I hereby give notice that an ordinary
meeting of the Audit and Risk Committee will be held on:
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Date:
Time:
Meeting Room:
Venue:
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Tuesday, 23
August 2022
10.00am
Reception
Lounge
Level 2, Auckland Town Hall
305 Queen Street
Auckland
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Kōmiti Tātari me te Mātai
Raru Tūpono /
Audit and Risk Committee
OPEN AGENDA
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MEMBERSHIP
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Chairperson
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Sue Sheldon, CNZM
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Deputy Chairperson
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Cr Daniel Newman, JP
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Members
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Deputy Mayor Cr Bill Cashmore
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Member Paul Conder, CA
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Cr Shane Henderson
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Member Bruce Robertson
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Ex-officio
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Mayor Hon Phil Goff, CNZM, JP
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IMSB Chair David Taipari
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(Quorum 3 members)
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Quorum must include two Governing Body
members
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Mike Giddey
Kaitohutohu Mana Whakahaere /
Governance Advisor
17 August 2022
Contact Telephone: (09) 890 8143
Email: mike.giddey@aucklandcouncil.govt.nz
Website: www.aucklandcouncil.govt.nz
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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.
Code of conduct
For information relating to Auckland
Council’s elected members code of conduct, please refer to this link on
the Auckland Council website - https://www.aucklandcouncil.govt.nz/about-auckland-council/how-auckland-council-works/elected-members-remuneration-declarations-interest/Pages/elected-members-code-conduct.aspx
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.
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Audit and Risk
Committee
23 August 2022
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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 Treaty Audit
monitoring update 11
9 Forward Work
Programme 21
10 Enterprise Risk Update
August 2022 27
11 Assurance Strategy,
Assurance Charter and Interim Audit Plan 53
12 Health, Safety and
Wellbeing Report 65
13 The Auditor-General's
report to management on the interim audit for the year ended 30 June 2022 73
14 Auckland Council Group's
NZX preliminary announcement and financial results to 30 June 2022 105
15 Consideration of
Extraordinary Items
PUBLIC EXCLUDED
16 Procedural Motion to Exclude
the Public 111
C1 CONFIDENTIAL: Council-Controlled
Organisations'- Quarterly Risk Update August 2022 111
C2 CONFIDENTIAL: Ports of Auckland
Limited Risk Update August 2022 112
C3 CONFIDENTIAL: Council Group Post
Insurance Renewal Update August 2022 112
C4 CONFIDENTIAL: Auckland Council
Group's NZX preliminary announcement and financial results to 30 June 2022 112
C5 CONFIDENTIAL: Office of the
Auditor-General and Audit New Zealand briefing 113
At the close of
the agenda no apologies had been received.
2 Declaration
of Interest
Members are
reminded of the need to be vigilant to stand aside from decision making when a
conflict arises between their role as a member and any private or other
external interest they might have.
3 Confirmation
of Minutes
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That the Audit and Risk Committee:
a)
confirm the ordinary minutes of its meeting,
held on Tuesday, 17 May 2022, including the
confidential section, as a true and correct record.
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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.”
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Audit and Risk
Committee
23 August 2022
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Treaty
Audit monitoring update
File No.: CP2022/11907
Te take mō te
pūrongo
Purpose of the report
1. This
monitoring report covers the period from February 2022 to August 2022 and
provides an update on:
· the
recommendations contained in Te Tiriti o Waitangi Audits
(Treaty Audits) of Auckland Council which are commissioned by the Independent Māori Statutory Board every three years
· progress in strengthening the alignment of Achieving Māori Outcome
plans (AMO) (previously known as Māori Responsiveness Plans (MRPs)), the
Integrated Performance Framework and Kia Ora Tāmaki Makaurau (KOTM)
· the Treaty Audit
Response Programme 2021-2024 (Attachment A) which has been developed by Nga
Mātārae on behalf of the chief executive in response to the
recommendations contained in He Waka Kōtuia / Te Tiriti o Waitangi 2021.
Whakarāpopototanga matua
Executive summary
2. There
are a total of 17 open recommendations. Four relating to the pre-2021 Treaty
Audits which are progressing toward closure with two recommendations planned to
be closed in the next six months. 13 recommendations remain open from the
fourth 2021 Treaty Audit report issued on 11 August 2021.
3. The
Waharoa group acknowledges that some of the target dates for implementation of
the recommendations are past. Management is working towards successful
implementation within the constraints of the workforce challenges being
experienced across Auckland Council.
4. The AMO plans of each of Auckland Council directorates are now being
aligned to KOTM. KOTM is the Māori Outcomes
performance measurement framework across Auckland Council. Work is
currently underway to also align the monitoring and reporting framework to KOTM
and the Integrated Performance Framework. Most of the council-controlled
organisations have their AMO plans now aligned to KOTM.
5. On
13 September 2022, the activities of the Waharoa group will be transferred to
the new proposed KOTM Enablement Board currently being implemented by Ngā
Mātārae as part of strengthening KOTM governance and performance.
6. The
Treaty Audit Response Programme 2021- 2024:
· will
continue to be used as the basis to monitor progress in implementing the
remaining and new recommendations from all Treaty Audits
· informs
reporting to this committee over the next three years.
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
2021- 2024.
b) note
that the Risk and Assurance department will continue to report on a six-monthly
basis on progress against the Treaty Audit Response Programme 2021- 2024 to
this committee.
Horopaki
Context
7. The
Independent Māori Statutory Board’s Treaty Audits set out a
framework for assessing Auckland Council’s performance against Auckland
Council’s statutory responsibilities and requirements relating to Te
Tiriti o Waitangi and to Māori.
8. 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. It identified a total of 80 recommendations, of which 76 have
now been closed.
9. He
Waka Kōtuia – Te Tiriti o Waitangi Audit 2021 was the fourth
Treaty Audit to be undertaken by the Independent Māori Statutory Board.
For the full report refer to Attachment A of our prior Treaty Audit monitoring
update presented to this committee on 22 February 2022. It contains 13
recommendations, building on previous audit findings, and with strong alignment
to the CCO review recommendations.
10. The Waharoa
group comprises representatives from the Risk and Assurance
department, Nga Mātārae and the Independent Māori Statutory Board Secretariat.
11. 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.
12. The Treaty Audit Response Programme 2021-2024 (Attachment A)
is the basis for the Risk and Assurance department’s monitoring and
reporting to this committee.
Tātaritanga me ngā
tohutohu
Analysis and advice
13. In
the past six months progress with closing Treaty Audit recommendations was as
follows:
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Original (pre-2021)
recommendations needing action
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80
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Closed prior February 2022
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(76)
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Closed February 2022 –
August 2022
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--
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Open as at August 2022
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4
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Fourth Treaty Audit (2021)
recommendations
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13
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Closed since report was issued
11 August 2021
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--
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Open as at August 2022
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13
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Te Tiriti Audit Response Programme (Treaty Audits 1-3)
14. In
February 2022, the Risk and Assurance department reported an increase in the
rate of closure of audit recommendations.
15. Nevertheless
four of the 80 recommendations remain open. Two of the four open
recommendations have plans in place that will most likely lead to their closure
in the next six months. The other two open recommendations have approved project
plans in place which are being monitored by the Waharoa group.
