TEACHER OF MATHS

Minutes

Audit Committee Meeting


Monday 12 December 2011 at 4:00pm


Queenscliff Town Hall
50 Learmonth Street, Queenscliff

Distribution
Members
Mr. Richard Bull (Chairman)
Mr. Barry Capp
Mr. Roland 'Barney' Orchard
Mr. David Shaw
Cr. John Burgess
Cr. David Mitchell
Officers
Lenny Jenner - Chief Executive Officer
Ev Wuchatsch - General Manager Governance & Community
Allison Chaloner, Senior Accountant
Invitees
Mr David Hutchings – AFS & Associates (Internal Auditor) Borough of Queenscliffe
Minutes of the Audit Committee Meeting 12 December 2011 Page 2 of 16


1. OPENING OF MEETING......................................................................................................... 4
2. PRESENT & APOLOGIES ........ 4
3. PECUNIARY INTEREST & CONFLICT OF INTEREST DISCLOSURES........... 4
4. AUDIT COMMITTEE MEETING - 12 SEPTEMBER 2011 .......................................................... 4
4.1. Confirmation of Minutes ......................................................... 4
4.2 Business Arising from Audit Committee Meeting - 12 September 2011 .................. 5
5. EXTERNAL AUDIT ................................................................................. 5
5.1 Status of Outstanding Actions – External Audit Reports ......... 5
5.2. Victorian Auditor-General’s Report November 2011: Results of the 2010-11 Audits
................................................................................................................................. 5
6. INTERNAL AUDIT .................................................................................................................. 6
6.1. Internal Audit Report – Council Reporting ............................... 6
6.2. Internal Audit Report – Corporate Governance ....................... 6
6.3. Internal Audit Report – Risk Management .............................................................. 6
6.4 Status of Outstanding Actions – Internal Audit Reports .......................................... 7
6.5 Call for Expressions of Interest for the Provision of Internal Audit Services ............ 7
7. INSURANCE AUDITS ............................................................................. 9
7.1. Insurance Audit Report – JMAPP Property .............................................................. 9
7.2. Insurance Audit Report – Fidelity ............................................ 9
7.3. Insurance Audit Report – Liability Mutual ............................. 10
8. REPORTS FROM THE RISK MANAGEMENT COMMITTEE .................................................... 11
8.1 Report on risk management activities for the six months to November 2011 ...... 11
9. INFORMATION TO NOTE .................................................................................................... 14
9.1 2011/12 Quarterly Financial Report as at 30 September 2011 .............................. 14
10. CONFIDENTIAL ITEMS ........ 15
10.1 Confidential Item ................................................................................................... 15
10.2 Confidential Item ... 15
11. RATIFICATION OF CONFIDENTIAL ITEMS ........... 15
12. GENERAL BUSINESS ........................................................................................................... 15
13. AUDIT COMMITTEE MEETING DATES FOR THE 2012 CALENDAR YEAR .............................. 16
14. CLOSE OF MEETING ............ 16

Borough of Queenscliffe
Minutes of the Audit Committee Meeting 12 December 2011 Page 3 of 16


Appendices

Appendix 1 Minutes of the Audit Committee Meeting Under separate cover
12 September 2011
Appendix 2 Status of Outstanding Actions – External Audit Reports Under separate cover
Appendix 3 Victorian Auditor-General’s Report November 2011: Under separate cover
Results of the 2010-11 Audits
Appendix 4 Internal Audit Report – Council Reporting Under separate cover
Appendix 5 Internal Audit Report – Corporate Governance Under separate cover
Appendix 6 Internal Audit Report – Risk Management Under separate cover
Appendix 7 Status of Outstanding Actions – Internal Audit Reports Under separate cover
Appendix 8 Insurance Audit Report – JMAPP Property Under separate cover
Appendix 9 Insurance Audit Report – Fidelity Under separate cover
Appendix 10 Insurance Audit Report – Liability Mutual Under separate cover
Appendix 11 2011/12 Quarterly Financial Report as at Under separate cover
30 September 2011

Borough of Queenscliffe
Minutes of the Audit Committee Meeting 12 December 2011 Page 4 of 16


