MISSION AND VALUES OF COUNCIL
"A Sustainable Community that is inclusive, attractive, healthy and pleasant to live in, that uses our land so as to preserve our history and environment, respects the rights and equality of our citizens and manages our future growth wisely."
AGENDA
FOR THE
Audit Committee Meeting
12 May 2015
OUR VISION
"A thriving and friendly community that recognises our history and embraces cultural diversity and economic opportunity, whilst nurturing our unique natural and built environment."
OUR MISSION
“To deliver affordable and quality Local Government services.”
CORE VALUES OF THE SHIRE
The core values that underpin the achievement of the
mission will be based on a strong customer service
focus and a positive attitude:
Communication
Integrity
Respect
Innovation
Transparency
Courtesy
DISCLAIMER
The purpose of Council Meetings is to discuss, and where possible, make resolutions about items appearing on the agenda. Whilst Council has the power to resolve such items and may in fact, appear to have done so at the meeting, no person should rely on or act on the basis of such decision or on any advice or information provided by a Member or Officer, or on the content of any discussion occurring, during the course of the meeting.
Persons should be aware that the provisions of the Local Government Act 1995 (Section 5.25 (e)) establish procedures for revocation or rescission of a Council decision. No person should rely on the decisions made by Council until formal advice of the Council decision is received by that person. The Shire of Broome expressly disclaims liability for any loss or damage suffered by any person as a result of relying on or acting on the basis of any resolution of Council, or any advice or information provided by a Member or Officer, or the content of any discussion occurring, during the course of the Council meeting.
Agenda – Audit Committee Meeting 12 May 2015 Page 3 of 4
SHIRE OF BROOME
Audit Committee Meeting
Tuesday 12 May 2015
INDEX – Agenda
3. Declarations Of Financial Interest / Impartiality
5.1 2014/2015 QUARTER 3 FINANCE AND COSTINGS REVIEW...
Agenda – Audit Committee Meeting 12 May 2015 Page 4 of 5
NOTICE OF MEETING
Dear Council Member,
The next Audit Committee of the Shire of Broome will be held on Tuesday, 12 May 2015 in the Council Chambers, Corner Weld and Haas Streets, Broome, commencing at 4:00.
Regards
K R DONOHOE
Chief Executive Officer
08/05/2015
Agenda – Audit Committee Meeting 12 May 2015 Page 5 of 6
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That the Minutes of the Audit Committee held on 10 February 2015 be confirmed as a true and accurate record of that meeting.
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Agenda – Audit Committee Meeting 12 May 2015 Page 6 of 7
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SUMMARY: The Audit Committee is requested to consider the results of the Quarter 3 Finance and Costing Review (FACR) of the Shire’s budget for the period ended 31 March 2015, including proposed budget amendments to 30 June 2015. |
BACKGROUND
Previous Considerations
Between 1 January and 31 March, a local government is to carry out a review of its annual budget for that year and this is to be submitted to the Council within 30 days of completion. This process was competed as part of the Quarter 2 Finance and Costing Review (FACR) and presented to the Audit Committee for consideration on 10 February 2015. Subsequently, a number of recommendations from the Audit Committee were presented to Council for consideration at the Ordinary Meeting of Council on 26 February 2015.
The Quarter 3 FACR process commenced on 20 April 2015 and Council’s Executive Management Group considered the results on Friday, 8 May 2015. The results of the FACR are now presented for the consideration of the Audit Committee. Following consideration, and recommendation from the Committee, the matter will be presented to Council.
COMMENT
The forecast financial position to 30 June 2015 was a $116k deficit following the mid-year budget review. In response to Council’s request that the CEO achieve budget normalisation at the end of the Q3 FACR meetings, the Executive scrutinised each account for savings and the proposed amendments are predicting an end of year surplus of $10k.
It should be noted that the Shire undertook an organisational restructure which has had a significant impact upon expenditure within salaries accounts. A reconciliation of the salaries accounts was undertaken to forecast the end of year impact of the restructure. This has resulted in some budget amendment recommendations to cover long service leave and excess annual leave payments, which have been offset by a proposed transfer from the Leave Reserve.
|
Gross Impact to 30 June 2015 |
Excess Annual Leave Value |
Long Service Leave Value |
Less LSL Reimbursement from Shires |
Total Qualified for Transfer from Leave Reserve |
Net Impact to 30 June 2015 |
|
$270,551.23 |
($33,608.61) |
($159,504.08) |
($8,687.02) |
($184,425.67) |
$68,751.52 |
The final forecast of all the amendments to salary accounts and the corresponding transfer from the Leave Reserve is a $68,752 deficit impact to the Shire of Broome.
It should also be noted that there has been a significant increase in the income for Rates, however this has been deemed as organisational savings and is being proposed as a transfer to reserve. However, it is recommended that some of the additional costs associated with the organisational restructure be offset by a portion of these funds. In addition, Due to the current economic climate the Shire of Broome has witnessed a decrease in building and development applications which has adversely affected the income from this function. It is recommended that a portion of the savings offset this loss.
The associated costs proposed to be offset by organisational savings are as follows:
· $68,752 in additional salary related costs;
· an additional $45,000 in relief staff necessary to cover key functions in finance;
· an additional $35,000 in recruitment and training costs;
· $50,000 decrease in planning fees
While the restructure is expected to have a positive impact on the Shire’s expenses in the future, it is not expected to become apparent until the 2015/2016 financial year.
A comprehensive list of accounts has been included for perusal by the Committee and summarised by Directorate, with comparison to previous FACRs conducted this financial year below:
|
FACR
Q1 |
FACR
Q2 |
FACR
Q3 |
YTD
Impact |
|||
|
Executive - Total |
(2,500) |
23,500 |
(9,700) |
11,300 |
||
|
Business Enterprise and Community Development - Total |
63,622 |
14,327 |
(92,500) |
(14,551) |
||
|
Corporate Services - Total |
0 |
0 |
0 |
0 |
||
|
Development Services - Total |
11,000 |
15,500 |
15,000 |
41,500 |
||
|
Engineering Services - Total |
(10,000) |
0 |
(39,088) |
(49,088) |
||
|
Other Agenda items not requiring a FACR Amendment |
0 |
207 |
0 |
207 |
||
|
|
|
|
62,122 |
53,534 |
(126,288) |
(10,632) |
CONSULTATION
Nil
STATUTORY ENVIRONMENT
Local Government (Financial Management) Regulation 1996
6.8. Expenditure from municipal fund not included in annual budget
1) A local government is not to incur expenditure from its municipal fund for an additional purpose except where the expenditure —
a) is incurred in a financial year before the adoption of the annual budget by the local government;
b) is authorised in advance by resolution*; or
c) is authorised in advance by the mayor or president in an emergency.
(1a in subsection (1) –
“additional purpose means a purpose for which no expenditure estimate is included in the local government’s annual budget.”)
POLICY IMPLICATIONS
Materiality in Financial Reporting Policy 2.1.1.
FINANCIAL IMPLICATIONS
The net result of the 3rd Quarter FACR estimates is a forecast surplus of $10,632 to 30 June 2015.
The Chief Executive Officer has identified that the Road Reserve balance is $1,178,637, which represents only a minimal contingency considering the road network and probable future leverage requirements within the growth centre development phase of Broome and recommends that organisational savings be allocated to this reserve.
