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.
- Review risk management reports identifying new and / or
emerging risks, and any subsequent changes to the ERM “Top
Risk” register.
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)
- Review and monitor management’s responsiveness to
the findings and recommendations – enquiring into the reasons that
any recommendation is not acted upon.
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.
- Review reports from the Risk, Internal Audit, Integrity
and Investigations, external audit and management related to whistle
blower, ethics, bribery and fraud related incidents.
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
- significant adjustments resulting from the audit.
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.
- Where required, the chair may ask a senior representative
of the Office of the Auditor General to attend the committee meetings to
discuss the office’s plans, findings and other matters of mutual
interest.
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.
At the close of
the agenda no apologies had 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 Wednesday, 6 December 2017, 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.”
8 Notices
of Motion
There were no
notices of motion.
