Appendix C(1)
Abridged Management Summaries in respect of Completed Audit Assignments
Report No. NN/11/07 – Final Report issued 13 April 2011
Audit Report on Council Tax and NNDR
Audit Opinion
Adequate Assurance given
Rationale Supporting Award of Opinion
The audit work carried out by Internal Audit indicated that:
•
While there is a basically sound system of internal control, there are weaknesses,
which put some of the client’s objectives at risk.
•
There is evidence that the level of non-compliance with some of the control
processes may put some of the client’s objectives at risk.
•
The assurance level is based on having made three low priority
recommendations and with one low priority recommendation from the previous
review still to be fully implemented.
•
This system was previously audited in March 2009 and was awarded an
Adequate Assurance rating based on having raised one high, two medium and
four low priority recommendations.
•
Whilst there is evidence of improvement since the previous review, the direction
of travel indicator remains unchanged.
Summary of Findings
Valuation and Billing Records
Policies and procedures are held and updated on the ACS website with dates of review
retained on the original documents.
Responsibility for maintaining the Council Tax and NNDR systems is assigned and
documented.
Records of chargeable dwellings are maintained and checked to the Valuation Office (VO)
lists on a weekly basis with regular reconciliations to VO records. The VO is promptly notified
of any properties not recorded on their lists.
The Council Tax Base is established and the calculations are checked and evidenced and the
NNDR rates have been correctly applied. Systems access is restricted to prevent
unauthorised access, although one low priority recommendation made in the previous review
on the completion of declarations of interests and ad hoc checking of systems access has not
been fully implemented. Progress with this will continue to be monitored through our sixmonthly follow up checks.
Billing
A timetable has been established and complied with for completing the annual billing process.
A reconciliation was completed before the issue of bills to confirm that the total debit set up on
the system against each band was correct.
Parameters were updated and independently checked following setting of the annual charges.
The system automatically calculates the Council Tax and NNDR liability from the parameters
input.
Accounts amended subsequent to the annual billing process have been adjusted promptly.
Collection of Income
All available payment methods are published on the Council’s website and are detailed on
individual bills. The Council also participates in initiatives to promote payment by Direct
Debit.
Income is posted and reconciled daily, and collection rates are monitored against targets on a
monthly basis.
Credit balances for Council Tax accounts and NNDR are checked and investigated on a
regular basis.
Credit balances for NNDR accounts, including those having undergone changes to the
thresholds for Small Business Rate Relief (SBRR) introduced from 30th September 2010, are
subject to review. Refunds are issued upon written request from the charge payer or will be
deducted automatically from charge payer’s bills for 2011/12 where a written request for a
refund is not received.
Suspense Accounts
There is no formal guidance on administering the Council Tax Suspense Account, including
how to resolve long standing difficult to clear items. The suspense account is reviewed on a
daily basis although included an aged debt of £63.00 from the previous year which had not
been cleared. However, subsequent to the completion of the review, management confirmed
that this has now been cleared.
Reconciliation to the General Ledger
The annual billing runs are reconciled to the General Ledger as part of the year end process.
Billing records are reconciled to the control account on a monthly basis and are subject to
independent review.
Refunds and Transfers
Refunds are authorised and checked prior to being issued and are subject to reconciliation
against the billing records on a weekly basis. However, not all reconciliations are
countersigned by an independent officer. Management agreed to implement controls
forthwith to address this issue. Transfers are only made between charge payer’s accounts in
appropriate circumstances, e.g. where they own more than one house or move within the
district, with adequate audit trail maintained.
Discounts, Exemptions and Reliefs
All discounts, exemptions and reliefs are supported with documentary evidence. However
they are not subject to independent review or routine sample checking unless they are
processed by new members of staff in which case all their processing is subject to 100%
checking until such time as they are deemed fully competent in discharging their duties. The
identification of errors is reliant on ‘self policing’ of accounts by revenues staff when/if the
account is accessed for any reason in the future and an issue noted. They are though subject
to annual review.
Monitoring is undertaken to identify re-occupation of empty dwellings and records are
promptly updated.
Arrears Recovery
The arrears recovery process is documented and followed by the Recovery Team when
chasing debts and this can be evidenced through review of cases on the system. This
includes review of suppressions placed on recovery action to prevent them being left at this
stage indefinitely without regular review.
Write-Offs
Justification for write offs is formally documented. All write offs are correctly processed on the
system, are and subject to formal authorisation and are reconciled accordingly.
