AGENDA
Assurance, Risk and Finance Committee Meeting
Wednesday, 12 February 2020
Time: |
1.00 pm |
Location: |
Council Chamber Memorial Avenue Kaikohe |
Membership:
Councillor John Vujcich - Chairperson
Mayor John Carter
Member Bruce Robertson
Councillor Ann Court
Councillor Mate Radich
Councillor Kelly Stratford
Councillor Moko Tepania
Assurance, Risk and Finance Committee Meeting Agenda |
12 February 2020 |
ASSURANCE, RISK AND FINANCE COMMITTEE - MEMBERS REGISTER OF INTERESTS
Name |
Responsibility (i.e. Chairperson etc) |
Declaration of Interests |
Nature of Potential Interest |
Member's Proposed Management Plan |
Hon John Carter QSO |
Board Member of the Local Government Protection Programme |
Board Member of the Local Government Protection Program |
|
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Carter Family Trust |
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|
John Vujcich (Chair) |
Board Member |
Pioneer Village |
Matters relating to funding and assets |
Declare interest and abstain |
Director |
Waitukupata Forest Ltd |
Potential for council activity to directly affect its assets |
Declare interest and abstain |
|
Director |
Rural Service Solutions Ltd |
Matters where council regulatory function impact of company services |
Declare interest and abstain |
|
Director |
Kaikohe (Rau Marama) Community Trust |
Potential funder |
Declare interest and abstain |
|
Partner |
MJ & EMJ Vujcich |
Matters where council regulatory function impacts on partnership owned assets |
Declare interest and abstain |
|
Member |
Kaikohe Rotary Club |
Potential funder, or impact on Rotary projects |
Declare interest and abstain |
|
Member |
New Zealand Institute of Directors |
Potential provider of training to Council |
Declare a Conflict of Interest |
|
Member |
Institute of IT Professionals |
Unlikely, but possible provider of services to Council |
Declare a Conflict of Interest |
|
Member |
Kaikohe Business Association |
Possible funding provider |
Declare a Conflict of Interest |
|
Bruce Robertson (Deputy) |
No Form Received |
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Deputy Mayor Ann Court |
Waipapa Business Association |
Member |
|
Case by case |
Warren Pattinson Limited |
Shareholder |
Building company. FNDC is a regulator and enforcer |
Case by case |
|
Kerikeri Irrigation |
Supplies my water |
|
No |
|
Top Energy |
Supplies my power |
|
No other interest greater than the publics |
|
District Licensing |
N/A |
N/A |
N/A |
|
Top Energy Consumer Trust |
Trustee |
Crossover in regulatory functions, consenting economic development and contracts such as street lighting. |
Declare interest and abstain from voting. |
|
Ann Court Trust |
Private |
Private |
N/A |
|
Waipapa Rotary |
Honorary member |
Potential community funding submitter |
Declare interest and abstain from voting. |
|
Properties on Onekura Road, Waipapa |
Owner Shareholder |
Any proposed FNDC Capital works or policy change which may have a direct impact (positive/adverse) |
Declare interest and abstain from voting. |
|
Property on Daroux Dr, Waipapa |
Financial interest |
Any proposed FNDC Capital works or policy change which may have a direct impact (positive/adverse) |
Declare interest and abstain from voting. |
|
Flowers and gifts |
Ratepayer 'Thankyou' |
Bias/ Pre-determination? |
Declare to Governance |
|
Coffee and food |
Ratepayers sometimes 'shout' food and beverage |
Bias or pre-determination |
Case by case |
|
Staff |
N/A |
Suggestion of not being impartial or pre-determined! |
Be professional, due diligence, weigh the evidence. Be thorough, thoughtful, considered impartial and balanced. Be fair. |
|
Warren Patteinson |
My husband is a builder and may do work for Council staff |
|
Case by case |
|
Ann Court - Partner |
Warren Pattinson Limited |
Director |
Building Company. FNDC is a regulator |
Remain at arm’s length |
Air NZ |
Shareholder |
None |
None |
|
Warren Pattinson Limited |
Builder |
FNDC is the consent authority, regulator and enforcer. |
Apply arm’s length rules |
|
Kurbside Rod and Custom Club (unlikely) |
President NZ Hot Rod Association |
Potential to be linked to a funding applicant and my wife is on the decision-making committee. |
unlikely to materialise but would absent myself from any process as would Ann. |
|
Property on Onekura Road, Waipapa |
Owner |
Any proposed FNDC capital work in the vicinity or rural plan change. Maybe a link to policy development. |
Would not submit. Rest on a case by case basis. |
|
Mate Radich |
No form received |
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|
|
Kelly Stratford |
KS Bookkeeping and Administration |
