Komiti mō te Tātari me te Mātai Tūraru /

Audit and Risk Committee

 

OPEN MINUTES

 

 

 

Minutes of a meeting of the Audit and Risk Committee held in Room 1, Level 26, 135 Albert Street, Auckland on Tuesday, 5 December 2023 at 2.06pm. A recording of the open meeting is available on:https://www.aucklandcouncil.govt.nz/about-auckland-council/how-auckland-council-works/meetings-council-bodies/Pages/webcasts-council-meetings.aspx

 

Te Hunga kua Tae mai | present

Chairperson

Paul Connell

 

Deputy Chairperson

Cr Lotu Fuli

In person until 4.56pm, Item C2, and then via electronic link

Members

Cassandra Crowley

Via electronic link

 

Cr Angela Dalton

 

 

Cr Christine Fletcher, QSO

Via electronic link

 

Cr Shane Henderson

Via electronic link

 

Martin Matthews

 

Ex-officio

Mayor Wayne Brown

 

 

Te Hunga Kāore i Tae Mai | ABSENT

 

Ex-officio

IMSB Member Tony Kake, MNZM

 

Deputy Mayor Cr Desley Simpson, JP

 

 

He Hunga atu anō i Tae mai | IN ATTENDANCE

 

 

David Taylor, Sector Manager - Auckland

 

Athol Graham, Audit Director, Audit New Zealand

 

 

 


Audit and Risk Committee

05 December 2023

 

 

 

Chairperson Paul Connell lead the opening of the meeting with a karakia.

 

1          Ngā Tamōtanga | Apologies

 

Resolution number ARCCC/2023/74

MOVED by Member M Matthews, seconded by Cr A Dalton:  

That the Audit and Risk Committee:

a)         whakaae / accept the apologies from:

Absence

IMSB Member Tony Kake, MNZM

CARRIED

 

 

 

2          Te Whakapuaki i te Whai Pānga | Declaration of Interest

 

            Chairperson Paul Connell declared that he was the Deputy Chair of International Accreditation New Zealand.

Member Cassandra Crowley declared that she was the Acting Chair of Waka Kotahi NZ Transport Agency and a Director of South Port New Zealand Limited.

 

 

 

3          Te Whakaū i ngā Āmiki | Confirmation of Minutes

 

Resolution number ARCCC/2023/75

MOVED by Cr A Dalton, seconded by Deputy Chairperson Cr L Fuli:  

That the Audit and Risk Committee:

a)       whakaū / confirm the ordinary minutes of its meeting, held on Friday, 15 September 2023, including the confidential section, as a true and correct record.

CARRIED

 

 

 

4          Ngā Petihana | Petitions

 

There were no petitions.

 

 

 

5          Ngā Kōrero a te Marea | Public Input

 

There was no public input.

 


 

 

6          Ngā Kōrero a te Poari ā-Rohe Pātata | Local Board Input

 

There was no local board input.

 

 

 

7          Ngā Pakihi Autaia | Extraordinary Business

 

There was no extraordinary business.

 

 

8

Forward Work Programme December 2023

 

Resolution number ARCCC/2023/76

MOVED by Chairperson P Connell, seconded by Deputy Chairperson Cr L Fuli:  

That the Audit and Risk Committee:

a)      whakaae / approve the Audit and Risk Committee Forward Work Programme 2023-2024, noting that the following changes have been made to the agenda of this 5 December meeting of the Audit and Risk Committee, in comparison to what was previously included as part of the forward work programme 2022-2023:

i)       an additional report to explain Regulatory Services statutory clock management

ii)      an additional report, ‘Final Audit Management Report for the Long-term Plan amendment 2023’, will provide an update to this committee on the Long-term Plan amendment to allow for the sale of Auckland Airport shares

iii)     a progress update will be presented to the committee on the ‘Climate Disclosure Work Programme’

iv)     an additional ‘Audit New Zealand final audit management report 30 June 2023’ will be presented at this committee

v)      an additional ‘Review arrangements 31 December 2023’ report will be presented at this committee

vi)     an additional ‘31 December 2023 Interim Financial Statements & NZX Announcement Update’ will be presented at this committee

vii)    an additional ‘Proforma interim financial statements and accounting policies 31 December 2023’ report will be presented at this committee

viii)   what was previously included on the forward work programme for this committee as ‘Risk management approach for the Annual Budget 2024/2025’ will now be reported as an update on the ‘Risk management approach to the Long-Term Plan 2024-2034’.

CARRIED

 

 


 

 

9

City Rail Link risk update

 

Note:   changes to the original motion were incorporated with the agreement of the meeting.

 

Resolution number ARCCC/2023/77

MOVED by Deputy Chairperson Cr L Fuli, seconded by Cr C Fletcher:  

That the Audit and Risk Committee:

a)      tuhi ā-taipitopito / note the City Rail Link Project risk and assurance update including the lessons learned from the project.

CARRIED

 

 

 

10

Health, Safety, and Wellbeing Performance Report

 

Resolution number ARCCC/2023/78

MOVED by Cr A Dalton, seconded by Member M Matthews:  

That the Audit and Risk Committee:

a)      tuhi ā-taipitopito / note the information in this report and the associated health, safety, and wellbeing indicators.

b)      whakaae / agree to refer this report to the Governing Body, and recommend that the Governing Body forwards this report to local boards for their information.

