Risk and Assurance Committee Agenda

NOTICE IS GIVEN that the next meeting of the Risk and Assurance Committee will be held in Council Chambers, Regional House, 1 Elizabeth Street, Tauranga on:

Wednesday 8 March 2023 COMMENCING AT 9.30 am

This meeting will be livestreamed and recorded.

The Public section of this meeting will be livestreamed and recorded and uploaded to Bay of Plenty Regional Council’s website.  Further details on this can be found after the Terms of Reference within the Agenda. Bay of Plenty Regional Council - YouTube

 

Fiona McTavish

Chief Executive, Bay of Plenty Regional Council Toi Moana

27 February 2023

 


 

Risk and Assurance Committee

Membership

Chairperson

Cr Stuart Crosby

Deputy Chairperson (Independent)

Bruce Robertson

Members

Cr Ron Scott

Cr Andrew von Dadelszen

Cr Te Taru White

Cr Kevin Winters

Ex Officio

Chairman Doug Leeder

Quorum

Three members, consisting of half the number of members

Meeting frequency

Quarterly

Purpose

Monitor the effectiveness of Council’s funding and financial policies and frameworks to ensure the Council is managing its finances in an appropriate manner.

Monitor the effectiveness of Council's performance monitoring framework.

Ensure that Council is delivering on agreed outcomes.

Role

·                Monitor the effectiveness of Council’s funding and financial policies and Council’s performance monitoring framework (financial and non-financial).

·                Review Council’s draft Annual Report prior to Council’s adoption.

·                Receive and review external audit letters and management reports.

·                Approve and review the internal audit plan and review the annual programme report.

·                Approve, review and monitor Council’s risk framework and policy.

·                Review the risk register.

·                Monitor Council’s legislative compliance and receive reporting on non-compliance matters as part of risk management reporting.

Power to Act

To make all decisions necessary to fulfil the role and scope of the committee subject to the limitations imposed.

Power to Recommend

To Council and/or any standing committee as it deems appropriate.

The Risk and Assurance Committee is not delegated authority to:

·                Develop, review or approve strategic policy and strategy.

·                Develop, review or approve Council’s Financial Strategy, funding and financial policies and non-financial operational policies and plans.

The Risk and Assurance Committee reports directly to the Regional Council.


 

Recording of Meetings

Please note the Public section of this meeting is being recorded and streamed live on Bay of Plenty Regional Council’s website in accordance with Council's Live Streaming and Recording of Meetings Protocols which can be viewed on Council’s website. The recording will be archived and made publicly available on Council's website within two working days after the meeting on www.boprc.govt.nz for a period of three years (or as otherwise agreed to by Council).

All care is taken to maintain your privacy; however, as a visitor in the public gallery or as a participant at the meeting, your presence may be recorded. By remaining in the public gallery, it is understood your consent is given if your image is inadvertently broadcast.

Opinions expressed or statements made by individual persons during a meeting are not the opinions or statements of the Bay of Plenty Regional Council. Council accepts no liability for any opinions or statements made during a meeting.

 


Bay of Plenty Regional Council - Toi Moana

Governance Commitment

mō te taiao, mō ngā tāngata - our environment and our people go hand-in-hand.

 

 

We provide excellent governance when, individually and collectively, we:

·        Trust and respect each other

·        Stay strategic and focused

·        Are courageous and challenge the status quo in all we do

·        Listen to our stakeholders and value their input

·        Listen to each other to understand various perspectives

·        Act as a team who can challenge, change and add value

·        Continually evaluate what we do

 

 

TREAD LIGHTLY, THINK DEEPLY,
ACT WISELY, SPEAK KINDLY, JOURNEY TOGETHER.


Risk and Assurance Committee                                                                                        8 March 2023

Recommendations in reports are not to be construed as Council policy until adopted by Council.

