IPSWICH
CITY
COUNCIL
AGENDA
of the
Audit and Risk Management Committee
Held in the Cunningham Room, Ipswich Civic Centre
Corner Nicholas and Limestone Street
IPSWICH QLD 4305
On Wednesday, 20 May 2020
At 1.00 pm to 3.30 pm
MEMBERS OF THE Audit and Risk Management Committee |
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External Member - Rob Jones (Chairperson) |
External Member - Martin Power External Member – Annette Quale Deputy Mayor Councillor Marnie Doyle Councillor Nicole Jonic
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Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
Audit and Risk Management Committee AGENDA
1.00 pm to 3.30 pm on Wednesday, 20 May 2020
Cunningham Room, Ipswich Civic Centre
Item No. |
Item Title |
Page No. |
1 |
Report - Audit and Risk Management Committee No. 2020(01) of 12 February 2020 |
10 |
2 |
Report - Risk ELT Meeting No. 2020(01) of 10 February 2020 |
19 |
3 |
Report - Risk ELT Meeting No. 2020(02) of 3 April 2020 |
27 |
4 |
**Outstanding actions |
37 |
5 |
**Queensland Audit Office Briefing Paper and 2020 Interim Report |
39 |
6 |
**Summary of Recent Internal Audit Reports Issued |
41 |
7 |
**Internal Audit Branch Activities Report for the period 4 February 2020 to 11 May 2020 |
44 |
8 |
**Progress of the 2019-2020 Annual Internal Audit Plan |
51 |
9 |
**Annual Internal Audit Plan for 2020-2021 including the Strategic Three Year Plan for 2020-2023 |
54 |
10 |
**Overdue Recommendations as at 11 May 2020 |
59 |
11 |
**Insurance and Risk Update |
63 |
12 |
Governance and Compliance Report |
79 |
13 |
ICT Strategy Update Report |
90 |
14 |
**Nicholas Street/CBD Redevelopment Update |
94 |
15 |
**ICT Platform Project - Update |
98 |
16 |
Corporate Program Management Office |
102 |
17 |
People & Culture Update |
124 |
18 |
Impact of New Accounting Standards - FY 2020 |
140 |
19 |
2019-2020 Asset Valuation - Update |
154 |
20 |
Next Meeting |
- |
21 |
General Business |
- |
22 |
Private Session of Member (if required) |
- |
** Item includes confidential papers
Audit and Risk Management Committee NO. 2
20 May 2020
AGENDA
1. Report - Audit and Risk Management Committee No. 2020(01) of 12 February 2020
This is the report of the Audit and Risk Management Committee No. 2020(01) of 12 February 2020.
Recommendation
That the report be received and the contents noted.
2. Report - Risk ELT Meeting No. 2020(01) of 10 February 2020
This is the report of the Risk ELT Meeting No. 2020(01) of 10 February 2020.
Recommendation
That the report be received and the contents noted.
3. Report - Risk ELT Meeting No. 2020(02) of 3 April 2020
This is the report of the Risk ELT Meeting No. 2020(02) of 3 April 2020.
Recommendation
That the report be received and the contents noted.
4. **Outstanding actions
This is a report concerning the
outstanding actions associated with the following committees:
Audit and Risk Management Committee
Risk ELT Committee
Risk – Infrastructure and Environment Committee
Risk – Corporate Services Committee
Risk – Co-ordination and Performance Committee
Risk – Planning and Regulatory Services Committee
Risk – Community, Cultural and Economic Development Committee
Recommendation
That the report be received and the contents noted.
5. **Queensland Audit Office Briefing Paper and 2020 Interim Report
This is a report concerning a briefing paper presented by the Queensland Audit Office together with the 2020 Draft Interim Report for Ipswich City Council.
Recommendation
That the report be received and the contents noted.
6. **Summary of Recent Internal Audit Reports Issued
This is a report concerning recently completed internal audits and the subsequent reports released since the previous report dated 4 February 2020.
Recommendation
That the report be received and the contents noted.
7. **Internal Audit Branch Activities Report for the period 4 February 2020 to 11 May 2020
This is a report concerning the activities of Internal Audit undertaken since 4 February 2020 and the current status of these activities.
Recommendation
That the report be received, the contents noted and the recommendations in Attachments 3, 4 and 5, be considered finalised and archived.
8. **Progress of the 2019-2020 Annual Internal Audit Plan
This is a report concerning the status of the 2019-2020 Annual Internal Audit Plan as presented in the attachment to this report.
Recommendation
That the report be received and the contents noted.
9. **Annual Internal Audit Plan for 2020-2021 including the Strategic Three Year Plan for 2020-2023
This is a report concerning the proposed Annual Audit Plan for 2020-2021 that includes the Strategic Three Year Internal Audit Plan for 2020-2023.
Recommendation
That the draft Internal Audit Annual Plan for 2020-2021 that includes the draft Strategic Three Year Internal Audit Plan for 2020-2023 (Attachment 2) as prepared by the Chief Audit Executive be considered and approved by the Audit and Risk Management Committee.
10. **Overdue Recommendations as at 11 May 2020
This is a report concerning the status of each Department's progress in actioning the internal and external audit recommendations due or overdue for implementation.
Recommendation
That the report be received and considered.
11. **Insurance and Risk Update
This is a report concerning Council’s Insurance Statistics for the period 1 January 2020 to 31 March 2020 and the implementation of Transformational Project Risk Management Framework (TP#7).
Recommendation
12. Governance and Compliance Report
This is a report concerning the performance of the Corporate Governance Section (the Section) in relation to Council’s legislative compliance in the management of Complaints, Right to Information and Information Privacy functions for the period 1 January 2020 to 31 March 2020 (the Quarter).
Recommendation
That the report be received and the contents noted.
13. ICT Strategy Update Report
This is a report concerning an update relating to the progress of implementation of the ICT Strategy 2019-2024. The strategy was published on 2 August 2019 and was developed in collaboration with a diverse range of internal stakeholders and includes stakeholder perspectives, key trends and influences, guiding principles and a strategy map.
Recommendation
That the report be received and the contents noted.
14. **Nicholas Street/CBD Redevelopment Update
This is a report concerning the progress of the Nicholas Street – Ipswich Central Project (the Project).
Recommendation
That the report be received and the contents noted.
15. **ICT Platform Project - Update
This is a report concerning the ICT Platform Project.
Recommendation
That the report be received and the contents noted.
16. Corporate Program Management Office
This is a report concerning the process, systems and controls currently in place to manage the delivery of the Business Transformation Program and other key strategic projects.
Recommendation
That the report be received and the contents noted.
17. People & Culture Update
This is a report to the Audit and Risk Management Committee on progress in the implementation of the People and Culture Strategic Plan 2019-2021.
Recommendation
That the progress in the implementation of the People and Culture Strategic Plan 2019-2021 be noted by the Audit and Risk Management Committee.
18. Impact of New Accounting Standards - FY 2020
This is a report concerning a request from the Queensland Audit Office (QAO) requiring Ipswich City Council (ICC) to provide a position paper regarding the impact of recently issued or amended accounting standards for Council and its controlled entities (Ipswich City Properties Pty Ltd (in Members Voluntary Liquidation), Ipswich City Enterprises Pty Ltd, Ipswich City Enterprises Investments Pty Ltd, Ipswich Arts Foundation, Ipswich Arts Foundation Trust and Cherish the Environment Foundation Ltd). In accordance with the key milestones agreed in the External Audit Plan, Council is required to provide the position paper to QAO by 31 May 2020.
Recommendation
That the report of the Principal Financial Accountant regarding the impact of the recently released or amended Accounting Standards for Ipswich City Council dated 27 April 2020 be received and the contents noted.
19. 2019-2020 Asset Valuation - Update
This is a report concerning the progress of the 2019-2020 asset valuation for land, buildings and infrastructure assets.
Recommendation
A. That the report of the Principal Financial Accountant regarding the progress of the 2019-2020 asset valuation for land, buildings and infrastructure assets be received and the contents noted.
B. That through the Audit and Risk Management Committee Chair, the final valuation report for 2019-2020 (to be finalised by mid-June 2020) be circulated to Committee Members for discussion and endorsement and if required a special Audit and Risk Management Committee meeting be convened to approve and endorse the report prior to 30 June 2020.
20. NEXT MEETING
The next meeting is scheduled for Wednesday, 19 August 2020.
21. GENERAL BUSINESS
22. PRIVATE SESSION OF MEMBER (IF REQUIRED)
** Item includes confidential papers
and any other items as considered necessary.
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 1
SUBJECT: Report - Audit and Risk Management Committee No. 2020(01) of 12 February 2020
AUTHOR: Committee Manager
DATE: 7 May 2020
This is the report of the Audit and Risk Management Committee No. 2020(01) of 12 February 2020.
That the report be received and the contents noted.
1. |
Audit and Risk Management Committee Report No. 2020(01) of 12 February 2020 ⇩ |
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 2
SUBJECT: Report - Risk ELT Meeting No. 2020(01) of 10 February 2020
AUTHOR: Committee Manager
DATE: 11 May 2020
This is the report of the Risk ELT Meeting No. 2020(01) of 10 February 2020.
That the report be received and the contents noted.
1. |
Report of Risk ELT Meeting of 10 February 2020 ⇩ |
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 3
SUBJECT: Report - Risk ELT Meeting No. 2020(02) of 3 April 2020
AUTHOR: Committee Manager
DATE: 7 May 2020
This is the report of the Risk ELT Meeting No. 2020(02) of 3 April 2020.
That the report be received and the contents noted.
1. |
Risk ELT Meeting Report No. 2020(02) of 3 April 2020 ⇩ |
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 4
SUBJECT: Outstanding actions
AUTHOR: Committee Manager
DATE: 12 May 2020
This is a report concerning the
outstanding actions associated with the following committees:
Audit and Risk Management Committee
Risk ELT Committee
Risk – Infrastructure and Environment Committee
Risk – Corporate Services Committee
Risk – Co-ordination and Performance Committee
Risk – Planning and Regulatory Services Committee
Risk – Community, Cultural and Economic Development Committee
That the report be received and the contents noted.
Not applicable
Listening, leading and financial management
This report provides an update as to current outstanding actions associated with the various risk committees operating within council.
This report and its recommendations are consistent with the following legislative provisions:
Not Applicable
Actions exist so that there is a record of matters that council has resolved. The actions exist as a way to ensure these tasks are undertaken.
Not applicable.
Not applicable.
The outstanding actions listing has been compiled as a record of actions still outstanding.
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CONFIDENTIAL |
1. |
Vicki Lukritz
Committee Manager
I concur with the recommendations contained in this report.
Sonia Cooper
General Manager Corporate Services
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 5
SUBJECT: Queensland Audit Office Briefing Paper and 2020 Interim Report
AUTHOR: Committee Manager
DATE: 11 May 2020
This is a report concerning a briefing paper presented by the Queensland Audit Office together with the 2020 Draft Interim Report for Ipswich City Council.
That the report be received and the contents noted.
Ipswich City Council
Queensland Audit Office
Listening, leading and financial management
The Queensland Audit Office have presented these two papers for the information of the Audit and Risk Management Committee.
This report and its recommendations are consistent with the following legislative provisions:
Not applicable
Not applicable
There are no financial or resource implications.
No consultation has been undertaken in relation to this report.
The Queensland Audit Office have presented a briefing paper and their 2020 draft Interim Report for the information of the Audit and Risk Management Committee.
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CONFIDENTIAL |
1. |
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2. |
Vicki Lukritz
Committee Manager
I concur with the recommendations contained in this report.
Sonia Cooper
General Manager Corporate Services
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 6
SUBJECT: Summary of Recent Internal Audit Reports Issued
AUTHOR: Chief Audit Executive
DATE: 11 May 2020
This is a report concerning recently completed internal audits and the subsequent reports released since the previous report dated 4 February 2020.
That the report be received and the contents noted.
Not applicable
The intention is for the Internal Audit activity to support all five themes:
Strengthening our local economy and building prosperity
Managing growth and delivering key infrastructure
Caring for the community
Caring for the environment
Listening, leading and financial management
Individual internal audits and corrupt conduct investigations will to a varying degree support these themes, but the main objective for Internal Audit is to support the organisation in achieving its objectives.
