The Auditor-General has released a report on the results of statement audits for Local Government Council financials last year, finding only one was qualified.
In her Report on Local Government 2020, Auditor-General Margaret Crawford said 127 Councils, nine County Councils and 13 joint organisation audits in 2019–20 received unqualified audit opinions with the single qualified opinion issued for Central Coast Council.
“Councils were impacted by recent emergency events, including bushfires and the COVID-19 pandemic,” Ms Crawford said.
“The financial implications from these events varied across Councils,” she said.
“Councils adapted systems, processes and controls to enable staff to work flexibly.”
Ms Crawford said there were 1,435 findings reported to Councils in audit management letters with one extreme risk found related to the Central Coast Council’s use of restricted funds for general purposes.
The Auditor-General said 53 high risk matters were identified across the sector, including 21 relating to asset management; 14 to information technology; seven to financial reporting; four to Council governance procedures; three to financial accounting; three to purchasing and payables; and one to cash and banking.
“More can be done to reduce the number of errors identified in financial reports; 61 Councils required material adjustments to correct errors in previous audited financial statements,” she said.
Ms Crawford made two recommendations to the Office of Local Government, that it clarify the legal framework related to restrictions of water, sewerage and drainage funds (restricted reserves) and communicate the State’s view that rural firefighting equipment was controlled by Councils in the Local Government sector, and therefore should be properly recorded in their financial statements.
The Auditor-General’s 84-page Report can be accessed at this PS News link.