Agenda

1.       Apologies

2.       Public Forum

3.       Items not on the Agenda

4.       Order of Business

5.       Declaration of Conflicts of Interest

6.       Public Excluded Business to be Transferred into the Open

7.       Reports

Information Only

7.1      Chairperson's Report                                                                               1

Attachment 1 - Risk and Assurance Work Programme for 2023                                   1

Attachment 2 - Risk and Assurance Completed Work Programme for March to September 2022                                                                                                                    1

7.2      Audit New Zealand Report on the Audit of the Bay of Plenty Regional Council for the Year Ended 30 June 2022                                              1

Attachment 1 - Audit New Zealand Report on the Audit of BOPRC for year ended 30 June 2022                                                                                                                               1

7.3      Efficiency and Effectiveness Gains and Progress on Benchmarking  1

7.4      Internal Audit Status Update                                                                  1

8.       Public Excluded Section

Resolution to exclude the public

Excludes the public from the following parts of the proceedings of this meeting as set out below:

The general subject of each matter to be considered while the public is excluded, the reason for passing this resolution in relation to each matter, and the specific grounds under section 48(1) of the Local Government Official Information and Meetings Act 1987 for the passing of this resolution are as follows:

Item No.

Subject of each matter to be considered

Reason for passing this resolution in relation to each matter

Grounds under Section 48(1) for the passing of this resolution

When the item can be released into the public

8.1

Completed Internal Audit Reviews

Withholding the information is necessary to protect information which is subject to an obligation of confidence or which any person has been or could be compelled to provide under the authority of any enactment, where the making available of the information would be likely to prejudice the supply of similar information, or information from the same source, and it is in the public interest that such information should continue to be supplied.

48(1)(a)(i) Section 7 (2)(c)(i).

On the Chief Executive's approval.

8.2

Key Risk Register

Withholding the information is necessary to prevent the disclosure or use of official information for improper gain or improper advantage.

48(1)(a)(i) Section 7 (2)(j).

On the Chief Executive's approval.

 

Decisions Required

8.1      Completed Internal Audit Reviews

Attachment 1 - Executive Summary - Project Management framework review

Attachment 2 - Executive Summary - Compliance internal audit

Attachment 3 - Executive Summary - Payroll internal audit

Information Only

8.2      Key Risk Register

Attachment 1 - Key risk register - Dec 2022

Attachment 2 - KRR - Heat Map Dec 2022

9.       Public Excluded Business to be Transferred into the Open

10.     Readmit the Public

11.     Consideration of Items not on the Agenda


 

 

 

 

Report To:

Risk and Assurance Committee

Meeting Date:

8 March 2023

Report Writer:

Mat Taylor, General Manager, Corporate

Report Authoriser:

Mat Taylor, General Manager, Corporate

Purpose:

Update on Risk and Assurance Committee Activities

 

 

Chairperson's Report

 

Executive Summary

This report provides the Committee with an update on Risk and Assurance Committee activities.

 

Recommendations

That the Risk and Assurance Committee:

1        Receives the report, Chairperson's Report.

 

1.        Introduction

The report shows an updated Risk and Assurance Work Programme and an updated Risk and Assurance Completed Work Programme.

1.1      Legislative Framework

1.2      Alignment with Strategic Framework

 

A Healthy Environment

Freshwater for Life

Safe and Resilient Communities

A Vibrant Region

The Way We Work

We continually seek opportunities to innovate and improve.

1.2.1    Community Well-beings Assessment

Dominant Well-Beings Affected

¨ Environmental

 

¨ Cultural

 

¨ Social

 

þ Economic

 

 

 

 

2.        Council Performance Monitoring Report – Detailed Briefings for Councillors

The following financial monitoring meeting (detailed financial briefing) was held with Councillors:

Tuesday, 13 December 2022

3.        Risk and Assurance Work Programme

Appendix 1 shows the Risk and Assurance Work Programme for 2023. This Work Programme sets out the planned and scheduled reporting to the Risk and Assurance Committee.

The appendix is categorised to identify the broad areas of responsibility for the Committee. Other items may be added by councillors and staff should this be required to respond to issues as they occur throughout the year.

4.        Risk and Assurance Completed Work Programme

Appendix 2 shows the Risk and Assurance Completed Work Programme for the 2022 year.

5.        Considerations

5.1      Risks and Mitigations

There are no significant risks associated with this matter/subject/project/initiative.