Since 11 May 2020, Internal Audit has issued/finalised 6 Internal Audit reports/Consulting Tasks and the extracts of the reports containing the audit recommendations, management response and agreed action by date, are attached to enable any further discussion that may be required by the Audit and Risk Management Committee.
Control Environment Opinion Summary over Areas in Scope of Audits |
5 |
4 |
3 |
2 |
1 |
Arrangements/Agreements/Leases (I&E non-construction) (A1920-01) |
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ü |
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Grants, Sponsorships and Donations Program (A1920-08) |
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ü |
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IMC Information Transfer (A1920-09) |
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ü |
Payroll Transactions (A1920-13) |
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ü |
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Receipting, Cash Handling and Floats (A1920-16) |
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ü |
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Workplace Safety and Wellbeing (A1920-23) |
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ü |
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Rating Definitions |
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5 |
Indicates unacceptable control environment or critical operating or control problems or extreme exposure. |
4 |
Indicates unsatisfactory control environment or significant operational, procedural or control deficiencies or high exposure. |
3 |
Indicates limited control environment or some operational, procedural or control deficiencies, issues or moderate exposure |
2 |
Indicates acceptable control environment or minor operational, procedural or control deficiencies, issues or exposure. |
1 |
Indicates well controlled environment or no or limited unfavourable audit findings, observations or exposure. |
Resources are provided to internal audit through the annual audit plan and budgeting processes. No additional resources were required because of this report.
Each of the individual reports provides for a control environment opinion as well as individual risk ratings per individual findings and recommendations. The importance is for management to implement the individual recommendations well to either address or diminish the exposure for Council, or explain why it is acceptable to not implement the suggested improvements. As per the corrupt conduct investigation, the findings and risks vary in each situation and are discussed in the confidential reports. Having said that the key risks are still a reality if the information is not well presented, well understood or does not generate an appropriate response.
This report and its recommendations are consistent with the following legislative provisions:
Local Government Act 2009
Local Government Regulation 2012
Internal Audit mostly consults internally to the organisation and its management in conducting the internal audits and finalising the reports.
Over this period it was still difficult to conduct audits and finalise reports mainly due to other priorities receiving preference. Having said that, through management and auditor cooperation things had improved.
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CONFIDENTIAL |
1. |
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2. |
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3. |
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4. |
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5. |
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6. |
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7. |
Freddy Beck
Chief Audit Executive
I concur with the recommendations contained in this report.
Freddy Beck
Chief Audit Executive
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 7
SUBJECT: Internal Audit Branch Activities Report for the period 4 February 2020 to 11 May 2020
AUTHOR: Chief Audit Executive
DATE: 11 May 2020
This is a report concerning the activities of Internal Audit undertaken since 4 February 2020 and the current status of these activities.
That the report be received, the contents noted and the recommendations in Attachments 3, 4 and 5, be considered finalised and archived.
Not applicable
The intention is for the Internal Audit activity to support all five themes:
Strengthening our local economy and building prosperity
Managing growth and delivering key infrastructure
Caring for the community
Caring for the environment
Listening, leading and financial management
Individual internal audits and corrupt conduct investigations will, to a varying degree, support these themes, but the main objective for Internal Audit is to support the organisation in achieving its objectives.
The purpose of this report is to keep the Audit and Risk Management Committee informed and to report on performance of the Internal Audit Branch:
• Report the status of the audits currently under way
• Summary of the activities of the Internal Audit Branch
• Annual Performance Report and Assertion on Internal Auditing Standards
• Report the status of the audit recommendations from completed audits
The supply of the information to the Mayor, the Chief Executive Officer and Audit and Risk Management Committee, is a requirement of the Internal Audit Charter.
Internal Audit Report Register (Attachment 1)
This is a historic register recording the reference number of formal reports produced, audits commenced, report status and date completed for the last number of years.
Audits, Reviews, Projects and Activities (Attachment 2)
This is a report on audits, reviews, projects and activities that were conducted during the period or in progress as at 11 May 2020.
Audit Recommendations (Attachments 3, 4 and 5)
Extracted from the Audit Recommendations System, these reports list all Internal and External Audit recommendations as well as de-identified Investigation/Ad-hoc reports (with management comments and responses) that managers advise have been implemented since the report made to the last Audit and Risk Management Committee meeting. These reports are presented to the Audit and Risk Management Committee prior to the recommendations being finalised and/or archived.
Resources are provided to internal audit through the annual audit plan and budgeting processes. No additional resources were required because of this report. However situations will dictate if internal audits and investigations have to be outsourced and also management will have to consider their implications to implement the recommendations as per the individual reports.
Each of the individual reports provides for a control environment opinion as well as individual risk ratings per individual findings and recommendations. The importance is for management to implement the individual recommendations well to either address or diminish the exposure for Council, or explain why it is acceptable to not implement the suggested improvements. As per the corrupt conduct investigation, the findings and risks vary in each situation and are discussed in the confidential reports. Having said that the key risks are still if the information is not well presented, well understood or does not generate an appropriate response.
This report and its recommendations are consistent with the following legislative provisions:
Local Government Act 2009
Local Government Regulation 2012
Crime and Corruption Act 2001
Internal Audit mostly consults internally to the organisation and its management in conducting the internal audits and finalising the reports. For investigations the appropriate consultations take place as the situation allows and requires.
During the period under review the Internal Audit Branch undertook a number of activities, including as listed in Attachment 2.
During the course of Internal Audit activities, contributions to the improvement of operational procedures, practices and the control environment have been achieved.
1. |
Internal Audit Register ⇩ |
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CONFIDENTIAL |
2. |
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3. |
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4. |
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5. |
Freddy Beck
Chief Audit Executive
I concur with the recommendations contained in this report.
Freddy Beck
Chief Audit Executive
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 8
SUBJECT: Progress of the 2019-2020 Annual Internal Audit Plan
AUTHOR: Chief Audit Executive
DATE: 11 May 2020
This is a report concerning the status of the 2019-2020 Annual Internal Audit Plan as presented in the attachment to this report.
That the report be received and the contents noted.
Not applicable.
The intention is for the Internal Audit activity to support all five themes:
Strengthening our local economy and building prosperity
Managing growth and delivering key infrastructure
Caring for the community
Caring for the environment
Listening, leading and financial management
Individual internal audits and corrupt conduct investigations will to a varying degree support these themes, but the main objective for Internal Audit is to support the organisation in achieving its objectives.
The attachment is an indication of the progress and indicating the number of actual audit days compared to the budgeted audit days in the approved audit plan, relative to various Internal Audit Branch activities undertaken during the year.
Resources are provided to internal audit through the annual audit plan and budgeting processes. No additional resources were required because of this report. However situations will dictate if internal audits and investigations have to be outsourced and also management will have to consider their implications to implement the recommendations as per the individual reports.
Each of the individual reports provides for a control environment opinion as well as individual risk ratings per individual findings and recommendations. The importance is for management to implement the individual recommendations well to either address or diminish the exposure for Council, or explain why it is acceptable to not implement the suggested improvements. As per the corrupt conduct investigation, the findings and risks vary in each situation and are discussed in the confidential reports. Having said that the key risks are still if the information is not well presented, well understood or does not generate an appropriate response.
This report and its recommendations are consistent with the following legislative provisions:
Local Government Act 2009
Local Government Regulation 2012
Internal Audit mostly consults internally to the organisation and its management in conducting the internal audits and finalising the reports. For investigations the appropriate consultations take place as the situation allows and requires.
The Internal Audit Branch continued to have another demanding year due to the push to transform the organisation, requirements regarding corrupt conduct investigations and the current disruption to normal activities.
There were six carryover internal audits from the previous year completed in this financial year.
Five internal audits in this year’s plan have been postponed. These were mainly postponed into the next financial year due to the workload and being affected by the level of change in the organisation.
Asset Management in the organisation had not progressed far enough yet, Procurement was in the middle of centralisation, the Libraries were in the middle of completing two new Libraries including a change of branch manager and therefore the first two were moved to the next financial year and Libraries to 2021-2022. Financial Control; and Information and Related Technology on-boarding were also moved to next year due to work demands and readiness of the respective areas. Although the pandemic has had an effect on the organisation and availability it did not have a huge effect on the productivity of the internal audit activity due to good staff, technical support from Information, Communications and Technology and other support.
With the carry overs from the previous year added it is expected that the Internal Audit Branch will still complete about 18 of the 23 planned Internal Audit Reports/Projects/Consulting Tasks and 20 Investigations projects for the year. The total jobs completed will then be in the range of 38 to exceed the expected number of jobs of 32⅛.
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CONFIDENTIAL |
1. |
Freddy Beck
Chief Audit Executive
I concur with the recommendations contained in this report.
Freddy Beck
Chief Audit Executive
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 9
SUBJECT: Annual Internal Audit Plan for 2020-2021 including the Strategic Three Year Plan for 2020-2023
AUTHOR: Chief Audit Executive
DATE: 11 May 2020
Executive Summary
This is a report concerning the proposed Annual Audit Plan for 2020-2021 that includes the Strategic Three Year Internal Audit Plan for 2020-2023.
Recommendation/s
That the draft Internal Audit Annual Plan for 2020-2021 that includes the draft Strategic Three Year Internal Audit Plan for 2020-2023 (Attachment 2) as prepared by the Chief Audit Executive be considered and approved by the Audit and Risk Management Committee.
RELATED PARTIES
Not applicable.
Advance Ipswich Theme Linkage
The intention is for the Internal Audit activity to support all five themes:
Strengthening our local economy and building prosperity
Managing growth and delivering key infrastructure
Caring for the community
Caring for the environment
Listening, leading and financial management
Individual internal audits and corrupt conduct investigations will to a varying degree support these themes, but the main objective for Internal Audit is to support the organisation in achieving its objectives.
Purpose of Report/Background
This report is submitted for review and to approve the proposed draft Internal Audit plan.
The Internal Audit Charter requires that:
“3. Scope, Roles and Responsibilities
3.1 The scope of internal auditing is to determine whether the organisation’s governance, risk management and control processes, as designed and represented by management, are adequate and operating effectively so that the organisation’s objectives can be achieved. It includes, but is not necessarily limited to, the following:
3.1.1 Internal audit planning must be sufficiently comprehensive to audit/review all key facets of Council’s operations, having regard to the functions and duties imposed on Council.
3.2 The scope of internal audit function extends to include all departments, programs, sub‐programs, functions, funded schemes and entities over which Council has direct management, sponsorship or financial control.
6. Authority
6.3 The Chief Audit Executive and staff of the Internal Audit Branch are authorised to review all areas of Council and to have full, free, and unrestricted access to all Council's activities, records (both manual and electronic), property, and personnel. Council activities include entities over which Council has direct management, sponsorship or financial control.
6.5 It is the policy of Council that all internal audit activities remain free of influence by any organisational elements. This will include such matters as scope of internal audit programs, the frequency and timing of examinations and the content of internal audit reports.
7. INTERNAL AUDIT APPROACH
7.2 Risk Profile, Three Year Strategic and Annual Internal Audit Plans:
7.2.1 The Internal Audit Branch, in consultation with management, will consider Council’s Risk Management Framework as well as the Strategic and Departmental risks so that greater audit attention can be directed to areas of higher risk.
7.2.2 Using these key risks as a basis while considering mitigation processes and controls, the general direction of Council's internal audit activities over the medium term is to be documented in the Three Year Strategic Internal Audit Plan. This plan shall be reviewed by the CEO and approved by the Audit and Risk Management Committee. The Plan will also be reviewed annually to take account of any change in circumstances.
7.2.3 The Annual Audit Plan projects may include financial, compliance, performance, due diligence, information systems, program evaluation, operational audits and other approaches as deemed appropriate, given the resources and also the priorities established through the risk assessment process and other more recent considerations.
7.3 Responsibilities and Auditing Standards1:
7.3.2 Specific standards which are to be followed include:
• Internal Audit staff must maintain an independent outlook and must ensure their independence to plan, investigate and report with honesty and objectivity.
