The Treasury’s corporate governance framework is designed to:
- maintain effective oversight of the planned activities set out in the Treasury Corporate Plan 2017‑18 and 2017-18 Portfolio Budget Statements;
- be fit-for-purpose and responsive to emerging priorities and risks; and
- ensure the Treasury’s administrative and financial management arrangements comply with statutory and policy including the PGPA Act.
The Executive Committee is the Treasury’s senior leadership group and decision-making body. The Executive Committee sets the Treasury’s strategic policy direction and is the custodian of the Treasury’s reputation. It also supports the Secretary to fulfil his obligations as the Accountable Authority under the PGPA Act. As at 30 June 2018, the Executive Committee comprised the Secretary and Deputy Secretaries.
See Departmental Overview for the Treasury’s senior leadership group.
The Audit Committee reviews the appropriateness of, and provides independent advice to the Secretary on, the department’s performance reporting, financial reporting, risk management and control frameworks. It is established in accordance with section 45 of the PGPA Act and section 17 of the PGPA Rule.
The Audit Committee comprises five members — an independent chair, an internal deputy chair, two independent members and an additional internal member. The Committee met five times in 2017-18. It received regular briefings from the Treasury’s management on changes to the business and risk profiles, and operational and assurance information from business group leads and auditors. The information assisted the Audit Committee to form a view on the Treasury’s compliance with its obligations, together with the ongoing effectiveness of the risk and control frameworks.
A Financial Statements Sub-Committee supports the Audit Committee by providing assurance in regard to the preparation of the Treasury’s financial statements.
Health and Safety Committee
The Health and Safety Committee (HSC) assists the Secretary in carrying out his statutory obligations in accordance with the Work Health and Safety Act 2011. The HSC facilitates cooperation between the Treasury management and employees to develop and review health and safety policies, procedures and initiatives, and manage health and safety risks in the workplace.
Workplace Relations Committee
The Workplace Relations Committee (WRC) is the Treasury’s primary staff consultation body, convened in accordance with the Treasury Enterprise Agreement 2015-18. The WRC undertakes consultation with Treasury staff on issues affecting their working environment and employment conditions.
Inclusive Workplace Committee
The Inclusive Workplace Committee retains strategic oversight of the Treasury’s inclusion and diversity initiatives including Progressing Women; LGBTI+; Family and Domestic Violence; Culturally and Linguistically Diverse; Disability; and Equality and Diversity Networks.
Risk management is fundamental to good governance and integrity, and accordingly the Treasury adopts a ‘risk matters’ culture where risk (threat and opportunity) is viewed as the responsibility of all staff in the pursuit of our purpose and maintenance of our reputation.
The Chief Risk Officer (CRO), as part of the Treasury’s leadership team, fosters a strong risk culture where staff are supported to engage in appropriate risk dialogue. Forums to discuss risks include the Risk Working Group (chaired by the CRO), risk speaker leadership sessions, Group Executive Meetings, and a number of other internal discussion groups. The central risk function guides staff on the documentation and evaluation of risk assessments, and seeks to confirm the existence and operation of treatments and controls, with the assistance of internal audit.
The Treasury’s Risk Management Policy and Framework provides for the capture of significant enterprise-wide and operational risks, with key reflection points provided semi-annually where staff can update the Treasury’s risk profile. Enabling or specialised functions also maintain sub-risk registers to assist them in managing their areas of accountability. Staff understand that risks are to be managed in line with the Treasury’s risk appetite statement and policies.
The Treasury’s framework is consistent with the Commonwealth Risk Management Policy. In 2017‑18, the Treasury released a new risk toolkit and undertook an exercise sponsored by Comcover to enhance the capability of its senior executive to support positive risk management practices and behaviours across the department. For the 2017 calendar year, the Treasury’s maturity rating increased to Integrated in the Comcover Benchmarking Survey, and further enhancements are being progressed in 2018 to further improve our maturity in line with our aspirations.
Fraud prevention and control
The Treasury’s approach to fraud risk management complies with the PGPA Act and Rule and the Commonwealth Fraud Control Framework.
The Treasury has a zero risk appetite for fraud, and has taken comprehensive steps to prevent the occurrence of fraud. These include the development and implementation of the Fraud Corruption and Control Plan 2018-2020, and associated processes and systems for preventing, detecting incidents of, investigating or otherwise dealing with, and recording or reporting fraud. In 2017‑18, the Treasury focussed on educating staff about potential fraud risks, as well as the processes to identify and manage fraud. Fraud awareness is included in onboarding, mandatory security awareness training, financial framework training and a self-paced eLearning course.
The Treasury reports fraud information data annually to the responsible minister and the Australian Institute of Criminology. In 2017‑18 the Treasury did not identify any instances of actual or suspected fraud.
Internal audit arrangements
Internal audit provides independent advice and assurance to the Secretary (through the Audit Committee) on the effectiveness of the Treasury’s governance framework, compliance obligations, and financial and operational controls. Internal audit services were provided by Ernst and Young until May 2018. The Treasury commenced a procurement process to appoint a new internal audit provider.
Internal audit prepares and delivers an annual Internal Audit Plan. The plan is developed in consultation with the Executive Committee and other key departmental stakeholders, so that it reflects our risk profile and assurance concerns. The Audit Committee reviews and endorses the plan, for approval by the Secretary.
Delivery of the plan is viewed as an important mechanism to assist management in their oversight of inherent and emerging risks, and to support continuous business improvement. In 2017‑18, internal audit delivered performance, compliance and systems audits with a focus on credit cards, foreign investment functions, model integrity and management, the shared services operating framework, virtual desktop infrastructure, and fraud control and corruption.
The Treasury has policies and procedures in place to ensure appropriate ethical standards, including the APS Code of Conduct and Values, are upheld in accordance with the Public Service Act 1999.
The Treasury provided input into the annual APS State of the Service Report in accordance with section 44 of the Public Service Act 1999.
SES remuneration is determined under section 24(1) of the Public Service Act 1999. Further information is provided at Part 3 — Management of human resources section on page 53.
Significant non-compliance issues with relevant finance laws
There were no significant instances of non-compliance with the finance law reported to the responsible minister in 2017‑18.