5.2      Climate Change

The matters addressed in this report are of a procedural nature and there is no need to consider climate change impacts.

5.3      Implications for Māori

There are no implications for Māori.

5.4      Community Engagement

5.5      Financial Implications

This work is being undertaken within the current budget for the Governance Activity in Year 1 of the Long Term Plan 2021 – 2031.

6.        Next Steps

None.

 

Attachments

Attachment 1 - Risk and Assurance Work Programme for 2023

Attachment 2 - Risk and Assurance Completed Work Programme for March to September 2022  

 


Risk and Assurance Committee                                                                                                8 March 2023

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Risk and Assurance Committee                                                                                                8 March 2023

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Report To:

Risk and Assurance Committee

Meeting Date:

8 March 2023

Report Writer:

Nolene Naude, Financial Accounting Team Lead and Kumaren Perumal, Chief Financial Officer

Report Authoriser:

Mat Taylor, General Manager, Corporate

Purpose:

The Risk and Assurance Committee to receive the Audit New Zealand Report on the audit of the Bay of Plenty Regional Council for the year ending 30 June 2022 (Attachment 1)

 

 

Audit New Zealand Report on the audit of the Bay of Plenty Regional Council for the year ended 30 June 2022

 

Executive Summary

The purpose of this report is to present the Audit New Zealand Report on the audit of the Bay of Plenty Regional Council for the year ending 30 June 2022 (the report). The report outlines audit findings, recommendations (with accompanying management responses) and prioritises them as urgent, necessary or beneficial. There are a total of eight open recommendations as at 30 June 2022.

There were no recommendations prioritised as urgent.

There were seven recommendations prioritised as necessary and one prioritised as beneficial.

 

Recommendations

That the Risk and Assurance Committee:

1        Receives the report, Audit New Zealand Report on the audit of the Bay of Plenty Regional Council for the year ended 30 June 2022.

 

 

1.        Introduction

The report sets out findings arising from the final audit performed over the period October to December 2022.

Audit New Zealand has identified areas where Council is performing well along with recommendations for areas where improvements can be made. The report also provides an update on action taken by staff against previous audit recommendations. The final report includes management responses where appropriate.

The report includes the results for Council and the Quayside Group. The results for Council are summarised below.

1.1      Alignment with Strategic Framework

 

The Way We Work

We deliver value to our ratepayers and our customers.

The report provides audit findings on the overall performance of Council outlining recommendations for improvement and progress against prior recommendations. As a result, it supports the delivery of all four Community Outcomes and the Way We Work.

1.1.1    Community Well-beings Assessment

Dominant Well-Beings Affected

þ Environmental

 

þ Cultural

 

þ Social

 

þ Economic

 

 

The report outlines audit findings on Council’s financial and non-financial performance for the year ending 30 June 2022, recommendations for improvement and progress on management’s response to prior year recommendations and promotes all four aspects of community well-being.

2.        Findings from the report

The report to Council outlines the matters identified during the audit, new recommendations, and the status of previous recommendations.

In addition to the above, the report also includes the outcome of matters raised in the Audit Plan.

There were three new necessary recommendations raised. Detailed information for each recommendation can be found in Attachment 1.

There are ten previous recommendations of which five are closed and five open. A status summary of Audit New Zealand’s recommendations is set out in the following table:

Table 1 Status of Audit New Zealand Recommendations:

Priority

Previous Open Action

New Actions

Closed Actions

Current Open Actions

Beneficial

2

-

1

1

Necessary

8

3

4

7

Urgent

-

-

-

-

Total

10

3

5

8

 

3.        Considerations

3.1      Risks and Mitigations

There are no direct risk implications arising from this report.

3.2      Climate Change

The matters addressed in this report are of a procedural nature and there is no need to consider climate change impacts.

3.3      Implications for Māori

There are no direct implications for Māori arising from this report.

3.4      Community Engagement

 

Engagement with the community is not required as the recommended proposal / decision relates to internal Council matters only.

 

3.5      Financial Implications

There are no material unbudgeted financial implications and this fits within the allocated budget.

4.        Next Steps

Audit New Zealand has highlighted recommendations from the final audit for the year ending 30 June 2022. These have been appropriately noted and actions are underway to address the remaining open recommendations.