1 Standards includes as follows: The Institute of Internal Auditors’ Core Principles for the Professional Practice, Definition of Internal Auditing, Code of Ethics and the International Standards for Professional Practice (Standards). This also includes the Information Systems Audit and Control Association’s Statements on Information Systems Auditing Standards.
Internal Audit attended the corporate and departmental risk workshops in reviewing the risk assessment for internal audit planning purposes. As a consequence of these discussions, the more significant risks and an indication of the key controls that are relied upon in determining auditable areas within the organisation have been identified and is summarised in the Strategic Three Year Audit Plan.
This proposed Internal Audit Program was presented at the Executive Leadership Team meeting of 5 May 2020 and is now tabled at the meeting of the Audit and Risk Management Committee for consideration and approval.
Financial/RESOURCE IMPLICATIONS
Resources are provided to internal audit through the annual audit plan and budgeting processes. No additional resources are considered at this moment in time. However situations will dictate if internal audits and investigations have to be outsourced and also management will have to consider their implications to implement the recommendations as per the individual reports.
RISK MANAGEMENT IMPLICATIONS
Each of the individual reports provides for a control environment opinion as well as individual risk ratings per individual findings and recommendations. The importance is for management to implement the individual recommendations well to either address or diminish the exposure for Council, or explain why it is acceptable to not implement the suggested improvements. As per the corrupt conduct investigation, the findings and risks vary in each situation and are discussed in the confidential reports. Having said that the key risks are still a reality if the information is not well presented, well understood or does not generate an appropriate response.
Legal/Policy Basis
This report and its recommendations are consistent with the following legislative provisions:
Local Government Act 2009
Local Government Regulation 2012
Crime and Corruption Act 2001
Internal Audit is constituted as per the Local Government Act 2009 and Local Government Regulation 2012 and the following are the requirements in relation to the internal audit plan:
Part 11 |
Auditing |
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Division 1 |
Internal audit function |
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Subdivision 1 |
Internal auditing and reporting |
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207 |
Internal audit |
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Requirement |
Section in Plan |
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(1) For each financial year, a local government must— |
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(a) prepare an internal audit plan; |
The whole annual and strategic audit plan |
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(2) A local government’s internal audit plan is a document that includes statements about— |
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(a) the way in which the operational risks have been evaluated; and |
3, 5 and 6 |
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(b) the most significant operational risks identified from the evaluation; and |
7, 11, 12 and 13 |
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(c) the control measures that the local government has adopted, or is to adopt, to manage the most significant operational risks. |
7, 8, 9, 10 and 13 |
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COMMUNITY and OTHER CONSULTATION
Internal Audit mostly consults internally to the organisation and its management in conducting the internal audits and finalising the reports. For investigations the appropriate consultations take place as the situation allows and requires.
Conclusion
The process of audit planning by the Chief Audit Executive has been completed and has been reviewed by Council’s Executive Leadership Team.
Attachments and Confidential Background Papers
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CONFIDENTIAL |
1. |
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2. |
Annual 2020-2021 and Strategic 2020-2023 Internal Audit Plan |
Freddy Beck
Chief Audit Executive
I concur with the recommendations contained in this report.
Freddy Beck
Chief Audit Executive
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 10
SUBJECT: Overdue Recommendations as at 11 May 2020
AUTHOR: Chief Audit Executive
DATE: 11 May 2020
This is a report concerning the status of each Department's progress in actioning the internal and external audit recommendations due or overdue for implementation.
That the report be received and considered.
Not applicable
The intention is for the Internal Audit activity to support all five themes:
Strengthening our local economy and building prosperity
Managing growth and delivering key infrastructure
Caring for the community
Caring for the environment
Listening, leading and financial management
Individual internal audits will, to a varying degree, support these themes, but the main objective for Internal Audit is to support the organisation in achieving its objectives.
Every month each Department Head is requested to update the status of both the internal and external audit recommendations due for implementation within their area of responsibility.
Traffic lights have been introduced based on the request of the Audit and Risk Management Committee. The following is an indication of what each indicator could mean:
Light |
Green |
Light |
Orange |
Light |
Red |
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Under control Reasonable number Low overall risk |
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Need to monitor Number increasing Moderate overall risk |
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Need to be addressed Number problematic High overall risk |
The following Departments’ progress towards the implementation of Internal Audit recommendations, for which they are responsible, is summarised below:
Corporate Services |
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Date of Report |
Total overdue |
Catastrophic |
High |
Moderate |
|
11 May 2020 |
1 |
0 |
0 |
1 |
|
In relation to: Credit Cards Framework‐ Allocation and Use (A1819-05) |
Planning and Regulatory Services |
|
||||
Date of Report |
Total overdue |
Catastrophic |
High |
Moderate |
|
11 May 2020 |
4 |
0 |
0 |
2 |
|
In relation to: Immunisation Program (A1718-11), Residential Swimming Pools (A1718-16), Penalty Infringement Process (A1819-13), Animal Management Branch – Pound Operations (A1819-15) |
All other departments had no recommendations overdue for more than 3 months.
Resources are provided to internal audit through the annual audit plan and budgeting processes. No additional resources are required because of this report. However management will have to consider their implications to implement the recommendations as per the individual reports.
Each of the individual reports provides for a control environment opinion as well as individual risk ratings per individual findings and recommendations. The importance is for management to implement the individual recommendations well to either address or diminish the exposure for Council, or explain why it is acceptable to not implement the suggested improvements.
This report and its recommendations are consistent with the following legislative provisions:
Local Government Act 2009
Local Government Regulation 2012
Internal Audit mostly consults internally to the organisation and its management in conducting the internal audits and finalising the reports.
Total Internal Audit recommendations overdue for more than 3 months and level of risk:
Minimal and Low not indicated.
Date of Report |
Total overdue |
Catastrophic |
High |
Moderate |
|
11 May 2020 |
5 |
0 |
0 |
3 |
|
4 February 2020 |
15 |
0 |
1 |
8 |
Total Internal Audit recommendations open and level of risk:
Date of Report |
Total open |
Catastrophic |
High |
Moderate |
|
11 May 2020 |
60 |
0 |
6 |
40 |
|
4 February 2020 |
32 |
0 |
1 |
21 |
Total External Audit recommendations overdue and level of risk:
Ratings as used by QAO.
Date of Report |
Total overdue |
High |
Moderate |
Low |
|
11 May 2020 |
1 |
1 |
0 |
0 |
|
4 February 2020 |
6 |
1 |
2 |
3 |
Total External Audit recommendations open and level of risk:
Date of Report |
Total open |
High |
Moderate |
Low |
|
11 May 2020 |
7 |
3 |
2 |
2 |
|
4 February 2020 |
7 |
2 |
2 |
3 |
Total Investigation/Ad Hoc Report recommendations overdue and level of risk:
Minimal and Low not indicated.
Date of Report |
Total overdue |
Catastrophic |
High |
Moderate |
|
11 May 2020 |
3 |
0 |
0 |
2 |
|
4 February 2020 |
2 |
0 |
0 |
1 |
Total Investigation/Ad Hoc Report recommendations open and level of risk:
Date of Report |
Total open |
Catastrophic |
High |
Moderate |
|
11 May 2020 |
3 |
0 |
0 |
2 |
|
4 February 2020 |
6 |
0 |
0 |
4 |
Overall Status |
|
The total number of overdue recommendations have gone down, but the overall number of open recommendations have gone up significantly. This is a positive result for the moment, but managers will need to monitor the open recommendations. |
Freddy Beck
Chief Audit Executive
I concur with the recommendations contained in this report.
Freddy Beck
Chief Audit Executive
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 11
SUBJECT: Insurance and Risk Update
AUTHOR: Principal Risk and Compliance Specialist
DATE: 27 April 2020
This is a report concerning Council’s Insurance Statistics for the period 1 January 2020 to 31 March 2020 and the implementation of Transformational Project Risk Management Framework (TP#7).
All members of ELT, Business Transformation Program Steering Committee members, Council’s third level Managers. Principal Risk and Compliance Specialist, Senior Insurance Officer and the Corporate Governance Manager. There are no perceived conflict of interest issues regarding this report.
Listening, leading and financial management.
To inform the Committee of:
1. Corporate Insurance Statistics for the Quarter
2. Status of Transformation Project Risk Management TP#7
1. Corporate Insurance Statistics for the period 1 January 2020 to 31 March 2020
The following tables and graphs provide a high-level summary of insurance claims for the period (refer Attachment No. 1 and No. 2 for detail):
2. Status of Transformational Project No. 7 Risk Management Framework (TP#7)
The purpose of the TP#7 project was to develop a better practice and consistent whole of Council approach to Enterprise Risk Management (ERM) in order to proactively identify, manage and respond to issues that represent risks to achieving Council’s strategic objectives. The TP#7 Project was finalised as at 31 March 2020.
The project consisted of five (5) sub-projects:
1. Enterprise Risk Management program (ERM Program)
2. Fraud and Corruption Control Program (FCCP)
3. Good Decision Making and Ethics Principles
4. Business Continuity Planning (BCP)
5. Project Risk Management Model
SUB-PROJECT UPDATES AS AT 31 MARCH 2020;
1. Enterprise Risk Management Program (ERM Program)
· First ELT Risk Committee held on 10 February 2020 and the second ELT Risk Committee was held on 3 April 2020.
· The first Departmental Risk Advisory Committee for each of the five Departments was held in the third week of March 2020 with the Committee being chaired by the General Manager. All the five Committees endorsed the Advisory Committee Terms of Reference.
· Charlie Dill, GM Infrastructure and Environment will be presenting at today’s committee on how he is managing his departmental risks.
Corporate Risk Register
A review was undertaken to review the risk descriptions, the causes, the impacts, likelihood and consequence ratings and the development of the action plans for the eight risks which are the primary area of focus for review at the February 2020 and April 2020 ELT Risk Committee. At Attachment No. 3 is: ICC Corporate Risk Register.
Departmental Risk Registers
A review was undertaken of the five Departmental risk registers to review the risk descriptions, the causes, the impacts, likelihood and consequence ratings and the development of the action plans for the risks which are the primary area of focus for each Department for review at the March 2020 Departmental Risk Advisory Committee and April 2020 ELT Risk Committee.
Risk Profile
Due to the COVID-19 Pandemic the CEO at the ELT Risk Committee held on 3 April 2020 suggested that the corporate risks are retained and further discussed once the threat of COVID-19 has lessened.
Risk Appetite
At the ELT Risk Committee held on 3 April 2020 ELT endorsed the proposed PWC “Draft” Risk Appetite Statement (RAS) for use in executive decision-making.
The Principal Risk and Compliance Specialist outlined that it is proposed to do a more in-depth analysis for the nine (9) risk areas during 2020 and that for the next ELT Risk meeting there will be discussion around how Council can look at compiling a risk appetite for Council covering these nine (9) risk areas.
Reporting
Work is still progressing with the reporting timeframes and reporting templates.
Implementation of the Risk Management Framework and Training
The risk management training is in the process of being developed by the Learning and Development Section within the People and Culture Branch based on the Framework, Procedure and Administrative Directive and will be rolled out commencing in the third quarter of 2020.
2. Fraud and Corruption Control
The ELT Risk Committee held on 3 April 2020 noted that the Fraud and Corruption Training for ELT/Branch and Section Managers and key staff was carried out by PWC in four sessions on 19 and 20 February 2020 involving 100 staff. General Managers were also able to nominate key staff from their Department and Finance were able to secure funding for PWC’s engagement.
Further Fraud and Corruption Training for all Ipswich City Council Staff will be rolled out commencing in the third quarter of 2020.
Fraud and Corruption Control Risk Register
The ELT Risk Committee held on 10 February 2020 endorsed the ICC Fraud and Corruption Control Risk Register.
Reporting
Work is still progressing with the reporting timeframes and reporting templates.
3. Good Decision-Making and Ethics Principles
Due to resource issues all other key deliverables/planned outcomes are work in progress. The project schedule for this sub-project will be reviewed and new deliverable dates approved by the ELT Risk Committee.
4. Business Continuity Planning
The ELT at its meeting on 23 March 2020 endorsed that due to the current circumstances in relation to the COVID-19 Pandemic, that the planned development of a business continuity test exercise, which was to be carried out in the first half of 2020 be postponed.
