Agenda Document Pack - Audit and Scrutiny Committee - 12/03/2026
North Ayrshire Council · 12 March 2026
Back to Audit and Scrutiny Committee — 12 March 2026 and its agenda
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North Ayrshire Council, Cunninghame House, Irvine KA12 8EE Audit and Scrutiny Committee A Meeting of the Audit and Scrutiny Committee of North Ayrshire Council will be held in the Council Chambers, Ground Floor, Cunninghame House, Irvine, KA12 8EE on Thursday, 12 March 2026 at 10:00 to consider the undernoted business. Meeting Arrangements - Hybrid Meetings This meeting will be held on a predominantly physical basis but with provision, by prior notification, for remote attendance by Elected Members in accordance with the provisions of the Local Government (Scotland) Act 2003. Where possible, the meeting will be live-streamed and available to view at https://north-ayrshire.public- i.tv/core/portal/home. 1 Declarations of Interest Members are requested to give notice of any declarations of interest in respect of items of business on the Agenda. 2 Minutes The accuracy of (a) the Minutes of the Meeting of the Audit and Scrutiny Committee held on 29 January 2026 will be confirmed and the Minutes signed in accordance with Paragraph 7 (1) of Schedule 7 of the Local Government (Scotland) Act 1973. 3 Elected Member Requests 2025 Mid-Year Report Submit report by the Head of Democratic Services informing of the Council's performance relating to Elected Member requests handled in the first six months of Financial Year 2025/26 (copy enclosed). 1
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North Ayrshire Council, Cunninghame House, Irvine KA12 8EE 4 Code of Corporate Governance Submit report by the Head of Democratic Services to seek approval of Code of Corporate Governance Statement for the Financial Year 2026/27 (copy enclosed). 5 Internal Audit Plan 2025/26: Progress Update Submit report by the Head of Finance to provide an update on progress made in delivering the 2025/26 Internal Audit Plan (copy enclosed). 6 Internal Audit and Corporate Fraud Action Plans: Quarter 3 Update Submit report by the Head of Finance to advise on the progress made by Council Services in implementing the agreed actions from Internal Audit and Corporate Fraud reports as at 31 December 2025 (copy enclosed). 7 External Audit Plan 2025/26 Submit report by the Head of Finance to inform of the External Audit Plan for 2025/26 (copy enclosed). 8 Internal Audit Reports Issued Submit report by the Head of Finance to inform of the findings of Internal Audit work completed since January 2026 (copy enclosed). 9 Internal Audit Plan 2026/27 Submit report by the Head of Finance to inform of the proposed internal audit plan for 2026/27 (copy enclosed). 10 Standing Item of Business: Consideration of future business for scrutiny 11 Urgent Items Any other items which the Chair considers to be urgent. 2
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North Ayrshire Council, Cunninghame House, Irvine KA12 8EE Webcasting Please note: this meeting may be filmed/recorded/live-streamed to the Council's internet site and available to view at https://north-ayrshire.public- i.tv/core/portal/home, where it will be capable of repeated viewing. At the start of the meeting, the Provost/Chair will confirm if all or part of the meeting is being filmed/recorded/live-streamed. You should be aware that the Council is a Data Controller under the Data Protection Act 2018. Data collected during the webcast will be retained in accordance with the Council’s published policy, including, but not limited to, for the purpose of keeping historical records and making those records available via the Council’s internet site. Generally, the press and public will not be filmed. However, by entering the Council Chambers and using the press or public seating area, you acknowledge that you may be filmed and that any information pertaining to you contained in the video and oral recording of the meeting will be used for webcasting or training purposes and for the purpose of keeping historical records and making those records available to the public. In making this use of your information the Council is processing data which is necessary for the performance of a task carried out in the public interest. If you have any queries regarding this and, in particular, if you believe that use and/or storage of any particular information would cause, or be likely to cause, substantial damage or distress to any individual, please contact dataprotectionofficer@north-ayrshire.gov.uk 3
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North Ayrshire Council, Cunninghame House, Irvine KA12 8EE Audit and Scrutiny Committee Sederunt John Bell (Chair) Donald Reid (Vice Chair) Cameron Inglis Shaun Macaulay Tom Marshall Matthew McLean Davina McTiernan Donald L. Reid John Sweeney Chair: Apologies: Attending: 4
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Audit and Scrutiny Committee 29 January 2026 At a Meeting of the Audit and Scrutiny Committee of North Ayrshire Council at 10.00 a.m. involving participation by remote electronic means and physical attendance within the Council Chambers, Irvine. Present (Physical Participation) John Bell, Donald Reid and John Sweeney. Present (Remote Participation) Eleanor Collier, Tom Marshall and Donald L Reid. In Attendance D. Hammond, Executive Director; Y. Baulk, Head of Housing and Public Protection, and S. McKenzie, Senior Manager (Protective Services) (Communities and Housing); S. Anson, Executive Director; and A. McClelland, Head of Education Service (Education); E. Stewart, Head of Children, Families and Criminal Justice; and J. Inglis, Senior Manager (Children and Families) (Health and Social Care Partnership); L. Cree, Head of Sustainability, Transport and Corporate Property (Place); M. Boyd, Head of Finance; and P. Brown, Senior Manager (Audit, Fraud, Safety & Risk) (Finance); A. Craig, Head of Democratic Services; I. Cruickshanks, Senior Manager (Policy, Performance and Democracy); S. Wilson, Committee Services Officer, and M. Sugden, Communications Officer (Media and Internal Communications) (Democratic Services) (Corporate Services). Also In Attendance D. Jamieson (Audit Scotland) Chair Councillor Bell in the Chair. Apologies Cameron Inglis and Davina McTiernan. 1. Declarations of Interest There were no declarations of interest by Members in terms of Standing Order 11 and Section 5 of the Code of Conduct for Councillors 2. Minutes The accuracy of the Minutes of the Meeting of the Audit and Scrutiny Committee held on 20 November 2025 will be confirmed and the Minutes signed in accordance with Paragraph 7 (1) of Schedule 7 of the Local Government (Scotland) Act 1973. Agenda Item 2 5
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3. 2025/26 Mid-Year Complaint Report Submitted report by the Head of Democratic Services informing of the Council's complaint performance and volumes and trends of complaints received in the first six months of Financial Year 2025/26. The 2025/26 Mid-Year Complaint Report was attached at Appendix 1 to the report. Officers responded to Members’ questions and the Committee agreed to note the report and the information provided. The Committee also noted that the mid-year report on Elected Member requests would be presented to the next Committee. 4. Our Performance Management Strategy 2023-28 (October 2025 Refresh) Submitted report by the Head of Democratic Services enabling scrutiny of Our Performance Management Strategy 2023-28 (October 2025 Refresh) following an update to reflect changes in legislation since January 2024. Officers responded to Members’ questions and the Committee agreed to note (a) Our Performance Management Strategy attached at Appendix 1 to the report; and (b) that it will be published on the council website. 5. Our Council Plan Progress Report – Mid Year 2025 to 2026 and LGBF Analysis (October 2025 Data Release) Submitted report by the Head of Democratic Services advising on progress in delivering Our Council Plan 2023-2028 as at Mid-Year 2025-2026. Officers responded to Members’ questions and the Committee agreed to note (a) the Mid-Year Report attached at Appendix 1 to the report; and (b) the status of the Council’s performance indicators within the LGBF Analysis of the October 2025 Data Release attached at Appendix 2 to the report. 6. The Purpose and Use of Glow in North Ayrshire Education Service Submitted report by the Executive Director of Education providing an overview of the key features of the national education digital platform, Glow, and how it is used in practice across Education in North Ayrshire. Officers responded to Members’ questions and the Committee agreed to note the contents of the report. 7. Early Years Development Concerns – Assurance Report Submitted report by the Director of Health and Social Care Partnership providing assurance of the focus on early years developmental concerns as a priority within the Children and Families Health Team, through the Universal Health Visiting Pathway and wider service functions. Officers responded to Members’ questions and the Committee agreed to note the contents of the report. 6
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8. Food Law Enforcement Actions Audit by Food Standards Scotland Submitted report by the Executive Director of Communities and Housing advising of Food Standards Scotland’s findings in relation to the arrangements in place in North Ayrshire Council to ensure adequate and effective food law enforcement across the Council area. The Local Authority Food Law Enforcement Actions Audit June 2025 was attached at Appendix 1 to the report. Officers responded to Members’ questions and the Committee agreed to note (a) the positive findings of the audit by Food Standards Scotland (FSS); and (b) that further work will be carried out internally, and in conjunction with FSS, to improve the accuracy of data transferred from the Council’s database to the Scottish National Database (SND). 9. Internal Audit Reports Issued Submitted report by the Head of Finance informing of the findings of Internal Audit work completed since November 2025. The Committee agreed to note the outcomes from the Internal Audit work completed. 10. Standing Item of Business : Consideration of Future Business for Scrutiny Members were invited to consider potential items of scrutiny business for future meetings. Councillor Collier requested a report outlining the Council's roads maintenance and repairs policies and procedures, including the arrangements for works led by the Council and those delivered by third parties. The report was requested to include information on how this is monitored, enforced and implemented, as well as how the Council liaises with third parties in relation to works in common areas, including co- ordination and scheduling, and the reinstatement of road markings. Councillor Donald L Reid requested a report on the work carried out by the Council to implement the updated Protected Vulnerable Group (PVG) Scheme membership for all regulated roles with children and protected adults in line with the implementation of the Disclosure (Scotland) Act 2020 and changes made to the Protected Vulnerable Group (PVG) Scheme. 11. Urgent Items There were no urgent items. The meeting ended at 11.40 a.m. The full meeting proceedings can be viewed at https://north-ayrshire.public-i.tv/core/portal/home 7
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PUBLIC INFORMATION PUBLIC INFORMATION NORTH AYRSHIRE COUNCIL 12 March 2026 Audit and Scrutiny Committee Title: Elected Member requests 2025 Mid-Year Report Purpose: To inform the Audit and Scrutiny Committee of the Council's performance relating to Elected Member requests handled in the first six months of Financial Year 2025/26. Recommendation: That the Committee notes the report and the information provided. 1. Executive Summary 1.1 This report details Elected Member requests information covering the period 1 April 2025 to 30 September 2025 (referred to in the report as H1 2025). 2. Background 2.1 This section contains information and commentary on Elected Member requests handled by the Council during H1 2025. 2.2 Volume of Elected Member requests actioned Volume of requests actioned during period 1,600 2.2.1 Councillor requests can be handled by Services under two stages: Stage One – non-complex requests with a timescale to action of 5 working days Stage Two – complex requests with a timescale to action of 20 working days Agenda Item 3 9
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PUBLIC INFORMATION PUBLIC INFORMATION 2.2.2 The table below details all Councillor requests actioned during the period: H1 2025 Stage One requests actioned 1,068 Stage One requests actioned on time 877 % Stage One requests actioned on time 82% Stage Two requests actioned 1 Stage Two requests actioned on time 1 % Stage Two requests actioned on time 100% Total % of requests actioned on time 82% 2.2.3 Year on Year comparison 2.2.4 The table below shows a comparison of the % of Councillor requests actioned on time over the last three years: Councillor Requests H1 2023 H1 2024 H1 2025 Stage One requests actioned 1,232 1,228 1,068 Stage One requests actioned on time 1.030 1,084 877 % Stage One requests actioned on time 84% 88% 82% Stage Two requests actioned 0 0 1 Stage Two requests actioned on time n/a n/a 1 % Stage Two requests actioned on time n/a n/a 100% Total % of requests actioned on time 84% 88% 82% 2.3 Volume of requests per Directorate 2.3.1 Councillor Stage One requests (5 working day timescale to action) Directorate Department No. of requests actioned No. actioned on time % actioned on time Average no. of days to resolve Stage Ones Target (days) Corporate Services Customer Services 13 8 62% 10 5 Legal Services 7 6 86% 3 5 Communities & Housing Community Facilities 3 3 100% 4 5 Community Learning & Dev. 4 2 50% 9 5 Sports & Activity 4 2 50% 10 5 Building Services 32 30 94% 3 5 Housing 223 200 90% 4 5 Planning 11 10 91% 2 5 Protective Services 14 12 86% 3 5 10
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PUBLIC INFORMATION PUBLIC INFORMATION Education Education 28 27 96% 2 5 Facilities Management 9 7 78% 4 5 Place Roads 231 202 87% 3 5 Streetscene 192 153 80% 4 5 Waste 136 121 88% 3 5 Regeneration 6 3 50% 9 5 PMI 63 51 81% 4 5 Health & Social Care Partnership Finance/Transformation 2 2 100% 5 5 Health & Community Care 75 30 40% 8 5 Mental Health 12 6 50% 8 5 Other 3 2 67% 4 5 1,068 877 82% 4 5 2.3.2 Councillor Stage Two requests (20 working day timescale to action) Directorate Department No. of requests actioned No. actioned on time % actioned on time Average no. of days to resolve Stage Ones Target (days) Communities & Housing Community Facilities 1 1 100% 15 20 1 1 100% 15 20 2.3.3 MP/MSP requests 2.3.4 These requests have a set timescale of 10 working days to action and the table below details the requests actioned over the last three years: H1 2025 Requests actioned 531 Requests actioned on time 419 % of requests actioned on time 79% 2.3.5 Elected Member requests that did not meet timescale was due to multiple factors, including: • employee availability for approving responses prior to issue and/or assisting with investigating requests • reduced resources • further information required to respond to requests • In July, the Council replaced EMPro (formerly called Lagan) with a new system called the CRM and back-office users experienced some issues with the new system as it was being embedded. 2.3.6 Whilst 82% of Stage One Councillor requests were closed on time, some not closed on time required detailed investigation so could have been handled at Stage Two, thereby reducing the number that breached timescale. 11
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PUBLIC INFORMATION PUBLIC INFORMATION 2.4 Recording Councillor requests 2.4.1 The table below shows how Councillor requests were logged throughout the period: Volume % Volume of Councillor requests recorded 1,069 Volume logged by Councillors 525 49% Volume logged by Member Services 246 23% Volume logged via other channels 298 28% 2.4.2 In relation to the 525 requests logged by Councillors, 15 used their NAC online Member accounts to log their requests themselves. 2.5 Follow up actions for Councillor requests 2.5.1 At a previous Audit and Scrutiny Committee, Members noted that some Councillor requests that required follow up actions were being closed with no further updates being provided, causing difficulties for Councillors when relaying closure information to their constituents. Further questions were therefore added to the Elected Member closure form to allow services to record outstanding/follow up actions and when they will be completed by. The number of Councillor requests that had follow up actions recorded in H1 2025 was 29, of which 19 had been marked as complete at the time of writing this report. 3. Proposals 3.1 It is proposed the Committee approves the report and recognises the Council’s performance in handling Elected Member requests in relation to Section 2 above. 4. Implications/Socio-economic Duty Financial 4.1 None. Human Resources 4.2 None. Legal 4.3 None. Equality/Socio-economic 4.4 None. Climate Change and Carbon 4.5 None. 12