 

Attachments

Attachment 1 - Audit New Zealand Report on the Audit of BOPRC for year ended 30 June 2022  

 


Risk and Assurance Committee                                                                               8 March 2023

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Report To:

Risk and Assurance Committee

Meeting Date:

8 March 2023

Report Writer:

Olive McVicker, Corporate Performance Team Lead; Mark Le Comte, Principal Advisor, Finance and Gillian Payne, Principal Advisor

Report Authoriser:

Mat Taylor, General Manager, Corporate

Purpose:

To update the Committee on efficiency and effectiveness improvements, and progress on the regional benchmarking project

 

 

Efficiency and Effectiveness Gains and Progress on Benchmarking

 

Executive Summary

During the last 12 months, organisational improvements have been planned or implemented to achieve measurable gains in efficiency (cost or time savings, improved quality or reliability) and/or effectiveness (improved outcomes). Some of these are described in section 2 of this report.

BOPRC has initiated a regional and unitary councils’ benchmarking group. The draft templates to gather information have been designed and shared with a key partner council for feedback, following which it will be shared with the other participants. 

It is important that the participants are involved in co-design to some extent, to ensure the scope and level of detail of the results meet their needs.  Without ongoing commitment of comparator councils over the medium term, the benchmarking effort will be wasted. As a result, the initiative is planned to start small and evolve in scope and detail as agreed by participants.

During upcoming development of the Long-Term Plan 2024-2034, Councillors will have the opportunity to review performance targets (outcomes measures and levels of service) and the budgets to achieve them.

 

Recommendations

That the Risk and Assurance Committee:

1        Receives the report, Efficiency and Effectiveness Gains and Progress on Benchmarking.

 1.    Introduction

On 14 April 2022 the Risk and Assurance Committee considered a report outlining the frameworks and processes used to understand, measure and report effectiveness and efficiency in the delivery of Council’s services.  It also provided background covering concepts and terminology used when discussing cost effectiveness and performance measures and target setting.

A draft Terms of Reference was presented, and the Committee recommended that “the Efficiency and Effectiveness Terms of Reference (be) referred to the Council to be established following the Triennium elections to be added to the work programme”. This has been done through setting performance expectations for the Chief Executive. 

1.1      Legislative Framework

The Local Government Act 2002(LGA) s17A requires reviews of the cost-effectiveness of current delivery arrangements, provided the potential benefits of the review outweigh the cost of conducting it, in Council’s opinion. Reviews are not required where the activity is governed by legislation or a contract that cannot be reasonably altered within two years.

Where a full review is considered worthwhile, the scope of the review is specified in LGA s17A(4).

17A (4) A review under subsection (1) must consider options for the governance, funding, and delivery of infrastructure, services, and regulatory functions, including, but not limited to, the following options:

(a)  responsibility for governance, funding, and delivery is exercised by the local authority:

(b)  responsibility for governance and funding is exercised by the local authority, and responsibility for delivery is exercised by—

          (i) a council-controlled organisation of the local authority; or

          (ii) a council-controlled organisation in which the local authority is one of several shareholders; or

          (iii) another local authority; or

          (iv) another person or agency:

(c)  responsibility for governance and funding is delegated to a joint committee or other shared governance arrangement, and responsibility for delivery is exercised by an entity or a person listed in paragraph (b)(i) to (iv).

1.2      Alignment with Strategic Framework

 

The Way We Work

We continually seek opportunities to innovate and improve.

We deliver value to our ratepayers and our customers.

We look to partnerships for best outcomes.

Efficiency and effectiveness work seeks to improve the services we deliver and reduce costs. Benchmarking is an important step in improvement processes that can highlight where there are opportunities to learn from others or share our practices for others to improve.

1.2.1    Community Well-beings Assessment

Dominant Well-Beings Affected

¨ Environmental

 

¨ Cultural

 

¨ Social

 

¨ Economic

Medium - Positive

 

Efficiency initiatives primarily affect the economic well-being of residents, through lower costs for the same service, but improvements in effectiveness could affect any of the well-beings, depending on the activity to which they relate. 

