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Finance and Assurance Committee
22 June 2020
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1 Apologies
There were was an apology for lateness from Councillor Byars.
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Moved Chairperson
Robertson, seconded Cr Douglas and resolved:
That the Finance and Assurance Committee accept the apology.
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2 Leave
of absence
There were no requests for leave of absence.
3 Conflict
of Interest
There were no conflicts of interest
declared.
4 Public
Forum
There was no public forum.
(Councillor Duffy joined the meeting at 9.02am.)
5 Extraordinary/Urgent
Items
There were no Extraordinary/Urgent items.
(Councillor Byars joined the meeting at 9.03am.)
6 Confirmation
of Minutes
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Resolution
Moved
Chairperson Robertson, seconded Deputy Chairperson Kremer and resolved:
That the
Finance and Assurance Committee confirms the minutes of the meeting held on
30 April 2020 as a true and correct record of that meeting.
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Reports
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7.1
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Finance & Assurance
Committee Work plan for the year ended 30 June 2020
Record No: R/20/6/15106
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Chief
Financial Officer – Anne Robson was in attendance for this item.
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Resolution
Moved Chairperson Robertson,
seconded Mayor Tong and resolved:
That
the Finance and Assurance Committee:
a) Receives
the report titled “Finance & Assurance Committee Work plan for the
year ended 30 June 2020” dated 16 June 2020.
b) Notes
the changes made to the Finance and Audit Committee Work plan for the year
ended 30 June 2020 since the last meeting.
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7.2
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Engagement Letter -
Limited Independent Assurance Report of the debenture trust deed
Record No: R/20/5/11656
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Graduate
Accountant – Brie Lepper and Financial Accountant – Sheree Marrah
were in attendance for this item. Audit New Zealand Audit Director
Dereck Ollsson was in attendance via zoom.
Miss
Lepper advised that the purpose of the report was to provide an
overview and seek authorisation of Audit New Zealand’s engagement
letter for the limited independent assurance report of Council’s
debenture trust deed.
The Committee noted
that the Audit New Zealand requires Council to confirm the terms of its
engagement for the limited independent assurance report of Council’s
debenture trust deed, by way of an engagement letter.
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Resolution
Moved Cr Keast, seconded Deputy
Chairperson Kremer and resolved:
That
the Finance and Assurance Committee:
a) Receives
the report titled “Engagement Letter - Limited Independent Assurance
Report of the debenture trust deed” dated 16 June 2020.
b) Determines
that this matter or decision be recognised as not significant
in terms of Section 76 of the Local Government Act 2002.
c) Determines
that it has complied with the decision-making provisions of the Local
Government Act 2002 to the extent necessary in relation to this decision; and
in accordance with Section 79 of the act determines that it does not require
further information, further assessment of options or further analysis of
costs and benefits or advantages and disadvantages prior to making a decision
on this matter.
d) Authorises
the Mayor to sign the Audit New Zealand engagement letter for the limited
independent assurance report of the debenture trust deed on Council’s
behalf.
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7.3
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Audit Engagement Letters
Record No: R/20/5/11659
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Financial
Accountant – Sheree Marrah was in attendance for this item. Audit
New Zealand Audit Director Dereck Ollsson was in attendance via zoom.
Mrs
Marrah advised that the purpose of the report was to receive the
proposal and audit engagement letters from Audit NZ, to conduct the audit of
Council on behalf of the Auditor-General for the 2020, 2021 and 2022
financial years and to consider accepting the fee proposed in regards to the
2020 year and the terms of the audit including Councils responsibilities for
the years ended 30 June 2020, 2021 and 2022.
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Resolution
Moved Chairperson Robertson,
seconded Cr Douglas and resolved:
That
the Finance and Assurance Committee:
a) Receives
the report titled “Audit Engagement Letters” dated 16 June 2020,
b) Determines
that this matter or decision be recognised as not significant
in terms of Section 76 of the Local Government Act 2002,
c) Determines
that it has complied with the decision-making provisions of the Local
Government Act 2002 to the extent necessary in relation to this decision; and
in accordance with Section 79 of the act determines that it does not require
further information, further assessment of options or further analysis of
costs and benefits or advantages and disadvantages prior to making a decision
on this matter,
d) Receives
the proposal from Audit NZ to conduct the audit of Council on behalf of the
Auditor-General for the 2020, 2021 and 2022 financial years
e) Receives
the Audit engagement letter from Audit NZ for the 2020, 2021 and 2022
financial years
f) Accepts
the proposed 1.5% audit fee increase of $1,775 for the audit of the annual
report for the year ended 30 June 2020, resulting in an overall audit fee of
$120,124 excl GST plus actual disbursements for the year ended 30 June 2020.
