IA Annual Plan 2026-27 (AEPB)
North Ayrshire Council · 29 September 2026
Back to Ayrshire Economic Partnership Board — 29 September 2026 and its agenda
Text extracted from the council's PDF. Layout and reading order may differ from the original.
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AYRSHIRE ECONOMIC PARTNERSHIP BOARD MEETING – 29 SEPTEMBER 2026 REPORT BY INTERIM CHIEF AUDITOR, EAST AYRSHIRE COUNCIL SUBJECT: AGD INTERNAL AUDIT PLAN 2026/27 PURPOSE OF REPORT 1. The purpose of this report is to provide for noting an annual consolidated internal audit plan in line with obligations laid out in the Ayrshire Growth Deal (AGD) Governance Document (Appendix 1). RECOMMENDATIONS 2. The Partnership Board is asked to: (i) Consider and endorse the Internal Audit Annual Plan 2026/27. (ii) Recommend the report for consideration by the Ayrshire Economic Joint Committee (AEJC), noting the statutory context at paragraph 3. BACKGROUND REQUIREMENT TO HAVE AN INTERNAL AUDIT FUNCTION 3. The Local Authority Accounts (Scotland) Regulations 2014 require local authorities to operate a professional and objective internal auditing service; in practice this means that the internal audit function is operationally independent; free from limitations on the scope of its work and that the Chief Auditor reports independently with no undue influence. The internal audit service must be provided in accordance with recognised standards and practices which from 1 April 2025 are the Global Internal Audit Standards (GIAS) in the UK Public Sector, which are a combination of the Global Internal Audit Standards (GIAS) (IIA, January 2024), GIAS in the UK Public Sector – Application Note (IASAB, December 2024), and the CIPFA Code of Practice for the Governance of Internal Audit (2025). It is the responsibility of each authority to ensure compliance with these professional standards. CONTROL ENVIRONMENT WITHIN COUNCILS 4. Each Council is responsible for establishing and maintaining appropriate risk management processes, control systems, accounting records and governance arrangements. 5. Internal Audit reports are presented to senior management and include recommendations that, when implemented, will further improve the control environment.
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MAIN REPORT INTERNAL AUDIT PLANNING 6. From 2021/22 each Council, in line with professional requirements, carries out a risk assessment and decides how many days are to be allocated to the AGD in year. These days are approved as part of each Council’s Annual Internal Audit Plan by the relevant audit committee in line with the GIAS. The approved days are consolidated and brought to the AEPB and AEJC. The Plans are informed by the Audit Scotland publications listed in Background Papers. The 2026/27 Plan is attached at Appendix 2. 7. The primary purpose of Internal Audit work is to inform an annual opinion on adequacy and effectiveness of the framework of governance, risk management and control of an entity (usually a Council); in this case the AGD is a relatively small entity nestled within the assurance frameworks of the three Councils. Therefore, AGD Internal Audit Plans are developed to be proportionate and appropriate considering that wider assurance framework (including external and internal audit) and topical guidance (e.g. the Treasury Green Book). REPORTING ARRANGEMENTS FOR INDIVIDUAL INTERNAL AUDIT ASSIGNMENTS 8. On 13 September 2021 the AEJC agreed that outcomes from individual internal audit assignments will be shared with the established readership in the Council which carried out the work, the East Ayrshire Council Chief Auditor and members of the AEJC and other relevant forums in line with any revisions to governance arrangements agreed by the AEJC. Through the PMO, assignment reports are placed within an “audit room” on the AGD portal. A summary of this work is included in the separate AGD Internal Audit Annual Report for consideration today by the AEPB and AEJC. IMPLICATIONS 9. Eight implications have been considered in the preparation of this report. Implications Yes No Paragraph number in report 1. Policy/Strategic Planning No 2.Governance No 3. Human Resources No 4. Equality and Fairer Scotland Duty No 5. Financial No 6. Risk Yes Para 10 7. Community Wealth Building No 8. Net Zero No RISK IMPLICATIONS (INTERNAL AUDIT RESOURCES) 10. Each year there is the ongoing risk of significant unplanned work emerging in each Council, planned resources for AGD work not being available and work not
