I hereby give notice that an ordinary meeting of the Audit and Risk Committee will be held on:

 

Date:

Time:

Meeting Room:

Venue:

 

Thursday, 13 September 2018

2:15pm

Room 1, Level 26
135 Albert Street
Auckland

 

 

Komiti Tātari me te Mātai Raru Tūpono /

Audit and Risk Committee

 

OPEN AGENDA

 

 

 

MEMBERSHIP

 

Chairperson

Sue Sheldon, CNZM

 

Deputy Chairperson

Deputy Mayor Bill Cashmore

 

Members

Cr Ross Clow

 

 

Paul Conder

 

 

Cr Richard Hills

 

 

Bruce Robertson

 

Ex-officio

Mayor Hon Phil Goff, CNZM, JP

 

 

IMSB Chair David Taipari

 

 

(Quorum 3 members)

 

Quorum must include two Governing Body members

 

Mike Giddey

Governance Advisor

 

7 September 2018

 

Contact Telephone: (09) 890 8143

Email: mike.giddey@aucklandcouncil.govt.nz

Website: www.aucklandcouncil.govt.nz

 

 



Terms of Reference

 

Purpose

 

The purpose of the Audit and Risk Committee is to assist and advise the Governing Body in discharging its responsibility and ownership of governance, risk management, and internal control.

 

The committee will review the effectiveness of the following aspects of governance, risk management and internal control:

 

·    enterprise risk management (ERM) across the Auckland Council group

·    internal and external audit and assurance

·    integrity and investigations

·    monitoring of compliance with laws and regulations

·    significant projects and programmes of work focussing on the appropriate management of risk

·    oversight of preparation of the LTP, Annual Report, and other external financial reports required by statute.

 

The scope of the committee includes the oversight of risk management and assurance across council’s CCOs with respect to risk that is significant to the Auckland Council group.

 

To perform his or her role effectively, each committee member must develop and maintain his or her skills and knowledge, including an understanding of the committee’s responsibilities, and of the council’s business, operations and risks.

 

Decision-Making Powers

 

The committee has no decision making powers. 

The committee may request expert advice through the chief executive where necessary.

The committee may make recommendations to the Governing Body and / or chief executive.

 

Tenure

 

External members will be appointed for an initial period not exceeding three years, after which they will be eligible for extension or re-appointment, after a formal review of their performance, and have not already served two terms on the committee. Councillors appointed to the committee will automatically cease to hold office at the time of the local authority triennial elections. They may be eligible for re-appointment post those elections if they are returned to office and have not already served two terms on the committee.

 

The chief executive, and the senior management team members will not be members of the committee.

 

The members, taken collectively, will have a broad range of skills and experience relevant to the operations of the council. At least one member of the committee should have accounting or related financial management experience, with an understanding of accounting and auditing standards in a public sector environment.


 

Committee’s responsibilities

 

The committee’s responsibilities are detailed below.

 

Forward Work Programme

 

The committee will agree and approve annually a forward work programme – which will consist of in depth briefings and reviews of specific significant risks and assurance strategies, as contained in the ERM “Top Risks” or Auckland Council’s work plan.

 

Risk management

 

·         Review, approve and monitor the implementation of the ERM policy, framework and strategy (including risks pertaining to CCOs that are significant to the Auckland Council group).

·         Review and approve the council’s “risk appetite” statement.

·         Review the effectiveness of risk management and internal control systems including all material financial, operational, compliance and other material controls. This includes legislative compliance (including Health and Safety), significant projects and programmes of work, and significant procurement.

 

 

Internal Audit

 

·         Review annually the Internal Audit Charter – which confirms the authority, independence and scope of the function.

·         Review and approve annually and monitor the implementation of the 3 year Internal Audit Strategy and 12 month detailed Internal Audit Plan.

·         Review the co-ordination between the risk and internal audit functions – including the integration of the council’s ERM risk profile with the Internal Audit programme. This includes assurance over all material financial, operational, compliance and other material controls. This includes legislative compliance (including Health and Safety), significant projects and programmes of work, and significant procurement.

·         Review the reports of the Internal Audit functions dealing with findings, conclusions and recommendations (including assurance over risks pertaining to CCOs that are significant to the Auckland Council group)

 

Fraud and Integrity

 

·         Review and approve annually, and monitor the implementation of, the Fraud and Integrity Strategy, including detailed work programme.

·         Review annually the whistleblowing procedures and ensure that arrangements are in place by which staff, may, in confidence, raise concerns about possible improprieties in matters of financial reporting, financial control or any other matters, and that there is proportionate and independent investigation of such matters and appropriate follow-up action.

·         Review the procedures in relation to the prevention, detection, reporting and investigation of bribery and fraud.

·         Review and monitor policy and process to manage conflicts of interest amongst elected members, local board members, management, staff, consultants and contractors.

 

Statutory Reporting

 

Review and monitor the integrity of the interim and annual report including statutory financial statements and any other formal announcements relating to the council’s financial performance, focussing particularly on:

 

·         compliance with, and the appropriate application of, relevant accounting policies, practices and accounting standards

·         compliance with applicable legal requirements relevant to statutory reporting

·         the consistency of application of accounting policies, across reporting periods, and the Auckland Council group

·         changes to accounting policies and practices that may affect the way that accounts are presented

·         any decisions involving significant judgement, estimation or uncertainty

·         the extent to which financial statements are affected by any unusual transactions and the manner in which they are disclosed

·         the disclosure of contingent liabilities and contingent assets

·         the clarity of disclosures generally

·         the basis for the adoption of the going concern assumption

 

External Audit

 

·         Discuss with the external auditor before the audit commences:

·         the nature and scope of the external audit

·         areas of audit focus

·         error and materiality levels.

·         Review with the external auditors representations required by elected members and senior management, including representations as to the fraud and integrity control environment.

·         Review the external auditors management letter and management responses, and inquire into reasons for any recommendations not acted upon.

 

 

 


 

 

Interaction with Council Controlled Organisations

 

Other committees dealing with CCO matters may refer matters to the Audit and Risk Committee for review and advice.

 

This committee will enquire to ensure adequate processes at a governance level exist to identify and manage risks within a CCO.  Where an identified risk may impact on Auckland Council or the wider group, the committee will also ensure that all affected entities are aware of and appropriately managing the risk.