STRATEGIC IMPLICATIONS
Our People Goal – Foster a community environment that is accessible, affordable, inclusive, healthy and safe:
Effective communication
Affordable services and initiatives to satisfy community need
Our Prosperity Goal – Create the means to enable local jobs creation and lifestyle affordability for the current and future population:
Affordable and equitable services and infrastructure
Our Organisation Goal – Continually enhance the Shire’s organisational capacity to service the needs of a growing community:
Sustainable and integrated strategic and operational plans
Responsible resource allocation
Improved systems, processes and compliance
VOTING REQUIREMENTS
Absolute Majority
|
The Audit Committee recommends that Council: 1. Receives the 3rd Quarter Finance and Costing Review Report for the period ended 31 March 2015; 2. Adopts the operating and capital budget amendment recommendations for the period ended 30 June 2015 as attached. 3. Approves the budget to transfer $344,250 of the remaining of organisational savings to Road Reserve. 4. Acknowledges that the Q3 FACR has achieved a predicted surplus of $10K to 30 June 2015. |
|
Quarter 3 Finance & Costing Review Report |
|
Item 5.1 - 2014/2015 QUARTER 3 FINANCE AND COSTINGS REVIEW |
Quarter 3 Finance & Costing Review Report |
Agenda – Audit Committee Meeting 12 May 2015 Page 19 of 20
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5.2 AUDIT REGULATION 17 IMPROVEMENT PLAN BIANNUAL PROGRESS REPORT - REVIEW OF THE APPROPRIATENESS AND EFFECTIVENESS OF SYSTEMS AND PROCESSES FOR RISK MANAGEMENT, INTERNAL CONTROL AND LEGISLATIVE COMPLIANCE LOCATION/ADDRESS: NIL APPLICANT: NIL FILE: ADM03 AUTHOR: Manager Human Resources CONTRIBUTOR/S: Manager Financial Services RESPONSIBLE OFFICER: Chief Executive Officer DISCLOSURE OF INTEREST: NIL DATE OF REPORT: 5 May 2015 |
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SUMMARY: The Audit Committee is presented with a report for review on the progress of the Audit Regulation 17 Improvement Plan which was adopted by Council at the Ordinary Meeting of Council held 27 November 2014. The Improvement Plan contains a list of actions identified by the auditors requiring actions to improve the appropriateness and effectiveness of the Shire of Broome’s systems and processes in regards to risk management, internal control and legislative compliance. The Audit Committee is required to review the attached updated improvement plan prepared by the newly established Audit Regulation 17 Technical Advisory Group on the progress of the plan, then report to Council on the result of the Audit Committee’s review. |
BACKGROUND
Previous Considerations
OMC 28 August 2014 Item 10.2
SMC 27 June 2014 Item 9.4.6
OMC 27 November 2014 Item 10.3
The functions of local government Audit Committees have been expanded under amendments gazetted in 2013 to the Local Government (Audit) Regulations 1996 (the Regulations) to include reviewing the appropriateness and effectiveness of a local government's systems and procedures in regard to risk management, internal control and legislative compliance.
Specifically, Audit Regulation 17 (Audit Reg 17) of the Regulations requires the Chief Executive Officer (CEO) to conduct a review and report the results to the Audit Committee on the effectiveness of the systems and procedures regarding risk management, internal control and legislative compliance. The Department’s Audit in Local Government Guideline No. 9 advises that the review can be undertaken either on an internal or external audit basis.
At the Ordinary Meeting of Council (OMC) held 28 August 2014, Council adopted the Audit Committee’s recommendation to engage an external auditor to comply with the requirements of the Regulations. UHY Haines Norton (UHYHN) was appointed as the audit firm to conduct the review.
The inaugural CEO’s report on the biennial Regulation 17 Review was presented to Council at the Ordinary Meeting of Council held 27 November 2014. The requirement to report biannually to the Audit Committee on the progress of the improvement plan is one of the actions listed within the plan.
COMMENT
Purpose
The purpose is to report on the improvement plan actions biannually to the Audit Committee in May and November after endorsement by Executive Management Group (EMG).
REGULATION 17 REVIEW
The Shire of Broome appointed an external auditor to conduct a third party review of organisational practices in accordance with updated legislation contained within Regulation 17 of the Regulations.
The ‘Regulation 17 Review’ audit produced a comprehensive “Improvement Plan” sanctioned into three main compliance areas;
§ Risk Management (RM)
§ Legislative Compliance (LC)
§ Internal Controls (IC)
A cumulative total of fifty-eight framework components and action items were identified to increase procedural and system effectiveness in accordance with legislative requirements.
The “Improvement Plan” provides the organisation with a comprehensive overview of business practices and continuous improvement methodologies that work towards increasing best practice standards across all Shire Directorates.
Please see attached “Regulation 17 Review Improvement Plan”
Technical Advisory Group
Following the “Regulation 17 Review” the Shire established an internal Technical Advisory Group (TAG). The TAG performs a vital role in the Shire’s ability to fulfil its governance and responsibilities in relation to reporting, internal control and structure, risk management systems, legislative requirements and ethics.
The TAG consists of key Shire personnel to appropriately oversee strategic and operational business requirements contained within the “Regulation 17 Review”. The intent for this group is to effectively communicate and implement objectives throughout the organisation.
The TAG meets monthly to review and update specific actions contained in the plan. Membership of the TAG is comprised of the following positions:
Director Corporate Services (Chair)
Manager Governance
Manager Financial Services
Manager Human Resources
Manager Health & Rangers
Manager Information Services
Manager Community Development
Manager Operations Engineering
Waste Coordinator
The TAG intends to retain a decentralised risk structure in order to ensure that should turnover arise within any one role the organisation’s compliance function and reporting is not adversely affected and instead drives business continuity.
As stated in the Terms of Reference, the primary goal of the TAG is to implement and maintain the appropriateness and effectiveness of the Shire of Broome’s systems and procedures in relation to risk management, legislative compliance and internal controls. The TAG will:
• Progress the implementation of risk management across the organisation and to monitor risk management practices.
• Maintain internal controls across the organisation and monitor adherence to internal controls practices.
• Progress the implementation of the legislative compliance framework.
IMPROVEMENT PLAN
“Improvement Plan” action items contained within the “Regulation 17 Review” are allocated to members within the TAG committee and prioritised in accordance with organisational need and capacity.
There are a number of actions that are partially complete or in progress full details are contained in the attachment.
The following action items have been completed in accordance with the “Regulation 17 Review”.
|
No |
Framework Component Improvements |
|
RM 201 |
Risk Matrix amended in accordance with ISO 31000 (international best practice standards) |
|
RM 3.1 |
Risk Management Working Group (Audit Reg 17 TAG) has been established and monthly meetings initiated |
|
RM3.2 |
Risk Agenda topic included on weekly EMG Agenda |
|
RM3.3 |
Records of inductions maintained on personnel files |
|
RM3.9 |
Business Operating Procedure for Hazard Reporting has been established. |
|
LC 2.4 |
Legislative Compliance Working Group (Audit Reg 17 TAG) has been established and monthly meetings initiated |
|
IC2.2 |
Internal Controls Working Group (Audit Reg 17 TAG) has been established and monthly meetings initiated |
The following action items have been progressed in accordance with the “Regulation 17 Review” pending Council consideration;
|
No. |
Framework Components |
|
RM1.2 |
DRAFT Policy Work Safety Health |
|
IC 1.1 |
DRAFT Policy Internal Control |
|
IC1.8 |
Policy 2.1.2 Investment of Surplus Funds |
The above documents are attached to this report for review and notation by the Audit Committee and subsequent recommendation to Council for adoption. These policies have been workshopped with the Audit Committee on 6 May 2015 with attendance from Councillors Campbell, Tracey and Male.
Policy 2.1.2 Investment of Surplus
Funds was identified as one of the actions requiring review for compliance with
Regulation 19C from the Local Government (Financial Management) Regulations
1996 (FMR). The document is submitted with deletions marked as struck
through and additions in red. Since the
Audit Committee workshop, clarification was sought from the review auditors on
the application of FMR 19C of which restricts local governments to
investing funds only with banks (authorised deposit taking institutions) and in
the form of cash, resulting further deletions in Policy 2.1.2 of any references
to securities, managed funds and credit risk ratings which are irrelevant under
the restrictions.
