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

 

Date:

Time:

Meeting Room:

Venue:

 

Monday, 22 February 2021

2.00pm

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

Cr Daniel Newman, JP

 

Members

Deputy Mayor Cr Bill Cashmore

 

 

Paul Conder

 

 

Cr Shane Henderson

 

 

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

Kaitohutohu Mana Whakahaere / Governance Advisor

 

17 February 2021

 

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

·         health, safety and wellbeing

·         business continuity and resilience

·         integrity and investigations

·         monitoring of compliance with laws and regulations

·         significant projects, programmes of work and procurement 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 the council’s CCOs and the council 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 other than those in these terms of reference. 

 

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.

 

Assurance

 

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

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

·         Review the co-ordination between the risk and assurance 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 assurance 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 Assurance Strategy, including the fraud and integrity aspects, including a detailed work programme.

·         Review annually the ‘Speak Up’ and 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, Assurance, 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 Long-term Plan, 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 way 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:

o   the nature, scope and fees of the external audit

o   areas of audit focus

o   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 Assurance and the Chief Risk Officer are responsible for monitoring CCO risk and internal audit strategies with respect to risks and CCO 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

22 February 2021

 

ITEM   TABLE OF CONTENTS                                                                                         PAGE

1          Apologies                                                                                                                        9

2          Declaration of Interest                                                                                                   9

3          Confirmation of Minutes                                                                                               9

4          Petitions                                                                                                                          9  

5          Public Input                                                                                                                    9

6          Local Board Input                                                                                                          9

7          Extraordinary Business                                                                                              10

8          Forward Work Programme                                                                                         11

9          Enterprise Risk Update - February 2021                                                                   21

10        Auckland Council's health, safety and wellbeing (HSW) performance (Covering report)                                                                                                                            29

11        Insurance Update                                                                                                         31

12        Treaty Audit Monitoring Update                                                                                 41

13        Final Office of the Auditor-General report to management for the year ended 30 June 2020                                                                                                                      49

14        Approval of the draft Audit New Zealand audit plan for the year ended 30 June 2021                                                                                                                                       97

15        Significant forecasting assumptions update for 10-year Budget 2021-2031 (Covering report)                                                                                                                          143

16        Consideration of Extraordinary Items

PUBLIC EXCLUDED

17        Procedural Motion to Exclude the Public                                                               145

C1       CONFIDENTIAL: Council-controlled organisations' quarterly risk update - February 2021                                                                                                                             145

C2       CONFIDENTIAL: 31 December 2020 half year results announcement for the NZX and Interim Report                                                                                                            145

C3       CONFIDENTIAL: Assurance Services Activity Update                                         146

C4       CONFIDENTIAL: Office of the Auditor-General and Audit New Zealand briefing 146


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 Tuesday, 8 December 2020 and the extraordinary minutes of its meeting, held on Tuesday, 9 February 2021, including the confidential section, as true and correct records.

 

 

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

22 February 2021

 

Forward Work Programme

File No.: CP2021/00538

 

  

 

Te take mō te pūrongo

Purpose of the report

1.       To review and approve remaining elements of the Audit and Risk Committee’s three-year forward work programme (Attachment A).

Whakarāpopototanga matua

Executive summary

2.       In accordance with good practice, the committee reviews the forward work programme at each meeting to ensure it can be adapted to council’s risk profile changes and that it remains relevant to the needs of the committee.

3.       The following changes have been made:

·    an additional meeting of the committee has been scheduled for 22 June 2021 to review the process and risks relating to the 10-year Budget 2021-2031 (long-term plan)

·    the item on the preparation for the 2022 Independent Maori Statutory Board’s Te Tiriti o Waitangi audit has been deferred

·    items relating to updates on risks relating to the America’s Cup event have been removed from May 2021 onwards given the event will have been delivered.

4.       It is intended to incorporate regular reporting on Enterprise Risk Management for Ports of Auckland Limited. It is envisaged the cycle of reporting would be the same as that applied to council-controlled organisations. The timing of this reporting has yet to be confirmed.

 

 

Ngā tūtohunga

Recommendation/s

That the Audit and Risk Committee:

a)      approve the deferral of the item relating to the preparation of the 2022 Te Tiriti o Waitangi audit

b)      note the additional meeting scheduled for 22 June 2021 to review the key controls and risks relating to the 10-year Budget 2021-2031 (long-term plan)

c)      note the removal of the items relating to the Americas Cup event from May 2021

d)      note the intention to incorporate into the work programme regular reporting on Enterprise Risk Management with respect to Ports of Auckland Limited.

 


 

 

Ngā tāpirihanga

Attachments

No.

Title

Page

a

Forward Work Programme

13

      

Ngā kaihaina

Signatories

Author

Mark Maloney - General Manager Risk and Assurance

Authoriser

Phil Wilson – Director, Governance & CCO Partnerships

 


Audit and Risk Committee

22 February 2021

 

 

 

 

 

Komiti Tātari me te Mātai Raru Tūpono / Audit and Risk Committee
Forward Work Programme 2020-2022

This committee assists and advises the Governing Body in discharging its responsibility and ownership of governance, risk management and internal control across Auckland Council group. 

Responsibilities include reviewing the effectiveness of enterprise risk management, internal and external audit assurance, health safety and wellbeing, business continuity and resilience, integrity and investigations.  The Committee monitors compliance, risk management in significant projects and programmes of work and procurements and has oversight of risk management and assurance of CCOs, the preparation of the LTP, Annual Report and other statutory financial reports.
Full terms of reference can be found
here.

 

 

Area of work and lead

 

Expected reporting 2020

24 Feb

26 May

24 Aug

15 Sep

14 October (additional remote meeting added for Annual Report 8.30am – 10am)

8 Dec

Audit and Risk Committee

Head of Assurance Services

Work programme update

Link to decision

Work programme update

Link to decision

Work programme update

Link to decision

Work programme update

Link to decision

 

Work programme update

Link to decision

Committee’s Annual performance report (moved from September)

Link to decision

Assurance

Head of Assurance Services – Assurance Services Department

Building and resource consents assurance plan update

Link to decision

 

Building and resource consents performance and improvement plan update (Regulatory division)

Link to decision

Assurance Services Strategy and activities update (fraud and integrity, elected members, internal audits and reviews, speak up)

Link to decision

 

Holidays Act project (refer Assurance Services Update report)

 

Building and resource consents assurance plan update

Link to decision

 

Building and resource consents performance and improvement plan update (Regulatory division)

Link to decision

 

Audit Programme reporting – updated plan and audits completed

 

Covid-19 Refocussed Audit Plan report

Building and resource consents assurance plan update

Link to decision

 

CCO Review update

 

Covid-19 Refocussed Audit Plan report

Link to decision - confidential

 

Assurance Services Strategy and activities update (fraud and integrity, elected members, internal audits and reviews, speak up)

Link to decision

Audit Programme reporting – updated plan and audits completed

Link to decision - confidential

Covid-19 Refocussed Audit Plan report

 

 

 

 

 

 

 

 

 

 

 

Covid-19 Refocussed Audit Plan report

Link to decision - confidential

 

 

 

Independent Maori Statutory Board - Treaty Audit

Head of Assurance and GM Maori Outcomes and Relationships

Treaty Audit Monitoring update

Link to decision

 

Treaty Audit Monitoring update

Link to decision

 

Performance Measurement Framework and Māori Responsiveness Planning

Link to decision

 

 

 

Enterprise Risk

Chief Risk Officer – Risk and Insurance Department

Risk Update Link to decision

Risk Update – top risk

Link to decision

 

ERM Framework

Review and Refresh Risk Appetite Statement

 

Enterprise Risk Update

Link to decision

 

 

Enterprise Risk Update

Link to decision

CCO Risk management

Facilitated by Risk and Insurance Department

CCO quarterly risk report

Link to decision

 

Attendance by Panuku

 

 

CCO Covid19 Risk Update

CCO quarterly risk report

Link to decision

 

 

CCO quarterly risk report

Attendance by Watercare and Regional Facilities Auckland

Link to decision

 

 

CCO annual reports on risk (matters raised through annual audit process and summary of any significant findings raised by auditors)

Attendance by Watercare, ATEED, Auckland Transport, RFA, Panuku

Link to decision - confidential

 

CCO Covid19 Risk Update

CCO quarterly risk report

Attendance by Auckland Unlimited

Link to decision - confidential

 