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PUBLIC INFORMATION PUBLIC INFORMATION Key Priorities 4.6 None. Community Wealth Building 4.7 None. Islands Communities Impact Assessment (ICIA) 4.8 None. United Nations Rights of the Child (UNCRC) 4.9 None. Consumer Duty 4.10 None. 5. Consultation 5.1 None. Aileen Craig Head of Service for Democratic Services For further information please contact Aileen Craig, Head of Democratic Services, on (01294) 324125. Background Papers None 13
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NORTH AYRSHIRE COUNCIL 12 March 2026 Audit and Scrutiny Title: Code of Corporate Governance Statement 2026-27 Purpose: To seek approval of Code of Corporate Governance Statement for the Financial Year 2026/27 Recommendation: That the Audit and Scrutiny Committee agrees to: (a) Review and approve the Code of Corporate Governance Statement 2026/27 1. Executive Summary 1.1 This report provides details of how we ensure good governance, including clear accountability for delivering the desired outcomes for service users and communities. Appendix 1 provides our Code of Corporate Governance Statement 2026/27. 2. Background 2.1 All local authorities have a statutory requirement to report publicly on the extent to which they comply with their own Code of Governance on an annual basis, including how they have monitored and evaluated the effectiveness of their governance arrangements in the year and considered planned changes in the coming period. 2.2 The ‘Delivering Good Governance in Local Government Framework’ (CIPFA/Solace 2016) applies to annual governance statements. It helps local government take responsibility for developing and shaping an informed approach to governance and aims to achieve the highest standards in a measured and proportionate way. The Framework is intended to assist authorities individually in reviewing and accounting for their own unique approach. 2.3 The overall aim is to ensure that: • Resources are directed in accordance with agreed policy and according to priorities. • There is sound and inclusive decision making. • There is clear accountability for the use of those resources in order to achieve desired outcomes for service users and communities. 2.4 Appendix 1 contains our Code of Corporate Governance Statement 2026/27 which aligns to the Framework and demonstrates how we are ensuring good governance and transparent accountability. Agenda Item 4 15
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3. Proposals 3.1 The Audit and Scrutiny Committee is requested to (a) Review and approve the Code of Corporate Governance Statement 2026/27. 4. Implications/Socio-economic Duty Financial 4.1 None. Human Resources 4.2 None. Legal 4.3 None. Equality/Socio-economic 4.4 None. Climate Change and Carbon 4.5 None. Key Priorities 4.6 Effective governance is key to delivering our priorities outlined within our Council Plan 2023-28, specifically the Sustainable Council priority. Community Wealth Building 4.7 None. Islands Communities Impact Assessment (ICIA) 4.8 None. United Nations Rights of the Child (UNCRC) 4.9 None. Consumer Duty 4.10 None. 16
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5. Consultation 5.1 The Executive Leadership Team were involved in the creation of the Code of Corporate Governance. Aileen Craig Head of Service (Democratic) For further information please contact Isla Cruickshanks, Senior Manager (Policy, Performance and Democracy) on 01294 324035. Background Papers None 17
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Code of Corporate Governance 2026 to 2027 18
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Delivering Good Governance in Local Government 2026 to 2027 This document details how North Ayrshire Council complies with the Delivering Good Governance in Local Government: Framework (CIPFA/Solace, 2016). The Framework supports local government to take responsibility for developing and shaping an informed approach to governance, aimed at achieving the highest standards in a measured and proportionate way. It assists authorities individually in reviewing and accounting for their own unique approach. The overall aims ensure: • Resources are directed in accordance with agreed policy and according to priorities. • There is sound and inclusive decision making. • There is clear accountability for the use of those resources in order to achieve desired outcomes for our service users and communities. The Framework applies to annual governance statements prepared for the financial year 2016/17 onwards. For further information please contact: The Corporate Policy and Performance Team North Ayrshire Council Tel: 01294 310000 Email: NorthAyrshirePerforms@north-ayrshire.gov.uk Code of Corporate Governance 2026 to 2027 Page 1 of 14 19
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Code of Corporate Governance 2026 to 2027 Page 3 of 15 Demonstrating strong commitment to ethical values • New Elected Members are provided with a full Induction Programme which includes all aspects of conduct. There is an extensive programme of inductions at the outset of the new Council Administration. Thereafter, sessions are provided on a regular basis. • All Elected Members have access to Continuing Professional Development discussions and the opportunity to participate in self/360 assessments to review and support their ongoing development. In addition to this, a series of development events is provided to further support Elected Members’ Development. A calendar of events on a variety of topics is arranged and promoted to Elected Members. Online guides and e-learning are also available. • All employees including Chief Officers participate in ‘Our Time to Talk’ discussions which provide the opportunity to discuss the focus of work, how this will be done (behaviours linked to our Staff Values) and what development is required to support this. This is an annual discussion which can be supported throughout the year by one-to-one discussions and a mid-year review as required. • The Council invests in leadership and management development by hosting a Leadership Academy. This provides aspiring, first, middle and strategic leaders, including Chief Officers and Elected Members, with a variety of development interventions which enhance, refresh and develop their skills, knowledge and behaviour. • There is a Code of Conduct for Employees. • The Code of Conduct for Councillors sets out the minimum standards of conduct that are expected from Elected Members and provides advice and guidance on registerable interests and on the declaration of interests. The Code also sets out the sanctions that can be applied by the Standards Commission where a breach of the Code occurs. Elected Members are provided with quarterly updates from the Standards Commission and Advice Notes issued by the Commission to assist in compliance with the Code of Conduct are communicated. • The Ethical Standards in Public Life etc. (Scotland) Act 2000 and the Code of Conduct for Councillors require the interests of Members to be declared set out the categories of interests, financial or otherwise, that Councillors of Scottish local authorities must register. This register is available for inspection by members of the public. In compliance with the Act and relevant Regulations, the 33 Elected Members of North Ayrshire Council have registered interests with the Proper Officer of the Council. The Register of Interests and notifications of Declarations of Interest are available for inspection. Reports on Elected Member Training are submitted to the Executive Leadership Team (ELT) and to the Audit and Scrutiny Committee on an annual basis. • The Council has approved Guidelines for Member/Officer Relations (incorporating the Protocol on Member/Officer Relations from the Councillors’ Code of Conduct). This is subject to annual review as part of the Council’s review of governance documents. • Declarations of Interest is a set item on all Council and Committee Meeting Agendas. There is a requirement for all Elected Members to declare any financial or non-financial interests in accordance with the Code of Conduct. • There is a Whistle Blowing policy in place for employees, which was reviewed in 2020 with a minor accuracy update in 2023. In line with accessibility requirements, this was reviewed in 2022 and again in 2025. A. Behaving with integrity, demonstrating strong commitment to ethical values and respecting the rule of law 20
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Code of Corporate Governance 2026 to 2027 Page 4 of 15 • A Media Protocol is in place. • The People Strategy, “Our People Connect”, was designed by our employees for our employees. This outlines priorities that will engage and support the transformation of the Council to be a leaner, more efficient and higher performing organisation where people can develop and thrive. • Our Staff Values of Focus, Passion and Inspiration are key to our People Strategy “Our People Connect”. They are now fully embedded in everything we do each day and visible when logging onto a laptop or desktop, poster or wall displays, lanyards etc. In addition to this they are embedded in our recruitment process, onboarding process and throughout our development interventions (such as courses and “Our Time To Talk” discussions). Respecting the rule of law • Strategic decision-making is governed by the Council’s key constitutional documents which are subject to regular review. The governance documents were approved by Council in May 2022 and reviewed in May 2023, September and December 2024 and September 2025. The key documents are the Scheme of Administration, The Standing Orders for Meetings and Proceedings of the Council, the Standing Orders relating to Contracts and Contract Procedure Rules and the Scheme of Delegation to Officers. • The Council’s Cabinet is the key strategic decision-making committee, comprising the Leader of the Council, the Depute Leader and four Members of the Administration. • The roles and responsibilities of the Council’s Audit and Scrutiny and Appeals Committees are set out in the approved Scheme of Administration. • The Head of Service (Finance) is appointed as the Section 95 Officer and is responsible to the authority for the proper administration of financial affairs as stated within the Local Government (Scotland) Act 1973. • The Head of Service (Democratic Services) is appointed as the Monitoring Officer. • The Head of Service (Democratic Services) is appointed as RIPSA Senior Responsible Officer (SRO). The SRO ensures compliance with the terms of The Regulation of Investigatory Powers (Scotland) Act 2000 (RIPSA) and associated legislation. • The Chief Social Work Officer is appointed in accordance with Section 3 of the Social Work (Scotland) Act 1968. • The Council has appointed a Chief Planning Officer. • The Head of Service (Education) is appointed as Chief Education Officer in anticipation of the commencement of Section 25 of the Education (Scotland) Act 2016. • The Revised Remuneration Policy Guidance is in place. • The Counter Fraud and Corruption Strategy is in place. • A Data Protection Officer (DPO) is appointed. The DPO ensures compliance with the General Data Protection Regulation (2018) and the Data Protection Act (2018) legislation. 21
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Code of Corporate Governance 2026 to 2027 Page 5 of 15 B. Ensuring openness and comprehensive stakeholder engagement Openness • Our Council Plan 2023 to 2028 was approved by Council on 21st June 2023 and sets out our strategic approach to making North Ayrshire a fairer and more equal society. This sets out our vision, mission and four priorities up to 2028. • We have 26 Council Plan Performance Indicators to ensure that progress on the Council Plan is managed and scrutinised. Targets have been set where appropriate for each of the indicators to ensure we can monitor progress of our priorities. Progress on the Council Plan is also scrutinised through the half yearly Council Plan Progress Reports sent to the ELT, Cabinet and the Audit and Scrutiny Committee. These are published on the performance pages of our website. In addition, summary reports are scrutinised by the ELT at Quarter 1 and Quarter 3. • Council Plan actions are high-level five-year actions as listed within the Council Plan 2023 to 2028 and are supported by relevant strategies. How to determine the status of an action is detailed within our Performance Management Strategy 2023-28 (October 2025 Refresh). • The Council’s Annual Performance Report provides a summary of our performance during the year and is available on our website. • Financial information including annual accounts is published on our website. • Our Annual Governance Statement is approved annually by the Audit and Scrutiny Committee and published on our website. • Our Performance Management Strategy 2023 to 2028 (October 2025 Refresh) aligns to our Council Plan and is published on our website. It details legislative requirements, current procedures and planned activities to drive continuous improvement for the people of North Ayrshire. • Links to My Local Council website are published which provide our residents with Local Government Benchmarking Framework (LGBF) performance information and comparisons to other local authorities. Information on our performance within the LGBF is integrated within our suite of public performance reporting as part of our six-monthly Council Plan Mid-Year and Year-End Progress Reports. • There is a presumption that all committee business is open to the public except where required by law to be in private. Council/Committee meetings which are open to the public are also live streamed to the internet and/or available to view as a recording following the meeting. Since 2020 both Council and Committee meetings have been streamed live with recordings available for viewing thereafter. The Council meeting in September 2022 agreed that “hybrid meetings” should be the default position for meetings whereby some Members attend the meeting in person and others may join remotely. This improves accessibility and participation. A hybrid meetings protocol is in place and subject to regular review. • Through our commitment to the Community Empowerment (Scotland) Act 2015, the Council’s Community Planning website has been developed to share information and research about the work of the Community Planning Partnership, Locality Planning, our key aims and objectives and align with the requirements of the Act. • The Council has separate schemes for reporting complaints and compliments, as well as customer feedback for the Health and Social Care Partnership. • Two complaint reports are submitted to the Audit and Scrutiny Committee each year and trends or issues fed back to services to identify improvements. The Council has a dedicated Complaints 22
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Code of Corporate Governance 2026 to 2027 Page 6 of 15 Manager who supports Chief Officers, Senior Managers, Elected Members as well as complaint handlers and acts as liaison with the Scottish Public Services Ombudsman. • All inspection reports are reviewed by Cabinet and the Audit and Scrutiny Committee. • The Council’s Publication Scheme and guidance on submitting Freedom of Information and Environmental Information requests are available on the Council’s website. • Guidance on submitting Subject Access Requests is available on the Council’s website. • Open Data is published on the Council’s Open Data Portal, enabling members of the public to access information on various council services such as Education, Environment, Culture and Leisure, Planning and Building Standards, and Roads and Transport. • Elected Members have access to data on Pentana on request allowing them to view progress of the Council Plan indicators. Engaging comprehensively with institutional stakeholders • The Council is committed to engaging in a meaningful way with its communities so that it can understand and respond effectively to local needs and is committed to the principles of the National Standards on Community Engagement. • The Community Planning Partnership hosts the Council’s Participation Strategy, developed jointly with partners, and showcasing the range of opportunities for communities to engage in various mechanisms to support Council decision making. • The Council is committed to supporting the establishment and work of Community Councils and their role in Locality Partnerships as well as supporting Locality Planning in its own right as the Council’s scheme of decentralisation. The Scheme of Establishment for Community Councils is currently under review following consultation with our communities and is due to be finalised in 2026 to 2027. • The Community Planning Partnership website contains The Engagement Hub and a consultation calendar which brings all partner consultations together in a searchable format and gives feedback on consultations. • The Community Engagement Network of the Community Planning Partnership has been refocused and aims to ensure partners meet the revised National Standards for Community Engagement. • The North Ayrshire Health and Social Care Partnership Integration Joint Board (IJB) is the governing body of the North Ayrshire Health and Social Care Partnership. It has delegated responsibilities from North Ayrshire Council and NHS Ayrshire and Arran. Engaging with individual citizens and service users effectively • Engagement and consultation are at the heart of the Community Planning Partnership and is driven through training, digital resources, and links to key strategies and approaches. For example, the Youth Participation and Citizenship Strategy, Older People’s Forum and Community Engagement Network are all key examples of this work. There is now an online ‘Engagement Hub’ on the Community Planning website, comprising of an online engagement list, events calendar, community and partner resources, and information about the CPP’s Participation Approach. • The Council routinely engages with our residents on our services and proposals. The Council recently undertook a large budget consultation exercise which elicited 1,225 responses to help inform 23
