Agenda of Audit and Risk Committee

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

Date:

Time:

Meeting Room:

Venue:

Tuesday, 16 December 2014

10.00am

Room 1
Level 26
135 Albert Street
Auckland

Audit and Risk Committee

OPEN AGENDA

MEMBERSHIP

Chairperson	Cr Sir John Walker, KNZM, CBE
Deputy Chairperson	Cr Dr Cathy Casey
Members	Cr Cameron Brewer
	Cr Bill Cashmore
	Mr Paul Conder, CA
	Cr Sharon Stewart, QSM
	Mr Roy Tiffin, FCA
	Cr Penny Webster
Ex-officio	Mayor Len Brown, JP
	Deputy Mayor Penny Hulse

(Quorum 4 members)

Mike Giddey

Democracy Advisor

10 December 2014

Contact Telephone: (09) 307 7565

Email: mike.giddey@aucklandcouncil.govt.nz

Website: www.aucklandcouncil.govt.nz

TERMS OF REFERENCE

Responsibilities

The Audit and Risk Committee will be responsible for:

· Providing objective advice and recommendations to the Governing Body regarding the sufficiency, quality and results of assurance on the adequacy and functioning of the council’s risk management, control and governance frameworks and processes.

· Exercising active oversight of all areas of Auckland Council control and accountability (including Council Controlled Organisations), in an integrated and systematic way, such that the results of risk and assurance reviews and external audits may be incorporated in the priority-setting and strategic planning processes.

· Liaison with Audit NZ and, where necessary, the audit committees of CCOs to ensure robust financial audits and reviews of the Auckland Council group

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.

Staff

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

· Only 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.

IMSB

· Members of the IMSB who are appointed members of the meeting remain.

· Other IMSB members and IMSB staff remain if this is necessary in order for them to perform their role.

CCOs

Representatives of a CCO can remain only if required to for discussion of a matter relevant to the CCO.

Audit and Risk Committee

16 December 2014

ITEM TABLE OF CONTENTS PAGE

1 Apologies 7

2 Declaration of Interest 7

3 Confirmation of Minutes 7

4 Petitions 7

5 Public Input 7

6 Local Board Input 7

7 Extraordinary Business 7

8 Notices of Motion 8

9 Office of the Auditor-General 9

10 Briefing by Audit New Zealand on the Long-term Plan consultation document 11

11 Update on Financial Control interactions with Audit New Zealand during the last quarter 13

12 Auckland Council Group Pro Forma Financial Statements and Approval of Accounting Policies for 31 December 2014 15

13 Audit and Risk Committee Oversight of Council Controlled Organisation Risk 43

14 Update on Health and Safety Activities 49

15 Update of Risk Management Activities 53

16 Consideration of Extraordinary Items

PUBLIC EXCLUDED

17 Procedural Motion to Exclude the Public 63

C1 Update on Internal Audit Activities 63

C2 Update on Integrity and Investigation Activities 63

1 Apologies

Apologies from Mayor LCM Brown and Deputy Mayor PA Hulse have 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 Tuesday, 16 September 2014, 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 3.21 provides for Public Input. Applications to speak must be made to the Committee Secretary, in writing, no later than two (2) working days 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 3.22 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 two (2) days 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 3.9.14 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.”

8 Notices of Motion

At the close of the agenda no requests for notices of motion had been received.

Audit and Risk Committee

16 December 2014

Update on Financial Control interactions with Audit New Zealand during the last quarter

File No.: CP2014/27431

Purpose

1. This report summarises the significant work undertaken by the Financial Control Unit since September which involved working with Audit New Zealand.

Executive Summary

2. Auckland Council is working closely with Audit New Zealand to resolve issues raised in previous management reports and two new issues arising from the 2013/14 audit. In addition we are working together as the Council is continuing its implementation plan resulting from the adoption of the International Public Sector Accounting Standards (IPSAS).

Recommendation/s

That the Audit and Risk Committee:

a) receive the report.

Discussion

3. Following the completion of the audit of the 2013/14 Annual Report, we met with Audit New Zealand and agreed on the status of the prior year recommendations. As reported at the September Audit and Risk Committee there are 19 items which are in progress which need to be resolved. We are developing a programme of work to progress the issues identified.