Auckland Council partner/ shareholder risk management

Director Infrastructure and Environmental Services & CCO/ External Partnerships Dept

America’s Cup 36

Link to decision

America’s Cup 36 Covid-19 Impact update (refer Covid-19 Risk Update above)

 

City Rail Link

Link to decision

America’s Cup 36

Link to decision

City Rail Link

Link to decision

 

America’s Cup 36

Link to decision

Health, Safety and Wellbeing

Health, Safety and wellbeing update

Link to decision

Health, Safety and wellbeing update

(Refer Covid-19 Risk Update above)

Health, Safety and Wellbeing update

Deferred to September meeting

Health, Safety and Wellbeing update

Link to decision

 

Health, Safety and wellbeing update

Link to decision

Legal Risk

General Counsel – Legal & Risk Dept

 

Legal Risk report

Link to decision

 

Legal Risk report

Deferred to December meeting

 

Legal Risk report

Link to decision - confidential

Insurance

Manager Insurance - Risk and Insurance Dept

Insurance risk profiling

Indicative insurance procurement strategy

Link to decision

Indicative Insurance Renewal Report

Link to decision

Update to Committee post placement of Insurance Programme

Link to decision

 

 

Insurance Strategy 2021-23 Update

Link to decision

Interim Report

Group Financial Controller

 

31 December 2019 Interim Report and NZX Announcement clearance

Link to decision

Audit New Zealand Review engagement management report 31 December 2019

 

Interim Audit Management Report

Link to decision

 

 

Approval of the draft Audit New Zealand Interim Review Engagement letter for the six months ending 31 December

Link to decision

Preparation of the interim report and NZX release for the six months ending 31 December 2020 

Link to decision

Link to decision - confidential

Proforma interim financial statements and accounting policies 31 December 2020

Link to decision - confidential

Annual Report

Group Financial Controller

30 June 2020 Arrangements (extended audit plan)

Link to decision

NZX Announcement 30 June 2020 / Annual Report 30 June 2020 update for committee

 

Proforma Annual Report 30 June 2020 (financial statements and accounting policies)

Link to decision

 

Audit New Zealand Interim audit management report 30 June 2020

Link to decision

Update on process

Link to decision - Confidential

NZX Announcement 2020

Annual Report 30 June 2020 update for committee

Link to decision - confidential

 

Annual Report for recommending to Governing Body

Link to decision

Link to decision - confidential

 

 

Annual Green Bond Report

 

Process for Annual Green Bond Report 30 June 2020.

Link to decision

 

Annual Green Bonds Report 30 June 2020.

Link to decision - confidential

 

 

Other reports

 

 

 

Review of property rationalisation process

Link to decision

 

 

Long-Term Plan 2021/2031

Annual Plan

GM Financial Strategy and Planning

 

2021 Annual Plan (Refer Covid-19 Risk Update)

Audit NZ Arrangements Letter – Audit of LTP

Risk Management and Assurance Approach

Link to decision

Audit NZ Arrangement letter   - Audit of Long-Term Plan - draft

Link to decision

 

Audit NZ arrangement letter Audit of Long-Term Plan.

LTP forecasting assumptions

Link to decision

2021/22 Annual Plan (draft) – covered at the 24 August meeting in the Risk Management and Assurance Approach report

External Audit

Office of Auditor-General (OAG)

Briefing paper provided

Link to decision

Briefing paper provided

Link to decision

Briefing paper provided

Link to decision - confidential

Briefing paper provided

Link to decision - confidential

Briefing paper provided

Link to decision - confidential

Briefing paper provided

Link to decision - confidential

 

 

 

Area of work and lead

 

Expected reporting 2021

22 Feb

18 May

22 June (extraordinary meeting)

23 Aug

13 Sep

7 Dec

Audit and Risk Committee

GM Risk and Assurance

Work programme

Work programme

 

Work programme

Work programme

Committee’s Annual performance report

Work programme

 

Assurance

GM Risk and Assurance

Assurance Services Strategy and activities update (fraud and integrity, elected members, internal audits and reviews, speak up)

Audit Programme reporting – updated plan and audits completed

 

 

 

Assurance Services Strategy and activities update (fraud and integrity, elected members, internal audits and reviews, speak up)

Audit Programme reporting – updated plan and audits completed

 

 

Assurance Services Strategy and activities update (fraud and integrity, elected members, internal audits and reviews, speak up)

Audit Programme reporting – updated plan and audits completed

 

Independent Maori Statutory Board - Treaty Audit

GM Risk and Assurance

Treaty Audit Monitoring update

Preparations for Independent Maori Statutory Board upcoming 2022 Te Tiriti o Waitangi audit.

 

 

Treaty Audit Monitoring update

 

Preparations for Independent Maori Statutory Board upcoming 2022 Te Tiriti o Waitangi Audit

Enterprise Risk

Risk Services

Enterprise Risk Update

Enterprise Risk Update

 

 

Enterprise Risk Update

 

CCO Risk management

Facilitated by Risk Services

CCO quarterly risk report

Attendance by Auckland Transport

CCO quarterly risk report

Attendance by Panuku

 

CCO quarterly risk report

Attendance by Auckland Unlimited

CCO annual reports on risk (matters raised through annual audit process and summary of any significant findings raised by auditors)

Attendance by Watercare, Auckland Transport, Auckland Unlimited Panuku

CCO quarterly risk report

Attendance by Watercare

Auckland Council partner/ shareholder risk management

Director Infrastructure and Environmental Services & CCO/ External Partnerships Dept

America’s Cup 36 (included in Enterprise Risk Update)

City Rail Link

 

 

City Rail Link

 

Health, Safety and Wellbeing

Head of Health, Safety and Wellbeing

 

Health, safety and wellbeing update

Health, safety and wellbeing update

 

Health, safety and wellbeing update

 

Health, safety and wellbeing update

Legal Risk

General Counsel

 

Legal Risk report

 

 

Legal Risk report

 

Insurance

Manager Insurance - Risk and Insurance Dept

Update on insurance activities

Insurance Strategy 2021-23

Indicative Insurance Renewal Report

 

Update to Committee post placement of Insurance Programme

 

 

 

Interim Report

Group Financial Controller

 

31 December 2020 Interim Report and NZX Announcement clearance

Audit New Zealand Review engagement management report 31 December 2020

 

 

 

Review arrangements 31 December 2021

31 December 2021 Interim Financial Statements & NZX announcement Update

Proforma interim financial statements and accounting policies 31 December 2021

Annual Report

Group Financial Controller

30 June 2021 Arrangements (extended audit plan)

Audit New Zealand final audit management report 30 June 2020

NZX Announcement 30 June 2021 / Annual Report 30 June 2022 update for committee

Proforma Annual Report 30 June 2021 (financial statements and accounting policies)

 

 

NZX Announcement 2021/ Annual Report 30 June 2021 update for committee

Audit New Zealand Interim audit management report 30 June 2021

 

30 June 2021 Annual Report

 

30 June 2022 Arrangements (extended audit plan)

Audit New Zealand final audit management report 30 June 2021

 

Annual Green Bond Report

 

Process for Annual Green Bond Report 30 June 2021.

 

 

 

. Annual Green Bonds Report 30 June 2021

 

Long Term Plan 2021/2031

Annual Plan

GM Financial Strategy and Planning

Consultation Document and supporting information – key controls and risks

 

 

LTP Key controls and risks

 

 

2021-2031 LTP (draft)

External Audit

Office of Auditor-General (OAG)

Briefing paper provided

Briefing paper provided

 

Briefing paper provided

Briefing paper provided

Briefing paper provided

 

Workshops

The Audit and Risk Committee holds workshops on matters where a background briefing/ more informal discussion and opportunity for questions from the committee is necessary to perform its role and responsibilities.

Workshops are not used to make decisions - that is for formal committee or Governing Body Meetings. Workshop material will be appended to a summary of information items in the next committee meeting, unless it has been clearly marked as confidential.

The following topics have been identified as proposed workshops necessary to discharge the Committee’s duties.  Workshops will be scheduled over the three-year programme based on strategic priorities, risk and time available.  Additional topics may be added if circumstances change or require a topic to be the subject of a workshop.

The workshop schedule is currently under review due to the “Top Risk” refresh.


