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Agenda of Risk & Assurance Committee Meeting

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Agenda of Risk & Assurance Committee Meeting I give notice that a Risk & Assurance Committee Meeting will be held on: Date: Tuesday, 13 July 2021 Time: 10.00am Location: Council Chamber 107 Heuheu Street Taupō AGENDA MEMBERSHIP Chairperson Mr Anthony Byett Deputy Chairperson Cr Anna Park Members Cr Kathy Guy Mr Danny Loughlin Cr John Mack Cr Christine Rankin Mayor David Trewavas Cr John Williamson Quorum 4 Gareth Green Chief Executive Officer Risk & Assurance Committee Meeting Agenda 13 July 2021 Order Of Business 1 Apologies 2 Conflicts of Interest 3 Confirmation of Minutes 3.1 Risk & Assurance Committee Meeting - 16 March 2021 .......................................................... 3 4 Reports 4.1 Receipt of Audit NZ Correspondence - Fees and Draft Audit Plan .......................................... 4 4.2 Project Quantum Status Report ................................................................................................ 5 4.3 Audit of Taupo District Council's Building Consent Authority ................................................... 8 4.4 Review of Risk Management Charter ..................................................................................... 11 4.5 Review of Fraud Policy ........................................................................................................... 14 4.6 Procurement Policy Review .................................................................................................... 17 4.7 Risk & Assurance Committee Schedule of Policies for Review ............................................. 20 5 Confidential Business 5.1 Confirmation of Confidential Portion of Risk & Assurance Committee Minutes - 16 March 2021 ............................................................................................................................. 21 5.2 KPMG Internal Fraud Control Environment ............................................................................ 21 5.3 Litigation Update ..................................................................................................................... 21 Page 2 Risk & Assurance Committee Meeting Agenda 13 July 2021 3.1 RISK & ASSURANCE COMMITTEE MEETING - 16 MARCH 2021 Author: Shainey James, Governance Quality Manager Authorised by: Andrew Peckham, General Manager Corporate RECOMMENDATION(S) That the minutes of the Risk & Assurance Committee meeting held on Tuesday 16 March 2021 be confirmed as a true and correct record. ATTACHMENTS 1. Risk & Assurance Committee Meeting Minutes - 16 March 2021 Item 3.1 Page 3 Risk & Assurance Committee Meeting Agenda 13 July 2021 4.1 RECEIPT OF AUDIT NZ CORRESPONDENCE - FEES AND DRAFT AUDIT PLAN Author: Andrew Peckham, General Manager Corporate Authorised by: Gareth Green, Chief Executive Officer PURPOSE To receive correspondence from Audit New Zealand, along with a presentation from the Appointed Auditor, Mr Leon Pieterse, Audit New Zealand. DISCUSSION Attached for formal receipt are two pieces of correspondence from Audit New Zealand: - Letter to the Mayor, David Trewavas from Leon Pieterse (dated 25 May 2021) – Proposed audit fees for the 30 June 2021 and 30 June 2022 financial years. The letter advises that audit fees are on the increase to better reflect the actual costs incurred by Audit New Zealand (due to staff salary cost movements and actual hours taken to complete the audit) which have, in recent years, been absorbed by Audit New Zealand; and - Proposed Audit Plan dated 25 May 2021 for the Taupō District Council for the year ending 30 June 2021 from the Appointed Auditor, Mr Leon Pieterse, containing a summary of the main focus areas for this year’s audit, being performance reporting, revaluation of assets and fair value movements, progress on the capital works programme, introduction of the new Financial Management Information System via TechOne, and the usual focus on the inherent risk of management override of internal controls. CONCLUSION It is recommended that the Committee receives the information. RECOMMENDATION(S) That the Risk & Assurance Committee: 1. Receives the proposed audit fees letter to the Mayor, David Trewavas from Leon Pieters dated 25 May 2021; and 2. Receives the Audit Proposal dated 25 May 2021 for the year ending 30 June 2021. ATTACHMENTS 1. Proposed Audit Fees for the 30 June 2021 and 30 June 2022 2. Audit Proposal - 30 June 2021 Item 4.1 Page 4 Risk & Assurance Committee Meeting Agenda 13 July 2021 4.2 PROJECT QUANTUM STATUS REPORT Author: Pete Bradshaw, Project Manager Authorised by: John Ridd, General Manager Policy and Strategy PURPOSE To receive an update on the Enterprise Resource Planning (ERP) replacement project (Project Quantum) and Governance Structure. DISCUSSION There are no decisions being sought