Internal Audit Charter and Terms of Reference

This Charter describes the purpose, authority and principal responsibilities of our Internal Audit Section.

Purpose

Internal Audit is an independent assurance function established to examine and evaluate activities as a service to the organisation and to contribute advice at an early stage in the implementation of any developments / amendments to processes.

The Head of Audit & Inspection provides elected members with an annual assurance statement on the adequacy and effectiveness of our internal control arrangements including the arrangements in subsidiary bodies incorporated in our group accounts.

Authority

The Head of Audit & Inspection:

• reports to the Executive Director of Financial Services and has open access to the Council's Chief Executive;
• liaise directly with Council Members on such matters as deemed appropriate, and
• reports to the Council Committee charged with the responsibility for overseeing audit on matters of significance affecting the Council in terms of achieving its key objectives.

Internal Audit's authority is derived from policies, procedures, rules and regulations established by us. These include Financial Regulations, Conditions of Service, Whistleblowing & Response Policy and Code of Conduct. Similarly, the Internal Audit Section takes due cognisance of the standards promoted by external bodies including the Chartered Institute of Public Finance and Accountancy, Audit Scotland, the Convention of Scottish Local Authorities and the Local Authority (Scotland) Accounts Advisory Committee.

The Head of Audit & Inspection produces the Audit Plan and manages its implementation. The Audit Plan is presented for approval to the Chief Executive, the Executive Director of Financial Services and appropriate Council Committee, which will normally be prior to the start of the financial year.

Internal Audit has unrestricted access to all our records whether manual or computerised, cash, stores and other property, can obtain explanations, may enter our property or land and has unrestricted access to all locations and officials, where necessary on demand and without prior notice. Internal Audit also has access consistent with the Head of Audit & Inspection's requirement to produce an annual statement covering the actions of the companies and trusts in our group accounts.

Terms of Reference

Executive Directors are responsible for ensuring that internal control arrangements are sufficient to address the risks facing their Services.

Internal Audit's terms of reference include but are not limited to:

1. ensuring the Council approved Whistleblowing & Response Policy is implemented and kept under review;
2. reviewing the reliability and integrity of financial and operating information and the means used to identify, measure, classify and report such information;
3. a) reviewing the systems previously established to ensure compliance with policies, plans, procedures, laws and regulations including but not limited to Data Protection, Information Technology, Risk Management, Procurement, governance and; b) assisting in the formulation of policies and procedures to maintain a secure control environment;
4. reviewing the means of safeguarding assets and, as appropriate, verifying the existence of such assets;
5. working with external agencies to ensure that a Best Value Service is delivered;
6. assisting in the verification of performance measures;
7. working with external agencies to ensure a managed audit approach;
8. involvement in the Council's Sanctions Panel, Smoking Appeal Panel and other similar bodies;
9. examining and evaluating the corporate governance arrangements within companies etc that are included in the group accounts;
10. working with private sector partners to ensure that specialist skills are available, and
11. participating in the National Fraud Initiative and other data matching exercises with external bodies.
12. examining and evaluating the adequacy of the Council's system of internal control and providing an annual assurance statement to members;

In meeting its responsibilities, Internal Audit activities will be conducted in accordance with our strategic objectives and established policies and procedures and with the working procedures incorporated in the Audit Manual.

In addition, Internal Auditors will comply with the Code of Ethics and the Code of Practice for Internal Audit in Local Government promulgated by the Chartered Institute of Public Finance and Accountancy and other such professional bodies.

Internal Audit will take cognisance in its work of Freedom of Information, Data Protection and Human Rights legislation.