 

Komiti Tātari me te Mātai Raru Tūpono / Audit and Risk Committee
Forward Work Programme 2021-2022

This committee assists and advises the Governing Body in discharging its responsibility and ownership of governance, risk management and internal control across Auckland Council group. 

Responsibilities include reviewing the effectiveness of enterprise risk management, internal and external audit assurance, health safety and wellbeing, business continuity and resilience, integrity and investigations.  The Committee monitors compliance, risk management in significant projects and programmes of work and procurements and has oversight of risk management and assurance of CCOs, the preparation of the LTP, Annual Report and other statutory financial reports.
Full terms of reference can be found
here.

 

 

 

Area of work and lead

Expected reporting 2022 (dates TBC)

Feb

May

Aug

Sep

Dec 7

Audit and Risk Committee

Head of Assurance Services

Work programme

Work programme

Work programme

Work programme

Committee’s Annual performance report

Work programme

 

Assurance

GM Risk and Assurance

 

Assurance Services Strategy and activities update (fraud and integrity, elected members, internal audits and reviews, speak up)

Audit Programme reporting – updated plan and audits completed

 

 

Assurance Services Strategy and activities update (fraud and integrity, elected members, internal audits and reviews, speak up)

Audit Programme reporting – updated plan and audits completed

 

 

Independent Maori Statutory Board - Treaty Audit

GM Risk and Assurance

Treaty Audit Monitoring update

 

Treaty Audit Monitoring update

 

Preparations for Independent Maori Statutory Board upcoming 2022 Te Tiriti o Waitangi Audit

Enterprise Risk

Risk Services

Enterprise Risk Update

 

 

Enterprise Risk Update

 

 

Enterprise Risk Update

 

CCO Risk management

Risk Services

CCO quarterly risk report

Attendance by Auckland Transport

CCO quarterly risk report

Attendance by Panuku

CCO quarterly risk report

Attendance by Auckland Unlimited

CCO annual reports on risk (matters raised through annual audit process and summary of any significant findings raised by auditors)

Attendance by Watercare, Auckland Transport, Auckland Unlimited

CCO quarterly risk report

Attendance by Watercare

Auckland Council partner/ shareholder risk management

Director Infrastructure and Environmental Services & CCO/ External Partnerships Dept

 

City Rail Link

 

City Rail Link

 

Health, Safety and Wellbeing

Head of Health, Safety and Wellbeing

 

Health, safety and wellbeing update

Health, safety and wellbeing update

Health, safety and wellbeing update

 

Health, safety and wellbeing update

Legal Risk

General Counsel

 

Legal Risk report

 

Legal Risk report

 

Insurance

Manager Insurance - Risk and Insurance Dept

Update on insurance activities

Indicative Insurance Renewal Report

Update to Committee post placement of Insurance Programme

 

 

 

Interim Report

Group Financial Controller

 

31 December 2021 Interim Report NZX Announcement clearance

Audit New Zealand Review engagement management report 31 December 2021

 

 

Review arrangements 31 December 2022

31 December 2022 Interim Financial Statements & NZX Announcement Update

Proforma interim financial statements and accounting policies 31 December 2022

 

Annual Report

Group Financial Controller

 

NZX Announcement 30 June 2022 / Annual Report 30 June 2022 update for committee

Proforma Annual Report 30 June 2022 (financial statements and accounting policies)

NZX Announcement 2022/ Annual Report 30 June 2022 update for committee

Audit New Zealand Interim audit management report 30 June 2022

 

30 June 2022 Annual Report

Audit New Zealand Audit Engagement and Audit Proposal letters for 2023, 2024 and 2025

30 June 2023 Arrangements (extended audit plan)

Audit New Zealand final audit management report 30 June 2022

Proforma interim financial statements and accounting policies 31 December 2022

Annual Green Bond Report

 

Process for Annual Green Bond Report 30 June 2022.

 

 

Annual Green Bonds Report 30 June 2022.

 

Long Term Plan 2021/2031

Annual Plan

GM Financial Strategy and Planning

 

Audit New Zealand final 2021 LTP amendment management report

 

 

2023/24 Annual Plan (draft)

External Audit

Office of Auditor-General (OAG)

Briefing paper provided

Briefing paper provided

Briefing paper provided

Briefing paper provided

Briefing paper provided

 

 

 

 

 

 

 

 



Audit and Risk Committee

22 February 2021

 

Enterprise Risk Update - February 2021

File No.: CP2021/00383

 

  

 

Te take mō te pūrongo

Purpose of the report

1.       To update the Audit and Risk Committee on enterprise risk management activities at Auckland Council for the period December 2020 - January 2021.

Whakarāpopototanga matua

Executive summary

Auckland Council Top Risk Reset progress update

 

2.       Auckland Council’s top risks have been reviewed and reset to reflect the changing risk environment following COVID-19 events and to align with Our Strategy 2022 Kia Manawaroa Tātou and Our Charter Tā tātou kawenata. Eleven top risk and opportunities areas, summarised in Attachment A, have been identified. 

3.       The work to assess and evaluate the top risks is ongoing and good progress has been made working with nominated Executive Leadership Team (ELT) sponsors to refine and assess the risk, potential drivers, impacts, current and proposed mitigations and controls in preparation for reporting back to the ELT for review and approval.

4.       A completed detailed risk assessment for each risk will be reported at the next Audit and Risk Committee in May 2021.

Risk Champions programme – risk kōrero

5.       As part of developing risk maturity and maintaining effective risk management practice across the enterprise, over 50 risk champions across the Auckland Council group joined a risk kōrero on 19 January 2021.

6.       The theme was how to effectively integrate risk management into everything we do. Chief Executive Jim Stabback provided risk insights to reinforce the importance of good, embedded risk management. The refreshed top risks were also discussed so they can be cascaded through all division and departmental risk champions. 

7.       A refreshed programme for risk champions forums is being developed, with the next kōrero scheduled in April 2021.

COVID-19 pandemic update - resurgence readiness

8.       Auckland Council remains vigilant and ready to respond to any change in requirements due to a resurgence of the COVID-19 pandemic in New Zealand. 

9.       In the last quarter, the risk team has supported a review of processes and controls to ensure readiness, protection of information privacy and compliance with the Ministry of Health requirements.

10.     The Crisis Management Team with representatives from the council group was called together following the re-emergence of positive COVID-19 cases in the community in January 2021. Communications to all staff have reinforced the key messages of scanning QR codes and council access cards, maintaining good hygiene practices and staying at home if unwell.

36th America’s Cup Programme

11.     The 36th America’s Cup is well underway in Auckland, with the cup racing scheduled to finish on 21 March 2021.

12.     At the time of writing this report, no new material risks have been identified. Risks and issues remain under constant review.

10-year Budget 2021-2031 (Long-term plan)

13.     The Risk and Assurance department continue to support and advise the 10-year budget 2021-2031 (Long-term plan) programme. Risks and issues are being actively managed and escalated as appropriate and the process remains on track.

14.     The Audit and Risk Committee extraordinary meeting on 9 February 2021 received an update on the risks and mitigations as part of the reporting on the 10-year budget 2021-2031 consultation document and its supporting information.

15.     The Risk and Assurance department will continue to support the 10-year budget 2021-2031 programme until its adoption in June 2021.

Ngā tūtohunga

Recommendation/s

That the Audit and Risk Committee:

a)      note the risk update including progress made on the Auckland Council Top Risk reset and the risk champion’s programme

b)      refer the Enterprise Risk Update - February 2021 report to the Governing Body for information.

 

Horopaki

Context

16.     This report provides an update on the progress of the enterprise risk work programme and other significant programme risk activities.

17.     This information enables the Audit and Risk Committee to fulfil their governance and oversight role of the effectiveness of risk management within Auckland Council. This includes recognition of emerging risks, risk assessments and risk management.

Tātaritanga me ngā tohutohu

Analysis and advice

Auckland Council Top Risk Reset progress update

18.     The top risks for Auckland Council were reassessed and reset in November 2020 to respond to the changing risk landscape.

19.     The risk identification process has identified 11 top risk areas that may significantly impact council’s achievement of Our Strategy 2022 Kia Manawaroa Tātou, Our Charter principles Tā tātou kawenata and council’s current strategic objectives. The risk reset process is enabling ‘real time’ risk/opportunity considerations across the council through the business planning process. The 11 risks were reported to the Audit and Risk Committee on 9 December 2020 (refer to Attachment A for a summary of risks).