We have held discussions with Audit New Zealand regarding the final management letter for the 2013/14 year and have seen an initial draft version of the letter outlining their findings. Two new items have been identified, management of software licences and the management of staff with high annual leave balances. We will work with Audit New Zealand to finalise the draft management report for us to provide our comments. Once the letter is finalised we will present it to the next Audit and Risk Committee meeting on 18 February 2015.

4. Financial Control have prepared consolidated financial information based on the first quarter results of the 2014/15 financial year. This financial information, which was the subject of an Audit New Zealand review, was supplied to the Auckland Council Treasury department for the offer document which supports the European Medium Term Notes comfort letter.

5. Audit New Zealand has also undertaken the first Interim Audit for the 2014/15 financial year and is in the process of completing the audit of the Long Term Plan consolidation document which is due to be adopted on 18 December.

6. Preparation for the half year report and audit review are underway, with the revised accounting policies and pro forum financial statements redrafted as required for the implementation of IPSAS.

7. Accounting policy papers on exchange/non exchange revenue, and related parties are in the process of being prepared and supplied to Audit New Zealand to support our interpretation of the new IPSAS.

8. Work continues on analysing several specific arrangements the Council has historically entered into to determine the impact of the IPSAS Service Concession Arrangement standard.

Consideration

Local Board Views and Implications

9. Local boards have not been consulted because the report deals primarily with internal management issues.

Maori Impact Statement

10. The report does not have any particular benefit or adverse effects on Maori.

General

11. Nil.

Implementation Issues

12. No issues.

Attachments

There are no attachments for this report.

Signatories

Author

Morna Macfarlane – Financial Compliance Manager

Authorisers

Kevin Ramsay - Chief Financial Officer

Grant Taylor - Governance Director

Audit and Risk Committee

16 December 2014

Auckland Council Group Pro Forma Financial Statements and Approval of Accounting Policies for 31 December 2014

File No.: CP2014/28309

Purpose

1. This report presents the pro forma financial statements as at 31 December 2014 for Auckland Council and group and the relevant accounting policies.

Executive Summary

2. The Audit and Risk Committee reviews the attached pro forma financial statements and approves the relevant changes in accounting policies for the purpose of the financial reporting for the six months ended 31 December 2014.

Recommendation/s

That the Audit and Risk Committee:

a) receive the draft pro forma financial statements.

b) approve the accounting policies contained within the pro forma financial statements for the preparation of 2015 half year Auckland Council and Group financial statements and delegate to Mr Roy Tiffin or Mr Paul Conder authority to approve any amendments resulting from consultation with Audit New Zealand.

Discussion

3. The 31 December 2014 pro forma financial statements and notes should be read in conjunction with 30 June 2014 annual report as it contains only significant changes from 30 June 2014.

4. The primary statements and certain notes contained in the 31 December 2014 pro forma financial statements have been amended to reflect the adoption of International Public Sector Accounting Standards (IPSAS) which came into effect on 1 July 2014.

5. The revised accounting policies and pro forma financial statements have been sent to Audit New Zealand after taking into consideration Audit New Zealand’s initial feedback on the treatment of exchange and non-exchange revenue transactions. Auckland Council is waiting for Audit New Zealand’s technical team to confirm whether they are comfortable with the revised proposed accounting policies and disclosures.

Consideration

Local Board Views and Implications

6. This report applies to the preparation of pro forma financial statements for the council and group. The views of local boards have not been sought.

Māori Impact Statement

7. The pro forma financial statements do not affect the achievement or reporting of Council’s contribution towards Māori outcomes.

General

8. There are no financial or resourcing issues arising from the adoption of this report.

Implementation Issues

9. There are no implementation issues.

Attachments

No.	Title	Page
a View	Pro forma 2015 Q2 Half Year Report	17

Signatories

Author

Francis Caetano - Group Financial Controller

Authorisers

Kevin Ramsay - Chief Financial Officer

Grant Taylor - Governance Director

Audit and Risk Committee

16 December 2014

Audit and Risk Committee Oversight of Council Controlled Organisation Risk

File No.: CP2014/27719

Purpose

1. To approve the recommendations and processes that ensures the Audit and Risk Committee has oversight of Auckland Council’s substantive Council Controlled Organisation’s (CCO) risks in relation to the Auckland Council Annual Report, and in compliance with the Audit and Risk Committee’s terms of reference.

