Notice of Meeting

 

 

 

 

 

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Audit, Risk and Improvement Committee Meeting

 

 

An Audit, Risk and Improvement Committee Meeting of Byron Shire Council will be held as follows:

 

Venue

Conference Room, Station Street, Mullumbimby

Date

Thursday, 30 May 2019

Time

11.30am

 

 

 

 

 

Vanessa Adams

Director Corporate and Community Services                                                                    I2019/780

                                                                                                                                    Distributed 23/05/19

 

 


CONFLICT OF INTERESTS

What is a “Conflict of Interests” - A conflict of interests can be of two types:

Pecuniary - an interest that a person has in a matter because of a reasonable likelihood or expectation of appreciable financial gain or loss to the person or another person with whom the person is associated.

Non-pecuniary – a private or personal interest that a Council official has that does not amount to a pecuniary interest as defined in the Local Government Act (eg. A friendship, membership of an association, society or trade union or involvement or interest in an activity and may include an interest of a financial nature).

Remoteness – a person does not have a pecuniary interest in a matter if the interest is so remote or insignificant that it could not reasonably be regarded as likely to influence any decision the person might make in relation to a matter or if the interest is of a kind specified in Section 448 of the Local Government Act.

Who has a Pecuniary Interest? - a person has a pecuniary interest in a matter if the pecuniary interest is the interest of the person, or another person with whom the person is associated (see below).

Relatives, Partners - a person is taken to have a pecuniary interest in a matter if:

§  The person’s spouse or de facto partner or a relative of the person has a pecuniary interest in the matter, or

§  The person, or a nominee, partners or employer of the person, is a member of a company or other body that has a pecuniary interest in the matter.

N.B. “Relative”, in relation to a person means any of the following:

(a)   the parent, grandparent, brother, sister, uncle, aunt, nephew, niece, lineal descends or adopted child of the person or of the person’s spouse;

(b)   the spouse or de facto partners of the person or of a person referred to in paragraph (a)

No Interest in the Matter - however, a person is not taken to have a pecuniary interest in a matter:

§  If the person is unaware of the relevant pecuniary interest of the spouse, de facto partner, relative or company or other body, or

§  Just because the person is a member of, or is employed by, the Council.

§  Just because the person is a member of, or a delegate of the Council to, a company or other body that has a pecuniary interest in the matter provided that the person has no beneficial interest in any shares of the company or body.

Disclosure and participation in meetings

§  A Councillor or a member of a Council Committee who has a pecuniary interest in any matter with which the Council is concerned and who is present at a meeting of the Council or Committee at which the matter is being considered must disclose the nature of the interest to the meeting as soon as practicable.

§  The Councillor or member must not be present at, or in sight of, the meeting of the Council or Committee:

(a)   at any time during which the matter is being considered or discussed by the Council or Committee, or

(b)   at any time during which the Council or Committee is voting on any question in relation to  the matter.

No Knowledge - a person does not breach this Clause if the person did not know and could not reasonably be expected to have known that the matter under consideration at the meeting was a matter in which he or she had a pecuniary interest.

Participation in Meetings Despite Pecuniary Interest (S 452 Act)

A Councillor is not prevented from taking part in the consideration or discussion of, or from voting on, any of the matters/questions detailed in Section 452 of the Local Government Act.

Non-pecuniary Interests - Must be disclosed in meetings.

There are a broad range of options available for managing conflicts & the option chosen will depend on an assessment of the circumstances of the matter, the nature of the interest and the significance of the issue being dealt with.  Non-pecuniary conflicts of interests must be dealt with in at least one of the following ways:

§  It may be appropriate that no action be taken where the potential for conflict is minimal.  However, Councillors should consider providing an explanation of why they consider a conflict does not exist.

§  Limit involvement if practical (eg. Participate in discussion but not in decision making or vice-versa).  Care needs to be taken when exercising this option.