2.        Efficiency and effectiveness initiatives

2.1      Approach to operational improvements

Activity managers are responsible for identifying opportunities in their day-to-day work, both incremental improvements and more substantial reviews. The results of improvements are shared with Councillors as part of reports to various Committees. 

The internal audit team, as part of their reviews, provides an independent view of operational processes and can help identify opportunities for improvement.  These are shared with managers through recommendations.  The internal audit team reports quarterly to the Risk and Assurance Committee.

The examples below are not an exhaustive list but intended to give a picture of recent initiatives and their monitoring.

2.2      Results of improvement initiatives

2.2.1    Rates collection moves in-house

What was changed?

In-house collection of rates rather than contracting territorial authorities to collect rates on our behalf.

Efficiency benefits realised

As reported to the Monitoring and Operations Committee on 7 March 2023, efficiency benefits include:

·      producing service delivery cost savings for ratepayers

·      increased control of rates processes.

·      earlier cash receipts and additional interest revenue

Effectiveness benefits realised

As reported to the Monitoring and Operations Committee on 7 March 2023, effectiveness benefits include:

·      developing a customer centric service,

·      providing better visibility of the relationship between rates and the services they fund

·      establishing direct relationships with our ratepayers

·      improving the opportunity for collaboration with local authorities in the region

Timeframe for benefits

On-going

2.2.2    Legal services

What was changed?

Legal team created in FY 2020/21

Efficiency benefits realised

As reported to Risk and Assurance Committee in September 2022:

·      since the team was created, external legal spend fell from $1.9 million in 2019/20 to $1.1 million in 2021/22.

·      the in-house team performs 7,124 hours of legal work per year. If this same number of hours were provided by local external legal partners, it would lead to a cost of around $2.9 million.

Timeframe for benefits

On-going benefits. Further work is planned to identify additional opportunities to avoid external legal spend.

2.3      Key improvement initiatives underway or planned

2.3.1    Project Insight – Phases 1 and 2

What is it?

Development of an interactive tool for Councillors to monitor financial performance at desired levels of detail (Stage 1A) and linking it to non-financial performance information (Stage 1B)

Progress

Stage 1A substantially complete and ready for launch

Stage 1B in design stage.

Efficiency benefits expected

Expected efficiencies are not yet realised because prior to full implementation, manual reporting processes are still necessary. 

Once Phase 2 implementation (non-financial information) is completed, time taken for staff to produce quarterly reports will reduce as manual compilation of Arotake report will cease.

Effectiveness benefits expected

Stage 1A:

·      Greater transparency of financial reporting for Councillors.

·      Ability of Councillors to choose the level of detail they see and how it is presented.

·      Faster turnaround of financial results after close of quarter.

Stage 1B

·      Linking non-financial targets with financial budgets to enable decision-making about priorities.

When and how will benefits be measured?

Baselines will be established to measure current effort for manual processes.

For Stage 1A, user satisfaction feedback expected by June 2023.

 

2.3.2    Laboratory Services operational review

What is it?

A review was undertaken in 2022 to determine if the current laboratory service is being utilised to maximum benefit, and to identify improvements opportunities

Progress

Review has been completed and was reported to Risk and Assurance in September 2022.  Some improvements are planned for 2023 and other opportunities will be explored, and proposals developed for the 2024-2034 LTP.

Efficiency benefits expected

·      Automated billing freeing up lab staff time for value-add activity

·      Business process changes

Effectiveness benefits expected

·      Equipment upgrades to process more tests in a shorter time

When and how will benefits be measured?

Results will be reported to Risk and Assurance Committee through the internal audit quarterly updates.

2.3.3    Further improvements to rates collection service

What is it?

During implementation of the rates collection service, opportunities for improvement were identified.

Progress

A two-year programme has been developed (as reported to the Monitoring and Operations Committee on 7 March 2023)

Benefits expected

·      Review and resolve anomalies in historical rating

·      Review and update river scheme rating categories to take account of property changes, reduce complexity and ensure charges are fair and equitable.

When and how will benefits be measured?

Progress and results will be reported to Monitoring and Operations on a regular basis.

