Administration of grants by local governments Presented by: Steve Mitsas, Victorian Auditor-General’s Office December

1. Administration of grants by local governments Presented by: Steve Mitsas, Victorian Auditor-General’s Office December 2005 Auditing in the Public Interest

2. Audit objectives and scope • To assess whether 5 selected councils had: • adequate policies and controls for grants administration • complied with their policies, controls and legislation • The results – mixed ! Auditing in the Public Interest

3. Key aims of sound grants administration • Achieve corporate objectives • Open, fair, consistent and transparent process • Value for money (maximum outcomes) • Risk management (process and outcomes) • Compliance with policy and legislation Auditing in the Public Interest

4. Key strengths of current frameworks • ‘Front-end’ process generally sound! • clear program aims • clear and well communicated eligibility criteria • well documented assessment process • grant agreements mostly prepared and comprehensive (including acquittal requirements) Auditing in the Public Interest

5. Some good practices • IT grant administration system (Knox) • Conflict of interest declarations and register (knox) • Training programs/review workshops (Moreland) • Annual review/evaluation of grant rounds (Moreland and Wangaratta) • Annual council auditing of sample of grants (Moreland) Auditing in the Public Interest

6. Areas needing improvement – our observations • Formal admin. processes not established for other than community grant programs (eg: donations, sponsorships etc) • No evidence that risks re: grant types and recipients were effectively assessed • Conflicts of interest not well addressed/managed • Little evidence of staff training Auditing in the Public Interest

7. Areas needing improvement – our observations (cont) • Variable grant monitoring and acquittal documentation • Program outcomes/effectiveness not regularly evaluated • Completeness and accuracy of ‘grants and donations’ lists (as required by regulation) varied! Auditing in the Public Interest

8. 4 strategic improvement areas – an action plan • Implement a comprehensive and consistent framework for all forms of financial support to 3rd parties - this will require a broader definition of ‘grants’ • Develop good understanding of risks re: the different ‘grant ‘ types and recipients, and apply this to design the risk-based monitoring and acquittal regimes • Keep adequate documentation to demonstrate actions and decisions taken • Maintain the records required by regulation and legislation Auditing in the Public Interest

9. The suggested next steps • Assess your agency’s policies and procedures against our audit criteria/findings • Develop an action plan to address any areas for improvement, and implement it • Review progress against the action plan in 12 months time Auditing in the Public Interest

10. Thank You ! Auditing in the Public Interest