Agenda of Risk and Assurance Committee

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.

Risk and Assurance Committee 5 June 2024

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. Minutes

Minutes to be Confirmed

7.1 Risk and Assurance Committee Minutes - 6 March 2024 2

8. Reports

8.1 Chairperson's Report 2

Attachment 1 - Risk and Assurance Work Programme Sept 2024 - Jun 2025 2

Attachment 2 - Risk and Assurance Completed Work Programme March 2023 to March 2024 2

8.2 Audit New Zealand Report on the audit of the Bay of Plenty Regional Council for the year ended 30 June 2023 2

Attachment 1 - Report to Council on the audit of BOPRC for year ending 30 June 2023 2

8.3 Audit New Zealand Report on the audit of the Long Term Plan 2024 - 2034 Consultation Document 2

Attachment 1 - Report to Council on the audit of the BOPRC LTP 2024-34 Long Term Plan Consultation Document 2

8.4 Rates Setting for 2024/25 Financial Year - Legal Compliance 2

8.5 Internal Audit Work Plan 2024/25 to 2026/27 2

Attachment 1 - BOPRC Internal Audit Work Plan FY2025-27 2

8.6 Internal Audit Status Update 2

9. 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
9.1	Public Excluded Risk and Assurance Committee Minutes - 6 March 2024	As noted in the relevant Minutes.	As noted in the relevant Minutes.	To remain in public excluded.
9.2	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.
9.3	Key Risks Workshop 2024 - Update	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.
9.4	Key Risk Register - March 2024	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.
9.5	Update on Flood Implications Work Programme	Withholding the information is necessary to maintain legal professional privilege.	48(1)(a)(i) Section 7 (2)(g).	On the Chief Executive's approval.

Minutes to be Confirmed

9.1 Public Excluded Risk and Assurance Committee Minutes - 6 March 2024

Reports

9.2 Completed Internal Audit Reviews

Attachment 1 - Executive Summary - Sensitive Expenditure

Attachment 2 - Executive Summary - CDEM Administering Authority

9.3 Key Risks Workshop 2024 - Update

Attachment 1 - Risk and Assurance Committee - Public Excluded Workshop Notes - 6 March 2024

Attachment 2 - Draft Key Risk Register Example

9.4 Key Risk Register - March 2024

Attachment 1 - Key Risk Register - March 2024

Attachment 2 - KRR - Heat Map March 2024

9.5 Update on Flood Implications Work Programme

Attachment 1 - Current Potential Liabilities - June 2024

10. Public Excluded Business to be Transferred into the Open

11. Readmit the Public

12. Consideration of Items not on the Agenda

Risk and Assurance Committee Minutes

6 March 2024

Risk and Assurance Committee

Open Minutes

Commencing: Wednesday 6 March 2024, 10.00am

Venue: Council Chambers, Regional House, 1 Elizabeth Street, Tauranga, and via Zoom (audio visual meeting)

Chairperson: Bruce Robertson (Independent Member)

Members: Cr Stuart Crosby (via Zoom)

Cr Ron Scott (via Zoom)

Cr Andrew von Dadelszen

Cr Te Taru White

Cr Kevin Winters

Chairman Doug Leeder (Ex Officio)

In Attendance: Councillors: Cr Matemoana McDonald (via Zoom), Cr Jane Nees, Cr Paula Thompson (via Zoom), Cr Lyall Thurston (via Zoom)

Staff: Fiona McTavish – Chief Executive; Mat Taylor – General Manager, Corporate; Kumaren Perumal – Chief Financial Officer; Nolene Naude – Financial Accounting Team Lead (via Zoom); Steven Slack – Risk & Assurance Manager; Monique Brooks - Legal and Commercial Manager; Jenny Teeuwen – Committee Advisor

External: Leon Pieterse and Warren Goslett - Audit New Zealand

As Chairperson Cr Stuart Crosby was unable to attend the meeting in person, the Deputy Chairperson Bruce Robertson, assumed the Chair for this meeting.