 

The Head of Risk and Head of Internal Audit are responsible for the provision of quality risk, assurance, insurance and ethics and integrity services for all CCOs except Auckland Transport and Watercare (with the exception of insurance services which are provided to Auckland Transport).  Auckland Transport and Watercare have their own risk and assurance functions. The Head of Risk and Head of Internal Audit are responsible for monitoring CCO risk and internal audit strategies with respect to risks that are significant to the Auckland Council group.

 

Annual Report on the work of the committee

The chair of the committee will submit a written review of the performance of the committee to the chief executive on an annual basis. The review will summarise the activities of the committee and how it has contributed to the council’s governance and strategic objectives. The chief executive will place the report on the next available agenda of the governing body.


Exclusion of the public – who needs to leave the meeting

 

Members of the public

 

All members of the public must leave the meeting when the public are excluded unless a resolution is passed permitting a person to remain because their knowledge will assist the meeting.

 

Those who are not members of the public

 

General principles

 

·         Access to confidential information is managed on a “need to know” basis where access to the information is required in order for a person to perform their role.

·         Those who are not members of the meeting (see list below) must leave unless it is necessary for them to remain and hear the debate in order to perform their role.

·         Those who need to be present for one confidential item can remain only for that item and must leave the room for any other confidential items.

·         In any case of doubt, the ruling of the chairperson is final.

 

Members of the meeting

 

·         The members of the meeting remain (all Governing Body members if the meeting is a Governing Body meeting; all members of the committee if the meeting is a committee meeting).

·         However, standing orders require that a councillor who has a pecuniary conflict of interest leave the room.

·         All councillors have the right to attend any meeting of a committee and councillors who are not members of a committee may remain, subject to any limitations in standing orders.

 

Independent Māori Statutory Board

 

·         Members of the Independent Māori Statutory Board who are appointed members of the committee remain.

·         Independent Māori Statutory Board members and staff remain if this is necessary in order for them to perform their role.

 

Staff

 

·         All staff supporting the meeting (administrative, senior management) remain.

·         Other staff who need to because of their role may remain.

 

Local Board members

 

·         Local Board members who need to hear the matter being discussed in order to perform their role may remain.  This will usually be if the matter affects, or is relevant to, a particular Local Board area.

 

Council Controlled Organisations

 

·         Representatives of a Council Controlled Organisation can remain only if required to for discussion of a matter relevant to the Council Controlled Organisation.

 

 

 


Audit and Risk Committee

13 September 2018

 

ITEM   TABLE OF CONTENTS                                                                                        PAGE

1          Apologies                                                                                                                      11

2          Declaration of Interest                                                                                                 11

3          Confirmation of Minutes                                                                                             11

4          Petitions                                                                                                                        11

5          Public Input                                                                                                                  11

6          Local Board Input                                                                                                        11

7          Extraordinary Business                                                                                              12

8          Forward Work Programme                                                                                         13

9          Monitoring of Treaty Audit Recommendations                                                       19

10        Role of the Audit and Risk Committee with respect to the City Rail Link Project 89

11        Risk and Insurance Management Update - September 2018                                  93

12        Consideration of Extraordinary Items 

PUBLIC EXCLUDED

13        Procedural Motion to Exclude the Public                                                               189

C1       Updates on the management of risks within council-controlled organisations 189

C2       Draft 2017/2018 Annual Report and Summary Annual Report for Auckland Council and group                                                                                                                           189

C3       Audit of Building and Resource Consents                                                             190

C4       Office of the Auditor-General and Audit New Zealand briefing                           190

C5       Council-controlled Organisations - Quarterly Risk Reports                                190

C6       Cyber Security Risk Deep Dive - August 2018                                                       191

 


1          Apologies

 

An apology from Mayor P Goff has been received.

 

 

2          Declaration of Interest

 

Members are reminded of the need to be vigilant to stand aside from decision making when a conflict arises between their role as a member and any private or other external interest they might have.

 

 

3          Confirmation of Minutes

 

That the Audit and Risk Committee:

a)         confirm the ordinary minutes of its meeting, held on Monday, 27 August 2018, including the confidential section, as a true and correct record.

 

 

4          Petitions

 

At the close of the agenda no requests to present petitions had been received.

 

 

5          Public Input

 

Standing Order 7.7 provides for Public Input.  Applications to speak must be made to the Governance Advisor, in writing, no later than one (1) clear working day prior to the meeting and must include the subject matter.  The meeting Chairperson has the discretion to decline any application that does not meet the requirements of Standing Orders.  A maximum of thirty (30) minutes is allocated to the period for public input with five (5) minutes speaking time for each speaker.

 

At the close of the agenda no requests for public input had been received.

 

 

6          Local Board Input

 

Standing Order 6.2 provides for Local Board Input.  The Chairperson (or nominee of that Chairperson) is entitled to speak for up to five (5) minutes during this time.  The Chairperson of the Local Board (or nominee of that Chairperson) shall wherever practical, give one (1) day’s notice of their wish to speak.  The meeting Chairperson has the discretion to decline any application that does not meet the requirements of Standing Orders.

 

This right is in addition to the right under Standing Order 6.1 to speak to matters on the agenda.

 

At the close of the agenda no requests for local board input had been received.


 

 

7          Extraordinary Business

 

Section 46A(7) of the Local Government Official Information and Meetings Act 1987 (as amended) states:

 

“An item that is not on the agenda for a meeting may be dealt with at that meeting if-

 

(a)        The local  authority by resolution so decides; and

 

(b)        The presiding member explains at the meeting, at a time when it is open to the public,-

 

(i)         The reason why the item is not on the agenda; and

 

(ii)        The reason why the discussion of the item cannot be delayed until a subsequent meeting.”

 

Section 46A(7A) of the Local Government Official Information and Meetings Act 1987 (as amended) states:

 

“Where an item is not on the agenda for a meeting,-

 

(a)        That item may be discussed at that meeting if-

 

(i)         That item is a minor matter relating to the general business of the local authority; and

 

(ii)        the presiding member explains at the beginning of the meeting, at a time when it is open to the public, that the item will be discussed at the meeting; but

 

(b)        no resolution, decision or recommendation may be made in respect of that item except to refer that item to a subsequent meeting of the local authority for further discussion.”