The fourth Te Tiriti O Waitangi Audit
16. The 2021 treaty audit identified five observations. One observation
was rated high (with three recommendations) and four observations (with 10 recommendations)
were rated moderate. Observations are rated by IMSB and the external auditors
(who are commissioned to perform the audit).
17. These five
observations and 13 recommendations are summarised in the Treaty Audit Response
Programme 2021-2024 (Attachment A).
18. Project plans
have been developed, reviewed, and progressed towards implementation but have
not yet resulted in recommendations being closed. This is in part due to the
workforce challenges. Seven of the 13 recommendations are passed their due
date.
Tauākī whakaaweawe
āhuarangi
Climate impact statement
19. 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
20. The Treaty
Audit Response Programme work enables the Auckland Council group to strengthen
responsiveness to Māori through targeted actions and improvements described
in Auckland Council’s Māori Outcomes Framework. The Māori
Outcomes Framework is intended to provide clarity and guidance to the Auckland
Council group.
Ngā whakaaweawe
ā-rohe me ngā tirohanga a te poari ā-rohe
Local impacts and local board views
21. The views of
local boards have not been sought in relation to this report.
Tauākī whakaaweawe
Māori
Māori impact statement
22. The closure
of treaty audit findings through the Treaty Audit Response Programme will have
a positive impact on Māori as it leads to stronger responsiveness to
Māori through targeted actions and improvements described in the Māori
Outcomes Framework.
Ngā ritenga
ā-pūtea
Financial implications
23. The committee
is not being asked to make a decision with financial implications.
Ngā raru tūpono me
ngā whakamaurutanga
Risks and mitigations
24. Key risks to
achieving completion of the Treaty Audit Response Programme are:
· lack
of resources and capability (further impacted by Covid-19)
· lack
of oversight and monitoring of the work programme
· lack
of enhanced reporting (i.e. including comparative period data,
trend analyses, and progress against targets).
25. Key
mitigations of these risks include:
· clear
roles, responsibilities and commitments from the Action Owners and Action
Sponsors
· support
and guidance by Nga Mātārae
· oversight
and support by the Waharoa group (KOTM Enablement Board from 13 September 2022)
· six-monthly
reporting on progress to this committee.
Ngā koringa ā-muri
Next steps
26. The Risk and
Assurance department will continue to attend the Waharoa group meetings (and
the KOTM Enablement Board meetings after 13 September 2022) to encourage
progress towards implementation of the recommendations in the Treaty Audit
Response Programme 2021 – 2024 and to monitor progress.
27. The Risk and
Assurance department will report to this committee in accordance with the
Internal Audit Plan and this committee’s forward work programme.
Ngā tāpirihanga
Attachments
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No.
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Title
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Page
|
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a⇩
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Treaty Audit Response Programme 2021-2024
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15
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Ngā kaihaina
Signatories
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Author
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Emma Burke - General Manager Risk and Assurance
|
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Authoriser
|
Phil Wilson - Director, Governance & CCO
Partnerships
|
|
Audit and Risk
Committee
23 August 2022
|
|
|
Audit and Risk
Committee
23 August 2022
|
|
Forward Work Programme
File No.: CP2022/02829
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 best 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 for the committee.
3. The
following changes have been made to the work programme:
· the
Assurance Charter and the interim audit plan has been added to August 2022
· an
update of the Three Waters Reform programme will be provided to the Audit and
Risk Committee at the last committee meeting of the calendar year (date to be
confirmed)
· the
CRL update was duplicated in August and September 2022. This will be provided
at the September 2022 meeting
· the
Committee’s Annual performance report will be provided at the first
meeting of the new term for council for completeness instead of September 2022.
Ngā tūtohunga
Recommendation/s
That the Audit and Risk
Committee approve the Audit and Risk Committee forward work programme noting:
a) the
Assurance Charter and the interim audit plan has been added to August 2022
b) an
update of the Three Waters Reform programme will be provided to the Audit and
Risk Committee at the last committee meeting of the calendar year (date to be
confirmed)
c) the
CRL update was duplicated in August and September 2022. This will be provided
at the September 2022 meeting
d) the
Committee’s Annual performance report will be provided at the first
meeting of the new term for Council for completeness instead of September 2022.
Ngā tāpirihanga
Attachments
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No.
|
Title
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Page
|
|
a⇩
|
Forward Work Programme
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23
|
Ngā kaihaina
Signatories
|
Authors
|
Gemma Wensor - Risk Advisor
Ann Brown - Senior Risk Advisor
|
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Authorisers
|
Emma Burke - General Manager Risk and Assurance
Phil Wilson - Director, Governance & CCO
Partnerships
|
|
Audit and Risk
Committee
23 August 2022
|
|
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)
|
|
22 Feb
|
17 May
|
23 Aug
|
12 Sep
|
TBA
|
|
Forward work
programme
GM Risk and Assurance
|
Work
programme
Link to decision
|
Work
programme
Link to decision
|
Work
programme
|
Work
programme
|
Work
programme
Committee’s
Annual performance report
|
|
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
Link to decision - confidential
|
Assurance
Charter and interim audit plan
|
Assurance
activities update (fraud and integrity, internal audits, reviews and speak
up)
|
|
|
Independent Maori
Statutory Board - Treaty Audit
GM Risk and Assurance
|
Treaty Audit
Monitoring update
Link to decision
|
|
Treaty Audit
Monitoring update
|
|
Preparations
for Independent Māori Statutory Board upcoming 2022 Te Tiriti o
Waitangi Audit
|
|
Enterprise Risk
Risk Team
|
Enterprise
Risk Update
Link to decision
|
|
Enterprise
Risk Update
|
|
Enterprise
Risk Update
|
|
CCO Risk management
Risk Team
|
CCO
quarterly risk report
Attendance
by Auckland Transport
Link to decision - confidential
|
CCO
quarterly risk report
Attendance
by Eke Panuku
Link to decision - confidential
|
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 Auckland Transport, Auckland Unlimited, Eke Panuku and Watercare
|
CCO
quarterly risk report
Attendance
by Watercare
|
|
Ports of Auckland
Limited (POAL) Risk management
Risk Team
|
|
Ports of
Auckland Audit and Risk Activity Update May 2022
Link to decision
|
POAL risk
update
Attendance
by POAL
|
POAL annual
reports on risk (matters raised through annual audit process and summary of
any significant findings raised by auditors)
Attendance
by POAL
|
|
|
Auckland Council
partner/ shareholder risk management
Director
Infrastructure and Environmental Services & CCO/ External Partnerships
Dept
Chief of Strategy
|
|
|
|
City Rail
Link
|
Three
Waters Reform update
|
|
Health, Safety and
Wellbeing
Head of Health,
Safety and Wellbeing
|
Health,
safety and wellbeing update
Link to decision
|
Health,
safety and wellbeing update
Link to decision
|
Health,
safety and wellbeing update
|
|
Health,
safety and wellbeing update
|
|
Legal Risk
General Counsel
|
|
Legal Risk
report
Link to decision - confidential
|
|
|
Legal Risk
report
|
|
Insurance
Manager Insurance -
Risk and Insurance Dept
|
Update on
insurance activities
Link to decision
|
Indicative
Insurance Renewal Report
Link to decision - confidential
|
Update to
Committee post placement of Insurance Programme
|
|
|
|
Interim Report
Group Financial
Controller
|
31 December
2021 Interim Report NZX Announcement clearance
Link to decision - confidential
|
Audit New
Zealand Review engagement management report 31 December 2021
Link to decision
|
|
|
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
|
30 June 2022
Arrangements (extended audit plan)
Link to decision
|
NZX
Announcement 30 June 2022 / Annual Report 30 June 2022 update for committee
Proforma
Annual Report 30 June 2022 (financial statements and accounting policies)
Link to decision
Link to decision - confidential
|
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
|
|
Annual Budget
2022/2023
GM Financial Strategy
and Planning
|
|
Risk
management approach for the Annual Budget 2022/2023
Link to decision
|
|
|
|
|
Annual Green Bond
Report
|
|
Process for
Annual Green Bond Report 30 June 2022.
