POL00448135 - Post Office - Operational Training Guide (Section 16 Money Transfer Service) V4.0

Evidence on official site

3.3 Intemal Audit Update

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7. BoE Note Circulation Scheme (Ref. 2021/22-02)

Needs Improvement

Sponsor:
Al Cameron

Audit actions:

Appendix 3

The objective of this audit was to review the controls in place to
ensure compliance with the rules in relation to the Bank of
England's Note Circulation Scheme; this included ensuring that all
notes held in BoE Bond were correctly reported and the process of
moving notes to 'borrow' from, and pay into BoE were correctly
declared to BoE and subject to appropriate accounting treatment.

We found that effective controls have been implemented in

response to the issues that occurred in late 2020. However, we

identified some control weaknesses that require remediation, most

importantly:

* Processes and controls are not standardised across cash
centres;

* Staff undertaking site/vault access reviews are not always
independent and site access reviews are not evidenced;

* The delivery model for training of staff in relation to NCS rules,
should be reviewed, standardised and formalised;

* There is no standardised process for recording of issues and
incidents;

* There are key person dependencies at each cash centre.

Management Comment provided by Russell Hancock (Suj

ly Chain Director’

“Thanks to Garry and his team for their continued support, guidance and challenge as we continue to
refine and enhance our capability with regards to NCS standards. It is comforting to know that we are
heading in the right direction, we need to ensure consistency across the whole of the cash operations
teams and work to close the gaps identified. All of the findings will be rectified quickly.

We will continue to work with the Internal Audit team to ensure these actions are closed down and look
forward to welcoming the team back into our cash operations to measure further improvement.”

8. IDG Assurance Phase 3 (Ref.2021/22-15)

Needs Improvement

Sponsor:
Dan Zinner

Audit actions:

Appendix 4

Internal Audit were tasked to provide an assessment of the
effectiveness of the improvements completed up to 30" June 2021.
Prioritisation of improvements for review was again based on the
impact status.

Phase 3 commenced 12" July 2021 and reviewed the effectiveness
of all improvements (excluding those rated yellow) not previously
assessed that were due for completion by end June 2021. There
were 29 improvements for review in Phase 3: Oxblood Red (2), Red
(11) and Orange (16).

Progress continues to be made on implementing the improvements
identified by the various workstreams and under the oversight of
the IDG. Whilst the majority (23 out of 26) of the improvements in
Phase 3 have been delivered on schedule there remain examples of
improvements that have been marked as complete but, on testing,
have elements that are still in progress. These require focus and
follow up by IDG.

At the end of Phase 3, we conclude that 120 of the 126
improvements assessed to date are effective, with the remainder
being put back in remediation or deferred. We also highlight that
reconciliation of the tracking of actions is required to ensure
consistency in the numbers being reported.

Confidential

Post Office Limited - Audit, Risk & Compliance Committee-28/09/21

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