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Review of Post Office Ltd Audit
Processes and Tools October 2011
Author : Sue Richardson
Network Services Projects & Standards Manager
Pr
Sandra McBride Network Change Advisor
Lee Heil Network Services Admin& Scheduling Team
Leader
Linda McLaughlin Field Team Leader
Dave Ogleby Field Team Leader
Peter Jackson Field Team Leader
David Patrick Field Team Leader
Chris Fayers Field Team Leader
Julia Mann Field Team Leader
Bob Collins Field Team Leader
Frank Martin Field Team Leader
Rita Kendellen Field Team Leader
Chris Gilding Field Team Leader
Paul Humber Field Support Advisor
Mark Sealey Field Support Advisor
Alison Gardner Field Support Advisor
Shirley Hailstones Compliance Risk & Assurance Manager
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Contents
Page 3 - Introduction & Background
Page 4 - The Need for a Review
Page 5 - Commencing the Review
Page 7 - Stakeholder Feedback - Internal Stakeholders
Page 9 - Stakeholder Feedback - Field Support Team
Page 12 - What is New - Changes to the Audit Process Chapters and
Tools
Page 12 - Next Steps & Implementation
Appendices
Appendix A Internal Stakeholder Feedback
Appendix B Field Support Team Feedback
Appendix C Changes to Chapters & Tools
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Executive Summary
Introduction & Background
The Network Support Field Team (NSFT) took over the responsibility
for all POL Financial and Compliance auditing in June 2008. In Jan
2009 a revision was undertaken of all the Audit Process Chapters,
as a basic starting point for the new ways of working using a
multi-skilled team of Field Support Advisor’s, however the audit
processes and tools remained largely unchanged until April 2010.
Currently all of the Audit Process Chapters are reviewed against an
annual rolling timetable and are the responsibility of the Network
Services Team Leaders.
The Need for a Review
Since the initial revision of all audit chapters in Jan 2009,
business as usual operational changes have been made, however, a
complete review has not been undertaken and there has been no pro-
active identification of or engagement with stakeholders, to
ascertain that the processes and outputs are fit for purpose and
will deliver the business requirements.
Delivering the review
A full review was completed during the first two quarters of 2011-
12 Financial Year, and included full stakeholder engagement and
inspection and revision of all process chapters and tools.
Headline Changes to the Audit Process Chapters and Tools
=" All chapters reviewed with the Team Leader owners considering
all stakeholder feedback
= Changes made to varying degrees in every chapter -
clarification given and standards set
=" Reduced audit admin has identified potential time savings for
both Financial and Compliance auditing
=" FAA audit added to the Transfer process
= Two chapters have been removed as these were processes not
audit activity i.e. H&S and Continuity Planning
= A new chapter has been added for CAT Tools (Compliance Audit
Test) & instructions
Next Steps
* All updated chapters and tools are now available on EASE
* Training to FSA’s is being delivered through WTLS in October
* We have returned to BAU in the on-going revision of the
processes and tools
* All new tools and processes will commence from 31** October
2011.
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Introduction & Background
In early 2008 the Network Support Field Team (NSFT) took over the
responsibility for all POL Financial and Compliance auditing from
the National Audit Team (NAT) which was disbanded at that time.
Initially the processes and tools used by the NAT were maintained
in their original format, but in Jan 2009 a revision was undertaken
of all the Audit Process Chapters, as a basic starting point for
the new ways of working using a multi-skilled team of Field Support
Advisors (FSA), to deliver all audit, training and intervention
activity across the Network. At this time the revision was simply
to align the old process’s to the new team structure and to create
robust working tools to deliver the information gathered.
During 2009 the use of’ ’SharePoint’’ was added as a means of
reporting, to improve the speed of availability of reports which is
now ‘’real’’ time rather than incurring the 6 week delay that the
previous system of ‘’cut & paste’’ from the audit reports had
delivered.
In April 2010, the Scheduling & Admin Team at Salford became part
of the NSFT and at the same time took on the role of scheduling all
audit activity and processing the admin arising from all audit
activity. This had previously been the responsibility of the
Network Co-Ordination Team.
Currently all of the Audit Process Chapters are reviewed against an
annual rolling timetable and are the responsibility of the Network
Services Team Leaders.
