Agenda item

The report is intended to inform the Governance and Audit Committee of progress made against the 2024/25 internal audit plan.

The Internal Audit Progress Report was presented by the representative from BDO. The report included audits of the following areas:

-       Homelessness

-       Income Generation

-       Business Continuity and Disaster Recovery.

Homelessness

BDO concluded that the Council had a Moderate design of controls and Moderate effectiveness of controls for Temporary Accommodation Management.

The control design was Moderate because while the Council had established a system of internal controls, there were some areas requiring improvement. While BDO acknowledged some factors were influenced by national challenges, these specifically related to the following findings:

-       The Housing Strategy 2020-2024 requires review and alignment of homelessness prevention initiatives to the Corporate Plan 2024-2027

Similarly, the control effectiveness was Moderate as while there were areas of non-compliance, some challenges aligned with national trends. This opinion was principally driven by the following medium and low findings:

-       Extended stays in temporary accommodation potentially impacting stability, mental health and wellbeing of families and children though often involving complex cases requiring specific requirements and multi-agency support.

-       Need to update the procedure documents in line with the system update as well as the need to have a formalised approach for temporary accommodation provision.

During discussions about the Homelessness aspect of the audit, Members commented on the following:

-       Satisfaction that funding had been increased in the national Autumn budget for implementing homelessness services.

-       Assurance was sought that multi-partner working arrangements with other services in Lincolnshire was not duplicating work. The Housing Options Manager confirmed that careful co-ordination had ensured that the multi-agency Lincolnshire Homelessness Strategy complimented SKDC’s Homelessness Strategy. Attention was also drawn to the operational nature of the Change4Lincs initiative which covered several local authorities in Lincolnshire.

-       It was queried whether SKDC were engaging with other organisations in Grantham that were supporting individuals facing Homelessness. The Housing Options Manager confirmed this to be the case with quarterly meetings of the Homelessness Forum allowing for dialogue between SKDC and local organisations.

-       The Leader of the Council recognised the positive progress made by SKDC’s Homelessness services.

Income Generation

BDO concluded that SKDC had a Substantial design of controls and Moderate effectiveness of controls for Income Generation.

The Control design was Substantial because SKDC had established comprehensive systems of internal controls and processes for managing income generation to achieve objectives. While some documentation updates would have been beneficial, core controls were in place including:

-       Multiple marketing channels with demonstrated reach and engagement

-       Established grant funding processes with successful outcomes

-       Strong analytical capabilities of Marketing reach through platforms like Onclusive.

The control effectiveness was Moderate as there were some areas where implementation could be strengthened. This primarily relates to:

-       Variation in cost analysis in fees setting processes across services with some services

-       Lacking documented rationale to support price changes.

-       Potential to enhance revenue generation from existing marketing channels

-       Opportunity to formalise grant funding practices.

During discussions about the Income Recovery aspect of the audit, Members commented on the following:

-       Whether Officers had been trained in the fee setting process. The Section 151 Officer confirmed that the fees were set by either the heads of service or their superiors who possessed the necessary competence required. A Member requested further clarity about this as the report had implied that training and guidance was required for all staff. Upon reflection, BDO acknowledged the Section 151 Officer’s response to be in the intended spirit of their comment.

-       It was the belief of a Member that SKDC should be clearer as to where subsidies were being spent, particularly for residents in rural areas who are more isolated from the urban investments. It was suggested that this can be fed into the 2025 review. 

Business Continuity and Disaster Recovery.

BDO raised three medium priority recommendations and one low priority

recommendations to improve the Council’s control arrangements for business

continuity and disaster recovery.

BDO concluded moderate assurance for the design of the controls as there was a sound system of internal control designed to achieve system objectives with a few exceptions. This could be seen in the lack of fully defined BCPs, however BDO noted that SKDC were in the process of revising how it conducted business continuity which was expected to conclude in January 2025.

BDO concluded moderate assurance for the effectiveness of the controls as some exceptions were identified during the review. This could be seen with the service area plans not being subject to testing at the time of the review in addition to the lack of consideration in eight of the BIAs for whether BCPs were accounted for with third party service providers.

During discussions about the Business Continuity and Disaster Recovery aspect of the audit, Members commented on the following:

-       Whether Parish Council’s were encouraged to have Category Two Disaster Recovery Plan’s in place. It was confirmed that Parish Council’s were not recorded as Category One or Two respondents.

-       It was noted that a disaster recovery test had been undertaken in the week prior to the meeting with IT services dropping out. The response demonstrated the resilience of services, and the Emergency Planning and Health & Safety Lead pledged to continue tests for different service areas.

The Internal Audit Progress Report was noted.