g) Accepts
the terms of the engagement for the audit of the annual report for the 2020,
2021 and 2022 financial years.
h) Agrees
to enter into discussions with Audit NZ in relation to the audit of Councils
annual report for the years ended 30 June 2021 and 2022
i) Authorises
the Mayor to sign the following letters received from Audit NZ,
- proposal
to conduct the audit of Southland District Council on behalf of the Auditor
General for the 2020, 2021 and 2022 financial years,
- audit
engagement letter.
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7.4
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Interim Management
Report from Audit New Zealand for the year ended 30 June 2020
Record No: R/20/5/11689
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Financial
Accountant – Sheree Marrah was in attendance for this item. Audit
New Zealand Audit Director Dereck Ollsson was in attendance via zoom.
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Resolution
Moved Deputy Chairperson Kremer,
seconded Cr Keast and resolved:
That
the Finance and Assurance Committee:
a) Receives
the report titled “Interim Management Report from Audit New Zealand for
the year ended 30 June 2020” dated 16 June 2020.
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7.8
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Quarterly risk management report - June 2020
Record No: R/20/5/10858
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Policy
Analyst – Jane Edwards was in attendance for this item.
Mrs
Edwards advised that the purpose of the report was to advise of the June
2020 Quarterly Risk Management Report for consideration by the Committee and
for the committee to agree to the report being considered by Council for the
adoption of the Council’s revised top strategic risks, to become
effective on 1 July 2020.
The Committee noted
that risk management is about identifying events that may occur in the future
that will have an impact on Council’s objectives. Council’s
approach to risk management involves four key steps:
a) identifying
the risk
b) evaluating
the severity of any identified risks
c) applying
possible solutions to those risks
d) monitoring
and analysing the effectiveness of any subsequent steps taken.
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Resolution
Moved Deputy Chairperson Kremer,
seconded Cr Duffy and resolved:
That
the Finance and Assurance Committee:
a) Receives
the report titled “Quarterly risk management report - June 2020”
dated 16 June 2020.
b) Determines
that this matter or decision be recognised as not significant
in terms of Section 76 of the Local Government Act 2002.
c) Determines
that it has complied with the decision-making provisions of the Local
Government Act 2002 to the extent necessary in relation to this decision; and
in accordance with Section 79 of the act determines that it does not require
further information, further assessment of options or further analysis of
costs and benefits or advantages and disadvantages prior to making a decision
on this matter.
d) Considers
and gives feedback on the revised priority weightings
e) Notes
that the addition of an emergent risk and elevation of a previously lower
ranked risk to the top ten strategic risks displaces the two lowest ranking
risks on the current register
f) Recommends
that Council adopt the revised top strategic risks as follows to become
effective 1 July 2020:
1. Inaccurate
data leads to bad decisions/asset failure
2. Underinvestment
in infrastructure
3. Infrastructure
not fit for purpose to withstand climate change
4. Inadequate,
incomplete or lack of strategy/policy impacts the wellbeing of the District
5. Natural
or biosecurity event impacts the wellbeing of the District
6. Health
and safety controls fail to protect staff and contractor safety
7. Financial
conservatism constrains progress towards strategic objectives
8. Difficulty
retaining or recruiting staff affects service levels
9. Over-commitment
leads to inability to deliver agreed work programme
10. Growth
and demand dependent model makes it hard to fund new infrastructure.
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(The meeting adjourned for morning tea at
10.28am and reconvened at 10.45am.)
(Bruce Robertson (Chair), Mayor Tong and
Committee members were all present when the meeting reconvened.)
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7.5
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Draft Annual Plan
2020/2021
Record No: R/20/5/11773
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Corporate
Performance Lead – Jason Domigan and Financial Accountant –
Sheree Marrah were in attendance for this item.
