Komiti Tātari me te Mātai Raru Tūpono /

Audit and Risk Committee

 

OPEN MINUTES

 

 

 

Minutes of a meeting of the Audit and Risk Committee held remotely via electronic link on Tuesday, 7 December 2021 at 2.08pm. A recording of the meeting is available on the Auckland Council website https://www.aucklandcouncil.govt.nz/about-auckland-council/how-auckland-council-works/meetings-council-bodies/Pages/webcasts-council-meetings.aspx

present

 

Chairperson

Sue Sheldon, CNZM

 

Deputy Chairperson

Cr Daniel Newman, JP

 

Members

Deputy Mayor Cr Bill Cashmore

 

 

Paul Conder

 

 

Cr Shane Henderson

 

 

Bruce Robertson

 

 

ABSENT

 

Ex-officio

Mayor Hon Phil Goff, CNZM, JP

 

 

 

IMSB Chair David Taipari

 

 

 

ALSO PRESENT

 

 

Cr Angela Dalton

 

 

 

Cr Christine Fletcher, QSO

 

 

 

IN ATTENDANCE

 

Greg Schollum, Deputy Auditor-General

 

 

Andrea Reeves, Assistant Auditor-General – Local Government

 

 

Athol Graham, Audit Director, Audit New Zealand

 

 

Penica Cortez, Audit Manager, Audit New Zealand

 

 

 

Note:   All members of the Audit and Risk Committee attended the meeting via electronic link.

 

 

 


Audit and Risk Committee

07 December 2021

 

 

 

Note:   a roll-call was conducted that ascertained the following members were in attendance at the commencement of the meeting:  ü

 

Sue Sheldon, CNZM

ü

Cr Shane Henderson

ü

Deputy Mayor Cr Bill Cashmore

ü

Cr Daniel Newman, JP

ü

Paul Conder, CA

ü

Bruce Robertson

ü

 

1          Apologies

 

Resolution number AUD/2021/69

MOVED by Chairperson S Sheldon, seconded by Deputy Chair Cr D Newman:  

That the Audit and Risk Committee:

a)         accept the apology from Mayor P Goff for absence on Council business.

CARRIED

Note:   a subsequent apology was received from IMSB Chair David Taipari for absence.

 

 

2          Declaration of Interest

 

Deputy Chair Cr D Newman subsequently declared an interest in Item C2 – CONFIDENTIAL: Legal Risk Update- specifically discussions regarding the Accommodation Provider Targeted Rate appeal.

 

 

3          Confirmation of Minutes

 

Resolution number AUD/2021/70

MOVED by Chairperson S Sheldon, seconded by Deputy Mayor Cr BC Cashmore:  

That the Audit and Risk Committee:

a)         confirm the ordinary minutes of its meeting, held on Monday, 13 September 2021, including the confidential section, as a true and correct record.

CARRIED

 

4          Petitions

 

There were no petitions.

 

5          Public Input

 

There was no public input.

 

6          Local Board Input

 

There was no local board input.

 

7          Extraordinary Business

 

There was no extraordinary business.

 

8

Forward Work Programme

 

 

 

Resolution number AUD/2021/71

MOVED by Chairperson S Sheldon, seconded by Member B Robertson:  

That the Audit and Risk Committee

a)      approve the forward work programme noting:

i)       the inclusion of regular risk reporting from Ports of Auckland Limited as from February 2022

ii)      the deferral of the audit arrangements letter with respect to the 30 June 2022 annual audit to February 2022.

CARRIED

 

 

 

9

Health, Safety and Wellbeing Report

 

 

 

Resolution number AUD/2021/72

MOVED by Chairperson S Sheldon, seconded by Member B Robertson:  

That the Audit and Risk Committee:

a)      note the information in this report and associated health, safety and wellbeing indicators

b)      refer this report to the Governing Body along with any commentary that the committee deems appropriate

c)      forward this report to Local Boards for their information.