1. Chairperson’s Opening Statement

The Chairperson Bruce Robertson declared the meeting open and immediately adjourned the meeting.

10.02am – the meeting adjourned.

10.20am – the meeting reconvened.

When the meeting reconvened, the Chairperson reminded members and the public that the public section of the meeting was being livestreamed and recorded and that the recording would be available on the Bay of Plenty Regional Council YouTube channel following the meeting.

Recording link: Risk and Assurance Committee - 6 March 2024 (youtube.com)

2. Declaration of Conflicts of Interest

None declared.

3. Minutes

Minutes to be Confirmed

3.1

Risk and Assurance Committee Minutes - 7 December 2023

Resolved

That the Risk and Assurance Committee:

1 Confirms the Risk and Assurance Committee Minutes - 7 December 2023 as a true and correct record.

Robertson/White

CARRIED

4. Reports

4.1

Chairperson's Report

Presented by: Mat Taylor – General Manager, Corporate

Resolved

That the Risk and Assurance Committee:

1 Receives the report, Chairperson's Report.

von Dadelszen/Winters

CARRIED

4.2

External Audit Engagement Letter: Audit of the Consultation Document and 2024 - 2034 Long-Term Plan (LTP)

Presented by: Kumaren Perumal – Chief Financial Officer

Nolene Naude – Financial Accounting Team Leader (via Zoom)

Leon Pieterse – Audit New Zealand

Warren Goslett – Audit New Zealand

In Response to Questions

· Audit New Zealand advised that they were on track with the LTP audit.

Resolved

That the Risk and Assurance Committee:

1 Receives the report, External Audit Engagement Letter: Audit of the Consultation Document and 2024 - 2034 Long-Term Plan.

Robertson/Winters

CARRIED

4.3

External Audit Plan 2023/24

Presented by: Kumaren Perumal – Chief Financial Officer

Nolene Naude – Financial Accounting Team Leader

Leon Pieterse – Audit New Zealand

Warren Goslett – Audit New Zealand

In Response to Questions

· Audit New Zealand were comfortable that the Audit Plan for the Annual Report 2023/24 audit deadlines were achievable.

· Quayside’s audit timeframes were not expected to delay Audit New Zealand timeframes for the BOPRC audit.

· The LTP audit was going well, although acknowledged timeframes were tight.

· Provided explanation for Audit Plan (Attachment 1) terminologies - uncorrected misstatements (Page 10 of Audit Plan), and material measures/materiality (Page 11 of Audit Plan).

Resolved

That the Risk and Assurance Committee:

1 Receives the report, External Audit Plan 2023/24.

White/Robertson

CARRIED

10.45am – Cr Scott withdrew from the meeting.

4.4

Internal Audit Status Update

Presented by: Steve Slack - Risk & Assurance Manager

Key Points

· Noted a correction in the report for Table 1 - 2.1 Cryptography (page 63 of the agenda): the due date had been extended from 30 November 2023 to December 2024, therefore the item was not overdue for completion.

In Response to Questions

· No incidents of fraud had been reported within the organisation in the past year. As part of BOPRC’s fraud policy, Councillors would be informed if fraud activity had been identified. Many internal audits included a fraud component, and an organisation wide fraud risk assessment review was also undertaken as part of the audit programme.

· Misinformation versus fraud was dependent on circumstances.

· Noted that following the resolution of the Strategy and Policy Committee at their meeting on 20 February 2024 to “extend the timeframe for notifying proposed Regional Policy Statement (RPS) Change 7 (Freshwater) and proposed Regional Natural Resources Plan (RNRP) Change 19 (Freshwater) from December 2024 to September 2025”, the status of the Freshwater Management Key Risk Mitigations internal audit review was no longer on hold. Whether the item could be signed off as completed would be reported back to the June meeting of this committee.