§  Remove the source of the conflict (eg. Relinquishing or divesting the personal interest that creates the conflict)

§  Have no involvement by absenting yourself from and not taking part in any debate or voting on the issue as if the provisions in S451 of the Local Government Act apply (particularly if you have a significant non-pecuniary interest)

RECORDING OF VOTING ON PLANNING MATTERS

Clause 375A of the Local Government Act 1993 – Recording of voting on planning matters

(1)   In this section, planning decision means a decision made in the exercise of a function of a council under the Environmental Planning and Assessment Act 1979:

(a)   including a decision relating to a development application, an environmental planning instrument, a development control plan or a development contribution plan under that Act, but

(b)   not including the making of an order under Division 2A of Part 6 of that Act.

(2)   The general manager is required to keep a register containing, for each planning decision made at a meeting of the council or a council committee, the names of the councillors who supported the decision and the names of any councillors who opposed (or are taken to have opposed) the decision.

(3)   For the purpose of maintaining the register, a division is required to be called whenever a motion for a planning decision is put at a meeting of the council or a council committee.

(4)   Each decision recorded in the register is to be described in the register or identified in a manner that enables the description to be obtained from another publicly available document, and is to include the information required by the regulations.

(5)   This section extends to a meeting that is closed to the public.

 


BYRON SHIRE COUNCIL

Audit, Risk and Improvement Committee Meeting

 

 

BUSINESS OF MEETING

 

1.    Apologies

2.    Declarations of Interest – Pecuniary and Non-Pecuniary

3.    Adoption of Minutes from Previous Meetings

3.1       Audit, Risk and Improvement Committee Meeting held on 14 February 2019

4.    Staff Reports

General Manager

4.1       Local Government Performance Excellence Program 2018 Report............................... 4   

5.    Confidential Reports

Corporate and Community Services

5.1       Confidential - 2018-2019 External Audit Engagement Plan................................. 149

5.2       Confidential - Updated Internal Audit Plan - May 2019........................................ 150

5.3       Confidential - Cash Management Audit Review................................................... 151

5.4       Confidential - Payroll Audit Review...................................................................... 152

5.5       Confidential - Audit Progress Report - May 2019................................................. 153

5.6       Confidential - Update on IT Actions...................................................................... 154  

 

 


BYRON SHIRE COUNCIL

Staff Reports - General Manager                                                                                   4.1

 

 

Staff Reports - General Manager

 

Report No. 4.1             Local Government Performance Excellence Program 2018 Report

Directorate:                 General Manager

Report Author:           Shannon McKelvey, Executive Officer

File No:                        I2019/680

                                       

 

 

Summary:

 

Attached is the Local Government Performance Excellence Program report for 2019 for Byron Shire Council.

 

 

  

 

RECOMMENDATION:

That the Internal Audit, Risk and Improvement Committee notes the Byron Shire Council LG Performance Excellence Program FY17 Report.

 

 

 

Attachments:

 

1        Local Government Performance Excellence Program - FY2018 Report, E2019/1094 , page 8  

 

 


 

REPORT

 

This is the second time the LG Performance Excellence Program (PEP) has been presented to this Committee. 

 

The report is in three sections:

 

i.          Background information on the program and our participation.

 

ii.          Information on our approach to the program, how it should and, importantly, should not be used.

 

iii.         FY2018 report discussion.

 

Background

 

In 2014, as an industry-driven initiative, the Local Government Performance Excellence Program (PEP) was developed by LG Professionals NSW, PwC and foundation councils, which included Byron Shire and, within a year all NOJO councils.  As a NSW initiative, the PEP was developed based on the structure of NSW reporting.

 

Each year the PEP is improved, in terms of scope, breadth of participants (increasing the available benchmarking) and both the data collection and reporting systems.

 

The service delivery area initially started as a close review (“deep dive”) of only three areas. In 2017 this was expanded to four and in 2018 Byron Shire Council participated in a pilot program to expand it to include metrics on Development and Building Application processing as well as swimming pool management.