Executive Summary

2. This report recommends the process for the reporting of risks of the substantive CCO’s to the Auckland Council’s Audit and Risk Committee.

Recommendation

That the Audit and Risk Committee:

a) request each substantive Council Controlled Organisation provide an Audit Summary Letter and associated actions/plans to resolve issues identified, to the Audit and Risk Committee at its September meeting, based on the key findings noted by the CCO’s auditor.

b) note each substantive Council Controlled Organisation will provide regular reporting to the Council Controlled Organisation Governance and Monitoring Committee as part of the regular quarterly report and include the following risk information:

(i) how key risks are identified, assessed and managed

(ii) an update on the approach to risk management, internal audit and external audit

(iii) progress on current internal and external audit issues

(iv) any financial impacts that will affect the council group

(v) any key risks that are of a senior management or governance level that could impact on the wellbeing or reputation of the Council Controlled Organisation or Auckland Council

c) note a report will be provided to the Audit and Risk Committee summarising the risk issues identified by the substantive Council Controlled Organisations in their quarterly reports to the CCO Governance and Monitoring Committee.

Discussion

CCO boards and risk management

3. Risk management is a key responsibility of a board of directors. In putting in place mechanisms to increase its oversight of risk and assurance, the council must ensure that it does not undermine the role of the boards nor diminish the boards’ responsibility. Provided the committee maintains an oversight of risk rather than management of CCO risk, this situation should not arise.

Audit & Risk Committee decisions

4. At the 16 September 2014 Audit and Risk Committee meeting the committee agreed that a long-term solution covering nature, scope and timing of risk reporting by CCOs would be developed and implemented for the 2015 reporting programme.

5. The Audit and Risk Committee is asking CCOs to provide evidence of a robust process of risk identification and analysis ensuring risk is appropriately addressed at a governance level.

6. The following processes are proposed to assist the committee in exercising active oversight and accountability of CCOs in an integrated and systematic way.

Audit Summary Letter

7. An Audit Summary Letter is to be provided to the council’s Audit and Risk Committee outlining the key findings and how the CCO proposes to address the findings. The key findings could be those points that the Auditor considers essential and necessary management improvements.

8. The Audit Summary Letter would preferably be signed by the Chair of the CCO Audit and Risk Committee (or equivalent).

9. An example of the Audit Summary Letter has been previously supplied by Watercare Services Limited and is attached at Appendix A. The Audit and Risk Committee showed a preference for this format of risk reporting.

Quarterly Reporting : CCO Governance and Monitoring Committee

10. As part of the Statement of Intent quarterly reporting programme, CCOs will be required to provide additional risk information as part of their quarterly reporting requirements.

11. Each CCO will be asked to provide the following information:

(i) how key risks are identified, assessed and managed

(ii) an update on the approach to risk management, internal audit and external audit

(iii) progress on the current internal and external audit issues

(iv) any financial impacts that will affect the council group

(v) any key risks that are of a senior management or governance level that could impact on the wellbeing or reputation of the CCO or Auckland Council

12. A report will be provided to the Audit and Risk Committee summarising the risk issues identified by the substantive Council Controlled Organisations in their quarterly reports to the CCO Governance and Monitoring committee.

Disclosure Statement

13. Auckland Council currently has a number of bonds quoted on the New Zealand Debt Exchange as well as the Singapore and Swiss Exchanges. As a result the council is subject to continuous disclosure obligations which it must comply with under the NZX Main Board and Debt Market Listing Rules (Listing Rules) and the Financial Markets Conduct Act 2013 (FMCA). Similar obligations apply to the Singapore and Swiss exchanges.

14. Timely disclosure of material information is essential in maintaining the integrity of the market and to ensure the market is informed of relevant information in a timely manner so that investors can make informed investment decisions. Timely disclosure promotes a fair, orderly and transparent market.