CARRIED

 

 

 

10

Enterprise Risk Update - December 2021

 

 

 

Resolution number AUD/2021/73

MOVED by Chairperson S Sheldon, seconded by Deputy Chair Cr D Newman:  

That the Audit and Risk Committee:

a)      note the Enterprise Risk Update – December 2021 report

b)      refer the Enterprise Risk Update – December 2021 report to the Governing Body for information.

CARRIED

 

 

Deputy Chair Cr D Newman left the meeting at 2.40pm.

 

 


 

 

11

Final Office of the Auditor-General report to governors for the year ended 30 June 2021

 

 

 

Resolution number AUD/2021/74

MOVED by Chairperson S Sheldon, seconded by Deputy Mayor Cr BC Cashmore:  

That the Audit and Risk Committee:

a)      note the matters identified by the Office of the Auditor-General in its report to governors at 30 June 2021, and Auckland Council’s responses to those matters.

CARRIED

 

 

 

 

12

Approval of the draft Office of the Auditor-General Interim Review Engagement Letter for the six months ended 31 December 2021

 

 

 

Resolution number AUD/2021/75

MOVED by Chairperson S Sheldon, seconded by Member P Conder:  

That the Audit and Risk Committee:

a)      review and endorse Audit New Zealand’s draft interim review engagement letter, including the proposed review engagement fee

b)      request Audit New Zealand issue the final interim review audit engagement letter

c)      recommend the mayor and chief executive sign the final interim review audit engagement letter.

CARRIED

 

 

13

Preparation of the interim report and NZX release for the six months ending 31 December 2021

 

 

 

Resolution number AUD/2021/76

MOVED by Chairperson S Sheldon, seconded by Cr S Henderson:  

That the Audit and Risk Committee:

a)      note the information contained in this financial process status update for the Auckland Council Group NZX announcement and interim report for the six months ending 31 December 2021

b)      note that an update on the confidential matters and confidential draft documents related to the interim report and NZX release will be discussed later in this meeting in confidence.

CARRIED

 

 

Deputy Chair Cr D Newman returned to the meeting at 2.51pm.

 

 

 

14

Annual Report on the Performance of the Audit and Risk Committee

 

 

 

Resolution number AUD/2021/77

MOVED by Chairperson S Sheldon, seconded by Member P Conder:  

That the Audit and Risk Committee:

a)      receive this annual report on the Performance of the Audit and Risk Committee

b)      recommend that the chief executive place the report on the next available agenda of the Governing Body.

CARRIED

 

 

 

 

 

 

 

 

 

15        Consideration of Extraordinary Items

 

There was no consideration of extraordinary items.

 

 

 

 

 

 

 

 

16        Procedural motion to exclude the public

Resolution number AUD/2021/78

MOVED by Chairperson S Sheldon, seconded by Deputy Chair Cr D Newman:  

That the Audit and Risk Committee:

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

b)      agree that Greg Schollum, Deputy Auditor-General, Athol Graham, Audit Director, Audit New Zealand, Andrea Reeves, Assistant Auditor-General – Local Government and Penica Cortez, Audit Manager, Audit New Zealand be permitted to remain for the confidential part of the meeting after the public has been excluded, because of their knowledge of matters which will help the Audit and Risk Committee in its decision-making.

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 - December 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 substantive council-controlled organisations' Boards or Audit and Risk Committees. The council-controlled organisations have provided their risk reports 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: Legal Risk 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)(g) - The withholding of the information is necessary to maintain legal professional privilege.

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

s7(2)(i) - The withholding of the information is necessary to enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations).

In particular, the report contains legally privileged and commercially sensitive information.

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: Interim report and NZX release for the six months ending 31 December 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)(h) - The withholding of the information is necessary to enable the local authority to carry out, without prejudice or disadvantage, commercial activities.

In particular, the report and attachments contain information regarding the interim report and financial results of Auckland Council Group as at 31 December 31 which cannot be made public until released to the NZX.

s48(1)(a)

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

C5       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 from the Office of the Auditor-General and Audit New Zealand contains information regarding the interim report and financial results of Auckland Council Group as at 31 December 2021 which cannot be made public until released to the NZX.