 

The PEP provides Council with a timely analysis of data. Each year data collation has occurred more easily and the report has been able to be produced more quickly, even though it has become more detailed. The reports are now available in December each year. The delay in bringing the 2018 report to this Committee has arisen from trying to find time to workshop it with Councillors first, which has not been able to happen so far this year. In future, the intention will be to report it straight to this Committee at its first meeting in the new calendar year.

 

In addition to the annual individualised PEP report, the Program also provides Council with:

 

-     online tools to analyse the data using filters such as location, size, population or OLG group classification; and

 

-     a regional planning tool where we can share and discuss results between participating NOJO councils to identify opportunities to learn from each other (nb Council is unable to publish this data but it helps us share and learn from each other). 

 

Council has committed to participating in the program for the next three years.

 


 

How to use the PEP information – comparison of Council’s own results over time

 

The main purpose of the PEP is to help Council to compare its performance against its own results over time. 

 

The PEP contains comparative benchmarking, within local government and with private business, drawing on PwC’s extensive data analytics experience. 

 

Where there are no local circumstances that influence services, the data can be used to benchmark council performance against industry averages. An example is the workforce diversity or leave balance results.

 

Where local decisions and local circumstances influence services, it is not appropriate to use the benchmarking. That is because each council is unique in the services they provide, the way they deliver services and what levels of service communities expect. Examples of local factors that directly influence performance results include:

 

·    geographic or climate influences e.g. Byron Shire’s high exposure to severe weather events; 

·    community values and expectations on levels of service e.g. Byron Shire’s commitment to delivering high environmental and social outcomes, over and above usual service outcomes, can be a driver of higher costs or the need for more resources; or

·    Shire-specific drivers e.g. the 2M+ tourists to the Byron Shire. 

 

The PEP data is used by Byron Council in a variety of ways, e.g.:

 

-     identifying improvement opportunities;

-     developing annual Operational Plan activities;

-     reporting on performance to community in various ways;

-     informing the IP&R Workforce Strategy and workforce policy settings;

-     using the regional NOJO window to identify and act on regional opportunities;

-     research and benchmarking;

-     lobbying, for example it is used extensively as supporting data for lobbying on matters related to tourism and infrastructure funding, by comparing service performance between different areas relative to tourist numbers; 

-     informing independent service reviews;

-     supporting grant and other applications, e.g. the SRV application used PEP data.

 

 

FY2018 Report

 

The FY2018 report contains a mix of positive results and potential opportunities for further review or improvement. Staff can provide more information and answer questions on any particular area at the meeting or in future reports to the Committee, as there are too many metrics to provide context and commentary on each.

 

Staff are also able to provide a demonstration of the online comparison tools we receive as part of our subscription to the PEP.

 


 

STRATEGIC CONSIDERATIONS

 

Community Strategic Plan and Operational Plan

CSP Objective

L2

CSP Strategy

L3

DP Action

L4

OP Activity

Community Objective 5:  We have community led decision making which is open and inclusive

5.6

Manage Council’s resources sustainably

5.6.10

Use business insights and strategic business planning to  continuously improve (SP)

5.6.10.1

Complete 2018 LG Performance Excellence Program

 

Legal/Statutory/Policy Considerations

 

Council voluntarily participates in the program. A recent NSW Auditor local government performance report has again recommended that the Office of Local Government develop a mandatory Performance Framework for councils. LG Professionals and participating councils have been lobbying Office of Local Government to leverage the extensive research and development that has gone into the PEP and adopt it as the performance framework.

 

Financial Considerations

 

As a foundation member, Council receives a discounted price. Council has subscribed to the LG PEP, including the regional comparative tool, for the next four years, at a cost of around $7,700 pa, together with a fee of $1,100 pa for subscription to regional comparative windows. Staff time required to extract and submit the data is resourced through existing positions. Each year, as Council’s data management systems and automation improve, the staff time required reduces.

 

Consultation and Engagement

 

Once considered by the Committee and Council via the Committee Minutes, the report will be published on Council’s website and made publicly available to the community as part of Council’s commitments to transparency and improvement.