Business Owner, provides book keeping, administration and development of environmental management plans |
None perceived |
Step aside from decisions that arise, that may have conflicts |
Waikare Marae Trustees |
Trustee |
Maybe perceived conflicts |
Case by case basis |
|
Bay of Islands College |
Parent Elected Trustee |
None perceived |
If there was a conflict, I will step aside from decision making |
|
Karetu School |
Parent Elected Trustee |
None perceived |
If there was a conflict, I will step aside from decision making |
|
Maori title land – Moerewa and Waikare |
Beneficiary and husband is a shareholder |
None perceived |
If there was a conflict, I will step aside from decision making |
|
Sister is employed by Far North District Council |
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|
Wil not discuss work/governance mattes that are confidential |
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Gifts - food and beverages |
Residents and ratepayers may ‘shout’ food and beverage |
Perceived bias or predetermination |
Case by case basis |
|
Kelly Stratford - Partner |
Chef and Barista |
Opua Store |
None perceived |
|
Maori title land – Moerewa |
Shareholder |
None perceived |
If there was a conflict of interest, I would step aside from decision making |
|
Moko Tepania |
Teacher at Te Kura Kaupapa Māori o Kaikohe. |
Potential Council funding that will benefit my place of employment. |
|
Declare a perceived conflict |
Chairperson at Te Reo o Te Tai Tokerau Trust. |
Potential Council funding for events that this trust runs. |
|
Declare a perceived conflict |
|
Tribal Member – Te Rūnanga o Te Rarawa |
As a descendent of Te Rarawa I could have a perceived conflict of interest in Te Rarawa Council relations. |
|
Declare a perceived conflict |
|
Tribal Member - Te Rūnanga o Whaingaroa |
As a descendent of Te Rūnanga o Whaingaroa I could have a perceived conflict of interest in Te Rūnanga o Whaingaroa Council relations. |
|
Declare a perceived conflict |
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Tribal Member – Kahukuraariki Trust Board |
As a descendent of Kahukuraariki Trust Board I could have a perceived conflict of interest in Kahukuraariki Trust Board Council relations. |
|
Declare a perceived conflict |
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Tribal Member – Te Rūnanga ā-Iwi o Ngāpuhi |
As a descendent of Te Rūnanga ā-Iwi o Ngāpuhi I could have a perceived conflict of interest in Te Rūnanga ā-Iwi o Ngāpuhi Council relations. |
|
Declare a perceived conflict |
Assurance, Risk and Finance Committee Meeting Agenda |
12 February 2020 |
Assurance, Risk and Finance Committee Meeting
will be held in the Council Chamber, Memorial Avenue, Kaikohe on:
Wednesday 12 February 2020 at 1.00 pm
Order Of Business
1 Apologies and Declarations of Interest
3.1 Audit Management Report for June 2019
3.2 Revenue Recovery Report - February 2020
3.3 Internal Audit and Assurance Report
3.5 Financial Report for the period ending 31 December 2019
4.2 FNDC Current Legal Action Potential Liability Claims
4.3 Rate arrears - collection options
Members need to stand aside from decision-making when a conflict arises between their role as a Member of the Committee and any private or other external interest they might have. This note is provided as a reminder to Members to review the matters on the agenda and assess and identify where they may have a pecuniary or other conflict of interest, or where there may be a perception of a conflict of interest.
If a Member feels they do have a conflict of interest, they should publicly declare that at the start of the meeting or of the relevant item of business and refrain from participating in the discussion or voting on that item. If a Member thinks they may have a conflict of interest, they can seek advice from the Chief Executive Officer or the Team Leader Democracy Support (preferably before the meeting).
It is noted that while members can seek advice the final decision as to whether a conflict exists rests with the member.
No requests for deputations were received at the time of the Agenda going to print.
12 February 2020 |
3.1 Audit Management Report for June 2019
File Number: A2823691
Author: Janice Smith, Chief Financial Officer
Authoriser: William J Taylor MBE, General Manager - Corporate Services
Purpose of the Report
To present the final Audit Management Report for the Annual Report process for June 2019.
Executive Summary
· Audit New Zealand prepares an Audit Management report upon the closure of each Annual report audit. This contains issues that require management response as well as issues that remain outstanding from previous reports.