The TAG has identified next level priorities to include, but not limited to:
Risk Management
§ Re-development of the Risk Management Strategy and Framework.
§ Re-establishment of the risk register.
§ Contractor induction management.
§ Risk training.
A budget amendment of $24K has been proposed in the Quarter 3 Finance and Costing Review (FACR) to investigate and mitigate corporate risk under Regulation 17, to be funded from part of the Local Government Insurance Scheme bonus received this year.
Legislative Compliance
§ Develop Policy to support legislative compliance
§ Investigate and develop a Shire of Broome Legislative Compliance Framework
§ Develop a Legislative Compliance Register
§ Develop Legislative Compliance Strategy
Internal Controls
§ Develop Bank Signatures Business Operating Procedure
§ Develop Cash Handling Business Operating Procedure
§ The Improvement Plan is to identify gaps based on risk with insurance identified as a priority.
The Shire of Broome strategic future planning for risk and internal and external compliance requirements will focus on Business Continuity Planning which promotes a self reliable sustainable system that enables Shire operations to continue within existing resources in the event of major change or emergency.
Some of the actions require analysis for levels of appropriateness specific to the Shire of Broome’s operational and strategic circumstances. In other cases, a staged approach may be required with the view to continuous review, reporting and improvement to achieve best practice outcomes for specific actions. The objective of this overall process is to ensure systems and procedures are in place that allow the Shire of Broome to achieve its strategic objectives for the benefit of public value, in the most effective and efficient way possible in line with the Shire’s Mission, "To deliver affordable and quality Local Government services."
This report recommends the review of the attached updated “Improvement Plan” prepared by the newly established Audit Regulation 17 Technical Advisory Group on the progress of the plan with amended timeframes and responsible officers, then report to Council on the result of the Audit Committee’s review, inclusive of any items or amendments for the CEO to action.
CONSULTATION
UHY Haines Norton
Chamber of Commerce and Industry
STATUTORY ENVIRONMENT
Local Government (Audit) Regulations 1996
16. Audit committee, functions of
An audit committee —
(a) is to provide guidance and assistance to the local government —
(i) as to the carrying out of its functions in relation to audits carried out under Part 7 of the Act; and
(ii) as to the development of a process to be used to select and appoint a person to be an auditor;
and
(b) may provide guidance and assistance to the local government as to —
(i) matters to be audited; and
(ii) the scope of audits; and
(iii) its functions under Part 6 of the Act; and
(iv) the carrying out of its functions relating to other audits and other matters related to financial management; and
(c) is to review a report given to it by the CEO under regulation 17(3) (the CEO’s report) and is to —
(i) report to the council the results of that review; and
(ii) give a copy of the CEO’s report to the council.
17. CEO to review certain systems and procedures
(1) The CEO is to review the appropriateness and effectiveness of a local government’s systems and procedures in relation to —
(a) risk management; and
(b) internal control; and
(c) legislative compliance.
(2) The review may relate to any or all of the matters referred to in subregulation (1)(a), (b) and (c), but each of those matters is to be the subject of a review at least once every 2 calendar years.
(3) The CEO is to report to the audit committee the results of that review.
POLICY IMPLICATIONS
2.1.2 Investment of Surplus Funds
FINANCIAL IMPLICATIONS
A budget amendment of $24K has been proposed in the Quarter 3 Finance and Costing Review (FACR) to investigate and mitigate corporate risk under Regulation 17, to be funded from part of the Local Government Insurance Scheme bonus received this year.
STRATEGIC IMPLICATIONS
Our People Goal – Foster a community environment that is accessible, affordable, inclusive, healthy and safe:
Effective communication
Affordable services and initiatives to satisfy community need
Accessible and safe community spaces
A healthy and safe environment
Our Prosperity Goal – Create the means to enable local jobs creation and lifestyle affordability for the current and future population:
Affordable and equitable services and infrastructure
Our Organisation Goal – Continually enhance the Shire’s organisational capacity to service the needs of a growing community:
An organisational culture that strives for service excellence
Sustainable and integrated strategic and operational plans
Responsible resource allocation
Effective community engagement
Retention and attraction of staff
Improved systems, processes and compliance
VOTING REQUIREMENTS
Simple Majority
|
The Audit Committee recommends that Council: 1. Receives the Audit Regulation 17 progress report and attached updated Improvement Action Plan. 2. Adopts the reviewed actions, timelines and responsible officers as detailed in the Improvement Action Plan. 3. Adopts the proposed policies as attached: (a) Work Safety Health Policy (b) Internal Control (Governance and Internal Controls) Policy 4. Adopts the reviewed Policy 2.1.2 Investment of Surplus Funds as attached. |
|
Audit Reg 17 Improvement Action Plan |
|
|
Policy 2.1.2 Investment of Surplus Funds REVIEWED |
|
|
DRAFT Work Safety Health Policy |
|
|
DRAFT Internal Control Policy |
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Item 5.2 - AUDIT REGULATION 17 IMPROVEMENT PLAN BIANNUAL PROGRESS REPORT - REVIEW OF THE APPROPRIATENESS AND EFFECTIVENESS OF SYSTEMS AND PROCESSES FOR RISK MANAGEMENT, INTERNAL CONTROL AND LEGISLATIVE COMPLIANCE |
Audit Reg 17 Improvement Action Plan |
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Appendix E |
|
RISK MANAGEMENT IMPROVEMENT PLAN |
|
|||||||||||
|
No. |
FRAMEWORK COMPONENTS |
PURPOSE/GOAL |
IMPROVEMENTS |
Officer |
Timing |
Comments |
|
|||||
|
RM 1.0 Mandate and Commitment |
|
|||||||||||
|
RM 1.1 |
Council Policy 1.2.11 Risk Management Policy |
To create an environment where Council, management and staff apply risk management, techniques through consistent and effective risk management practices. |
That relevant identified risks be included within
Council agenda items. |
Director Corporate Services
Manager Human Resources |
May 2015
May 2015 |
Updated with risk subheading for implementation in May 2015 OMC
MHR to review and report back to TAG with proposal |
|
|||||
|
RM 1.2 |
Occupational Safety and Health Policy |
To create an environment where Council, management and staff comply with Occupational Safety and Health requirements for Employees, Contractors, Volunteers and visitors |
That a risk based Occupational Safety and Health Policy be developed. |
Manager Human Resources |
May 2015
|
Draft policy has been circulated for review internally via the Audit Reg 17 TAG, OSH Committee and CEO. To be presented at a workshop with the Audit Committee 6th May. |
|
|||||
|
RM 2.0 Design of Framework for Managing Risk |
|
|||||||||||
|
RM 2.1 |
Enterprise-wide Risk Management Strategy and Framework |
Defines and details the various practices to support Risk Management and establishes the risk management strategy and framework to be followed by all Shire staff. |
That the Enterprise-wide Risk Management Strategy and Framework be made available to users of the Intranet.
