Internal audit progress report

Report: 7
Date: 9 December 2002
By: Director of Internal Audit

Summary

This report sets out progress for the first six months of the financial year in achieving the 2002/2003 Internal Audit Plan.

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 formal reports since April 1 2002.

A. Recommendations

1. Members to support the Director of Internal Audit’s revised plans to achieve the approved programme within an underspend in the budget for Internal Audit this year.
2. Members to note the current Internal Audit evaluation of the adequacy and effectiveness of internal control in the MPS.

B. Supporting information

Progress against the 2002/03 internal audit plan

1. Provided no further additional major pieces of work are urgently required, we can achieve the systems audit plan for 2002/03 with the majority of audits completed to reporting stage by the end of the financial year. However, less time than planned will be spent on Borough Operational Command Units (BOCU) audits. Although we have been coordinating our work with that of the Inspectorate, including carrying out two reviews together, they will not be undertaking any more reviews of BOCUs following a recent change of strategy.

2. We will instead assist in the provision of risk and control awareness training for key BOCU staff in the New Year and also carry out a review of internal control within the MPA.

3. We were unable to fill vacancies as quickly as anticipated. This, coupled with delays in completing work carried forward from last year has added to the pressures in completing the programme. However, the time saved on BOCU reviews and the outsourcing of at least four audits, in addition to using all our planned contingency time should ensure coverage of the plan for 2002/03.

4. Our programme of follow-up reviews is making good progress and we continue to promote our systems development role by supporting a number of high-risk projects.

Opinion on the adequacy and effectiveness of MPS systems

5. Overall the pattern from our completed work is little changed from my Annual Report on 2001/2002. The encouraging news is that our follow-up audits are generally showing an improved level of control in the systems examined compared to our original audit findings. However, the adequacy and effectiveness of control in systems being reviewed for the first time remains below an acceptable level.

6. We issued two audit reports in high-risk areas, both scored a disappointing 4 (1 = excellent control and 5 = unacceptable lack of control). The two audits concerned were of Police Rent and Housing Allowances and Police and Civil Staff Support within the UK.

7. Thirteen medium risk audit reports were issued with an average score of 3.3. This is poor, but no worse than our findings last year. Line management responses have generally accepted our recommendations to improve control and we will take a keen interest in ensuring that progress is made.

8. The average score for four follow-up reports (excluding FMEs) is an almost acceptable 2.8. (A score of 2 or less indicates adequate or better control.)

Current review work - including investigations

9. We have carried out several major investigations in the last six months, including the identification of significant losses in the disposal of MPA property, over-claiming by linguists, an error leading to a former MPS police officer receiving two salaries for over a year and fraudulent claims by a computer consultant.

10. Our systems development work continues in support of key projects such as MetHR, the Outsourcing of Major Services and the Duties Management and Overtime System. In liaison with the Finance Directorate we are reviewing the arrangements for identifying and managing partnership initiatives and funding. We are also on behalf of the Clerk and in view of our recent investigations into property matters, assisting in the review of the Authority’s contract regulations.

11. In an attempt to alleviate concerns around the level of inspection and review activity, we have conducted two BOCU reviews in liaison with the MPS Inspectorate. The feedback received from BOCU Commanders to date has been positive.

12. I will be reporting on the implementation of the budgetary control framework within the scheme of devolved financial management later in the financial year.

13. We have issued the following final reports on systems audited since my last Annual Report:

• Traffic Control, Management and Enforcement
• Financial Control of Consultative Groups
• Property Rent, Rates and Leases
• Catering Sales and Trading
• Semi-Official Clubs
• Loans to Police and Civil Staff
• Messenger and Mail Services
• Police and Civil Staff Support Given Inside the U.K.
• Informants Reward System
• Deceased Person’s Property
• Write-Offs, Losses and Special Payments Follow Up
• Management and Resourcing of Traffic Wardens Follow Up
• Directorate of Legal Services Imprest Account Follow Up
• Treasury Management Follow Up

Responses to audit reports in high risk areas

14. There are no responses currently outstanding for high-risk reviews.

Implementation of high risk recommendations

15. I will give an oral update at the meeting. We issued thirty high-risk recommendations in final reports in the first six months of the financial year. During our follow-up work we have identified a failure to implement a number of accepted high-risk recommendations from past years, in particular 19 high-risk recommendations (out of 32) from our audit of Forensic Medical Examiners. High-risk recommendations in relation to linguists had also not been implemented although line management are now taking urgent action.

Staffing

16. I currently have thirty-four staff in post. One new Forensic Auditor is due to join us in the new year and I am also in the process of recruiting an Assistant Director. I should, therefore, have thirty-six staff in post at the year-end.

Liaison with other bodies, partnerships and joined-up working

17. Following my presentation to MPS Management Board, we have acted swiftly to ensure that our key messages and advice on control are conveyed to a wider audience. In this event, I have recently launched our own website on the MPS intranet and it is my intention to ensure that it provides useful, practical and up to date assistance where it is most needed.

18. We also continue to co-ordinate with other review agencies and have recently attended the newly formed group set up by DAC House for this purpose. HMIC, District Audit and the Inspectorate also attend. Our liaison with other Police Authority and Local Authority Auditors is also continuing to develop.

Equality and diversity implications

Staff recruited in recent months have further contributed towards the diversity of staff employed within the MPA Internal Audit Directorate.

D. Financial implications

It is likely that MPA Internal Audit will underspend by around £65,000-£90,000 on a budget of £1.6 million for 2002-2003.

E. Background papers

None

F. Contact details

Report author: Peter Tickner, Director of Internal Audit

For information contact:

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

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