NLC council member says auditor’s report lacking crucial detail

AN NLC council member has said an auditor’s report lacked crucial detail but a competing QC’s report leaked to the NT News rejects alleged office rental ‘conflict of interest’ as ‘commonplace’

Indigenous Affairs Minister Nigel Scullion ordered the NLC to hold full council meeting last month following allegations of “significant governance issues”.

A MEMBER of the full Northern Land Council says an audit report released by the executive ahead of this week’s full council meeting is lacking crucial documentation.

NLC interim chief executive Jak Ah Kit released the report to members, along with a competing QC’s report, on Monday after initially deeming it not “strategically wise” to do so.

But the council member told the NT News, dozens of pages of appendices were held back when the audit report was handed over.

“The audit report I think justifies the calling of the meeting, there’s some serious questions that need to be addressed and answered by the executive,” they said.

“(But) there’s more than 100 letters and supporting documentation (missing) that provides more detail and I don’t think you can come to a really good conclusion if you’ve only got part of the story.”

The council member said they had written to the executive agitating for the release of the missing documents and regarded the QC’s report — previously described by Mr Ah Kit as “scathing” of the auditors — as “lopsided”.

“If it’s meant to be an impartial report I don’t think it comes across as that by a long shot,” they said.

The audit report accused NLC executives of having a conflict of interest involving their directorship of a related entity from which the council rents its Darwin office.

But a copy of the report by Raelene Webb QC seen by the NT News, rejects that assertion, saying only that the “arrangements carry within them real possibilities that conflicts of interest may arise”.

“It is commonplace, particularly in the commercial world, for corporations to have common directors (who may also be substantial shareholders), such that potential conflicts must be managed when those entities negotiate with each other,” Ms Webb wrote.

“The primary duty of such common directors is disclosure of the competing duties and interests.”

The auditors alleged the North Australian Aboriginal Corporation was charging the NLC up to $200,000 a year above market rates for the property.

But Ms Webb found there was “no coherent evidence that the executive council members took any active role on behalf of the NLC in the negotiations”.

“Nor is there any coherent evidence that those members, in their capacity as NAAC directors, took any active role on behalf of NAAC in the negotiations.”

Ms Webb found “the deficiencies in the draft report are such that it could not be given any weight or reasonably be relied upon by either the NLC or the minister”.