That the Assurance, Risk and Finance Committee receive the report “Audit Management Report for June 2019”. |
1) Background
Audit New Zealand prepares an Audit Management report upon the closure of each Annual report audit. This contains issues that require management response as well as issues that remain outstanding from previous reports. The current report for June 2019 identifies five new issues which are deemed “necessary” with 17 issues from prior audits of which three are now closed with 14 remaining “active” as part of this report.
2) Discussion and Options
The report was approved for release to Council by the Audit Manager on the 28th November 2019.
The one “urgent” item that remains open from prior audits relates to project management. The Project Management Framework has now been rolled out in the IAM team and it is anticipated that this issue will be either closed completely or reduced to a lower level in the next audit management report.
The report contains management’s response on all issues raised.
Reason for the recommendation
The actions required in relation to this report are covered separately in the Audit and Assurance reports to this committee.
3) Financial Implications and Budgetary Provision
There are no specific financial implications associated with this report.
1. Audit Management Report June 2019 - A2823685 ⇩
12 February 2020 |
3.2 Revenue Recovery Report - February 2020
File Number: A2825732
Author: Margriet Veenstra, Manager - Transaction Services
Authoriser: William J Taylor MBE, General Manager - Corporate Services
Purpose of the Report
The purpose of this report is to provide regular reporting to the Far North District Council Assurance, Risk and Finance Committee.
Executive Summary
· This is the first report for the financial year 2019/20 and provides information on action taken to collect the current and arrears balances for rates, water and sundry debt, and to provide information on how collection is tracking against targets.
That the Assurance, Risk and Finance Committee receive the report “Revenue Recovery Report - February 2020”. |
Background
This document has been prepared to outline current and arrears balances for rates, water and sundry debtors as at 31 December 2019 and the actions taken by the Debt Management Team for the collection of the debt.
This information is part of the standing items reported to the Committee on a regular basis.
Discussion and Next Steps
The information has been identified for general title and Māori Freehold Land rates and water accounts. Sundry debtors, which is another revenue stream for council, is shown in a separate table.
The total arrears balance for general title rates has reduced by 21% since 31 July 2019 and water by 35%. Māori Freehold Land rates has reduced by 1% since 31 July 2019 and water by 8%.
Below are the actions and focus areas for the first half of the rating year for the Debt Management Team for the collection of the general title rates and water.
· Continuing from last rating year, there are 64 properties currently with an external Law Firm to proceed with legal action for rates and water arrears.
o Action commenced on 45 properties;
§ Judgment by default was received for one property and another 6 have been submitted this month. A further 14 to be submitted in January 2020 once the deadline has passed.
§ 5 were paid in full and 11 have a Deed of Settlement agreement in place
§ Owners for 3 properties are to officially abandon the land
§ 5 require additional action, including serving of substituted service.
o The remaining 19 properties were withdrawn from legal proceedings as they were deemed to be Māori Land or subject to the 1967 Act.
o Next action(s) for properties where default judgment has been obtained, is to be discussed and agreed with Council.
· First phase of mortgage demand for general title properties commenced in December for 194 accounts with another 300 identified for the second phase for which mortgage demand will be issued in February to ensure payment by the end of the rating year.
· Continuous audit of existing Arrangements to Pay to ensure the agreements are being met.
· Ongoing promotion of the Internal Affairs Rates Rebates Scheme in day to day communications with Ratepayers.
Of the total number of accounts marked as ‘Balance to be collected by other means’:
· 56% of the arrears balance is made up of last year’s outstanding rates and 65% of the last two years.
· Of the 65%, we are due to commence the next tranche of Mortgage Demand for another 35% in February 2020.
· For the remaining 35%, the arrears balance is split across several years. Those with the highest debt balance, will have received Final Demand letters and are waiting to be referred for Legal proceedings once the first groups have been completed.
The Te Hono team relations and development initiatives have opened communications about payment of rates for Māori Freehold Land.
· Debt Management have been asked to provide and discuss payment options for some property owners in the past months.
· A list of 57 Māori Freehold land properties with Mortgages with a debt totalling $373K have been passed to the Te Hono team to initiate conversations prior to mortgage demand which is due to take place 20 February 2020.
Focus for the second half of the rating year for general title rates and water will be:
· Mortgage demand to be issued for a further 300 properties on 20 February 2020, together with 57 Māori Freehold Land properties.
· A letter to be sent to the remaining properties with mortgages but with low arrears balances, notifying them that they will be included in mortgage demand next rating year if the arrears balance is not addressed.
· Final mortgage demand for the 1st phase of 194 accounts will be issued on the 20th of March 2020.