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Code of Corporate Governance 2026 to 2027 Page 7 of 15 budget setting proposals. The views of our communities including our young people are also gathered through consultation with a range of groups such as Parent Councils, Youth Forums, Tenants Associations, Community Associations and networks and the Access Panel. • The ongoing development of Locality Partnerships has made Community Planning more accessible to local people. • Increased use of social media through Locality Facebook pages, the Community Planning Partnership X account and partner use of Community Planning hashtag supports communication with a wider audience. • Participatory Budgeting is an approach to deepening engagement with residents which delivers real influence for individuals and communities and the Council has made significant commitment and investment in this work. • The North Ayrshire Community and Locality Planning Model extends and deepens engagement with individuals and participation by communities by: Co-defining the issues; co-producing the responses; and co-delivering the solutions. • We currently use the Consul application to run Shaping North Ayrshire, our online participation forum enabling residents to provide feedback on current topics. • Application of the Place Standard enables individuals and communities to express how it feels to live in local communities and to shape the development of community and spatial planning in their area. 24
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Code of Corporate Governance 2026 to 2027 Page 8 of 15 Defining outcomes • The Council’s vision and mission outlined in Our Council Plan 2023-28 links strongly to the North Ayrshire Community Planning Partnership’s (CPP’s) shared vision of ‘North Ayrshire – A Better Life’. • Our Council Plan 2023 to 2028 was approved by Council in June 2023. Our vision and mission in Our Council Plan are: o Vision: ‘A North Ayrshire that is fair for all’ o Mission: ‘Working together to improve the lives of our people in North Ayrshire’ • Our Council Plan has four interlinked and interdependent priorities: o Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people. o Communities and Local Democracy – we will have active, inclusive and resilient communities. o Climate Change – to achieve net zero by 2030. o A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities. • The role of the Audit and Scrutiny Committee and ELT/ Chief Officers Leadership Team is to scrutinise the findings from the various performance reports. We regularly report on the following to ensure effective scrutiny: o Locality Outcome Improvement Plan (LOIP) Progress Reports. o Locality Partnership progress reports. o Council Plan Progress Reports - six monthly reports to Cabinet and the Audit and Scrutiny Committee; quarterly reporting to the ELT. o Council Plan Annual Performance Report. o Local Government Benchmarking Framework. • As part of the recent self-evaluation work undertaken by the Audit and Scrutiny Committee, a standing agenda item to cover areas which the Committee would like to have addressed has been added to the committee agendas. • We utilise the Pentana online performance management system to track and manage Council priorities and measures. • The Council Plan Performance Management Framework (performance indicators and strategies mapped to actions) is reviewed regularly. The Council Plan actions are as published within the Council Plan 2023 to 2028 and are high level actions over five years. They are supported by strategies within the Council. • Operational Plans are prepared and reviewed on an annual basis. • Strategic risks and control factors are reported to Cabinet. C. Defining outcomes in terms of sustainable economic, social, and environmental benefits 25
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Code of Corporate Governance 2026 to 2027 Page 9 of 15 Sustainable economic, social and environmental benefits • Our Local Outcomes Improvement Plan’s clear focus has been agreed by Community Planning partners across themes of Wellbeing, Work and World with an overarching focus on reducing inequalities and working in partnership. • Our Council Plan priorities ‘Wellbeing’ and ‘Climate Change’ link to a range of actions supporting a wellbeing economy, as well as performance indicators such as carbon emissions and amount of energy generated from low carbon sources. • The Climate Change Steering Group is established to drive activity in delivering the Climate Change Council Plan priority. Comprising senior management representatives from each Council Directorate, Community Planning Partners, private sector and other agencies, meetings take place every four months. • The Community Wealth Building Strategy was refreshed for 2024 to 2027 and is available on our website. Community Wealth Building is central to our Council Plan 2023 to 2028. • The Ayrshire Regional Economic Strategy sets out the region’s 10-year vision for the economy and progress is reported through the Ayrshire Economic Partnership Board and Joint Committee. • The Sustainable North Ayrshire Strategy 2024 to 2027 is established. • The North Ayrshire Nature Network Strategy is in place, as is the Local Biodiversity Action Plan (2019 to 2031). • Our Economic Development, Growth and Regeneration priorities are identified and delivered through a range of strategies including the Ayrshire Regional Economic Strategy, our Regeneration Delivery Plan 2021 to 2026, Vacant and Derelict Land Strategy 2023 to 2027 and Local Transport and Active Travel Strategy 2023 to 2028. • The Annual Climate Change Reporting Duty is submitted to Scottish Government. • Our Children’s Services Planning includes our Children’s Rights Report and our Child Poverty Action Plan 2023 to 2026. Our Children’s Services Plan outlines our aims and priorities to safeguard, support and promote the well-being of children and to make North Ayrshire the best place in Scotland to grow up. Our Children’s Rights Report emphasises our commitment to promote and protect children and young people’s rights in line with the UN Convention on the Rights of the Child (UNCRC). Our Child Poverty Action Plan takes account of the actions we are taking with partners to address child poverty in North Ayrshire. Progress is reported to the Community Planning Partnership Board. • Our Education Service Improvement Plan 2023 to 2026 aims to improve the educational outcomes for all learners, particularly those who are most disadvantaged. • Our committee report template includes a requirement to evaluate equality, socio-economic, island and climate change impacts to ensure these are embedded within our decision-making processes. • The Council is committed to using the Local Government Benchmarking Framework (LGBF) Performance Indicators to scrutinise performance on our priorities against all local authorities within Scotland. • The Housing and Public Protection Service complies with the Scottish Regulators Strategic Code of Practice. The integrated regulatory functions within the service (Building Standards, Environmental Health and Trading Standards) can demonstrate an effective contribution towards the Council’s approach to sustainable economic growth as well as maintaining and promoting a prosperous, fair and safe society. 26
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Code of Corporate Governance 2026 to 2027 Page 10 of 15 Determining interventions • The information submitted to Committees is discussed in detail at ELT to ensure management oversight and thereafter at pre-Agenda meetings (except in the case of regulatory committees) that are held one week prior to the formal meetings. This enables any additional information to be sought to allow a fully informed decision to be taken at the Committee. • Each report should indicate the justification for each action proposed and consultations undertaken in its development, together with feedback from consultees. Reports also contain separate sections on a range of implications (financial, human resources, legal, socio-economic duty including the consumer duty and island impacts, equality including children and young people’s rights, Community Wealth Building and the Council’s key priorities). Guidance for report authors provides information on the completion of these elements within the required fields in a committee report. Planning interventions • Council Plan six monthly progress reports. • Operational Plan reports to Heads of Service and Executive Directors. • Use of Pentana online performance management system allows us to ensure we are achieving acceptable levels of performance, identify opportunities for continuous improvement and ensure we have plans in place to improve underperforming areas. • Council and Operational Plan performance reports produced from Pentana contain trend information on performance indicators. • Strategic risks and control factors are reported to Cabinet. • The Risk Management Strategy is in place and available on our website. • The Community Planning Partnership Risk Register has been reviewed to reflect the refreshed Local Outcomes Improvement Plan 2022 to 2030. • The Workforce Strategy (2024 to 2028) has been refreshed in 2024, this explains how our workforce will support the delivery of the Council’s ambitions within the available financial resources and builds on the workforce planning approach carried out at a service level. Power BI is used to manage performance across our workforce. • ‘Our approach to Workforce planning’ HR guide is published on our intranet to support managers and Heads of Service in shaping their current and future workforce to ensure delivery of efficient and effective services and is a significant factor in how we transform our Council to deliver our financial challenges. In order to be successful, it is key for workforce planning to flow from the Council Plan and link to people management, financial management and operational processes. • Long Term Financial Outlook – The Council’s Long-Term Financial Outlook outlines the financial challenges facing the Council over the next 10 years and is reported to Cabinet. • Medium Term Financial Plan – The Council’s Medium-Term Financial Plan provides an overview of the Council’s anticipated financial position for the next three financial years. This is approved by Council annually. A copy of the budget book is published on our website each year. D. Determining the interventions necessary to optimise the achievement of the intended outcomes 27
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Code of Corporate Governance 2026 to 2027 Page 11 of 15 • Capital Investment Programme – The Council’s Capital Investment programme provides an overview of the capital projects the Council is investing in over the 10-year period and associated funding sources. The 10-year Capital Investment Programme is reviewed and approved by Council annually. • Capital Investment Strategy – The Council’s Capital Investment Strategy provides an overview of how capital investment plans, financing and treasury management activity contribute to the infrastructure and provision of services for the benefit of North Ayrshire communities and citizens. • The Council has an overarching Asset Management Strategy which brings together the individual asset category plans (Property, Housing, Roads, Fleet, ICT and Open Space), providing a consistent and coherent structure of asset management. Optimising achievement of intended outcomes • Regular reporting of financial performance to Cabinet. • Production of annual accounts and publication on our website. • Local Financial Returns. 28
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Code of Corporate Governance 2026 to 2027 Page 12 of 15 Developing the entity’s capacity • The Leadership Academy provides skills, knowledge and behavioural development for leaders at all levels. Managers regardless of grade can, if committed to their continuous learning and supported by their manager, progress through the levels of the Leadership Academy from First to Strategic utilising development opportunities and accessing tailored interventions for career progression. This provides an opportunity to build leadership capacity and grow our own talent. • The Connected Leadership Network is an active Teams channel which provides an opportunity for Senior Managers to gain support from others as well as sharing knowledge, ideas and suggestions. This has been a successful addition to the Leadership Academy and supports the digital agenda. • The Chief Officer Leadership Team (COLT) meet on a quarterly basis to provide an opportunity to collaborate on key priorities aligned to the Council Plan. • The Chief Executive hosts a Connected Leadership Conference three times per year. This provides an opportunity for sharing of information and increased engagement and collaboration opportunities with other managers to deliver our Council Plan priorities. Themes are then continued through Chief Officer Leadership Team sessions and Connected Leadership information sessions to enrich the knowledge gained and give further opportunities to work together and drive improvements. Developing the capability of the entity’s leadership and other individuals • Each employee has a Role Profile which provides information on the expectations of the job. This supports the development of skills, knowledge and behaviours of our employees. • All governance documents including the Scheme of Delegation to Officers and the Financial Regulations documents are reviewed annually and published on our website. • All employees throughout the Council participate in “Our Time To Talk” discussions which provide the opportunity to discuss the focus of work. It ensures managers and employees take time, at least once per year, to reflect and most importantly ’TALK’ about how the employee is getting on at work. This is an annual discussion which can be supported throughout the year by one-to-one discussions and a mid-year review as required. • New Elected Members are provided with a full induction programme which includes all aspects of Council business, such as overview of Council meetings, introduction to the ELT and the role of the councillor. • A series of development events are provided to further support Elected Members’ Development. A calendar of events on a variety of topics is arranged and promoted to Elected Members, in addition to online guides and e-learning. • Elected Members are invited to participate in an annual development discussion in addition to an opportunity to participate in self/360 assessment. This allows identification of development activity to support their role and provides feedback on their individual performance utilising the 360 tool. • The Community Planning Partnership’s Community Learning and Development Plan contains leadership development. E. Developing the entity’s capacity, including the capability of its leadership and the individuals within it 29