Link to decision
|
|
Annual Green
Bonds Report 30 June 2022.
|
|
|
Long Term Plan
2021/2031
Annual Plan
GM Financial Strategy
and Planning
|
|
|
|
|
2023/24
Annual Plan (draft)
|
|
External Audit
Office of
Auditor-General (OAG)
|
Briefing
paper provided
Link to decision - confidential
|
Briefing
paper provided
Link to decision - confidential
|
Briefing
paper provided
|
Briefing
paper provided
|
Briefing
paper provided
|
|
Audit and Risk
Committee
23 August 2022
|
|
Enterprise Risk Update August 2022
File No.: CP2022/10431
Te take mō te
pūrongo
Purpose of the report
1. To update the Audit and Risk Committee
on:
i) the status of and any changes to the
Auckland Council top risks assessed and evaluated in the period March 2022 to
July 2022
ii) the refreshed risk appetite statements
of Auckland Council
iii) risk management activities since the
last report to this committee in February 2022
iv) priorities for the next quarter.
Whakarāpopototanga matua
Executive summary
2. Auckland
Council’s top risk profile remains stable after all eleven top risks were
reviewed by the risk sponsors during the previous two months (and the ELT
collectively on 5 August 2022), including the refreshed risk appetite
statements.
3. Other
activities during the period have included the introduction of an external
Speak Up channel, leading the Risk Workstream as part of the Taskforce
for climate related financial disclosures (TCFD) project, and providing
risk support to the Three Waters project.
4. Our
primary focus remains on providing risk support and risk advice to the Auckland
Council’s directorates and Elected Members, along with reporting
significant matters to the relevant governance committees and bodies.
Ngā tūtohunga
Recommendation/s
That the Audit and Risk Committee:
a) note the Enterprise Risk Management
Activity Update – August 2022 report
b) refer the Enterprise Risk Management
Activity Update – August 2022 report to the Governing Body for
information.
Horopaki
Context
5. This report provides an update on
Auckland Council’s top risks, risk activities and risk management for the
period March to August 2022.
6. 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
7. The
Risk and Assurance department continues to work with the owners of actions to
improve top risk mitigations. This involves designing and implementing more
mitigations as part of ongoing efforts to continuously improve risk management
at Auckland Council. The top risks are reviewed six-monthly by ELT in accordance
with the Enterprise Risk Management Framework.
Emerging risks and heightened top risk drivers
8. There
were no new emerging top risks identified during the period since February
2022.
9. Although
Auckland Council’s top risk profile remains stable as reported above, the residual risk rating of four top risks (see table below) are
trending upwards due to heightened drivers. The trends are regarded as not
significant enough to justify a re-rating of these risks from High to Critical.
|
Top risk
|
Heightened key drivers contributing to increasing trend
|
|
Decision making
|
Election
period including increased public scrutiny and voter turnout.
|
|
Fraud & corruption
|
Emotionally
and financially stressed staff.
Stronger
drive to engage local suppliers to support the local economy.
Housing
market challenges.
|
|
Service delivery
|
Talent
acquisition and retention.
Disruptions
to and changing service delivery environment.
Economic
downturn leading to costs increasing.
|
|
Strategic relationships
|
Central
government do not consistently share information with council.
High
number of complex reforms that are not coordinated at central government
level.
|
10. The top risk
Financial trended upwards earlier in 2022 due to the impact of Covid on
Auckland Council. The ELT responded with a number of mitigations as previously
reported to ARC. ELT, through the Finance and Performance Committee, is
monitoring the effectiveness of these counter-measures. The current view is
that the Financial top risk is no longer trending upwards.
Risk appetite statements
11. In February
2022 the Risk team provided the committee with a timeline for refreshing
Auckland Council’s risk appetite statements. All risk appetite statements
were reviewed, and most of the
risk appetite levels stayed the same. The following changes were
approved by ELT:
i) The
Legal Compliance risk category has been revised from ‘Balanced’ to
‘Limited’ to reflect the reduced appetite for inadvertent
legislative breeches by Auckland Council.
ii) A
new additional appetite under the ‘Legal Compliance’ risk category
to specifically address deliberate non-compliance risk was approved by ELT. A
level of ‘no appetite’ was approved to reinforce our aim to remain
compliant with all legal obligations, avoiding breaches, fines and penalties.
iii) Two
risk appetite statements under ‘Māori Outcomes’ were
added, one relating to the achievement of the ten stated Māori Outcomes of
Auckland Council and a second, reflecting the risk of Auckland Council failing
to practice its Treaty of Waitangi obligations. Both have a ‘Balanced’
level of appetite. Refer to Attachment A.
iv) The
‘Integrity’ risk category has been renamed as ‘Conduct’
risk, and the ‘People’ risk category has been renamed as
‘Performance and Engagement’ risk to better match the name with
risk descriptions.
12. Attachment A
contains the updated risk appetite statements of Auckland Council with the
additions mentioned above highlighted. The
risk appetite levels were also updated with new names to avoid confusion with
the names of risk ratings. The previous and updated names and slight
adjustments to the wording of the levels are also provided in the last slide.
Covid 19 support
13. The Risk team
has had substantial input in supporting Auckland Council’s COVID-19
response over the past two years, as previously reported to the Audit and Risk
Committee. With the business unit Covid resilience plans in place, the
responsibility and management of the covid response efforts has now been
transferred to the Health, Safety and Wellbeing General Manager as a
‘business as usual’ function along with lessons learned. The
executive lead team continues to have oversight of the organisational impact of
COVID-19 and individual service lines are monitoring impact on services.
Speak Up confidential channel
14. Speak Up is a channel created to encourage people to raise concerns
who may have otherwise been hesitant.
15. Following the
Hauora review, a Speak Up refresh has taken place with oversight from the Speak
Up Governance Group. The improved Speak Up channel, including the addition of
an independent external channel, was communicated extensively over the last
quarter. The governance group and an operational group have been established to
help strengthen ongoing trust and confidence.
16. Reporting is being designed to monitor the nature of Speak Ups raised
and provide regular insights of key themes.