Performance Information
The Council is no longer required to report against National Indicators for Council Tax and
NNDR, however still use the proportion of Council Tax and NNDR collected as a key monitor
of service performance. Data in respect of performance is produced and reported to senior
management and members on a timely basis through TEN. Robust data collection
arrangements were observed.
Risk Management
The Council Tax and NNDR teams fall under Revenue Services who have a list of generic
risks recorded on the TEN system and these are monitored and reviewed twice yearly. A
more in-depth review of the Council’s risk arrangements has been reported in a separate
audit NN1111 – draft report issued March 2011.
The following number of recommendations has been raised:
Adequacy
and
Effectiveness
Assessments
Area of Scope
Adequacy
of
Controls
Effectiveness
of Controls
Valuation and
Billing Records
Billing
Collection Of
Income
Suspense
Accounts
Reconciliation
to the General
Ledger
Refunds and
Transfers
Discounts,
Exemptions
and Reliefs
Arrears
Recovery
Write Offs
IT Security
Performance
Information
Risk
Management
Green
Green
High
0
Medium
0
Low
0
Green
Green
Green
Green
0
0
0
0
0
0
Green
Amber
0
0
1
Green
Green
0
0
1
Green
Amber
0
0
0
Green
Amber
0
0
1
Green
Green
0
0
0
Green
Green
Green
Green
Green
Green
0
0
0
0
0
0
0
0
0
Green
Green
0
0
0
0
0
3
Total
Recommendations
Raised
High Priority Recommendations
No high priority recommendations have been raised as a result of this audit
Management Responses
Management have disputed one of the recommendations raised:
Recommendation 3: Discounts and Exemptions
In order to enhance existing controls, Council Tax discounts and exemptions should be
subject to independent sample checking to ensure that they have been awarded correctly.
Rationale Supporting Recommendation 3:
Independent checking of discounts and exemptions provides greater assurance that they are
legitimate and have been correctly applied.
Adequate audit trail exists to determine the reason for awarding Council Tax discounts and
exemptions. However, there is no formal independent sample checking to ensure discounts
and exemptions have been correctly applied other than and annual review and reliance on
staff ‘self policing’ each other’s work; effectively when accessing charge payer’s accounts
only if issues with a particular account arises, but not as a matter of course if there is no other
reason to access that account.
There is an increased risk that inappropriate discounts or exemptions may be awarded which
remain unnoticed until at least the annual review process, leading to unnecessary debts
arising which then have to be recovered.
Management Response:
Disagreed – All discounts and exemptions are reviewed on an annual basis. Work is allocated
to team members on an ad hoc basis coupled with the self policing and Quality Assurance
processes management feel there are sufficient safeguards in place to mitigate this risk. I am
unaware that any cases were identified within the audit testing that illustrated the contrary
Audit Comment:
We acknowledge management’s response however the quality assurance procedure referred
to above is only effective if there is reason to access an account. Sample checking as part of
the quality process and evidence thereof would improve control. In the meantime, the
associated risks referred to above still remain.
Appendix C(2)
Report No NN/11/09 – Final Report Issued 20 April 2011
Audit Report on Housing and Council Tax Benefits
Audit Opinion
Adequate assurance given
Rationale supporting award of opinion
The audit work carried out by Internal Audit indicated that:
•
While there is a basically sound system of internal control, there are weaknesses,
which put some of the client’s objectives at risk.
•
There is evidence that the level of non-compliance with some of the control
processes may put some of the client’s objectives at risk.
•
The level of assurance is based on our having made one medium and two low
priority recommendations with two of the previous report’s recommendations,
both medium priority, remaining outstanding. Both previous recommendations
are being monitored through Internal Audit’s cyclical follow up arrangements and
therefore are not restated in this report.
•
The previous Audit completed in February 2010 was awarded Adequate
Assurance, meaning the direction of travel remains unchanged.
Summary of Findings
Policies, Procedures and Legislation
Policies and procedures are in place for HB and CTB. DWP Circulars are disseminated to
staff and included in weekly team briefings to keep staff informed.
A service plan is in place, which details the aims and objectives of the department. Managers
and Supervisors actively help and monitor their staff.
Interventions
Claimants are reminded of their responsibility to notify the Council of a change in
circumstances when they initially apply for benefit and when correspondence is received. A
specialised visiting team is in place and they follow a set procedure.