1. OPENING OF MEETING

Meeting opened at 4:05pm


2. PRESENT & APOLOGIES

Present
Members
Mr. Richard Bull (Chairman)
Mr. Roland ‘Barney’ Orchard
Mr. David Shaw
Cr. John Burgess
Cr. David Mitchell
Officers
Ev Wuchatsch - General Manager Governance & Community
Allison Chaloner, Senior Accountant
Invitees
Mr. David Hutchings, AFS & Associates (Internal Auditor)

Apologies
Mr. Lenny Jenner, Chief Executive Officer
Mr. Barry Capp


3. PECUNIARY INTEREST & CONFLICT OF INTEREST DISCLOSURES

Nil


4. AUDIT COMMITTEE MEETING - 12 SEPTEMBER 2011

4.1. Confirmation of Minutes
(Appendix 1)

Moved: Barney Orchard / Seconded: John Burgess:

That the Minutes of the Audit Committee Meeting held on Monday 12 September 2011 be
confirmed.


Carried

Borough of Queenscliffe
Minutes of the Audit Committee Meeting 12 December 2011 Page 5 of 16


4.2 Business Arising from Audit Committee Meeting - 12 September 2011

Letter received from VAGO in response to Item 4.2.2 Understanding the Audit Matrix


5. EXTERNAL AUDIT

5.1 Status of Outstanding Actions – External Audit Reports

Of the 4 issues remaining in the most recent audit management letter in September 2011, 1 item
has now been completed (sick leave reporting in the new payroll system), two are in progress
(personnel files and I.T. policies/procedures) and one is yet to commence (I.T. strategy). Refer to
Appendix 2 for further details.

Progress, which has seen only 2 items now remaining, will be reviewed by Crowe Horwarth,
Council’s external auditors, at the next interim external audit visit which is expected to take place
in April 2012 after which the completed items can be removed.

Moved: Barney Orchard / Seconded: John Burgess:

That the progress report of outstanding actions from External Audit reports be received.


Carried


5.2. Victorian Auditor-General’s Report November 2011: Results of the 2010-11 Audits

On 23 November 2011, the Auditor-General of Victoria tabled his Acquittal Report: Results of the
2010-11 Audits. The report acquits the final results of the 2010-11 audits, as well as analysing the
quality of financial information and commenting on financial sustainability.

Council officers have reviewed this report by the Auditor-General of Victoria and a summary of the
findings from this report, as they relate specifically to the Borough of Queenscliffe and the council
grouping ‘Small Shires’ within which Council is categorized, is included at Appendix 3.

Recommendation:

That the Council officers report, summarizing the Victorian Auditor-General’s Report November
2011: Results of the 2010-11 Audits, be received.


Borough of Queenscliffe
Minutes of the Audit Committee Meeting 12 December 2011 Page 6 of 16


Moved: Barney Orchard / Seconded: David Shaw:

1. That the Council officers report, summarizing the Victorian Auditor-General’s Report
November 2011: Results of the 2010-11 Audits, be received.

2. That the Audit Committee seeks the Councillor’s opinions as to the use and issues (as a
benchmarking tool) that Council identified in the VAGO report.

NOTED: The concerns relating to “liquidity”


Carried


6. INTERNAL AUDIT

Officers have received and provided management comment, where appropriate, in response to
three internal audit reports issued by AFS & Associates in November 2011 as follows:

6.1. Internal Audit Report – Council Reporting
(Appendix 4)
NOTED: That the Internal Auditor advised that there were no risks identified (relating to
6.1 Internal Audit Report – Council Reporting, Appendix 4.)


6.2. Internal Audit Report – Corporate Governance
(Appendix 5)


6.3. Internal Audit Report – Risk Management
(Appendix 6)

Recommendation:

That the three internal audit reports, including management comment, be received.



Borough of Queenscliffe
Minutes of the Audit Committee Meeting 12 December 2011 Page 7 of 16


Moved: David Shaw / Seconded: Barney Orchard:

1. That the three internal audit reports, including management comment, be received.

2. That the Audit Committee request feedback regarding 6.2, I