Resolved

That the Risk and Assurance Committee:

1 Receives the report, Internal Audit Status Update.

Winters/White

CARRIED

1. Public Excluded Section

Resolved

Resolution to exclude the public

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

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
1.1	Public Excluded Risk and Assurance Committee Minutes - 7 December 2023	As noted in the relevant Minutes.	As noted in the relevant Minutes.	To remain in public excluded.
1.2	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.

Robertson/Winters

CARRIED

11.12am – the meeting closed.

Confirmed

Cr Stuart Crosby

Chairperson, Risk and Assurance Committee



Report To:	Risk and Assurance Committee
Meeting Date:	5 June 2024
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 for the year ahead, and an updated Risk and Assurance Completed Work Programme.

1.1 Alignment with Strategic Framework

The Way We Work

We continually seek opportunities to innovate and improve.

1.1.1 Community Well-beings Assessment

Dominant Well-Beings Affected

¨ Environmental

¨ Cultural

¨ Social

þ Economic

2. Risk and Assurance Work Programme

Attachment 1 shows the Risk and Assurance Work Programme for 2024. This Work Programme sets out the planned and scheduled reporting to the Risk and Assurance Committee.

The attachment 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.

3. Risk and Assurance Completed Work Programme

Attachment 2 shows the Risk and Assurance Completed Work Programme for the period March 2023 – March 2024.

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

There are no implications for Māori.

4.4 Financial Implications

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

Attachments

Attachment 1 - Risk and Assurance Work Programme Sept 2024 - Jun 2025 ⇩

Attachment 2 - Risk and Assurance Completed Work Programme March 2023 to March 2024 ⇩



Report To:	Risk and Assurance Committee
Meeting Date:	5 June 2024
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 2023

Audit New Zealand Report on the audit of the Bay of Plenty Regional Council for the year ended 30 June 2023

Executive Summary

The purpose of this report is to present the Audit New Zealand Report (the Report) on the audit of the Bay of Plenty Regional Council for the year ending 30 June 2023. The report outlines audit findings, recommendations (with accompanying management responses) and prioritises them as urgent, necessary or beneficial. There are a total of seven open recommendations as at 30 June 2023, prioritised as necessary.

There were no recommendations prioritised as urgent.

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 2023.

1. Introduction

The Report sets out findings arising from the final audit performed over the period August to October 2023.

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 2023, 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 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 nine previous recommendations of which five are closed and four 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	1	-	1	-
Necessary	8	3	4	7
Urgent	-	-	-	-
Total	9	3	5	7

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 2023. These have been appropriately noted and actions are underway to address the remaining open recommendations.

Attachments

Attachment 1 - Report to Council on the audit of BOPRC for year ending 30 June 2023 ⇩



Report To:	Risk and Assurance Committee
Meeting Date:	5 June 2024
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 Long Term Plan 2024 – 2034 Consultation Document

Audit New Zealand Report on the audit of the Long Term Plan 2024 - 2034 Consultation Document

Executive Summary

The purpose of this paper is to present the Audit New Zealand Report (the Report) on the audit of the Bay of Plenty Regional Council Long Term Plan 2024 – 2034 Consultation Document (LTP CD). The Report outlines the scope of the audit review of Council’s LTP CD and supporting documents, plans, and processes.

Audit New Zealand issued an unmodified audit opinion, with an emphasis of matter on 6 March 2024 on the LTP CD.

Recommendations

That the Risk and Assurance Committee:

1 Receives the report, Audit New Zealand Report on the audit of the Long Term Plan 2024 - 2034 Consultation Document.

1. Introduction

The Report sets out findings arising from the audit performed on the LTP CD.

Audit New Zealand (Audit NZ) has identified key findings in relation to the content of the consultation document, financial model and forecasts and the performance management framework.

1.1 Alignment with Strategic Framework

A Healthy Environment	We develop and implement regional plans and policy to protect our natural environment.
Freshwater for Life	We listen to our communities and consider their values and priorities in our regional plans.
Safe and Resilient Communities	We work with our partners to develop plans and policies, and we lead and enable our communities to respond and recover from an emergency.
A Vibrant Region	We contribute to delivering integrated planning and growth management strategies especially for sustainable urban management.
The Way We Work	We deliver value to our ratepayers and our customers.