At the ELT Risk Committee held on 3 April 2020 the CEO requested that a date be pencilled in towards the end of the year and this is to be used as an exercise that reflects on current COVID-19 actions.
At the ELT Risk Committee held on 3 April 2020 the committee endorsed the CEO’s request that the Principal Risk and Compliance Specialist prepare a separate risk register for COVID-19 as a priority, a simple document outlining 3 or 4 risks, including financial risks to the organisation, risk to staff and risk to the economy for a COVID-19 briefing with the incoming councillors.
5. Project Risk Management Model
Completed and now operationalised and BAU.
In managing risk and insurance for the organisation Council officers perform their duties in keeping with the Local Government Principles of:
· Transparent and effective processes, and decision-making in the public interest;
· Good governance of, and by, local government; and
· Ethical and legal behaviour of Councillors and local government employees
The following table outlines the relevant legislation and the administrative functions and services provided by the Section:
Relevant Legislation |
Corporate Services Section Functions and Services Provided |
Local Government Act 2009 Local Government Regulation 2012 AS/NZS ISO 31000:2018 Risk Management – Principles and Guidelines
|
Manage and coordinate:
· the implementation of Council’s Risk Management Framework · public liability claims from external customers · public liability claims for Councillors and staff · negotiate (within Delegated Authority), on behalf of Council any insurance resolutions · the insurance of Council assets including but not limited to Council buildings, machinery and equipment, park infrastructure, swimming pools, sports centres, club houses, fleet vehicles, etc. · the renewal of Council insurance policies (excluding Workers Compensation) · the provision of expert insurance and risk advice to both external and internal stakeholders · recover costs from damaged made by third parties to Council assets |
It was essential that TP#7 Risk Management be successfully implemented and that risk management is embedded in the organisation. The management of corporate risks lies with the CEO and all General Managers, with departmental risk management the responsibility of the respective General Manager. The Corporate Governance Section and the Principal Risk and Compliance Specialist can provide the necessary framework, policy, procedures, advice etc., but successful risk management will only be achieved if senior management takes responsibility for managing the risk and fraud registers, implements appropriate controls and leads the organisation in developing a strong risk management culture and increasing the organisation’s risk management capabilities.
TP#7 has a financial year (FY) budget of $87,000. FY actuals and commitments to date (costs incurred with engagement of PWC) total $176,437. The project budget is monitored by the Project Lead and by the TPCT.
This report did not require community engagement.
With the implementation of an Enterprise Risk Management Framework and an increase in the capability of the organisation to manage risk efficiently and effectively, Council has positioned itself to be an exemplar Council in the management of Risk and Insurance.
1. |
ICC Corporate Risk Register ⇩ |
2. |
ICC Critical Systems and Facilities Table ⇩ |
|
|
|
CONFIDENTIAL |
3. |
|
4. |
Graham McGinniskin
Principal Risk and Compliance Specialist
I concur with the recommendations contained in this report.
Angela Harms
Governance Manager
I concur with the recommendations contained in this report.
Sonia Cooper
General Manager Corporate Services
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 12
SUBJECT: Governance and Compliance Report
AUTHOR: Integrity and Complaints Manager
DATE: 12 May 2020
Executive Summary
This is a report concerning the performance of the Corporate Governance Section (the Section) in relation to Council’s legislative compliance in the management of Complaints, Right to Information and Information Privacy functions for the period 1 January 2020 to 31 March 2020 (the Quarter).
Recommendation/s
That the report be received and the contents noted.
RELATED PARTIES
There are no related parties.
Advance Ipswich Theme
Listening, leading and financial management
Purpose of Report/Background
To inform the Committee on how the Section has performed and managed the below functions for the Quarter:
· Management of Right to Information and Information Privacy Applications
· Delivery of Transformation Project TP#06 Complaints Management Framework
To also inform the Committee on a follow-up report by the Information Commissioner on the 2017-18 Audit Report on Ipswich City Council’s management of Right to Information and Information Privacy.
1. Management of Complaints
The number of complaints being received by the Complaints Management Unit (CMU) continues to increase each quarter. This is recognised as evidence of Council’s customers trusting the established complaint channel, CMU, to have their concerns addressed.
It is anticipated that complaint numbers will increase with the return of the Elected Representatives as customers/constituents raise matters with them for referral to the CMU for management.
Reporting in the complaints space will evolve with the introduction of the use of the Insights Function of Council’s CRM database used for complaints management, Objective. Among other measures, Council will move towards including handling times in reports as a measure for the efficacy of processes utilised in the complaints management space.
|
JAN – MAR 2020 |
OCT – DEC 2019 |
||||
COMPLAINT TYPE |
CLOSED |
IN PROGRESS |
GRAND TOTAL |
CLOSED |
IN PROGRESS |
GRAND TOTAL |
Administrative Action Complaints |
0 |
2 |
2 |
4 |
0 |
4 |
Privacy Complaints |
0 |
0 |
0 |
0 |
0 |
0 |
Publication Scheme Complaints |
0 |
0 |
0 |
0 |
0 |
0 |
General Administration Action Complaints |
176 |
18 |
194 |
94 |
12 |
106 |
Ombudsman Direct Referrals Received |
0 |
0 |
0 |
0 |
0 |
0 |
General - Staff Complaint |
12 |
1 |
13 |
16 |
3 |
19 |
Ombudsman Review |
1 |
1 |
2 |
2 |
0 |
2 |
Internal Reviews on AACs |
0 |
0 |
0 |
0 |
0 |
0 |
OIC Reviews |
0 |
0 |
0 |
0 |
0 |
0 |
TOTAL NUMBER OF COMPLAINTS RECEIVED |
189 |
22 |
211 |
116 |
15 |
131 |
Statistics above show a significant increase in General Administrative Action Complaints (Stage One review of complaint) received within the quarter compared to the previous quarter. The report indicates that CMU received 194 complaints where 176 of these complaints were successfully closed in that quarter and 18 are still in progress awaiting for information provided by the business nominated persons. These complaints range from operational work issues, road maintenance, rates complaints, parking complaints and animal management to name a few major complaints categories. It is anticipated that there will be another notable increase in the next reporting period.
A slight decrease in General Staff Complaints from 19 to 13 was received. The report shows that within the 13 complaints, 12 were successfully closed, 1 is still in progress. These complaints are mainly waste truck drivers’ behaviour while servicing bins, rates related matters, compliance officers who are looking after enforcement notices, animal management officers and parking infringement officers. The CMU provide customer feedback to relevant departments and give them the opportunity to review expected behaviours of all staff as Council strives to achieve a strong customer service focus in all service delivery areas.
CMU received one request for information on a legacy complaint matter managed by Council to assist with an internal reviews on the Ombudsman’s Delegate’s decision on that matter. This request for information was intensive with a high volume of advice/information being requested to assist their investigation. The other request for information was to determine if a matter had been appropriately managed under Council’s Complaints Management Framework before accepting the matter for a review. That matter remained open in that quarter waiting on advice from the Ombudsman’s Office on how to proceed.
There was a decrease of Administrative Action Complaints from 4 to 2 complaints received in this quarter which indicates continued success in the internal review process. Having the CMU respond to the customer is proving to be successful with Council having complaint management specialists managing complaint matters and providing customer responses with a strong customer centric focus.
There were no requests for Internal Reviews, Privacy Complaints or Publication Scheme Complaints received in this quarter. This will be monitored in future reporting periods.
Quality assurance monitoring of different processing stages will be continue to be undertaken to ensure the efficacy of the Complaints Framework remains and ensure robust processes continue to be used effectively in complaints management.
2. Management of Infringement Reviews
According to the data extracted from Council’s Crystal report, PRS issued the least number of infringements in March 2020 and issued the highest in February 2020. An increase in infringements issued in February was mainly due to the changes with the parking conditions at Springfield Station. This also resulted in an increase of requests that came in for review.
Within these issued pins, the report shows an increase of request for review from 143 to 470 requests. These reviews were mainly from customers who were issued an infringement at Springfield Station.
Based on advice received, a reduction of infringements in March was due to the COVID-19 Pandemic and restrictions imposed by the Commonwealth and State Governments in relation to travelling.
Further detail on the types of infringements is set out in the addendum below.
3. Management of Right to Information and Information Privacy Applications
All RTI Applications were processed in accordance with legislative requirements, Council Policy and Procedures. The below tables provide details of the management of all RTI Applications for the reporting period.
Two RTI applications received during the Quarter were dealt with administratively. Documents released were predominantly maintenance logs of Council’s infrastructure – parks.
Moving forward work will be undertaken with the Performance Management team to develop more robust reporting on applications and data will be utilised to inform Council on improvements to its Publication Scheme.
The efficacy of application handling is evidenced by no internal or external reviews being undertaken on applications received in this quarter.
The tables below indicate the volume of RTI/IP applications received.
RTI Management |
No. |
CARRIED OVER FROM PREVIOUS QUARTER |
3 |
NEW APPLICATIONS |
9 |
CLOSED |
6 |
OPEN AND CARRIED INTO NEXT QUARTER |
6 |
IP Management |
No. |
CARRIED OVER FROM PREVIOUS QUARTER |
1 |
NEW APPLICATIONS |
3 |
CLOSED |
3 |
OPEN AND CARRIED INTO NEXT QUARTER |
1 |
4. Status of the Transformation Projects which impact the Integrity and Governance Section’s management of complaints and RTI/IP applications
4.1 TP#6 Complaints Management Framework
The Project will be formally closed in May 2020 by the Business Transformation Program Steering Committee. Any remaining deliverables will be transitioned to either business as usual activities or further strategic projects.
All but two key deliverables are 100% delivered (Key Deliverables 1 and 2 are 90% implemented)
No. |
Key Deliverable |
Progress achieved this period |
Activities planned for next period |
1 |
Complaints Management Policy & procedure |
Continued to monitor current policies to ensure efficacy. |
Legal Services Team updating policies to reflect Human Rights Act that came into effect in January 2020. Complaints Management Framework has been amended to state that all decisions made with HRA components the HRA must be considered. Discoverable evidence must be available. Considerations will be had on what this looks like. Thoughts are an assessment criteria will be developed to ensure compliance by decision makers. A new procedure is likely to be required to dovetail in with the new HRA policy being adopted. Work on this continues with Legal Services Section as BAU. |
2 |
Unreasonable Complaint Conduct (UCC) Policy and Manual |
Once adopted tool box talks to be undertaken with operational teams so full understanding is had on responsibilities of all staff for managing UCC. This will be done quarterly to ensure staff remain current on how to use the policy |
This policy and procedure still requires review by Legal Services Team to ensure it is meeting HRA. Work is being done to ensure that this policy/procedure dovetails into HRA policy/procedure. This will be completed by the end of May and will go up to Committee once finalised. |
5. Follow-up by the Information Commissioner to their 2017-18 Audit Report on Ipswich City Council’s management of Right to Information and Information Privacy
The Office of the Information Commissioner (OIC) is currently finalising a follow-up report on Council’s implementation of recommendations made in their 2017-18 audit of Council’s management of Right to Information and Information Privacy. A draft report was received by Council on 28 April 2020 and a response was provided on 12 May 2020. The draft report prepared by the OIC included an assessment that six of the recommendations are fully implemented, one partially implemented, one in progress, one with limited progress and three assessed as no action having been taken.
Council’s response set out additional action that has been taken both within the audit period, since the audit period and future planned work. The response also suggested alternate assessments that could have been made by the OIC based on the available evidence.
After considering Council’s response, the Information Commissioner has decided to re-open the follow-up audit to consider the additional evidence presented.
A further update will be provided to the ARMC through the Chair once the revised draft report is received.
Financial/RESOURCE IMPLICATIONS
There are no financial/resource implications.
RISK MANAGEMENT IMPLICATIONS
The greatest risk to the organisation is the lack of awareness by staff of their responsibilities under Council’s Complaint Management Framework, the Public Record Act, and RTI and IP Acts. All outside staff have attended Public Records Act, RTI Act and IP Act Training delivered by the TP#6 Project Lead. Internal staff have undertaken Office of the Information Commissioner RTI and IP Training and Queensland State Archives Records Challenge Training online via E-Hub. Training in Records, RTI and IP Act obligations and responsibilities is now a component of induction training and will be incorporated into annual refresher training for all staff.
