$17million shortfall since removal of overseeing committee
The North Burnett Regional Council has been told it needs to bring reinstate a financial watchdog, two years after it decided one wasn’t needed.
Central & North Burnett
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North Burnett Regional Council has been forced to backflip on its decision to axe its financial watchdog as the organisation continues to haemorrhage money.
The council voted to abolish the audit and risk committee in November 2020, but brought it back this week after it was found by the state’s chief auditor to be financially unstable.
The backflip arises from the fact since the committee was dissolved the council has reported a total operating deficit of more than $17.2million.
This shortfall has led to the council being labelled “financially unstable” and the recommendation has come from the Queensland Audit Office as “ it is considered a prudent measure while Council’s financially sustainability is at risk”.
In the two years since getting rid of the auditing committee, the NBRC has saved about $10,000 ($5000 a year); a meagre amount when balanced against the massive shortfalls exhibited since the last profitable year in 2016.
Minutes from the November 2020 meeting reveal councillors felt the control measures suggested by yearly external auditors was “sufficient”.
The 2020 minutes did not outline where the $5000 yearly saving was to be reallocated after the committee’s dissolution, and its re-establishment has not been considered in this year’s budget.
Position advertisement for the new committee will be done as early as December 2022, and the NBRC aims to fill four spots with external members who have experience in areas such as risk assessment and financial reporting.
Council financial services manager, Owen Jensen, has proposed the “the committee would also assist with more robust corporate governance and risk considerations across the organisation through independent oversight and monitoring”.
The reinstated committee will provide oversight and advice to the council and its CEO on matters such as fraud, corruption, risk management and financial management.
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