The Report sets out findings on the LTP CD, which has a primary purpose of the provision of an effective basis for public participation in decisions on the content of the Long Term Plan 2024 -2034. As a result, it supports the delivery of all four Community Outcomes.

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 planning and processes for the LTP CD and promotes all four aspects of community well-being.

2. Findings from the report

The Report outlines the findings from the audit of the LTP CD, including the findings on the main risks and issues identified in the Audit Plan.

2.1 Audit Plan

During the planning stage of the audit, and during the review of the content of the LTP CD, Audit NZ identified the following areas of audit focus and issues:

· Impact of current economic environment on Council’s forecasts

· Central Government reforms

· Financial and Infrastructure strategies

· Assumptions

· Quality of asset-related forecasting information

Audit NZ have reviewed the assumptions applied in the financial forecasting and underlying supporting documents to the LTP CD, including Council’s response to the government reforms and consider these to be reasonable.

The financial strategy is reasonable, financially prudent and compliant with legislation.

The infrastructure strategy is fit for purpose, aligned with asset management plans and the financial strategy.

Two key assumptions have been highlighted by Audit NZ as challenging or important to emphasize. They relate to capital expenditure deliverability and climate change.

Due to the uncertainties pertaining to the organisation’s capacity to deliver on the forecast capital programme, Audit NZ have included an Emphasis of Matter in their Audit Report (received by Council on 6 March 2024).

2.2 Other matters

The other matters outlined in the Report relate to:

· The content of the consultation document

· The financial model and forecasts

· The performance management framework

The Report does not identify any significant concerns regarding the matters listed above.

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

Consultation and engagement incorporated a focus on iwi/Māori to ensure their views were incorporated into the Long Term Plan deliberations. The Audit NZ audit report to Council is of a procedural nature and there is no need to specifically consider the implications for Māori.

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 NZ will commence their final audit of Council’s Long Term Plan 2024 - 2034 on 6 June 2024, and expect to issue an audit opinion at the Council meeting scheduled on 26 June 2024.

Attachments

Attachment 1 - Report to Council on the audit of the BOPRC LTP 2024-34 Long Term Plan Consultation Document ⇩



Report To:	Risk and Assurance Committee
Meeting Date:	5 June 2024
Report Writer:	Mark Le Comte, Principal Advisor, Finance and Kumaren Perumal, Chief Financial Officer
Report Authoriser:	Mat Taylor, General Manager, Corporate
Purpose:	For the Risk and Assurance Committee to receive confirmation that the rates setting process for 2023/24 is legally compliant.

Rates Setting for 2024/25 Financial Year - Legal Compliance

Executive Summary

This report outlines the process to ensure that the Bay of Plenty Regional Council rates setting recommendations are legally compliant for the 2024/25 financial year.

An external legal review of the rates resolution and rates Funding Impact Statement for 2024/25 financial year is in progress. The amount of each rate and the relevant dates relating to arrears being collected by other councils will be added to the final rates setting report, when it is available.

Council is scheduled to set rates for the 2024/25 financial year at its meeting on 26 June 2024.

Recommendations

That the Risk and Assurance Committee:

1 Receives the report, Rates Setting for 2024/25 Financial Year - Legal Compliance.

2 Notes that an external legal review of the Rates Setting process and draft Rates Resolution is in progress.

1. Introduction

Setting rates for the financial year requires Council resolutions that comply with the requirements of the Local Government Act 2002 (LGA) and the Local Government (Rating) Act 2002 (LG(R)A).

1.1 Legislative Framework

The LGA and LG(R)A set out the processes required to set rates. This involves adoption of the Long Term Plan, including the Funding Impact Statement (FIS), and then setting rates for the financial year in accordance with the FIS. The rates set are required to be consistent with the Revenue and Financing Policy (RFP).

