Head of Internal Audit - John Leak – advised members that the Audit Charter provided a framework for the operation of the Internal Audit Service and was required by the Public Sector Internal Audit Standards (PSIAS) which required the charter to be approved by the ‘Board’, which for the Council’s purposes was the Audit & Accounts Committee.
The PSIAS required that the charter should:
· recognise the mandatory nature of the PSIAS;
· define the scope of internal audit activities;
· establish the responsibilities and objectives of internal audit;
· establish the organisational independence of internal audit;
· establish the accountability, reporting lines and relationships between the Head of Audit and the Audit Committee and those to whom the Head of Audit reports to functionally and administratively;
· set out the responsibility of the Audit Committee and also the role of the statutory officers with regards to internal audit;
· set out the arrangements that exist within the organisations counter-fraud and corruption strategy, requiring the Head of Audit to be notified of all suspected or detected fraud, corruption or impropriety, to inform the annual internal audit opinion and the risk-based plan;
· recognise that internal audit’s remit extends to the entire control environment of the organisation and not just financial controls;
· establish internal audit’s right of access to all records, assets, personnel and premises, including those of partner organisations where appropriate, and its authority to obtain such information and explanations as it considers necessary to fulfil its responsibilities.
And that it must:
· define the terms “board” and “senior management” for the purposes of internal audit activity;
· cover the arrangements for appropriate resourcing;
· define the role of internal audit in any fraud related work; and
· describe safeguards to limit impairments of independence or objectivity if internal audit or the Head of Audit undertakes non-audit activities.
Amendments to the charter previously adopted in 2017 were confined mainly to changes in job titles and responsibilities.
RESOLVED – That the Council’s updated Internal Audit Charter be APPROVED.