Mr
Domigan advised that the purpose of the report is for the Finance and
Assurance committee to review the final draft of the Annual Plan 2020/2021
and recommend to Council its adoption.
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Resolution
Moved Deputy Chairperson Kremer,
seconded Cr Douglas recommendations a
to c, d with changes (identified with strikethrough and underline)
and e to I and resolved:
That
the Finance and Assurance Committee:
a) Receives
the report titled “Draft Annual Plan 2020/2021” dated 16 June
2020.
b) Determines
that this matter or decision be recognised as significant in
terms of Section 76 of the Local Government Act 2002.
c) Determines
that it has complied with the decision-making provisions of the Local
Government Act 2002 to the extent necessary in relation to this decision; and
in accordance with Section 79 of the Act determines that it does not require
further information, further assessment of options or further analysis of
costs and benefits or advantages and disadvantages prior to making a decision
on this matter.
d) Confirms
in accordance with Section 100 of the Local Government Act 2002 that the
Annual Plan 2020/2021 has been prepared based on reasonable judgement and
assumptions and that it the Committee considers the projected
financial results, including the projected operating deficit for 2020/2021,
to be financially prudent given its Councils financial
position.
e) Confirms
the reduction of the Te Anau Airport Manapouri rate from $128.00 (incl GST)
to $67.69 (incl GST). Noting this reduction is being done by extending
the airport loan by one year and deferring the 2020/2021 airport loan
repayment and by funding the interest charge by adding it to the airport loan
balance to be repaid over the life of the loan.
f) Acknowledges
that resolution (e) above, is inconsistent with Council’s Revenue and
Financing policy as it is funding an operational cost from a loan.
Accordingly Council recognise that this as an inconsistent decision made in
accordance with section 80 of the Local Government Act 2002.
g) Notes
that resolution e above is in response to the potential financial impact of Covid-19
on affordability of rates, particularly in the Fiordland rating
area. A review of the Revenue and Financing policy will be undertaken
as part of Council’s 2021-2031 Long Term Plan, but at this stage there
are no plans to alter the policy to generally allow the funding of
operational costs from loans.
h) Recommends
to Council the adoption of the Annual Plan 2020/2021, including the Funding
Impact Statement (Rates section) for the 2020/2021 financial year.
i) Recommends
to Council that a copy of the finalised fees and charges booklet be made
available on Council’s website and be distributed to relevant
stakeholders, Hall Committees and Community Boards for their information.
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7.6
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Annual Report 2019/2020
- Key dates
Record No: R/20/5/11775
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Corporate
Performance Lead – Jason Domigan and Financial Accountant –
Sheree Marrah were in attendance for this item.
Mr
Domigan advised that the purpose of the report was provide the
committee with the key dates for the Annual Report 2019/2020.
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Resolution
Moved Chairperson Robertson,
seconded Cr Keast and resolved:
That
the Finance and Assurance Committee:
a) Receives
the report titled “Annual Report 2019/2020 - Key dates” dated 16
June 2020.
b) Notes
the Annual Report 2019/2020 - key dates as per attachment A, being:
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7.7
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Accounting Policies for
the year ended 30 June 2020
Record No: R/20/5/11691
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Graduate
Accountant – Brie Lepper and Financial Accountant – Sheree Marrah
were in attendance for this item.
Miss
Lepper advised that the purpose of the report was to consider and
recommend to Council the adoption of the accounting policies to be used to
compile the Council’s annual report for the year ended 30 June 2020.
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Resolution
Moved Mayor Tong, seconded Cr Duffy
and resolved:
That
the Finance and Assurance Committee:
a) Receives
the report titled “Accounting Policies for the year ended 30 June
2020” dated 16 June 2020.
b) Determines
that this matter or decision be recognised as not significant
in terms of Section 76 of the Local Government Act 2002.
c) Determines
that it has complied with the decision-making provisions of the Local
Government Act 2002 to the extent necessary in relation to this decision; and
in accordance with Section 79 of the Act determines that it does not require
further information, further assessment of options or further analysis of
costs and benefits or advantages and disadvantages prior to making a decision
on this matter.
d) Recommends
to Council that the accounting policies as outlined in Attachment A,
including any amendments from this meeting, be adopted for use in preparation
of the Council’s Annual Report for the year ended 30 June 2020.
