C2 Risk Management and Internal Audit

The Directorate's risk management framework is based on the Australian and New Zealand Standard ISO 31000:2009 Risk Management - principles and guidelines. The Directorate's Audit Committee Charter reflects the Australian National Audit Office and the ACT Treasury best practice guides for Audit Committees.

Through both the 2013-14 business planning process and the 2011 Assurance Plan, risks were identified and mitigated through the Directorate's internal governance controls including:

• Risk Management Framework;
• Strategic Risk Profile;
• 2013 and 2014 School Audit Program;
• Fraud & Corruption, Prevention & Response Plan 2013-2015;
• internal audit programs;
• detailed financial policies and controls, such as the Director-General's Financial Instructions and the School Management Manual;
• detailed financial operating procedures and practices; and
• risk identification and analysis by executive directors, directors and managers.

The Directorate's risk management and internal audit functions were managed by the Director, Governance and Assurance Branch and senior staff of the Audit and Assurance Section. The Section was complemented with additional resources through a panel of external audit service providers.

The Directorate's senior executive and the Audit Committee received regular risk management reports, providing an overview of significant risks, mitigation strategies, responsibilities and an oversight on the implementation of audit recommendations.

The senior executive and the Audit Committee assisted with the allocation of resources and timeframes to ensure appropriate mitigation and monitoring strategies were implemented. Monitoring and reporting on risk management occurred through:

• regular monitoring of outcomes by the executive;
• reporting to the Audit Committee;
• reporting to the Senior Executive Team; and
• implementation of internal and external audit recommendations.

The Directorate managed financial risks through a well-defined financial management framework that included:

• clearly established ownership of internal budgets;
• monthly variance reporting by senior management;
• quarterly strategic review of financial performance and corrective actions as required by the executive;
• regularly updated financial procedures and practices documents; and
• provision of training to office and school-based staff.

The audits conducted in 2013-14 included:

• emergency management planning in schools and central office;
• payment processes for registered training organisations;
• workplace health and safety;
• use of credit cards within schools and central office;
• Director-General's Financial Instructions (DGFI);
• data integrity;
• risk management planning and implementation for swimming carnivals;
• records management in schools; and
• comprehensive financial and administrative audits for six schools.

Financial acquittals were conducted in accordance with Australian Accounting Standards.

The Audit Committee met seven times during 2013-14. The Committee membership and attendance are displayed in Table C2.1.

Table C2.1: Audit Committee membership and attendance in 2013-14

Source: Chief Internal Auditor, Education and Training Directorate

Notes:
a. Ms Lilley appointed May 2014
b. Ms Morison resigned effective April 2014
c. Mr Whybrow resigned June 2014
d. Ms Johnston resigned February 2014

For further information contact:
Director, Governance and Assurance
(02) 6205 9329