· Details for all identified Abandoned Land properties will be passed for feedback in February 2020 to Council, Community Groups, Iwi, the NRC and Māori Land Court.
· Direct Debit switch/set up offer supported by ASB to be introduced with option for another offer next rating year to promote the Online Services launch.
· An article has been prepared in cooperation with the Communications team for publication in all local papers in January/February to explain Council is getting tougher on debt, outlining the options available to rate payers who have arrears.
The total sundry debtors aged debt has been reduced by 61% since 30 June 2019. The Debtors ledger was split alphabetically between Debt Management Officers at the start of the rating year, with each team member focussing on aged debt. Additionally, the team have:
· Regular monthly meetings with Compliance Support and Building Consents Support teams to resolve outstanding issues and implement process improvement where applicable.
· Continued collaboration with Council Legal team for advice and support for aged debt collection.
· Closed current accounts in Pathway without any activity for more than a year to avoid incorrect invoicing.
Financial Implications and Budgetary Provision
Provision is made annually for doubtful debts in relation to the arrears owed to council. A higher provision for Māori Freehold land rates and water is made in comparison to General Title rates and water due to the difference in collection options available to Council.
1. 2020-02-12 ARF Revenue recovery Report attachment - A2825313 ⇩
Assurance, Risk and Finance Committee Meeting Agenda |
12 February 2020 |
General Title rates and water rates analysis by age at 31 December 2019
Māori Freehold Land rates and water analysis by age at 31 December 2019.
Sundry Debtors by age for 31 December 2019.
12 February 2020 |
3.3 Internal Audit and Assurance Report
File Number: A2826403
Author: Lisa Huria, Audit and Assurance Specialist
Authoriser: William J Taylor MBE, General Manager - Corporate Services
Purpose of the Report
To provide an update on work completed within the Far North District Council Assurance Programme 2019.
Executive Summary
· This report provides an update on work completed within the FNDC Assurance Programme 2019.
· Update on the number of internal and external audit recommendations that have been completed or are currently underway.
That the Assurance, Risk and Finance Committee receive the report Internal Audit and Assurance Report. |
Background
The Audit, Risk, and Finance Committee approved the FNDC Assurance Programme 2019 at its March 2019 meeting.
This programme covered several areas requiring assurance such as TechnologyOne User Access, Conflict of Interest Management and the development and implementation of a Legislative Compliance Framework.
As per Audit New Zealand recommendation, a review was undertaken to ensure Chief Executive financial delegations to staff were entered correctly into the TechnologyOne system.
The review found there were some minor inconsistencies such as job titles that had changed slightly or had become obsolete. These inconsistencies had occurred mainly because of department and/or team realignments. In the future steps will be taken to ensure the Register of Delegations and TechnologyOne is updated when necessary.
Conflict of Interest Management
As per Audit New Zealand recommendation, a review was undertaken to ensure conflicts of interest are being managed for new and existing staff.
This review found that Employee Interest Declaration forms had been completed and received for 97% of 298 current staff employed before 2019. Management plans for staff that declared any perceived, potential or actual conflicts have been put in place for a number of these staff but there are still some to be completed.
43% of 103 staff that commenced employment during 2019 have yet to complete the Employee Interest Declaration form which has highlighted the need to improve this process. This improvement is now in progress. A follow up internal audit is scheduled for 2020.
Legislative Compliance Framework
A Legislative Compliance Framework is an essential part of managing risk in any organisation. It enables Council to carry out its statutory functions and duties by establishing and maintaining a system for monitoring and reporting on compliance with all relevant legislation.
· Responsibility lies with departmental managers to manage themselves with no formal system or process.
· A document, spreadsheet or SharePoint list is created that lists all relevant legislation, who is responsible and whether they comply or not. This list also needs to be manually kept up to date with all legislation changes.
· An online system which is kept up to date with legislation changes by the vendor; maps responsibilities; translates law into plain English; identifies compliance, corrective actions and legal risks; and provides high-level overview infographics reporting.
Stakeholder interviews to provide insight and feedback have been undertaken with relevant managers during January 2020. A business case containing a recommendation will be going to the Strategic Leadership Team for their approval in February/March 2020.
FNDC Assurance Programme 2020
This programme is currently being finalised and will be presented to the Assurance, Risk and Finance Committee for their endorsement once approved by the Strategic Leadership Team.
Audit Recommendations
Good progress has been made implementing recommendations from internal and external audits. There are plans in place to complete outstanding recommendations.