Taskforce for climate related financial disclosures (TCFD)
17. In order for the Auckland Council group to be ready to make its
first mandatory TCFD in the 2023/24 Annual Report, a work programme is underway
with actions to develop governance, risk management, strategies and measurement
approaches to climate change. A member of the Risk team is leading the risk
management workstream. This will help ensure close alignment with Auckland
Council’s enterprise risk management framework and to support
collaboration across the group.
Three Waters
18. Risk support
is being provided to the project lead for the Three Waters Transition Office. A
risk workshop was run in May 2022 which provided an initial overview of the
risks associated with the transition. Further risk reporting will be provided
to the Audit and Risk Committee at the December 2022 meeting, and ongoing risk
support will continue.
Legislative Compliance Framework
19. The review of
the legislative framework and underlying compliance plans is in the final
reporting stages. A summary of the key messages include:
· The legislative
framework document covers key aspects of good practice. The framework has a
clear purpose and supporting processes. It comprises 26 compliance areas each
allocated with a compliance lead and a compliance owner to manage compliance
obligations.
· Although the
framework is comprehensive, there are recommendations to further strengthen
compliance practices including training to compliance leads and additional
management reporting.
Ongoing risk capability building
20. As part of
increasing risk capability across the Auckland Council group, the last Risk
Kōrero was facilitated on 3 June 2022 with Risk Champions, General
Managers, and representatives from all council-controlled organisations. The
theme was “service delivery and resilience”. The focus was on
business resilience and how our service teams adapted to maintain service
levels.
Tauākī whakaaweawe
āhuarangi
Climate impact statement
21. Climate
change and its impacts remain a top risk for the council group and mitigations
and responses remain a priority for Auckland Council.
22. The Risk and
Assurance department continue to collaborate with the Chief Sustainability
Office, Finance Division, and relevant departments across the council group to
support Auckland Council’s adaptation and mitigation workstreams and to
progress with the group’s task force on climate-related financial
disclosures by 2023.
Ngā whakaaweawe me
ngā tirohanga a te rōpū Kaunihera
Council group impacts and views
23. The Risk and Assurance department
works with risk managers and key staff in the council-controlled organisations
to collaborate and manage group risks.
Ngā whakaaweawe
ā-rohe me ngā tirohanga a te poari ā-rohe
Local impacts and local board views
24. There are no
direct impacts on Local Boards.
Tauākī whakaaweawe
Māori
Māori impact statement
25. The delivery
of Māori Outcomes remains a key priority for Auckland Council. The
addition of the two risk appetite statements for specifically Māori
Outcomes and the Treaty of Waitangi will positively impact on the achievement
of the Māori objectives of Auckland Council. Refer to Attachment A.
Ngā ritenga
ā-pūtea
Financial implications
26. Financial management continues to be a
top risk for Auckland Council, and the risk team closely monitors the drivers
and impacts associated with this risk.
27. There are no financial costs
associated with the committee receiving this report on enterprise risk
management activities, and there are no funding decisions required.
Ngā raru tūpono me
ngā whakamaurutanga
Risks and mitigations
28. The top risks and mitigations for
Auckland Council are discussed within the main body of this report and within
the attachment.
29. Risk and Assurance continuously
reviews the external and internal environment to identify emerging or
heightened risks and trends.
Ngā koringa ā-muri
Next steps
30. The following are the focus areas for
risk management activities:
· Continued monitoring of Auckland
Council’s top risks and work with action owners to progress with risk
mitigations.
· Continuing focus on monitoring emerging
risks, heightened risk drivers and the impacts
· Leading
the development of the Auckland Council group approach to managing climate risk
in preparation for our mandatory disclosure under the taskforce for climate related
financial disclosure (TCFD).
· Operationalise
the risk appetite statements to support improved decision-making.
· Building risk management knowledge and
skills through training programmes.
· Ongoing risk support for key strategic
projects.
· Development of divisional risk
profiles for the remaining divisions and risk registers for departments and
identifying common risk themes across the divisions.
Ngā tāpirihanga
Attachments
|
No.
|
Title
|
Page
|
|
a⇩
|
Risk appetite statements July 2022
|
33
|
|
b⇩
|
Auckland Council Top Risks
|
37
|
Ngā kaihaina
Signatories
|
Authors
|
Andre de wet - Senior Risk Advisor
Ann Brown - Senior Risk Advisor
Alana Pribicevich - Risk Advisor
Gemma Wensor - Risk Advisor
|
|
Authorisers
|
Emma Burke - General Manager Risk and Assurance
Phil Wilson - Director, Governance & CCO
Partnerships
|
|
Audit and Risk
Committee
23 August 2022
|
|
|
Audit and Risk
Committee
23 August 2022
|
|
|
Audit and Risk
Committee
23 August 2022
|
|
Assurance Strategy, Assurance Charter
and Interim Audit Plan
File No.: CP2022/10704
Te take mō te
pūrongo
Purpose of the report
1. To
brief the committee on the development of the 2023-2025 Assurance Strategy and
updates to the Assurance Charter.
2. To
approve the interim 2022-2023 Internal Audit Plan.
Whakarāpopototanga matua
Executive summary
3. Following
the appointment of the new general manager of risk and assurance, the team is
developing the 2023-2025 Assurance Strategy and considering updates to the
Assurance Charter. These will be presented to the committee for approval at the
December 2022 meeting.
4. The
interim 2022-2023 Internal Audit Plan focuses on the audit team’s planned
activity until December 2022, after which the full 2022-2023 plan will also be
presented to the committee for approval at the December 2022 meeting.
Ngā tūtohunga
Recommendation/s
That the Audit and Risk
Committee:
a) note and
approve the interim 2022-2023 Internal Audit Plan
b) approve
the continued use of the current Assurance Charter until revision in December
2022.
Horopaki
Context
5. The
committee approved the 2019-2022 Assurance Strategy in August 2019.
6. The
committee approved the Assurance Charter in August 2021. Audit standards
require this to be approved annually.
7. In
addition, the committee approved the 2021/2022 Internal Audit Plan in August
2021. The Internal Audit Plan outlines the specific audit engagements and areas
of ongoing assurance performed by the audit function within the Risk and
Assurance department.
Tātaritanga me ngā
tohutohu
Analysis and advice
2023-2025 Assurance Strategy
8. The
2023-2025 Assurance Strategy is currently being considered. The audit team will
develop the strategy and present it to the December 2022 meeting for approval.
Assurance Charter
9. This
committee reviews and approves the Assurance Charter annually. This charter establishes
the mandate, scope of work, independence and accountabilities of the audit
function.
10. It is a
requirement of the Institute of Internal Audit (IIA) International Professional
Practices Framework that the committee approve this charter annually.
11. The audit
team is currently reviewing the charter, together with developing the 2023-2025
Assurance Strategy, and the updated charter will be presented for approval at
the December 2022 meeting.
12. In the
interim, staff ask the committee to approve that the existing charter, attached
in Attachment A, to continue to apply.
2022-2023 Internal Audit Plan
13. The audit
team provides independent assurance that council’s system of internal
controls is designed appropriately and operating as intended.