That the current risk matrix be amended to facilitate risks to be assessed within the context of the objective (in accordance with ISO 31000) and to use a percentage for relevant thresholds rather than the present fixed dollar thresholds. |
Manager Human Resources
Executive Officer |
December 2014 November 2015
December 2014 |
The draft document has been identified and will be reviewed for presentation to the Audit Committee Nov 2015
Completed |
|
|||||
|
RM 2.2 |
Insurance Strategy or Policy |
A policy to provide guidance to Officers as to the management of risk through insurance. |
That an Insurance Strategy and Policy be developed to provide clarity on issues such as the level of self-insurance, the adequacy of cover and the basis of the valuation of the insured assets. |
Director Corporate Services |
November 2015 |
Draft document to be developed for presentation to the Audit Committee Nov 2015
|
|
|||||
|
RM 3.0 Implementing risk management |
|
|||||||||||
|
RM 3.1 |
Risk Management Working Group |
A working group to progress the implementation of risk management across the organisation and to monitor risk management practices. |
That a working group be established and maintained to progress and oversee the implementation of the Enterprise-wide Risk Management Strategy and Framework. |
Manager Financial Services |
June 2015 |
Complete – TAG formed March 2015 |
|
|||||
|
RM 3.2 |
Executive Management Group |
An effective Executive Management Group charged with implementation of Council policies. |
That risks are regularly documented and monitored by the EMG in line with the RM Strategy and Framework and risk treatments are identified for events classified as high risk. |
EMG |
Ongoing |
Risk is a discussion on the weekly EMG agenda. |
|
|||||
|
RM 3.3 |
Staff Induction |
To ensure new staff are aware of their obligations to be aware of risk management, the OSH risks and their obligation to report breaches of controls and other risk related incidences. |
That long term employees be the subject of a re-induction process to ensure they are aware of changes to risk management and OSH risks procedures since their initial induction.
|
Manager Human Resources
Manager Human Resources |
September Annually
December 2014 |
To be rolled out initially September 2015
Currently conducted. |
|
|||||
RISK MANAGEMENT IMPROVEMENT PLAN |
||||||||||||
|
No. |
FRAMEWORK COMPONENTS |
PURPOSE/GOAL |
IMPROVEMENTS |
Officer |
Timing |
Comments |
||||||
|
RM 3.0 Implementing risk management (Continued) |
||||||||||||
|
RM 3.4 |
OSH Committee |
A working committee is established to implement OSH strategy and procedures. |
That a risk based assessment of OSH issues be undertaken by the working committee and included within minutes to enable prioritisation of risk treatments. |
|
|
Query – To be deleted, Council has a working OHS Committee already established and can undertake this improvement
OSH Committee is in existence. Risk tables are included in the hazard identification procedures effective March 2015. |
||||||
|
RM 3.5 |
Shire of Broome Business Continuity Plan |
To plan for the prevention, response and recovery from events that may threaten the capacity of the Shire of Broome to continue to provide services and good governance to the District. |
That, as high priority, an effective documented Business Continuity Plan be developed including relevant disaster recovery plans.
That, once adopted, the Plan’s effectiveness be tested. |
Director Corporate Services
Director Corporate Services |
October 2015
November 2015 |
|
||||||
|
RM 3.6 |
Local Emergency Management Plan 2014 Draft |
A plan is prepared in accordance with the requirements of Emergency Management Act 2005 [s.41(4)] and State Emergency Management Policy 2.5 |
That, the draft plan be finalised and once adopted, its effectiveness be tested in accordance with PART 5 of the plan. |
Director Development Services |
Complete – Oct 2014
June 2015 |
Plan has been finalised and adopted since the date of this report.
Testing of the plan to be complete by June 2015 subject to funding |
||||||
|
RM 3.7 |
Local Recovery Plan 2014 Draft |
A plan is prepared in accordance with the requirements of Emergency Management Act 2005 [s.41(4)] and State Emergency Management Policy 2.5 |
That, the draft plan be finalised and once adopted, its effectiveness be tested. |
Director Development Services |
Complete – Oct 2014
June 2015 |
Plan has been finalised and adopted since the date of this report.
Testing of the plan to be complete by June 2015 subject to funding |
||||||
|
RM 3.8 |
Records Disaster Management Plan |
A plan is prepared to minimise the risk of loss of records in the event of a disaster. |
That the Plan be amended to: - Consider risks in accordance with Risk Management Policy and the associated Strategy and Framework. - Provide for the timely electronic storing of all records. - Require electronic records to be routinely backed up and stored at sufficiently remote geographic location to reduce the risk of the impact of a common disaster event. - Require routine testing to ensure currency and completeness of restored backups. |
Manager Information Services |
Complete
Complete
February 2015 May 2015
April 2015 |
In progress
Complete – currently conducted.
|
||||||
|
RM 3.9 |
Business Operating Procedure 010 Hazard, Accident and Incident Reporting |
A management procedures designed to guide staff on the actions required when a hazard is identified or an incident reported. |
That the procedure be amended to: - Clearly state that liability should not be admitted; - Provide clarity as to who contractors, temporary personnel, service personnel and volunteers should report incidents or hazards to; and - Implement controls to ensure procedure is followed at all times, in particular ensuring relevant evidence is obtained on a timely basis. |
Manager Human Resources |
December 2014 |
Complete March 2015 |
||||||
|
RM 3.10 |
Business Operating Procedure 2.020 Contractor Management (Risk and Safety) |
A management procedures designed to ensure a safe working environment at all Shire premises. |
That controls be implemented to ensure procedure is followed and to maintain evidence of compliance with procedure. |
Manager Human Resources |
November 2015 |
MHR to circulate current procedures to the TAG for review with a view to decentralise responsibility to ROs with respective contract management. |
||||||
|
RM 3.11 |
Business Operating Procedure 2.008 Vital Records Management |
A management procedures designed to guide staff on the actions required to manage vital records. |
That the procedure be amended to: - Clarify the vital records to be held in the Fire Proof Safe; - Ensure all staff complete a vital records access form; - Provide for vital records to be returned daily to records to ensure overnight security. |
Manager Information Services |
Complete Complete December 2014 |
Process to be reviewed with potential for staff to access a copy only. |
||||||
|
RM 3.12 |
Emergency Response Procedures – Shire Buildings |
To ensure uniformity in the handling of building related emergency situations. |
That emergency response procedures for all Shire buildings be developed and implemented. |
Manager Health Rangers/ Manager Community Development |
October 2015 |
Review required prior to 2015/2016 cyclone season.
BRAC/Civic Centre/Library – Propose amending existing procedures to be consistent with those developed. |
||||||
|
RM 3.14 |
Events risk assessment |
To require a risk assessment to be undertaken as part of the hosting of community events on Shire property. |
That a standardised risk management plan for completion by event hosts and review by senior officers be developed. |
Manager Community Development/Events Coordinator |
Complete
August 2015 |
Large scale events are required to provide an audited Risk management plan.
