Internal Audit progress report

Report: 8
Date: 22 September 2006
By: Director of Internal Audit

Summary

The report summarises the work of Internal Audit for the period April to September 2006.The report also summarises the results of significant Internal Audit work to date and the adequacy and effectiveness of control in MPS systems where Internal Audit has issued final reports since April 2006.

A. Recommendation

That

1. members note the progress made in achieving the 2006/07 Internal Audit Plan; and
2. the current Internal Audit evaluation of the adequacy and effectiveness of internal control in the MPS.

B. Supporting information

Progress against the 2006/07 Internal Audit Plan

1. Work is underway on 59% of the systems audit programme and we are aiming to achieve the 90% target for completion of the systems audits to report stage. We have, however, had an auditor vacancy for most of the year and an auditor has been seconded for approximately eight months to the MPA Treasury Team. These factors are impacting on our ability to deliver the plan and I will report further on progress at the next meeting.

2. We have finalised seven audits of local Borough/Operational Command Unit financial and business systems. Fieldwork is underway in Hammersmith, Bexley Heath and Kingston BOCUs and the Palace of Westminster and Royal Parks OCUs. Further audits of Islington BOCU, the Traffic Criminal Justice Unit, TPHQ and SO2 Business Support are planned for the second half of the year.

3. We are currently advising on twenty-four of the twenty-seven areas of work published in our systems development programme at the start of the year. Work is due to commence in line with the MPS programme for development for the remaining three areas.

4. Twelve final follow-up reports have been issued with a further eight having reached draft report stage and fourteen currently in progress. Twenty-two follow-ups are planned for the second half of the year. However, as a result of some delays in issuing final reports, 42% of the follow-ups in our programme are now not due until next year (the timing of the review is dependent on the date the final report is issued).

Opinion on the adequacy and effectiveness of MPS systems

5. In my Annual Report for 2005/06 I noted that, on the scale where 1=excellent control and 5=unacceptable control, the MPS had an overall score of 2.9 (3.3 for systems audits and 2.5 follow-ups). At this stage of the year for 2006/07 the equivalent score is 3.1 overall (3.6 systems audits and 2.4 follow-up).

6. Although there is a slight improvement in the follow up position, the overall score has decreased on last year. This is mainly due to the number of BOCU reports that have been finalised in the first half of the year. We have reviewed many of the BOCUs for the first time and to some extent it is to be expected that a greater number of areas for improvement will be identified. I will be meeting with Senior Managers in the MPS to discuss measures that can be taken to help improve the level of assurance that I can give at the end of year.

Current investigations

7. We have taken on 28 new cases since the 1 April 2006. This is consistent with the pattern of earlier years. Whilst the investigations are spread across business areas of the MPS a recurring feature of many of the cases is the procurement process.

8. I have previously drawn attention to a case involving the procurement of specialist equipment to support operational policing at a cost in excess of £2.7m. As the matter has now been adopted as a case by SCD6 (Public Sector Fraud Team) I am unable to provide further details at this time.

9. We have commenced an investigation into the estate procurement issues surrounding Safer Neighbourhoods. In view of the significant expenditure the Audit Commission are monitoring our work closely. The investigation is complimentary to the work the Deputy Treasurer is undertaking on the way forward.

10. We are continuing our examination of a number of IS/IT projects. A recurring feature is the lack of robustness in the procurement process. We are also contributing to an MPS Gold Group on another IT matter.

11. Work on the 2004 NFI is now concluded apart from three cases of benefit fraud by former police staff awaiting trial at the Crown Court or a decision on whether to proceed to trial by the CPS. Preparations are in hand for the 2006 exercise. The Authority is required to provided details of staff and pensioners to the Audit Commission in October 2006. A new feature of the 2006 exercise will be the matching of creditor data. This is expected to generate a considerable of volume of work due to the size of the MPS creditor database.

Current advice and review activity

12. We continue to advise on the Outsourcing Work Programme, in particular within Property Services, which is at a critical stage. We are also advising on the governance framework going forward post implementation of the new outsourced contracts. We have attended a number of workshops on MetHR looking at the integration of the HR and payroll systems and continue to advise on the upgrade of the corporate accounting system. We are also working with the MPS to ensure adequate controls are put in place to support their covert policing strategy. We are continuing to support the work the Deputy Treasurer is leading in developing new procurement frameworks and revising the MPA contract regulations.

13. I plan to hold a seminar with senior members of the MPS to discuss the current issues around procurement that are causing concern and to agree the way forward. MPS senior management has welcomed this approach.

14. We have issued the following final systems audit and follow up reports since the publication of my Annual Report:

• Systems audit reports
  • SO12 - Review of Financial Controls (C)
  • Road Accident Reports and Intelligence
  • IS Strategy and Planning
  • Imaging Services, Identification Services, DNA and Fingerprints
  • Systems Supporting National Police Performance Indicators
  • Business Continuity/Disaster Recovery
  • Systems Supporting Service-wide Priorities - Trident
  • Budget Preparation, Approval and Monitoring
  • Ealing BOCU
  • SO18 Heathrow
  • Haringey BOCU
  • Southwark BOCU
  • Newham BOCU
  • SCD7 Serious and Organised Crime
  • Tower Hamlets BOCU
• Follow up audit reports
  • Creditors Payment System
  • Uniform Services - Stores and Stock Control
  • Storage and Display of Police Artefacts
  • Interview Tapes - Retention, Storage and Disposal
  • Payroll Starters and Leavers
  • Systems Supporting Camera Partnerships
  • Accounts Control - SO/SCD (C)
  • Accounts Control – SO12 (C)
  • Hillingdon BOCU
  • Equipping and De-Equipping Vehicles
  • Barnet BOCU
  • Transport OCU

Staffing

15. I currently have thirty-six staff in post and one auditor vacancy. We are hoping to fill the vacancy in December 2006 following a recent recruitment campaign and the auditor on secondment will shortly be returning from the MPA Treasury Team. The MPA SMT have also agreed to the six month secondment of a senior lecturer from the National School of Government to MPA Internal Audit to assist in delivery of a number of high risk audits from the annual audit programme.

Liaison with MPS risk management, inspection and review activity

16. We are continuing to work in liaison with the MPS Director of Risk Management and the internal inspection review bodies. We are actively involved in the Internal Inspection and Review Group aiming to ensure internal review activity is properly co-ordinated and duplication is avoided.

External liaison

17. My Deputy represents Internal Audit on the MPS External Inspection and Review Group and we are working with the Audit Commission, HMIC and the MPS Inspectorate to ensure that a co-ordinated work programme of inspection and review activity is produced for 2007/08.

18. I regularly meet with the other heads of audit in the GLA family to discuss issues around commonality of reporting and comparing internal audit performance. We are also due to meet with a representative from the British Transport Police to advise on the further development of their internal audit unit.

C. Race and equality impact

1. Our diverse workforce sets a good example to the MPS. The MPA’s commitments in relation to equality and diversity are considered in all audits and investigations carried out by Internal Audit.

2. We monitor the behaviour of our staff through questionnaires to auditees on a range of matters related to audit and investigative fieldwork. This helps to ensure that any diversity issues are quickly identified and addressed.

D. Financial implications

We are currently forecasting a small underspend in the Internal Audit element of the MPA budget by the year end.

E. Background papers

None

F. Contact details

Report author: Peter Tickner, Director of Internal Audit, MPA

For information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

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