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Code of Corporate Governance 2026 to 2027 Page 13 of 15 Managing risk • The Council’s approach to Risk Management is outlined within its Risk Management Policy and Strategy • The Strategic Risk Register is refreshed annually, approved by Cabinet and subject to a six-month progress update. A Corporate Risk Register is refreshed annually, approved by the ELT and also subject to a six-month progress update. Operational Risk Registers are updated by services six-monthly. There are escalation and de-escalation processes in place between the registers. • The Corporate Risk Management Group, with senior representation from all Directorates, meets six- monthly to review and update risks and their associated risk management action plans. Other related business will also be considered where this could enhance the organisational risk posture. • The Community Planning Partnership Risk Register was revised in 2022 to align with the Local Outcomes Improvement Plan 2022-30. Managing performance • Council Plan Progress Reports are scrutinised by the ELT, Cabinet and the Audit and Scrutiny Committee. The reports are produced in a ‘magazine style’ format to make the information as engaging and accessible as possible. • Performance indicators (including targets where appropriate) and actions are included within the Council Plan Performance Framework and Council Plan. All updates to the framework are detailed within the six-monthly Progress Reports and reported to ELT, Cabinet and Audit and Scrutiny for full transparency. • The six-monthly Council Plan Progress Reports focus on outcomes as well as ongoing activity and outputs. Case studies alongside information on audits, inspections and accreditations are included to show how we are performing. Benchmarking activity takes place via the Local Government Benchmarking Framework (LGBF) indicators included in the Performance Management Framework and those that link directly to our priorities (“LGBF priority indicators”) are scrutinised quarterly by ELT and through our six-monthly reporting for Cabinet and the Audit and Scrutiny Committee. This ensures we learn from others and continually improve. Links are provided within the reports to additional information where appropriate. This holistic approach provides a well-rounded view of performance within our Council that includes valuable context to enable effective scrutiny. • The six-monthly Council Plan Progress Reports (Quarters 2 and 4), which include LGBF comparisons as well as the Annual Performance Report, are published on our website. Scrutiny is invited from residents and contact information is contained in the reports. • Operational Plans within services align directly to the Council Plan and are scrutinised by relevant Senior Managers and Heads of Service. F. Managing risks and performance through robust internal control and strong public financial management 30
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Code of Corporate Governance 2026 to 2027 Page 14 of 15 • Benchmarking activity is undertaken based on the Local Government Benchmarking Framework (LGBF) as well as through specific groups. In addition to quantitative comparisons, outcome-based benchmarking also takes place. • Our Performance Management Strategy 2023-28 (October 2025 Refresh) is published on our website and aligns to Our Council Plan 2023-28. Robust internal control • The Council has a framework of Internal Controls embedded within services, underpinned by Financial Regulations and Codes of Financial Practice which are approved by the Council. • Internal Audit establishes an annual risk-based plan of work to review controls across the Council. This is approved by the Audit and Scrutiny Committee and is subject to a mid-year review process. • All audit findings are reported to the Council’s Audit and Scrutiny Committee. • The Council has a Corporate Fraud Team which investigates all allegations of fraud and error against the Council. Six-monthly update reports are provided to the Audit and Scrutiny Committee. Regular review of the Counter Fraud and Corruption Strategy is undertaken. • An annual report and assurance statement is provided by the Chief Internal Auditor to the Audit and Scrutiny Committee. • An annual report on RIPSA is provided to ELT and Cabinet and we provide an annual statistical return on use of investigatory powers to the Investigatory Powers Commissioner’s Office (IPCO). • A governance structure was implemented by the three Ayrshire Councils in 2018 to oversee the delivery of the Ayrshire Growth Deal (AGD) and promote the objectives of the Ayrshire Regional Economic Partnership. This comprises the Ayrshire Growth Deal Project Management Office (PMO) which reports directly to the Chief Executives Group, Ayrshire Economic Partnership Board and Joint Committee, with the Ayrshire Economic Partnership Board sitting below the Joint Committee and having responsibility for the day-to-day business of the partnership and AGD. During 2026/27 the remit of the Ayrshire Regional Economic Joint Committee will be extended to reflect the transformational approach to shared services in Economic Development between North and East Ayrshire Councils. The relevant governance arrangements and documentation will be updated at the appropriate time, approval for the new approach having been granted by Council in February 2026. Managing data • The Council’s Records Management Plan (RMP) was approved by the Keeper of the Records of Scotland in 2015. As defined by the Public Records (Scotland) Act 2011, the Council undertake Progress Update Reviews and submit to the Keeper to monitor compliance. • The Council maintains an Information Asset Register (IAR) which is kept under regular review. • The Council has a process for undertaking Data Protection Impact Assessments (DPIA) with approval required from DPO and annual reviews embedded to ensure compliance with Article 35 of the UK GDPR. 31
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Code of Corporate Governance 2026 to 2027 Page 15 of 15 Implementing good practice in transparency • We publish our public facing reports on our website. • Committee Reports and webcast recordings are on our website. • There is a presumption that all committee business is open to public except where required by law to be in private. • We publish open datasets. Implementing good practices in reporting • Annual Governance Statement. • Six monthly Council Plan Progress reports and Annual Performance Reports produced, with updates to accompanying Performance Management Framework reported in detail to the ELT, Cabinet and the Audit and Scrutiny Committee. • Community Planning Partnership Annual Performance Report. • Health and Social Care Partnership Annual Performance Report. • Annual Accounts demonstrates best practice according to external auditors. Assurance and effective accountability • The Annual Governance Statement is approved by the Audit and Scrutiny Committee prior to inclusion within the annual accounts. • Any recommendations by External Audit are reported to the Audit and Scrutiny Committee and progress with implementation is monitored by Internal Audit and also reported to the Committee on a bi-annual basis. • Internal Audit work is reported to the Audit and Scrutiny Committee on a quarterly basis. • The Council’s Internal Audit Team received an independent External Quality Assessment in July 2022 which demonstrates conformance with the Public Sector Internal Audit Standards. This needs to be carried out at least every five years, with periodic self-assessments also carried out by the Chief Internal Auditor. • The Chief Auditor has rights of access to the Chief Executive and the Chair of the Audit and Scrutiny Committee in relation to any audit matter. • The Data Protection Officer has direct rights of access to the Chief Executive and Chief Officers in relation to any personal/sensitive data protection matters. G. Implementing good practices in transparency, reporting and audit to deliver effective accountability 32
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PUBLIC INFORMATION NORTH AYRSHIRE COUNCIL 12 March 2026 Audit and Scrutiny Committee Title: Internal Audit Plan 2025/26: Progress Update Purpose: To provide an update on progress made in delivering the 2025/26 Internal Audit Plan. Recommendation: That the Committee notes the current position with the 2025/26 internal audit plan 1. Executive Summary 1.1 The current Internal Audit Plan for 2025/26 was approved by the Audit and Scrutiny Committee in March 2025 and updated in November 2025. The plan sets out the areas of work which Internal Audit intends to cover during the year. 1.2 The Global Internal Audit Standards (GIAS) recognise that the internal audit plan should be dynamic and updated in response to changes in the organisation’s business, risks and control environment. Accordingly, the Chief Audit Executive (Senior Manager) is required to review and revise the internal audit plan as necessary and to report such changes to the Committee. 1.3 Progress against the approved 2025/26 Internal Audit Plan is summarised in Appendix A. At the time of reporting, a number of audits have been completed and reported, with several further audits either at review stage or with fieldwork ongoing. It is anticipated that the majority of in-year audit work will be completed in sufficient time to inform the annual internal audit opinion for 2025/26. 1.4 A small number of audits included within the 2025/26 plan will not commence by March 2026. These audits have been discussed with senior management and, where appropriate, are proposed for inclusion within the 2026/27 Internal Audit Plan. 1.5 It is proposed that, from the 2026/27 financial year onwards, Internal Audit progress reports will be presented to the Audit and Scrutiny Committee on a quarterly basis, further enhancing transparency and oversight. Agenda Item 5 33
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PUBLIC INFORMATION 2. Background 2.1 In line with the Standards, the audit plan should be reviewed and revised as necessary. 2.2 The Audit and Scrutiny Committee has responsibility for overseeing the effectiveness of Internal Audit, including monitoring delivery of the approved Internal Audit Plan. Periodic progress reporting enables the Committee to obtain assurance on the extent to which planned audit work is being delivered and to understand any material changes to the plan. It is planned that regular progress reports such as this will be brought to committee on a quarterly basis, outlining not just any proposed changes to the Plan but provide a summary of the current status of audits. 2.3 Appendix A to this report summarises progress against the approved 2025/26 Internal Audit Plan and provides an overview of the current status of each audit assignment, including those proposed to roll forward into the 2026/27 plan. 3. Proposals 3.1 It is proposed that the Committee notes the current position with the 2025/26 internal audit plan, as specified in Appendix A. 4. Implications/Socio-economic Duty Financial 4.1 None. Human Resources 4.2 None. Legal 4.3 None. Equality/Socio-economic 4.4 None. Climate Change and Carbon 4.5 None. Key Priorities 4.6 The work of Internal Audit helps to support the efficient delivery of the strategic priorities within the Council Plan 2023-2028 Community Wealth Building 4.7 None. 34
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PUBLIC INFORMATION Islands Communities Impact Assessment (ICIA) 4.8 None. United Nations Rights of the Child (UNCRC) 4.9 None. Consumer Duty 4.10 None. 5. Consultation 5.1 The relevant Services are consulted on Internal Audit findings during each audit assignment. Services have also been consulted on the proposed changes to the internal audit plan. Mark Boyd Head of Service (Finance) For further information please contact Paul Brown, Senior Manager (Audit, Fraud, Safety, Risk and Insurance, on paulbrown1@north-ayrshire.gov.uk Background Papers None. 35
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Appendix A PUBLIC INFORMATION Audit Assignment Title Planned Quarter Current Progress HSCP – Overtime Controls Q1 Audit Complete & Reported Council Tax/NDR Refunds Q1 Audit Complete & Reported School Funds Q1 Audit Complete & Reported ICT – Asset Management Q1 Fieldwork Ongoing Buildings & Estate Management Q1 Fieldwork complete. At review stage. Social Care Establishments Q2 Fieldwork Ongoing Capital Monitoring Q2 Fieldwork complete. At review stage. Accounts Payables Transactions Q2 Audit Complete & Reported ELC Payments to Partner Nurseries Q2 Fieldwork Ongoing Absence Management Q2 Within 2026/27 Plan Tenants & Residents Associations Ongoing Audit Complete Grants Compliance Q4 Within 2026/27 Plan School Inventory Management Q4 Within 2026/27 Plan HSCP – Business Continuity Management Q4 Within 2026/27 Plan Payroll Transactional Testing Q3 Fieldwork complete. At review stage. Neighbourhood Services – Overtime Q4 Within 2026/27 Plan Ayrshire Growth Deal Q4 To Start IJB Financial Sustainability Q3 To Start ICT Incident Detection Q4 Within 2026/27 Plan 36
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1 OFFICIAL INFORMATION OFFICIAL INFORMATION NORTH AYRSHIRE COUNCIL 12 March 2026 Audit and Scrutiny Committee Title: Internal Audit and Corporate Fraud Action Plans: Quarter 3 Update Purpose: To advise the Audit and Scrutiny Committee on the progress made by Council Services in implementing the agreed actions from Internal Audit and Corporate Fraud reports as at 31 December 2025. Recommendation: That the Committee notes the current position with the implementation of Internal Audit and Corporate Fraud actions. 1. Executive Summary 1.1 The CIPFA document 'Audit Committee Principles in Local Authorities in Scotland' highlights that Audit Committees should monitor and review the progress made in implementing audit recommendations. 1.2 Service managers are responsible for ensuring that agreed actions arising from Internal Audit and Corporate Fraud reviews are implemented. This provides assurance that identified control weaknesses have been addressed and are being managed effectively. 1.3 All actions are monitored on the Pentana system and service managers are responsible for updating Pentana as they progress each action. This enables Internal Audit to monitor progress on a 'real-time' basis and address any delays in implementation. 1.4 This report details the position as at 31 December 2025. 2. Background 2.1 The last report to the Audit and Scrutiny Committee on 20 November 2025 highlighted that there were 7 actions outstanding at the end of September 2025, with 4 having not passed their due date. 2.2 In addition to these 7 carried forward actions, there have been 11 new actions agreed, giving a total of 18 action points for review. Agenda Item 6 37
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2 OFFICIAL INFORMATION OFFICIAL INFORMATION 2.3 Services have completed 13 actions since the last report. All Council Services are required to retain evidence of work carried out in completing their actions and Internal Audit carries out 'spot-checks' on a sample of completed actions on an ongoing basis. 2.4 Of the remaining 5 actions, 2 were only partially completed as at 31 December 2025 and the remaining 3 actions were not due for completion until after that date. 2.5 Appendix 1 to this report provides the Committee with full details of the 2 actions that were not completed within the agreed timescales. 3. Proposals 3.1 It is proposed that the Committee (a) notes the current position with the implementation of Internal Audit and Corporate Fraud actions; and (b) challenges those Services that have not implemented actions within the previously agreed timescales. 4. Implications/Socio-economic Duty Financial 4.1 None. Human Resources 4.2 None. Legal 4.3 None. Equality/Socio-economic 4.4 None. Climate Change and Carbon 4.5 None. Key Priorities 4.6 The effective implementation of agreed Internal Audit and Corporate Fraud actions helps to support the efficient delivery of the strategic priorities within the Council Plan 2023-2028. Community Wealth Building 4.7 None. 38
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3 OFFICIAL INFORMATION OFFICIAL INFORMATION Islands Communities Impact Assessment (ICIA) 4.8 None. United Nations Rights of the Child (UNCRC) 4.9 None. Consumer Duty 4.10 None. 5. Consultation 5.1 Council Services are consulted during the completion of each Internal Audit and Corporate Fraud review and have also provided updates on progress made in implementing action points. Mark Boyd Head of Service (Finance) For further information please contact Paul Brown, Senior Manager (Audit, Fraud, Safety, Risk and Insurance), on paulbrown1@north-ayrshire.gov.uk. Background Papers None. 39