Receipt of Applications
Civica is not currently set up to prevent future processing of claims beyond the statutory
timescales.
Controls are in place over the receipt of applications. Post is received in a secure
environment and valuables are recorded and returned in a controlled manner. Consistent
practices are in place for date stamping and verification of documents.
Valuable items are no longer returned by recorded delivery, in an attempt to reduce the cost
of posting. The Council has explained that they have had no issues with regards to their
postal service and that all post is picked up directly from the Council daily.
Assessment of Applications
Applications are assessed in a timely manner by Benefits Assessors. Evidence is received to
support each application.
Calculation of benefit is automatically undertaken within the system. System controls are in
place to prevent duplicate applications being entered or processed. All evidence and case
notes are held within the system and are promptly updated. Quality checks are undertaken
on 4% of all the applications or 100% for new starters; this is carried out by a dedicated
Quality Assurance Team on a daily basis and the results are collated to be reported to the
Benefits Manager weekly.
Backdated Claims
Controls are in place for processing backdated claims, which are awarded in accordance with
legislation. Good cause is maintained in the assessment of backdated claims, with support
being available to aid assessors. Evidence is maintained by the Council within the document
imaging system to support each backdate.
Discretionary Payments (DHP)
Applications are required to be submitted in writing and correspondence is issued in a timely
manner following the award. Documentary evidence is retained for each award. All awards
checked were appropriately authorised.
Payments Process
Payment of benefit is primarily undertaken through BACS transfer, with a few cheque
payments being made. Claimants are actively encouraged to receive payment by BACS.
The BACS payment run is monitored and appropriately authorised.
Where cheques are issued, they are securely issued and monitored.
There is no regular reconciliation between the Benefits system and the General Ledger, an
issue which was raised in the previous audit report, and has also been highlighted by the
Council’s external auditors. This is due to limitations within the system with which to facilitate
the reconciliation process. Progress with implementing the previous recommendation is
being monitored through our cyclical follow up arrangements on monitoring progress with
outstanding recommendations and therefore no further recommendation has been raised.
Updating Council Tax
The Council Tax system is updated automatically when each claim is being processed or
updated; reconciliation between the benefit system and council tax occurs weekly.
Suspense Account
The suspense account between the Council Tax and Benefits system is checked and cleared
on a daily basis.
Overpayments, Arrears, Write-offs
Overpayments are classified by Benefits staff and a judgement is made regarding their
potential for recovery and the means with which to recover the debt. Invoices are created
within the Sundry Debtors system and correspondence is sent out in a timely manner.
Access is restricted to the Debt Management System.
Recovery of overpayments is made according to an automatic timetable within the Sundry
Debtors system. Where action is taken, the Council monitors performance, including cases
which have been referred to recovery agencies (Rossendales, Phoenix) or Legal Services. A
Service Level Agreement (SLA) is now in place between the Council and Phoenix. However,
the SLA between the Council and Rossendales has not been signed, as per an agreed
recommendation in the previous audit report. Progress with implementing the previous
recommendation is being monitored through our cyclical follow up arrangements to monitor
progress with outstanding recommendations and therefore no further recommendation has
been raised. While this is being completed, Rossendales are not being sent any new cases.
Write-offs are processed following set criteria, and require appropriate authorisation. All write
offs are reconciled monthly.
When write offs are reconciled to the general ledger the authorisation of individual write offs is
checked as appropriate, however this is not evidenced on either the reconciliation or the
individual write offs.
Fraud
Fraud referrals are made wherever fraud is suspected by staff. The public is also encouraged
to report suspected fraud to the Council through display of the benefit fraud hotline number
located on the Council’s website and within the Benefit Reception. Risk analyses are
undertaken for all referrals. Staff have been trained for fraud investigation and abide by
PACE and a defined Council code of conduct.
Appeals
Controls regarding appeals were seen to be in place. Although decisions were in some cases
seen to take over the targeted 28 days, valid reasons were noted in most cases, although one
case was found to have taken six months to process without a justified reason other than
shortage of staff within the department. The result of the appeal was in favour of the
claimant, resulting in a backdated claim being processed.
Security
System controls are in place regarding access to the Housing Benefits system. Access within
Comino is determined by user groups that link to respective network logins. Access rights are
reviewed on an annual basis. Systems are backed-up on a daily basis. A Business
Continuity Plan is in place. Declaration of interest forms are completed on an annual basis,
where a member of staff has declared an interest then they are restricted from working on
cases of members of the public with whom they have personal relationships.