3.        Benchmarking initiative

3.1      Purpose and approach

Benchmarking aspects of Council’s performance can highlight areas where there may be opportunities to learn from others and improve performance. 

Council has participated in previous benchmarking initiatives involving the regional sector, most notably an initiative in 2012-2017 known as Benchmarking Administrative and Support Services (BASS).  The regional sector adapted the framework from one designed for central government agencies; it was very precise and detailed and support for the initiative waned, partly due to the administrative overhead involved in standardising and collecting the input data.

BOPRC has initiated a regional and unitary councils’ benchmarking group, excluding Auckland and Chatham Islands. Learning from previous experience, the approach of the current initiative is:

Start with the basics and build on what works, is administratively sustainable and produces actionable results

Measures should be designed so that results can help identify improvement opportunities and innovation, to ultimately benefit the community, rather than aiming to rank performance

Recognise that comparing apples with apples is ideal, but apples with pears may be enough to identify opportunities to explore better ways of doing things. 

This approach means that success will be measured by whether the benchmarking information proves useful in spotting opportunities and encouraging exchange of ideas.  Producing league tables will be avoided because ranking the results that compare “apples and pears” will be misleading and could have a negative effect on participation.  Instead of spending excess time standardising data so that league tables are comparable, more time will be spent understanding the differences lying behind the results and asking ourselves questions about what that means for efficiency and effectiveness.

3.2      Progress to date

Draft templates to gather information have been designed and shared with a key partner council for feedback, following which it will be shared with the other participants and a timetable for the first round of information gathering can be agreed between the participants.

It is important that the participants are involved in co-design of the measures to some extent, to ensure the scope and level of detail of the results meet their needs and their capacity to deliver the information on time.

4.        Considerations

4.1      Risks and Mitigations

The greatest risk to this project is losing support for the project among the comparator councils. Without ongoing commitment of comparator councils over the medium term, the benchmarking effort will be wasted. As a result, the initiative is planned to start small and evolve in scope and detail, through negotiation and consensus of the participants.  This could affect the pace of the project and its development.

4.2      Climate Change

The matters addressed in this report are of a procedural nature and there is no need to consider climate change impacts.

4.3      Implications for Māori

There are no specific implications for Māori arising from this report.

4.4      Community Engagement

 

Engagement with the community is not required as the recommended proposal / decision relates to internal Council matters only.

 

 

4.5      Financial Implications

Financial costs and benefits arising from improvement initiatives will be apparent in the budgets of the activities concerned.

By taking part in the benchmarking initiative, staff time covered by current budgets is committed, which will reduce the time available for other new initiatives that may be identified in future.

5.        Next Steps

Progress on both benchmarking and measuring efficiency and effectiveness gains will reported to the Committee again in September 2023.

During upcoming development of the Long-Term Plan 2024-2034, Councillors will have the opportunity to review levels of service and budgets for activities.  This is the process through which performance targets (outcomes measures and levels of service) and budgets to achieve them are primarily set.

 

 

 


 

 

 

 

Report To:

Risk and Assurance Committee

Meeting Date:

8 March 2023

Report Writer:

Aaron Huggins, Principal Internal Auditor

Report Authoriser:

Mat Taylor, General Manager, Corporate

Purpose:

To provide an update on the internal audit program and the audit plan.

 

 

Internal Audit Status Update

 

Executive Summary

This report provides an update on the status of internal audit activities as at 31 December 2022 and includes:

·           The status of internal audit reviews in the current year;

·           The status of follow up of internal audit recommendations and management actions to 31 December 2022.

 

Recommendations

That the Risk and Assurance Committee:

1        Receives the report, Internal Audit Status Update.

 

 

1.        Introduction

This report provides an update on internal audit activity undertaken by internal audit staff and external assurance specialists as part of Bay of Plenty Regional Council’s co-sourced internal audit approach.  It includes:

·      The status of internal audit reviews in the current year;

·      The status of follow up of internal audit recommendations and management actions to 31 December 2022.

 

1.1      Alignment with Strategic Framework

 

The Way We Work

We continually seek opportunities to innovate and improve.