14. The interim
internal audit plan focuses on audit activity until December 2022, with an
indication of future focus areas. It is attached in Attachment B.
15. At the
December 2022 meeting we will present an updated plan covering the second half
of the financial year.
16. The plan
includes three different types of activity:
· audit
reviews: planned reviews covering a specific process or business unit,
resulting in an audit report with agreed corrective actions
· ‘real-time’
assurance, specifically probity reviews over current procurement processes,
with any risks being mitigated as they occur
· oversight
and advisory: ongoing liaison with business units to monitor status of critical
projects, key controls and emerging risks.
17. Approximately
a third of the team’s work is unplanned, driven by risk events or
issues, and investigations. The team regularly prioritises work based on
risk, which may result in changes to the audit plan over time.
Tauākī whakaaweawe
āhuarangi
Climate impact statement
18. There are no
climate change impacts arising from this report.
Ngā whakaaweawe me
ngā tirohanga a te rōpū Kaunihera
Council group impacts and views
19. The role of
the audit team is primarily to provide risk advice and assurance to Auckland
Council. However, we also collaborate with council-controlled organisations as
required, provide assurance services and advice at their request, and provide
assurance over processes and services used across the group.
20. The
relationship and working arrangements with the wider council group will be
described in the 2023-2025 Assurance Strategy.
Ngā whakaaweawe
ā-rohe me ngā tirohanga a te poari ā-rohe
Local impacts and local board views
21. The views of
local boards have not been sought in this report, or in the drafting of the
Internal Audit Plan 2022-2023.
Tauākī whakaaweawe
Māori
Māori impact statement
22. The audit
approach considers council’s obligations to Māori and the Treaty of
Waitangi as part of audit planning. We also provide oversight of specific
activities relating to obligations to Māori, such as council’s
response to the Treaty Audit.
23. Council’s
obligations to Māori and the Treaty of Waitangi are a core part of
‘Our Charter’. The Risk and Assurance department may
investigate and support staff who have spoken up about issues where decisions
and behaviours do not align with the principles in Our Charter.
24. The Risk and
Assurance role in relation to obligations to Māori and the Treaty of
Waitangi will be described in more detail in the 2023-2025 Assurance Strategy.
Ngā ritenga
ā-pūtea
Financial implications
25. There are no
financial implications as a result of this report. All activity associated with
drafting the 2022-2023 Internal Audit Plan have been met from within the Risk
and Assurance department budget.
Ngā raru tūpono me
ngā whakamaurutanga
Risks and mitigations
26. The function
of the interim Internal Audit Plan 2022-2023 is important to ensure council has
an appropriate and effective controls assurance function and effective probity,
fraud and integrity prevention processes and systems.
27. The proposed
direction set for assurance and audit activity is subject to feedback from both
the elected and independent members of this committee and from the Executive
Leadership Team of council.
Ngā koringa ā-muri
Next steps
28. Progress
against the interim 2022-2023 Internal Audit Plan will be reported to the
committee.
29. At the
December 2022 meeting, staff will present the 2023-2025 Assurance Strategy, the
Assurance Charter, and an updated 2022-2023 Internal Audit Plan for approval.
Ngā tāpirihanga
Attachments
|
No.
|
Title
|
Page
|
|
a⇩
|
Assurance Charter
|
57
|
|
b⇩
|
Interim Internal Audit Plan
|
61
|
Ngā kaihaina
Signatories
|
Author
|
Nick Rennie – Principal Advisor Audit and
Probity
|
|
Authorisers
|
Emma Burke - General Manager Risk and Assurance
Phil Wilson - Director, Governance & CCO
Partnerships
|
|
Audit and Risk
Committee
23 August 2022
|
|
|
Audit and Risk
Committee
23 August 2022
|
|
|
Audit and Risk
Committee
23 August 2022
|
|
Health, Safety and Wellbeing Report
File No.: CP2022/11449
Te
take mō te pūrongo
Purpose of the report
1. To
provide an update on initiatives underway to improve health, safety and
wellbeing, and the current state of selected key performance indicators
covering the period from December 2021 to June 2022.
Whakarāpopototanga matua
Executive summary
2. There
are several projects and initiatives underway across the council to improve the
health, safety and wellbeing of kaimahi (staff), and to deliver on the
recommendations of the hauora (wellbeing) review. These are broadly on track
and progressing well.
3. The
COVID-19 Omicron outbreak continues to require resources to support the health,
safety, and wellbeing of kaimahi.
4. Key
performance indicators are provided in Attachment A, covering the period from
December 2021 through to June 2022. This report provides further analysis on
these key indicators for the committee’s information.
Ngā tūtohunga
Recommendations
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 the committee
deems appropriate, and recommend that the Governing Body forwards this report
to local boards for their information.
Horopaki
Context
5. This
report provides commentary and a range of health, safety and wellbeing
performance indicators to enable the committee to provide objective advice.
6. Recommendations
on the adequacy and functioning of the council’s health, safety and
wellbeing risk management system and associated programmes are subsequently
shared with the Governing Body. Health, safety and wellbeing key performance
indicators are in Attachment A.
Tātaritanga me ngā
tohutohu
Analysis and advice
COVID-19
7. A
second wave of the Omicron variant has spread nationally, resulting in an
increase in case numbers, hospitalisations and deaths. Across the council, an
increased number of positive cases have been reported, however there have been
no significant clusters identified that indicate that infection events were
occurring within the workplace, aside from some limited spread within teams. At
the time of this report the number of reported cases has been decreasing,
consistent with nationally reported cases.
8. Some
services have been impacted due to staff absences, however a significant
contributor to those absences has been seasonal influenza and colds. COVID-19
Resilience Plans, as part of business continuity planning, have been in place
for some time and are demonstrating that the implemented controls are effective
at minimising disruption.
Project Hīra
9. Project
Hīra is the work programme underway to improve the management of health,
safety and wellbeing through the replacement of Risk Manager (our current
health and safety reporting system). This programme includes the procurement
and platform configuration elements of the project, alongside change
management, process improvement, people leader training and an awareness
campaign. This work will ensure that any changes are cooperatively designed,
value-adding, and sustainable.
10. The project
has progressed through configuration, and functional testing is nearing
completion for the incident and hazard management module. Preparations are
being made for the rollout of the system, and the training of staff and
leaders, prior to a release in September 2022.
11. As the system
approaches implementation, increased attention is being placed on the development
of forms and checklists within the system, and the development of a risk module
for the ongoing management of risks across Auckland Council. Future modules
will be implemented in 2023, including hazardous substance management,
contractor health, safety and wellbeing management, and injury management.
Hauora Review Recommendation: No Excuse for Abuse
12. The second
phase of the campaign is focussing on the management of violence and
aggression, in both understanding and mitigating the drivers of violent or
aggressive behaviours and in the development of tools and support systems to
reduce harm.
13. Workshops are
being held with kaimahi in higher-risk roles to identify opportunities to
improve controls. These workshops focus on the redesign of work tasks where
these contribute to escalation of aggressive behaviours, along with the
assessment of supporting tools and systems that are required.