1.2 Alignment with Strategic Framework

A Healthy Environment
Freshwater for Life
Safe and Resilient Communities
A Vibrant Region
The Way We Work	We deliver value to our ratepayers and our customers.

Rates revenue supports the delivery of all our work to achieve the Community Outcomes.

1.2.1 Community Well-beings Assessment

Dominant Well-Beings Affected

¨ Environmental

¨ Cultural

¨ Social

¨ Economic

The purpose of Local Government includes promoting the social, economic, environmental, and cultural well-being of communities in the present and for the future.

Identify which dominant Community Well-being(s) the project/proposal will affect. Also indicate what level of impact and what effect the project/proposal will have on the relevant well-being(s). For instance consider:

• Will the project/proposal have a high, medium or low impact on the well-being(s)?

• Are the effects of the impacts positive and/or negative?

• Describing simply the overall impact of the project/proposal.

• Providing an explanation if there are positive and negative impacts for each well-being(s).

• Identifying if your assessment of the actual or proposed impact is backed by evidence.

Also consider identifying if there are any relevant considerations against the Living Standards Framework.

Further guidelines available here.

Rates revenue supports the delivery of all of our work to improve the well-beings.

2. Rates Setting

2.1 Rates Resolution

The Rates Resolution is a local authority’s formal legal decision to impose specific rates on a community and creates the obligation to pay. Each rate must be set in accordance with the relevant FIS and Long Term Plan.

The preparation of the Rates Resolution must be in accordance with section 23 of the LG(R)A. The rates set in the resolution must:

a) Relate to a financial year

b) Be set in accordance with the relevant provisions of the Council’s Long Term Plan and FIS for that financial year.

2.2 Long Term Plan

The Long Term Plan shows what the Council intends to do and how it will go about delivering on its objectives for the coming financial years.

The detailed legal requirements for the content of the Long Term Plan are set out in Schedule 10, Part 1 of the LGA. This includes the FIS and rating base information which are directly related to the Rates Resolution.

Deliberations on the draft 2024-2034 Long Term Plan are scheduled for the 28/29 May 2024 Council meeting. Direction from this meeting will be used to prepare the final draft 2024-2034 Long Term Plan including updated financial estimates and FIS.

2.2.1 Funding Impact Statement

The FIS is a detailed explanation to the community of the rates that will be charged, how they will be calculated and what they will be used for. Ratepayers should be able to work out what they will pay from this document.

The FIS must be in the prescribed form, and must identify:

a) The sources of funding to be used by the local authority.

b) The amount of funds expected to be produced from each source; and

c) How the funds are to be applied.

2.3 Revenue and Financing Policy

The RFP sets out the funding sources for each activity, including the proportion of funding from general rates and targeted rates.

Changes to the RFP were consulted on in conjunction with the draft 2024-2034 Long Term Plan. Council will deliberate on the RFP changes at its meeting on 28 and 29 May 2024. Council consulted on several funding ratio changes and the removal of one targeted rate.

3. Local Government Rate Setting Reviews

3.1 Audit Implications

Audit New Zealand carries out a full audit of the draft and final 2024-2034 Long Term Plan. No issues were identified by Audit NZ in relation to the FIS or rates calculation through the audit of the Consultation Document and supporting material. The audit of the final draft 2024-2034 Long Term Plan will commence after the deliberations meeting on 28 and 29 May 2024.

3.2 Legal Review

External legal advice has been sought to perform a statutory compliance review for the 2024/25 financial year’s rate setting process. This review is in progress, and will not be completed until after the draft 2024-2034 Long Term Plan and RFP deliberations have been completed and the relevant changes made in preparation for the Long Term Plan adoption meeting scheduled on 26 June 2024.

4. Considerations

4.1 Risks and Mitigations

Key risks: explain what is unknown and possible financial, health and safety, reputational or environmental impacts could be. Include proposed mitigations. Cover the full range of risks. Consider: Health and Safety, Stakeholder, Legal, Financial, Trade-offs, Timing, and Communications. See Guideline material for details.

