Governance Statements – Reflections on the first year

1. Governance Statements – Reflections on the first year Colette Kane Northern Ireland Audit Office Promoting better use of public money

2. Scope of Review • 140+ Governance Statements reviewed during audit • Attendance at audit committees • Reviewed departments and a number of other bodies • Examined; • how essential features were met within the Governance Statements; • the process followed in preparing statements; and • whether the overall aim of the Governance Statement had been achieved.

3. Governance Statements The governance statement should reflect the organisation’s governance, risk management and internal control arrangements and how they operate in practice. The Governance Statement should provide a sense of the organisation’s vulnerabilities and resilience to challenges.

4. What we found • A substantial amount of time had been invested. • Audit Committees were involved. • Essential features were included. • Disclosures were tailored.

5. DCAL; ‘Risks relating to the delivery of the City of Culture reflect issues in respect of sponsorship income, legacy planning and benefits realisation. The Department is currently working with Derry City Council to manage these risks’ DARD; During 2012, a new strategic risk was identified, when the presence of Chalarafraxinea, a fungal pathogen causing ash dieback disease, was confirmed in Northern Ireland. Further details of the mitigating actions taken as a result of this are included in the Operating Review section of this Annual Report.

6. What we found • A substantial amount of time had been invested. • Audit Committees were involved. • Essential features were included. • Disclosures were tailored. • The use of diagrams and tables.

7. NIAO Advisory Board NIAO Audit Committee C&AG Executive Team Directorate Forum Communication flows

9. What we found • A substantial amount of time had been invested. • Audit Committees were involved. • Essential features were included. • Disclosures were tailored. • The use of diagrams and tables. • Evidenced based disclosures

10. Forest Service Agency on Board’s performance; ‘The Board carried out a formal review of its effectiveness based upon confidential questionnaires completed by all members..’

11. What we found • A substantial amount of time had been invested. • Audit Committees were involved. • Essential features were included. • Disclosures were tailored. • The use of diagrams and tables. • Evidenced based disclosures. • Arms length bodies control issues highlighted.

12. Key Recommendations • More concise and less repetitive • Focus more on the assessment of risk and particularly where risks have materialised and how these were addressed. • New risks identified should be disclosed.

13. Public Prosecution Service; ‘One risk was added during the year (in respect of the inexperience of new staff). This was in response to the number of new legal staff recruited, including temporary appointments, as well as the use of temporary promotion to fill senior posts’

14. Key Recommendations • More concise and less repetitive • Focus more on the assessment of risk and particularly where risks have materialised and how these were addressed. • New risks identified should be disclosed. • Board performance and effectiveness. • Information on the quality of the information to the Board and why the Board finds it acceptable. • Specific reference to security lapses.

15. And finally... • New Code of Corporate Governance applicable for 2013-14 onwards. • Comply or explain. • Additional disclosure if any identified conflicts of interest or potential conflicts for Board members and how managed. • NIAO will continue to assist with advice and guidance!