20.     The Risk and Assurance team department are facilitating the process and working with nominated ELT sponsors to refine the risk descriptions and assess the drivers, impacts and controls.

21.     The ‘bow-tie’ methodology[1] is being used for the analysis to provide a consistent approach in evaluating the risks. Risk workshops are being completed with the ELT sponsor, general managers, subject matter experts and risk champions across the council.

22.     At the time of writing this report, workshops and discussions have been completed for the following top risk areas:

·     strategic relationships

·     data and information

·     decision-making - complex governance under pressure

·     financial management

·     organisational performance

·     adaptability

·     health, safety, and wellbeing

·     fraud and corruption

·     service delivery.

23.     The remaining workshops to be held in February 2021 are:

·     Māori outcomes

·     resilience and recovery.

24.     Following the workshop process to refine and assess each risk area, the risk analysis will be finalised with the ELT sponsors. The completed top risks (including the risk rating and controls) will be reported to the ELT for discussion and approval. The completed risk register will be reported to the next Audit and Risk Committee in May 2021.

Risk Champions programme – risk kōrero

25.     The Auckland Council risk champions network is a key mechanism for embedding good risk culture and good practice across the enterprise.

26.     As part of developing risk maturity and maintaining effective risk management practice across the enterprise, over 50 risk champions across the Auckland Council group joined a risk kōrero on 19 January 2021.

27.     The theme for the first session of 2021 was how to effectively integrate risk management into everything we do. The Enterprise risk team presented on the top risk reset and the Regulatory division and ICT departments shared risk management practices, tips and insights.

28.     From a top-down perspective, Chief Executive Jim Stabback provided enterprise risk insights and reinforced the importance of good, embedded risk management. The Director of Regulatory Services Craig Hobbs shared the value and process of creating a risk profile. At a department level, the Director of ICT Mark Denvir and his team spoke about cybersecurity risk and how to maintain a strong control environment. The ICT risk champions shared how risk is part of their operational rhythm. There was good engagement evidenced by the robust questions and answers after each session.

29.     The risk champions have been briefed on the refreshed top risks and they provided feedback on likelihood and impacts of each risk at a divisional and departmental level. This information has been captured and is informing the assessment and management of the top risks.

30.     A programme for risk champions (including regular forums) is being developed and the next risk kōrero is scheduled in April 2021.

COVID-19 pandemic update - resurgence readiness

31.     Auckland Council remains vigilant and ready to respond in the event of any resurgence of COVID-19. 

32.     Processes have been reviewed and controls reinforced to ensure readiness, protection of information privacy and compliance with the Ministry of Health requirements.

33.     The Crisis Management Team, with representatives from the council group, was called together following the re-emergence of COVID positive cases in the community in January 2021 and is ready to respond if alert levels change or if a positive case emerges in Auckland.

34.     All people leaders and staff received further reminders and communications to encourage good hygiene practices, reinforce the expectation to stay at home if unwell and to scan QR codes and council access cards to enable quick tracing.

36th America’s Cup Programme

35.     The 36th America’s Cup is well underway in Auckland, with the cup racing scheduled to finish on 21 March 2021.

36.     At the time of writing this report, there are no new material risks identified. Risks and issues are under constant review.

10-year Budget 2021-2031 (Long-term plan)

37.     The Risk and Assurance department continue to support and advise the 10-year Budget 2021-2031 (Long-term plan) programme.

38.     Risks and issues are being actively managed and escalated as appropriate and the process remains on track.

39.     The Audit and Risk Committee extraordinary meeting on 9 February 2021 received an update on the risks and mitigations as part of the reporting on the 10-year budget 2021-2031 consultation document and its supporting information.

40.     Risk and Assurance will continue to support and advise the 10-year budget 2021-2031programme on risk management and audit matters until its adoption in June 2021.

Tauākī whakaaweawe āhuarangi

Climate impact statement

41.     Climate change and its impacts remain a top risk for the council group. Climate change is incorporated as a critical driver for the “council and Auckland’s resilience and recovery” risk.  

42.     The Risk and Assurance department continue to collaborate with the Chief Sustainability Office, Finance Division and relevant departments across the council group to support the council’s adaptation and mitigation workstreams and to prepare for the group’s task force on climate-related financial disclosures by 2023.

43.     The key areas of focus for 2021 are to set up a coordinated group approach to manage and respond to climate risk, scenario analysis, roles and responsibilities and to expand monitoring and reporting.

44.     A risk workshop with all relevant subject experts will be held in February 2021 to evaluate this risk area further.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

45.     The Risk and Assurance department works with risk managers and key staff in the council-controlled organisations to collaborate and manage group risks.

46.     The 36th America’s Cup, the 10-year Budget 2021-2031 and COVID-19 readiness have impacts across the council group.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

47.     There are no direct impacts on local boards, however they are affected by the 10-year Budget 2021-2031 and by many of the top risks as they represent risks to Auckland Council.

Tauākī whakaaweawe Māori

Māori impact statement

48.     The delivery of Māori outcomes is a key strategic objective for the council and is a top risk area.

49.     A re-evaluation of the Māori outcomes top risk is being completed as part of the top risk reset process. A report on the drivers, potential impacts and mitigations and controls will be reported to the Audit and Risk Committee in May 2021.

50.     It is recognised that Māori have important perspectives and insights on the impacts and opportunities potentially arising from the council’s top risk areas being evaluated through the top risk reset process. Relevant internal experts including Māori outcome leads have therefore been invited to participate in the risk workshops including the hui on the following risks:

·    decision-making - complex decision-making under pressure

·    strategic relationships and

·    data and information.

51.     This is to ensure the management of these risks appropriately addresses and incorporates the potential impacts on Māori.

Ngā ritenga ā-pūtea

Financial implications

52.     While Financial Management is a top risk, there are no costs associated with the committee receiving this report on enterprise risk management activities for the period December 2020-January 2021, including updates on progress made on the Auckland Council Top Risk reset and the risk champion’s programme.

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

53.     Auckland Council’s top risks and mitigations are discussed in the body of this report.

54.     The Risk and Assurance department continue to scan for emerging risks and escalate as appropriate. One area of focus is the council’s ability to navigate potential future shocks following the impacts of recent risk events including COVID-19, drought and cyber-attacks.

Ngā koringa ā-muri

Next steps

55.     The Risk and Assurance department continue to work with nominated executive leadership sponsors to develop each top risk and confirm drivers, impacts, controls, and risk ratings. 

56.     The combined risk register will be reported to the executive leadership team for discussion and approval when the top risk assessments are completed. The top risks will be reported to the next Audit and Risk Committee in May 2021.

57.     The risk team’s forward work programme, including the risk champions programme, will be reported to the Audit and Risk Committee in May 2021.


 

 

Ngā tāpirihanga

Attachments

No.

Title

Page

a

Auckland Council Top Risks Summary February 2021

27

     

Ngā kaihaina

Signatories

Authors

Emma Mosely - Strategic Lead Risk and Assurance

Ann Brown - Senior Risk Advisor

Matthew Kerly - Risk Advisor

Authorisers

Mark Maloney - General Manager Risk and Assurance

Phil Wilson – Director, Governance & CCO Partnerships

 


Audit and Risk Committee

22 February 2021

 

PDF Creator


Audit and Risk Committee

22 February 2021

 

Auckland Council's health, safety and wellbeing (HSW) performance (Covering report)

File No.: CP2021/01142

 

  

 

Te take mō te pūrongo

Purpose of the report

 

1.       To update the committee on Auckland Council’s health, safety and wellbeing (HSW) performance.

Whakarāpopototanga matua

Executive summary

2.       This is a late covering report for the above item. The comprehensive agenda report was not available when the agenda went to print and will be provided prior to the 22 February 2021 Audit and Risk Committee meeting.

Ngā tūtohunga

Recommendation/s

The recommendations will be provided in the comprehensive agenda report.


Audit and Risk Committee

22 February 2021

 

Insurance Update

File No.: CP2021/00498

 

  

Te take mō te pūrongo

Purpose of the report

1.       To provide the committee with a progress update on the 2021/2022 insurance renewal, the cumulative loss modelling study and alternative insurance options.

2.       To obtain risk oversight and feedback from the committee on Auckland Council group's (the group’s) draft insurance strategy for 2021-2023.