Audit and Risk Committee

13 September 2018

 

Forward Work Programme

 

File No.: CP2018/16670

 

  

Te take mō te pūrongo / Purpose of the report

1.       To review and update the Audit and Risk Committee’s three-year forward work programme.

Whakarāpopototanga matua / Executive summary

2.       The committee approved its three-year forward work programme at its 29 May 2017 meeting.  It is good practice to review the forward work programme at each committee meeting, to ensure that it can be adapted quickly if council’s risk profile changes and that it remains relevant to the needs of the committee.

3.       There are no substantive changes recommended to the forward work programme that arise from a change in the risk profile of council.

4.       The timing of workshops for the following ‘Top Risks’, which were approved as Top Risks by the Audit and Risk Committee in May 2018 still needs to be confirmed:

·   climate change – readiness and response

·   significant internal and external disruptions

·   theft, fraud and corruption.

5.       The Head of Risk will report separately to this meeting on council’s updated top risks. Project and Programme Management and Consenting risk are being added to the ‘Top Risk’ register. The timing for these workshops still needs to be confirmed.

 

Ngā tūtohunga / Recommendation/s

That the Audit and Risk Committee:

a)      reconfirm its forward work programme.

 

 

 

 

Ngā tāpirihanga / Attachments

No.

Title

Page

a

Forward Work Programme

15

      

Ngā kaihaina / Signatories

Author

Mark Maloney - Head of Internal Audit

Authoriser

Phil Wilson - Governance Director

 



Audit and Risk Committee

13 September 2018

 


Audit and Risk Committee

13 September 2018

 


Audit and Risk Committee

13 September 2018

 


Audit and Risk Committee

13 September 2018

 


Audit and Risk Committee

13 September 2018

 

Monitoring of Treaty Audit Recommendations

 

File No.: CP2018/16694

 

  

Te take mō te pūrongo / Purpose of the report

1.       This report updates the committee on the monitoring work performed by the Internal Audit department on council’s Treaty Audit Response Work Programme. The report sets out:

·     the status of the implementation of audit recommendations contained in Te Tiriti o Waitangi Audit Report 2015 as at 30 June 2018.

·     the findings of Te Tiriti o Waitangi Audit Report 2018.

·     the Auckland Council Group’s Treaty Audit Response Programme, the implementation of which will be monitored and reported to this committee on a six-monthly basis.

Whakarāpopototanga matua / Executive summary

2.       In the last quarter of the 2017/2018 year a further two Action Groups were closed by the Waharoa Group. 52 of the 67 audit recommendations from the Te Tiriti o Waitangi Audit Report 2015 have now been implemented. No further Māori Responsiveness Plans have been finalised. The Watercare Services Limited, and People and Performance Māori Responsiveness Plans have progressed to the final approval stage.

3.       The third Te Tiriti o Waitangi Audit has been completed. It was received by the Finance and Performance Committee on 24 July 2018. This report contains 13 recommendations that will strengthen accountability mechanisms. All findings have been accepted.

4.       Te Tiriti o Waitangi Audit Report 2018 notes that council has made a considerable effort over the past 12 months to address a number of outstanding recommendations from the previous two audits. It also recognised that progress has been made in the development of Māori Responsiveness Plans.

5.       Council officers have worked with the Independent Māori Statutory Board secretariat and PricewaterhouseCoopers (PwC) to develop a programme of work to implement the treaty audit findings. Outstanding recommendations from the 2012 and 2015 audits have been included in the Audit Response Programme.

6.       Internal Audit department have reviewed the response programme. Clear accountabilities have been set in place. The programme of work is realistic and achievable.

7.       Te Tiriti o Waitangi Audit Report 2018 report recommends that the Internal Audit department continue monitoring and reporting to the Audit and Risk Committee and that the council’s ‘follow-up’ framework is used by the Waharoa Group.

8.       The Audit Response Programme will now become the basis for Internal Audit’s monitoring and reporting to this committee.

Ngā tūtohunga / Recommendation/s

That the Audit and Risk Committee:

a)      receive the Monitoring of Treaty Recommendations report.

b)      note the monitoring work that has been performed by the Internal Audit department.

c)      note the findings of Te Tiriti o Waitangi Audit Report 2018, and Auckland Council Group’s Treaty Audit Response Programme.

d)      note that the Internal Audit department will report on a six-monthly basis on progress against the Treaty Audit Response Programme to this committee in accordance with the approved Internal Audit work plan.

Horopaki / Context

9.       The Independent Māori Statutory Board’s Treaty of Waitangi Audit process sets out a framework for assessing council’s performance against statutory responsibilities and requirements relating to Te Tiriti o Waitangi and to Māori.

10.     Te Tiriti o Waitangi Audit Report 2015 includes a “Summary of Recommended Actions”, in which 24 action groups are contained.  These are linked to the 67 specific recommendations of the audit report.

11.     Recommendation 66 advised that:

“the responsibility for monitoring the work programme completion should move from Te Waka Angamua to Internal Audit, an independent function comprising risk and controls experts, well versed in how to undertake substantive follow up activity and with a direct reporting line to the Audit and Risk Committee, a body charged with oversight of risk, control and compliance matters”.

12.     The forward work programme of this committee requires the Internal Audit department to report to this committee on a six-monthly basis, on its monitoring work on council’s response to the recommendations contained in Te Tiriti o Waitangi Audit Reports.

Tātaritanga me ngā tohutohu / Analysis and advice

The Waharoa Group

13.     The Waharoa Group is comprised of representatives from the department, Te Waka Angamua and the Independent Māori Statutory Board Secretariat. Its role is to monitor progress and apply criteria for closure of actions and each related Treaty Audit recommendation.

Status of Treaty Audit Recommendations - Te Tiriti o Waitangi Audit Report 2015

14.     In February 2018, we reported to this committee that fourteen of 24 action groups of the Treaty Audit had been assessed and categorised as ‘closed’.  Staff forecasted that by 30 June 2018 a further five action groups would be closed and that five action groups would be partially progressed, encompassing:

·     mana whenua participation in resource consents

·     protection of sensitive information

·     development of the Māori Communication Strategy will be partially progressed by June 2018.

15.     By 30 June 2018 a further two Action Groups had been closed. The outstanding action groups at year end represent 15 out of the 67 individual treaty audit recommendations.