Audit Name |
Total Number of Recommendations |
Recommendations Completed |
Recommendations Underway |
External Audit - KPMG - Procurement 2017 |
34 |
29 |
5 |
External Audit - Audit NZ - Annual Management Report - Interim 2017 |
18 |
15 |
3 |
Internal Audit - Information Security 2018 |
15 |
12 |
3 |
Internal Audit - Contract Management Review 2018 |
4 |
3 |
1 |
External Audit - Audit NZ - Annual Management Report - Final 2018 |
5 |
4 |
1 |
External Audit - Audit NZ - Annual Management Report - Final 2019 |
6 |
1 |
5 |
External Audit - Three Waters Interim Alliance Agreement Review |
6 |
4 |
2 |
External Audit - MPI Council Food Act Recognised Agency Audit 2019 |
3 |
3 |
N/A |
External Audit - LGOIMA Compliance and Practice Report - 2019 |
30 |
13 |
17 |
External Audit - IANZ – Building Consent Authority Accreditation Assessment Report 2019 *nb: significant actions have been taken on the audit recommendations – these are currently being considered by IANZ and expect to be cleared before 14 February 2020 |
11 |
*0 |
11 |
Financial Implications and Budgetary Provision
This report is for information only.
12 February 2020 |
File Number: A2826762
Author: Tanya Reid, Manager Transformation, Risk and Audit (Acting)
Authoriser: William J Taylor MBE, General Manager - Corporate Services
Purpose of the Report
To provide the organisation’s top 12 risk dashboard, risk progress reports and group risk up-date.
No decision required.
Executive Summary
· Risk progress updates are provided for four of the top 12 risk treatment plans.
· Excellent progress has also been made on group risk.
That the Assurance, Risk and Finance Committee receive the report Risk Management Report.
|
Background
The Transformation and Assurance team has facilitated the development of treatment plans for the organisation’s top 12 risks. We are now in the phase where regular reporting of the organisation’s top 12 risks, and treatment plans, is in place.
A programme of deep dive workshops is planned for these risks. The first of two deep dive workshops for ARF005 Affordability Risk has been completed, with the second workshop to be scheduled.
The Transformation and Assurance team is working through the organisation to refresh / establish Group Risk registers, with treatment plans, and regular reviews.
Discussion and Next Steps
Four risk progress reports, with treatment plans, are attached. Risk ARF002, BCA Status Risk, is the subject of a separate report.
The ARF005 Affordability deep dive workshop has been split into two parts with the second part to be scheduled. At the end of this workshop members will agree the next risk “deep dive.”
An elected member workshop is to be scheduled to cover the FNDC Risk Management Framework.
Nine group (District Services, IAMs and Corporate Services) risk development workshops have been completed with a further eight workshops scheduled for these groups, including Strategic Planning & Policy. Further workshops are to be scheduled with the CEO Office.
Financial Implications and Budgetary Provision
At this stage no additional budgetary provision has been identified for the treatment plans.
1. 2020 01 ARF003 Health Safety and Wellbeing Vulnerabilities Risk Progress Report - A2827712 ⇩
2. 2020 01 ARF006 Projects Priorities Delivery Delays Risk Progress Report - A2826766 ⇩
3. 2020 01 ARF009 Customer Service Delivery Progress Report - A2827520 ⇩
4. 2020 01 ARF012 Contract Management Risks Progress Report - A2827432 ⇩
12 February 2020 |
3.5 Financial Report for the period ending 31 December 2019
File Number: A2827848
Author: Angie Thomas, Manager - Accounting Services
Authoriser: William J Taylor MBE, General Manager - Corporate Services
Purpose of the Report
To provide an overview and information on the current financial position and performance of the Far North District Council as at 31 December 2019.
Executive Summary
· Provid a summary overview, Statement of Financial Performance, Capital Performance and Borrowing and Investment reports.
That the Assurance, Risk and Finance Committee receive the report “Financial Report for the period ending 31 December 2019”.
|
1) Background
This reports financial information as at 31 December 2019.
2) Discussion and Options
The report is for information only.
Reason for the recommendation
The report is for information only.
3) Financial Implications and Budgetary Provision
There are no financial implications or budgetary provisions required as a result of this report.
1. Council Financial Report December 2019 - A2831718 ⇩
12 February 2020 |
RESOLUTION TO EXCLUDE THE PUBLIC
That the public be excluded from the following parts of the proceedings of this meeting. The general subject matter of each matter to be considered while the public is excluded, the reason for passing this resolution in relation to each matter, and the specific grounds under section 48 of the Local Government Official Information and Meetings Act 1987 for the passing of this resolution are as follows:
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