An alleged theft of stock by a member of council staff led to new “arrangements” being introduced by the local authority.

The Southampton City Council employee was dismissed due to wider performance issues, a report by the chief internal auditor said.

The alleged theft was one of two reactive investigations carried out by the local authority’s internal audit service in 2023/24.

Information on the stock involved was not detailed, however, it was estimated as below £500 worth of goods.

The other investigation involved a company the council used as a supplier, which had dissolved, reportedly committing tax evasion.

This came to light during post-supplier due diligence checks.

The annual report by chief internal auditor Elizabeth Goodwin said the company was reported to HMRC and subsequently invoiced for £33,530.

At the first meeting of the council’s audit committee on Monday, July 29, councillors asked Ms Goodwin for more details on the incidents and any changes that had been introduced.

She said: “The one in relation to stock and so forth, the controls in and around the system, yes there have been new arrangements implemented, so there is definitely learning from that perspective.

“The tax evasion is an interesting one because it wasn’t a control failure that caused the tax evasion to occur.

“The supplier dissolved. Now unless we check on a regular basis and, you can imagine the level of suppliers that we have, which is very impractical, so it was an interesting one because it is the first tax evasion fraud that we have incurred on this side of the equation.

“We always attempt to learn lessons from an audit perspective as well with how this can be identified but I think the service would struggle because it wasn’t a control failing that enabled it to be perpetrated.”

The annual report said the reactive work in the last financial year also included giving 11 items of advice across various council services on risk and control.