Maori Responsiveness Plans

16.     In February 2018 staff reported that 16 Māori Responsiveness Plans had been approved and were being implemented. Further we reported that we were on course for Māori Responsiveness Plans to be in place for all council-controlled organisations by June 2018. Plans were in place and being implemented for Auckland Transport, Auckland Tourism, Events and Economic Development Limited, and Panuku Development Auckland Limited.

17.     Since February 2018, no further Māori Responsiveness Plans have been approved. The Watercare Services Limited Plan has been developed and is at the final review stage, prior to approval by the Watercare Services Limited Board. The People and Performance directorate’s Māori Responsiveness Plan is also at the final review stage prior to approval.

18.     The status of Māori Responsiveness Plans at 30 June 2018 is provided in Attachment B.

19.     Te Tiriti o Waitangi Audit Report 2018 has made specific recommendations designed to strengthen the accountability mechanism in place for the development and implementation of Maori Responsiveness Plans. These are detailed at Part 2 of Attachment C.

Te Tiriti o Waitangi Audit Report 2018

20.     The third Te Tiriti o Waitangi Audit (Te Tiriti o Waitangi Audit Report 2018) has been completed. The report was received by the Finance and Performance Committee in July 2018. A copy of the report is attached at Attachment A for the committee’s information.

21.     As noted in Te Tiriti o Waitangi Audit Report 2018, council has made a considerable effort over the past 12 months to address a number of outstanding recommendations from the previous two audits. It also recognised that progress has been made in the development of Māori Responsiveness Plans.

22.     The report recommends that:

·     monitoring and reporting by Internal Audit department continues

·     the council’s ‘follow-up’ framework is used by the Waharoa Group

·     monitoring and reporting to the Audit and Risk Committee continues.

Treaty Audit Response Work Programme

23.     In total there are 13 new recommendations in Te Tiriti o Waitangi Audit Report 2018. All recommendations have been accepted and will be actioned as described in the council group’s Draft Treaty Audit Response Programme (Attachment C).  Outstanding recommendations from the 2012 and 2015 audits have been included in the Audit Response Programme.

24.     Council Officers have worked with the IMSB secretariat and PwC to develop the response programme.

25.     Internal Audit department have reviewed the Draft Treaty Audit Response Programme.  Accountabilities have been clearly set in place. Milestones are reasonable and achievable.

26.     The response programme was endorsed by the Executive Leadership Group (comprising Auckland Council’s Executive Leadership Group and the chief executives of the council-controlled organisations) in August. It will be reported to the Finance and Performance Committee in October 2018.

27.     A summary of progress against the response programme will be included in the quarterly reporting to the Finance and Performance Committee on Māori outcomes for the Auckland Council group.

28.     The Treaty Audit Response Programme will now become the basis for monitoring of implementation and reporting to this committee.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe /
Local impacts and local board views

29.     The views of local boards have not been sought in relation to this report.

Tauākī whakaaweawe Māori / Māori impact statement

30.     The Treaty of Waitangi Audit Response Work Programme enables the council group to strengthen responsiveness to Māori through targeted actions and improvements.

Ngā ritenga ā-pūtea / Financial implications

31.     The committee is not being asked to make a decision with financial implications.

Ngā raru tūpono / Risks

32.     The committee is not being asked to make a decision in which they need to be informed about risk.

Ngā koringa ā-muri / Next steps

33.     The Internal Audit department will continue to monitor the Treaty Audit response programme in accordance with its approved work programme, and the committee’s forward work programme.

 

Ngā tāpirihanga / Attachments

No.

Title

Page

a

Te Tiriti o Waitangi Audit Report 2018

23

b

Status of Maori Response Plans at 30 June 2018

83

c

Draft 2018 Treaty Audit Response Work Programme

85

     

Ngā kaihaina / Signatories

Author

Mark Maloney - Head of Internal Audit

Authoriser

Phil Wilson - Governance Director

 


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13 September 2018

 

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Role of the Audit and Risk Committee with respect to the City Rail Link Project

 

File No.: CP2018/16695

 

  

Te take mō te pūrongo / Purpose of the report

1.       This paper clarifies the role of the Audit and Risk Committee (the committee) with respect to discharging its governance role over the City Rail Link (CRL) project.

Whakarāpopototanga matua / Executive summary

2.       The role of the committee is to provide assurance to the Governing Body that significant investor risks (i.e. risk from the viewpoint of council as a significant investor in the CRL project), are identified and being appropriately managed.

3.       It is critical that this role does not become confused with management of such projects.

4.       The Auckland Council representatives on the Joint Sponsors Committee are currently preparing a risk assessment of investor risk. This will set out key investor risks and mitigating strategies. This is being prepared with oversight by the Head of Risk, and the Assurance Manager. Staff are proposing to report this assessment to this committee at its December 2018 meeting.

5.       To discharge the committee’s responsibility:

·     the committee should review the CRL investor risk profile, make appropriate enquiries, and if satisfied with the responses and information provided endorse that investor risk assessment

·     the investor risk assessment should be regularly updated and reported to the committee

·     if the committee identifies concerns with either the completeness of risks identified, or the way these risks are being managed they can make recommendations to the chief executive, and /or the Governing Body.

 

Ngā tūtohunga / Recommendation/s

That the Audit and Risk Committee:

a)      receive this report.

b)      note that the Auckland Council investor risk profile will be tabled with the committee in December 2018.

c)      endorse that this committee receives regular investor risk reports with respect to City Rail Link, so that the committee can provide assurance to the Governing Body that Auckland Council’s risks as project investor are appropriately identified and managed.

 

 

Horopaki / Context

6.       The Governing Body on 29 June 2017 resolved that the Audit and Risk Committee will receive regular reports on the CRL project status, including a record of all sponsor decisions made under delegated authority and information on the management of key risks (budget, schedule, specification, safety and probity) (GB/2017/72).

7.       The first of these regular reports was received by the committee in December 2017.

8.       However, the committee expressed a concern as to what this resolution meant and resolved to receive a further report that clarified what the governance role of that committee is.

9.       It is critical that the clarification of the committee’s role ensures that its reinforces the committee’s governance role and does not become confused with management of such projects.

Tātaritanga me ngā tohutohu / Analysis and advice

Role and Purpose of the Committee

10.     The purpose of the Audit and Risk committee is to provide assurance to the Governing Body on matters of governance, risk and internal control.