Performance Information
The Council has set appropriate national and local indicators and monitors against both
accordingly via TEN. Data collection arrangements exist and outcomes are used for informed
decision making where appropriate. Performance is reported on a regular basis to
management.
Risk Management
There are seven risks relating to Benefits within the Corporate Risk Register. The register is
monitored twice a year. Risks are all recorded on the TEN systems with mitigation in place
for all the specified risks.
Follow Up
It was confirmed through the testing of the above areas in relation to the previous audit
completed that all but two recommendations have been implemented. The outstanding
recommendations are covered above.
The following number of recommendations have been raised:
Adequacy and
Effectiveness
Assessments
Area of Scope
Policy, Procedures
and Legislation
Interventions
Receipt of
Applications
Assessment of
applications
Backdated Claims
Discretionary
Payments
Payments
Processing, and
CTAX updates
Adequacy
of
Controls
Effectiveness
of Controls
Green
Green
High
0
Medium
0
Low
0
Green
Amber
Green
Amber
0
0
0
0
0
1
Green
Green
0
0
0
Green
Green
Green
Green
0
0
0
0
0
0
Green
*Amber
0
1
0
Recommendations Raised
Suspense Accounts
Overpayments,
Arrears and WriteOffs
Fraud
Appeals
Security
Performance
Information
Risk Management
Green
Green
Green
*Amber
0
0
0
0
0
1
Green
Green
Green
Green
Green
Amber
Green
Green
0
0
0
0
0
1
0
0
0
0
0
0
Green
Green
0
0
0
1
0
2
Total
* Relate to previous recommendations that remain outstanding which are being monitored
through the follow arrangements
High Priority Recommendations
We have not raised any high priority recommendations as a result of this audit
Management Responses
Management have accepted all recommendations raised.
Appendix C(3)
Report No. NN/11/10 – Final Report issued 5 April 2011
Audit Report on Waste Management
Audit Opinion
Adequate Assurance given
Rationale supporting award of Opinion
The audit work carried out by Internal Audit indicated that:
•
While there is a basically sound system of internal control, there are weaknesses,
which put some of the client’s objectives at risk.
•
There is evidence that the level of non-compliance with some of the control
processes may put some of the client’s objectives at risk.
•
This opinion results from the fact that we have raised one medium priority
recommendation, and there are two recommendations outstanding from the
previous report.
•
This system was previously audited by Deloitte (NN09/05) with the focus on the
existing Waste Management contract. The final report was issued in February
2009 and was awarded a Limited Assurance; therefore, the direction of travel
shows an improvement since the previous review.
•
This area will be revisited as part of the 2011/12 audit plan in order to assess the
controls in place in respect of the bedding in of the new Waste Management
contract.
Summary of Findings
Existing Contract
Controls are in place for the existing contract to ensure continuation of service and
performance up until the contract handover date of 2nd April 2011.
Contract variations occur for amendments to the service. These are authorised and agreed
between the Council and the contractor. We found instances where there was insufficient
segregation of duties between calculating and authorising service variations and where
variations had been authorised by an officer who did not have delegated authority to do so.
None of the variations were to the detriment of the Council.
Meetings between the contractor and the Council only occur as and when issues arise. We
noted that there were relatively few service or performance issues arising. Evidence was
provided to display service issues that are notified to the contractor where applicable and are
promptly resolved.
Controls relating to performance monitoring were found to be effective with monitoring
occurring in respect of street cleansing, rural and urban litterbins, public conveniences and
missed bin collections. Provision is included within the new contract for regular meetings and
performance reviews.
Contract Handover
Controls have been put in place to ensure that the contract handover period is successful with
limited disruption to service provision.
Mobilisation plans have been put in place including a timetable and risk and issue registers.
These are discussed within the weekly meetings with the new contractor.
Responsibility over the transfer of staff under TUPE rests with Kier within the terms and
conditions of the contract award. This transfer is currently in progress. There is no liability to
the Council in this respect.
Plans have been put in place for the transfer of assets from the outgoing contractor.
Clarification over the transfer of two DEFRA funded vehicles has been obtained from the
outgoing contractor to ensure that the transfer occurs.
Plans are in place to notify residents of changes to the service and any potential disruptions.
A press release was issued at the time of the contract award. Deadlines have also been set
for the issue of further notifications to residents over changes to the service.