CARRIED

 

 

 

11

Statutory Clock Management update

 

Resolution number ARCCC/2023/79

MOVED by Deputy Chairperson Cr L Fuli, seconded by Cr A Dalton:  

That the Audit and Risk Committee:

a)      tuhi ā-taipitopito / note the information provided by the Director Regulatory Services.

CARRIED

 

 

 

12

Enterprise Risk Update December 2023

 

Resolution number ARCCC/2023/80

MOVED by Member M Matthews, seconded by Member C Crowley:  

That the Audit and Risk Committee:

a)      tuhi ā-taipitopito / note the Enterprise Risk Update – December 2023 report and updated strategic risks

b)      tūtohungia / recommend referring the Enterprise Risk Update – December 2023 report to the Governing Body for information.

CARRIED

 

 

 

13

Final Office of the Auditor-General report to governors for the year ended 30 June 2023

 

Resolution number ARCCC/2023/81

MOVED by Chairperson P Connell, seconded by Cr A Dalton:  

That the Audit and Risk Committee:

a)      tuhi a-taipitopito / note the matters identified by the Office of the Auditor-General in its report to governors for the year ended 30 June 2023, and Auckland Council’s responses to those matters.

CARRIED

 

 

 

 

14

Endorsement of the draft Office of the Auditor-General Interim Review Engagement Letter for the 6 months ended 31 December 2023

 

Resolution number ARCCC/2023/82

MOVED by Member M Matthews, seconded by Deputy Chairperson Cr L Fuli:  

That the Audit and Risk Committee:

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

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

c)      tono / request the mayor and chief executive sign the final interim review audit engagement letter.

CARRIED

 

 

 

 

15

Preparation of the interim report and NZX release for the six months ending 31 December 2023

 

Resolution number ARCCC/2023/83

MOVED by Deputy Chairperson Cr L Fuli, seconded by Cr A Dalton:  

That the Audit and Risk Committee:

a)      tuhi ā-taipitopito / 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 2023

b)      tuhi ā-taipitopito / 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

 

 

 

 

 

16

Climate disclosure work programme update December 2023

 

Resolution number ARCCC/2023/84

MOVED by Member M Matthews, seconded by Mayor W Brown:  

That the Audit and Risk Committee:

a)      tuhi ā-taipitopito / note the council’s progress towards compliance with climate disclosure standards and associated legislation which comes into effect for the year ended 30 June 2024.

CARRIED

 

 

 

 

17

Long-term Plan 2024-2034 (LTP) approach to risk and assurance

 

Resolution number ARCCC/2023/85

MOVED by Mayor W Brown, seconded by Cr A Dalton:  

That the Audit and Risk Committee:

a)         tuhi ā-taipitopito / note the update on the development of the Long-term Plan             2024-2034 including the approach to risk management

b)         tuhi ā-taipitopito / note the draft engagement letter from Audit New Zealand for             the audit of Auckland Council group’s consultation material and the Long-term             Plan 2024-2034

c)         tautapa / delegate to the chair of this committee authority to approve the final             engagement letter once it is received and make any recommendations to the             Mayor in relation to signing the letter.

CARRIED

 

 

 

 

18

Final Audit Management Report for the Long-term Plan Amendment 2023

 

Resolution number ARCCC/2023/86

MOVED by Member M Matthews, seconded by Deputy Chairperson Cr L Fuli:  

That the Audit and Risk Committee:

a)      whiwhi / receive the management report from the Office of the Auditor-General on the audit of the amendment to the 10-year Budget 2021-2031.

CARRIED

 

 

 

 

19        Te Whakaaro ki ngā Take Pūtea e Autaia ana | Consideration of Extraordinary Items

 

There was no consideration of extraordinary items.

 

 

 

 

 

20        Te Mōtini ā-Tukanga hei Kaupare i te Marea | Procedural motion to exclude the public

Resolution number ARCCC/2023/87

MOVED by Chairperson P Connell, seconded by Deputy Chairperson Cr L Fuli:  

That the Audit and Risk Committee:

a)      whakaae / agree to exclude the public from the following part(s) of the proceedings of this meeting.

b)      whakaae / agree that David Taylor, Sector Manager - Auckland and Athol Graham, Audit Director, 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: Substantive Council-Controlled Organisations' Quarterly Risk Update - December 2023

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 risks confidential to the substantive council-controlled organisations' boards or Audit and Risk Committees. The substantive council-controlled organisations have provided their risk reports for 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: Enterprise Risk Update December 2023

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 detailed information on the mitigation activities of the strategic risks that could be detrimental to risk management objectives if in the public domain.

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: Internal Audit 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.

s7(2)(c)(ii) - The withholding of the information is necessary to protect information which is subject to an obligation of confidence or which any person has been or could be compelled to provide under the authority of any enactment, where the making available of the information would be likely to damage the public interest.

In particular, the report contains information which if released would jeopardise the effective delivery of the Internal Audit 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.