11.     In substance this means that Auckland Council’s risk management systems are identifying the right risks that Auckland Council faces, and there are appropriate internal control and reporting mechanisms in place – that provide confidence and assurance to the Governing Body that these risks are being appropriately managed.

12.     This purpose is reflected in the committee’s Terms of Reference.

13.     The scope of the committee’s work includes reviewing the effectiveness of risk management and internal control systems. This includes reviewing the effectiveness of risk management and internal control for significant projects, and significant procurement.

14.     The role of the committee is to provide assurance to the Governing Body that significant risks – from the viewpoint of Council are identified and appropriately managed.

15.     Should the committee, after making appropriate enquiries, identify concerns with the way these risks are being managed they can make recommendations to the chief executive, and/or Governing Body of Auckland Council.

City Rail Link

16.     The CRL is being jointly funded on an equal basis between the Crown and Auckland Council (project sponsors).

17.     City Rail Link Limited, which was established on 1 July 2017, has the full governance, operational and financial responsibility for CRL, with delivery targets and performance expectations. The project with be delivered in 2024, within a total funding envelope of $3.4 billion.

18.     The Auckland Council investor risks, with respect to CRL are likely to be (but not necessarily limited to):

·     financial risk (adverse financial consequence that impacts on council’s ability to meet its financial commitments and deliver on its strategies) arising from a risk materialising within the CRL project

·     reputation risk (damage to the reputation of either elected members or Auckland Council) arising from a risk materialising within the CRL project.

19.     At a project level, to mitigate the risk of either Auckland Council investor financial or reputation risk materialising, we would expect appropriate mitigations in place with respect to:

·     governance risk - failure of project governance to identify and manage project risk

·     project risk – failure to deliver the CRL project on time, to budget and specification (this includes procurement and contract management risk)

·     health and safety risk - failure of health and safety systems to adequately protect project staff and the public.

City Rail Link – Governance of Project and the role of the Assurance Manager

20.     The project has been established with a set of governance and oversight mechanisms.  The overall project governance structure is set out in the diagram below.  

21.     The project contracts specify that most major project approvals will be undertaken by the responsible ministers of the Crown (Transport and Finance), and the mayor and deputy mayor of Auckland, and chief executive of Auckland Council.  Exceptions are decisions about ultimate ownership of CRL assets and any major changes in project scope or budget, which must be agreed by the Governing Body (and the Crown). 

22.     The Sponsors’ Forum comprises senior officials from government and council.  Council’s representative is the Group Chief Financial Officer, Matthew Walker. 

23.     The Joint Sponsors’ Representative is the chair of a team of officials from Ministry of Transport, New Zealand Treasury, and Auckland Council (the Joint Sponsors’ Team).  The team is key conduit of information between City Rail Link Limited and the sponsors and provides key advice to sponsors on approvals and other matters, including funding, governance and risk.  

24.     Sitting alongside the Joint Sponsors’ Team is the Assurance Manager.  The Assurance Manager provides independent assurance function to the sponsor.

25.     Council staff on the Joint Sponsors’ Team anticipate reporting to several council committees, including the Audit and Risk Committee in respect of project status and key risks, and others on matters relevant to the delegations of those committees.

Discharging the Audit and Risk Committee’s responsibility

26.     The role of the Audit and Risk Committee is to provide assurance to the Governing Body that significant investor risks (i.e. risk from the viewpoint of council as a significant investor in the CRL project), are identified and being appropriately managed.

27.     The Auckland Council representatives on the Joint Sponsors Committee are currently preparing a risk assessment of Investor Risk. This will set out key investor risks and mitigating strategies. This is being prepared with oversight by the Head of Risk, and the Assurance Manager. We expect that this will be tabled with this committee at its December 2018 meeting.


 

28.     To discharge the Audit and Risk Committee’s responsibility:

·     the Audit and Risk Committee should review the CRL investor risk profile, make appropriate enquiries, and if appropriate endorse that investor risk assessment

·     the investor risk assessment should be regularly updated and reported to the Audit and Risk Committee

·     if the committee identifies concerns with either the completeness of risks identified, or way these risks are being managed they can make recommendations to the chief executive, and /or Governing Body of Auckland Council.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe /
Local impacts and local board views

29.     Local board views were not required for this report.

Tauākī whakaaweawe Māori / Māori impact statement

30.     This report does not benefit or have any particular impact on Māori.

Ngā ritenga ā-pūtea / Financial implications

31.     The committee is not being asked to make decisions with financial implications.

Ngā raru tūpono / Risks

32.     This paper clarifies the committee’s role with respect to the management of Auckland Council’s investor risk in the CRL project.

Ngā koringa ā-muri / Next steps

33.     Implementation of recommendations is contained in the body of this report.

 

Ngā tāpirihanga / Attachments

There are no attachments for this report.    

Ngā kaihaina / Signatories

Author

Mark Maloney - Head of Internal Audit

Authoriser

Phil Wilson - Governance Director

 


Audit and Risk Committee

13 September 2018

 

Risk and Insurance Management Update - September 2018

 

File No.: CP2018/14057

 

  

 

Te take mō te pūrongo / Purpose of the report

1.       To update the committee on risk management activities at Auckland Council and on the placement of the insurance programme for 2018-2019.

Whakarāpopototanga matua / Executive summary

2.       The quarterly review of council top risks was completed in August 2018 and approved by the Executive Leadership Team (ELT) on 8 August 2018.  The review has resulted in the addition of two high rated risks relating to programme and project management and consent processing.

3.       The Cyber Security top risk was subject to a deep dive in July 2018 and results of the review were reported to ELT on 8 August. Overall, the outcome of the deep dive undertaken concludes that cyber security risk is being managed effectively.  Detailed results of the Cyber Security ‘deep dive’ are included in a separate paper under the confidential agenda.

4.       The 36th America’s Cup (AC36) programme risk workstream is being led by Auckland Council to provide leadership, guidance and oversight for the risk management activities across the programme.  To support the successful delivery of the programme, a fit for purpose AC36 Programme Risk Management Framework has been developed and approved. This committee is included within the framework as a governance and oversight group to provide recommendations to the Governing Body on effectiveness of risk management processes.

