Audit Committee Minutes - 8 May 2012 - District Council of Elliston

DISTRICT COUNCIL OF ELLISTONAUDIT COMMITTEE MINUTESTuesday, 8 th May 201212:30pm1. PRESENTCommittee Members: Cr Peter Hitchcock (Chairman), Cr Creagh McGlasson, Mr Allen Bolaffi(Independent Member)Staff in attendance: Mary Deakin (CEO), Nikki Meredith (Senior Finance Officer)Councillors in attendance: (No Voting Right): Cr P Clark, Cr K Callaghan.2. APOLOGIESCr Tim Schlink, and Jo-Ann Tanti (Independent Member – CSM DC Streaky Bay)3. WELCOMEThe Chairman presided over the meeting and declared the Audit Committee Meeting open at12.40pm and welcomed Committee members and observer elected members to the meeting.4. CONFIRMATION OF MINUTES FROM PREVIOUS MEETINGResolution:That the Minutes of the Audit Committee meeting held on 14 th February 2012, as circulated andtabled in the minute book be taken as read and confirmed.5. ANNUAL BUSINESS PLAN AND BUDGETPage 1Cr Creagh McGlasson / Mr Allen BolaffiCARRIED5.1. Annual Business Plan Working Document was tabled for discussion.The major changes to the format from the 2011 / 2012 Annual Business Plan and Budgetwere explained and discussed.Differential rating according to land use zones was discussed.It was decided that further analysis on the Council’s Rating Methodology was required andalso to investigate the methodology used by other councils in order to ascertain whether thecurrent rating system was in line with current practices.Further to that, the impacts of differential rating on zones be investigated.

Mr Bolaffi raised the requirement within the Business Plan and Budget to address theapproach that Council will be taking in considering the impact of Carbon Tax on the Budgetand Councils approach to its effect on revenue and expenditure.The proposed changes to charges for water supply to Port Kenny were discussed. It wasagreed to in principle to recommend to Council and noted that public consultation wasrequired for any changes to the rating methodologies.5.2. Local Government Act 1999 Extract was provided for information.5.3. Annual Business Plan and Budget Schedule2012 / 2013 Business Plan & Budget – Consultation Strategy was tabled and discussed.Resolutions:1. That the Draft Annual Business Plan be recommended to Council for consideration. Itwas noted that the budget document has yet to be tabled2. That Audit Committee endorse the Annual Business Plan and Budget – ConsultationStrategy and that it be recommend to Council for consideration.6. ANNUAL BUSINESS PLAN AND BUDGET POLICYCr Creagh McGlasson / Mr Allen BolaffiCARRIED6.1. The Annual Business Plan and Budget Policy was presented to the Audit Committeemembers for consideration. In accordance with Part 2 of the Local Government Act 1999,and the Local Government Financial Management Regulations, Council must adopt a policyon budget preparation, regular budget reviews and reporting annual financial outcomes.Resolution:1. That the Annual Business Plan and Budget Policy be recommended to Council foradoption.Cr Creagh McGlasson / Mr Allen BolaffiCARRIED7. PERFORMANCE IMPROVEMENT TOOL7.1. The results of a Good Governance Audit and a Continuous Improvement Audit, undertakenby Trevor and Sandie Starr through the Local Government Association of Australia, waspresented to and discussed by the Audit Committee.The negative results were due to the staff changes and other matters.The current administration with the guidance of the Audit Committee will progress thedevelopment of the improvement plan and monitor the progress of Council.Resolution:1. That the corrective action plan / register will be developed by senior staff to address thenon-compliances in order of priorities and consideration of the organisational risks.2. That the register will be provided to the Audit Committee for information and a progressreport will be provided within six months.Cr Creagh McGlasson / Mr Allen BolaffiCARRIEDPage 2

8. COMMUNITY SUPORT POLICY8.1. Community Support Policy was presented for discussion to the Audit Committee. AuditCommittee reviewed the Policy to ensure that within Council Policy there was sufficientaccountability and governance on the organisations that were receiving support fromCouncil by way of loans or grants and addressed various issues that may present risk to theCouncil of non payment of loans.Resolution:1. That the Community Grants Policy and application form be reviewed at the CouncilWorkshop prior to being presented to Council.9. INFORMATION PAPERSCr Creagh McGlasson / Mr Allen BolaffiCARRIED9.1. Financial Sustainability Information Paper 3 – Audit Committees was presented to AuditCommittee for discussion and consideration.The Information Paper included the following attachments which can be used by Councilsas a model:Attachment 1: Model Terms of Reference for an Audit CommitteeAttachment 2: Model Work Program for a Council’s Audit CommitteeAttachment 3: Model Audit Committee Annual Report to CouncilThe Committee discussed Audit Committee membership and the suggestion of thenomination of an elected member as a proxy for the Audit Committee elected members inthe event that an elected member as a member of the committee is unavailable.Resolution:1. That the Audit Committee adopt the model LGA work program and that it be used as abasis for the development of the District Council of Elliston’s Audit Committee workprogram for 2012/13.2. That the Terms of Reference for the Audit Committee be reviewed by management andthe model LGA Terms of Reference be used as a guide.3. That the reviewed Terms of Reference be presented to a future meeting of the AuditCommittee for recommendation to Council.4. That the Model Audit Committee Annual Report to Council be used for development ofthe Audit Committees Annual Report for presentation to Council in November 2012.Cr Creagh McGlasson / Mr Allen BolaffiCARRIEDPage 3

9.2. Financial Sustainability Information Paper 27 – Prudential ManagementThe Information Paper 27 – Prudential Management which was developed by the LGA wasdiscussed by the Audit Committee.Recommendation:1. That management prepare a Prudential Management Policy based on the LGA modelPrudential Policy and that it be presented at a future meeting.Cr Creagh McGlasson / Mr Allen BolaffiCARRIED9.3. Audit Committee Terms of Reference was presented and discussed with recommendedchanges to be made. Refer to discussion in item 9.19.4. Valuation Commentary 2012 / 2013 DC EllistonValuation information provided by the Valuer Generals Office was provided for informationto the Audit Committee. This was also included in the Business Plan and Budget document.10. OTHER BUSINESS10.1. Register of Resolutions – it was requested by Cr Hitchcock that a register ofresolutions be developed and made available to Council.10.2. Allen Bolaffi raised the issue of implementation of internal control documentationfor financial controls in the Council. This was a requirement of larger city councils andwould be a focus in the future for country councils. He recommended that Council plan forthe implementation now and show leadership in the region.11. NEXT MEETINGThe next ordinary meeting for the Audit Committee Meeting will be held on Tuesday 14 TH August2012 at 12:30 in the Elliston Council Chambers.12. CLOSEThe meeting closed at 2:20pm after the Chairman thanked all for attending.Page 4

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