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.

 

 

The text of these resolutions is made available to the public who are present at the meeting and form part of the minutes of the meeting.

CARRIED

 

 

2.55pm            The public was excluded.

 

Resolutions in relation to the confidential items are recorded in the confidential section of these minutes and are not publicly available.

 

5.22pm            The public was re-admitted.

 

restatementS

 

It was resolved while the public was excluded:

 

 

C1

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

 

Resolution number AUD/2021/70

MOVED by Chairperson S Sheldon, seconded by Deputy Mayor Cr BC Cashmore:  

That the Audit and Risk Committee:

a)      note the written and verbal updates provided by Watercare Services Limited and thank them for their attendance

b)      note the written updates provided by Auckland Transport, Auckland Unlimited and Eke Panuku

c)      refer the Council-controlled organisations quarterly risk update – December 2021 to the Council Controlled Organisations Oversight Committee for information

Restatement

d)      agree that the decision be released in the open minutes, but this report and its attachments remain confidential.

 

 

C2

CONFIDENTIAL: Legal Risk Update

 

Resolution number AUD/2021/71

MOVED by Chairperson S Sheldon, seconded by Deputy Mayor Cr BC Cashmore:  

That the Audit and Risk Committee:

a)      note the Legal Risk report

Restatement

b)      agree that the decisions be restated in the open minutes, but the Legal Risk report remains confidential.

 

 

 

C3

CONFIDENTIAL: Assurance Services Activity Update

 

Resolution number AUD/2021/72

MOVED by Chairperson S Sheldon, seconded by Member B Robertson:  

That the Audit and Risk Committee:

a)      receive and note the update on assurance activities performed by the Risk and Assurance department

Restatement

b)      agree that the decisions be restated in the open minutes but that the Assurance Services Activity update report and attachments remain confidential.

 

 

 

C4

CONFIDENTIAL: Interim report and NZX release for the six months ending 31 December 2021

 

Resolution number AUD/2021/73

MOVED by Deputy Mayor Cr BC Cashmore, seconded by Member B Robertson:  

That the Audit and Risk Committee:

a)      note the information contained in this financial process status update for the Auckland Council Group NZX announcement and interim report for the six months ending 31 December 2021

b)      endorse the accounting policies, key financial statements judgements, estimates and assumptions for the Auckland Council Group included in the 31 December 2021 pro forma interim report, subject to any required changes identified by management and Audit New Zealand during the half year close and auditor review

c)      approve the change in the group’s policy on capitalisation of software as a service cost

d)      request committee members give any further feedback on the pro forma interim report to staff by 14 January 2022

e)      delegate the authority to the committee chair to endorse any significant subsequent amendments to the pro forma interim report

f)       note the draft responses to the enquiries by Audit New Zealand on the Audit and Risk Committee’s oversight of the management of fraud

g)      request committee members give further feedback on the fraud questionnaire to staff by 14 January 2022

Restatement

h)      agree that the report and attachments will remain confidential, but the decisions be restated in the open minutes.

 

 

 

C5

CONFIDENTIAL: Office of the Auditor-General and Audit New Zealand Briefing

 

Resolution number AUD/2021/74

MOVED by Member P Conder, seconded by Deputy Mayor Cr BC Cashmore:  

That the Audit and Risk Committee:

a)      receive the information provided by the Auditor-General’s representatives Deputy Auditor-General Greg Schollum, Assistant Auditor-General Local Government Andrea Reeves and Audit New Zealand Audit Director Athol Graham, and thank them for their attendance

Restatement

b)      agree that the report and attachment will remain confidential, but the decisions be restated in the open minutes.

 

 

 

5.22pm                                               The Chairperson thanked Members for their attendance and attention to business and declared the meeting closed.

 

CONFIRMED AS A TRUE AND CORRECT RECORD AT A MEETING OF THE Audit and Risk Committee HELD ON

 

 

 

DATE:.........................................................................

 

 

 

CHAIRPERSON:.......................................................