Identify the risks that will occur if the above decision is agreed upon vs the risks involved if the above decision is not agreed.

Identify how these risks will be mitigated or minimised.

If unsure or there is any doubt regarding the level of risk, please discuss with your GM.

The main risk relates to the rates setting process not being legislatively compliant. This has been managed through a full external legal review of the FIS and draft Rates Resolution.

Risks related to the amount of rates to be collected and levels of service have been discussed separately through the draft 2024-2034 Long Term Plan process.

4.2 Climate Change

The aim of this section is to ensure your thinking and assumptions around climate change are explicit and to provide visibility as to how our work relates to climate change. Consider:

Use the building block below when considering Climate Change implications.

Crtl + click for guideline material.

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

Council has responsibilities to Māori under the LGA and the RMA. We are required to meet those responsibilities and identify any potential implications for Māori. Please consider including this section for reports going to all committees. The following questions will aid your analysis:

Crtl + click for Guideline material.

Council’s RFP and the policy on the Remission and Postponement of Rates on Māori Freehold Land support the principles set out in the Preamble to Te Ture Whenua Māori Act 1993. Both of these policies have been consulted on in conjunction with the draft 2024-2034 Long Term Plan. Council will deliberate on the policies at its meeting on 28/29 May 2024.

Māori freehold land may, in certain circumstances, be eligible for rates remissions. Māori owners of General Land are affected in the same way as any other member of the community in the same situation regarding property ownership and ability to pay.

4.4 Community Engagement

What level of engagement is council commited to? What actions will be taken

Consider identifying in the report:

• Council’s knowledge of community views on the subject.

• What aspect of the community is involved.

• How the views of the community were obtained.

• How the views were recorded and reported.

CONSULT

Whakauiuia

To obtain input or feedback from affected communities about our analysis, alternatives, and /or proposed decisions.

Council is scheduled to deliberate on the draft 2024-2034 Long Term Plan and RFP at the 28/29 May 2024 Council meeting. This follows a series of draft 2024-2034 Long Term Plan Council workshops through 2023 and public consultation in 2024.

4.5 Financial Implications

If the recommendation is adopted by Council, will it result in:

If the answer is ‘no’ to both questions please select the dropdown option 1 and complete appropriately.

If the answer is ‘yes’ to either question please select “Budget Implications” in the building block below and liaise with your Management Accountant in order to complete the Financial Impact table.

The work required to set rates for 2024/25 is planned under the Finance Activity in the Annual Plan 2023/24. Costs related to rates collection are planned under the Finance Activity in the draft 2024-2034 Long Term Plan.

5. Next Steps

Next Steps: What next? What resources are needed? Further analysis? Timeframes ahead. Any consultation planned. Remind Council of the process ahead. Next update to Council?

Conclusion: Short concluding remarks. Referring back to recommendations. No new content.

The next steps for this process are to finalise the amount of all rates based on decisions from the draft 2024-2034 Long Term Plan deliberations meeting on 28/29 May 2024, and set any relevant dates for rates arrears that remain under the administration of other councils.

At the 26 June 2024 meeting, Council will receive recommendations to adopt the 2024-2034 Long Term Plan and adopt the Rates Resolutions. The adopted rates resolution will be published on Council’s website.



Report To:	Risk and Assurance Committee
Meeting Date:	5 June 2024
Report Writer:	Aaron Huggins, Principal Internal Auditor
Report Authoriser:	Mat Taylor, General Manager, Corporate
Purpose:	To present the updated Internal Audit Work Plan to the Risk and Assurance Committee for approval

Internal Audit Work Plan 2024/25 to 2026/27

Executive Summary

This report presents the updated Internal Audit Work Programme 2024/25. It covers audits to be performed in 2024/25, and potential audits for 2025/26 and 2026/27.