14. Guidance
material to support kaimahi in staying safe has been published internally,
which provides advice to prevent or manage online and physical abuse. An
additional risk standard for the management of violence and aggression will be
developed through the critical risk programme, to create a suite of minimum
control requirements that are verifiable and can assist in assurance activity.
Hauora Review Recommendation: Speak Up
15. An external
channel for Speak Up is now operating and has been communicated across Auckland
Council to increase awareness of the process and the availability of the
channel. This channel is fully independent of Auckland Council and is available
to all employees 24/7. This sits alongside the existing confidential reporting
channels that exist which will give kaimahi choice about the channel they feel
most confident utilising.
16. Speak Up Kotahi pages have been updated to
explain the Speak Up process and advise employees on what they can
expect to happen when raising a Speak Up.
Contractor management
17. A full review
of contractor health, safety and wellbeing management has been completed, which
provides a view of current processes being used across Auckland Council and
council-controlled organisations. This review has identified a range of
operational improvements that can be made to strengthen the management of
health, safety and wellbeing for contractors engaged by Auckland Council.
18. Recommendations
have been made across the full contractor management lifecycle, from
prequalification and selection, through to onboarding, monitoring and review.
These recommendations aim to simplify, align and strengthen processes, while
also increasing the capability of those who manage contracted packages of work.
Critical risk management
19. A project to
enable more effective management of critical risks across the council is
underway. A pilot workshop stream has been undertaken to understand the
underlying factors and controls necessary for risks associated with mobile
plant. This risk has potential for fatal or life-altering injuries and is
present across several council operations.
20. The development
of risk controls and standards is being co-designed with a sample of frontline
staff and people leaders who are exposed to the risk, alongside subject-matter
experts, and health, safety and wellbeing staff.
21. Once the
pilot programme has established the control standards and verification process
for mobile plant and equipment, further workshops will be undertaken for other
risks, prioritised by the level of exposure that exists, and as documented in
the health, safety and wellbeing risk heat-map.
Incident numbers and mechanisms
22. The number of
health and safety incidents reported in June 2022 was 228 and continues the
trend of lower incident numbers over the past four months. The primary reason
for this change in reporting has been a decrease in issues relating to vaccine
passes, alongside the sale of the AIM Service business.
23. The main
theme is violence and aggression, and is consistent with previous reports.
These are predominantly low-level incidents, occurring mainly within libraries.
Risk Manager incident closure
24. Closure rates
for incidents within Risk Manager have increased to 75 per cent in June 2022
after a brief dip, however this is still below the targeted rate of 80 per
cent. Health, safety and wellbeing staff continue to work with people leaders
to ensure the focus remains on incident closure through the completion of any
necessary actions arising from the incident.
Tauākī whakaaweawe
āhuarangi
Climate impact statement
25. Te
Tāruke-ā-Tāwhiri: Auckland’s Climate Plan acknowledges
that if we do not take care of the environment, we are not taking care of our
own health and wellbeing. While there are no climate impacts specifically
arising from this performance report, the services the council provides, and
related health, safety and wellbeing risk controls will have varying climate
impacts that need to be considered on a case-by-case basis.
Ngā whakaaweawe me
ngā tirohanga a te rōpū Kaunihera
Council group impacts and views
26. This report
is based on Auckland Council organisation activities only, and does not provide
a group-wide view.
27. Health,
safety and wellbeing functions across the council group do collaborate on
common issues, such as ensuring visibility of approaches on COVID-19 policy
development and aligning on common improvement opportunities.
Ngā whakaaweawe
ā-rohe me ngā tirohanga a te poari ā-rohe
Local impacts and local board views
28. Like
Governing Body members, local board members are ‘officers’ under
the Health and Safety at Work Act 2015 and must exercise a duty of due
diligence in a way that reflects the nature and responsibility of their role.
29. It is
recommended that this report is referred to the Governing Body and (as with
previous health, safety and wellbeing reports) that the Governing Body then
forwards the report to local boards for their information.
Tauākī whakaaweawe
Māori
Māori impact statement
30. While
this performance report does not have specific impacts on Māori, staff
acknowledge the importance of taking a holistic, kaupapa Māori approach to
health and wellbeing.
31. In
particular, the hauora programme arising from the hauora (wellbeing) review is
utilising a kaupapa Māori approach, that reflects kaupapa Māori
values and interventions. The council’s wellbeing programme, Te Papa
Hauora, is based on 'Te Whare Tapa Whā', a holistic Māori health
model. This model acknowledges the different elements needed to sustain hauora,
including wairua (spiritual), hinengaro (mental and emotional), tinana
(physical), whānau (family and social), and whenua (land and roots).
Ngā ritenga
ā-pūtea
Financial implications
32. The work in
this report is being managed within current budgets, and there are no
additional financial implications to report.
Ngā raru tūpono me
ngā whakamaurutanga
Risks and mitigations
33. The risk of
non-compliance with health and safety is recorded in the council’s top
risk register. This risk register entry details the controls and mitigations in
place.
Ngā koringa ā-muri
Next steps
34. Following
the 23 August 2022 Audit and Risk Committee meeting, it is recommended that
this report be referred to the Governing Body for its information. It is also
recommended that the Governing Body forwards this report to local boards for
their information.
Ngā tāpirihanga
Attachments
|
No.
|
Title
|
Page
|
|
a⇩
|
Health, Safety and Wellbeing Performance Report - June
2022
|
69
|
Ngā kaihaina
Signatories
|
Author
|
Paul Robertson – General Manager Health Safety
and Wellbeing
|
|
Authorisers
|
Richard Jarrett - Director Group Services
Phil Wilson - Director, Governance & CCO
Partnerships
|
|
Audit and Risk
Committee
23 August 2022
|
|
The Auditor-General's report to
management on the interim audit for the year ended 30 June 2022
File No.: CP2022/11307
Te take mō te
pūrongo
Purpose of the report
1. To
summarise the matters identified by Audit New Zealand on behalf of the Deputy
Auditor-General during the interim audit for the year ended 30 June 2022 and
outline how Auckland Council is addressing the matters.
Whakarāpopototanga matua
Executive summary
2. The
Deputy Auditor-General has issued his report to management following the
completion of the interim audit. The report outlines areas in which internal
controls and financial disclosures can be improved.
3. There
is one new recommendation in the report, being that the council continues to develop its benefits management practices for capital
and operating expenditure.
4. Management accepts the recommendation and has provided a response
outlining the action being taken to address it.
Ngā tūtohunga
Recommendation/s
That the Audit and Risk
Committee:
a) note the
matters identified in the Deputy Auditor-General’s interim audit report
to management, for the year ended 30 June 2022, and management’s
responses.
Horopaki
Context
5. The
Deputy Auditor-General is Auckland Council and Auckland Council Group’s
external auditor, appointed by the Auditor-General to conduct the audit on his
behalf. He uses his staff and his appointed auditor’s staff (Audit New
Zealand) to review the statutory financial and performance reporting, and the
internal controls on which it is reliant.
6. On
completion of the interim audit, the Deputy Auditor-General provides a report
to management which outlines areas in which internal controls and financial
disclosures can be improved. The issued report, following completion of the 30
June 2022 interim audit of the group’s interim report, is attached
(Attachment A).
