Internal Audit reports demonstrating diligent work within the Council praised by Audit and Scrutiny members

Members of the Audit and Scrutiny Committee (which took place yesterday, Thursday 23 September) were presented with a report outlining the areas of work which have been undertaken by Highland Council’s Internal Audit section since the Committee’s previous meeting during June 2021.

Of the five audit reports considered, three were given the audit opinions of significant assurance or full assurance.

Internal Audit of Fleet Management Arrangements

Within the Communities & Place Directorate, the Council’s Fleet Management Arrangements were examined. These included ensuring the Council complies with the requirements of its Goods Vehicles Operator Licence for its fleet of 224 Large Goods Vehicles, and in particular the provision of policies covering the Council's vehicle operator centres, vehicle maintenance and driver behaviour.  The audit concluded that there are thorough procedures in place to support compliance with the Council’s obligations in respect of the Operator’s licence and the gave the opinion of significant assurance.

Internal Audit of Financial Management and Reporting

Alongside this, the audit of Financial Management and Reporting (which sits within the remit of the Resources and Finance Service) was also determined to have achieved significant assurance.

This particular audit assessed the effectiveness of the Council’s financial management and reporting arrangements. The audit objectives were to ensure that:

• budget monitoring is effective in terms of its quality, accuracy and completeness; and
• savings monitoring is effective in terms of its quality, accuracy and completeness.

The review considered the budget and savings monitoring arrangements for the Council’s 2020/21 Revenue Budget and compared the Council’s committee reporting with other Scottish local authorities.

It was concluded that the Council has effective arrangements for the management and reporting of its revenue budget and it was acknowledged that the Council will need to use such arrangements effectively to deliver the savings proposals outlined in the Health and Prosperity Strategy for 2021/22.

Internal Audit of Council Tax and Non-Domestic Rates discounts and exemptions

Finally, the work undertaken by Internal Audit on Council Tax and Non-Domestic Rates discounts and exemptions concluded by stating that this area of work had achieved full assurance.

There are a number of Council Tax (CT) and Non Domestic Rates (NDR) discounts and exemptions available to individuals, properties and businesses. Responsibility for administering them sits with the Operations Team for Council Tax and with the Non-Domestic Rates Team for NDR. 

The audit examined the key controls in place around the processing of Council Tax and NDR discounts and exemptions to ensure that appropriate checks are carried out in order to confirm eligibility.  It also undertook to ensure that discounts and exemptions are regularly reviewed in order to ensure ongoing eligibility.

The outcome of the audit found well established systems and processes in place which ensure that CT and NDR discounts and exemptions are appropriately awarded, and eligibility is checked on an ongoing basis.  It also reported that systems have continued to work well despite the additional pressures faced as a result of COVID-19.

All of the changes to Council Tax discounts and exemptions introduced by the Scottish Government as a result of COVID-19 had been identified by Highland Council and implemented accordingly. Additional measures were also taken such as delayed annual NDR billing for 2020/21 and the recovery of CT arrears was paused until July 2020.

Councillor Graham MacKenzie, Chair of the Audit and Scrutiny Committee, said: “I am heartened to see the positive outcomes reported for the majority of the Internal Audit reviews undertaken over the last quarter.  A particular highlight is the outcome of the Council Tax and Non-Domestic Rates discounts and exemptions analysis which achieved full assurance.  My colleagues and I on the Committee are well aware of the hard work required in order achieve such a status and it is testament to the diligent work being undertaken in this area of the organisation.”

Full Assurance is defined as having a sound system of control designed to achieve the system objectives and the controls are being consistently applied.

Substantial Assurance highlights that while there is a generally a sound system, there are minor areas of weakness which put some of the system objectives at risk, and/or there is evidence that the level of non-compliance with some of the controls may put some of the system objectives at risk.

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