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4 OFFICIAL INFORMATION OFFICIAL INFORMATION Appendix 1 - Actions due by 31 December 2025 but not started or partially completed Code IA2022PA019b Description Audit Action: A minimum technical standard for CCTV systems should be set for the Council. A Council-wide audit of CCTV inventory should be carried out to assess compliance of CCTV assets against the standards, which will give an indication of the level of capital investment required to bring the Council’s CCTV systems up to an appropriate standard and form the basis of a bid for capital. An approval process should be introduced to ensure new CCTV purchases meet the requirements of the standards. Audit Finding: Audit were advised that there are various capital budgets in place covering vehicles and property lifecycle investment. However, there is no formal replacement programme for CCTV equipment. Risk: Substandard systems that aren’t fit for the intended purpose. CCTV footage is not available or not usable when required. Priority 2 Latest Note Work in relation to the assessment of non-public space CCTV assets continues. A contractor is currently carrying out the surveys which are more than 25% complete. The target date for 100% completion of the surveys is the 28th February. Shortly after this date, a full CCTV asset register will be available for the first time, along with a risk rated prioritisation list for investment in rectification and risk reduction work which will take place thereafter. Some immediate work may be required prior to full completion of the list if deemed necessary due to data or physical risk. DPIAs for CCTV systems across the Council continue to be assessed as and when required and the I-Learn CCTV awareness course continues to be used. Estimated completion date is 31st October 2026. Progress Bar Original Due Date 30-Jun-2022 Due Date 31-Dec-2025 Parent Code & Title IA2022PA019 CCTV in Council Buildings and Vehicles Managed By David Hammond Assigned To David Hammond; Scott McKenzie 40
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5 OFFICIAL INFORMATION OFFICIAL INFORMATION Code IA2025PA012a Description Action Description: Consideration should be given to creating a central ‘library’ of procedures and guidance notes – accessible by all officers with a role in child protection. Finding: There is no central storage location for child protection procedures within HSCP. Risk: Officers are unaware of procedures; officers are using an outdated version of a procedure. Priority 2 Latest Note A SharePoint central repository will be created to store all Child Protection policies and guidance, ensuring easy and consistent access for all HSCP staff. Once established, the Children, Families and Justice Service will upload all relevant information and will continue to update and refresh the site on an ongoing basis to ensure staff have access to the most current documents. Communications will be issued across the HSCP to make staff aware of this new resource. Revised target date 6 May 2026. Progress Bar Original Due Date 22-Dec-2025 Due Date 22-Dec-2025 Parent Code & Title IA2025PA012 Governance of Child Protection Managed By Elizabeth Stewart Assigned To Elizabeth Stewart 41
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NORTH AYRSHIRE COUNCIL 12 March 2026 Audit and Scrutiny Committee Title: External Audit Plan 2025/26 Purpose: To inform the Committee of the External Audit Plan for 2025/26. Recommendation: That Committee notes the External Audit Plan for 2025/26. 1. Executive Summary 1.1 Audit Scotland are the Council’s external auditors for the period 2022/23 to 2027/28, with 2025/26 being the fourth year of this appointment. 1.2 This report provides the Audit and Scrutiny Committee with details of Audit Scotland’s Annual Audit Plan for the 2025/26 audit. 1.3 Following completion of the audit, Audit Scotland will present their annual audit report to the Audit and Scrutiny Committee during September 2026. 2. Background 2.1 Audit Scotland have been appointed as the Council’s external auditors for the period 2022/23 to 2027/28 with 2025/26 being the fourth year of this appointment. In addition, Audit Scotland are the appointed auditors for the North Ayrshire Integration Joint Board for the same period. 2.2 Audit Scotland’s Annual Audit Plan for the 2025/26 audit is attached at Appendix 1. A representative of Audit Scotland will be in attendance to present the plan to the Committee. 2.3 In planning the audit work, Audit Scotland have identified a number of significant risks, as detailed within Exhibit 2 of the Appendix, and these will form the basis of their audit plans for the year. 2.4 The audit will also include consideration of the arrangements for the consolidation of the subsidiaries and associates included within the Council’s Group statements and the Trustees’ Annual Report for the Council’s charitable trusts. 2.5 In addition to the financial statements, the audit will consider the adequacy of the arrangements in place in relation to the wider audit dimensions, including: • Financial Management – consideration of the arrangements to secure sound financial management and budgetary processes; Agenda Item 7 43
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• Financial Sustainability – consideration of the challenges arising from uncertainty over Scottish Government funding and costs pressures linked to pay and inflation over medium and long term planning; • Vision, Leadership and Governance – review of the arrangements in place to deliver the vision, strategy and priorities adopted by the Council; and • Use of Resources to Improve Outcomes – consideration of how the Council uses resources to improve strategic outcomes and deliver continuous improvement. 2.6 Audit Scotland also reports on the Council’s performance in meeting its duties in relation to Best Value. As a result, the Annual Audit Report will include Audit Scotland’s conclusions in relation to the Best Value thematic review of asset management within the Council. 3. Proposals 3.1 That Committee notes the External Audit Plan for 2025/26. 4. Implications/Socio-economic Duty Financial 4.1 The fee which will be charged by Audit Scotland for the 2025/26 audit work will be £401,680. This represents an increase of £16,700 (4.34%) against the 2024/25 fee. An additional £1,100 (2024/25: £1,100) will be charged for the Audit of registered charities. Human Resources 4.2 None. Legal 4.3 None. Equality/Socio-economic 4.4 None. Environmental and Sustainability 4.5 None. Key Priorities 4.6 This report directly supports the Council Plan 2023 to 2028 by maximising financial flexibility to support the delivery of our priorities and focussing our investment on priorities. 44
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Community Wealth Building 4.7 None. Islands Communities Impact Assessment (ICIA) 4.8 None. United Nations Rights of the Child (UNCRC) 4.9 None. Consumer Duty 4.10 None. 5. Consultation 5.1 Audit Scotland consulted with the Head of Service (Finance) in preparing their audit plan. Mark Boyd Head of Service (Finance) For further information please contact Natalie Graham, Team Manager Corporate (Financial Management), on 01294 324533. Background Papers None 45
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North Ayrshire Council Annual Audit Plan 2025/26 Prepared for North Ayrshire Council February 2026 46
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North Ayrshire Council Annual Audit Plan | 2 Contents Introduction 3 Audit scope and responsibilities 4 Audit of the annual accounts 6 Wider scope audit 14 Best Value audit 16 Reporting arrangements, timetable and audit fee 18 Other matters 21 Accessibility You can find out more and read this report using assistive technology on our website www.audit.scot/accessibility. 47
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Introduction | 3 Introduction Purpose of the Annual Audit Plan 1. The purpose of this Annual Audit Plan is to provide an overview of the planned scope and timing of the 2025/26 audit of North Ayrshire Council’s annual accounts. It outlines the audit work planned to meet the audit requirements set out in auditing standards and the Code of Audit Practice, including supplementary guidance. Arrangements for the audit of the Annual Accounts of the eight section 106 Charitable Trusts administered by the Council are detailed in paragraphs 21 to 30. Appointed auditor and independence 2. Fiona Mitchell-Knight, of Audit Scotland, has been appointed by the Accounts Commission as external auditor of North Ayrshire Council, hereafter referred to as ‘the council’, for 2025/26, the fourth of the five-year audit appointment. 3. Fiona Mitchell-Knight and the audit team are independent of the council in accordance with relevant ethical requirements, including the Financial Reporting Council’s Ethical Standard. This standard imposes stringent rules to ensure the independence and objectivity of auditors. Audit Scotland has robust arrangements in place to ensure compliance with ethical standards. The arrangements are overseen by the Executive Director of Innovation and Quality, who serves as Audit Scotland’s Ethics Partner. 4. The Ethical Standard requires auditors to communicate any relationships that may affect the independence and objectivity of the audit team. There are no such relationships pertaining to the audit of the council to communicate. 48
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Audit scope and responsibilities | 4 Audit scope and responsibilities Scope of the audit 5. The audit is performed in accordance with the Code of Audit Practice, including supplementary guidance, International Standards on Auditing (UK), and relevant legislation. These set out the requirements for the scope of the audit which includes: • An audit of the financial statements and an opinion on whether they give a true and fair view and are free from material misstatement. • An opinion on statutory other information published with the financial statements in the annual accounts, namely the Management Commentary and the Annual Governance Statement. • An opinion on the audited part of the Remuneration Report. • Conclusions on the council's arrangements in relation to the wider scope areas: Financial Management, Financial Sustainability, Vision, Leadership, and Governance, and Use of Resources to Improve Outcomes. • Reporting on the council’s arrangements for securing Best Value. • Providing assurance on the Housing Benefit Subsidy Claim, Non--Domestic Rates Return and the Whole of Government Accounts return. • A review of the council’s arrangements for preparing and publishing statutory performance information. • Provision of an Annual Audit Report setting out significant matters identified from the audit of the annual accounts and the wider scope areas specified in the Code of Audit Practice. Responsibilities 6. The Code of Audit Practice sets out the respective responsibilities of the council and the auditor. A summary of the key responsibilities is outlined below. 49
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Audit scope and responsibilities | 5 Auditor’s responsibilities 7. The responsibilities of auditors in the public sector are established in the Local Government (Scotland) Act 1973. These include providing an independent opinion on the financial statements and other information reported within the annual accounts and concluding on the council’s arrangements in place for the wider scope areas and to secure Best Value. The council’s responsibilities 8. The council has primary responsibility for ensuring proper financial stewardship of public funds, compliance with relevant legislation and establishing effective arrangements for governance, propriety and regularity that enables it to successfully deliver its objectives. The features of proper financial stewardship include: • Establishing arrangements to ensure the proper conduct of its affairs. • Preparation of annual accounts, comprising financial statements that give a true and fair view and other information. • Establishing arrangements for the prevention and detection of fraud, error and irregularities, and bribery and corruption. • Implementing arrangements to ensure its financial position is soundly based. • Making arrangements to secure Best Value. • Establishing an internal audit function. Local Area Network (LAN) 9. The Annual Audit Plan reflects discussions with the members of the Local Area Network (LAN), consisting of the council’s scrutiny partners. No areas of duplication or opportunities to streamline or re-schedule scrutiny activity were identified from these discussions. 50
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Audit of the annual accounts | 6 Audit of the annual accounts Introduction 10. The audit of the annual accounts is driven by materiality and the risks of material misstatement in the financial statements, with greater attention being given to the significant risks of material misstatement. This chapter outlines materiality, the significant risks of material misstatement that have been identified, and the impact these have on the planned audit procedures. Materiality 11. The concept of materiality is applied by auditors in planning and performing an audit, and in evaluating the effect of any uncorrected misstatements on the financial statements or other information reported in the annual accounts. 12. Broadly, the concept of materiality is to determine whether matters identified during the audit could reasonably be expected to influence the decisions of users of the financial statements. Auditors set a monetary threshold when determining materiality, although some issues may be considered material by their nature. Therefore, materiality is ultimately a matter of the auditor’s professional judgement. 13. The materiality levels determined for the audit of the council and its group are outlined in Exhibit 1. Exhibit 1 2025/26 Materiality levels for the council and its group Materiality The council Group Materiality – based on an assessment of the needs of users of the financial statements and the nature of the council operations, the benchmark used to determine materiality is gross expenditure based on the audited 2024/25 financial statements. Materiality has been set at 2% of the benchmark. £19.0 million £23.0 million 51
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Audit of the annual accounts | 7 Materiality The council Group Performance materiality – this acts as a trigger point. If the aggregate of misstatements identified during the audit exceeds performance materiality, this could indicate that further audit procedures are required. Using professional judgement, performance materiality has been set at 65% of planning materiality. £12.4 million £15.0 million Reporting threshold – all misstatements greater than the reporting threshold will be reported. £1.0 million £1.2 million Source: Audit Scotland Significant risks of material misstatement to the financial statements 14. The risk assessment process draws on the audit team’s cumulative knowledge of the council, including the nature of its operations and its significant transaction streams, the system of internal control, governance arrangements and processes, and developments that could impact on its financial reporting. 15. Based on the risk assessment process, significant risks of material misstatement to the financial statements have been identified and these are summarised in Exhibit 2, page 8. These are the risks which have the greatest impact on the planned audit approach, and the planned audit procedures in response to the risks are outlined in Exhibit 2. 16. The risk assessment process is an iterative and dynamic process. The assessment of risks set out in this Annual Audit Plan and Exhibit 2 may change as more information and evidence is obtained over the course of the audit. Where such changes occur, these will be reported to the council and those charged with governance, where relevant. 52
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Audit of the annual accounts | 8 Exhibit 2 Significant risks of material misstatement to the financial statements Risk of material misstatement Planned audit response Fraud caused by management override of controls Management is in a unique position to perpetrate fraud because of management’s ability to override controls that otherwise appear to be operating effectively. The audit team will: • Evaluate the design and implementation of controls over journal entry processing. • Make inquiries of individuals involved in the financial reporting process about inappropriate or unusual activity relating to the processing of journal entries. • Test journals entries, focusing on those that are assessed as higher risk, such as those affecting revenue and expenditure recognition around the year-end. • Evaluate significant transactions outside the normal course of business. • Assess the adequacy of controls in place for identifying and disclosing related party relationships and transactions in the financial statements. • Assess changes to the methods and underlying assumptions used to prepare accounting estimates and assess these for evidence of management bias. 53