Whakarāpopototanga matua

Executive summary

3.       The Auckland Council group's insurance strategy (the Strategy) expired in December 2020. We have developed a draft strategy for the next three years, which is currently with the council-controlled organisations for consultation. A copy of the draft strategy is attached (Attachment A) to this report for committee’s review and oversight. The final draft strategy will be tabled with this committee for review in May 2021, and to the Finance and Performance Committee in June for approval.

4.       The primary objective of the Strategy is to ensure insurance arrangements are fit for purpose, represent value for money, and are appropriate to the risk profile of the Auckland Council group.

5.       A key initiative included in the Strategy is to assess alternative options for insurance arrangements. This is reflected in council’s chief executive’s performance objectives for the year ended 30 June 2021. This assessment is currently being performed and will be tabled with the committee for review in May 2021, and to the Finance and Performance Committee in June for approval.

6.       The group’s current insurance arrangements expire on 30 June 2021. Work is underway to prepare for the renewal of policies for the 2021/22 year. The programme will be presented to the Audit and Risk Committee in May 2021 for review and to the Finance and Performance Committee in June for approval.

7.       Initial work on cumulative loss modelling has been completed and reported to this Committee in May 2021. A business case to progress this work is currently being prepared. This work involves further integration of asset and hazard datasets, criticality/vulnerability analysis, business interruption and third-party liability analysis. Our objective is to complete this work in 2021/2022.

Ngā tūtohunga

Recommendation/s

That the Audit and Risk Committee:

a)      note the progress update on the 2021/2022 insurance renewal, cumulative loss modelling study and alternative insurance options.

b)      provide risk oversight and feedback on the group’s draft insurance strategy.

Horopaki

Context

8.       The Audit and Risk Committee's purpose is to assist and advise the Governing Body in discharging its responsibility and ownership of governance, risk management, and internal control. As the group's insurance programme is a key control for managing and transferring risks, staff provide the insurance update to the committee for oversight and review.

9.       This report follows the brief insurance update provided to the Audit and Risk Committee on 8 December 2020.

Tātaritanga me ngā tohutohu

Analysis and advice

Group insurance strategy update

10.     The group’s insurance strategy expired in December 2020.

11.     In October 2020, we held a workshop with the Insurance Leadership Group (council and council controlled-organisation representatives) to discuss and agree on the purpose, guiding principles, key objectives, and deliverables for the next three years. 

12.     Following the workshop held in October, staff have developed the draft strategy for 2021 to 2023. The draft is currently with council-controlled organisations for consultation with feedback expected before the end of February 2021.

13.     The key objectives of the strategy are to:

i.    facilitate sustainable and diversified insurance arrangements by using a combination of risk transfer options

ii.    improve insurance programme’s maturity by implementing a common group approach. For example, consistent deductibles and loss limits across all entities

iii.   centralised group claims management

iv.  optimise insurance to reflect the group’s size, scale and risk profile, including fuller assessment of cumulative loss exposure and risk funding options

v.   proactively dealing with the impact of climate change risks on group insurance

vi.  maximise the use of insights and risk modelling scenarios into long term asset planning

vii.  achieve better value for money by providing better quality of data for assets and risk disclosures

14.     A copy of the draft strategy, including its key objectives, is attached to this report as Attachment A.

15.     After receiving feedback from council-controlled organisations, the proposed strategy will be presented to council’s Executive Leadership Team (ELT) before the end of April 2021, the Audit and Risk Committee in May 2021, and the Finance and Performance Committee in June 2021.

Alternative insurance options

16.     In November 2020, the Governing Body approved the performance objectives of the chief executive. Under the performance objective of ‘Balance Sheet Management’, the following insurance-related measure was included:  

·    “Optimise insurance arrangements to reflect the size and scale of Auckland Council group and appropriate transfer and management of Auckland Council group risks”.

17.     Currently, the group programme relies primarily on the external insurance market to meet its risk transfer requirements. However, the unpredictable state of the insurance market, rising premium costs, and the potential impacts of climate change on insurance have now made it critical for the group to explore and adopt a combination of risk transfer options.

18.     This approach will lift the insurance programme's maturity to a strategic level (group-focused) instead of a transactional level.

19.     To deliver on the council’s chief executive’s objective, multiple options are being explored, including one or a combination of the following:

i.    captive insurance – an insurance company, wholly owned and controlled by council. Its primary purpose would be to insure the insurance risks of its owner.

ii.    protected cell captivea variation of a captive insurance company. However, the captive is not owned by council. It is owned by a captive manager company. It achieves the same purpose as the captive insurance company in that it insures the insurance risks of council.

iii.   internal insurance fund

iv.  higher deductibles – funded from the balance sheet

v.   status quo – continue using the insurance market as the primary option.

20.     All options are being carefully examined to understand their respective implications, including, legal, financial, regulatory, tax and audit.

21.     The suitable options for insurance will be presented to council’s ELT before the end of April 2021, Audit and Risk Committee in May 2021, and the Finance and Performance Committee in June 2021.

Update on insurance renewal activities

 

22.     The group’s current insurance programme expires on 30 June 2021. Work is underway to prepare for the upcoming renewal of policies for the 2021/22 year. The programme will be presented to the Audit and Risk Committee in May 2021 for review and to the Finance and Performance Committee in June 2021 for approval.

23.     Based on advice provided by the council group broker, Aon New Zealand (Aon), property insurers are starting to expect detailed risk disclosures around floods. This is due to the increased frequency and severity of flood events worldwide over the last three years. In the absence of such disclosures, it is expected that the insurers may impose a higher deductible or a reduced loss limit for any flood losses.

24.     The cumulative loss modelling study will provide a better sense of the group's flood exposure, which will help manage the risk of reduced insurance for flood damage. 

25.     The increased number of claims over the last year has put additional pressure on the professional indemnity markets' capacity. Currently, the group buys a combined policy for professional indemnity and public liability with an overall limit of $200m. If the capacity constraints were to continue, the insurers may separate the combined cover and ask the group to nominate an individual loss limit for each policy.

26.     To address this, a series of workshops will be held with relevant departments. The workshops' objective will be to identify plausible scenarios with a risk of financial loss claim against the council.

27.     In these workshops, staff will aim to capture risk scenarios, consequences, mitigation measures, residual risk exposure and approximate financial impact to develop a risk register. The risk register, along with historical claims data, should enable staff to recommend (if required) separate loss limits for professional indemnity and public liability insurance.

Cumulative loss modelling study

28.     The purpose of the cumulative loss modelling study is to determine the range of potential financial losses the group could incur due to natural hazard events. The hazards in scope are earthquakes, volcanic eruption, flooding (pluvial, fluvial and coastal) and storms. The study results will be used to optimise the group's risk funding options, including insurance.

29.     Key findings of the initial phase of the study were presented to the Audit and Risk Committee in May 2020. This work brought together a region-wide view of the group’s asset distribution and values, overlaid with the available hazard data, which provided a basic exposure assessment.

30.     Further integration of asset and hazard datasets, criticality/vulnerability analysis, business interruption and third-party liability analysis now needs to be carried out.

31.     We have held discussions with GNS Science (GNS) and Earthquake Commission (EQC), to discuss the possibility of collaborating on the study. If agreed, this approach will keep costs at a prudent level, improve alignment with the Central Government and enable best practice sharing with other councils.

32.     Aon, GNS and EQC are currently exploring available methodologies to deliver this work collaboratively. The scope of this work is expected to be finalised before the end of March 2021. A business case will be submitted to the council’s ELT for approval, with the aim of completing this work in 2021/2022.

Tauākī whakaaweawe āhuarangi

Climate impact statement

33.     There are no direct climate change implications arising from this report. However, it has been noted that insurers continue to reassess the risks associated with climate change, which may have impacts on future cover.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

34.     The Insurance Leadership Forum (representatives from the council and council-controlled organisations) will continue to work cohesively to deliver various insurance-related projects in the current financial year and beyond.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

35.     The placement of insurance for the council group is a region-wide issue and not specific to any particular local boards, and this matter specifically impacts no local boards. Accordingly, there has not been any consultation undertaken directly with local boards.

Tauākī whakaaweawe Māori

Māori impact statement

36.     The group insurance programme extends to the Independent Māori Statutory Board, the Tūpuna Maunga o Tāmaki Makaurau Authority, the Ngāti Whātua Ōrākei Reserves Board and Te Poari o Kaipātiki ki Kaipara (formerly the Parakai Recreation Reserve Board). There are no proposed changes to the existing arrangements.