at this stage, the following update is provided for your information. The project continues to move forward during a period of significant organisational change within TDC. The following is a summary of key achievements since the last report: • The deployment of the finance module has been deferred to October in order to mitigate risks to BAU operations. The project team continue to progress with go-live preparation tasks (e.g. promotion of configuration to production, static data migration and validation, business readiness preparation, etc.) which will simplify live cutover in October. • The ECM (document management) stream is close to doing a first trial data migration which is result of 6 months mapping data across to the new structure. • The Revenue stream is about to begin User Acceptance testing of the new District Valuation Roll provider (Valor) integration. • Business System Analysts are working on configuration of reports, analytics and business process automation. • Some changes to the project’s management structure have taken place with Pete Bradshaw joining the team in a part time Programme Management capacity with responsibility for overall programme delivery. Pete has solid experience working on ERP implementations and his involvement will allow Debbie Hodgson (who will remain actively involved in the project in a full-time capacity) to focus purely on delivery of the Business Solutions elements of the project. Debbie’s continued involvement ensures a level of stability and mitigates the risk of transition. Resourcing continues to be a challenge for the project with recent resignations and the staff re-organisation both impacting the project (see risks below). These challenges are actively being worked through with every effort to minimize impact on project time, cost and quality constraints. Currently, the budget is 72% committed and its estimated we are approximately 70% through the work. Limited project contingency remaining may restrict options to respond to unanticipated scenarios and mitigate associated risks. Item 4.2 Page 5 Risk & Assurance Committee Meeting Agenda 13 July 2021 Below is a summary of the known risks: Risk Theme High, Risk Mitigation Med, Low Time High Recruit replacement BA(s) – at an advanced stage. The current P&R timeline is at risk due to Consider re-allocation of experienced BA to (more the recent resignation of the P&R Business complex) P&R workstream, and assign new BA(s) to Analyst. This is a significant loss of IP and other (more straightforward) workstreams whilst recruitment for a replacement is in Look at options to reduce reliance on key individuals progress it is expected that it will take some time to bring the new resource up to speed. Review project delivery timeline and adjust where necessary. Organisational Change Management High Change planning continues with terms of reference developed to put higher focus on training. This type and scale of Organisational Change Management is new to Taupō Development of internal skills and ownership of District Council and this may impact user change and improvement – leader led approach adoption of the solution and the ability to Training resource secured internally to focus on realise the project benefits creation and delivery of training for Core organisational wide modules. Note: whilst this is now a gap (as highlighted) we are actively looking UPDATE: As a result of the recent re- to recruit a new training resource. organisation and the recall of project resource to BAU, the project currently has Early development and communication of the system no dedicated long term change, comms or familiarisation and training plan as much as practical training resources. This puts pressure on Early involvement of the business in solution design the remaining project team and presents a and configuration to bring them on the journey quality risk. Options to mitigate this risk for the finance module are being explored but a longer-term resource solution will be required for future modules. Resourcing High Team roles identified in advance to ensure right skills on board to deliver project Key Project team roles are not adequately resourced resulting in delays to data Report on capacity and/or capability issues as soon migration, integration, test execution and as identified to Steering reduction in quality due to inability to Contract out key pieces of work as necessary to support the business through other phases. maintain quality and timelines where possible Recruitment freeze during 2020 impacted recruitment for Data migration Lead and Integration/Test leads – this undoubtedly has led to delays to timeline. Resourcing High Project planning considers and avoids periods of peak activity in affected teams Business representatives required for key parts of the project may not be available Key staff
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