Internal audit arrangements

Report: 5
Date: 28 September 2000
By: Treasurer

Summary

The report informs members about the current arrangements for managing and providing internal audit.

A. Supporting information

Arrangements prior to 3 July 2000

1. Prior to the establishment of the Metropolitan Police Authority, the MPS Internal Audit operated within a central government environment reflecting the role of the Home Secretary as police authority for London. The Director of Internal Audit (DIA) reported to the Receiver and to an Audit Committee of senior MPS police and civil staff chaired by its only independent member, Sir John Quinton. The DIA also had a right of direct access to the Commissioner and to the permanent head of the Home Office. Home Office Internal Audit had the right to review the work and plans of MPS Internal Audit. The National Audit Office provided external monitoring of the work of Internal Audit.

Current arrangements

2. From 3 July, the financial arrangements for the Metropolitan Police including the provision of internal audit have moved into the local government environment. As a local authority, the MPA is responsible under the Accounts and Audit Regulations 1996 for securing an adequate and effective internal audit. The Authority has delegated the executive responsibility to the Treasurer and has established the Audit Panel to oversee the internal audit arrangements, inter alia.

3. The Director of Internal Audit therefore now reports to the Treasurer and the internal audit staff are under the direction and control of the Authority rather than the Commissioner. The DIA also has independent access to members through the Audit Panel. He will report in his own name on the work and findings of Internal Audit.

4. Internal Audit will continue to liaise closely with the Commissioner and MPS management and will provide advice as well as conducting a programme of audit reviews. The Director of Resources is responsible for facilitating the work of Internal Audit within the MPS and for representing Internal Audit’s interests on the MPS Management Board.

Means of delivery

5. Internal audit is currently provided largely by directly employed staff supplemented by the use of external contractors. Members will appreciate that an internal audit service could be provided in a variety of ways. Best Value will require us in due course to review the basis of delivery and to assess the competitiveness of the existing arrangements. There is also likely to be a dialogue with the GLA and other functional bodies about the options for cooperation in the delivery of generic financial services such as internal audit. It is my view that we should continue with the present basis of delivery, relying primarily on directly employed internal audit staff, recognising that these arrangements will come under scrutiny in the near future.

6. The following reports on the Panel’s agenda provide more detail on the operation of internal audit. A summary of the Director of Internal Audit’s Annual Report for 1999/2000 is also attached for members’ information.

B. Recommendation

To note the current responsibilities for, and means of delivery of, internal audit.

C. Financial implications

None.

D. Review arrangements

The arrangements for delivery of internal audit will be reviewed under Best Value both within the MPA’s own programme and in joint consideration with the GLA.

E. Background papers

The following is a statutory list of background papers (under the Local Government Act 1972 S.100 D) which disclose facts or matters on which the report is based and which have been relied on to a material extent in preparing this report. They are available on request to either the contact officer listed above or to the Clerk to the Police Authority at the address indicated on the agenda.

F. Contact details

The author of this report is Peter Martin.

For information contact:

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

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