Ngā ritenga ā-pūtea

Financial implications

37.     The placement of the annual insurance programme has a financial cost to council, which is closely managed with the Finance division and is appropriately budgeted. Indicative costs associated with the programme are anticipated to be provided to this committee at its May 2921 meeting.

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

38.     The insurance strategy and the annual renewal is integrated into the council group Insurance Policy, the Treasury Management Policy, and Risk Framework. There is a close alignment between key areas assisting with transfer of council group risks onto insurance. However, there is a risk of sub-optimal insurance arrangements due to the evolving asset base and business activities.

39.     The ongoing mitigation to this risk is improving the quality of data, effective communication and prudent risk disclosures of the group's assets and business activities to insurers.

Ngā koringa ā-muri

Next steps

40.     The programme will be presented to the Audit and Risk Committee in May 2021 for review and to the Finance and Performance Committee in June 2021 for approval. 

41.     Additionally, the proposed group insurance strategy and alternative insurance options will be presented to the ELT before the end of April 2021, the Audit and Risk Committee for risk oversight in May 2021, and the Finance and Performance Committee for approval in June 2021.

Ngā tāpirihanga

Attachments

No.

Title

Page

a

Attachment A - Draft Insurance Strategy 2021-2023

37

     

Ngā kaihaina

Signatories

Author

Amit Prashar - Insurance and Claims Manager

Authorisers

Mark Maloney - General Manager Risk and Assurance

Peter Gudsell - Group Chief Financial Officer

Phil Wilson – Director, Governance & CCO Partnerships

 


Audit and Risk Committee

22 February 2021

 

PDF Creator


PDF Creator


PDF Creator


Audit and Risk Committee

22 February 2021

 

Treaty Audit Monitoring Update

File No.: CP2021/00988

 

  

 

Te take mō te pūrongo

Purpose of the report

1.       This report provides an update on:

·    the ongoing monitoring of the council’s Te Tiriti o Waitangi Audit Response Programme (Treaty Audit Response Programme) to implement the recommendations contained in Te Tiriti o Waitangi Audits (Treaty Audits) of the council. These Treaty Audits are commissioned by the Independent Māori Statutory Board every three years.

·    the risk assessment on the implementation of the Māori Outcomes Framework.

Whakarāpopototanga matua

Executive summary

2.       The Waharoa group of council has continued to perform an oversight role with respect to the monitoring and reporting on the delivery of Treaty Audit Response Programme.

3.       Of the ten open Treaty Audit recommendations reported to the Committee in August 2020, one has been closed (recommendation 67 - performance measurement framework).  Of the nine remaining open recommendations:

·    three have projects plans in place that have been approved by the Waharoa group in this period

·    the project plan for recommendation 10 (relationship agreements) is currently being developed

·    the progress of the remaining five continue to be monitored.

4.       This committee resolved in August 2020 that the Assurance Services department should provide a risk assessment report to the committee about the implementation of the Māori Outcomes Framework in February 2021. (AUD/2020/1).

5.       The top risk on Māori outcomes was reviewed and reported to this committee in September 2020 as part of the quarterly risk assessment. It is currently being reviewed and will be ready to be reported to this committee once finalised in May 2021.

 

Ngā tūtohunga

Recommendation/s

That the Audit and Risk Committee:

a)      receive the update on the monitoring and progress of the Treaty Audit Response Programme

b)      note the oversight and monitoring that has been performed by the Risk and Assurance department in relation to the Treaty Audit Response Programme

c)      note that the Risk and Assurance department will continue to report on a six-monthly basis on progress against the Treaty Audit Response Programme to this committee

d)      note that the Risk and Assurance department will report to the May 2021 meeting of this Committee on the Māori Outcomes framework risk.

 

Horopaki

Context

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

7.       The third treaty audit was completed and received by the Finance and Performance Committee in July 2018, and by the Audit and Risk Committee in September 2018.

8.       Te Tiriti o Waitangi Audit Report 2018 noted that council had made a considerable effort over the previous twelve months to address the outstanding recommendations from the previous two audits. It also recognised that progress has been made in the development of Māori Responsiveness Plans (MRPs).

9.       Te Tiriti o Waitangi Audit Report 2018 recommends that the Risk and Assurance 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.

10.     The Treaty Audit Response Programme is the basis for the Risk and Assurance department’s monitoring and reporting to the Audit and Risk Committee.

Tātaritanga me ngā tohutohu

Analysis and advice

The Waharoa group

11.     The Waharoa group comprises representatives from the Risk and Assurance department, Nga Mātārae and the Independent Māori Statutory Board Secretariat.

12.     The Waharoa group provides oversight of the Treaty Audit Response Programme, including monitoring, guidance and support to action owners and their executives, and agrees closure of recommendations. The Risk and Assurance department provides independent oversight and reporting of progress. 

Te Tiriti /Treaty Audit Response Programme

13.     In February 2020 we reported that the strengthened process for monitoring the delivery of the work programme had enabled an increase in the rate of closure of audit recommendations. Improved documentation of the work plans to respond to each recommendation and clearer tracking documents have been implemented.

14.     The following recommendation has been closed in this reporting period:

·    performance Measure Framework (Recommendation 67 – 2015).

15.     Of the nine remaining open audit recommendations eight have approved project plans in place which are being monitored by the Waharoa group.

Audit Year

Total No of Recommendations

Closed September 2020-Feb 2021

Total Open

Feb 2021

Project Plan Status

2012 and 2015

67

1

5 (Feb 6)

1 in development

 

4 monitored

2018

13

0

4 (Feb 4)

4 monitored

 

16.     Project plans have been approved by the Waharoa group this period on:

·    clarification of the previously approved plan on Contract Management System (Recommendation 31)

·    Taonga Management Policy (Recommendation 12)

·    protection of Sensitive Information (Recommendation 13).

17.     The following recommendations which have project plans in place continue to be monitored:

·    closure criteria for all open actions (Recommendation 1 – 2018)

·    Mana Whenua Participation in Resource Consents (Recommendation 34 and 58B – 2015)

·    evolution of Māori Responsiveness Plans (Recommendations 6 and 7 – 2018).

18.     Work is currently being progressed to develop the project plan for the Waharoa group to approve for:

·    Relationship Agreements (Recommendation 10).

Risk Assessment – Implementation of Māori Outcomes

19.     In September 2020, council’s top risks, including Māori outcomes were reported to this committee as part of the quarterly risk reporting. The September 2020 Māori Outcomes Top Risk assessment is provided at Attachment A.

20.     As reported separately, the top risks for Auckland Council were reassessed and reset in November 2020 to respond to the changing risk landscape.

21.     The November 2020 risk identification reset has identified 11 top risk areas that may significantly impact council’s achievement of Our Strategy 2022 Kia Manawaroa Tātou, Our Charter principles Tā tātou kawenata and council’s current strategic objectives.  The 11 risks were reported to the Audit and Risk Committee on 9 December 2020.

22.     Māori Outcomes has been identified as one of those 11 top risks – including the risk of not adequately working towards a Tamaki Makarau where Māori thrive, achieving outcomes with Māori and meeting responsibilities to Māori. 

23.     The Risk and Assurance department are currently facilitating the process and working with nominated Executive Lead Team (ELT) sponsors to refine the risk descriptions and assess the drivers, impacts, and controls for each top risk.  The Director Governance and CCO partnerships is the ELT sponsor for the Māori Outcomes top risk.

24.     Analysis using the risk ‘bow-tie’ methodology[2] is being undertaken to provide a consistent approach in evaluating the risks. Risk workshops are being completed with the ELT sponsor, general managers, subject matter experts and risk champions across the council. The workshop to complete the Māori Outcomes top risk will occur in late February 2020.

25.     Following the workshop process the risk analysis will be finalised with the ELT sponsor.  The completed top risks (including the risk rating and controls) will be reported to the ELT for discussion and approval.  The completed risk register, including the Māori Outcomes top risk will be reported to the next Audit and Risk Committee in May 2021.

Tauākī whakaaweawe āhuarangi

Climate impact statement

26.     There are no impacts on climate from this report.  However, the Māori Outcomes Framework is based on wellbeing and includes environmental wellbeing.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

27.     The Treaty Audit Response Programme work enables the council group to strengthen responsiveness to Māori through targeted actions and improvements cited in the Maori Outcomes Framework. The Māori Outcomes Framework is intended to provide clarity and guidance to the council group.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

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

Tauākī whakaaweawe Māori

Māori impact statement

29.     The Treaty Audit Response Programme enables the council group to strengthen responsiveness to Māori through targeted actions and improvements cited in the Maori Outcomes Framework.