Council has an obligation under the RTI and IP Acts to work towards open proactive disclosure, administrative access and information sharing (the “push model”). Considerations are being had on the Section engaging a consultant to develop a 12 month project plan using the recent organisational ‘scorecard’ developed by the Office of the Information Commission (OIC). The aim of the project plan will be to improve the organisation’s implementation of the “push model” and hopefully increase our scorecard results for the next OIC assessment. The project plan will be delivered by the Section as BAU.
Legal/Policy Basis
The following table outlines the relevant legislation and the administrative functions and services provided by the Branch:
Relevant Legislation |
Integrity and Complaints Team Administrative Functions and Services Provided |
Local Government Act 2009 and Local Government Regulation 2012 State Penalties Enforcement Act 1999 State Penalties Enforcement Regulation 2014 Withdrawal of Infringement Notice Policy (Council resolution, 27 February 2018) ALARMS risk rating (Council resolution, 26 April 2007)
|
Management complaint types:
· Administrative Action Complaints and Internal Reviews · Privacy Complaints · Publication Scheme Complaints · Ombudsman Review of Complaint Management · Ombudsman Direct Referral of Complaints · Office of Information Commission (OIC) Complaint Reviews · Operational i.e. General Department complaints referred to relevant Council Depart./Branch for resolution · Infringement Reviews |
Right to Information Act 2006 |
Management of Right to Information Applications for:
· access to information that is not administratively available · internal review of a reviewable decision |
Information Privacy Act 2006 |
Management of Information Privacy Applications:
· for personal information · to amend personal information or · to investigate complaints of privacy breaches · internal review of a reviewable decision |
COMMUNITY and OTHER CONSULTATION
This report did not require community engagement.
Conclusion
The Governance Section has performed its responsibilities and obligations in relation to maintaining Council’s compliance with the Local Government Act, Local Government Regulation, Right to Information Act and Information Privacy Act for the previous Quarter.
Dianne Nikora
Integrity and Complaints Manager
I concur with the recommendations contained in this report.
Sonia Cooper
General Manager Corporate Services
“Together, we proudly enhance the quality of life for our community”
ADDENDUM
Detail on Infringements
The below table represents the breakdown of the types of infringements being issued during Jan – Mar 2020 quarter:
TYPES OF PINS ISSUED |
JAN – 20 |
FEB – 20 |
MAR – 20 |
ANIMAL INFRINGEMENTS |
62 |
71 |
22 |
ANPR INFRINGEMENTS |
500 |
550 |
257 |
LOCAL LAWS INFRINGEMENTS |
9 |
14 |
31 |
OTHER PARKING INFRINGEMENTS |
432 |
478 |
486 |
TOTAL |
1003 |
1113 |
796 |
PINS REVIEWED |
JANUARY 2020 |
FEBRUARY 2020 |
MARCH 2020 |
WAIVED |
78 |
152 |
107 |
UPHELD |
42 |
50 |
42 |
TOTAL PINS REVIEWED |
120 |
202 |
149 |
According to the table and graph above, February recorded the most infringements that were waived and also upheld, with 152 and 50 infringements respectively.
January had the lowest of number of infringements waived.
Also, January and March scored the lowest number of infringements that were upheld with 42 infringements in both months.
The below graph depicts the statistics of the different exemption codes that were applied to all approved waived and upheld infringements:
Table of exemption codes for reference:
CODES |
JAN-20 |
FEB-20 |
MAR-20 |
1 |
18 |
8 |
4 |
2 |
11 |
21 |
17 |
3 |
0 |
3 |
0 |
4 |
6 |
5 |
2 |
5 |
0 |
1 |
1 |
6 |
1 |
1 |
0 |
6 (A) |
10 |
11 |
13 |
6 (B) |
2 |
4 |
4 |
6 ( C) |
0 |
0 |
0 |
6 (D) |
0 |
3 |
0 |
6 (E) |
0 |
0 |
2 |
6 (F) |
4 |
4 |
11 |
6 (G) |
0 |
0 |
0 |
7 |
0 |
0 |
0 |
ELECT |
1 |
2 |
1 |
UPHELD |
41 |
48 |
41 |
OTH |
0 |
0 |
0 |
OWN |
0 |
39 |
5 |
PPWTD |
0 |
0 |
2 |
PK |
0 |
0 |
0 |
SPER |
0 |
0 |
0 |
WTHNPI |
26 |
52 |
46 |
WTHNWN |
0 |
0 |
0 |
TOTAL |
120 |
202 |
149 |
Table of definitions for exemption codes for reference:
EXEMPTION CODES |
DEFINITION |
1 |
Incorrect/Incomplete/Unclear Information – A notice has been issued containing incorrect or incomplete information (eg. Incorrect vehicle registration number, incorrect name of offender or incorrect offence code) and this has caused the PIN to be invalid or the information recorded on the PIN is so unclear that it cannot be read. |
2 |
Medical Certification – A medical certificate or other acceptable supporting documentation including statements from witnesses can be produced confirming that the medical condition or a medical situation at the time of the offence caused or substantially contributed to the offence occurring and that in view of such circumstances, the PIN should be withdrawn. |
3 |
Motor Vehicle Breakdown (regulated Parking Offence) - Evidence can be produced to prove a vehicle had a mechanical problem at the time of the parking offence and that the circumstances caused the driver to park illegally. |
4 |
People with a Disability (Regulated Parking Offences) – A valid disabled persons parking permit can be produced in instances where the vehicle would not have been issued with a PIN had the permit been affixed to the vehicle. |
5 |
Charity Workers (Regulated Parking Offences) – The person to whom the PIN was issued was at the time of the alleged offence undertaking a bona-fide temporary duty on behalf of a charitable organisation and the offence did not involve traffic/pedestrian obstruction or safety related offences (withdrawal of a PIN under this criterion will only be applied to a first offence) |
6 |
Extraordinary Circumstances - In a case where an application is not addressed by the abovementioned circumstances, the decision maker may determine that the circumstances are sufficient to warrant the withdrawal of the PIN. |
6 (A) |
Extraordinary Circumstances – Instances where a decision to uphold the PIN would be contrary to Council’s Corporate Plan, Vision, Mission and Values. |
6 (B) |
Extraordinary Circumstances – Instances where the likelihood of successful prosecution is low. |
6 (D) |
Extraordinary Circumstances – The person to whom the infringement notice was issued was involved in an emergency situation at the time of the alleged offence. (Proof of the emergency would be required, eg. Doctor’s certificate, statutory declaration, oaths acted witness statements) |
6 (F) |
Extraordinary Circumstances – Ambiguous, illegible, malfunctioning or damaged signage or devices which would lead to confusion about the requirements. (For ‘malfunction of parking meters, evidence is to include a witness statement or statutory declaration that correct monies were deposited into regulated parking devices) |
7 |
Interstate Vehicle or Overseas Driver |
ELECT |
Offender has Elected to have the PIN decided in Magistrates Court |
PPWTD |
Prosecution Panel Withdrawn |
NO EXEMPTION |
PIN has been UPHELD |
OTH |
Other Circumstances |
OWN |
Owner cannot be located |
SPER |
Referred to SPER |
WTHNPI |
Withdrawn by Review Team – For new PIN to be considered by Compliance Branch |
WTHNWN |
Withdrawn by Management Team |
The following table represents the percentage rate of how many PINS were reviewed over the total number of PINS issued:
ITEMS |
JAN-20 |
FEB-20 |
MAR-20 |
TOTAL PINS REVIEWED |
120 |
1113 |
796 |
TOTAL PINS ISSUED |
1003 |
202 |
149 |
PERCENTAGE RATE |
11.96% |
18.15% |
18.72% |
Furthermore, CMU also receive CES requests jobs where work is undertaken that hasn’t resulted in a review being conducted. Below is the breakdown of the total number of these jobs that was received via our CES portal for the quarter Jan – Mar 2020:
RESOLUTION CODES |
Count of Resolution Summary |
Customer inquiry |
157 |
Upheld |
141 |
Withdrawn new PIN issued |
138 |
Medical certification |
48 |
Contrary to Council’s vision and values |
32 |
Closed as Duplicate |
27 |
Incorrect/incomplete/unclear information |
26 |
Ambiguous, illegible, damaged signage |
19 |
Likelihood of prosecution low |
13 |
Referred to SPER |
11 |
People with a disability (reg parking) |
10 |
Motor vehicle breakdown (reg parking) |
3 |
Unavoidably delayed through Council bus. |
3 |
Involved in an emergency situation |
3 |
Charity workers (reg parking) |
2 |
Extraordinary circumstances |
2 |
Customer Satisfied |
1 |
SPER - Waived |
1 |
Court election |
1 |
GRAND TOTAL |
638 |
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 13
SUBJECT: ICT Strategy Update Report
AUTHOR: Chief Information Officer
DATE: 12 May 2020
This is a report concerning an update relating to the progress of implementation of the ICT Strategy 2019-2024. The strategy was published on 2 August 2019 and was developed in collaboration with a diverse range of internal stakeholders and includes stakeholder perspectives, key trends and influences, guiding principles and a strategy map.
That the report be received and the contents noted.
Nil
Managing growth and delivering key infrastructure
There are four core strategic areas of focus that have been developed to support the ICT Strategy 2019-2024. This report provides an update against each of these focus areas:
1. ICT Governance
a. In the last six months the ICT Steering Committee (ICTSC) has been formed and the Terms of Reference defined and approved. The inception of the ICTSC was aimed at creating visibility and rigour to the process of portfolio management, information security, business engagement and stakeholder management. The goal was to transform the ICT governance approach from being inward focussed to a business led function that ensured transparency of decision-making, and pragmatic process design. This was tested with the development of the capital portfolio for 2020-2021, with a priority matrix developed for ICTSC engagement. The process applied resulted in an agreed prioritisation for the ICT capital program and a robust highly visible budget position being created and agreed for 2020-2021 with a clear path for management of contingent project priorities over the course of the year. This demonstrated the value of the approach and the early steps in the transformation program. The next companion step is to change the ICT Concept Review Board to embrace a more inclusive and agile Technical Advisory Group model that will invite business representative engagement in a more tactical way. This step will be considered by the ICTSC in the near future.
2. ICT Operating Model
a. The ICT operating model is currently being reviewed to ensure the required reform efficiencies and performance uplift is delivered. A skills and capability audit against our managed service agreements has been scoped to identify latent talent, duplication and gaps. This information will inform workforce planning and process design, automation and engagement practices.
b. Significant work is underway to address a lack of contract management and vendor engagement that resulted in sub-optimal managed service outputs, controls and processes. This work is in-flight and yielding improved outputs and a clear narrowing of the performance gap between contract service agreements and deliverables. There is a capability and capacity gap in this area that will be addressed as part of a strategic workforce plan.
3. ICT Portfolio Management
a. The strategy clearly defines the requirement to transition from an ad-hoc, disaggregated portfolio to a strategically focussed, ‘platform ecosystem’ that is sustainable.
i. In the portfolio planning for 2020-2021 a project to begin work on addressing defunct legacy systems was identified and this work is being escalated as a source of potential efficiency by making the relative compounding cost visible, reviewing the list to identify quick wins that might be achieved, and prioritising the major work for targeted business engagement to develop a remediation plan to drive an outcome to reducing this financial and information security risk.
b. Another key element of this criteria relates to information management practices and technologies to enhance the quality of data and information to unlock the value of data across all its sources.
i. In response to well aligned political drivers, a Data Governance Advisory Group (underpinned by multiple project working groups composed of subject matter experts) has been formed with the remit to drive the effective and contextual use of data internally and externally and addressing any gaps and barriers preventing such use. The core objectives are to take strategic oversight of data for the new Transparency and Integrity Hub to improve transparency and public trust, improve data quality and credibility, improve data accessibility, improve data governance and increase data use internally and externally.
ii. The Data Governance Advisory Group will also deliver a Data Governance Framework (this work is currently in-flight) to ensure a clear line of sight between mined sources and published outputs which will also be utilised to inform evidenced based decision making.
