Councillors and the Independent Lay Member of the Audit Committee are set to ask questions around an audit report that has flagged up concerns over how effective Tŷ Pawb’s systems of financial control are.
The Audit Committee is able to ask questions regarding any audit that has been completed, but are guided that it may wish to focus on audits with a “Red” or “Red Amber” assurance about the level of internal control or where High Priority recommendations from earlier audits have not been
Two new audits were given a “Red” level of assurance, labelled Tŷ Pawb and “Investigation B”. There is no indication if there was an Investigation A or C, however it is stated that the “Investigation B” audit was an unplanned one.
The reports before councillors give some details to each audit. Overall it is noted “…based on the work done between February and March 2019, the Head of Service, Audit and Technical’s view is that that the Council’s control environment is largely effective” however does note ‘further work is required in the areas with a Red or Red/Amber level of assurance’.
Red levels are defined as inadequate controls, with the absence of at least one critical control mechanism, and where ‘errors and omissions have been detected’. Such problems ‘leaves the Council exposed to significant risk, which could lead to major financial loss, reputational risk of embarrassment or failure to achieve key service objectives’ and there are attempts to fix the problems via related recommendations.
Audit is looking at if ‘Tŷ Pawb’s aims and aspirations are supported by effective systems of financial control’, and effectively flagged the answer as red, summarising: “There were examples of a lack of awareness of, and compliance with, Financial Regulations and other key governance requirements which, although no significant material losses or errors were identified, represent serious weaknesses in financial control.”
As a result Tŷ Pawb has five high priority recommendations, and eight medium priority ones although not all are explained in the now public document.
Issues with Tŷ Pawb are detailed and explained via high priority recommendations set against control objectives measurements. Cash handling at Tŷ Pawb has come under the audit spotlight, with the report stating: “There is a need to further improve the effectiveness of financial controls in respect of cash income, to reduce the potential risk of fraud. It is stressed that no financial loss was identified.”
Specific to the ‘Wales in Venice 2019′ curation, “Funding bids were not managed as projects”
There is an unsurprising objective that assets owned by the Council, or for which the Council is responsible for, are adequately protected, however it is recommended that Tŷ Pawb introduce a complete inventory, as the council does not know what it has bought/owns there, “There was no complete inventory of assets which increased the risk that items could not be accounted for.”
The report states Chief Officer of the council’s Housing & Economy department has accepted the findings, and will respond with a completed Action Plan to address the high priority recommendation in due course, but no implementation date has been set.
We understand ’emergency meetings’ regarding Tŷ Pawb have taken place recently, so it is possible action is well underway, and as and when any Advisory Board minutes emerge we will link / report on them.
There is no such break down for “Investigation B”, however “Further details will be reported to a future Audit Committee meeting” and it has resulted in five high priority recommendations.
The detail of “Investigation B” is unknown however it is clear unspecified ‘concerns’ over an unknown problem have been raised. The department in the council it relates to has effectively been redacted and is not appearing in the public report, and the control objectives are also not public so no indication of the contents are known. The scale of the investigation must be substantive as audits into School Catering and Tourism have been bumped to allow staff time to focus on “Investigation B”.
The Audit Committee meet to consider the reports on Thursday, 30th May at 4.00 pm , it is possible the meeting could be webcast.
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