Ngā ritenga ā-pūtea

Financial implications

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

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

31.     Key risks to achieving completion of the Treaty Audit Response Programme are

·    lack of resources and capability

·    lack of oversight and monitoring of the work programme.

32.     The independent oversight and monitoring by the Risk and Assurance department, membership of the Waharoa group and six-monthly reporting to the Audit and Risk Committee are key mitigations of these risks.

Ngā koringa ā-muri

Next steps

33.     The Risk and Assurance department will continue to attend the Waharoa group and monitor the Treaty Audit Response Programme and report to the Audit and Risk Committee in accordance with the Assurance plan, and the committee’s forward work programme.

34.     The finalised risk assessment on the implementation of the Māori Outcomes framework will be reported to this committee in May 2021.

 


 

 

Ngā tāpirihanga

Attachments

No.

Title

Page

a

Maori Outcomes Risk Assessment September 2020

47

     

Ngā kaihaina

Signatories

Author

Mark Maloney - General Manager Risk and Assurance

Authoriser

Phil Wilson – Director, Governance & CCO Partnerships

 


Audit and Risk Committee

22 February 2021

 

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Audit and Risk Committee

22 February 2021

 

Final Office of the Auditor-General report to management for the year ended 30 June 2020

File No.: CP2021/00642

 

  

 

Te take mō te pūrongo

Purpose of the report

1.       To provide committee members with an overview of the internal control and financial/non-financial reporting matters identified by the Office of the Auditor-General during the final audit for the year ended 30 June 2020 and outline how Auckland Council is addressing the matters.

Whakarāpopototanga matua

Executive summary

2.       Audit New Zealand is Auckland Council’s external auditor appointed by the Office of the Auditor-General to conduct the audit on their behalf. Audit New Zealand works with the council throughout the year reviewing our internal controls, half year report and disclosures to both the New Zealand and overseas stock exchanges and auditing our annual report. The Office of the Auditor-General issues reports to the council throughout the year with recommendations on how the council can enhance and improve our processes, procedures and disclosures.

3.       Following the completion of the final audit, a report has been issued which outlines issues identified and makes recommendations for significant items that need to be addressed. This year, the report includes priority ratings for recommendations, being urgent, necessary and beneficial. The report is provided as Attachment A.

4.       The service performance of consenting activities continues to be highlighted as an area for improvement, specifically to processes, systems and controls to accurately record consent processing times.

5.       The new matters, which are all have a priority rating of necessary, include:

·   valuation of the investment properties

·   climate change

·   America’s Cup (AC 36) asset handover

·   revaluation of property, plant and equipment.

6.       The report also includes an update on prior year recommendations which are either in progress or have been resolved. Issues in progress are:

Matter

Priority rating

Building and resource consent processing times

Urgent

Review of Delegated Financial Authority Policy and SAP delegation

Necessary

Portfolio, programme and project management – Gateway reviews

Necessary

Consenting and service performance reporting

Necessary

Project management − project closure and benefits measurement

Beneficial

 

7.       10 of the 15 outstanding matters raised in previous reports have been resolved. These are detailed in Appendix 3 under the heading “Matters that have been addressed during the year”.

8.       The council accepts the Office of the Auditor-General’s recommendations and has provided a response outlining actions being taken to address each issue.

Ngā tūtohunga

Recommendation/s

That the Audit and Risk Committee:

a)      note the matters identified by the Office of the Auditor-General in its report to management at 30 June 2020, and Auckland Council’s responses to those matters.

Horopaki

Context

9.       This report summarises the matters identified by the Office of the Auditor-General during the final audit for the year ended 30 June 2020 and outlines how the council is addressing the matters raised.

10.     The Office of the Auditor-General issued their audit report on the Auckland Council group Annual Report 2019/2020 on 29 October 2020. As part of the audit process, the auditors evaluate the council’s systems, processes and controls that have an impact on the annual report. Matters identified during the audit are reported to the council. The council responds to the matters raised and describes the actions that will be undertaken to resolve them.

Tātaritanga me ngā tohutohu

Analysis and advice

11.     The following matters were new matters raised with management’s response:

Matter

Priority rating

Managements response

Valuation of the investment properties

Valuers should provide supporting calculations, comparable sales and rental evidence provided to support certain valuations

Necessary

We concur and will obtain the necessary support.

Climate change

Council should continue to further develop climate change reporting

Necessary

Management has commenced work to improve its assessment, monitoring and reporting of climate risks.

AC 36 asset handover

Council should ensure asset transfer is well managed

Necessary

Critical and ongoing asset management planning with maintenance schedules are already underway.

Revaluation of property, plant and equipment

Council should complete fair value assessments and determine whether a revaluation is required for the 2021 year, as soon as possible

Necessary

Management has commenced performing fair value assessments of all material asset classes at 31 December 2020.

 

12.     Updates were provided on previous recommendations:

Matter

Priority rating

Managements response

Building and resource consent processing times

 

Urgent

Management concurs and expects to have implemented improvements by 30 June 2021.

Review of Delegated Financial Authority Policy and SAP delegation

Necessary

A cross-functional working group has been set up to take this work forward in 2021.

Portfolio, Programme and Project Management – Gateway reviews

Necessary

This is on track for delivery by May 2021.

Consenting and service performance reporting

Necessary

Management concurs and expects to have implemented improvements by 30 June 2021.

Project management − project closure and benefits measurement

Beneficial

This is on track for delivery by May 2021.

Tauākī whakaaweawe āhuarangi

Climate impact statement

13.     There are no items covered by this agenda item that impact climate change although there is an audit recommendation regarding climate change financial disclosures in the 2020/2021 annual report.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

14.     There are no items covered by this agenda item that impact the Auckland Council group, so the views of group entities have not been sought.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

15.     There are no local impacts from the audit report or issues relating to reporting at a local board level. Accordingly, the views of local boards have not been sought.

Tauākī whakaaweawe Māori

Māori impact statement

16.     The report does not affect the achievement or reporting on Auckland Council’s or the Auckland Council Group’s contributions towards Māori outcomes. The council’s contributions to Māori outcomes are reported in the annual report.

Ngā ritenga ā-pūtea

Financial implications

17.     The matters in this report relate to internal controls and processes and such, do not have any direct financial implications.

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

18.     There is a risk that actions undertaken by management to address internal control deficiencies may not be considered sufficient or appropriate to address Audit New Zealand’s concerns.

Ngā koringa ā-muri

Next steps

19.     Auckland Council will continue to work on resolving and clearing the outstanding issues.

 

Ngā tāpirihanga

Attachments

No.

Title

Page

a

Final Office of the Auditor-General report to management for the 30 June 2020 audit

53

     

Ngā kaihaina

Signatories

Authors

Tracy Gers - Group Accounting & Reporting Manager

Francis Caetano - Group Financial Controller

Authorisers

Peter Gudsell - Group Chief Financial Officer

Phil Wilson – Director, Governance & CCO Partnerships

 


Audit and Risk Committee

22 February 2021

 

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Audit and Risk Committee

22 February 2021

 

Approval of the draft Audit New Zealand audit plan for the year ended 30 June 2021

File No.: CP2021/00576

 

  

 

Te take mō te pūrongo

Purpose of the report

1.       To approve the draft Audit New Zealand audit plan for their audit of the Auckland Council Group’s 30 June 2021 annual report.

Whakarāpopototanga matua

Executive summary

2.       Audit New Zealand has provided the draft audit plan for their audit of the council’s 30 June 2021 annual report for the council’s approval in Attachment A. The group financial controller and group treasurer have reviewed the draft letters, provided feedback and Audit New Zealand has made all requested amendments.

3.       The draft audit plan outlines key audit matters, the areas of audit focus, significant business and reporting risks and administration matters such as logistics and timetables.

4.       The audit plan is provided in draft and is required to be approved by the Audit and Risk Committee before Audit New Zealand issues the final audit plan.

5.       Deputy Auditor-General Greg Schollum and Audit New Zealand Director Athol Graham will be in attendance to discuss the proposed key audit matters and answer any questions the committee may have.

