policy and good governance practice. 18. The key governance documents of the HSCP have all been formally reviewed and approved within appropriate statutory and operational timeframes. The Standing Orders (v3.4) were reviewed and approved in May 2025, with version control confirming a biennial review cycle. The Strategic Plan 2022–2025 was approved in 2022 and remains current, with provisions for a mid-cycle review if required. The Integration Scheme was last reviewed in 2021 and approved by Scottish Ministers, with the next review due by 2026. The Terms of Reference for IJB committees (v2.4) were reviewed and approved in March 2025. These approvals are documented in official IJB minutes, and all documents contain version controls and embedded review schedules, evidencing structured and compliant governance oversight. 19. All core governance documents include version control and scheduled review cycles. These align with statutory expectations: five years for the Integration Scheme, three years for the Strategic Plan, and annual review for committee Terms of Reference. Roles and responsibilities within the governance structure are clearly defined and understood. 20. The audit reviewed the governance framework, key documentation, and training provisions to assess whether the roles and responsibilities of key officers and committees are clearly defined and communicated. 21. The roles and responsibilities of key officers within the HSCP are clearly defined and consistently communicated through core governance documents, including the Standing Orders (v3.4), Strategic Plan 2022–2025, and Integration Scheme. The Chief Officer is designated as the lead accountable officer, with responsibilities covering strategic delivery, operational oversight, and liaison with partner bodies. The Standing Orders also outline the duties of the Chair and Vice Chair, including meeting leadership and adherence to procedural standards, as well as the functions of the Standards and Monitoring Officers in relation to conduct and compliance. These responsibilities are further reinforced through board appointments and formal reporting. These arrangements promote transparency, accountability, and clarity of governance roles. A summarised governance roles guide or organisational chart could further improve accessibility for stakeholders and new members. Action Plan 1 22. The structure of the IJB and its subcommittees is clearly defined and aligned with good governance practice. The Standing Orders detail the governance framework, including
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7 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 membership composition, quorum rules, decision-making processes, and provisions for establishing subcommittees. Key roles and delegation arrangements are stated, supporting accountable leadership and operational delivery. The Strategic Plan further reinforces this structure, highlighting the roles of strategic and operational committees, such as the Finance and Audit Committee. The governance model reflects best practice, with defined responsibilities, clear reporting lines, and a Chief Officer accountable to both partner organisations. To enhance accessibility, a visual governance chart showing committee relationships and officer accountabilities could be developed to support stakeholder understanding. Action Plan 1 23. The governance structure is well defined, comprising strategic oversight by the IJB, operational delegation to the Chief Officer, and supporting subcommittees for finance, audit, clinical governance, and strategic planning. 24. Subcommittees have documented Terms of Reference, reviewed and approved by the IJB in March 2025, outlining purpose, responsibilities, membership, and reporting lines. 25. The IJB has established appropriate arrangements for the induction and ongoing development of its members. New members are supported through structured induction programmes and board development sessions to ensure they understand their roles and responsibilities within the governance framework. The Strategic Plan confirms that Performance Development and Review (PDR) schemes are in place through each partner agency, promoting individual growth aligned with organisational objectives. In addition, the HSCP offers a range of accessible training courses on key topics such as mental health and suicide prevention, which are open to both staff and IJB members. These arrangements reflect a strong commitment to maintaining effective governance participation. Publishing further detail on induction and training provisions via the IJB’s website could enhance visibility and support stakeholder engagement. Action Plan 2 Governance meetings are properly documented, and decisions are transparent and traceable. 26. The audit reviewed whether governance decisions of the HSCP are transparent, accessible to stakeholders, and supported by clear reporting, oversight structures, and assurance mechanisms. 27. Governance documentation, including IJB agendas, reports, and minutes, are routinely published via the Argyll and Bute Council website. Reports typically include background, options, decisions, and recommendations in full, supporting public accountability. Agendas, reports, and approved minutes are routinely published on the Argyll and Bute Council website in a dedicated IJB section, ensuring that stakeholders can access key decisions, background papers, and recommendations in a timely manner. The Standing Orders reinforce this approach by explicitly supporting open meetings, in line with statutory obligations under the Public Bodies (Joint Working) (Scotland) Act 2014. Examples such as the 27 March 2024 meeting confirm that governance decisions are documented and presented in an accessible format. These practices promote visibility, trust, and effective stakeholder engagement. 28. Governance arrangements between the HSCP, Argyll and Bute Council, and NHS Highland are underpinned by the Integration Scheme and Standing Orders, which clearly define the statutory