5.       A risk maturity assessment is being conducted by Deloitte and is progressing well.  The results of the review will be finalised in November 2018 and reported to this committee at the next meeting in December 2018. 

6.       An implementation plan 2018/2019 has been developed to embed Our Charter across council.  The plan includes initiatives and to embed Our Charter into council’s operational systems, tools, processes and practices. A mandatory e-learning module was launched in July 2018 for completion by 5 September 2018.  As at August 2018, 42 per cent (3461) of total staff have completed the module.  The People and Performance department are tracking progress and following up with staff.

7.       The Auckland Council group insurance programme was successfully placed on 30 June 2018, for the 12 months ending 30 June 2019.  A key change to the indicative insurance programme that was endorsed by the Audit and Risk Committee on 28 May 2018 was a change in the lead insurer for liability insurance and an overall increase in premium by 2.6 per cent.

 

 

Ngā tūtohunga / Recommendation/s

That the Audit and Risk Committee:

a)      note the update on enterprise risk management.

b)      endorse council’s quarterly risk register, risk heat map and future reporting to the Governing Body.

c)      note the update on the Auckland Council group’s insurance placement.

d)      note the update on the 36th America’s Cup Programme.

e)      agree that this committee receives quarterly reports of key risks to the 36th America’s Cup Programme so that the committee can provide assurance to the Governing Body that Auckland Council’s risks as project investor have been appropriately identified and managed.

 

 

Horopaki / Context

8.       This report provides update on risk management activities, council’s quarterly review of the top risk register, insurance renewal programme and key projects.

Tātaritanga me ngā tohutohu / Analysis and advice

The Top Risks Register

9.       Council’s top risks register for 2018 was endorsed by the Audit and Risk Committee in May 2018.  The top risks register is reviewed on a quarterly basis by the ELT to identify any changes to the risk profile, including identification of any emerging risks.

10.     During the annual review of council’s top risks (March – May 2018), a number of ‘key risks’ were identified that did not make it to the council’s top risks register.  To capture and manage these risks, a ‘Departmental Key Risks Register’ was created.  As at 29 August 2018, 13 key risks are captured in this register.  Senior Leadership Teams are responsible to ensure these are being managed effectively at the departmental level.  The Risk team will review the management of these on a regular periodic basis, the results of which will be reported to the Senior Leadership Team and the Executive Leadership teams to provide them assurance that the risks are being managed effectively.

11.     Two additional risk themes have been added to the top risks register on (i) programme and project management and (ii) consent processing.  Both these risks are regarded as strategic risks to council that require attention at the executive level to ensure that the risks are being managed effectively. 

12.     The programme and project management risk has been split from the ‘service delivery’ risk and added as a separate risk in the council’s top risk register.  The consent processing risk has been moved from the council’s Departmental Key Risks Register and included in the council’s Top Risks Register.  The rationale for adding these risks to the council’s Top Risk Register is as follows:

Programme and Project Management

·      Effective programme and project management is required to ensure delivery of council’s Long-term Plan 2018-2028 and significant projects within timelines, budgets, scope and quality. 

·     Management need continuous assurance that robust project management, governance and oversight, monitoring and reporting controls are in place and operating effectively. 

·     The importance of having robust project management controls was also emphasised by the mayor at the 31 May 2018 Governing Body meeting and was also regarded as a top risk at the Governing Body risk workshop held on 7 June 2018.

Consent Processing

·       Auckland Council is the largest accredited building and resource consent authority in New Zealand and is required to comply with various complex legislations and regulatory obligations for granting consents.  In addition, council is required to meet legislative requirements relating to consent processing time. 

·     Auckland is experiencing a significant increase in residential and industrial construction, which has resulted in significant increase in volume and complexity of consent applications. 

·     Council is currently working on responding to the resource consent and building control processing time errors reported by Audit New Zealand. 

13.     The top risk register now comprises of eleven top risks, of which there are six high and five moderate rated risks.  The council’s top risk register has been included within this report as Attachment A and a risk heat map is included in Attachment B. 

14.     The top risk register and the risk heat map will be presented to the Governing Body for its information and feedback.

Top Risks Deep Dive

15.     Council’s top risks are subject to ‘deep dives’ by the Risk team on a rotational basis to provide assurance to ELT and the Audit and Risk Committee that risks are being effectively managed and controls are operating as intended. 

16.     The Cyber Security top risk was subject to a ‘deep dive’ in July 2018. The results of the review were presented to ELT on 8 August 2018. The outcome of the ‘deep dive’ concludes that overall, the cyber security risk is being managed effectively by the business owner (the Information and Communications Technology department).  An update on the Cyber Security deep dive will be provided to this committee in a workshop and a detailed report is included in a separate paper under the confidential agenda.

17.     The planning for the ‘Fit for Purpose Infrastructure and Community Assets’ top risk ‘deep dive’ is underway.  The outcome of this review will be reported to this committee in December 2018.

America’s Cup 36 Programme Risk Management

18.     The Risk Workstream for the 36th America’s Cup (AC36) programme is being led by Auckland Council, as approved by the AC36 Joint Chief Executive Steering Group (JCEG) in May 2018.  The Risk workstream is responsible for the development of the risk management framework and to provide leadership, guidance and oversight for the risk management activities across the programme. 

19.     The AC36 Programme Risk Management Framework has been developed to manage material risks, issues and incidents across the programme.  The framework is based on best practice and is aligned to the risk management standard AS/NZS ISO 31000:2018.  A common framework across the programme will drive consistency in approach and enable cross group collaboration for managing risks and implementing controls.

20.     This committee has been included within the AC36 Programme Risk Management Framework as playing a role from a governance and oversight perspective to provide advice to the Governing Body that Auckland Council’s risks as project investor have been appropriately identified and managed.

21.     The key elements of the framework, including approach to risk management, governance and oversight roles and responsibilities and reporting and escalations were presented to JCEG in August 2018 for endorsement.  The presentation to JCEG is included within this report as Attachment D and the endorsed AC36 Programme Risk Management Framework is included as Attachment E.

22.     The Risk team has facilitated a number of risk identification workshops across the different workstreams and a draft programme risk register has been developed.  Additional workshops are being conducted to analyse the risks and identify controls.

23.     Reporting on the AC36 programme risks, issues and incidents will be provided to this committee on a quarterly basis, beginning in December 2018.