4. ICT Practice Capabilities
a. This focus area relates to a transformation from being an internal service provider motivated by cost containment to being an engaged business partner who is a valued advisor and trusted expert. Clearly this work is dependent on reforms across the other three focus areas, however steps have already been taken to create a cultural shift in this area. The initial program of work has begun, with process mapping reform to ensure processes are identified, properly scoped, and then mapped utilising common language and internal cultural markers to ensure the processes are reformed with a design thinking approach that identifies the needs and contextual experience of the customer. Recruitment has been completed to ensure an appropriately qualified and experienced officer can lead this reform, undertake a branch wide audit, and develop a process development program of work to ensure ICT Branch can achieve the cultural shift that is required to meet this transformation objective.
This report and its recommendations are consistent with the following legislative provisions:
Not Applicable
The ICT Strategy is dependent on significant workforce change to create the capability required to deliver the target improvements, and cultural change that will take time and ongoing investment in training and adaptive-skilling. Achievement of the core strategy goals is also dependent on establishing agreed business principles to increase technology and digital literacy across the organisation to empower business owners to be an engaged and robust partner. These agreed business principles will also be critical to delivering an aggregated platform (or single solution) that will drive increased performance, cost efficiency, data integration and to create a single view of the customer.
The ICT Branch budget has been informed by the ICT Strategy and its deliverables.
N/A
It can be demonstrated that significant work has been completed, is currently in-flight, and is in the planning and development phase aligned to the core focus areas of the ICT Strategy. The ICT Team is working toward a customer focused business transformation and this will contribute to supporting the goals of Ipswich City Council moving forward.
Sylvia Swalling
Chief Information Officer
I concur with the recommendations contained in this report.
Sonia Cooper
General Manager Corporate Services
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 14
SUBJECT: Nicholas Street/CBD Redevelopment Update
AUTHOR: Project Manager
DATE: 11 May 2020
This is a report concerning the progress of the Nicholas Street – Ipswich Central Project (the Project).
That the report be received and the contents noted.
Program Management Partner for the Project, Ranbury Management Group.
Retail Leasing Agent for the Project, Ranbury Property Services.
Strengthening our local economy and building prosperity
Council is redeveloping various Council-owned/leased CBD properties to deliver a civic precinct, library and administration building as well as retail and commercial assets, which, when leased will comprise retail, food/beverage, cinemas and commercial office space (refer Attachment 1). Hutchinson Builders are delivering the majority of the Project’ works (excluding the Commonwealth Hotel).
In October 2019, Council endorsed a development/divestment strategy (informed by KPMG) which recommended funding the redevelopment of the retail, commercial and entertainment assets in a staged approach and holding these assets to maximise their value prior to any divestment. The retail redevelopment is on hold and when approved will be delivered by Hutchinson Builders under a project variation (excludes Metro A).
In response to QTC advice, Council established a Project Steering Committee (PSC). A revised governance structure is proposed to ensure the Project continues to be delivered in a transparent, effective and efficient manner and includes a Retail sub-committee to govern the planning and delivery of the retail and commercial assets under an independent Chairperson with extensive retail and commercial experience. Refer Attachment 2 for PSC Minutes of 25 February 2020.
Nicholas Street mall re-opened in December 2019 and with positive community feedback received. Construction works on the major components of the redevelopment, the administration building, library, civic space and car park upgrade are all well advanced and largely on schedule. Under the current program of works, the library, the civic space and car park are scheduled to open in October 2020 and the administration building will achieve practical completion in late August 2021. Several Extensions of Time for adverse weather conditions were granted resulting in minor changes to Practical Completion dates. It is anticipated that Hutchinson Builders will finish within these revised dates. The Commonwealth Hotel is currently out to tender for its re-construction, with construction of the shell due for completion October 2020. Retail re-development works are currently on hold awaiting Council’s review of the existing strategy and associated investment.
Council’s retail leasing agent has made significant progress with eight Heads of Agreement (HOA) with prospective tenants (approximately 40% of the precinct’s retail GLA excluding Metro A). Whilst HOA are not legally binding, they are a critical step in the process to obtain executed leases. The process to finalise an agreement for lease/lease with the key anchor tenant in the Venue is progressing.
The full impact of COVID-19 on the redevelopment remains unclear. Hutchinson Builders have largely continued their construction activities unabated following some modifications to their work practices. There were initially delays forecast for the receipt of some key components required for the construction of the new administration building however associated delivery risks are now minimal. The impact of the virus on the retail leasing process is more uncertain. Early indications from some potential lessees is that a strong interest in the Ipswich CBD opportunity remains and that once the pandemic passes, business conditions will return to normal over time.
This report and its recommendations are consistent with the following legislative provisions:
Local Government Act 2009
Local Government Regulation 2012
The Nicholas Street - Ipswich Central redevelopment project carries significant financial and reputational risk to Council. In addition, Council faces risks in the development, leasing and future ongoing operation of the retail and commercial assets it controls. Council’s ability to effectively activate and create a destination will be a critical factor in the precinct’s success from both a community and commercial perspective. The proposed project governance structure will strengthen existing control measures in the management of these risks.
Council has adopted budgets totalling approximately $245M that include funding for:
• Administration building, civic space, library, car park including demolition works;
• Commonwealth Hotel and Nicholas Street/Union Place upgrades; and
• Retail incentives and redevelopment (excludes Metro A refurbishment).
Council’s project team have implemented strict controls over project and contingency expenditure (refer Attachment 3). Should Council decide to invest in Metro A’s redevelopment, additional funding of approximately $11M will be required. Refurbishment costs of the towers at 2 Bell Street and 143 Brisbane Street to allow for commercial leasing are yet to be quantified. An inaugural precinct operational budget is currently under development.
Not applicable
The delivery of the redevelopment is progressing largely to plan with only minor modifications to Practical Completion dates due to adverse weather conditions. Delivery of the retail development will be dependent on the timing of any Council decision to progress the investment in the retail and entertainment assets. The expanded governance structure will act as an effective control measure for the Project.
1. |
CBD Redevelopment Key Assets ⇩ |
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CONFIDENTIAL |
2. |
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3. |
Nicholas St Ipswich Central April 2020 Executive Report No 13 |
Greg Thomas
Project Manager
I concur with the recommendations contained in this report.
Sean Madigan
General Manager - Coordination and Performance
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 15
SUBJECT: ICT Platform Project - Update
AUTHOR: Program Manager (Business Improvement)
DATE: 11 May 2020
This is a report concerning the ICT Platform Project.
That the report be received and the contents noted.
There was no declaration of conflicts of interest.
Listening, leading and financial management
As part of the Business Transformation Program, Council’s ICT Strategy was delivered by Transformation Project #17. Multiple themes were identified in the Strategy, including the need to address theme 2 – Business Platform. This theme focused on stabilising and consolidating key business applications and enabling potential investment in a single IT platform.
The resultant Platform Project is proposed to be split across 6 stages, with activities under Stage 1 currently underway. The proposed stages are as follows:
STAGE |
KEY DECISION POINT |
Stage 1 Discovery |
· Solution option recommendations supported by due diligence, discovery results and analysis. |
Stage 2 Go To Market |
· Evaluation of Market Responses and Recommendations Report delivered and approved |
Stage 3 Solution Selection |
· Approval of robust Business Case and Solution Recommendation |
Stage 4 Procure and Plan to Implement |
· Execution of contract with vendors/partners including agreed project plan and scope of work |
Stage 5 Implementation |
· In accordance with agreed Project Management and Governance frameworks. Implementation is likely to span over a number of years and will be staged with decision points within each stage to determine organisational readiness for ‘go live’. |
Stage 6 Close |
· Approval of Project Completion Report and Lessons Learned, etc. |
The Stage 1 activities undertaken to date have identified 3 potential options which are recommended to be detailed and compared as part of a robust business case. A preliminary findings paper and accompanying summary presentation has been developed and will be presented to the ICT Steering Committee for approval to progress with development of the business case based on the identified options.
The project approach has been identified to ensure the process for arriving at a system solution is exemplary in terms of the research, analysis, decision points, stakeholder engagement and input from a whole of Council perspective, while underpinning this work with good governance, project and change management processes. The significance of this project should not be underestimated in terms of its financial and resourcing impacts and the potential for disruption to, and dysfunction of, council operations and services if the project is rushed and not carefully assessed and considered.
By undertaking the project under the approach proposed, Council has the opportunity to engage with and inform other local government authorities on the findings from the resultant investigation into platform options and considerations. Additionally, if this project is executed diligently then Council can provide a template for other councils to follow to inform sound decision making, supported by good governance structures and detailed investigative research and analysis processes.
Part of the project approach has considered the Queensland Audit Office’s report to Parliament on the Effectiveness of the State Penalties Enforcement Registry ICT Reform (Report and Best Practice Guide). The QAO Report highlights that a project’s success starts with a governance approach which considers key risks and mitigates these with processes and personnel that are able to deal with and address any challenges that may arise. A good governance structure ensures skills, expertise and knowledge are aligned with the key decision points that will help steer an organisation to the right answer. The project plan places far more focus on getting the governance structure and decision points correct before progressing to the next stage of the plan.
The project will also be taking a proactive approach to engage both QAO and Queensland Treasury Corporation (QTC) throughout the life of the project to ensure the project is executed in a transparent and efficient manner.
This report and its recommendations are consistent with the following legislative provisions:
Local Government Act 2009
As this report is for information only, there are no risks associated with the recommendation. However, high level initial risks have been identified in accordance with the ICC Project Risk Management Manual and are attached to this report.
As this report is for information only, there are no financial/resource implications of the recommendation.
For Stage 1, consultation has been undertaken with:
· the CEO (Project Sponsor)
· General Manager, Corporate Services
· General Manager, Coordination and Performance
· ICT Steering Committee members
· members of the ICT Management Team, and
· the Chief Audit Executive.
In the development of the preliminary findings paper, a number of local government entities were contacted to provide their feedback and learnings from similar projects.
It is intended that a full stakeholder impact assessment will be undertaken as part of the change management activities for the project.
The Platform project is currently progressing through Stage 1 with a preliminary findings paper and accompanying summary presentation developed. These documents will be presented at ICT Steering Committee for approval to progress with the development of a business case.
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CONFIDENTIAL |
1. |
Anna Payne
Program Manager (Business Improvement)
I concur with the recommendations contained in this report.
Joshua Edwards
Acting Manager Performance
I concur with the recommendations contained in this report.
Sean Madigan
General Manager - Coordination and Performance
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 16
SUBJECT: Corporate Program Management Office
AUTHOR: Acting Manager Performance
DATE: 12 May 2020
This is a report concerning the process, systems and controls currently in place to manage the delivery of the Business Transformation Program and other key strategic projects.
That the report be received and the contents noted.
The Business Transformation Program (BTP) was established in late 2018 as a blueprint to address priority issues and implement positive, ethical change. The goal is to establish our Council as exemplar from which other councils yearn to learn and strive to emulate. This program of transformation is about being a leading council again. The BTP is now a component of the Program Management Office (PMO) and exists within a program of work that includes strategic projects for Council. This report provides an update on the BTP and strategic projects within the PMO.
The contents of the report as follows:
1. Business Transformation Program
1.1. Program health check
1.2. Update on previously raised program issues or significant risks
1.3. New program issues or significant risks
1.4. Post implementation reviews
2. Strategic Projects
2.1. Program health check
2.2. New projects and summary controls
2.3. New issues or significant risks
1. |
Audit and Risk Report ⇩ |
2. |
BTP Post Implementation Review Register ⇩ |
Joshua Edwards
Acting Manager Performance
I concur with the recommendations contained in this report.
Sean Madigan
General Manager - Coordination and Performance
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 17
SUBJECT: People & Culture Update
AUTHOR: Manager, People and Culture
DATE: 12 May 2020
This is a report to the Audit and Risk Management Committee on progress in the implementation of the People and Culture Strategic Plan 2019-2021.
That the progress in the implementation of the People and Culture Strategic Plan 2019-2021 be noted by the Audit and Risk Management Committee.