Standardised risk management plan template to be developed as part of event review process. |
||||||
|
RM 3.15 |
Asset Management Risk Assessment |
Inclusion of a risk assessment undertaken as part of development and maintenance of the Shire of Broome Asset Management Plans 2013 (AMP) |
That treatment plans be monitored to ensure risks are reduced to a medium level. |
Asset Coordinator |
June 2016 |
A risk assessment to be included when reviewing existing Asset Management Plans and developing new Asset Management Plans. |
||||||
|
RM 3.16 |
Workforce Risk Assessment |
Inclusion of a risk assessment undertaken as part of development and maintenance of the Shire of Broome Workforce Plan 2013 |
That a treatment plan for all identified extreme and high risks be included in the Plan to reduce the identified risks. |
Manager Human Resources |
April 2015 |
|
||||||
|
RM 3.17 |
Project Specific Risk Assessments |
A risk assessment is undertaken as part of a major project brief. A major project is defined in Management Policy. |
That procedures be developed to ensure risk assessments are undertaken in accordance with risk strategy and framework prior to their approval. |
Manager Financial Services |
December 2015 |
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RM 4.0 Monitoring and review |
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RM 4.14 |
Audit and Risk Committee |
An Audit Committee is required by the Local Government (Audit) Regulations 1996, and its composition and role is prescribed. |
That the Committee receive bi-annual reports containing information on extreme and high risk ratings in accordance with the Enterprise-wide Risk Management Strategy and Framework. |
Manager Human Resources |
April/November Annually |
Pending review of the risk register. This is to be included in the bi-annual report on risk to the Audit Committee. |
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RM 4.15 |
Monitoring Compliance |
To ensure policies relating to risk management are adhered to by the organisation and their effectiveness is monitored. |
That recording and reporting mechanisms to monitor risks be implemented in accordance with policy. |
Manager Human Resources |
Pending |
Dependant on review of Risk Management Policy |
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RM 4.16 |
Entity Risk Register |
To achieve a risk management tool to record the risk management processes for the overall organisation. |
That the entity risk register as outlined in the Enterprise wide risk management Strategy and Framework be maintained. |
Manager Human Resources |
Ongoing |
Under review. |
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RM 4.17 |
Occupational Safety and Health (OSH) Register |
To maintain a hazard based register of OSH matters. |
That the current outstanding OSH list be augmented by an OSH register capable of provide regular reports and identifying OSH trends. |
Manager Human Resources |
Ongoing |
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RM 5.0 Continual improvement of the framework |
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RM 5.1 |
Ongoing Improvement Program |
A program developed to plan and implement improvements in risk management practices and to guide the process of implementation. |
That a risk management improvement plan be maintained into the future to support the process of continual improvement. |
Audit Reg 17 TAG |
Ongoing |
This improvement plan forms the basis of an all inclusive continual improvement process for all three areas. |
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RM 5.2 |
Training |
Structured risk management training be available for elected members and senior staff. |
That risk management training be available to elected members and all senior staff undergo relevant risk management training. |
Manager Human Resources |
November - Annually |
Included in LGIS membership. |
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LEGISLATIVE COMPLIANCE FRAMEWORK REVIEW
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Legislative Compliance Improvement Plan |
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No. |
FRAMEWORK COMPONENTS |
PURPOSE/GOAL |
IMPROVEMENTS |
OFFICER |
TIMING |
COMMENTS |
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LC 1.0 Mandate and Commitment to Legislative Compliance |
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LC 1.1 |
Council Policy – Legislative Compliance Policy |
To evidence the Council’s commitment to legislative compliance and its importance to the organisation. |
That a policy to support legislative compliance be developed. |
Manager Governance |
November 2015 |
Draft document to be developed for presentation to the Audit Committee Nov 2015
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LC 1.2 |
Council Policy 1.2.10 Records Management. |
To incorporate legislative requirements and standards into the record keeping functions. |
That the Records Management procedures and inductions be reviewed to improve the effectiveness of the records management systems. |
All Staff
Manager Information Services |
Ongoing
February 2015
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Further training to be scheduled |
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LC 2.0 Design of Framework for Legislative Compliance |
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LC 2.1 |
Management framework -Legislative Compliance |
To establish the Legislative Compliance Framework, systems and controls and detail various practices to support legislative compliance. |
That a compliance framework reflecting a risk based approach to legislative compliance be developed, detailing the monitoring and reporting systems to be utilised. |
Manager
Governance/ |
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Draft document to be developed for presentation to the Audit Committee Nov 2015
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LC 2.4 |
Risk Management Working Group |
To established a legislative compliance working group to progress the implementation of the framework. |
That a working group be established to progress the implementation of a Legislative Compliance Framework. |
Technical Advisory Group (TAG) |
Complete |
TAG established March 2015 to address all subject areas. |
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LC 3.0 Senior Management Commitment |
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LC 3.2 |
Communications |
To ensure staff, contractors and regular volunteers are aware of their obligation to report breaches of legislation to the appropriate Officer. |
That the obligation to report compliance breaches be communicated to contractors and volunteers. |
Audit Reg 17 TAG |
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To be confirmed to be included in the contractor induction process. |
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LC 4.0 Staff Experience and Training |
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LC 4.1 |
Experienced Staff |
To ensure staff engaged at a senior level and on technical roles have an understanding of the legislative requirements relevant to their role. |
That actions continue to address staff recruitment issues with the goal of improving the effectiveness of recruiting appropriately qualified and experienced staff. |
CEO/Manager Human Resources |
Ongoing |
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LC 4.0 Staff Experience and Training (Continued) |
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LC 4.2 |
Staff Training |
To ensure the staff have access to ongoing and appropriate training in legislative requirements. |
That a risk based training matrix be developed identifying and addressing training needs as part of a broader workforce plan. |
Manager Human Resources |
April 2015 |
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LC 5.0 Monitoring and Review of Legislative Compliance |
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Duplicated with RM4.14 |
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LC 5.2 |
Legislative Compliance Register |
A
legislative compliance register to record known breaches of legislation. |
That a legislative compliance register be developed as part of a legislative compliance framework. |
Manager Governance |
November 2015 |
Draft document to be developed for presentation to the Audit Committee Nov 2015
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LC 5.4 |
Monitoring Compliance |
To ensure policies and other controls relating to legislative compliance are adhered to and their effectiveness is monitored. |
That monitoring and reporting procedures for legislative compliance be developed as part of Legislative Compliance Strategy. |
Manager Governance |
November 2015 |
Draft document to be developed for presentation to the Audit Committee Nov 2015
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LC 6.0 Continual Improvement of Legislative Compliance |
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LC 6.1 |
Ongoing Improvement Program |
A program developed to plan and implement improvements in legislative compliance practices and to guide implementation. |
That the improvement program contained within this report be used as an initial improvement program. |
Audit Reg 17 TAG |
Ongoing |
This improvement plan forms the basis of an all inclusive continual improvement process for all three areas. |
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INTERNAL CONTROLS ENVIRONMENT AND FRAMEWORK REVIEW
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INTERNAL CONTROLS IMPROVEMENT PLAN |
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No. |
FRAMEWORK COMPONENTS |
PURPOSE/GOAL |
IMPROVEMENTS |
OFFICER |
TIMING |
COMMENTS |
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IC 1.0 Mandate and Commitment to Internal Controls |
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IC 1.1 |
Council Policy Internal Controls Policy |
To evidence the Councils commitment to Internal Controls and their importance to the Organisation. |
That a policy be developed reflecting Council’s commitment to a risk based internal controls throughout the organisation. |
Manager Financial Services |
May 2015 |
Presented to Audit Committee workshop 6th May for adoption by AC to the May OMC. |
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IC 1.7 |
Council Policy 2.1.1 Materiality in Financial Reporting |
To establish the Council’s view on when variances in financial reports are considered material. |
That the policy wording be reviewed to provide additional clarity. |
Manager Financial Services |
June 2015 |
To be reviewed as part of the annual budget adoption 15/16 in June. |
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IC 1.8 |
Council Policy 2.1.2 Investment of Surplus Funds |
To establish the Council’s view on how surplus funds should be invested. |
That the policy be reviewed to ensure compliance with Regulations 19C of the LG Financial Management Regulations. |
Manager Financial Services |
May 2015 |
Presented to Audit Committee workshop 6th May for adoption by AC to the May OMC. |
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IC 2.0 Internal Control Framework Design |
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IC 2.2 |