 

 

2.        Internal Audit Work Plan 2022/23 Status

Based on the Internal Audit Work Plan 2022/23 the following table summarises the status of internal audit reviews for 2022/23.

Review

Field work

GM Sponsor

Status

Status of Internal Audit

Planning /Scope

Fieldwork

Draft Report

Mgmt Actions

Final Report

CDEM Administering Authority

BOPRC

Regulatory Services

In Progress

Complete

 

 

 

 

Compliance process

BOPRC

Regulatory Services

Complete

Complete

Complete

Complete

Complete

Complete

Focus Catchments

BOPRC

Integrated Catchments

In Progress

Complete

 

 

 

 

Payroll

BOPRC

People & Leadership

Complete

Complete

Complete

Complete

Complete

Complete

Protected Disclosures (Whistleblower)

BOPRC

People & Leadership

In Progress

Complete

 

 

 

 

Rates process review

BOPRC

Corporate

In Progress

Complete

 

 

 

 

Climate change

BOPRC

Integrated Catchments

In Progress

Complete

In Progress (25%)

 

 

 

Project management (21/22)

BOPRC

Corporate

Complete

Complete

Complete

Complete

Complete

Complete

Delivery of the 2022/23 internal audit programme is currently progressing on schedule.

3.        Internal Audit Follow Up

Internal Audit has reviewed all open management actions as part of the follow up work in the 2022/23 Work Plan.

3.1      Management actions

At the start of the half-year (1 July 2022) there were 66 open management actions.

The following graph highlights the progress made within BOPRC to address open audit actions during the half-year to 31 December 2022:

Figure 1 Open management actions (1 July 2022 vs 31 December 2022)

During the half-year five actions were closed and seventeen actions were added. The total of actions open as at 31 December 2022 is 80, the majority of these relate to ICT Security (28), Regional Pest Management Plan (13), and Policy Framework (10).

For the remaining longer-standing audit actions work streams continue to be underway to address the open audit actions:

·      Procurement & Contract Management – The Financial Delegations Manual is currently being updated, and training is being delivered to staff on the recently introduced contracts module within BOPRC’s financial management information system (Tech1).

·      Fraud Risk Assessment – work is underway to update contract workflow rules, implement updated dashboard reporting, and update purchasing workflow rules.  This is estimated to be complete by July 2023.

·      Gravel Extraction – the three open actions relate to updating the Regional Gravel Management Plan and reviewing the associated fees and charges.  This will be addressed as part of the next Long Term Plan.

·      Policy Framework – work is underway to address the recommendations in alignment with BOPRC’s Toi Tangata People Plan.

For the ICT Security audit, a Cyber Security Strategy is being finalised.  Project charters and scopes have been prepared to address the higher risk actions, and process reviews are intended to be undertaken to address the moderate and low risk actions.

The remaining audit actions relate to Internal Audit Reviews completed later during the 2021/22 financial year through to the 2022/23 financial year and are not yet due for completion.

 

3.2      Improvement actions

At the start of the half-year (1 July 2022) there were twenty-one open improvement actions.  These typically have a longer estimated completion timeframe than audit actions, and refer to operational improvements rather than formal risk mitigations.

The following graph highlights the progress made within BOPRC to address open improvement opportunity actions during the half-year to 31 December 2022:

Figure 2 Open improvement actions (1 July 2022 vs 31 December 2022)

 

The Health & Safety improvement remains open and refers to the last phase of the critical risk project rollout.

The Risk Management and the Laboratory Services Benefits Realisation reviews were completed during the 2021/22 financial year and are not yet due for completion.

 

4.        Considerations

4.1      Risks and Mitigations

There are no significant risks associated with this matter/subject/project/initiative.

4.2      Climate Change

The matters addressed in this report are of a procedural nature and there is no need to consider climate change impacts.

4.3      Implications for Māori

No implications identified – matters are of a procedural nature only.

4.4      Community Engagement

 

Engagement with the community is not required as the recommended proposal / decision [relates to internal Council matters only].

 

4.5      Financial Implications

There are no material unbudgeted financial implications and this fits within the allocated budget.

 

5.        Next Steps

To note the Internal Audit status update (as at 31 December 2022).