 


BYRON SHIRE COUNCIL

Staff Reports - General Manager                                                                  4.1 - Attachment 1

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BYRON SHIRE COUNCIL

Confidential Reports - Corporate and Community Services                            5.1

 

 

Confidential Reports - Corporate and Community Services

 

Report No. 5.1             Confidential - 2018-2019 External Audit Engagement Plan

Directorate:                 Corporate and Community Services

Report Author:           James Brickley, Manager Finance

File No:                        I2019/251

                                       

 

 

Summary:

 

This report presents the 2018-2019 External Audit Engagement Plan for Council to the Audit, Risk and Improvement Committee.

 

 

RECOMMENDATION:

1.       That pursuant to Section 10A(2)(d)i of the Local Government Act, 1993, Council resolve to move into Confidential Session to discuss the report 2019 External Audit Engagement Plan.

 

2.       That the reasons for closing the meeting to the public to consider this item be that the report contains:

a)      commercial information of a confidential nature that would, if disclosed prejudice the commercial position of the person who supplied it

 

3.       That on balance it is considered that receipt and discussion of the matter in open Council would be contrary to the public interest, as:

 

Potential to prejudice the commercial position of the contracted Auditor Thomas Noble and Russell undertaking the audit on behalf of the Audit Office of New South Wales and disclosure request by the Audit Office of New South Wales.

 

  

Attachments:

 

1        Confidential - 2018-2019 Final External Audit Engagement Plan, E2019/13601  

 

 

 


BYRON SHIRE COUNCIL

Confidential Reports - Corporate and Community Services                            5.2

 

 

Report No. 5.2             Confidential - Updated Internal Audit Plan - May 2019

Directorate:                 Corporate and Community Services

Report Author:           Heather Sills, Corporate Governance Officer

File No:                        I2019/742

                                       

 

 

Summary:

 

This report provides the Audit, Risk and Improvement Committee with an update on the Internal Audit Plan with proposed revisions.

 

 

 

RECOMMENDATION:

1.       That pursuant to Section 10A(2)(d)i of the Local Government Act, 1993, Council resolve to move into Confidential Session to discuss the report Updated Internal Audit Plan - May 2019.

 

2.       That the reasons for closing the meeting to the public to consider this item be that the report contains:

a)      commercial information of a confidential nature that would, if disclosed prejudice the commercial position of the person who supplied it

 

3.       That on balance it is considered that receipt and discussion of the matter in open Council would be contrary to the public interest, as:

 

the report contains commericial information pertaining to Council's internal audit process

 

  

Attachments:

 

1        Confidential - Updated BSC Internal Audit Plan May 2019, E2019/35227  

 

 

 


BYRON SHIRE COUNCIL

Confidential Reports - Corporate and Community Services                            5.3

 

 

Report No. 5.3             Confidential - Cash Management Audit Review

Directorate:                 Corporate and Community Services

Report Author:           Jessica Orr, Strategic Risk and Improvement Coordinator

File No:                        I2019/655

                                       

 

 

Summary:

 

Council’s Internal Auditors, O’Connor Marsden and Associates (OCM), conducted an internal audit review of Cash Management systems and processes during February 2019. Their report is at

Confidential Attachment 1.

 

This audit identified four Medium risks and agreed recommendations and actions are included in the Confidential Attachment.

 

 

 

RECOMMENDATION:

1.       That pursuant to Section 10A(2)(d)i of the Local Government Act, 1993, Council resolve to move into Confidential Session to discuss the report Cash Management Audit Review.