The Need for a Review
Since the initial revision of all audit chapters in Jan 2009
business as usual operational changes have been made, either as a
result of changes to operational practices within the business, or
and less frequently, requests hi-lighted by stakeholders such as
the Contract Team, Security Team, Product & Branch Accounting
(P&BA), Bank of Ireland (Bol), Compliance Team, Risk & Compliance
Committee (R&CC), and others. However, a complete review has not
been undertaken and there has been no pro-active identification of
or engagement with stakeholders, to ascertain that the processes
and outputs are fit for purpose and deliver the business
requirements.
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Commencing the review
The following stages were planned to deliver the review during the
first two quarters of 2011-12 Financial Year:
1. Identify and engage with all stakeholders, seeking feedback on
each chapter
2. Review the current processes, tools and working papers and
considering the feedback,. revising as appropriate
3. Add some ‘’ Expected Standards’’ to appropriate chapters
and/or add clarity to achieve consistency of deployment across
the team
. Cascade revised material to all - NST, Stakeholders
. Circulate to NST and stakeholders for further feedback
. Review Chapter ownership in light of any changes
. Train the FSA’s , and Team Leaders in the deployment of any
new tools, processes and standards
8. Final communication to stakeholders
YoOos
1. Identify and engage with all stakeholders:
Using the Network Hub Team, all stakeholders were identified in the
form of key players in each Directorate. All were approached for
feedback on the supplied current process chapters, and were asked
to submit feedback using the Lose, Change & Keep approach that had
been used successfully in a review of the new entrant training
offer in 2010-11.
2. Review the current process and tools and working papers
considering the feedback:
Initial meetings were planned and delivered to go through the
current process chapters and all tools and documents used by the
team to either deliver the audit activity or report the findings.
3. Add some‘’ Expected Standards’’ to appropriate chapters and/or
add clarity to achieve consistency of deployment across the
team:
To ensure consistency of deployment of audit activity, a section
giving clarity of standards was added to chapters 1 & 3. Currently
some of the standards required at audit activity, are contained
within the Team Standards document and where appropriate, should be
added to the Audit Chapters for clarity and consistency of
deployment.
4. Cascade revised material to all - NST leadership and
Stakeholders:
The final outputs should be cascaded initially to the NST team
including Head of Network Services, Regional Network Managers, and
Field Team Leaders. This was planned as a face to face event on
the 28 September 2011.
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5. Circulate to NST and stakeholders for further feedback:
The revised process chapters and any changes to reporting should be
shared with the NST team and stakeholders for any further comments
and agreement to the changes.
6. Review chapter ownership in light of any changes:
The current ownership responsibilities should be reviewed to ensure
that chapters that have significant cross-over will be owned by the
same person going forward.
7. Train the FSA’s, and Team Leaders in deployment of new tools,
processes and standards:
It is intended that there will be a number of training events late
Q2/early Q3 to roll out the process to the Field Team who will be
delivering the audit activity. Go- live of the process is
anticipated to commence in Q3 in advance of the next 5 year plan in
2012.
8. Final communication to stakeholders:
All changes and new process chapters will be communicated to the
stakeholders during October 2011.
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Stakeholders Approached for Feedback
Directorates:
o Network Julia Marwood
o Compliance Paul Meadows
o Agents Policy & Contracts Tracy Marshall
o Legal Susan Crichton
o Operations Paul W Martin
o P&BA Dawn Brooks
Other stakeholders:
oO Network Services Field Support Team - Regional Managers, Team
Leaders, Field Support Advisors, Scheduling & Admin Team and
Field Change Advisor
Stakeholder Feedback
Internal stakeholder feedback is detailed in Appendix A
Output:
Internal Stakeholders
Areas highlighted by our Internal Stakeholders that should be
considered for removal:
o Health & Safety Chapter
Chapter 9 Retention of Papers and make reference elsewhere
¢ Chapter 3a Core & Outreach and 3b Follow Up process and
incorporate in Chapter 3
°
Areas that our Internal Stakeholders believed should be changed:
Chapter 3 - Performing a Branch Audit
o Checking MVL’s at branch
Paystation - PING
Clarification of various parts of the process
Process for multiples
Retention period insufficient
Crown Office discrepancies
Add staff names to P32 to save duplication
ATM holdings
Contracts Advisor(CA) to send an acknowledgement text to
Lead Auditor
Horizon Users to be sent to CA
° Lead auditor to send text to CA with result of audit
eo eoeoeooeoe
Pa
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Chapter 3b - Follow up Audits
o If previous gaps not addressed contact CA
Chapter 4 - Transfers
+ Transfer Letter
¢ Transfer Pack
Chapter 5 - Closures
° What is CA’s role?