New Contract
The new Waste Management contract was procured through a joint exercise with Kings Lynn
and West Norfolk Borough Council. Its procurement process was project-based under the
PRINCE framework and included the formulation of a Procurement Board comprising North
Norfolk District Council and Kings Lynn and West Norfolk Borough Council representatives.
The Council adopted the process of competitive dialogue within its discussions with tendering
organisations.
The selection of the tender was based upon a model developed by the Council’s advisors,
Gordon Mackie Associates Ltd. Selection was based upon 50% qualitative evaluation and
50% financial evaluation. Evidence of selection scores confirmed that Kier Street Services
Ltd represented the most financially advantageous option and provided the best option with
regard to qualitative factors according to the evaluation process.
Evidence of the procurement process has been retained by the Council. Through retaining
documentation for the process, the Council reduces the risk of successful challenge by a
losing bidder. This process complied with EU Remedies Directive legislation requiring the
authority to notify unsuccessful bidders of the outcome of their tender.
Minor decisions or negotiations, which may affect the terms and conditions of the contract,
undergo approval by both North Norfolk District Council and the contractor.
There is provision in the 2011/12 audit plan for further review on the new contract
arrangements.
Performance Information
Key Performance Indicators have been agreed between North Norfolk District Council and the
contractor.
Performance monitoring arrangements have not been finalised. The contractor will monitor its
own performance and report on targets to the Council as well as the Council undertaking
performance monitoring of the contractor. The Council is planning to ensure that its
monitoring arrangements avoid any duplication of work with the contractor’s self-monitoring
arrangements. Exact details of the Council’s intended monitoring arrangements have yet to
be finalised however, monitoring has been considered and included within action plans. This
will be evaluated in more detail as part of the intended scope of audit coverage included in the
2011/12 audit plan.
Risk Management
Risks have been identified within the Council’s Corporate Risk Register over the procurement
of the new Waste Management contract. Risks have also been identified at service level
regarding the procurement of the Waste Management contract and the mobilisation/contract
handover period. Mitigation or action plans have been set and are monitored.
Previous Recommendations
Two of the previous reports recommendations remain outstanding; one regarding the
introduction of a contract monitoring manual and one in relation to the payment mechanism.
Both recommendations have revised implementation dates of 1st April 2011. However, since
they relate to the existing contract they will be superseded once the new contract
commences. This will be confirmed as part of the next round of cyclical follow up checks due
in April 2011, and compliance with these aspects under the new contract will be considered
as part of the 2011/12 review.
The following number of recommendations has been raised:
Adequacy
and
Effectiveness
Assessments
Area of
Scope
Adequacy
of
Controls
Effectiveness
of Controls
Existing
Contract
Contract
Handover
New
Contract
Performance
Information
Risk
Management
Green
Amber
High
0
Medium
1
Low
0
Green
Green
0
0
0
Green
Green
0
0
0
Green
Green
0
0
0
Green
Green
0
0
0
0
1
0
Total
Recommendations Raised
High Priority Recommendations
We have not raised any high priority recommendations as a result of this audit
Management Responses
Management have accepted the one recommendation raised.
Appendix C(4)
Audit No. NN/11/11 – Final Report issued 13 April 2011
Audit Report on Corporate Governance and Risk Management
Audit Opinion
Adequate assurance given
Rationale supporting award of opinion
The audit work carried out by Internal Audit indicated that:
•
While there is a basically sound system of internal control, there are weaknesses,
which put some of the client’s objectives at risk.
•
There is evidence that the level of non-compliance with some of the control
processes may put some of the client’s objectives at risk.
•
This opinion results from one medium and two low priority recommendations
having been raised and one further medium priority recommendation from the
previous audit, which remains outstanding.
Summary of Findings
Local Code of Governance
The Council’s Local Code of Governance was approved by Full Council in 2008. It has since
been reviewed, with the most recent changes having been approved by Full Council in June
2010.
The Code is available to all stakeholders via the Council’s website.
Supporting evidence is maintained and referenced in the Local Code to demonstrate
compliance with the CIPFA/ SOLACE “Delivering Good Governance in Local Government”
publication.
An action plan is in place to monitor areas where scope for improvement has been identified.
Progress with the action plan is monitored by the Performance and Risk Management Board.