Internal Controls Working Group |
A working group to maintain internal controls across the Organisation and monitor adherence to internal controls practices. |
That action be taken, as a high priority, to establish a working group to address inter- departmental internal controls. |
TAG |
Complete |
TAG established March 2015 to address all subject areas. |
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IC 2.3 |
Management Policy - Internal Controls |
To establish a risk based Internal Control Framework, Systems and practices to support the internal control environment. |
That an internal control framework be developed reflecting a risk based approach to internal controls and providing the monitoring and reporting systems. |
TAG |
October 2015
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Business Operating Procedure presented to Audit Committee workshop 6th May for notation by AC. Framework requirement to be discussed and reviewed with the TAG. |
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No. |
PROCESS CONTROL |
PURPOSE OF CONTROL |
IMPROVEMENTS |
OFFICER |
TIMING |
COMMENTS |
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IC 3.0 Implementation of Internal Controls |
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IC 3.5 |
Human Resources Directive HR 003 – Police Checks for Certain staff |
To reduce the risk of theft, fraud, dishonesty or criminal damage by an employee. |
That as a matter of high priority, Police checks be required for all relevant staff and controls be established to ensure the directive is followed at all times. |
Manager Human Resources |
Ongoing |
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IC 3.6 |
Experienced Staff |
To ensure all senior staff have an understanding of the inherent risks internal controls are addressing associated with, and relevant to, their role. |
Refer to LC 5.1 |
Manager Financial Services |
November 2014 - Ongoing |
To be implemented as part of the Internal Control Policy & BoP through all employees. |
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IC 3.7 |
Staff Training |
To ensure the staff have access to ongoing training in internal controls and attend appropriate training sessions. |
Refer to LC 5.2 |
Manager Governance/Manager Financial Services |
Ongoing |
Inductions and specific on the job training for internal control areas ie cash handling, stock control as required. Training programmes to be developed for specific areas eg BRAC, Civic Centre and others as identified. |
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IC 4.0 Monitoring and Review of Internal Controls |
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IC 4.1 |
Audit Committee |
An Audit Committee is required by the Local Government (Audit) Regulations 1996, and its composition and role is prescribed. |
No action currently required. The continued growth of Shire may require routine internal audit reporting to be a future consideration. |
Chief Executive Officer |
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Noted |
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IC 4.3 |
Monitoring |
To ensure policies and other controls relating to internal controls are adhered to within the organisation and their effectiveness is monitored. |
That an internal audit function be developed to monitor the appropriateness and effectiveness of financial and non-financial internal controls. |
Audit Reg 17 TAG |
November -Annually |
Monitoring processes to be developed. |
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IC 4.4 |
Breach monitoring |
To ensure a process exists to track breaches of internal controls and effectiveness of changes to internal controls. |
That a process to track control breaches be developed as part of the wider risk management process. |
Audit Reg 17 TAG |
Ongoing |
Monitoring processes to be developed. |
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IC 5.0 Continual Improvement of Internal Controls |
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IC 5.1 |
Ongoing Improvement Program |
A program developed to plan and implement improvements in internal controls practices and to guide the process of implementation. |
That a documented program to implement improvements to internal controls be established as part of the wider risk management process. |
Audit Reg 17 TAG |
Ongoing |
This improvement plan forms the basis of an all inclusive continual improvement process for all three areas. |
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IC 6.0 |
INTERNAL CONTROL WEAKNESSES IMPROVEMENT PLAN |
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IC 6.1 |
BRAC Receipting |
To ensure that all funds received at the BRAC are receipted to the correct account in a timely manner. |
That documented control procedures be developed and compliance with these procedures monitored. |
Manager Financial Services/Manager Community Development |
Complete and on-going
In progress – December 2015 |
Procedures documented and monitored by BRAC Manager.
LINKS training identified as a requirement and submitted to MHR for 2015/16 FY. |
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IC 6.2 |
Civic Centre Receipting |
To ensure all funds received at the Civic Centre are receipted to the correct account in a timely manner. |
That documented control procedures be developed and compliance with these procedures monitored. |
Manager Financial Services/Manager Community Development |
Complete
In progress – July 2015 |
Staff manual developed that includes stock take procedures.
Awaiting cash handling procedure to be developed |
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IC 6.3 |
Waste Facility Receipting |
To ensure all funds received at the Waste Facility are receipted to the correct account in a timely manner. |
That documented control procedures be developed and compliance with these procedures monitored. |
Waste Coordinator/Manager Financial Services |
In progress – January 2015
November 2015 |
All banking now done each weekday.
Formal procedures and compliance checks to be developed. |
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IC 6.4 |
Other Receipting |
To ensure all funds received at any other place are receipted to the correct account in a timely manner. |
That a BOP be developed to control the authorised receipting points and establish processes to ensure appropriate controls at new, or ad hoc, points. |
Manager Financial Services |
November 2015 |
Halted due to staff resignation. Business Operating Procedure to be developed once Revenue Officer is on board. |
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IC 6.5 |
Refuse/TIP Dockets |
To ensure debtor invoices are raised monthly for operators with a debtor account. |
That control procedures be improved to ensure all dockets are received and invoiced. |
Manager Financial Services |
Complete |
Tip dockets were in the process of transitioning to the Mandalay electronic system – this item can be deleted?
Mandalay software ensures all transactions are recorded and those allocated to debtor accounts are invoiced monthly – Waste Coordinator |
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IC 6.6 |
Bank Account Signatories |
To ensure only properly authorised, competent staff are signatories to Bank Accounts. |
That a Policy be developed to document the process for addition or removal of signatories from Shire bank accounts. |
Manager Financial Services |
November 2015 |
Halted due to staff resignation. Business Operating Procedure to be developed once Revenue Officer is on board. |
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IC 6.7 |
Separation of duties |
Separation of debtors and creditors roles to minimise the risk of fraud. |
That system controls be implemented to ensure debtor and creditor staff do not have cross access. |
Manager Financial Services |
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Query – Finance have adequate controls to ensure fraud risk is minimise. This is not required as an improvement |
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IC 6.8 |
Accounting Control Procedures |
To ensure all financial transactions are appropriately recorded/ reported and the risk of fraud or error is minimised. |
That the accounting procedures be expanded to more fully describe the task and its associated consequences and lines of authority. |
Financial Services Team |
June 2015 |
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Highlighted Text: To be queried further with auditors
Financeial
Section Services
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TITLE: |
INVESTMENT OF SURPLUS FUNDS |
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ADOPTED: |
OCM 6 October 2005 - Pages 75 – 76 |
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REVIEWED: |
OMC 15 March 2012 – Pages 96 – 103 OMC 14 June 2012 – Pages 140 – 142 OMC 27 March 2014 – Pages 94 - 99 |
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ASSOCIATED LEGISLATION: |
Local Government Act 1995 Local Government (Financial Management) Regulations 1996 Trustees Act 1962 Australian Accounting Standards |
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ASSOCIATED DOCUMENTS: |
Issue Credit Rating Definitions (attached) |
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REVIEW RESPONSIBILITY: |
Manager Financial Services |
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DELEGATION: |
Investment of Surplus Funds |
Previous Policy Number – 2.1.5
Objective:
To invest Council’s surplus funds in a prudent manner, with consideration of risk and at the most favourable rate of interest available to it at the time, for that investment type, while ensuring that its liquidity requirements are being met.
While exercising the power to invest, consideration is to be given in preservation of capital, liquidity, and the return of investment.
· Preservation of capital is the principal objective of the investment portfolio. Investments are to be performed in a manner that seeks to ensure security and safeguarding the investment portfolio. This includes managing credit and interest rate risk within identified thresholds and parameters.
· The investment portfolio will ensure there is sufficient liquidity to meet all reasonably anticipated cash flow requirements, as and when they fall due, without incurring significant costs due to the unanticipated sale of an investment.
· The investment is expected to achieve a predetermined market average rate of return that takes into account the Council’s risk tolerance. Any additional return target set by Council will also consider the risk limitation and prudent investment principles.
Delegation of Authority:
Authority for implementation of the Investment Policy is delegated by Council to the Chief Executive Officer (CEO) in accordance with the Local Government Act 1995. The CEO may in turn delegate the day-today management of Council’s Investment to senior staff subject to regular reviews.
Prudent Person Standard:
The investment will be managed with the care, diligence and skill that a prudent person would exercise. Officers are to manage the investment portfolios to safeguard the portfolios in accordance with the spirit of this Investment Policy, and not for speculative purposes.