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8 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 delegation of functions and responsibilities. The Chief Officer is jointly accountable to the IJB and both partner organisations, ensuring that strategic decisions are implemented across NHS and Council structures. While the IJB determines strategic direction and budget allocations, operational delivery remains with the parent bodies. This model is supported by joint oversight mechanisms and shared reporting through audit and governance structures. 29. The IJB complies with statutory requirements by preparing, reviewing, and publishing an Annual Governance Statement (AGS) as part of its audited annual accounts. The 2023–24 AGS, approved on 26 March 2025, provides a comprehensive summary of the IJB’s governance arrangements and internal control environment. It is subject to both internal review and external audit scrutiny, with the auditor confirming that the statement fairly reflects the IJB’s risk assurance and governance framework. This process offers assurance to stakeholders regarding the effectiveness and transparency of governance practices within the HSCP. 30. The HSCP has established governance arrangements to support strategic risk management. The Strategic Risk Register (SRR) was formally reviewed and approved by the Leadership Team and the Audit & Risk Committee in December 2024, with subsequent scrutiny by the Integration Joint Board in January 2025. The SRR is actively aligned to the Joint Strategic Plan through a structured mapping exercise, demonstrating how key risks relate to strategic objectives. Overall, the risk governance framework is compliant, well-documented, and subject to regular review, reinforcing effective risk-informed decision-making at a strategic level.
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Appendix 1 – Action Plan No Finding Risk Agreed Action Responsibility / Due Date Low 1 A summarised governance guide, including an organisational chart that outlines officer responsibilities and committee reporting lines, would improve accessibility for new members and external stakeholders. Without a clear and accessible governance guide, there is a risk that new members, staff, and stakeholders may lack a full understanding of roles, accountability structures, and decision-making processes. HSCP will develop a concise governance summary guide, including officer responsibilities and reporting lines. Business Improvement Manager 30th April 2026 Low 2 While training provisions are evident, details of IJB member training and induction are not currently published publicly. This limits transparency for stakeholders and potential board members. The absence of publicly available information on IJB member training and induction may reduce stakeholder confidence in governance capability and discourage potential candidates from engaging with the IJB. HSCP will on an ongoing basis publish a summary of the training and induction programme provided to IJB members, including any development opportunities Business Improvement Manager 30th April 2026
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10 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 In order to assist management in using our reports a system of grading audit findings has been adopted to allow the significance of findings to be ascertained. The definitions of each classification are as follows: Grading Definition High A major observation on high level controls and other important internal controls or a significant matter relating to the critical success of the objectives of the system. The weakness may therefore give rise to loss or error. Medium Observations on less significant internal controls and/or improvements to the efficiency and effectiveness of controls which will assist in meeting the objectives of the system. The weakness is not necessarily substantial however the risk of error would be significantly reduced if corrective action was taken. Low Minor recommendations to improve the efficiency and effectiveness of controls or an isolated issue subsequently corrected. The weakness does not appear to significantly affect the ability of the system to meet its objectives. VFM An observation which does not highlight an issue relating to internal controls but represents a possible opportunity for the HSCP to achieve better value for money (VFM).
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11 Argyll & Bute Health & Social Care Partnership – Internal Audit Report – Review of Governance arrangements, September 2025 Appendix 2 – Audit Opinion Level of Assurance Definition High Internal control, governance and the management of risk are at a high standard. Only marginal elements of residual risk have been identified with these either being accepted or dealt with. A sound system of control designed to achieve the system objectives is in place and being applied consistently. Substantial Internal control, governance and the management of risk is sound. However, there are minor areas of weakness which put some system objectives at risk and specific elements of residual risk that are slightly above an acceptable level and need to be addressed within a reasonable timescale. Reasonable Internal control, governance and the management of risk are broadly reliable. However, whilst not displaying a general trend, there are areas of concern which have been identified where elements of residual risk or weakness may put some of the system objectives at risk. Limited Internal control, governance and the management of risk are displaying a general trend of unacceptable residual risk above an acceptable level and placing system objectives are at risk. Weakness must be addressed with a reasonable timescale with management allocating appropriate resources to the issues raised. No Assurance Internal control, governance and the management of risk is poor. Significant residual risk and/or significant non-compliance with basic controls exists leaving the system open to error, loss or abuse. Residual risk must be addressed immediately with management allocating appropriate resources to the issues.