Internal Audit annual report 2006/7

Report: 8
Date: 15 June 2007
By: Chief Executive

Summary

The report at Appendix 1 summarises the work of Internal Audit for the year 2006/7, gives the opinion of the Director of Internal Audit on the adequacy and effectiveness of control within the MPS, which is that this continues to fall below an acceptable standard. The report also comments on the effectiveness of MPA Internal Audit to meet the requirements of the Accounts and Audit Regulations 2003 (as amended 2006).

A. Recommendation

That

1. the Corporate Governance Committee approves the attached draft Annual Report of the Director of Internal Audit for circulation to all members of the Authority; and
2. confirms that MPA Internal Audit provided an effective audit service to the Authority in 2006/7.

B. Supporting information

1. The report sets out the Director of Internal Audit’s opinion on the adequacy of the control environment, including governance, risk management and internal control within the MPS and MPA for the reporting period. The report also includes, at Annex A, summaries of each audit completed with an update from senior line management commenting on the summary and indicating progress in implementing the recommendations, follow-up reviews and summaries of key areas of audit advice. Annex B to the Report gives a brief summary of investigations undertaken during the year.

2. At the Corporate Governance Committee in September 2006 the Director of Internal Audit presented a paper on how best to measure the effectiveness of Internal Audit to meet the requirements of the Accounts and Audit Regulations 2003 as amended in 2006. The Committee agreed that performance measures included in the Director of Internal Audit’s Annual Report together with any relevant opinion from the Commissioner and the Audit Commission, supplemented with the Chief Executive’s Opinion, would form the basis of the assessment of Internal Audit’s effectiveness. Internal Audit Performance against its key targets is summarised in the key points that follow. In addition, the Director of Internal Audit commissioned an independent review against the CIPFA Code of Practice, initial conclusions of which show that MPA Internal Audit comply with the required standards. The Chief Executive confirms that she is satisfied that the Authority had an effective system of internal audit throughout 2006/7.

3. Key points to note from the draft Annual Report include:

• The Director of Internal Audit concludes that the adequacy and effectiveness of internal control in the MPS continues to fall below an acceptable standard. Generally Internal Audit has found adequate and effective operating procedures within the MPS but in practice key controls have not been applied, applied inappropriately or not applied in time.
• The control environment is improving in a number of areas. In particular, around corporate oversight with the establishment of the Investment Board and Assessment Panel, Value for Money Programme Board, Intelligence, Covert Policing and Tasking Steering Group, Corporate Risk Review Group and the Productivity Strategy Group. The IS/IT, HR and Estates Oversight Groups have also improved the effectiveness of the scrutiny and monitoring role of the MPA in key business support areas.
• Internal Audit achieved completion of 85% of the planned systems audit work against a target of 90%.
• The investigative arm of internal Audit, the Forensic Audit Branch, contributed to savings or losses stemmed during the year of £7.5m and recoveries made of £4.1m.
• Internal Audit issued a significant number of B/OCU reports and is continuing to work collaboratively with B/OCU Commanders, TPHQ and Finance Services to address the issues arising.
• Internal Audit has advised on a number of significant developing systems including: Transforming HR, MetaFor and MetDuties and MetTime projects. It has also received an increased number of requests for assistance and continues to expand its advisory role.
• The Internal Audit customer satisfaction rate at 71% is slightly down from last year. The highest scores were 91% satisfaction with the way audits were conducted and 89% satisfaction for the fact that undue disturbance was avoided.
• Staff numbers employed in Internal Audit remained stable throughout the year and continue to reflect the diverse community that they serve.
• Internal Audit slightly underspent on its budget.
• MPS Management accepted all high-risk audit recommendations with the exception of one, where an alternative solution put forward by Management was agreed.
• Internal Audit has made further progress in maintaining and building ongoing working relationships with HMIC and the Audit Commission.

C. Race and equality impact

All field auditors and investigators have received appropriate training in equality and diversity issues and their performance within the MPS is monitored. Internal Audit planned work is designed to provide as wide a range of coverage of MPS staff and systems as is possible and practicable.

D. Financial implications

The cost of Internal Audit activities is met within the MPA’s directly managed budget. There is a risk of loss, fraud, waste and inefficiency if Internal Audit recommendations are not effectively implemented. Savings and recoveries made enable funds to be better directed towards core policing activities.

E. Background papers

None

F. Contact details

Report author: Catherine Crawford, MPA Chief Executive.

For information contact:

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

Send an e-mail linking to this page

Feedback