Most actions had been completed, although several had been marked as ‘on track’ with one
recorded as ‘some problems’. Whilst it was confirmed that action was being taken in respect
of this issue, the plan had not been updated to reflect this. We were informed that it was due
to be updated prior to the next Performance and Risk Management Board meeting scheduled
for later in March 2011.
Governance - Focusing on the purpose of the authority and on outcomes for the
community and creating and implementing a vision for the local area
Steps are being taken to prioritise services following the Government’s spending review in
October 2010, and staff and the local community have been formally consulted. Financial
forecasting has been undertaken based on the information provided through the review and
has been subject to scrutiny by Full Council. Evidence was obtained to demonstrate
compliance with the relevant principles of the CIPFA/SOLACE guidance with respect to
maintaining quality levels of service delivery and value for money.
The Council’s vision is documented in the Corporate Plan, which is currently in the process of
redrafting.
Risk Management
The Risk Management Framework was revised and approved by the Performance and Risk
Management Board in November 2010 and the Audit Committee in December 2010. The
revised version is pending Full Council approval.
The revised version incorporates the elements recommended during the previous audit
(NN1014 – Corporate Governance and Risk Management, Recommendation 4).
Risk assessments are undertaken for service areas as part of service planning and are
submitted to the Corporate Risk Officer. Three services had not submitted their risk
assessments and they were not therefore appearing on the performance monitoring system
(TEN). The requirement to place copies of the risk assessments on TEN was raised in the
previous audit report and accepted by management. This had been marked as having been
‘implemented’ but has been reinstated as a consequence of our observations. Progress will
be followed up as part of our six monthly follow up checks.
The Council intends to introduce mid-year reviews of service level risks and associated
mitigation plans. Whilst some service areas had updated their risks in TEN at the mid-year
point in 2010/11, the majority had not.
Whilst risk owners have been clearly defined for corporate risks, it was not clear from
inspection of TEN as to who was responsible for individual service risks. Corporate risks are
monitored through the Performance and Risk Management Board and the reporting structure
enables service level risks to be escalated to the Corporate Risk Register where appropriate.
Corporate accountability training has been provided to the Corporate Management Team
(CMT), which included elements of risk management.
Training has also been provided to operational level staff and whilst this was primarily from a
health and safety perspective, the principles remain the same and so no recommendation has
been raised in respect of training needs.
An e-learning package is being developed by Human Resources, which will incorporate
further elements of risk awareness.
The following number of recommendations has been raised:
Adequacy
and
Effectiveness
Assessments
Area of
Scope
Adequacy
of
Controls
Effectiveness
of Controls
Local Code
of
Governance
Focus, Vision
& Community
Risk
Management
Green
Amber
High
0
Medium
0
Low
1
Green
Green
0
0
0
Green
Amber
0
1
1
0
1
2
Total
Recommendations
Raised
High Priority Recommendations
We have not raised any high priority recommendations as a result of this audit
Management Responses
Management have accepted all recommendations raised.
Appendix C(5)
Report No. NN/11/12 – Final Report issued 18 May 2011
Audit Report on Planning and Development Control
Audit Opinion
Adequate Assurance given
Rationale Supporting Award of Opinion
The audit work carried out by Internal Audit indicated that:
•
While there is a basically sound system of internal control, there are weaknesses,
which put some of the client’s objectives at risk.
•
There is evidence that the level of non-compliance with some of the control
processes may put some of the client’s objectives at risk.
•
This opinion results from having the fact that we have raised five medium and six
low priority recommendations over a wide scope.
Summary of Findings
Planning Applications
Although process maps have been developed for the application process, other procedural
guidance, in particular on administering planning applications, including pre-application
enquiries and planning enforcement actions need evidence of review to confirm they reflect
current practices.
Checklists are in place to help to ensure that correct actions are taken and all required
documentation has been received. The ‘National Requirements’ checklist form for confirming
receipt of full supporting documentation pertaining to a planning application was not always
being completed (although the supporting information for this checklist was available). We
noted one case where a press advertisement had not been retained, although consider this
isolated.
The Council monitors against the target NI195 relating to the processing of applications. We
confirmed that processing had occurred in a timely manner in compliance with these
performance requirements.
Applications are received either through receipt of a hardcopy application form or an online
application through the online national Planning Portal.
It was found that decisions are publicly displayed, including how they comply with local
policies and legislative requirements. In all cases tested, a decision notice was held on file.
We confirmed that appropriate fees had been received for our sample. A reconciliation of
income received by the service back to the General Ledger does not take place.