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Audit of the annual accounts | 9 Risk of material misstatement Planned audit response Non-Current Assets The council held £1,259 million of property, plant, and equipment (PPE) at 31 March 2025, of which £959.7 million was land and buildings. The council is required to value land and building assets at existing use value where an active market exists for these assets. Where there is no active market, these assets are valued on a depreciated cost replacement (DRC) basis. As a result, there is a significant degree of subjectivity in these valuations which are based on specialist assumptions, and changes in the assumptions can result in material changes to valuations. A number of errors were identified in the prior year relating to the classification of non-current assets, which resulted in a number of significant adjustments being required in the audited accounts. The audit team will: • Evaluate the design and implementation of controls over the valuation and classification processes. • Review the information provided to the valuer and assess this for completeness and accuracy. • Evaluate the competence, capabilities, and objectivity of the valuer. • Obtain an understanding of management’s involvement in the valuation process to assess if appropriate oversight has occurred. • Review the appropriateness of the key data and assumptions used in the 2025/26 valuation process, and challenge these where required. • Review the indices applied by management to assets not subject to valuation in 2025/26 and assess if these are reasonable and have been correctly applied. • Perform substantive testing of a sample of assets from the asset register to check that they have been correctly classified and have not been counted in more than one asset category. • Review the NCA disclosures in the accounts. Source: Audit Scotland Key audit matters 17. The Code of Audit Practice requires public sector auditors to communicate key audit matters. Key audit matters are those matters, that in the auditor’s professional judgement, are of most significance to the audit of the financial statements and require most attention when performing the audit. 18. In determining key audit matters, auditors consider: • Areas of higher or significant risk of material misstatement. • Areas where significant judgement is required, including accounting estimates that are subject to a high degree of estimation uncertainty. • Significant events or transactions that occurred during the year. 54
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Audit of the annual accounts | 10 19. The matters determined to be key audit matters will be communicated in the Annual Audit Report. Exhibit 2 outlines the significant risks of material misstatement to the financial statements that have been identified, including those that have greatest impact on the planned audit procedures and require most attention when performing the audit. Group audit 20. The council is part of a group and prepares group financial statements. The group is made up of nine components, including the council which is the parent of the group. Risk assessment procedures have been performed on the group audit to identify if there are any risks of material misstatement to the group financial statements, or any components where audit procedures are required for the purposes of the group audit. The outcome of the risk assessment procedures on the group audit are outlined in Exhibit 3. Exhibit 3 Outcome of risk assessment procedures on the group audit Group component Accounting treatment Risk of material misstatement Audit procedures required Auditor North Ayrshire Council Consolidated on a line-by-line basis Yes – Exhibit 2 Yes – full scope audit Audit Scotland Common Good Funds Consolidated on a line-by-line basis No – not material to group financial statements Yes – analytical procedures at group level Audit Scotland Trust Funds Consolidated on a line-by-line basis No – not material to group financial statements Yes – analytical procedures at group level Audit Scotland North Ayrshire Ventures Trust Consolidated on a line-by-line basis No – not material to group financial statements Yes – analytical procedures at group level Galbraith Pritchards North Ayrshire Leisure Limited Consolidated on a line-by-line basis No – not material to group financial statements Yes – analytical procedures at group level Azets Audit Services Limited 55
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Audit of the annual accounts | 11 Group component Accounting treatment Risk of material misstatement Audit procedures required Auditor Strathclyde Partnership for Transport (SPT) Accounted for on an equity basis Yes – risk of material misstatement due to estimation in the value of the land and buildings balance included in the council’s share of SPT’s net assets Yes – obtaining assurances on the audit procedures carried out on the valuation of land and buildings in SPT Audit Scotland Strathclyde Concessionary Travel Scheme Joint Board Accounted for on an equity basis No – not material to group financial statements Yes – analytical procedures at group level Audit Scotland Ayrshire Valuation Joint Board Accounted for on an equity basis No – not material to group financial statements Yes – analytical procedures at group level Audit Scotland North Ayrshire Integration Joint Board Accounted for on an equity basis No – not material to group financial statements Yes – analytical procedures at group level Audit Scotland Source: Audit Scotland 21. Where audit procedures are required on a component’s financial statements, and the component auditor is different to the council’s appointed auditor, group audit instructions will be issued to the component auditor outlining expectations and requirements in performing these audit procedures. Audit of the Annual Accounts of the eight section 106 charities administered by the Council 22. Elected members of the Council are trustees for eight registered Scottish charities (the charities): • Anderson Park Trust: charity number - SC042136 • Douglas Sellers Trust: charity number - SC042101 • Margaret Archibald Bequest: charity number - SC042117 • North Ayrshire Charitable Trust: charity number - SC025083 • North Ayrshire Council (Dalry) Charitable Trust: charity number - SC043644 • North Ayrshire Council (Kilbirnie and Glengarnock) Charitable Trusts: charity number - SC043600 56
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Audit of the annual accounts | 12 • North Ayrshire Council (Kilwinning) Charitable Trust: charity number - SC043374 • North Ayrshire Council (Largs) Charitable Trust: charity number - SC043494 23. David Jamieson, of Audit Scotland, has been appointed by the Accounts Commission as external auditor of the charities, for 2025/26, the fourth year of the five-year audit appointment. 24. The Ethical Standard requires auditors to communicate any relationships that may affect the independence and objectivity of the audit team. There are no such relationships pertaining to the audit of the Charities to communicate. 25. The trust balances are disclosed in a note in the council’s Annual Accounts but do not represent assets of the council so are not included within the council’s balance sheet. As a result of the interaction of the Local Government (Scotland) Act 1973 with charities legislation, a full and separate audit and independent auditor’s report is required for each registered charity irrespective of the value of its assets. 26. Our duties as auditors of the charities administered by North Ayrshire Council are to: • express an opinion on whether the charity’s financial statements properly present the charity’s financial position and are prepared in accordance with charities legislation. • read the Trustees’ Annual Report and express an opinion as to whether it is consistent with the financial statements. • report on other matters, by exception, to the Trustees and to the Office of the Scottish Charity Regulator (OSCR). 27. Based on our risk assessment, we have identified one significant audit risk for the Trustees Annual Report and Financial Statements, being “fraud caused by management override of controls”. Our response to this risk includes the same audit procedures as set out in Exhibit 2. 28. Our calculated materiality levels are set out in Exhibit 4. Exhibit 4 2025/26 materiality levels for the charitable trusts Charitable trust Planning Materiality Performance Materiality Reporting Threshold Anderson Park Trust (SC042136) £1 (Based on 2% of audited 2024/25 net asset value; £1 minimum) £1 (Based on 75% of planning materiality; £1 minimum) £1 (Based on 5% of overall materiality; £1 minimum) 57
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Audit of the annual accounts | 13 Douglas Sellers Trust (SC042101) £3 (Based on 2% of audited 2024/25 net asset value) £3 (Based on 75% of planning materiality) £1 (Based on 5% of overall materiality; £1 minimum) Margaret Archibald Bequest (SC042117) £5,756 (Based on 2% of audited 2024/25 net asset value) £4,317 (Based on 75% of planning materiality) £288 (Based on 5% of overall materiality) North Ayrshire Council Charitable Trust (SC025083) £6,255 (Based on 2% of audited 2024/25 net asset value) £4,691 (Based on 75% of planning materiality) £313 (Based on 5% of overall materiality) North Ayrshire Council (Dalry) Charitable Trust (SC043644) £34 (Based on 2% of audited 2024/25 net asset value) £26 (Based on 75% of planning materiality) £2 (Based on 5% of overall materiality) North Ayrshire Council (Kilbirnie & Glengarnock) Charitable Trust (SC043600) £59 (Based on 2% of audited 2024/25 net asset value) £44 (Based on 75% of planning materiality) £3 (Based on 5% of overall materiality) North Ayrshire Council (Kilwinning) Charitable Trust (SC043374) £85 (Based on 2% of audited 2024/25 net asset value) £64 (Based on 75% of planning materiality) £4 (Based on 5% of overall materiality) North Ayrshire Council (Largs) Charitable Trust (SC043494) £45 (Based on 2% of audited 2024/25 net asset value) £33 (Based on 75% of planning materiality) £2 (Based on 5% of overall materiality) 29. The Code of Audit Practice includes provisions relating to the audit of smaller audits. In light of the volume and lack of complexity of the financial transactions, we plan to apply the less complex body provision of the Code to the 2025/26 audit of the charities. 30. No significant risks in the wider scope areas or Best Value were identified from the risk assessment process. 31. Our work on the Trustees Annual Report and Financial Statements will be undertaken in line with the audit timetable set out in Exhibit 5. 58
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Wider scope audit | 14 Wider scope audit Introduction 32. Reflecting the fact that public money is involved, the Code of Audit Practice requires that public audit is planned and undertaken from a wider perspective than in the private sector. The wider scope audit set out by the Code of Audit Practice broadens the audit of the annual accounts to include consideration of additional aspects or risks in four wider scope areas, which are summarised below: • Financial Management – this means having sound budgetary processes. Factors that can impact on the council being able to secure sound financial management include the strength of the financial management culture, accountability, and arrangements to prevent and detect fraud, error and other irregularities, bribery and corruption. • Financial Sustainability – this means looking forward over the medium and longer term in planning the services to be delivered and how they will be delivered effectively. This is assessed by considering the council’s medium to longer-term planning for service delivery. • Vision, Leadership and Governance – this means having a clear vision and strategy, with set priorities within the vision and strategy. This is assessed by considering the clarity of plans in place to deliver the vision and strategy and the effectiveness of the governance arrangements to support delivery. • Use of Resources to Improve Outcomes – this means using resources to meet stated outcomes and improvement objectives through effective planning and working with partners and communities. This is assessed by considering the council’s arrangements for ensuing resources are deployed to improve strategic outcomes, meet the needs of service users, and deliver continuous improvement. 33. A conclusion on the effectiveness and appropriateness of arrangements the council has in place for each of the wider scope areas will be reported in the Annual Audit Report. 59
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Wider scope audit | 15 Significant wider scope risks 34. No significant risks in the wider scope areas were identified from the risk assessment process. 60
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Best Value audit | 16 Best Value audit Introduction 35. Under the Code of Audit Practice, the audit of Best Value in councils is fully integrated within the annual audit. As part of the annual audit, auditors are required to take a risk-based approach to assessing and reporting on whether the council has made proper arrangements for securing Best Value, including follow up of findings previously reported in relation to Best Value. 36. The Accounts Commission also reports nationally on thematic aspects of councils’ approaches to, and performance in, meeting their Best Value duties. As part of the annual audit, thematic reviews, as directed by the Accounts Commission, are conducted on the council. The thematic review for 2025/26 covers asset management, considering how the council is managing its assets to ensure high quality services whilst also responding to the challenges around financial sustainability and climate change. Conclusions and judgements on the thematic review will be reported in a separate Management Report and summarised in the Annual Audit Report.. 37. In addition, auditors are required to carry out a review of the ‘fairness and equality’ theme at least once during the audit appointment, and this will be carried out during the 2025/26 audit. 38. At least once over the five-year appointment, the Controller of Audit will report to the Accounts Commission on the council’s performance in meeting its Best Value duties. The Accounts Commission considered the Controller of Audit report on the council in October 2025. There are no plans for any further Controller of Audit reports on the council currently. 39. Auditors have a statutory duty to satisfy themselves that councils have made proper arrangements for preparing and publishing statutory performance information in accordance with the Statutory Performance Information Direction 2024 (the Direction) issued by the Accounts Commission. The outcome of this will be reported in the Annual Audit Report, which will include: • A conclusion on the council’s arrangements for preparing and publishing the statutory performance information. • Any instances where the arrangements or reporting are not in accordance with the Direction. • Areas where the arrangements require to be improved. 61
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Best Value audit | 17 40. In addition, the Accounts Commission requires auditors to include a summary of Local Government Benchmarking Framework (LGBF) indicators that the council has reported in the Annual Audit Report. Significant Best Value risks 41. No significant Best Value risks were identified from the risk assessment process. Audit work on the wider scope areas will help support conclusions around Best Value. 62
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Reporting arrangements, timetable and audit fee | 18 Reporting arrangements, timetable and audit fee Audit outputs 42. The outputs from the 2025/26 audit include: • This Annual Audit Plan. • A Best Value Management Report on asset management. • An Independent Auditor’s Report to the council and the Accounts Commission setting out opinions on the annual accounts. • An Annual Audit Report to the council and the Accounts Commission setting out significant matters identified from the audit of the annual accounts, conclusions from the wider scope and Best Value audit, recommendations, where required, and any good practice identified. 43. The matters to be reported in the outputs will be discussed with the council for factual accuracy before they are issued. All outputs from the audit will be published on Audit Scotland’s website, apart from the Independent Auditor’s Report, which is included in the audited annual accounts. 44. Target dates for the audit outputs are set by the Accounts Commission. In setting the target dates for the audit outputs, consideration is given to the statutory date for approving the annual accounts, which is 30 September 2026 for local government bodies. 45. The Independent Auditor’s Report and Annual Audit Report are planned to be issued by the target date of 30 September 2026. Audit timetable 46. Achieving the timetable for production of the annual accounts, supported by complete and accurate working papers, is critical to delivery of the audit to agreed target dates. Exhibit includes a timetable for the audit, which has been agreed with management. Agreed target dates will be kept under review as the audit progresses, and any changes required, and their potential impact, will be discussed with the council and reported to those charged with governance, where required. 63