 

 

 

 

C5       CONFIDENTIAL: Climate disclosure work programme update December 2023

Reason for passing this resolution in relation to each matter

Particular interest(s) protected (where applicable)

Ground(s) under section 48(1) for the passing of this resolution

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

s7(2)(j) - The withholding of the information is necessary to prevent the disclosure or use of official information for improper gain or improper advantage.

In particular, the report contains information about climate risks that could materially impact the Auckland Council Group's financial position in the future and have not yet been reported to the public.

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.

 

 

 

 

 

 

C6       CONFIDENTIAL: Interim report and NZX release for the six months ending 31 December 2023

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 and attachments contain information regarding the interim report and financial results of the Auckland Council Group to 31 December 2023 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.

 

C7       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 the Auckland Council Group and Auckland Council for 31 December 2023 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

 

 

3.58pm            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.

 

6.19pm            The public was re-admitted.

 

 

restatementS

 

It was resolved while the public was excluded:

 


 

 

C1

CONFIDENTIAL: Substantive Council-Controlled Organisations' Quarterly Risk Update - December 2023

 

Resolution number ARCCC/2023/88

MOVED by Mayor W Brown, seconded by Member M Matthews:  

That the Audit and Risk Committee:

a)      tuhi ā-taipitopito / note the written and verbal updates provided by Watercare Services Limited

b)      tuhi ā-taipitopito / note the written updates provided by Auckland Transport, Eke Panuku Development and Tātaki Auckland Unlimited

c)      tautohu / refer the Substantial Council-Controlled Organisations’ Quarterly Risk Update – December 2023 to the Council Controlled Organisations Direction and Oversight Committee, including the attachments relating to Eke Panuku Development, Tātaki Auckland Unlimited and Watercare Services Limited

d)      tautohu / refer the Substantial Council-Controlled Organisations’ Quarterly Risk Update – December 2023 to the Transport and Infrastructure Committee, including the attachments relating to Auckland Transport only

Restatement

e)      whakaae / agree that the decisions be released in the open minutes, but this report and its attachments remain confidential.

 

 

 

C2

CONFIDENTIAL: Legal Risk update

 

Resolution number ARCCC/2023/89

MOVED by Cr A Dalton, seconded by Mayor W Brown:  

That the Audit and Risk Committee:

a)      tuhi ā-taipitopito / note the Legal Risk update

Restatement

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

 

 

 

C3

CONFIDENTIAL: Enterprise Risk Update December 2023

 

Resolution number ARCCC/2023/90

MOVED by Member M Matthews, seconded by Cr A Dalton:  

That the Audit and Risk Committee:

a)      whiwhi / receive the contents of this confidential Enterprise Risk Update – December 2023 report

Restatement

b)      whakaae / agree that the decision be transferred to the open minutes but the report and attachments remain confidential.

 

 

 

 

C4

CONFIDENTIAL: Internal Audit Update

 

Resolution number ARCCC/2023/91

MOVED by Chairperson P Connell, seconded by Cr A Dalton:  

That the Audit and Risk Committee:

a)      tuhi ā-taipitopito / note the update on assurance activities performed by the Risk and Assurance department

Restatement

b)      whakaae / agree that the decisions be transferred to the open minutes, but the report and attachments remain confidential.

 

 

 

 

C5

CONFIDENTIAL: Climate disclosure work programme update December 2023

 

Resolution number ARCCC/2023/92

MOVED by Chairperson P Connell, seconded by Member M Matthews:  

That the Audit and Risk Committee:

a)      tuhi ā-taipitopito / note the council’s progress towards compliance with climate disclosure standards and associated legislation which comes into effect from 30 June 2024

Restatement

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

 

 

 

 

C6

CONFIDENTIAL: Interim report and NZX release for the six months ending 31 December 2023

 

Resolution number ARCCC/2023/93

MOVED by Member C Crowley, seconded by Member M Matthews:  

That the Audit and Risk Committee:

a)      tuhi ā-taipitopito / 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 2023

b)      ohia / endorse the accounting policies, key financial statements, judgements, estimates and assumptions for the Auckland Council Group included in the 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)      tono / request committee members provide any further feedback on the pro forma interim report to staff by 12 January 2024

d)      tautapa / delegate the authority to the committee chair and group chief financial officer to endorse any significant subsequent amendments to the interim report

e)      tuhi ā-taipitopito / note the draft responses to the enquiries by Audit New Zealand on the Audit and Risk Committee’s oversight of the management of fraud

f)       tono / request committee members provide further feedback on the fraud questionnaire to staff by 12 January 2024

Restatement

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

 

 

 

 

C7

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

 

Resolution number ARCCC/2023/94

MOVED by Chairperson P Connell, seconded by Cr A Dalton:  

That the Audit and Risk Committee:

a)      whiwhi / receive the information provided by the Auditor-General’s representatives, Sector Manager – Auckland David Taylor and Audit Director Athol Graham and thank them for their attendance

Restatement

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

 

 

 

 

 

Chairperson Paul Connell lead the closing of the meeting with a karakia.

 

 

 

 

 

 

6.19pm                                               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:.......................................................