THREE internal audit checks on activity within Shetland Islands Council have come back as “unsatisfactory”, a meeting has heard.
These covered the use of consultants, procurement arrangements and management of cash handling in community health and social care services.
A meeting of the council’s audit committee heard on Wednesday that work is ongoing to implement recommendations from the reports.
Internal audits provide an independent assessment of the “effectiveness and integrity of the council’s systems”.
Committee chairman Allison Duncan said the results of the audit reports were “not acceptable” and called for quick action.
Vice-chair Catherine Hughson added it was “really worrying”. “We have to act on this,” she said.
Checks on areas like cyber security response, information security management and housing repairs and compliance checks fared better, although there were recommendations issued for all.
When it came to the use of consultants, the internal auditors said the council does not currently adopt the Scottish Government consultancy good practice guidance.
And if criteria set out by that guidance was applied, nine out of 15 sample consultancy engagements with payments from 2020 to 2022 would not have met the conditions.
They added that some officers did not demonstrate “an understanding of their roles and responsibilities in the procurement process”.
There were also examples of consultancy engagements not being appropriately justified, while there were instances where “delivery of best value compared to in-house delivery” was not demonstrated.
Auditors’ testing also found an “inconsistent and ad-hoc approach to the management of contracts across the council’s services”.
When it comes to procurement all eight recommendations from a 2019/20 procurement review, which were originally due to be implemented between December 2020 and December 2021, “remain outstanding with minimal progress to date”.
Meanwhile auditors visited two community health and social care services buildings in February – one short-term residential unit and one non-residential supported living facility – to review the arrangements in place for managing cash and service users’ property.
While both had a functioning safe, there was “areas of concern” found in the management of petty cash and Hansel funds, which is money donated from the public to improve the wellbeing of service users.
Councillors on the committee were not too impressed with the results of the audit checks.
However they were reassured by officers that work is underway on the recommendations from auditors.
When it came to procuring consultants, corporate services director Christine Ferguson said she felt existing council frameworks were sufficient.
But she said the council would look into the individual cases highlighted by the audit report.
Internal auditor Duncan Black confirmed though that for consultants it could be a quick fix.
He said he felt the processes were “quite informal” and that there may be an issue with awareness.
But Black said he stuck by his wording that if not addressed then there is potential for “significant financial, operational and reputational risk exposure”.
The meeting heard that the council needs to use consultants for large projects where it does not have the expertise in-house – and with other developments in the works this will only continue.
Development director Neil Grant said procuring consultants to fill a shortfall in planning officers was one recent example.
Depute leader Gary Robinson said he was not quite so “pessimistic” about the results of the reports.
“I think this is serious and needs to be taken seriously…but in saying that, the recommendations seem to be fairly straight forward to me,” he said.
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