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Reporting arrangements, timetable and audit fee | 19 Exhibit 5 2025/26 audit timetable Audit activity The council target date Audit team target date Relevant committee date Issue of Annual Audit Plan 27 February 2026 12 March 2026 Annual Accounts: • Consideration of unaudited annual accounts by those charged with governance 24 June 2026 24 June 2026 • Submission of unaudited annual accounts and all working papers to audit team 26 June 2026 • Latest date for audit clearance meeting 11 September 2026 11 September 2026 • Issue of draft Letter of Representation, proposed Independent Auditor’s Report, and proposed Annual Audit Report 17 September 2026 24 September 2026 • Agreement of audited and unsigned annual accounts 17 September 2026 • Approval by those charged with governance and signing of audited annual accounts 24 September 2026 24 September 2026 • Signing of Independent Auditor’s Report and issue of Annual Audit Report 24 September 2026 Issue of Best Value Management Report 11 September 2026 24 September 2026 Certification of Non-Domestic Rates Return 9 October 2026 Certification of Housing Benefit Subsidy Claim 30 November 2026 Certification of Whole of Government Accounts 2 October 2026 Source: Audit Scotland 64
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Reporting arrangements, timetable and audit fee | 20 Audit fee 47. The council’s audit fee is determined in line with Audit Scotland’s fee setting arrangements. The proposed fee for the 2025/26 audit is £401,680 (£384,980 in 2024/25). Information on the components that make up the total fee can be found in Audit Scotland’s Audit management and quality guidance. 48. We have also proposed an audit fee of £1,100 (£1,100 in 2024/25) for the audit of the registered charities administered by the council. 49. In setting the audit fee, it is assumed that the council has effective governance arrangements in place and the complete annual accounts will be provided for audit in line with the agreed timetable. The audit fee assumes there will be no significant changes to the planned scope of the audit. Where the audit cannot proceed as planned, for example, due to incomplete or inadequate working papers, the audit fee may need to be increased. 65
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Other matters | 21 Other matters Internal audit 50. The council is responsible for establishing an internal audit function as part of an effective system of internal control. As part of the audit, the audit team will obtain an understanding of internal audit, including its nature, responsibilities, and activities. 51. While internal audit and external audit have differing roles and responsibilities, external auditors may seek to rely on the work of internal audit where it is considered appropriate. A review of internal audit’s 2025/26 audit plan was carried out to identify if there were any areas where the audit team could rely on its work. The audit team concluded it will not rely on internal audit’s work. However, the audit team will review internal audit's reports and assess if there is any impact on the audit. Audit quality 52. Audit Scotland is committed to the consistent delivery of high-quality audit. Audit quality requires ongoing attention and improvement to keep pace with external and internal changes. Details of the arrangements in place for the delivery of high-quality audits is available from the Audit Scotland website. 53. The International Standards on Quality Management (ISQM) applicable to Audit Scotland for 2025/26 audits are: • ISQM (UK) 1, which deals with an audit organisation’s responsibilities to design, implement, and operate a system of quality management (SoQM) for audits. Audit Scotland’s SoQM consists of a variety of components, such as governance arrangements and culture to support audit quality, compliance with ethical requirements, ensuring Audit Scotland is dedicated to high- quality audit through engagement performance and resourcing arrangements, and ensuring there are robust quality monitoring arrangements in place. Audit Scotland carries out an annual evaluation of its SoQM and has concluded it complies with this standard. • ISQM (UK) 2, which sets out arrangements for conducting engagement quality reviews, which are performed by senior management not involved in an audit, to review significant judgements and conclusions reached by the audit team, and the appropriateness of proposed audit opinions on high-risk audits. 66
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Other matters | 22 54. To monitor quality at an individual audit level, Audit Scotland carries out internal quality reviews on a sample of audits. Additionally, the Institute of Chartered Accountants of England and Wales (ICAEW) carries out independent quality reviews on a sample of audits. 55. Actions to address deficiencies identified by internal and external quality reviews are included in a rolling Quality Improvement Action Plan, which is used to support continuous improvement. Progress with implementing planned actions is monitors on a regular basis by Audit Scotland’s Quality and Ethics Committee. 56. Audit Scotland may periodically seek the views of the council on the quality of audit services provided. The audit team would also welcome feedback at any time. 67
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North Ayrshire Council Annual Audit Plan 2025/26 Audit Scotland, 4th Floor, 102 West Port, Edinburgh EH3 9DN Phone: 0131 625 1500 www.audit.scot AS.5.0 68
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OFFICIAL INFORMATION OFFICIAL INFORMATION NORTH AYRSHIRE COUNCIL 12 March 2026 Audit and Scrutiny Committee Title: Internal Audit Reports Issued Purpose: To inform the Committee of the findings of Internal Audit work completed since January 2026. Recommendation: That the Committee considers the outcomes from the Internal Audit work completed. 1. Executive Summary 1.1 The Council's local Code of Corporate Governance requires effective arrangements to be put in place for the objective review of risk management and internal control. Internal Audit is an important element in this framework as it reviews internal controls and offers Elected Members and officers an objective and independent appraisal of how effectively resources are being managed. 1.2 The remit of the Audit and Scrutiny Committee includes the monitoring of Internal Audit activity. The submission of regular reports assists the Committee in fulfilling this remit. 2. Background 2.1 This report provides information on Internal Audit work completed since January 2026. Internal control reviews have been completed in respect of the areas detailed in Appendix A to this report. The aim of these reviews is to provide assurance that the internal control framework within the areas examined is appropriate and operating effectively. 2.2 The findings from each audit assignment have been notified in writing to the Chief Executive, the Section 95 Officer and the relevant Executive Director and Head of Service on the completion of each assignment. Where appropriate, this has included an action plan with recommendations for improving internal control. Appendix A includes the report and action plan from each audit. 2.3 There are several audits nearing completion that will be presented to the following committee. These include the Payroll Transactional testing, Capital Monitoring & Buildings and Estate Maintenance audits. 2.4 The findings from the audit assignment completed are detailed at Appendix A to this report and the levels of assurance for each are noted in the table below: Audit Title Assurance Level School Funds Substantial Agenda Item 8 69
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OFFICIAL INFORMATION OFFICIAL INFORMATION 3. Proposals 3.1 It is proposed that the Committee notes the outcomes from the Internal Audit work completed since January 2026. 4. Implications/Socio-economic Duty Financial 4.1 None. Human Resources 4.2 None. Legal 4.3 None. Equality/Socio-economic 4.4 None. Climate Change and Carbon 4.5 None. Key Priorities 4.6 The work of Internal Audit helps to support the efficient delivery of the strategic priorities within Our Council Plan 2023-2028. Community Wealth Building 4.7 None. Islands Communities Impact Assessment (ICIA) 4.8 None. United Nations Rights of the Child (UNCRC) 4.9 None. Consumer Duty 4.10 None. 5. Consultation 70
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OFFICIAL INFORMATION OFFICIAL INFORMATION 5.1 The relevant Services are consulted on Internal Audit findings during each audit assignment. Mark Boyd Head of Service (Finance) For further information please contact Paul Brown, Senior Manager (Internal Audit), on paulbrown01@north-ayrshire.gov.uk. Background Papers None. 71
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Appendix A OFFICIAL INFORMATION OFFICIAL INFORMATION SCHOOL FUNDS 1 Background 1.1 School funds are defined as funds which are associated with a particular school but have not been provided by North Ayrshire Council. 1.2 Whilst school funds are separate to council funds, the Council has a legal responsibility to ensure they are appropriately managed. 2 Objectives and Scope 2.1 The objective of this audit was to ensure: - • Schools are provided with sufficient guidance on how to manage school funds. • Schools have implemented processes in line with the guidance. 3 Findings Guidance 3.1 Education has a School Fund procedure document which provides guidance on managing school funds 3.2 This procedure has recently been refreshed and is due to be presented to Education’s Policy Review Group in early 2026 for final approval. 3.3 Audit reviewed both the existing, and a draft version of the refreshed procedure. Both versions cover the same key topics, which are:- • General administration • Cash held • Bank accounts • Expenditure • Income • Record keeping • Audits • Retention of records • Closure of school funds 3.4 Education confirmed that the existing guidance is made available to schools via Glow Management of School Funds 3.5 To gain an understanding of how school funds are being managed across all North Ayrshire schools and independent Early Years Centres, Audit asked all establishments to complete a detailed questionnaire. 3.6 The questionnaire was designed to cover all key areas of school fund management. 3.7 Establishments were asked to confirm:- • They have an up-to-date constitution document for the school fund • Fund members meet regularly to discuss the management of the fund • Fund accounts are audited annually • Fund records are retained in line with Council retention requirements 72
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Appendix A OFFICIAL INFORMATION OFFICIAL INFORMATION • Officers with a responsibility for administering the school fund have attended cash handling training • Cash is banked intact • They are aware of the VAT free purchase scheme for qualifying equipment purchases 3.8 Establishments were asked to give a brief description of:- • The process for reconciling school fund records • How cash is stored on site • How cash is banked (eg using G4S or via officers taking cash to the bank) • The process for authorising expenditure • The payments methods used for expenditure 3.9 Establishments were asked to provide: - • a transaction report for 2024/25 • copies of keyholder registers 3.10 Audit received responses from all establishments (9 secondary, 50 primary, 5 Early Year Centres and 1 ASN school). Audit reviewed the return from each establishment. 3.11 The most notable finding was that 3 schools are relying on verbal authorisation for school fund expenditure. 2 of these 3 schools confirmed they are working on introducing a written authorisation process. Audit raised the issue of the 3rd school with the relevant Education Business Officer (EBO) who immediately advised the school on the need to introduce a new authorisation process. (action point a) 3.12 Other issues identified included:- • Not all officers had completed cash handling training • Some keyholder registers needing updated 3.13 Any issues identified were raised with the relevant EBO and as a result:- • All officers have now either attended a cash handling training course, or are awaiting the online version, due to be released early 2026. • Updated keyholder registers have either been provided directly to Audit, or EBOs have confirmed the updates are in the process of being completed. 3.14 In addition to the above review, Audit also undertook establishment visits at a small sample of schools to carry out more in-depth audit testing. This testing included:- • Securing all cash on arrival, counting it and agreeing it to fund records • Testing a sample of lodgements to supporting documentation • Testing a sample of expenditure items to supporting documentation, ensuring it has been authorised • Ensuring reconciliations to bank statements are being undertaken regularly • Ensuring historical records are being retained 3.15 No issues were identified during site visits. 3.16 All establishments are required to submit copies of audited accounts and bank account information to Financial Management by 30th November each year. 3.17 Financial Management have confirmed that (as at 12/12/2025) the majority of submissions have been received. Financial Management have chased outstanding 73
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Appendix A OFFICIAL INFORMATION OFFICIAL INFORMATION submissions and intend to review each submission to ensure accuracy and completeness. 4 Internal Audit Opinion 4.1 Overall, substantial assurance was obtained with regard to the overall management of school funds. School funds are generally well-managed. Any minor issues identified during the audit have been addressed promptly by the EBO/school. Definitions of Assurance Levels: Substantial A sound system of governance, risk management and control exist, with internal controls operating effectively and being consistently applied to support the achievement of objectives in the area audited. Reasonable There is a generally sound system of governance, risk management and control in place. Some issues, non-compliance or scope for improvement were identified which may put at risk the achievement of objectives in the area audited. Limited Significant gaps, weaknesses or non-compliance were identified. Improvement is required to the system of governance, risk management and control to effectively manage risks to the achievement of objectives in the area audited. None Immediate action is required to address fundamental gaps, weaknesses or non-compliance identified. The system of governance, risk management and control is inadequate to effectively manage risks to the achievement of objectives in the area audited. NB The level of assurance given is at the discretion of Internal Audit. 74
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Appendix A OFFICIAL INFORMATION OFFICIAL INFORMATION KEY FINDINGS AND ACTION PLAN SCHOOL FUNDS Action a Finding Verbal authorisation of school fund expenditure is being used in 3 schools. Action Description A process where written authorisation is retained for all school fund expenditure should be implemented in these 3 schools. Risk Misappropriation of school funds; failure to comply with the Council’s school funds procedures. Priority (1, 2, 3) 2 Paragraph Reference 3.11 Managed by Head of Service (Education) Assigned to Senior Education Business Officer (EBO) Due Date 28 February 2026 Management Comment A process for written authorisation for school fund expenditure will be implemented for the three schools identified in the report and the Senior EBO will review the situation annually thereafter. 75
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OFFICIAL INFORMATION OFFICIAL INFORMATION NORTH AYRSHIRE COUNCIL 12 March 2026 Audit and Scrutiny Committee Title: Internal Audit Plan 2026/27 Purpose: To inform the Committee of the proposed internal audit plan for 2026/27. Recommendation: That the Committee approves the internal audit plan for 2026/27. 1. Executive Summary 1.1 Internal Audit provides an independent and objective opinion on the Council’s risk management, governance and control environment by evaluating its effectiveness. This report presents the proposed internal audit plan for 2026/27. 1.2 Prior to the start of each financial year internal audit, in conjunction with senior management, put together a proposed plan of audit work. The objective of our planning process and subsequent plan is to put us in a position to provide a well- informed and comprehensive annual audit opinion, based on sufficient and appropriate coverage of key business objectives and risk management processes. 1.3 The proposed internal plan is risk-based and provides sufficient coverage to support an annual audit opinion while retaining the flexibility to respond to emerging risks. 2. Background Internal Audit Plan 2026/27 2.1 The 2026/27 plan has been developed using the rolling approach first used in 2024/25 and continued in 2025/26. This method ensures the plan remains flexible and responsive to changing risks across the Council. The plan is essentially two phased: • Phase 1, this paper, will cover quarters 1 and 2 in terms of the planned audits for the first 6 months of the financial year. • Phase 2, or the mid-year review, will identify the audits to be carried out in quarters 3 and 4. • Quarter 3 and 4’s audits are selected from the rolling list of potential audit assignments. Agenda Item 9 77
