Reports
Regional NSW 2020
This report analyses the results of our audits of financial statements of entities within the Regional NSW cluster for the year ended 30 June 2020. The table below summarises our key observations and recommendations.
1. Machinery of Government (MoG) changes |
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| Creation of Regional NSW cluster | MoG changes on 2 April 2020 created the Department of Regional NSW (the Department). The Department of Planning, Industry and Environment (DPIE) staff employed in the Regions, Industry, Agriculture and Resources Group, together with associated functions, assets and liabilities were transferred to the new Department. A number of agencies moved from the Planning, Industry and Environment cluster to the new Regional NSW cluster. The Department deals with major issues affecting regional communities, including the coordination of support for people, businesses and farmers who have faced drought, bushfires, flood and the COVID-19 pandemic. |
| The Department is still in the process of implementing changes | The Department continues to receive corporate services support from DPIE. The Department has indicated it will transition to its own policies and procedures by June 2021. |
2. Financial reporting |
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| Audit opinions | Unqualified audit opinions were issued for all cluster agencies' 30 June 2020 financial statements audits. |
| Timeliness of financial reporting | Nine of the ten cluster agencies subject to statutory reporting deadlines met the revised timeline for submitting the financial statements. The Department and a number of cluster agencies obtained NSW Treasury’s approval to delay submission of their 30 June 2020 financial statements due to delays resulting from accounting and administrative complexities created by the Machinery of Government changes that separated the Department from DPIE. The deadlines were moved from 5 August 2020 to either 10 August 2020 or 12 August 2020. New South Wales Rural Assistance Authority missed the revised deadline by one day. All agencies that were required to perform early close procedures had met the revised timeline. Due to issues identified during audit, four financial statements audit were not completed and audit opinions issued by the statutory deadline. |
| New accounting standards |
Agencies implemented three new accounting standards during the year. Our audit of the Department identified there was a lack of quality assurance over the accuracy of lease information provided by Property NSW. Recommendation: The Department should:
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3. Audit observations |
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| Internal control deficiencies |
We identified 30 internal control issues, including 16 findings that were raised with former agencies in previous years. Two matters from previous years have been elevated to high risk during 2019–20. Both matters related to Local Land Services:
Recommendation: Management letter recommendations to address internal control weaknesses should be actioned promptly, with a focus on addressing high-risk and repeat issues. |
| Agency responses to emergency events | The Department's executive leadership committee along with support from DPIE crisis management team managed the recovery from the bushfires and impact of COVID-19. Social distancing and other infection control measures were put in place. The Forestry Corporation of New South Wales accelerated a fire salvage timber program in response to the bushfire emergency. The Department and cluster agencies received additional funding for bushfire recovery and COVID-19 pandemic response. |
The Regional NSW cluster aims to respond to regional issues, creating and preserving regional jobs, driving regional economy, growing existing and supporting emerging industries. The key areas of focus across the New South Wales (NSW) State is shown below:
MoG changes impact on Department of Regional NSW
The Department was created as result of the MoG changes during 2019–20. The Administrative Arrangements Order 2020, effective on 2 April 2020 created the Department of Regional NSW. These changes had a significant administrative impact on the cluster agencies. The MoG change resulted in a transfer of net assets ($446 million) and budget ($284 million) from DPIE to the newly created Department of Regional NSW on 2 April 2020. A summary of the MoG impacts on the Regional NSW cluster is shown below.
Financial reporting is an important element of good governance. Confidence and transparency in public sector decision making are enhanced when financial reporting is accurate and timely.
The COVID-19 Legislation Amendment (Emergency Measures–Treasurer) Act 2020 amended legislation administered by the Treasurer to implement further emergency measures as a result of the COVID-19 pandemic. These amendments:
- allowed the Treasurer to authorise payments from the consolidated fund until the enactment of the 2020–21 budget – impacting the going concern assessments of cluster agencies
- revised budgetary and financial and annual reporting time frames – impacting the timeliness of financial reporting
- exempted certain statutory bodies and departments from preparing financial statements.
This chapter outlines our audit observations related to the financial reporting of agencies in the Regional NSW cluster for 2020, including any financial implications from the recent emergency events.
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Section highlights
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Appropriate financial controls help ensure the efficient and effective use of resources and administration of agency policies. They are essential for quality and timely decision making.
This chapter outlines our:
- observations and insights from our financial statement audits of agencies in the Regional NSW cluster
- assessment of how well cluster agencies adapted their systems, policies and procedures, and governance arrangements in response to recent emergencies.
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Section highlights
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Appendix one - List of 2020 recommendations
Copyright notice
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Family and Community Services 2016
The Family and Community Services report was released today by the Acting Deputy Auditor-General. Financial reporting within the cluster continues to improve but there are opportunities to improve governance and performance reporting.
Volume Six 2011 focus on Environment, Water and Regional Infrastructure
The Environment Protection Authority’s expenditure for the financial year 2010/11 was $92 million - $76 million of this was for environment protection and regulation. The Office of Environment and Heritage and the Environment Protection Authority commenced 145 prosecutions for environmental offences and 106 were completed in the financial year 2010/11, down from the 134 prosecutions completed in 2009/10. Financial penalties for 2010/11 totalled $969,000 down from $1,403,000 in 2009/10. The average fine decreased from $10,468 in 2009/10 to $9,141 in 2010/11.
Volume One 2011
The level of non compliance with the requirements of this Premier’s Memorandum is concerning, particularly considering the NSW Procurement Reforms were effective since 2006. The implementation strategy for procurement reform was announced as early as 2001. We recommend the governing bodies of agencies and management review, not only the processes their agencies have in place to comply with procurement reforms and requirements, but also more broadly how agencies identify and comply with laws, regulations, Treasury policy pronouncements, Premier’s memoranda and other obligations.