15. Council’s continuous disclosure obligations under the Listing Rules require that once the council becomes aware of any material information it must immediately release that material information to the NZX unless certain permitted exceptions apply. The consequences of the council failing to comply with its continuous disclosure obligations may attract disciplinary action from the NZX. Such failure will also be a contravention of the FMCA which may give rise to civil liability for council and for its officers.

16. In order to maintain council’s compliance with FMCA and Listing Rules CCOs must advise the council of any material information that could affect council’s ability to maintain compliance with its continuous disclosure obligations.

17. Council’s legal department are developing a Disclosure Register and implementation of this process will include the CCOs. The timeframe for this work to be completed is in the first quarter of 2015.

Consideration

Local Board Views and Implications

18. The matters raised in this report relate to CCO accountability and governance which is a Governing Body function.

Māori Impact Statement

19. Oversight of CCO risk by the council’s Audit and Risk Committee has no specific implications for Māori wellbeing and does not raise any matters requiring iwi consultation.

Implementation Issues

20. Internal Audit will be responsible for ensuring compliance with the approved recommendations outlining risk reporting by CCOs.

Attachments

No.	Title	Page
a View	Watercare Services Limited - Audit Summary Letter	47

Signatories

Author

Josie Meuli - Senior Advisor

Authorisers

John Bishop - Treasurer and Manager CCO Governance & External Partnerships

Kevin Ramsay - Chief Financial Officer

Grant Taylor - Governance Director

Audit and Risk Committee

16 December 2014

Update on Health and Safety Activities

File No.: CP2014/28649

Purpose

1. This report summarises the activities undertaken by the Health and Safety Department to prepare for the proposed Health and Safety Legislation to be enacted in late 2015, and as follow-up from our two yearly Accident Compensation Corporation (ACC) audit.

Executive Summary

2. The continued health and safety of our employees, contractors and visitors is one of our highest risks and therefore its management is a high priority for the organisation. The purpose of this report is to advise the committee of the key activities that have been completed and those that are underway to improve the practices and culture of the organisation to meet this challenge.

Recommendation

That the Audit and Risk Committee:

a) receive this update on Health and Safety activities report.

Discussion

3. Health and Safety Risk

As an organisation we understand that many of the activities our employees undertake pose a potential risk to their health and safety, and at times to the health and safety of visitors to our sites. We manage those risks by using traditional health and safety management practices such as identifying hazards and investigating incidents. This has led to a significant drop in Lost Time Injury Frequency Rate (LTIFR, a common measure of safety performance). LTIFR dropped from 15.4 in October 2012 to 7.95 in October 2013 to 5.1 in October 2014, an outstanding improvement in performance.

4. Change in Legislation

New Zealand will have new Health and Safety Legislation in 2015, as a result of the Royal Commission into health and safety practices in New Zealand. The legislation has not been enacted yet, but the changes are likely to place significant additional responsibilities on organisations to improve their health and safety management. Under this legislation it is likely that elected members will have the due diligence obligations of an officer but will not be subject to prosecution, if they fail to meet those obligations.

Auckland Council is preparing to meet the requirements of the proposed legislation by;

· Conducting a compliance review – a check of our current system against the new legislation (planned for April 2015 when the legislation will be finalised). There will be actions from the review and these will be planned and implemented before the Act is enforced in September 2015.

Preparing to meet the officer’s due diligence requirements – there are six requirements specifically for officers (likely to be the Executive Lead Team) under the proposed legislation, mainly around positive due diligence. That is, officers are required to understand what risks there are in the business and how those risks are managed. They are expected to get first-hand knowledge of those risks and health and safety management techniques.

5. Accident Compensation Corporation Workplace Safety Management Practices (ACC WSMP) Audit

ACC conducted the two yearly audit of the health and safety management system at council and CCOs in October 2014. The audit found some quality practices in the organization with five elements judged to be at Tertiary (best) status. However there was insufficient evidence to maintain our Tertiary experience rating with three elements judged to be at Secondary status. ACC therefore confirmed in November that council and CCOs rating has dropped to Secondary and this affects our levy rate, adding an estimated $75,000 in ACC cost per year at current staffing levels.