The Risk and Assurance Committee is asked to:

· Review the programme and note if any alterations are required

· Approve the programme

Recommendations

That the Risk and Assurance Committee:

1 Receives the report, Internal Audit Work Plan 2024/25 to 2026/27.

2 Approves the Internal Audit Work Plan 2024/25, 2025/26, 2026/27, including the detailed work plan for 2024/25.

1. Introduction

The Internal Audit Work Programme is updated each year. It notes the internal audits that will be performed during the upcoming financial year (2024/25) and potential audits to be performed in the subsequent two years. It is prepared via review of the BOPRC Key Risk Register, consideration of discussion during Risk and Assurance Committee meetings, and formal discussions with BOPRC’s Leadership Team.

The Internal Audit Work Programme has been presented to and endorsed by the Leadership Team. It now requires approval by the Risk and Assurance Committee to enable the internal audits for 2024/25 to be performed.

1.1 Alignment with Strategic Framework

The Way We Work

We continually seek opportunities to innovate and improve.

2. Proposed Internal Audit Work Plan to 2026/27

This Work Plan is a rolling three-year plan which is reviewed annually.

During 2024, Internal Audit undertook a planning process to refresh the Internal Audit Work Plan for the three years 2024/25 to 2026/27 (provided in Attachment 1).

A risk-based approach has continued to be used to assess the internal audit needs of the Bay of Plenty Regional Council and audit priorities.

The Audit Team held discussions with the Chief Executive, General Managers and selected Managers, reviewed prior plans and reviewed the ‘audit universe’ of other Councils.

The Internal Audit work programme for 2024/25 has been developed based on the level of resources currently available. This is one full time Principal Internal Auditor, and funding for consultancy services sufficient for two to three reviews – depending on scope. Note delivery of assurance services to Ōpōtiki District Council commenced in May 2024, and while charged on a cost-recovery basis (in accordance with the current BOPRC Fees and Charges policy), will assist in offsetting the cost of BOPRC’s Internal Audit function.

The proposed detailed work plan for 2024/25 is provided within the plan and is shown in the following table:

The Internal Audit Work Plan for the three years 2024/25 to 2026/27 has been given management approval by the Chief Executive and is now provided to the Risk and Assurance Committee for its review and approval.

3. Considerations

3.1 Risks and Mitigations

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

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

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

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

If the recommendation is adopted by Council, will it result in:

If the answer is ‘no’ to both questions please select the dropdown option 1 and complete appropriately.

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

4. Next Steps

Next Steps: What next? What resources are needed? Further analysis? Timeframes ahead. Any consultation planned. Remind Council of the process ahead. Next update to Council?

Conclusion: Short concluding remarks. Referring back to recommendations. No new content.

To approve the Internal Audit Work Plan as per the recommendations.

Attachments

Attachment 1 - BOPRC Internal Audit Work Plan FY2025-27 ⇩



Report To:	Risk and Assurance Committee
Meeting Date:	5 June 2024
Report Writer:	Aaron Huggins, Principal Internal Auditor
Report Authoriser:	Mat Taylor, General Manager, Corporate
Purpose:	To provide an update on the internal audit programme 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 March 2024 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 March 2024;

· Information on other relevant assurance reviews performed at BOPRC.

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 March 2024;

· Information on other relevant assurance reviews performed at BOPRC.

1.1 Alignment with Strategic Framework

The Way We Work

We continually seek opportunities to innovate and improve.

2. Internal Audit Work Plan 2023/24 Status

Based on the Internal Audit Work Plan 2023/24 the following table summarises the status of internal audit reviews for 2023/24.

