Management Section 6 : Post-transaction Monitoring

6.3 Post-transaction monitoring must be an integral part of the internal audit programme. The Audit Committees of the Boards of Holding Bodies are responsible for the oversight of the programme. The Internal Auditor reports his/her findings to the Audit Committee. The Audit Committee’s oversight of the work of the Internal Auditor includes reporting to the Board.

6.4 The Board is responsible for submitting monitoring reports (including nil returns) to SGHSC no later than 30th October annually. Such monitoring reports should be submitted with appropriate supporting information and explanations for all transactions not classed as Category A (see 6.9 below). It is open to SGHSC to request further information following such reports, including case papers, and to stipulate action requirements. SGHSC may also establish its own (external) monitoring arrangements if required in particular circumstances. Holding Bodies are required to conduct post-transaction monitoring in accordance with the arrangements set out in this section.

6.5 The Internal Auditor, through the Audit Committee, should commission appropriate external support in undertaking post-transaction monitoring. The main task of such support will be to provide professional input into the inspection of transactions and assistance in the preparation of monitoring reports. Those undertaking the inspection should therefore have access to appropriate expertise in the property field. It is open to the Internal Auditor to appoint from the private sector, to use Property Division of the Scottish Government, or the Valuation Office Agency. In appointing from the private sector, Holding Bodies should not engage firms who have acted as consultants or agents to the Holding Body during the period being monitored.

6.6 In the detailed arrangements for monitoring, the Boards of Holding Bodies and Audit Committees should provide for appropriate functional separation between officers responsible for carrying out the monitoring/audit tasks, and those handling property transactions.

6.7 The basis for monitoring is a monitoring proforma which should be completed by Holding Bodies for every transaction. A copy of the form, which should be copied locally, can be found at the following link - Management: Post-transaction Monitoring Proforma. These forms should be used to assist in the selection of cases for detailed examination during the annual monitoring exercise. The size of the sample of cases selected for detailed examination should be based on the number of cases, their materiality, risk profile, the advice of a professional adviser and the internal auditor's professional judgment. Based on these factors, the internal auditor should ensure that a reasonable number of cases are reviewed to enable them to obtain sufficient, reliable and relevant evidence and to provide appropriate assurance on property transactions. The details should include completed monitoring proformas for every transaction together with any appropriate certification required. (see Annex III).

6.8 For the purposes of monitoring, transactions are broken down into the following categories:

6.8.1 sale involving proceeds:

• of under £100,000 or,
• of £100,000 or more,

6.8.2 sale of NHS houses/residential accommodation:

• to sitting tenants;
• on the open market;

6.8.3 grant of lease with a rental value:

• under £10,000 per annum or;
• of £10,000 per annum or more;

6.8.4 acquisition of property;

• by purchase;
• by lease;

6.8.5 transactions involving an excambion

6.9 In preparing inspection reports on individual transactions, Internal Auditors and professional advisers are required to use the following categorisation:

A - transaction has been properly conducted

B - there are reservations on how the transaction was conducted

C - a serious error of judgment has occurred in the handling of the transaction

6.10 The monitoring proforma can also be a useful aide-mémoire. It is recommended that a copy is attached to the front of each transaction file and is updated as the transaction progresses. Such action will facilitate provision of such documentation to the Holding Body’s Audit Committee with other papers at the start of each monitoring cycle.

6.11 The report should be sent to:

Deputy Director
Capital and Facilities
Health Finance and Infrastructure Team
Directorate for Finance, eHealth and Analytics
Room BR.07
St Andrew’s House
Edinburgh EH1 3DG