7. This
report summarises the matters identified by Audit New Zealand (on behalf of the
Deputy Auditor-General) during their interim audit for the year ended 30 June
2022 and outlines how management is addressing the matters.
Tātaritanga me ngā
tohutohu
Analysis and advice
8. Audit
New Zealand completed their second interim audit visit for the 2021/2022
financial year in May 2022. Their focus was on:
· updating
their understanding of the council’s systems and controls that support
financial and service performance information
· assessing
the effectiveness of those controls and of the overall control environment.
9. Key
messages relate to improvements required in the control environment and service
performance of building and resource consents.
10. There
is one new recommendation in the report. The recommendation is that the
Enterprise Portfolio Management Office (EPMO) develop the detailed benefits
improvement roadmap and an approach or strategy for reviewing capital and
operating expenditure (projects and programmes). It has a priority of
“necessary”.
11. Updates
were also provided on the following previously raised recommendations that are
still in progress:
|
Recommendation
|
Management’s
response
|
|
Review of
Delegated Financial Authority (DFA) Policy and SAP delegation
Management
should review identified breaches and if necessary, ensure these breaches are
regularised. Changes to DFAs should be property authorised and updated in
SAP.
|
Breaches have
been reviewed by the Risk and Assurance department and they have confirmed
all identified approvals were accurate and reasonable based on the roles of
the approvers held at the time and all breaches have appropriate reasons.
The Risk and Assurance
and Legal departments continue to review the Combined Chief Executives
Delegation Register to ensure
it meets council’s current needs and aligns with SAP.
|
|
Consenting
and service performance reporting
This is an
ongoing recommendation for the improvements in the recording and reporting of
compliance with statutory timeframes for the processing of resource consents.
|
The Resource
Consents department initiated a performance improvement programme in September
2021. This programme identified some key improvement initiatives to drive
efficiency through improved ways of working, including reducing and
reallocating administrative tasks.
In June 2022 we
increased staff numbers (by 14 FTE) within the Regulatory Support Unit to
provide additional administrative support to allow planners to focus on
processing applications, rather than administering SAP. This is expected to
improve document management to ensure accuracy of recorded performance in
future years.
Key changes are
being made to SAP to support improved accuracy.
|
|
Approvals of
the chief executive and mayor
One-up approval
is recommended.
|
The mayor does
not typically claim expenses or make purchases, and there has not been any
sensitive expenditure this year. The Mayor’s Office is aware of the
need for appropriate one-up approval.
|
|
Accounting treatment of COVID-19 costs
The council and
group ensure they continue to consider COVID-19 related costs on projects on
a case-by-case basis, and in particular, resolve the unadjusted $10.4 million
capitalised by Watercare.
|
Watercare
adjusted the $10.4 million of lockdown costs when the assets were revalued
during the year ended 30 June 2022.
|
|
Portfolio,
Programme and Project Management - Gateway reviews
Gateway reviews need to be applied consistently to
ensure they are effective.
|
There is a
timeline risk due to other priorities assigned to the EPMO by the ELT, and
also due to resignation, maternity leave, and sick leave requiring that we
revisit these dates.
Broader
portfolio governance is being reviewed, with a hub and spoke role in project
reviews, through gates is being considered.
Sponsor
training has been developed and piloted and is being revised based on
feedback and learnings.
|
12. Further,
the following previous recommendations prioritised as “Necessary”
will be followed up in during the final audit:
· Valuation
of investment properties - valuations should include better support such as
calculations, comparable sales and rental evidence provided to support certain
valuations.
· Valuation
of operational assets, restricted assets, and infrastructure assets - when
revaluing restricted land, the “chance of change” approach should
be considered where appropriate, and valuation reports should include better supporting
information.
· Climate
change - the council should continue to further develop climate change
reporting disclosures ahead of the proposed mandatory disclosure regime.
Tauākī whakaaweawe
āhuarangi
Climate impact statement
13. There are no items
covered in this report that impact on climate change.
Ngā whakaaweawe me
ngā tirohanga a te rōpū Kaunihera
Council group impacts and views
14. The
council-controlled organisations which use our SAP platform have been alerted
to the matter related to DFAs in SAP. Their structures tend to be simpler than
the council’s, however they have been going through restructures so will
need to consider the impact on their DFAs in SAP.
Ngā whakaaweawe
ā-rohe me ngā tirohanga a te poari ā-rohe
Local impacts and local board views
15. There are no
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 of or reporting on the group’s
contributions towards Māori outcomes. The group’s
contributions to Māori outcomes are reported in the annual report, and
there have been no recommendations in relation to that disclosure.
Ngā ritenga
ā-pūtea
Financial implications
17. There are no
financial implications directly arising from the information contained in this
report.
Ngā raru tūpono me
ngā whakamaurutanga
Risks and mitigations
18. The council
is actively addressing the issues raised. Apart from the matter related to
building and resource consents, management has assessed that the matters will
not impact on the audit opinion of the Auckland Council Group’s 2021/2022
annual report. Work is ongoing to assess the effect of the control gaps in the
consenting area on the audit opinion.
Ngā koringa ā-muri
Next steps
19. Management
will continue to follow up on its commitments to address the matters raised in
the audit report to management.
Ngā tāpirihanga
Attachments
|
No.
|
Title
|
Page
|
|
a⇩
|
OAG's Interim Audit Report to Management for 30 June
2022
|
77
|
Ngā kaihaina
Signatories
|
Authors
|
Tracy Gers - Group Accounting & Reporting Manager
Francis Caetano - Group Financial Controller
|
|
Authorisers
|
John Bishop - Group Treasurer
Peter Gudsell - Group Chief Financial Officer
Phil Wilson - Director, Governance & CCO
Partnerships
|
|
Audit and Risk
Committee
23 August 2022
|
|
|
Audit and Risk
Committee
23 August 2022
|
|
Auckland
Council Group's NZX preliminary announcement and financial results to 30 June
2022
File No.: CP2022/11433
Te take mō te
pūrongo
Purpose of the report
1. To
inform the Audit and Risk Committee of the process followed to prepare the draft
NZX announcement (including the group’s primary financial statements and
notes) and media release for the financial year ending 30 June 2022.
Whakarāpopototanga matua
Executive summary
2. The
draft Auckland Council Group NZX preliminary announcement (which includes the
group’s primary financial statements and notes) and media release
(collectively called the “draft 2022 NZX release”)
have been prepared for the financial year ended 30 June 2022.
3. This
report confirms the quality assurance processes undertaken in preparation of
the draft 2022 NZX release.
4. The
2022 NZX preliminary announcement will be released to the NZX on Monday 29
August 2022.
Ngā tūtohunga
Recommendation/s
That the Audit and Risk
Committee:
a) note
that there are no significant outstanding issues relating to
the process for the preparation of the draft 2022 NZX release
b) note the draft 2022 NZX release will be discussed later in this
meeting in confidence.
Horopaki
Context
5. The
Audit and Risk Committee reviews the quality of the annual reports and the
processes followed to prepare them. It liaises with Audit New Zealand to ensure
a robust audit of the Auckland Council Group.