People and Culture Branch
Listening, leading and financial management
The strategic plan was developed through Transformation Project 2 and the Manager, People & Culture at the time.
The new Manager, People & Culture (P & C) commenced in the role on 3 February 2020 and is responsible for the implementation of the P&C Strategic Plan.
The priorities within the plan have been detailed and dates for delivery against the plan have been reviewed and updated to be able to be achieved.
At the last Committee meeting, an update on the implementation of the P & C Strategic Plan was requested and committed to being provided at this meeting.
The attached presentation, is the three (3) month review of the implementation activities against the P&C Strategic Plan. The transformation project has closed, however, the implementation of the Strategic Plan needs to continue and will do so, as a strategic corporate project.
Updates will be provided to future ARMC meetings.
This report and its recommendations are consistent with the following legislative provisions:
Not Applicable
The key risks to delivering on the Strategic Plan will be the ability of the business to absorb and apply the changes and improvements as they are made within the branch. Changes to any frameworks, processes and directives will require changes to the way the business acts. While the business is also going through significant change, it will be important for the P&C branch to ensure there is effective communication and engagement for new and improved initiatives. This will ensure there is an overall improvement in the ICC culture and improved success for employees at ICC to work within a constructive culture which was the key focus for the Strategic Plan.
The People & Culture Branch Budget was agreed and approved and has been built into the 2020-2021 Council Budget.
The strategic plan and implementation actions have been shared with the Executive Leadership Team. Given the significant challenges to transition to remote operations (including running payroll remotely and adjusting from a face to face to online weekly induction for new employees), the ELT were happy with the progress and acknowledged the further work required by the team. To support the ongoing function of P&C, updates will be provided to ELT on a monthly basis to ensure we remain focussed on key and emerging issues while building a robust people and culture framework.
The People & Culture team have come together over the past 3 months with a significant number of new team members. They have adapted well to remote working during the COVID-19 Pandemic requirements and are ready to transition back to the workplace to continue to build on the foundations they have started. There is a significant amount of foundational work to be completed, therefore the energy and enthusiasm of the team will need to be maintained to continuously improve over the next twelve to eighteen months.
1. |
People and Culture Update Presentation May 2020 ⇩ |
Paula Perry
Manager, People and Culture
I concur with the recommendations contained in this report.
Sonia Cooper
General Manager Corporate Services
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 18
SUBJECT: Impact of New Accounting Standards - FY 2020
AUTHOR: Principal Financial Accountant
DATE: 27 April 2020
This is a report concerning a request from the Queensland Audit Office (QAO) requiring Ipswich City Council (ICC) to provide a position paper regarding the impact of recently issued or amended accounting standards for Council and its controlled entities (Ipswich City Properties Pty Ltd (in Members Voluntary Liquidation), Ipswich City Enterprises Pty Ltd, Ipswich City Enterprises Investments Pty Ltd, Ipswich Arts Foundation, Ipswich Arts Foundation Trust and Cherish the Environment Foundation Ltd). In accordance with the key milestones agreed in the External Audit Plan, Council is required to provide the position paper to QAO by 31 May 2020.
That the report of the Principal Financial Accountant regarding the impact of the recently released or amended Accounting Standards for Ipswich City Council dated 27 April 2020 be received and the contents noted.
The impact of new accounting standards reported in this paper includes financial information relating to Council’s controlled entities (Ipswich City Properties Pty Ltd (in Members Voluntary Liquidation), Ipswich City Enterprises Pty Ltd, Ipswich City Enterprises Investments Pty Ltd, Ipswich Arts Foundation, Ipswich Arts Foundation Trust and Cherish the Environment Foundation Ltd).
Listening, leading and financial management
The Australian Accounting Standards Board (AASB) issued new accounting standards which Council adopted on 1 July 2019, this report details the material impact of:
· AASB 15 Revenue from Contracts with Customers
· AASB 1058 Income of Not-for-Profit Entities
· AASB 16 Leases.
Council assessed the new Accounting standard AASB 1059 Service Concession Arrangements: Grantors and determined that it is not expected to have any impact. While AASB 2018-7 Amendments to Australian Accounting Standards – Definition of Material, will require Council to consider materiality of information disclosed in the financial statements.
AASB 15 Revenue from Contracts with Customers
AASB 1058 Income of Not-for-Profit Entities
Under AASB 15 and AASB 1058 the timing of income recognition will depend on whether a grant is enforceable and gives rise to a sufficiently specific performance obligation, liability or contribution by owners. Hence, revenue is recognised initially as a liability and once the obligation is satisfied the liability is derecognised and revenue recognised. (Refer to paragraph 15 and 16 of AASB 15 and paragraph 16 of AASB 1058.) Revenue is recognised either “at a point in time” or “over time”. Also, AASB 1058 requires the fair value measurement of assets and transactions for which consideration is significantly below fair value (including peppercorn leases). (Refer to paragraph 7 of AASB 1058.)
In adopting AASB 15 and AASB 1058 the modified retrospective approach has been applied whereby an adjustment is processed as at 1 July 2019 and comparatives have not been adjusted. The impact of AASB 15 and AASB 1058 for Council and the controlled entities revenue has been assessed. Refer to Attachment 1 for details.
Grants
In accordance with the Queensland Audit Office’s recommendations, in assessing the application of AASB15 and AASB1058 for grants, the materiality threshold is $1 million for Council and no threshold for the controlled entities.
Assessment: Grants for financial assets
Council receives grants for financial assets, but no financial grant agreement includes sufficiently specific performance obligations. If there is a performance obligation to deliver goods or services, only targets are stated in the grant agreement. Targets are not considered a performance obligation as these are goals for Council to achieve. Also, the requirement of progress reports or acquittal reports do not constitute a sufficiently specific performance obligation. No grants for financial assets span over the end of financial year. Grants of financial assets will be recognised as revenue upon receipt, hence “at a point in time”. Grants for financial assets of material value include Financial Assistance Grants, Home Assist Secure and Commonwealth Home Support Program. The controlled entities do not receive grants.
Assessment: Grants for capital assets
Council’s receives grants for capital assets which have an enforceable grant agreement and contain sufficiently specific performance obligations to deliver goods or services. These are initially recognised as a liability and then revenue when the performance obligation (percentage of completion) is satisfied. Most grants have an initial upfront payment then a requirement for milestone claims when a percentage of works have been completed and revenue is recognised upon submission of the claim. Some capital grants do span over the end of financial year. At the end of financial year Council will assess capital grants to identify contract assets (construction work where an invoicing milestone has not yet been met) and contract liabilities (grant funding received prior to performance obligations being satisfied). Grants for capital assets with sufficiently specific performance agreements will be recognised “over time”.
Grants for capital assets of material value include:
· Roads to Recovery (Brisbane Street, West Ipswich) - $2,327,860
· Local Government Grants and Subsidies Program (Rosewood Library Construction) - $2,689,696
· Cycle Network Local Government Grants Program (Brisbane Valley Rail Trail Connector - Brassall Bikeway Stage 7) – $1,050,000
· Blackspot (Cobalt Street and Johnson Road) - $1,270,000
Council receives quarterly payments for Roads to Recovery (R2R) grants and in turn provides quarterly expenditure reporting. For R2R there are no sufficiently specific performance obligations as Council controls the work schedule and quarterly reporting does not constitute a performance obligation.
Capital grants for Rosewood Library Construction, Brisbane Valley Rail Trail Connector – Brassall Bikeway Stage 7 and Blackspot (Cobalt Street And Johnson Road) all include sufficiently specific performance obligations in the grant agreement which is measurable based on the percentage of completion (costs incurred) for the project and span over the end of financial year. In 2018-2019, Council had recognised grant revenue of $489,507 which had sufficiently specific performance obligations that had not been satisfied and grant revenue of $14,789 which Council was entitled to for unbilled works. In applying the modified retrospective approach as at the 1 July 2019, adjustments will be made as follows:
DR Work in Progress - Unbilled Revenue (Contract Assets) $ 14,789
DR Accumulated Surplus $474,718
CR Work in Progress - Unearned Revenue (Contract Liability) $489,507
This adjustment will reverse during 2019-2020 when obligations are completed.
As at the 30 June 2020, estimated adjustments for capital grants are as follows:
DR Work in Progress - Unbilled Revenue (Contract Assets) $262,500
DR Capital Grant Revenue $298,500
CR Work in Progress - Unearned Revenue (Contract Liability) $561,000
The impact of AASB 15 and AASB 1058 for Council’s capital grant revenue has been assessed. Refer to Attachment 2 for details.
Additional details will be disclosed in the notes to the financial statements which will include capital grant revenue being reported as either “recognised at a point in time” or “recognised over time”.
Contributions
Developer contributions are paid at any point prior to the survey plan being released or before they commence the use on a material change of use application. The developer will not be entitled to the survey plan until contributions are paid in full and all conditions are met. Developer contributions paid after use has commenced is recognised as revenue immediately. While for donated assets (eg. land, infrastructure assets and artworks) when these become “on maintenance” an asset is recognised at fair value and revenue recognised immediately. Ipswich Arts Foundation and Ipswich Arts Foundation Trust receive contributions from Council and the Friends of Ipswich Art Gallery; these contributions do not have sufficiently specific performance obligations so contributions are recognised upon receipt. Cherish the Environment Foundation receives contributions relating to the enviroplan of which these contributions do not have sufficiently specific performance obligations. Both contributions and donated assets revenue are recognised as revenue “at a point in time”.
Rates Paid in Advance
From the 1 July 2019 rates paid in advance has been recognised as a financial liability, then when rates generation occurs (obligation is fulfilled) the financial liability is drawn down and rates revenue is recognised. In applying the modified retrospective approach an adjustment has been processed to recognise the prepaid portion of rates as at the 1 July 2019. Modified retrospective adjustment as at the 1 July 2019 has been posted as follows:
DR Equity Account $4,102,563
CR Unearned rates paid in advance (Financial Liability) $4,102,563
Fees and Charges
Town planning fees are recognised as revenue upon receipt. Animal, infringement and other licence fees revenue is recognised upon receipt as there is no enforceable contract with the customer, no sufficiently specific performance obligations attached and these transactions are large volumes of low dollar value over a short-term period. These fees are recognised “at a point in time”. In Council’s assessment of license fees due to licences being for a 12 month period and of low value, Council has applied the exemption for short-term licences and licences issued for a low transaction price in accordance with paragraph 4 of AASB 2018-4 Amendments to Australian Accounting Standards – Australian Implementation Guidance for Not-for Profit Public Sector Licensors which primarily amends AASB 15 to add requirements and authoritative implementation guidance
Volunteer Services
AASB 1058 requires that an inflow of resources in the form of volunteer services is recognised as an asset or expense if the services can be measured reliably and would have been purchased if they were not donated. Council has 571 volunteers who provide services and Council considers these services as community or value add services for Ipswich. Council departments would not purchase these services except for some services performed at Queens Park. The value of these services performed at Queens Park, if purchased is approximately $72,131 annually, however due to movement in numbers of volunteers at Queens Park throughout the year the estimate is not reliable so Council will not recognise the estimate. Refer to Attachment 3 for details. In response to Paragraph 19 of AASB 1058 Council has elected not to recognise volunteer services. Council will disclose in the “Notes to the Financial Statements” that volunteer services are not recognised as the majority of services would not have been purchased if they had not been donated and the services cannot be reliably measured. Due to COVID-19 Council currently has no volunteers.
AASB 16 Leases
The intention of AASB 16 Leases is to put ‘off-balance sheet’ operating leases ‘on-balance sheet’. As a result, a right-of-use asset and a lease liability is recognised for the discounted cash flow of lease payments for the lease term. (Refer to paragraph 22 to 28 of AASB 16 Leases.) Right-of-use assets are depreciated over the period of the lease using the straight-line method.
Council has 10 property leases agreements, of which 8 leases require the recognition of right of use assets (ROU) and lease liabilities, while exemption applies to 2 leases due to low-value (under $10,000) or short-term lease (12 months or less). Council has no embedded leases where there is an explicit or implicit asset in the contract and the customer controls use of the asset. Council does not lease any vehicles, waste trucks, plant or equipment. The controlled entities have no leased properties from third parties.