Planning Enforcement
We confirmed that correct procedures are followed for enforcing planning activity. However, it
was evident that issues with the timeliness of action being taken on enforcement cases exist
in that delays are occurring in progressing individual cases, which has caused a backlog to
occur. This issue was highlighted to the Development Control Committee on 17 February
2011. The Council is in the process of re-drafting the enforcement policy.
Enforcement Officers utilise the ‘Bring Forward’ function within the Plantech ACOLAID system
to keep track of enforcement cases. The effective operation of this control is dependent upon
officers utilising the function at all times. At present, there are no one-to-one meetings to
discuss cases and caseloads. Furthermore, there is no documented schedule of enforcement
cases in order to keep track of actions to be taken, aside from individual system records.
Section 106 Planning Agreements
Section 106 Planning Agreements were found to be drawn up following consultation with
relevant parties and appropriately approved at a senior level. We confirmed that departments
are being consulted over Section 106 Planning Agreements.
The Planning Legal Officer determines the legal fees for the period, although he does not
keep a documented record of fees charged and time taken in drawing up the agreements
which makes up the fees charged. The fees charged by North Norfolk District Council are
relatively low compared to other local districts.
From a sample of five cases where trigger points had been met, it was clear that monitoring of
the agreements is inconsistent . Included within this sample was one agreement where a
requirement had been made and no responsibilities had been defined. As such, no action
had been taken by officers and its status was not being monitored.
Building Control
Procedures for building control functions are in place, although there is no evidence to
confirm when they were last reviewed / updated or who by. The procedure note ‘BCPN-7
Registering Applications’ relating to registering applications, was found to be incomplete.
Staff are aware of the requirement to declare interests in potential applications through terms
of the Employee Code of Conduct.
Building Control applications are processed in a timely manner. Pre application enquiries are
made to the Council. The service conducts site inspections prior to an application being
made although does not charge for this service or monitors to make sure all pre application
enquiries result in a formal application being received. However, as a consequence of this
observation, management undertook an exercise to look in to this and as such, no
recommendation has been made.
Completion certificates are issued to applicants following a final site inspection. However,
certificates have not been issued to the Fire Service in cases where they have been
consulted. An email reminder has now been issued by the Building Control Manager to
remind staff of this requirement.
The Council published an approved charging scheme effective from 1st October 2010 in line
with the revised Building Regulations 2010. Testing confirmed that during 2010/11 the
amounts charged were in line with the relevant charging scheme, including those applicable
since April 2010 when the previous charging scheme was in place.
Income has been received for processing of applications by the service and for inspections.
Invoices are produced on a timely basis when work is commenced and recovery action has
been undertaken by the Council’s Sundry Debtors team.
No formal monthly reconciliations are completed between income received by Building
Control to income in the General Ledger. We identified that a reconciliation had been
undertaken for December 2010, although prior to this only a single reconciliation had been
undertaken for the period between April 2010 and November 2010.
Land Charges
Both additions and deletions to the register are made through request by individual
departments to the Land Charges service. Delays were noted in informing the land charges
team of requests to make a charge, and delays in the land charges team registering the
charge.
There is also no independent verification that deletion of charges are legitimate, although
limited user access rights to amend data helps mitigate the risk of unauthorised deletions
occurring.
Testing was undertaken to ascertain if notification of Land Charges to the service is
embedded within procedures. Of the three services selected, it was found that notification
had been accounted for within procedures for two of the services.
Evidence of the reconciliation of income was not consistently retained, in particular for May
2010 or July 2010.
Performance Information
One national indicator is in place for the service; NI195 which relates to the length of time to
process applications. Local indicators have also been put in place for the service, including
targets for the number of appeals whose decision has gone in favour of the Council, the
number of applications decided through delegated authority and the amount of income
received by the Building Control service.
Performance is reported to management and members through the TEN Performance
Management System. It is noted that, for the current year, performance has varied within the
service. The Council has been below target against its agreed target for the NI195, although
has performed above target with regard to income received by the Building Control service.
Performance against NI195 during quarter three 2010/11 has been affected by the
restructuring within the Development Control service which took place in October 2010.
Continued monitoring of performance against the target will be undertaken with consideration
taken to ensure that targets are reflective of the service in its current state.
Risk Management
Risks have been identified at a corporate and service level. Risks within the Corporate Risk
Register were found to have been reviewed with mitigation plans in place. Risks are present
within service plans at a service level.