Policy:
Council and staff have an obligation to ensure that surplus funds are invested in a responsible manner.
Council is required to have in place a current set of policies and internal control procedures that satisfy the responsibilities under Section 6.14 of the Local Government Act 1995, Part III of the Trustees Act 1962 (as amended) and Regulation 19C of the Local Government (Financial Management) Regulations 1996.
Council will adopt a conservative investment approach to ensure investment capital is preserved and funds are always available in the short term. Council and delegated officers have a fiduciary duty under the Local Government Act 1995, therefore risks must be kept to an acceptable minimum, particularly credit risk.
Reporting and Review
A monthly report will be provided to Council in support of the monthly statement of financial activity. The report will detail the investment portfolio in terms of performance, percentage exposure of total portfolio, maturity date and changes in market value.
Guidelines Regulation 19C
The Chief Executive Officer and delegated officers are authorised to invest surplus funds within the authorised investment parameters and regulation 19C of the Local Government (Financial Management) Regulations 1996.
1. Authorised Investments
1.1 Cash/
Bank Deposits/ Securities
(a) Deposits with an authorised deposit-taking institution as defined in the Banking Act 1959 (Commonwealth) section5; or
(b) The
Western Australian Treasury Corporation established by the Western
Australian Treasury Corporation Act 1986; and
1.2 Restrictions
(a) Council must not deposit with an institution that is not an authorised institution;
(b) Deposit for a fixed term not more than 12 months;
(c) Not invest in bonds that are not guaranteed by the Commonwealth Government, or a State or Territory Government;
(d) Not invest in bonds with a term to maturity of more than 3 years;
(e) Not invest in foreign currency;
(f) Organisations
with which deposits are placed must have credit ratings equivalent to or higher
than the Authorised Investment Services Provider and Exposure limits table at 2
below;
(g) The
interest rate re-set period on floating rate notes must be less than or equal
to 6 months. Term of the notes must not exceed 3 years.
(h) Managed
Fund investments are restricted by average duration of less than 3 years.
(i) Maximum
limits (% of investment portfolio) are detailed in the Authorised Investment
Services Provider and Exposure limits Table at 2 below.
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Note – 1. The
maximum exposure % is the % of the total Current Cash Assets that can be
invested.
2. All
ratings above are those set by Standard and Poor's Rating Services, equivalent
Finch ratings are also acceptable.
3. All
other investments require Council approval.
Issue Credit Rating Definitions (taken from Standard & Poor's
website
(www.standard-poors.com/ratings/definitions/issues
A Standard & Poor's issue
credit rating is a current opinion of the creditworthiness of an obligor with
respect to a specific financial obligation, a specific class of financial
obligations, or a specific financial program (including ratings on medium term
not programs and commercial paper programs). It takes into consideration
the creditworthiness of guarantors, insurers, or other forms of credit enhancement
on the obligation and takes into account the currency in which the obligation
is denominated. The issue credit rating is not a recommendation to
purchase, sell, or hold a financial obligation, inasmuch as it does not comment
as to market price or suitability for a particular investor.
Issue credit ratings are based on
current information furnished by the obligors or obtained by Standard &
Poor's form other sources it considers reliable. Standard & Poor's
does not perform an audit in connection with any credit rating and may, on
occasion, rely on unaudited financial information. Credit ratings may be
changed, suspended, or withdrawn as a result of changes in, or unavailability
of, such information, or based on other circumstances.
Long-Term
Issue Credit Ratings
Issue credit ratings are base, in
varying degrees, on the following considerations:
1. Likelihood
of payment – capacity and willingness of the obligor to meet its
financial commitment on an obligation in accordance with the terms of the
obligation:
2. Nature
of and provisions of the obligation:
3. Protection
afforded by, and relative position of, the obligation in the event of
bankruptcy, reorganisation, or other arrangement under the laws of bankruptcy
and other laws affecting creditors' rights.
The issue of rating definitions
are expressed in terms of default risk. As such, they pertain to senior
obligations to an entity. Junior obligations are typically rated lower
than senior obligations, to reflect the lower priority in bankruptcy, as noted
above. (Such differentiation applies when an entity has both senior and
subordinated obligations, secured and unsecured obligations, or operating
company and holding company obligations.) Accordingly, in the case of
junior debt, the rating may not conform exactly within the category definition.
AAA
An obligation rated
"AAA" has the highest rating assigned by Standard & Poor's.
The obligor's capacity to meet its financial commitment on the obligation is
extremely strong.
AA
An obligation rated "AA"
is somewhat more susceptible to the adverse effects of changes in circumstances
and economic conditions than obligations in higher rated categories.
However, the obligor's capacity to meet its financial commitment on the
obligation is still strong.
A
An obligation rated "A"
is somewhat more susceptible to the adverse effects of changes in circumstances
and economic conditions than obligations in higher rated categories.
However, the obligor's capacity to meet its financial commitment on the
obligation is still strong.
BBB
An obligation rated
"BBB" exhibits adequate protection parameters. However, adverse
economic conditions or changing circumstances are more likely to lead to a
weakened capacity of the obligor to meet its financial commitment on the
obligation. Obligations rated "BB", "B",
"CCC" and "C" are regarded as having significant
speculative characteristics. "BB" indicates the least degree of
speculation and "C" the highest". While such obligations
will likely have some quality and protective characteristics, these may be
outweighed by large uncertainties or major exposures to adverse
conditions.
BB
An obligation rated "BB"
is less vulnerable to non-payment than other speculative issues. However,
it faces major ongoing uncertainties or exposure to adverse business,
financial, or economic conditions which could lead to the obligor's inadequate
capacity to meet its financial commitment on the obligation.
B
An obligation rated "B"
is more vulnerable to non-payment than obligations rated "BB", but
the obligor currently has the capacity to meet it financial commitment on the
obligation. Adverse business, financial or economic conditions will
likely impair the obligor's capacity or willingness to meet its financial commitment
on the obligation.
CCC
An obligation rated
"CCC" is currently vulnerable to non-payment, and is dependent upon
favourable business, financial and economic conditions for the obligor to meet
its financial commitment on the obligation. In the event of adverse
business, financial or economic conditions, the obligor is not likely to have
the capacity to meet its financial obligations.
CC
An obligation rated "CC"
is currently highly vulnerable to non-payment.
C
A subordinated debt or preferred
stock obligation rated "C" is currently highly vulnerable to
non-payment. The "C" rating may be used to cover a situation
where a bankruptcy petition has been filed or similar action taken, but
payments on this obligation are being continued. A "C" also will
be assigned to a preferred stock issue in 'arrears on dividends or sinking fund
payments', but that is currently paying.
D
An obligation rated "D"
is in payment default. The "D" rating category is used when
payments on an obligation are not made on the date due even if the applicable
grace period has not expired, unless Standard & Poor's believes that such
payment will be made during such grace period. The "D" rating
also will be used upon the filing of a bankruptcy petition or the taking of a
similar action if payments on an obligation are jeopardized. Plus (=) or
minus (-) : The ratings from "AA" to "CCC" may be
modified by the addition of a plus or minus sign to show relative standing
within the major rating categories.
R
This symbol is attached to the
ratings of instruments with significant non-credit risks. It highlights
risks to principal or volatility of expected returns which are not addressed in
the credit rating. Examples include: obligations linked or indexed to
equities, currencies, or commodities, obligations exposed to severe prepayment
risk – such as interest only or principal only mortgage securities and
obligations with unusually risky interest terms, such as inverse floaters.
NR
This indicates that no rating has
been requested, that there is insufficient information on which to base a
rating, or that Standards & Poor's does not rate a particular obligation as
a matter of policy.
Short
Term Issue Credit Ratings
A-1
A short-term obligations rated
"A-1" is rated the highest category by Standard & Poor's.