Risk Maturity Survey

24.     Deloitte is currently undertaking a risk maturity assessment to provide an independent view of the maturity of council’s risk management framework and how well it is embedded in the organisation. The ‘All of Government’ risk maturity model is being used, customised for council. 

25.     The risk maturity assessment is well underway.  Deloitte have completed a number of interviews with members of the ELT and Audit and Risk Committee. In addition, an employee survey questionnaire has been sent to 140 staff comprising of all senior leadership team members, risk champions and other staff within the businesses.

26.     The results of the survey will be finalised in October/November 2018 and reported to this committee at the next scheduled meeting in December 2018. 

Elected member governance and risk workshops

27.     A risk session for Governing Body members was completed on 7 June 2018. The Independent Māori Statutory Board (IMSB) and independent members of the Audit and Risk Committee were also included.  The key objectives of the session were to gain a high level of consensus over the relative significance and management of key risks facing council.

28.     The risk session was attended by 10 out of 21 (47 per cent) Governing Body members and there was good discussion on top risks facing council.

29.     The feedback from the workshop was collated, reviewed and included in the council’s top risk register, if not included previously.  Ten themes were identified during the workshop as follows:

·     fraud and corruption

·     compliance

·     environmental and climate change

·     data management

·     governance

·     disruption and innovation

·     financial sustainability

·     service delivery

·     relationships

·     major project delivery.

30.     There is general alignment between views of Governing Body members and management on what they see as key risks facing council. All the above themes are included either in the council’s Top Risks or Departmental Key Risks register.

31.     Following each quarterly Audit and Risk Committee meetings, the councils top risk register and a risk heat map will be provided to the Governing Body, with a narrative on changes to the top risks, if necessary.

Our Charter

32.     Following the successful roll out of Our Charter over the period April - June 2018, an implementation plan 2018/2019 has been developed to embed Our Charter across council.  The draft plan is currently being finalised by key stakeholders and includes initiatives and activities to:

·    improve staff and people leader awareness and understanding

·    embed Our Charter into council’s tools, processes and practices.

33.     A communication strategy is in place to ensure staff across council are aware of and continuously reminded about Our Charter and the principles. 

34.     Training and awareness initiatives that have been implemented include:

·     all staff have been provided with a quick reference card to attach to their work station.  In addition, stories and articles focusing on each principle area have been delivered through communications channels such as digital screens, online stories and executive and senior leader communications.

·     launch of a mandatory e-learning module in July 2018 for completion by 5 September 2018.  As at 28 August 2018, 42 per cent (3461) of total staff have completed the module.  The People and Performance team is monitoring progress and following up with staff who have not yet completed the training.

·     the onboarding process for new staff has been updated requiring all new employees to complete the e-learning module. 

35.     A key component of Our Charter is the ‘Speak Up’ principle.  A framework for ‘Speak Up’ is being developed (including a programme of work) to enhance the systems and processes and embed the ‘speak up’ culture and behaviours across council.

36.     A Transition and Embedding group are developing reporting and monitoring processes to monitor staff awareness and understanding.  This includes the designing and creation of a quarterly dashboard report for ELT, beginning in October 2018.

37.     Good progress has been made towards a council group approach for behavioural policies about staff behaviours.   Discussions are underway with the council-controlled organisations on the five (remaining) foundation principle areas, with the objective of agreeing a group policy for these areas by December 2018.

Significant Projects

38.     Significant projects that the Risk team are involved in from a risk leadership and guidance perspective are included within this report as Attachment C.  Regular updates on these are provided for the committee’s information.

39.     The City Centre and Waterfront Portfolio Steering Group and a Working Group has been set up to provide oversight, ensure coordination and management of interdependency risks and issues between key projects across council, including downtown, midtown, CRL, and AC36.  The Risk team is working with City Centre and Waterfront Portfolio Steering Group to establish an appropriate project risk management framework, including effective risk governance, reporting and escalation.  In addition, two risk identification workshops were facilitated by the Risk team and a draft risk register has been created.

Insurance Placement 2018-2019

40.     The Finance and Performance Committee approved the Council group’s indicative insurance programme on 19 June 2018 [Resolution number FIN/2018/110] and the programme was successfully renewed on 30 June 2018, for the 12 months ending 30 June 2019.

41.     Since the indicative programme was endorsed by the Audit and Risk Committee on 28 May 2018 [Resolution number AUD/2018/28], some variations have been made as noted below:

Liability Insurance - change of lead insurer and increase in premium

42.     The council group has changed its lead liability insurer from AIG to Berkshire Hathaway (“Berkshire”) due to the late withdrawal of the negotiated terms by AIG.

43.     A number of factors contributed to the withdrawal including:

·    change in AIG’s risk appetite (as evidenced from industry knowledge), whereby AIG has commenced a staged withdrawal from local government exposure for liability insurance

·    AIG’s assessment of its exposure to council, particularly considering the Tauranga City Council’s Bella Vista claims matter

·    AIG’s assessment of its potential exposure based on notifications of claims from the council group.

44.     The move to Berkshire has resulted in an increase of liability policy premiums by approximately $200,000.  Berkshire’s rates, although slightly higher, are reflective of the current market rates and recent claims notifications made by council group.

45.     Berkshire has a credit rating of AA+ by Standard and Poor’s (international financial services rating agency) and is familiar with the council group’s portfolio as it is an existing support insurer.  Council will continue to build on the relationship with Berkshire to ensure transparent and effective claims management and reporting processes that serve in the best interest of council and Berkshire.

Below ground insurance cover accessed from international market

46.     Based on Aon’s (council group’s insurance broker) risk loss modelling investigation for below ground assets, it was proposed that the loss limit of the insurance cover be increased from $1 billion to $1.5 billion for the year 2018/2019.

47.     Purchasing an additional $0.5 billion cover was challenging in the domestic market due to a number of factors including that traditional markets were already at capacity in the $1billion layer and the capacity that was available was expensive.

48.     To address this issue, and in line with the council group’s insurance strategy to diversify the portfolio with international insurers, Aon accessed specialist global markets (Australia, London, Singapore, and China) for below ground assets that had the capacity to place the extra cover. 