In adopting AASB 16 Leases the modified retrospective approach will be applied whereby adjustments will be processed as at 1 July 2019 and comparatives will not been adjusted. Applying the modified retrospective approach as at the 1 July 2019 a right of use asset of $6,996,397 and lease liability of $5,287,649 will be recognised. As at the 30 June 2020, the balance of right of use assets is estimated to be $6,274,741 (ROU $6,996,397 less amortisation $721,656) and lease liability of $4,647,242 (lease liability $5,287,649 less principal payments $640,407). Council has not included the extension options for 2 leases as these have been assessed as not reasonably certain, however the leases note will disclose the $252,159 in potential future lease payments if these extension options had of been exercised. Refer to Attachment 4 for details.
Council uses an Excel based leases model and will post end of financial year (EOFY) journals in Period 13 of 2020 FY to account for the 2019-2020 transactions. The ROU arising under AASB 16 will be disclosed in a separate note to the Property, Plant and Equipment note in the financial statements.
Peppercorn Leases
AASB 16 and AASB 1058 requires lease payments of nominal value and that do not reflect the market value of lease payments for the property being leased, be brought to fair value with the difference between the right-of-use asset (measured at fair value) and the lease liability (measured at present value) recognised as revenue. The AASB has provided temporary relief for all not-for-profit entities in relation to peppercorns until further guidance and thresholds for the valuation of right of use assets have been finalised. Council has 3 peppercorn leases which are leased from the Department of Natural Resources and Mines. Council will continue to recognise these peppercorn leases at nominal value. It is expected that this will have a material impact for Council when implemented in the future. Refer to Attachment 4 for details.
AASB 1059 Service Concession Arrangements: Grantors
AASB 1059 has no impact as Council does not have any service concession arrangements with a private sector (operator) for the delivery of public services, hence Council will not control any service concession assets.
AASB 2018-7 Amendments to Australian Accounting Standards – Definition of Material
Effective from the 1 January 2020. Council will assess the materiality of individual or combination of items, transactions and or other events in accordance with the revised definition of “material” and guidance provided in the examples of AASB2018-7 in preparing the financial statements. The revised definition of material is “Information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements, which provide financial information about a specific reporting entity”. AASB2018-7 provides examples of circumstances that may result in material information being obscured:
· information regarding a material item, transaction or other event is disclosed in the financial statements but the language used is vague or unclear;
· information regarding a material item, transaction or other event is scattered throughout the financial statements;
· dissimilar items, transactions or other events are inappropriately aggregated;
· similar items, transactions or other events are inappropriately disaggregated; and
· the ability to understand the financial statements is reduced as a result of material information being hidden by immaterial information to the extent that a primary user is unable to determine what information is material.
This report and its recommendations are consistent with the following legislative provisions:
Local Government Act 2009
Local Government Regulation 2012
Australian Accounting Standards
The risk in not approving the recommendation would result in Council not complying with Australian Accounting Standards. As a result, Council’s financial statements would receive a qualified audit opinion.
For financial year 2020 and future financial years, the impact of new accounting standards will result in deferral of revenue recognition for some capital grant revenue (AASB 15 and AASB 1058) and the recognition of right of use assets and lease liabilities (AASB 16).
The Treasury team has been consulted in regards to the assessment of revenue and leases for the controlled entities.
The impact of AASB 15 Revenue from Contracts with Customers and AASB 1058 Income of Not-for Profit Entities will result in some grant revenue for non-financial assets (capital assets) being deferred until sufficiently specific performance obligations are complete. A modified retrospective adjustment of $474,718 will be applied against accumulated surplus for grant revenue that should have been recognised as unearned as at the 30 June 2019.
Rates paid in advance is recognised initially as a liability and then revenue when the rating period occurs. A modified retrospective adjustment of $4,102,563 has been applied against accumulated surplus for rates revenue that should have been recognised as unearned as at the 30 June 2019.
The impact of AASB 16 Leases is to put ‘off-balance sheet’ operating leases ‘on-balance sheet’ will result in the recognition of a right-of-use asset and lease liability. The modified retrospective approach will be applied to recognise a right-of-use asset of $6,996,397 and lease liability of $5,287,649. Recognition of revenue relating to peppercorn leases has been delayed until fair value thresholds are established, when this does occur it is expected this will have a material impact for Council.
The impact of AASB 2018-7 Amendments to Australian Accounting Standards – Definition of Material will be applied in considering the materiality aspect of disclosing information in the financial statements.
1. |
Revenue Analysis - AASB 15 and AASB 1058 - Council and Controlled Entities ⇩ |
2. |
Capital Grants Analysis - AASB 15 and AASB 1058 ⇩ |
3. |
Volunteer Services Analysis - AASB 1058 ⇩ |
4. |
Leases Analysis - AASB 16 ⇩ |
Barbara Watson
Principal Financial Accountant
I concur with the recommendations contained in this report.
Jeffrey Keech
Manager, Finance
I concur with the recommendations contained in this report.
Sonia Cooper
General Manager Corporate Services
“Together, we proudly enhance the quality of life for our community”
Audit and Risk Management Committee Meeting Agenda |
20 May 2020 |
ITEM: 19
SUBJECT: 2019-2020 Asset Valuation - Update
AUTHOR: Principal Financial Accountant
DATE: 11 May 2020
Executive Summary
This is a report concerning the progress of the 2019-2020 asset valuation for land, buildings and infrastructure assets.
Recommendation/s
A. That the report of the Principal Financial Accountant regarding the progress of the 2019-2020 asset valuation for land, buildings and infrastructure assets be received and the contents noted.
B. That through the Audit and Risk Management Committee Chair, the final valuation report for 2019-2020 (to be finalised by mid-June 2020) be circulated to Committee Members for discussion and endorsement and if required a special Audit and Risk Management Committee meeting be convened to approve and endorse the report prior to 30 June 2020.
RELATED PARTIES
There are no related parties.
Advance Ipswich Theme
Listening, leading and financial management
Purpose of Report/Background
In accordance with Council’s Asset Accounting Policy, Asset Revaluation Procedure and the Australian Accounting Standards, Council is required to conduct an annual revaluation of its non-current asset classes. Council’s current revaluation procedure Asset Revaluation FCS-005 provides that Council will revalue all its non-current assets on a five year rolling basis provided that these assets do not experience significant and volatile change in fair value.
A report was presented to the Audit and Risk Management Committee in November 2019 outlining the procurement approach Council was taking to appoint a valuer for the next 5 years including the project specifications, scope of works, deliverable etc. Following the RFQ process, utilising the existing Local Buy Contracts, the contract was awarded Cardno (QLD) Pty Ltd (Cardno) as they offered the best value for money and expertise to deliver the required asset revaluation for land, building and infrastructure assets to Ipswich City Council.
Revaluation Schedule
Formal revaluations occurring in the 2019-2020 year are per the schedule below:
Year |
Formal Valuation |
Desktop Valuation |
Final Report Due Date |
2020 |
(a) Land |
(d) and (e) |
27 April 2020 |
2020 |
(b) Buildings and Structures |
(d) and (e) |
27 April 2020 |
2020 |
(c) Detention Basins * |
(d) and (e) |
27 April 2020 |
2021 |
(d) Roads, Bridges and Footpaths |
(a), (b), (e) |
27 April 2021 |
2022 |
(e) Flooding and Drainage |
(a), (b), (d) |
27 April 2022 |
2023 |
Artworks ** |
(a), (b), (c), (d), (e) |
27 April 2023 |
Actions to date
· In February 2020 Council met with Cardno and their subcontractor (Pickles Valuations Pty Ltd) as part of the commencement of the process to discuss the valuation process and to confirm the scope and deliverables. Council provided both the fixed asset register and physical asset register to Cardno along with various drawings and Council’s condition assessment for road seals.
· In accordance with the project schedule, during March and April 2020 Cardno provided indexation files for infrastructure assets (roads, buildings and footpaths and drainage) to the Asset Accounting and Asset Management teams who reviewed, compared and tested the unit rates, condition assessments and useful lives applied by Cardno. Indexation movements, after review and agreement by Council are immaterial. Further details will be provided in the final revaluation report that will be submitted to the Audit and Risk Committee in June (discussed later).
· In March 2020 Ross Searle and Associates performed the indexation of artwork assets. The drafted indexation file was reviewed and tested resulting in clarification of some artworks values by Ross Searle. Then in April 2020 Ross Searle provided the revised indexation report in which Asset Accounting reviewed and subsequently accepted. Artwork assets value increased by 1.2% for artworks as the movement is immaterial (less than 5%) Council will not be applying the indexation.
· Pickles Valuations Pty Ltd (subcontracted property valuer to Cardno) performed physical inspections of over 500 buildings during March and April as part of determining the condition assessment to inform the revaluations. Valuation files were provided during April 2020 which the Asset Accounting and Asset Management teams have reviewed, compared, tested the unit rates, condition assessments, useful lives and resolved any questions they had. The revised valuation file for buildings was provided early May 2019 in which Asset Accounting and Asset Management reviewed and subsequently accepted. Building assets increased in value by 12.34% due to being a comprehensive revaluation the increase will be applied to building assets.
· Currently Council is still waiting for the revised valuation file for other structures, however Cardno has advised that Council should receive the valuation file by 12 May 2020.
· In April 2020 Cardno provided the valuation report for the land valuation the which Asset Accounting team reviewed, compared and tested the price per square meter with recent sales and land valuation movement data released from the Queensland State Government. In consultation with Cardno’s subcontracted property valuer, any questions and issued have been resolved resulting in a revised valuation file which Asset Accounting reviewed and subsequently accepted for land. Land assets value increased by 12.58% due to being a comprehensive revaluation the increase will be applied to land assets.
The valuation schedule has been delayed by two weeks due to COVID-19 as this had some impact on communication within Cardno’s team, inspection of assets and further time to resolve outstanding queries.
Council is however on track to provide the asset valuation details to QAO by 15 June 2020 in accordance with the agreed external audit plan.
Outstanding Items
Council is currently waiting for the revised valuation file for other structures and the draft valuation report. Cardno’s intention is to provide both outstanding items by 12 May 2020.
2019 -2020 VALUATION REPORT AND ACCOUNTING ENTRIES
Once the final valuation report is received and reviewed by the Asset Accounting, Asset Management Teams and Management, a 2019-2020 valuation report will be prepared to the Audit and Risk Committee outlining fully the revaluation process (outlined above), the governance controls over the processes through the asset accounting and asset management team, and the final revaluation accounting movements recommended to Council to be approved and processed.
The timing of this report has not aligned with the Audit and Risk Committee meeting dates this financial year. Accordingly it is proposed that a copy of the report be circulated to Audit and Risk Committee Members for discussion and endorsement through the appropriate governance and approval process.
Legal/Policy Basis
This report and its recommendations are consistent with the following legislative provisions:
Local Government Act 2009
Local Government Regulation 2012
Australian Accounting Standards
RISK MANAGEMENT IMPLICATIONS
The valuation of assets in accordance with the Accounting Standards, including AASB 116 Property, Plant and Equipment & AAS13 Fair Value, is a significant risk as part of the preparation of the Annual Financial Statements and compliance with Council’s Asset Accounting policy. Council processes, the management and involvement of appropriate qualified and skilled Council staff and support from an experienced qualified valuation expert, are critical to mitigating this risk.
Financial/RESOURCE IMPLICATIONS
The costs associated with undertaking the valuations are budgeted within the Corporate Services Department operational budget.
COMMUNITY and OTHER CONSULTATION
The asset management and asset accounting teams have worked closely together through the revaluation process including the provision of asset data to be revalued. The asset management team have also been consulted with and are part of the team that review the valuation and indexation files received.
Conclusion
The revaluation processes undertaken to date are outlined in the report. Following completion of the revaluations and review and agreement by Management, a report will be prepared for circulation and endorsement by the Audit and Risk Committee Members through the appropriate governance and approval process.
Barbara Watson
Principal Financial Accountant
I concur with the recommendations contained in this report.
Jeffrey Keech
Manager, Finance
I concur with the recommendations contained in this report.
Sonia Cooper
General Manager Corporate Services
“Together, we proudly enhance the quality of life for our community”