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OFFICIAL INFORMATION OFFICIAL INFORMATION 2.2 The benefit of this approach is that it allows the internal audit team to remain flexible, agile and capable of responding to emerging risks. This approach is also in line with the new Global Internal Audit Standards (GIAS) which came into effect on 1 April 2025 and require the audit plan to be risk-based. 2.3 Several factors are considered when putting together the risk based internal audit plan for 2026/27, including: • Consultation with senior management across all services; • Review of the Council’s key objectives and Council Plan 2023-2028; • Review of the audit universe, in conjunction with senior management; • Review of the Council’s fundamental business processes and key services; • Review of the Council's current risk management framework, processes and risk management maturity; • Review of the key risks featuring in the Council's risk registers; • Internal Audit’s own risk assessment based on knowledge of the business and incorporating findings from previous internal audit work; and • Internal Audit’s awareness of emerging regional and national risk factors. 2.4 The risk universe is a documented risk assessment maintained by internal audit and used to document the consultation which takes place between internal audit and senior management. It outlines risk factors such as: • Links to the strategic priorities within the Council Plan for 2023-2028; • Links to strategic, corporate and operational risk registers; • Whether the auditable area is a source of significant risk; • Whether there is significant value to the Council in the audit being carried out; • Known risk factors arising from local and national issues; and • Risk factors arising from previous internal audit work and knowledge of the Council. 2.5 An overall conclusion is reached from an assessment of each risk area, which categorises audits into the following priorities: • Priority A – a ‘must do’ audit based on risk (very high risk); • Priority B – a ‘should do’ audit, time permitting (high risk); • Priority C – a ‘may do’ audit, time permitting (moderate risk); and • Priority D – an audit where the result would not be of sufficient value to the Council (low risk). 2.6 Examples of the key risk factors which have influenced the early part of the 2026/27 internal audit plan are as follows: • Cyber resilience continues to be a high priority across organisations and is identified as a strategic risk for the Council. The Internal Audit team has, over a number of years, utilised the Scottish Government’s Cyber Resilience Framework as the basis for ICT audit work, and this risk-based approach will continue to inform the 2026/27 audit plan. • The enacting of legislation such as Awaab’s Law will see the implementation of legally enforced deadlines for investigations and repairs. Internal Audit will 78
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OFFICIAL INFORMATION OFFICIAL INFORMATION provide assurance to the Council through planned work relating to dampness and mould. • The Council has recently implemented, or is the process of implementing, significant system changes, including upgrades to the general ledger and the introduction of a new social work system within the HSCP. Effective implementation and control of these systems is critical, given their role in producing reliable management and financial information. 2.7 The overall objective of the work of internal audit is to enable the Senior Manager to form an evidence based independent opinion at the end of the year on the adequacy of the Council’s internal control, risk and governance arrangements. This opinion, which will be outlined in the annual audit report, also forms part of the Annual Governance Statement for the year which is included within the Council’s financial statements. 2.8 Whilst the audit plan is risk based and the current work has identified audits planned for the first 6 months of the year, it is also agile. The implications of this are that previously agreed work could be deferred should a new risk profile arise. Any such changes will be presented back to the committee through the regular reporting to Audit & Scrutiny. 2.9 Internal audit coverage can never be absolute, and responsibility for risk management, governance and internal control arrangements will always remain fully with management. As such, internal audit cannot provide complete assurance over any area, and equally cannot provide any guarantee against material errors, loss or fraud. 2.10 Appendix A contains the internal audit plan for quarters one and two of 2026/27. The plan will be added to throughout the year, with a list of potential audit areas provided at Appendix B. Audit titles and high-level scopes are indicative at this stage for planning our resources. At the start of each audit, detailed planning will be carried out to agree the objectives and the scope of the work. The plan will therefore be subject to change throughout the year, depending on several factors such as available resources, time required to complete reviews, and unplanned work arising throughout the year. 2.11 The Senior Manager is required to ensure that internal audit resources are appropriate, sufficient and effectively deployed to achieve the approved plan. The Internal Audit Team currently comprises a Senior Manager, an Internal Audit Manager, two Internal Auditors and a Computer Auditor. All members of the team hold professional accountancy or audit qualifications and are suitably experienced. 2.12 In addition to the programme of audit work to be carried out, time is also required to be set aside throughout 2026/27 to support the following areas: • Consultancy – both ad hoc advice and project work • Follow up of prior year internal audit action points • Staff training • Audit planning and monitoring • Committee attendance and reporting • Development of the internal audit service • Self-assessment on the new Global Internal Audit Standards • Review of governance documents such as the Annual Governance Statement. 79
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OFFICIAL INFORMATION OFFICIAL INFORMATION Conformance with the Global Internal Audit Standards (GIAS) 2.13 The Global Internal Audit Standards came into effect in April 2025, replacing the Public Sector Internal Audit Standards (PSIAS). The Senior Manager will complete a self-assessment against the new standards, the results of which will be included within the annual audit report. 2.14 The outcome of this self-assessment may identify areas where changes to internal audit processes or procedures are required. Any such changes will be captured within a formal action plan with clearly defined timescales for implementation. 2.15 Completion of this self-assessment will also form a key element of preparation for the External Quality Assessment (EQA) of the internal audit function, which is scheduled to be undertaken in 2027. The most recent EQA was carried out in 2022 under the now superseded PSIAS and concluded that the internal audit service was fully or generally conformant with all 14 standards. This provides a strong foundation from which the service can move towards full conformance with the Global Internal Audit Standards. 2.16 Similar to PSIAS, the GIAS require the Senior Manager to develop and maintain a quality assurance and improvement programme (QAIP). The planned self- assessment due will provide a key foundation for this programme, alongside the EQA planned for in 2027. Internal Audit Performance 2.17 As part of the progress reporting regime, we will report on internal audit performance. The following targets will be used to measure the performance of the internal audit activity Performance Measure Performance Target Delivery of internal audit plan – percentage completed at year end >85% Quality of audit work – overall client satisfaction >90% Outcomes from audit work – value to the organisation >90% 2.18 The Internal Audit Charter is a formal document which defines the internal audit activity’s purpose, authority and position. The Senior Manager reviews the Internal Audit Charter on an annual basis and presents any changes to the Audit and Scrutiny Committee for approval. In March 2025, the Audit & Scrutiny Committee approved the changes to the Internal Charter to ensure alignment with the requirements of the GIAS. 3. Proposals 3.1 It is proposed that the Committee approves the Internal Audit plan for 2026/27. 80
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OFFICIAL INFORMATION OFFICIAL INFORMATION 4. Implications/Socio-economic Duty Financial 4.1 None. Human Resources 4.2 None. Legal 4.3 None. Equality/Socio-economic 4.4 None. Climate Change and Carbon 4.5 None. Key Priorities 4.6 The work of Internal Audit helps to support the efficient delivery of the strategic priorities within the Council Plan 2023-2028. Community Wealth Building 4.7 None. Islands Communities Impact Assessment (ICIA) 4.8 None. United Nations Rights of the Child (UNCRC) 4.9 None. Consumer Duty 4.10 None. 5. Consultation 5.1 Consultation has taken place on an individual basis with the Executive Leadership Team during the preparation of the Internal Audit plan. Mark Boyd Head of Service (Finance) 81
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OFFICIAL INFORMATION OFFICIAL INFORMATION For further information please contact Paul Brown, Senior Manager (Audit, Fraud, Safety, Risk and Insurance), on paulbrown1@north-ayrshire.gov.uk. Background Papers None. 82
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OFFICIAL INFORMATION OFFICIAL INFORMATION Internal Audit Plan 2026/27 Quarters 1 & 2 Appendix A Audit Area to Deliver in Plan Directorate/Service Planned Quarter Priority Link to Council Plan Link to Risk Registers Grants Compliance Communities & Housing Q1 B Communities and Local Democracy – we will have active, inclusive and resilient communities Operational Risk General Ledger Finance Q2 B n/a n/a Accounts Payable Transactions People & ICT Q2 A A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities n/a ICT – Incident Detection People & ICT Q1 B A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities Strategic Risk School Inventory Management Education Q1 B A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities n/a Neighbourhood Services – Overtime Place Q1 B Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people Operational Risk Absence Management (specifically EDU/HSCP) People & ICT Q2 A Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people n/a Headstone Inspections Place Q1 B Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people n/a Business Continuity Planning HSCP Q2 B Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people Corporate/Operational Risk Tenants and Residents Associations Communities & Housing Ongoing D Communities and Local Democracy – we will have active, inclusive and resilient communities n/a 83
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OFFICIAL INFORMATION OFFICIAL INFORMATION Rolling Internal Audit Plan Appendix B These reviews will form part of the rolling plan for 2026/27. The plan will continue to be adjusted as the year progresses to reflect current organisational risks and issues. Ongoing risk assessments will be undertaken to determine the priority areas to include in the plan. Potential Future Audit Areas Directorate/Service Priority Link to Council Plan Link to Risk Registers Corporate - Performance All B All N/A Corporate - Business Continuity Planning All C A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities Corporate Risk and Operational Risk Stores Controls Communities & Housing C A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities N/A Community Associations Communities & Housing B Communities and Local Democracy – we will have active, inclusive and resilient communities Operational Risk ALEO Arrangements Communities & Housing C Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people N/A Void Management (27/28 onwards) Communities & Housing C Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people Operational Risk Trading Standards Communities & Housing D Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people N/A Dampness & Mould Communities & Housing A Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people N/A Housing Repairs (27/28 onwards) Communities & Housing / Place C A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities N/A Tenant Safety (fire/gas) Communities & Housing / Place B Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people N/A Freedom of Information/Subject Access Requests (27/28 onwards) Democratic A A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities Corporate and Operational Risk Residential Placements Education B Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people Operational Risk Education - Handling of Medication Education B Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people N/A 84
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OFFICIAL INFORMATION OFFICIAL INFORMATION Management of Allergens in Schools Education B Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people Operational Risk School Roll Forecasting Education C A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities N/A Facilities Management Timesheet Processes Education C N/A N/A Placement Requests Education C Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people Operational Risk Community Based Support - Young People HSCP B Communities and Local Democracy – we will have active, inclusive and resilient communities Operational Risk Financial Assessments - non- residential HSCP C Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people N/A Commissioning – including supplier failure HSCP B A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities Strategic Risk Review of HSCP Charging Policy HSCP C A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities Operational Risk Implementation of new Social Work System HSCP B Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people N/A Transitioning Arrangements (27/28 onwards) HSCP C Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people N/A Coming Home Agenda (27/28 onwards) HSCP C Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people N/A Integration Joint Board Audit Days IJB A N/A N/A Payroll Transaction Testing People & ICT A A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities N/A Agency Staff & Workers (IR35) People & ICT B A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities N/A ICT – Network Security People & ICT B A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities Strategic Risk Council Tax – Second Homes Finance/People &ICT C A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities N/A 85
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OFFICIAL INFORMATION OFFICIAL INFORMATION Contract Management/Monitoring Finance C A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities N/A Artificial Intelligence & Governance All C A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities N/A Fuel Controls Place B A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities N/A Sustainability Climate Change (27/28 onwards) Place B Climate Change – achieving net-zero by 2030 Strategic Risk and Operational Risk Waste Management – Special Uplifts Place C Climate Change – achieving net-zero by 2030 Operational Risk Playpark/Tree Management/Street Furniture Inspection Arrangements Place B Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people N/A Deposit Return Scheme (27/28 onwards) Place C Climate Change – achieving net-zero by 2030 Operational Risk Assets – Property Lifecycle Investment (27/28 onwards) Place B A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities Strategic & Operational Risk Ayrshire Growth Deal Place A A Sustainable Council – a Community Wealth Building Council that is efficient and accessible, maximising investment and focusing resources towards our priorities Operational Risk Fire Safety Risk Management Place A Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people Operational Risk Local Growth Fund (27/28 onwards) Place C Wellbeing – to transition to a wellbeing economy, delivering prosperity, wellbeing and resilience for local people Operational Risk 86