49.     A placement of $0.5 billion loss limit has been made with the Peoples Insurance Company of China who are interested in expanding into Australasia.  The expansion creates an opportunity for council as it creates sufficient market capacity to meet the council group’s future insurance needs.

50.     The Peoples Insurance Company of China are the largest insurance company in the world, were approved by AON’s Global Insurer Security team and have a rating of A- (excellent) by AM Best (international insurance rating agency). 

Increase in fire service levies

51.     In addition to the increased cost of premium, the council group was required to pay fire service levies and taxes. The fire service levy of $1,320,293 has been paid, which includes a sum of $355,663 for defects liability period cover under the annual contract works policy.

52.     There are differing views in the insurance industry on the application of the fire service levy to the contract works policy defects liability period.  AIG, as council group’s insurer, are disputing the applicability of the levy with Fire and Emergency New Zealand.

53.     The council group has agreed to pay the levy while the dispute process is completed, to avoid incurring penalties and interest and on the basis that we reserve our right to recover the sum paid if it is subsequently found to be incorrectly levied.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe /
Local impacts and local board views

54.     Local boards are affected by many of the top risks as they represent risks to the entire council organisation. While no specific consultation has been done for this report, risk management activity will have benefit for local board activities.

Tauākī whakaaweawe Māori / Māori impact statement

55.     This information report does not have any particular benefit or adverse effects on Māori.

Ngā ritenga ā-pūtea / Financial implications

56.     There are no financial implications directly arising from this information report.

Ngā raru tūpono / Risks

57.     This report addresses the key risk and insurance activities.  Risk management activities relating to all matters in this report have been summarised above.

Ngā koringa ā-muri / Next steps

58.     The next quarterly update report to the Audit and Risk Committee will be on 5 December 2018.

 

 

Ngā tāpirihanga / Attachments

No.

Title

Page

a

Top Risk Register 28 August 2018

101

b

Council's Top Risk Heat Map

109

c

Key Projects and Significant Risk Matters Update

111

d

AC36 Risk Programme Presentation to JCEG

117

e

AC36 Programme Risk Management Framework

129

     

Ngā kaihaina / Signatories

Author

Shivali Kukreja - Principal Risk Advisor

Authorisers

Cecilia Tse - Head of Risk

James Hassall - General Counsel

Phil Wilson - Governance Director

 



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Audit and Risk Committee

13 September 2018

 

Exclusion of the Public: Local Government Official Information and Meetings Act 1987

 

That the Audit and Risk Committee:

a)      exclude the public from the following part(s) of the proceedings of this meeting.

The general subject of each matter to be considered while the public is excluded, the reason for passing this resolution in relation to each matter, and the specific grounds under section 48(1) of the Local Government Official Information and Meetings Act 1987 for the passing of this resolution follows.

This resolution is made in reliance on section 48(1)(a) of the Local Government Official Information and Meetings Act 1987 and the particular interest or interests protected by section 6 or section 7 of that Act which would be prejudiced by the holding of the whole or relevant part of the proceedings of the meeting in public, as follows:

 

 

C1       Updates on the management of risks within council-controlled organisations

Reason for passing this resolution in relation to each matter

Particular interest(s) protected (where applicable)

Ground(s) under section 48(1) for the passing of this resolution

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.

s7(2)(h) - The withholding of the information is necessary to enable the local authority to carry out, without prejudice or disadvantage, commercial activities.

In particular, the report contains financial and operational information and details of audit findings which, if released, may jeopardise the commercial operations of the council-controlled organisations.

s48(1)(a)

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.

 

 

C2       Draft 2017/2018 Annual Report and Summary Annual Report for Auckland Council and group

Reason for passing this resolution in relation to each matter

Particular interest(s) protected (where applicable)

Ground(s) under section 48(1) for the passing of this resolution

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.

s7(2)(h) - The withholding of the information is necessary to enable the local authority to carry out, without prejudice or disadvantage, commercial activities.

In particular, the report contains financial assumptions and judgements that have impact on the financial results of the Auckland Council Group as at 30 June 2018.

s48(1)(a)

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.

 


 

 

C3       Audit of Building and Resource Consents

Reason for passing this resolution in relation to each matter

Particular interest(s) protected (where applicable)

Ground(s) under section 48(1) for the passing of this resolution

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.

s7(2)(c)(ii) - The withholding of the information is necessary to protect information which is subject to an obligation of confidence or which any person has been or could be compelled to provide under the authority of any enactment, where the making available of the information would be likely to damage the public interest.

In particular, the report contains operational information which if released may jeopardise the effective delivery of internal audit services.

s48(1)(a)

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.

 

 

C4       Office of the Auditor-General and Audit New Zealand briefing

Reason for passing this resolution in relation to each matter

Particular interest(s) protected (where applicable)

Ground(s) under section 48(1) for the passing of this resolution

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.

s7(2)(h) - The withholding of the information is necessary to enable the local authority to carry out, without prejudice or disadvantage, commercial activities.

In particular, the report from Audit New Zealand contains information regarding the annual report and financial results of the Auckland Council group as at 30 June 2018

s48(1)(a)

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.

 

 

C5       Council-controlled Organisations - Quarterly Risk Reports

Reason for passing this resolution in relation to each matter

Particular interest(s) protected (where applicable)

Ground(s) under section 48(1) for the passing of this resolution

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.

s7(2)(c)(i) - The withholding of the information is necessary to protect information which is subject to an obligation of confidence or which any person has been or could be compelled to provide under the authority of any enactment, where the making available of the information would be likely to prejudice the supply of similar information or information from the same source and it is in the public interest that such information should continue to be supplied.

s7(2)(h) - The withholding of the information is necessary to enable the local authority to carry out, without prejudice or disadvantage, commercial activities.

In particular, the report contains risk reporting and detailed top risks reported confidentially to the respective council-controlled organisations Boards or Audit and Risk Committees.  These have been provided subject to confidentiality.

s48(1)(a)

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.

 

 

C6       Cyber Security Risk Deep Dive - August 2018

Reason for passing this resolution in relation to each matter

Particular interest(s) protected (where applicable)

Ground(s) under section 48(1) for the passing of this resolution

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.

s7(2)(j) - The withholding of the information is necessary to prevent the disclosure or use of official information for improper gain or improper advantage.

In particular, the report contains security sensitive information that could expose council to security breaches if made public.

s48(1)(a)

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.