Review	Field work	GM Sponsor	Status	Status of Internal Audit
Review	Field work	GM Sponsor	Status	Planning /Scope	Fieldwork	Draft Report	Mgmt Actions	Final Report
CDEM Administering Authority (2022/23)	BOPRC	Regulatory Services	Complete	Complete	Complete	Complete	Complete	Complete
External partner project management	BOPRC	Chief Executive	In Progress	In Progress (75%)
Focus Catchments	BOPRC	Integrated Catchments	In Progress	Complete	In Progress (25%)
Forecasting & budgeting	BOPRC	Corporate	Deferred to 2024/25
Freshwater management key risk mitigations	BOPRC	Strategy & Science	In Progress	Complete
Health & Safety	External	Corporate	In Progress	Complete	In Progress (10%)
Procurement	BOPRC	Corporate	In Progress	Complete	In Progress (90%)
Science management framework	BOPRC	Strategy & Science	In Progress	Complete	In Progress (25%)
Sensitive expenditure	BOPRC	Corporate	Complete	Complete	Complete	Complete	Complete	Complete

Delivery of the 2023/24 internal audit programme is largely progressing on schedule.

The CDEM Administering Authority review completed the FY22/23 work plan, and is presented in a separate paper along with the Sensitive Expenditure review (FY23/24).

An external provider has been appointed to perform the Health & Safety review, and is expected to perform the review during Q4 of FY24.

The Procurement review is nearing completion, with fieldwork almost complete.

The Forecasting & Budgeting audit has been deferred to FY24/25; this is due to resource constraints within the Finance Team due to LTP preparation.

3. Internal Audit Follow Up

Internal Audit has reviewed all open management actions as part of the follow up work in the 2023/24 Work Plan.

3.1 Management Actions

At the start of the quarter (1 January 2024) there were 72 open management actions.

The following graph highlights the progress made within BOPRC to address open audit actions during the quarter to 31 March 2024:

Figure 1 Open management actions (1 January 2024 vs 31 March 2024)

During the quarter nine actions were closed. The total of actions open as at 31 March 2024 is 62, the majority of these relate to ICT Security (19), Regional Pest Management Plan (13), and CDEM Administering Authority (newly added this quarter – 8).

Two actions are overdue (one each from Fraud Risk Assessment and Gravel Extraction); these are reported separately with the Completed Internal Audit Reviews paper.

3.2 Improvement Actions

At the start of the quarter (1 January 2024) there were fourteen 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 quarter to 31 March 2024:

Figure 2 Open improvement actions (1 January 2024 vs 31 March 2024)

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. Other Assurance Activity

4.1 Ōpōtiki District Council

Over the past year, the BOPRC Risk & Assurance Team have been working with Ōpōtiki District Council (ODC) to prepare their Internal Assurance Programme; this was presented to (and endorsed by) their Leadership Team in November 2023 and subsequently ratified by the ODC Risk and Assurance Committee.

As a result, BOPRC are conducting the inaugural assurance review (ODC Regulatory Services). Initial fieldwork was completed in early May 2024, and the report is expected to be finalised in June 2024 before being presented to ODC Risk and Assurance at the next applicable meeting.

The review is budgeted for 126 hours of BOPRC Risk & Assurance staff time, and is on-charged on a cost-recovery basis using applicable rates per the BOPRC Fees and Charges Policy. The overall service provision is covered by an Assurance Services Agreement (which sets out general Terms and Conditions, similar in nature to an Engagement Letter issued by a Professional Services Firm), and each assurance review is covered by an agreed Scope and accompanying Work Brief (costed per the applicable staff rates in the current BOPRC Fees & Charges Policy).

Assurance service provision is offered by BOPRC to enable ODC to establish and conduct their own Assurance Programme, within ODC’s fixed budgetary constraints.

4.2 BOPRC EDRMS replacement

BOPRC is currently undertaking a project to replace its current Electronic Data Records Management System (EDRMS) (from ‘Objective’ to Microsoft ‘Sharepoint’). Risk and Assurance Team members are providing risk management support to the Project Manager and leading the legislative compliance workstream for the project.

5. Considerations

5.1 Risks and Mitigations

No significant risks identified; matters presented in this report are of a procedural nature only.

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

No implications for Māori identified – procedural matters only.

5.4 Community Engagement

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

5.5 Financial Implications

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

6. Next Steps

To note the Internal Audit status update (as at 31 March 2024).