The following number of recommendations has been raised:
Adequacy
and
Effectiveness
Assessments
Area of
Scope
Adequacy
of
Controls
Effectiveness
of Controls
Planning
Applications
Planning
Enforcement
Section 106
Agreements
Building
Control
Land Charges
Performance
Information
Risk
Management
Green
Amber
High
0
Medium
0
Low
3
Green
Amber
0
1
0
Green
Amber
0
2
0
Green
Amber
0
1
1
Amber
Green
Amber
Green
0
0
1
0
2
0
Green
Green
0
0
0
0
5
6
Total
Recommendations Raised*
High Priority Recommendations
We have not raised any high priority recommendations as a result of this audit
Management Responses
Management have agreed all recommendations raised.
Appendix C(6)
Audit No. NN/11/13 – Final Report issued 28 April 2011
Audit Report to support the preparation of the Annual Governance Statement
As this audit focuses on key controls operating over fundamental financial systems, and does
not review these systems in entirety, no audit opinion is provided.
Summary of Findings
Key Controls Testing
There are a number of key controls within the material systems that are required to be
covered as a minimum during each financial year. A number of these material systems have
been subject to audit during the period and reported on in detail and those key controls have
been addressed in each system reviewed and have been followed up, where applicable. We
have also reviewed controls in the material systems that were not covered as part of the
agreed 2010/11 Annual Audit Plan.
Key controls were found to be operating in most areas reviewed. Where weaknesses were
noted to key controls covered through systems reviews during 2010/11, cross-reference has
been made to the recommendations contained in those reports as appropriate.
Due to the infrequent nature of capital transaction activity, management has previously stated
that they will reconcile the asset register to the general ledger only on an annual basis. We
confirmed that updates and reconciliations of the fixed asset register are scheduled for April
2011 as part of the year-end financial close down process, although had not commenced at
the time of our audit work. We have not sought to raise a recommendation regarding the
occurrence or frequency of this reconciliation due to management’s previous response.
In accordance with the Accountancy Procedures, journal transfers are only required to be
formally authorised where their value is over £100,000. This gives rise to a potential
weakness over the accuracy and validity of journals made below this limit. This issue has
been raised previously, including by the Council’s External Auditors in their report on their
review of Internal Financial Controls 2009/10, published in September 2010.
The
recommendation made by the External Auditors to improve controls for authorising journals
below £100,000 was not accepted by the Financial Services Manager with mitigating reasons,
so is not restated here. Details of the mitigating controls as advised by the Financial Services
Manager for not routinely approving journals below £100,000 are referred to in our testing.
We found that monthly reconciliations between the Payroll control account and the general
ledger were being completed. However, there was no evidence of independent review.
Review of access rights to the general ledger indicated that an annual review is yet to take
place; work is underway to ensure this is undertaken in May 2011, and as such no
recommendation has been raised.
The general ledger suspense account is reviewed on a daily basis and cleared when
possible. We identified that the Suspense Account contained a balance of £8,752.82, which
had included items brought forward from the previous year.
A medium priority
recommendation (No 2) was made in the previous review of Accountancy Services – NN1008
issued in January 2010. This recommendation was deemed to have been implemented
following follow up checks on 12th April 2011, on the basis that it had been included in the
‘Closure of Accounts Timetable 2010/11’ with action to clear the suspense account by 24th
April 2011 - Item number 87 – ‘Confirm balances on all suspense and holding accounts reallocate where applicable’.
A further recommendation made in the NN/10/09 Housing Benefit and Council Tax Benefit
Audit remains outstanding and has been referred to again in the final report on Housing and
Council Tax Benefit issued on 20th April 2011. It relates to the need to reconcile the Housing
Benefit system to the General Ledger. Progress with the initial recommendation continues to
be monitored through our cyclical follow up checks on the status of outstanding
recommendations; management have stated that they intend to resolve this when
implementing a new housing benefit system.
Assurance Statement and AGS statement Process and Review
The assurance statements were sent by the Corporate Risk Officer in February 2011 for
return by the end of April 2011 prior to the creation of the AGS statement. However, the
Corporate Risk Officer has left the Council since the fieldwork was completed and
arrangements to cover this role have yet to be determined. The Financial Services Manager
is collating the manager responses.
No high priority recommendations have been raised as a result of this audit, and management
accepted the one recommendation raised regarding review of payroll reconciliations.