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being carried out to an acceptable standard which would compromise the ability to complete sufficient work to produce an Annual Internal Audit Opinion for the AGD; local mitigations should offset the potential impact of these risks. APPENDICES 11. The report is supported by two appendices: • Appendix 1: AGD Governance Document V16 (Internal Audit Extract) • Appendix 2: AGD Consolidated Internal Audit Annual Plan 2026/27 Paul Davies Interim Chief Auditor, East Ayrshire Council 15 September 2026 BACKGROUND PAPERS 1. Chartered Institute of Public Finance & Accountancy (CIPFA), CIPFA Statement on the Role of the Head of Internal Audit in Public Service Organisations (2nd edition April 2019) 2. Audit Scotland, Scotland’s City Region & Growth Deals (January 2020) 3. Audit Scotland, Scotland’s City Region & Growth Deals Follow-Up (August 2023) 4. Ayrshire Economic Joint Committee, 23 June 2025, AGD Governance Document V16 Deal Documents - All Documents (south-ayrshire.gov.uk) Person to Contact: Paul Davies, Interim Chief Auditor, East Ayrshire Council Email: paul.davies@east-ayrshire.gov.uk Implementation Officers: Paul Davies, Audit Manager, East Ayrshire Council Email: paul.davies@east-ayrshire.gov.uk Paul Brown, Senior Manager (Audit, Fraud, Safety, Risk & Insurance), North Ayrshire Council Email: paulbrown1@north-ayrshire.gov.uk Cecilia McGhee, Chief Internal Auditor, South Ayrshire Council Email: Cecilia.McGhee2@south-ayrshire.gov.uk
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Appendix 1 AGD GOVERNANCE DOCUMENT V16 (INTERNAL AUDIT EXTRACT) 2.16 The Accountable Body’s Chief Auditor will be appointed as Chief Auditor for the AGD to coordinate Internal Audit activity. 2.17 Each partner will be responsible for allocating Internal Audit resources as required for local AGD activities. The Accountable Body’s Internal Audit section will reserve the right to review programme and project activities as required and request information from all partners regarding these activities. 2.18 Each year a consolidated Internal Audit Plan will be presented to the AEJC and AREP having been prepared following: • consultation with relevant senior officers of the AGD PMO; • consideration of the risks affecting the AGD at programme and project level; • consideration of both internal and external factors affecting the AGD; • consideration of previous internal and external audit findings; • consideration of all of these elements which will inform Public Sector Internal Audit Standards (PSIAS) / Global Internal Audit Standards (GIAS) in the UK Public Sector based risk assessments carried out locally by the Accountable Body and Partner Authorities; and • any relevant items subsequently included in local Internal Audit plans approved by each partner’s audit committee in line with PSIAS/GIAS obligations will be reflected in the consolidated AGD Internal Audit Plan. 2.19 All AGD Internal Audit work will be carried out in line with the PSIAS until 31 March 2025 and GIAS from 1 April 2025 with individual Internal Audit assignment reports presented to the AEJC and AREP for noting. 2.20 The relevant annual Internal Audit Report will be submitted to both UK and Scottish Governments upon completion. The AEJC and AREP will be advised of the overall outcomes from Internal Audit work in an annual Internal Audit Report the timing of which is anticipated to align with the annual accounts timetable and will be reported to the AEJC and AREP for noting in line with PSIAS/GIAS requirements. The Annual Internal Audit Report will include a summary of AGD internal audit work in year by all partners, an annual opinion for the AGD and for further assurance will also include the authority–wide Annual Internal Audit opinions prepared by each partner. 2.21 Actions arising from Internal Audits will be followed up by the relevant Internal Audit team in line with established arrangements in that authority and these follow-up reports will be presented to the AEJC and AREP for noting. 2.22 Further audit, advisory consultancy or investigative work may be requested by the PMO, AEJC and AREP. In most cases the PMO and its placement in the Accountable Body will play a leading role in managing requirements for additional support. 2.23 The Accountable Body’s Chief Auditor will liaise with partner Chief Auditors through established arrangements.
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Appendix 2 AGD CONSOLIDATED INTERNAL AUDIT ANNUAL PLAN 2026/27 Source: Council Internal Audit plans Anticipated Assignments Indicative Days East Ayrshire 4 June 2026 Ayrshire Growth Deal – Review of implementation of previous recommendations AGD – Benchmarking to Audit Scotland recommendations for City and Region Growth Deals – Follow-Up 11 4 North Ayrshire 12 March 2026 Review of programme governance and reporting. 20 South Ayrshire 25 March 2026 To obtain assurance that there are adequate arrangements in place to authorise and monitor AGD expenditure and that expenditure incurred is in line with the areas outlined in the Full Business Case. 15 Total 50 END