The obligor's capacity to meet its financial commitment on the obligation is
strong. Within this category, certain obligations are designated with a
plus sign (+). This indicates that the obligor's capacity to meet it financial
commitment on these obligations is extremely strong.
A-2
A short-term obligation rated
"A-2" is somewhat more susceptible to the adverse effects of changes
in circumstances and economic conditions than obligations in higher rating
categories. However the obligor's capacity to meet its financial
commitment on the obligation is satisfactory.
A-3
A short-term obligation rated
"A-3" exhibits adequate protection parameters. However, adverse
economic conditions or changing circumstance are more likely to lead to a
weakened capacity of the obligor to meet its financial commitment on the
obligation.
B
A short-term obligation rated
"B" is regarded has having significant speculative
characteristics. The obligor currently has the capacity to meet its financial
commitment on the obligation, however, it faces major ongoing uncertainties
which could lead to the obligor's inadequate capacity to meet its financial
commitment on the obligation.
C
A short-term obligation rated
"C" is currently vulnerable to non-payment and is dependent upon
favourable business, financial and economic conditions for the obligor to meet
its financial commitment on the obligation.
D
A short-term obligation rated
"D" is in payment default. The "D" rating category is
used when payments on an obligation are not made on the date due even if the
applicable grace period has not expired, unless Standard & Poor's believes
that such payments will be made during such grace period. The "D"
rating also will be used upon the filing of a bankruptcy petition or the taking
of a similar action if payments on an obligation are jeopardised.
Local
Currency and Foreign Currency Risks
Country risk considerations are a
standard part of Standard & Poor's analysis for credit ratings on any
issuer or issue. Currency of repayment is a key factor in this
analysis. An obligor's capacity to repay foreign currency obligations may
be lower than its capacity to repay obligations in its local currency due to
the sovereign government's own relatively lower capacity to repay external
versus domestic debt. These sovereign risk considerations are
incorporated in the debt ratings assigned to specific issues. Foreign
currency issuer ratings are also distinguished from local currency issuer
ratings to identify those instances where sovereign risks make them different
for the same issuer.
Section
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TITLE: |
WORK SAFETY HEALTH POLICY |
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ADOPTED: |
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REVIEWED: |
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ASSOCIATED LEGISLATION: |
Occupational Health and Safety Act 1984 Occupational Health and Safety Regulations 1996 |
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ASSOCIATED DOCUMENTS: |
Business Operating Procedure - Hazard Reporting Business Operating Procedure - Workers Compensation & Injury Management |
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REVIEW RESPONSIBILITY: |
Manager Human Resources |
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DELEGATION: |
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Previous Policy Number N/A
Objective:
The Shire of Broome is committed to promoting and improving standards for Occupational Safety and Health with the aim of sustaining a safe working and community environment.
Definitions:
Best practice as defined by the occupational health and safety legislative framework as, a document prepared for the purpose of providing:
a. practical advice on preventive strategies; and
b. practical means of achieving any code, standard, rule, provision or specification relating to occupational safety and health in Western Australia
Guidance Note is an explanatory document providing detailed information on the requirements on legislation, regulations, standards, codes of practice or matters relating to occupational safety and health, as approved by the Commission for Occupational Safety and Health.
Australian Standards is a term that refers to the occupational health and safety legislative framework and is defined as guidance material developed by Standards Australia or jointly by Standards Australia and Standards New Zealand.
Policy:
The Shire of Broome will continuously work towards achieving best practice in accordance with the Occupational Safety and Health Act 1984, Occupational Safety and Health Regulations 1996, Codes of Practice, Guidance Notes and Australian Standards.
The Shire is committed to achieving safe work practice through;
§ Creating a positive safety culture
§ Ongoing development and improvement of Occupational Health and Safety Systems within the Shire, across all business functions;
§ Consultation with employees, contractors and volunteers in the development and improvement of work health and safety business operating procedures, programs and work instructions, where appropriate;
§ Providing employees, contractors and volunteers with the necessary information, instruction and training to increase knowledge and skills in order to work safely;
§ Enable reporting mechanisms to identify hazards, assess risk and implement control measures in an effective and timely manner;
§ Compliance so far as is reasonably practicable with all applicable health, safety and environmental laws and standards;
§ Open communication with employees, contractors, volunteers and visitors about work health and safety matters.
The Shire of Broome acknowledges that the achievement a safe work environment requires the commitment of all management, officers, contractors, and volunteers. It is expected, therefore, that everyone will strive to meet their obligations as outlined in the Occupational Health and Safety Act 1984, and actively contribute to the Shires workplace safety system. All persons at the workplace are to abide by procedures that have been created in the interest of worker health and safety.
The Chief Executive Officer and the Council are committed to the successful implementation of this policy. They are supported in this regard by the Chairperson for the Work Health and Safety Committee and all staff are encouraged to make a similar commitment.
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TITLE: |
INTERNAL CONTROL |
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ADOPTED: |
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REVIEWED: |
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ASSOCIATED LEGISLATION: |
Local Government (Financial Management) Regulations 1996 – Regulation 5 Local Government (Audit) Regulations 1996 – Regulation 17 |
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ASSOCIATED DOCUMENTS: |
Policy 1.2.11 Risk Management Western Australian Local Government Accounting Manual Edition 3 - September 2012 |
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REVIEW RESPONSIBILITY: |
Chief Executive Officer |
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DELEGATION: |
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Introduction:
This policy provides documented evidence of Council’s commitment to appropriate and effective internal controls and their importance to the organisation.
This policy provides a framework for the establishment of documented internal controls that are implemented based on risk management policies and principles.
The purpose of this policy is to assist Council in carrying out its activities in an efficient and effective manner in order to achieve its strategic objectives, to ensure adherence to policies, to safeguard the Council's assets, and to secure (as far as possible) the accuracy and reliability of Council financial records.
The policy will assist the organisation in addressing the risk of; material misstatement of financial information, fraud and corruption, misappropriation of funds and loss of physical assets and ensure that Council meets its obligation under the Local Government Act 1995, associated Regulations and other legislation.
Objective:
1. To implement a risk-based approach to addressing and reducing the risk of loss caused by fraud, error or misstatement.
2. To protect the Shire of Broome’s assets – people, property, reputation, financial sustainability and information.
3. Continually audit, identify system gaps and improve internal controls maintained at the Shire of Broome.
Definitions:
Internal Control
Systems of policies and procedures that safeguard assets, ensure accurate and reliable financial reporting, promote compliance with laws and regulations and achieve effective and efficient operations. These systems not only relate to accounting and reporting but also include communication and organisational processes both internally and externally, staff management and error handling.[1]
Policy:
An appropriate and effective internal control framework is the responsibility of all employees. All employees are accountable for implementing systems, controls, processes and procedures in their own area of responsibility and will play a part in the internal control framework in differing degrees.
The Audit Committee and Council are responsible for mandating that a strong internal control framework be implemented in order to have assurance of the good governance of the organisation. The Chief Executive Officer will report regularly to the Audit Committee and Council on the review and improvement to Council’s internal control framework.
Monitoring, Reviewing and Reporting:
A monitoring and reporting process/system will be implemented which will provide biannual reports to management, the Audit Committee and Council on the status of Risk Management, Internal Controls and Legislative Compliance within the Shire of Broome and which will identify the need for specific areas for review.
In line with Regulation 17 of the Local Government (Audit) Regulations 1996, the Chief Executive Officer is required to report on a review of the above three areas biennially. This is in addition to the four yearly review required by Regulation 5(2)(c) of the Local Government (Financial Management) Regulations 1996 which also includes a review of Council’s financial internal controls.
Policy Accountability and Review
The Chief Executive Officer is accountable for this policy.
This policy is to be reviewed every two years.