The Health and Safety team has been very successful at returning people to meaningful work when they are injured in the workplace. ACC sets a part of the levy that workplaces pay based on rehabilitation performance. Auckland Council’s good performance has resulted in a lower calculated levy from ACC and a saving of around $40,000 in ACC cost per year.

The drop in rating from ACC despite good performance in rehabilitation and Lost Time Injury Frequency Rate is consistent with rising regulatory expectations of performance in Health and Safety. Auckland Council will work quickly to use the findings of the audit, and the recommendations for improvement to inform all our improvement programmes.

6. Changes in Operating Practices

The Health and Safety team has been working collaboratively with representatives of business leaders, team members, PSA organisers and delegates to understand and develop innovative approaches to better manage some of our key risks. Key areas of focus are:

· Working alone

· Contractor management

· Setting standards

· Reporting incidents and accidents

· Safety sensitive roles

The recommendations from the working groups focusing on the above areas will be combined with the changes council needs to make to be compliant with the new legislation. The combined programme of work will then be delivered to all teams in council in the first six months of 2015 and the improvements measured with follow up actions agreed and implemented.

Consideration

Local Board Views and Implications

7. Local boards have not been consulted because the report primarily deals with internal management issues.

Māori Impact Statement

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

General

9. There are no general issues related to this report

Implementation Issues

10. Implementation of Health and Safety Transformation is being planned so that council improves against;

· Some previously identified risk areas (Health and Safety Transformation program)

· ACC Audit outcomes

· Legislation changes

Attachments

There are no attachments for this report.

Signatories

Author

Mark Lipman - Head of Health and Safety

Authorisers

Alan Brookbanks – People & Capability Director

Grant Taylor - Governance Director

Audit and Risk Committee

16 December 2014

Update of Risk Management Activities

File No.: CP2014/28656

Purpose

1. This report summarises the activities undertaken by the Risk Management department since the last report to the Audit and Risk Committee in September 2014.

Executive Summary

2. The Risk Management department continued to implement the Enterprise Risk Management Policy and Framework as per the Enterprise Risk Management Strategic Plan 2012-17.

Recommendation

That the Audit and Risk Committee:

a) receive the Update on Risk Management Activities report.

Discussion

3. Appointment of Head of Risk

Council established the Head of Risk position to lead the ongoing development and implementation of the council’s risk management framework, focusing on building the risk culture. The appointment is now finalised with Jazz Singh being appointed to the position, He was previously Manager, Property and Commercial within council’s Legal Services and will commence in the role from 19 January 2015. Risk Management portfolio will also report to the General Counsel, Katherine Anderson from that date onwards.

4. Risk Report

The top risks were finalised and agreed by the Executive Leadership Team (ELT). The risk owners continue to work on the risk treatment plans to further improve risk management processes at council. Auckland Council Risk Report is included as Attachment A.

5. Organisation-wide Risk Registers

Risk Management is in the process of automating the risk registers from manual-based Excel spreadsheets to using an existing automated system, Hyperion in a step towards getting a longer-term council-wide risk management tool/system. This would allow Risk Management to have single point visibility and adequate audit trails for the mitigation of risks identified.

6. Operational Risk

Key operational risks are reported to the ELT in the monthly performance report. Management are continuing to focus on key risks and improving the risk culture across council. Auckland Council is on a journey of creating a high performing organisation and uses the “Balanced Scorecard” model with key focus areas being “Customer and Community, “People”, “Financial” and “Productivity”. Specific measures were defined and approved by ELT.

7. Targeted Risk Review

The Information Services (IS) Risk Review was completed. There were a total of 16 strategic and operational level risks identified with clear accountabilities and risk treatments agreed with the risk owners (IS Lead Team). The IS Risk Management Framework was also revised with clear tolerance levels defined. In addition, the framework defined the responsibility of the Head of IS to escalate high and critical risks to the ELT, with an appropriate risk mitigation plan for the lowering of the risk exposure level. Subsequent to the review, IS also recruited a Senior IS Risk Advisor to ensure the risks are managed appropriately.