Chapter 6 - Robbery & Burglaries
o Recoveries process
o Who to notify for PO Local
o Scratchcards - controls for reporting stolen cards
° Who confirms final loss amount
Chapter 11 - Retention of Papers
¢ 60 days - what is being shredded
Chapter 12 - Continuity Planning
¢ Too much information which is not needed
Areas that our Internal Stakeholders believed should remain:
o Chapter 1 - Activity plan for the week to be sent
o Chapter 1
o Chapter 3 - Lead Auditor to send text to Contract Advisor
¢ Chapter 3
¢ Chapter 4 - Transfers Appendix B & D
¢ Chapter 4 - Contact CA for advice regarding posting
discrepancy to Late Account
° Chapter 4&5 - amalgamate
¢ Chapter 6
o Chapter 11
Other areas where issues were raised by Internal Stakeholders were:
Auditors to check figures on P32 and not rely on formulas
Are audit reports always completed?
Confirmation of audit process for Transaction Corrections
Confirmation that all audit reports are stored in archive
Tighter controls needed for PO Local Defund
Robbery Audits - Section required for PO Local
Two chapters don’t have chapter numbers i.e. Health &
Safety and Performing a Cash Centre Audit
o What about T&D audits - do you need to include a separate
section in Chapter 3 to cover this?
@ Could we e mail audit reports to Agents rather than sending
a hard copy?
oreo oeoe
Proposal:
All Feedback provided has been considered / included in the review
of the Audit process
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Field Support Team Feedback
Field Support Team feedback is detailed in Appendix B
The Field Team believe that audit procedures would be improved by
losing:
¢ Report Templates
¢ Texting CA prior to audit
¢ Removal of assessing Minimum Standards at PTA
« Colour on Working papers
Printing of transactions over £5K
Two day follow up phone call
° Cash Management phone call
o Checking of staff and notification of anomalies via P356
° Too much paper work for all types of audit and training
Emailing ECF report to so many recipients
¢ Phone call to NBSC if branch is expected to open within 30
minutes of usual opening team.
° Nit picking scoring of QARs.
+ There are way too many CAT questions
¢ All Jargon plain English would be nice.
o Repeated Audits at same branch
« The need to contact Contracts Advisors/Security Team Leader
when there is an unexplained audit surplus in excess of
£1000 plus completion of EFC.
The Field Team believe the audit process would benefit by changes
to:
Consistent names for team
Names of Appendices
Appendices to be attached separately
Amalgamate Appendices for printing
Document footers to include owners name
P32 & Report templates - problems with tabs & printing
SharePoint to be more user friendly
Use of Computerised Summary Sheet
Standardise format of audit files
Do a FAA audit with compliance at 3-6 months and a PTV at
6-9 months.
Part of the P242 Final account misleading
° Pre-audit communication. Combine outstanding debt figure
with office employee HR register
¢ CAT reporting tool. Can the compliance sheet be defaulted
eo eoeoeoeoeoeoeoe
°
to zero
o Make any version of working papers acceptable
° Schedulers to let CA know of audits in area
o Remove the need to pull off reports
« Improve audit process for Thursday audit after TP
« Clarify £1000 discrepancy and TC statements
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¢ QAR: Change to reflect FAA audit only. If TIER 2 Audits are
to be marked, then have a separate tool for the job.
¢ Unreconciled transfer report not necessary
o Crown audits - add % of total cash
o Destruction of Spoiled Travellers Cheques and Excess Stock
to be added
o Clarify what is to be checked at Transfer
o 60 day retention - change as might be needed by Security
Team different instructions in chapter 3 and 9
Reduce acronyms
o Information on 300 audits to be in one place on EASE
(Audits)
o The search feature on EASE is not very good
Follow Up Balance from the present to a full day at the
branch.