Ngā tūtohunga

Recommendation/s

That the Audit and Risk Committee:

a)      review and approve the draft audit plan for the 30 June 2021 audit of the annual report

b)      request Audit New Zealand to issue the final audit plan.

 Horopaki

Context

6.       The audit plan outlines how Audit New Zealand will conduct their audit to obtain reasonable assurance that the 30 June 2021 financial statements and performance information are free from material misstatement resulting from error, omission or fraud.

7.       The draft audit plan outlines the following:

·        key audit matters

·        Audit New Zealand’s response to accounting, business and service performance risks

·        the audit process

·        reporting protocols, logistics and timelines.

8.       As Auckland Council is an issuer of bonds on the New Zealand, Swiss and Singapore exchanges, the audit opinion on the group annual report is required to include the auditor’s comments of key audit matters. Key audit matters are defined as those matters that, in the auditor’s professional judgement, are of the most significance in the audit of the financial statements. The focus will be on:

·        areas identified as involving significant risk or requiring significant auditor judgement

·        areas in which the auditor encountered significant difficulty during the audit, such as obtaining sufficient, appropriate audit evidence

·        circumstances that required significant modification of the auditor’s planned approach, such as the identification of a significant deficiency in internal controls.

Tātaritanga me ngā tohutohu

Analysis and advice

9.       The draft audit plan is largely unchanged from prior years, except for the quantification of materiality within the plan. Materiality for accounts related to property, plant and equipment held at fair value are subject to materiality of $3.93 billion, and all other accounts are subject to materiality of $88.9 million.

10.     The draft audit plan outlines the following key audit matters:

·        Valuation of operational and infrastructure assets – consideration of significant changes in fair value which might require an independent valuation to be carried out. Classes of assets being revalued should be appropriately valued and related disclosures, such as the sensitivity of the valuation to changes in key assumptions, must comply with accounting standards.

·        Valuation and disclosure of derivatives – derivatives should be appropriately valued, and fair value movements should be clearly explained in the financial statements.

·        Valuation of the weathertightness and associated building defects provision are complex, subject to a high degree of judgement and estimation and there is inherent uncertainty in the quantum and value of unreported claims.

·        Reporting performance on three waters, transport and housing in relation to population growth.

11.     These key audit matters are consistent with the prior year except for the addition of three waters to the last area of focus, and the removal of accounting and disclosure of City Rail Link Limited.

12.     The draft audit plan also outlines business risks and issues along with their response as follows:

·  

·  

Business risk/issue

Audit response

Ongoing effect of COVID-19

·   Review appropriateness of ‘going concern’ assumption.

·   Understand key issues and how these are addressed and disclosed.

·   Consider effect of any further lockdown on operations.

·   Review COVID-19’s effect on valuation of assets.

Service performance reporting

·   Review progress related to consenting.

Crown funding initiatives

·   Review impact of funding and financing decisions.

·   Consider appropriateness of accounting treatment.

The risk of management override of internal controls

·   Test appropriateness of journal entries.

·   Review accounting estimates for bias.

·   Evaluate unusual and one-off transactions.

 

Legislative compliance

·   Assess compliance systems and processes.

·   Enquire as to non-compliance and consider its effect, if any.

·   Review compliance with Local Government (Rating) Act 2002, Financial Markets Conduct Act 2013 and NZX Listing Rules.

·   Review application of Regional Fuel Tax to projects.

Prudent expenditure decisions

·   Review transactions and make enquiries to determine the Auckland Council Group’s effectiveness and efficiency, reduction of waste, probity and financial prudence.

Project management

·   Obtain updates on key projects and management practices, and follow-up on progress made against previous recommendations.

Procurement

Contract management
13.     The draft audit plan also highlights two financial statement risks, namely:

·     accounting for impairment, capitalisation of costs and recognition of completed assets

·     valuation of investment properties.

14.     The Emerging Issues this year continue to be the CCO review and climate change, however, this year’s draft audit plan includes more detail in relation to their audit response compared to prior years.

15.     The key audit matters and other business and financial statement risks have been reviewed by management and are considered appropriate. These matters are part of the council’s business as usual and no specific items need to be brought to your attention.

16.     To view the detailed explanations of the risks and the audit responses please refer to the draft audit plan in Attachment A.

17.     The proposed fee for the 30 June 2021 audit is $1,239,042 plus estimated disbursements of $30,000 (excluding GST). This sum was set out in the Office of the Auditor-General’s Audit proposal letter for the years ending 30 June 2020, 2021 and 2022. The proposal letter, dated 17 December 2019 (Attachment B), was approved by this committee on 9 December 2019 (resolution as Attachment C) and signed by the mayor and chief executive on 18 December 2019.

18.     The audit plan contains the audit timings and delivery dates for information. The council is currently working with Audit New Zealand to finalise dates.

Tauākī whakaaweawe āhuarangi

Climate impact statement

19.     There is no impact arising directly from this report. However, reporting of the group’s response to climate change risk will be disclosed in the 2020/2021 annual report.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

20.     The audit plan covers the audit of the Auckland Council Group as a whole. Accordingly, information relating to entities in the group are outlined in the audit plan and will be communicated to the relevant staff.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

21.     This report is about the engagement of Audit New Zealand for the Auckland Council Group as a whole, with no direct impact at a local board level.

Tauākī whakaaweawe Māori

Māori impact statement

22.     The report is about the engagement of Audit New Zealand for the Auckland Council Group as a whole, with no impact specific to Māori.

Ngā ritenga ā-pūtea

Financial implications

23.     This paper is about the reporting of the financial performance of the Auckland Council Group. As such, there are no financial decisions required (noting the audit fee and disbursements were previously approved), and there are no financial implications as a result of this paper.

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

24.     No decisions beyond document approval and related delegations are sought from the committee and accordingly no risks need be considered.

Ngā koringa ā-muri

Next steps

25.     Following the approval of the audit plan by this committee, we will request that Audit New Zealand issue the audit plan in final. Staff will also confirm and finalise the delivery timelines with Audit New Zealand to ensure a timely and efficient annual audit process.

Ngā tāpirihanga

Attachments

No.

Title

Page

a

Draft Audit Plan for the 30 June 2021 audit

101

b

Audit proposal letter for 30 June 2020-2022

133

c

ARC resolution 9 December 2019: approval of the audit proposal letter

141

     

Ngā kaihaina

Signatories

Authors

Tracy Gers - Group Accounting & Reporting Manager

Francis Caetano - Group Financial Controller

Authorisers

Peter Gudsell - Group Chief Financial Officer

Phil Wilson – Director, Governance & CCO Partnerships

 


Audit and Risk Committee

22 February 2021

 

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Audit and Risk Committee

22 February 2021

 

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Audit and Risk Committee

22 February 2021

 

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Audit and Risk Committee

22 February 2021

 

Significant forecasting assumptions update for 10-year Budget 2021-2031 (Covering report)

File No.: CP2021/01101

 

  

 

Te take mō te pūrongo

Purpose of the report

1.       To provide oversight of the approach used to update the key COVID-19 related significant forecasting assumptions that will be used to refresh financial projections for the council group’s final 10-year Budget 2021-2031 (our long-term plan or LTP).

Whakarāpopototanga matua

Executive summary

2.       This is a late covering report for the above item. The comprehensive agenda report was not available when the agenda went to print and will be provided prior to the 22 February 2021 Audit and Risk Committee meeting.

Ngā tūtohunga

Recommendation/s

The recommendations will be provided in the comprehensive agenda report.


Audit and Risk Committee

22 February 2021

 

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       CONFIDENTIAL: Council-controlled organisations' quarterly risk update - February 2021

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.

In particular, the report contains risk reporting and detailed top risks confidential to the council-controlled organisations' Boards or Audit and Risk Committees. The council-controlled organisations have provided their risk repors for the council's Audit and Risk Committee 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.

C2       CONFIDENTIAL: 31 December 2020 half year results announcement for the NZX and Interim Report

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 information which if disclosed to the public, would breach NZX disclosure rules.

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       CONFIDENTIAL: Assurance Services Activity Update

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.

In particular, the report contains information which if released would jeopardise the effective delivery of the Assurance Services work programme.

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       CONFIDENTIAL: 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)(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 information regarding the financial result of the Auckland Council Group as at 31 December 2020.

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.

 



[1] Bow tie methodologies show causal links between sources of risk and consequences. 

[2] Bow tie methodologies show causal links between sources of risk and consequences.