8. Continuous Disclosure Policy

Planning is underway to establish a continuous disclosure committee of staff related to council’s bond programme with the NZX. Continuous disclosure is a requirement of the NZX Main Board and Debt Market Listing Rules, as well as the Financial Markets Conduct Act 2013. The committee membership and policy, as well as quarterly reporting programme, will be reported to the next meeting of the Audit and Risk Committee in 2015.

9. Enterprise Risk Management Framework

The ERM Framework identifies risk categories with relevant risk tolerance limits. To ensure adequate mitigation is in place, specific risk frameworks are being continually developed in high risk/strategic areas to get greater coverage from a risk management perspective. The following are being continually improved:

o Programme and Project Risk Framework – The Project Management Framework at council provides a standard approach of managing projects with clear gateway, performance monitoring and progress reporting, project hub, roles and responsibilities, tools and training, guidelines and collaboration. Within this framework, risk management was clearly integrated within the processes and is being continually improved.

o Liability Risk Framework – to ensure that council minimizes potential risk exposures around financial liability, through contractual arrangements, health and safety and other regulatory or compliance requirements, the team continues to work with the relevant areas, as and when required. Risk Management continues to collaborate with Procurement, Legal Services and Insurance to bring consistency in managing Professional Indemnity and Public Liability insurance requirements across council. In addition, the transformation of the health and safety programme continues.

o Treasury Risk Framework – quarterly and ad hoc meetings, as appropriate, are held with the Treasury team to review treasury risks, potential non-compliance to policy and emerging risks in the debt markets.

o Asset Management Planning – Council is exposed to considerable risks due to the scale of the assets it owns and manages. Risk Management is working closely with the Asset Management Planning team to further embed risk management requirements. A steering committee was established and Risk Management continues to provide risk guidance. This is currently being audited by Audit NZ.

o Fraud Risk Framework – we continue to work closely with the Integrity and Investigations Manager to minimize fraud risks and assist as and when required.

10. Risk Management Workshop

The Risk Management team continues to provide guidance to management and business areas. Workshops were completed for Brands and Channel (Communication and Engagement) and Parks, Sports and Recreation (Operations).

11. CCO Engagement

There are plans for greater engagement with CCO’s next year.

12. Project Risk Management

Risk Management provides advice and support to the various project teams by ensuring risks are identified, documented and monitored as part of the programme and Project Risk Framework. No new projects were included.

The projects that Risk Management is involved in are:

o NewCore - currently under review, and proposed Programme Governance Structure, with clearer terms of reference and responsibilities defined.

o Workplace Strategy

o The Southern Initiative - currently under review

o Payment Card Industry Data Security Standards (PCIDSS) – ongoing advice being provided

o Waiheke Library - ongoing advice being provided

o Lopdell House and Gallery Refurbishment - completed

o Project Connect - completed

o NorSGa – no advice provided

o Quay Street Seawall – no advice provided

o Auckland Harbour Bridge SkyPath - ongoing advice being provided

o Revaluation and Rates - completed

Consideration

Local Board Views and Implications

13. Local boards have not been consulted because the report primarily deals with internal management issues.

Māori Impact Statement

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

General

15. None

Implementation Issues

16. None

Attachments

No.	Title	Page
a View	Auckland Council Risk Report December 2014	57

Signatories

Author

Aashmita Naikar - Risk Manager

Authorisers

Alan Brookbanks – People & Capability Director

Grant Taylor - Governance Director

Audit and Risk Committee

16 December 2014

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 Update on Internal Audit Activities

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 financial and operational information and details of Internal Audit activity 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.

C2 Update on Integrity and Investigation Activities

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 6.

s6(a) - The making available of the information would be likely to prejudice the maintenance of the law, including the prevention, investigation, and detection of offences and the right to a fair trial.

In particular, the report contains financial and operational information regarding investigation and other activity, which if released may compromise the effective delivery of our integrity and investigative 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 6.

Author	Mike Giddey - Democracy Advisor
Authoriser	Grant Taylor - Governance Director