Directorate of Audit, Risk and Assurance (DARA) Progress Report

Report: 6
Date: 10 March 2011
By: Director of Audit, Risk and Assurance

Summary

This report summarises the work completed by the Directorate of Audit, Risk and Assurance since the Committee last met. It also provides an update on the adequacy and effectiveness of control in the MPS based on final reports issued to date.

A. Recommendation

That members note:

1. work undertaken by the Directorate of Audit, Risk and Assurance and progress made in achieving the 2010/11 Plan; and
2. the current evaluation of the adequacy and effectiveness of internal control in the MPS.

B. Supporting information

Audit Work Completed in the 4th Quarter 2010/11

1. Eleven final reports have been issued since the December meeting of the Committee. Appendix 1 highlights the overall opinion, effective areas of control, the risk and control issues identified and progress made in implementing recommendations, for each review completed. A further 30 audits are at report stage and 12 underway.

2. We have continued to provide risk and control advice to the language programme board, finance modernisation programme, covert control advisory group, asset management tracking project, and the improving policing information programme. We are also assisting in scoping the anti corruption review to be conducted by the MPA. Monthly meetings with the MPS on risk management have focused on the risk maturity assessment conducted by the Head of Risk Management which we are currently reviewing. These meetings have also been particularly productive in informing next year’s annual plan for audit activity.

3. We are conducting our follow up of security vetting and clearance. Initial findings show that progress is being made towards implementing our recommendations. The latest position on the amalgamation of the vetting unit and recent developments are summarised in the high risk recommendation report to this meeting of the Committee.

4. Appendix 1 also highlights counter fraud activity undertaken to date. We currently have 45 live investigations. We are working our way through 11,580 NFI initial data matches in liaison with MPS Finance Services. The joint MPA/MPS Anti Fraud Strategy approved by the Committee in December 2010 is due be launched. This will be supported by MPS internal press coverage, statements by the Chair of the MPA and the MPS Director of Resources, and a re-launch of the ‘Rightline’. The fraud prevention workshops are also taking place with 350 MPS staff planned to attend by the end of March 2011. These continue to be well received and the output will be used to inform future fraud prevention activity.

5. Investigations and legal proceedings relating to the use of AMEX cards in the MPS have now drawn to a conclusion. Since the Committee last met the final three cases due for criminal prosecution have been heard, all individuals were found guilty and sentenced accordingly. Four cases are being dealt with under internal misconduct procedures and will be concluded early in the new financial year.

Internal Control Environment

6. The overall assurance score to date for 2010/11 based on our final reports is 2.5 [1] with first time reviews scoring 2.8 and follow ups 2.3. This is an improvement on last year’s overall score of 2.6 (2.9 first time reviews and 2.4 follow ups) for 2009/10. Follow up activity continues to show improvements to the control framework.

7. The progress made in implementing our recommendations for the previous two calendar years is shown at Appendix 2. The analysis shows that 87% of recommendations from 2009 and 65% from 2010 have been implemented. We are working with Finance Services to evaluate the recommendations outstanding from 2009 to determine if they remain relevant and to facilitate their implementation where appropriate. Those recommendations made in the final quarter of 2010 are not yet due to be implemented, taking this into account, the level of implementation has improved over the last two years.

8. There is a significant reduction in the number of audit recommendations shown by the analysis for 2010. This is due to two main factors. The average recommendations per audit has reduced and delays in clearing a number of draft reports issued in the last quarter of the year that dealt with some particularly complex areas, contributed to fewer final reports being issued overall.

9. Our analysis of recommendations made to date this year shows that the main issues continue to be around management supervision and review (38%), record keeping (17%) and guidance and training (20%).

Work in Progress

10. We are completing our risk reviews of the risk maturity framework and assessment, information sharing governance framework, covert procurement and management of assets, police officer and staff discipline framework and CO management and deployment of assets. Key follow up audits of the leadership academy, resourcing and management of specials and the S015 Counter Terrorism Command are also underway. Our reviews of Operation Blunt and Secure Intelligence Systems have been carried forward into 2010/11 at the request of senior management in those areas.

11. Utilising our recently appointed ICT audit specialists we are conducting reviews of Command and Control and the Crime Reporting Information System. This is primarily to provide assurance on the resilience of these systems leading up to the Olympic and Paralympic Games.

12. Our BOCU review programme is focusing on key business and finance risk areas such as: budgetary control, the local risk management framework, police overtime, allowances and expenses, crime property and HR systems. We are working in liaison with TPHQ to ensure a corporate response to any emerging risk and control issues. These reviews will inform the work of the TP Development Programme as agreed following recent discussions with the TP Development Programme Manager and Assistant Commissioner Territorial Policing.

13. Our monthly meetings with the Audit Commission and HMIC continue to be productive in co-ordinating our review activity and discussing emerging issues.

14. In contributing to the GLA shared service initiative we have finalised our proposal to provide the internal audit service for the GLA from the 1 April 2011. We are continuing to explore further opportunities across the GLA group to make best use of available audit skills and resources.

Directorate of Audit, Risk and Assurance Performance

15. The directorate is currently on target to complete 90% of the risk review work programme by the year end, and to complete those follow ups that are now due in 2010/11. We will also have completed our reviews of two specialist OCUs and provided an initial report on our BOCU work.

16. We are exceeding our productivity target of 75%, currently achieving 85% and are spending our time broadly as planned, although we have not spent as much time as originally planned on our advisory and BOCU work. This is mainly due to long term sickness absence and the length of time taken to recruit a new Head of Risk and Compliance. We have employed temporary staff to cover a proportion of the time lost with the main focus on completing the risk review programme.

C. Other organisational and community implications

Equality and Diversity Impact

1. The MPA’s commitments to equality and diversity are considered in all activities carried out by the Directorate of Audit, Risk and Assurance. The conduct of our staff is also monitored through questionnaires to auditees on a range of matters related to audit and investigative work.

Consideration of MET Forward

2. Completion of the Directorate of Audit, Risk and Assurance annual work programme, which is designed to support all strands of MET Forward and in particular MET Standards, is making a key contribution to fighting crime, securing value for money and increasing confidence in policing.

Financial Implications

3. There is a risk of loss, fraud, waste and inefficiency if DARA recommendations are not effectively implemented. Savings and recoveries made as a result of audit work enable funds to be directed towards core policing activities.

Legal Implications

4. There are no direct legal implications arising from the report.

Environmental Implication

5. There are no direct environmental implications arising from the report.

Risk Implications

6. Appendix 1 highlights areas of effective management of risk and areas for further improvement identified as a result of DARA review activity.

D. Background papers

• Appendix 1 – Summary of DARA Activity 4th Quarter 2010/11
• Appendix 2 – Analysis of DARA recommendations

E. Contact details

Report author: Julie Norgrove, Director Audit, Risk and Assurance, MPA

For information contact:

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

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