 

2.       That the reasons for closing the meeting to the public to consider this item be that the report contains:

a)      commercial information of a confidential nature that would, if disclosed prejudice the commercial position of the person who supplied it

 

3.       That on balance it is considered that receipt and discussion of the matter in open Council would be contrary to the public interest, as:

 

nature and content of audit report is for operational purposes

 

  

Attachments:

 

1        Confidential - Internal Audit Report - Review of Cash Management - Final Report - 15 May 2019, E2019/35202  

 

 

 


BYRON SHIRE COUNCIL

Confidential Reports - Corporate and Community Services                            5.4

 

 

Report No. 5.4             Confidential - Payroll Audit Review

Directorate:                 Corporate and Community Services

Report Author:           Jessica Orr, Strategic Risk and Improvement Coordinator

File No:                        I2019/657

                                       

 

 

Summary:

 

Council’s Internal Auditors, O’Connor Marsden and Associates (OCM), conducted an internal audit review of Payroll systems and processes during March 2019. Their report is at Confidential Attachment 1.

 

The findings made by OCM include one High rated risk in relation to Business Continuity and 4 Medium rated risks. The recommendations have been agreed with key stakeholders.

 

 

RECOMMENDATION:

1.       That pursuant to Section 10A(2)(a) and (f) of the Local Government Act, 1993, Council resolve to move into Confidential Session to discuss the report Payroll Audit Review.

 

2.       That the reasons for closing the meeting to the public to consider this item be that the report contains:

a)      personnel matters concerning particular individuals (other than councillors)

b)      details of systems and/or arrangements that have been implemented to protect council, councillors, staff and Council property

 

3.       That on balance it is considered that receipt and discussion of the matter in open Council would be contrary to the public interest, as:

 

nature and content of audit report is for operational purposes

 

  

Attachments:

 

1        Confidential - Internal Audit Report - Payroll - FINAL - 13 May 2019, E2019/35209  

 

 

 


BYRON SHIRE COUNCIL

Confidential Reports - Corporate and Community Services                            5.5

 

 

Report No. 5.5             Confidential - Audit Progress Report - May 2019

Directorate:                 Corporate and Community Services

Report Author:           Heather Sills, Corporate Governance Officer

File No:                        I2019/711

                                       

 

 

Summary:

 

This report presents the Internal Audit Outstanding Actions Report - May 2019 prepared by Council and the Internal Auditor, O’Connor Marsden and Associates (OCM).

 

The activity report contains the remaining outstanding recommendations from each audit review conducted by Council’s previous internal audit provider as well as recommendations from recently completed audit reviews conducted by OCM.

 

 

 

RECOMMENDATION:

1.       That pursuant to Section 10A(2)(d)i of the Local Government Act, 1993, Council resolve to move into Confidential Session to discuss the report Audit Progress Report - May 2019.

 

2.       That the reasons for closing the meeting to the public to consider this item be that the report contains:

a)      commercial information of a confidential nature that would, if disclosed prejudice the commercial position of the person who supplied it

 

3.       That on balance it is considered that receipt and discussion of the matter in open Council would be contrary to the public interest, as:

 

nature and content of audit report is for operational purposes

 

  

Attachments:

 

1        Internal Audit Activity Report - as at May 2019, E2019/35523  

 

 

 


BYRON SHIRE COUNCIL

Confidential Reports - Corporate and Community Services                            5.6

 

 

Report No. 5.6             Confidential - Update on IT Actions

Directorate:                 Corporate and Community Services

Report Author:           Phil Pountney, Manager Business Systems and Technology

File No:                        I2019/778

                                       

 

 

Summary:

 

This report provides an update on outstanding audit actions that fall under the Business Systems and Technology portfolio.

 

 

RECOMMENDATION:

1.       That pursuant to Section 10A(2)(f) of the Local Government Act, 1993, Council resolve to move into Confidential Session to discuss the report Update on IT Actions.

 

2.       That the reasons for closing the meeting to the public to consider this item be that the report contains:

a)      details of systems and/or arrangements that have been implemented to protect council, councillors, staff and Council property

 

3.       That on balance it is considered that receipt and discussion of the matter in open Council would be contrary to the public interest, as:

 

Exposes information security risk and vulnerabilities that could assist threats in the environment to expose Council data and systems to those without authorisation.

 

  

Attachments:

 

1        24.2017.7.1 - ISMS - Security Risk Assessment - Certitude - TRA-v1.1 (1 April 2019), E2019/36191