¢ Review process for allocating the number of auditors
required
o Two audits in one day.
¢ All FTM’s must take their lap tops - can this be altered to
the Lead and just one other
Meeting time at branch states that it should not be more
than 20 minutes this should be altered to at least 30
minutes as safe opening times can be checked and more time
to audit branch.
Clarify ‘CAT completed by’ question
Include AEI branches to All Branches database
Freeze headings on Find a Branch database
Amend Defund process following a fire
Receive cash management & agent debt prior to audit as
often no phone reception in remote areas
Access to previous reports.
o Ability to tailor reports to suit branch transactions
(where no F/C in branch, delete reference to it).
« Templates in “Word”, not “Excel”.
Approach to verifying stock unit transfers at FAA (only
need to check “Office Snapshot”).
coo oe
°
¢ Sharepoint input - if we only need to report gaps,
everything else can be taken as correct in line with branch
details. Eliminates errors with NT & NA.
« Is it really necessary to complete a P32 when completing a
FAA that does not have a discrepancy in the cash?
o A quicker way of getting reconciled transfers.
° Have a search tool in documents to save time trying to find
certain documents
o Loading on CATs 1 gap = high risk
° Scoring on minimum sales standards 4-1 is not a wide enough
range.
Revert back to the unreconciled transfers report on the
Horizon system
« Various changes to Chapter 1 to improve accuracy
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The Field Team believe that we should keep:
Add work-aids for all activities
P32 in current format
Notification of staff details in advance
CAT Tool as it is
Emails listing staff on P356 but also include outstanding
dept figure to email.
ooo eoe
Other issue that were raised by the Field Team were:
o Early start audits e.g. Locals - How does the branch
confirm admittance?
o FSA’s require a definition of what decisions an FSA can
make in the field after speaking to a CA.
Proposal:
All Feedback provided has been considered / included in the review
of the Audit process
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What is New — Changes to the Audit Process Chapters and
Tools
The full detail of the changes by Chapter, can be found attached
at Appendix C attached, but the headlines are:
=" All chapters reviewed with the Team Leader owners considering
all stakeholder feedback
=" Changes made to varying degrees in every chapter -
clarification given and standards set
= All print templates removed- all reports and working papers
now printable direct from the tools.
= Potential admin time saving of 40 mins per Compliance audit
i.e. c 1100 hours pa
= Potential admin time saving of 15 mins per Financial audit
i.e. c 620 hours pa
=" Chapters 3a Core & Outreach and 3b Follow Up developed and
added separately to Chapter 3
=" FAA audit added to the Transfer process - but no reports will
be sent to Agents
= Chapter 10 Health & Safety removed and placed elsewhere on
EASE - not an audit process
= Chapter 12 Continuity Planning removed and placed elsewhere on
EASE - not an audit process
= New chapter added (Chapter 10 replacement) for CAT Tools and
User Instructions
= All Appendices have been removed from the Chapter and included
in a zip file, named as the appropriate Appendix letter and
Title
=" The Chapter has a footer giving Chapter owner’s name and
telephone number
Next Steps
* All chapters and tools now on EASE
As of Monday 26tt Sept all the new process Chapters are available
on EASE along with the new tools. The team have been informed of
their availability through the Team Leaders and via the monthly
Audit Update for Period 7.
* Revise chapter ownership?
As part of the cascade to the Team Leaders, there was a
discussion about potential changes to the ownership of Chapters.
All chapters will remain the responsibility of their current
owners, who have developed expertise in each area.
* Plan new calendar for BAU revision?
The Network Services Support Team will move back into a BAU
approach to maintaining and updating the Chapters and tools
following the review, to ensure timely and accurate information
is always available for the monthly cascade to the team.
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. Deliver training to FSA’s through WTLS in October
All Team Leader Teams have a WTL’s planned for October in which
they will cascade these changes and allow time for inspection of
the new process’s and tools. All team members will have been
fully updated by the end of October. Following the cascade on
28th Sept to Team Leaders, and instruction will follow to all
FSA’s to read each revised chapter before commencing any audit
activity.
* Send report out to all stakeholders
All stakeholders will receive a copy of this report and
appendices w/c 17 October 2011.
. Return to BAU revision timetable and Implementation date
All new tools and processes will commence from 318* October
2011.
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