6. The
Finance and Performance Committee reviews the financial and service performance
of the group.
7. This
report, the associated confidential item, comments from the Deputy
Auditor-General at this meeting and his briefing paper, assists the Audit and
Risk Committee to fulfil its duty as noted above.
8. Audit
New Zealand will report on any matters arising from the audit in their final
report, to those charged with governance, following completion of the audit.
9. In
accordance with the NZX listing rules, the group must lodge a results
announcement with the NZX within 60 days of the financial year-end.
10. The NZX
release is required to comply with Appendix 2 of the NZX Listing Rules.
Information required includes:
· a
statement of financial performance
· a
statement of financial position
· a
statement of cash flows
· a
statement of movements in equity
· commentary
on the results for the period, sufficient for a user to be able to compare the
results with the prior period
· a
statement as to whether the financial statements are audited, in the process of
being audited or not yet audited and details of any (likely) qualifications
· a
statement of accounting policies critical to the portrayal of the group’s
financial condition and results and required judgements and estimates about
uncertain matters
· the
impact of any changes in accounting policies.
11. The
draft 2022 NZX release is materially based on consolidated information obtained
from the council, council-controlled organisations and Ports
of Auckland Limited’s reporting packs.
Reporting packs have been supported by assurances obtained in representation
letters which were signed by their respective chief financial officer/chief
executive officers and chairs of their audit committee/boards.
12. At this
meeting, Audit New Zealand, on behalf of the Auditor-General as the group’s auditor, will confirm clearance on
the draft 2022 NZX release pursuant to the issue of
their opinion on the group’s annual report in September 2022.
Tātaritanga me ngā
tohutohu
Analysis and advice
13. The draft
2022 NZX release will be presented in the confidential NZX agenda item later in
this meeting.
14. The following reporting milestones provide an outline of the process
underway to prepare, review and issue the audited financial results for
year ended 30 June 2022.
Tauākī whakaaweawe
āhuarangi
Climate impact statement
15. This report relates to the
group’s financial statements only and as such has no climate
implications. Information relating to the group’s climate impact will be
included in the annual report and summary annual report.
Ngā whakaaweawe me
ngā tirohanga a te rōpū Kaunihera
Council group impacts and views
16. The draft
2022 NZX release consolidates financial information provided by the substantive
council-controlled organisations and Ports of Auckland Limited.
Ngā whakaaweawe
ā-rohe me ngā tirohanga a te poari ā-rohe
Local impacts and local board views
17. The draft
2022 NZX release relates to reporting at a group level. Accordingly, the views
of the local boards have not been sought.
Tauākī whakaaweawe
Māori
Māori impact statement
18. The report does not affect the achievement or reporting on the
council or 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
19. There are no
financial implications directly arising from the information contained in the
report as no financial decision is sought.
Ngā raru tūpono me
ngā whakamaurutanga
Risks and mitigations
Risk of error, omission or non-compliance in preparation of the
draft 2022 NZX release
20. There
is a risk that errors or inaccuracies could occur in the preparation of the
draft 2022 NZX release. To mitigate this risk, quality assurance reviews were
performed on the consolidated results and commentary
and the year-end reports. The reviews focused on accuracy, completeness and reasonableness of
disclosures, legislative compliance and adherence to Auckland Council
communications standards. A summary of the reviews is as follows:
|
Reviewer
|
Consolidated
results and commentary
|
Media release
|
Preliminary
NZX release
|
|
Group chief
financial officer
|
|
|
|
|
Group
treasurer
|
|
|
|
|
Group
financial controller
|
|
|
|
|
Manager
group accounting and reporting
|
|
|
|
|
Senior group
reporting technical accountant
|
|
|
|
|
Financial
accounting manager
|
|
|
|
|
General manager
financial strategy and planning
|
|
|
|
|
Manager
corporate performance reporting
|
|
|
|
|
Manager
Financial Stakeholder Relations
|
|
|
|
|
Senior
specialist corporate communications and media
|
|
|
|
|
Senior
solicitor and Mayne Wetherell
|
|
|
|
21. All
the quality assurance reviewers who performed reviews from a technical financial perspective are Chartered Accountant (CA) qualified or equivalent
and have the appropriate technical accounting skills and knowledge.
22. There
is a risk that significant matters that affect the financial performance,
financial position or cash flows of council-controlled
entities or Ports of Auckland Limited may not be adequately disclosed. To
mitigate this risk, the group financial controller has obtained short and long-form
representation letters from the respective chief
financial officer/chief executive officers and chairs of their audit
committee/boards which cover the completeness, accuracy and adequacy of
disclosures provided in their reporting. In addition, the group financial
controller will obtain updates from the respective chief financial officers
just prior to the release to the NZX to ensure nothing else has arisen since
the representation letters were signed, that could materially affect their
financial reporting disclosures.
Ngā koringa ā-muri
Next steps
23. The draft
2022 NZX release will be presented to the chair and deputy chair of the Finance
and Performance Committee on 25 August 2022 to recommend the mayor and chief
executive approve the documents be released on 29 August 2022.
24. The draft
2022 NZX release will then be presented to the mayor
and chief executive on 26 August 2022 for approval before release on
29 August 2022.
Ngā tāpirihanga
Attachments
There are no attachments for
this report.
Ngā kaihaina
Signatories
|
Authors
|
Tracy Gers - Group Accounting & Reporting Manager
Francis Caetano - Group Financial Controller
|
|
Authorisers
|
John Bishop - Group Treasurer
Peter Gudsell - Group Chief Financial Officer
Phil Wilson - Director, Governance & CCO
Partnerships
|
|
Audit and Risk
Committee
23 August 2022
|
|
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 August 2022
|
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 organsiations' 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:
Ports of Auckland Limited Risk Update August 2022
|
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 Ports of Auckland Limited's board or Audit and Risk
Committee. Ports of Auckland Limited 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.
|
C3 CONFIDENTIAL:
Council Group Post Insurance Renewal Update August 2022
|
Reason
for passing this resolution in relation to each matter
|
Particular
interest(s) protected (where applicable)
|
Ground(s)
under section 48(1) for the passing of this resolution
|
|
The public
conduct of the part of the meeting would be likely to result in the
disclosure of information for which good reason for withholding exists under
section 7.
|
s7(2)(h) -
The withholding of the information is necessary to enable the local authority
to carry out, without prejudice or disadvantage, commercial activities.
In
particular, the report contains confidential information with respect to
council's insurance arrangements, including premiums and cost benefits.
|
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:
Auckland Council Group's NZX preliminary announcement and financial results to
30 June 2022
|
Reason
for passing this resolution in relation to each matter
|
Particular
interest(s) protected (where applicable)
|
Ground(s)
under section 48(1) for the passing of this resolution
|
|
The public
conduct of the part of the meeting would be likely to result in the
disclosure of information for which good reason for withholding exists under
section 7.
|
s7(2)(h) -
The withholding of the information is necessary to enable the local authority
to carry out, without prejudice or disadvantage, commercial activities.
In
particular, the report contains information that will be included in the
annual report for the year ended 30 June 2022 which cannot be made public
until it is 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 financial results of Auckland
Council Group 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.
|