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7.9
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New Zealand Transport
Agency investment audit report for the period 2017/2018 to 2019/2020
Record No: R/20/6/14112
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Strategic
Manager Transport – Hartley Hare was in attendance for this item.
Mr
Hare advised that the purpose of the report was to report to the Committee on
the New Zealand Transport Agency investment audit with is required to be
undertaken every three years to ensure that the investment in Southland
District Council’s land transport programme is being well managed and
delivering value for money.
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Resolution
Moved Cr Douglas, seconded Mayor
Tong and resolved:
That
the Finance and Assurance Committee:
a) Receives
the report titled “New Zealand Transport Agency investment audit report
for the period 2017/2018 to 2019/2020” dated 16 June 2020.
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7.10
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Monthly Financial Report
- April 2020
Record No: R/20/6/12832
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Project
Accountant – Dee Patel was in attendance for this item.
Mrs
Patel advised that the purpose of the report was to to provide Council
with an overview of the financial results to date by the nine activity groups
of Council, as well as the financial position, and the statement of cash
flows.
The Committee noted
that the report summarised the financial results for the ten months to 30
April 2020.
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Resolution
Moved Chairperson Robertson,
seconded Mayor Tong and resolved:
That
the Finance and Assurance Committee:
a) Receives
the report titled “Monthly Financial Report - April 2020” dated 16
June 2020.
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7.11
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Health and Safety Update
Record No: R/20/6/13331
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People
and Capability Manager – Janet Ellis was in attendance for this item.
Mrs
Ellis advised that the purpose of the report was to update the Committee on
health and safety at Council for the period 1 January to 31 May 2020.
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Resolution
Moved Deputy Chairperson Kremer,
seconded Cr Keast and resolved:
That the Finance
and Assurance Committee:
a) Receives
the report titled “Health and Safety Update” dated 11 June 2020.
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The
meeting adjourned for lunch at 12.17pm and reconvened at 12.47pm.)
(Bruce
Robertson (Chair), Mayor Tong and Councillors Douglas, Duffy, Keast and Kremer
were present when the meeting reconvened.)
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7.12
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Draft Health and Safety
Plan for 2020/21
Record No: R/20/6/13328
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People
and Capability Manager – Janet Ellis and Health, Safety and Wellbeing
Advisor – Teri Black were in attendance for this item.
Mrs
Ellis advised that the purpose of the report was to seek approval for
the draft Health and Safety Plan 2020/2021 to be presented to Council for
formal approval.
(Councillor Byars
returned to the meeting at 12.52pm.)
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Resolution
Moved Chairperson Robertson,
seconded Deputy Chairperson Kremer and
resolved:
That
the Finance and Assurance Committee:
a) Receives
the report titled “Draft Health and Safety Plan for 2020/21”
dated 16 June 2020.
b) Determines
that this matter or decision be recognised not significant in
terms of Section 76 of the Local Government Act 2002.
c) Determines
that it has complied with the decision-making provisions of the Local
Government Act 2002 to the extent necessary in relation to this decision; and
in accordance with Section 79 of the Act determines that it does not require
further information, further assessment of options or further analysis of
costs and benefits or advantages and disadvantages prior to making a decision
on this matter.
d) Recommends
to Council that it approves the Health and Safety Plan for 2020/2021.
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Public
Excluded
Exclusion of the Public: Local Government
Official Information and Meetings Act 1987
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Resolution
Moved Cr Douglas,
seconded Mayor Tong and resolved:
That the public be excluded from the
following part(s) of the proceedings of this meeting.
C8.1 Annual Insurance Renewal
C8.2 Deloitte Fraud Risk Assessment
C8.3 Operational Risk Report
The general subject of each matter to be considered while the
public is excluded, the reason for passing this resolution in relation to
each matter, and the specific grounds under section 48(1) of the Local
Government Official Information and Meetings Act 1987 for the passing of this
resolution are as follows:
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General subject of each matter to be considered
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Reason for passing this resolution in relation to
each matter
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Ground(s) under section 48(1) for the passing of this
resolution
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Annual Insurance Renewal
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s7(2)(b)(ii) - The withholding of the information is
necessary to protect information where the making available of the
information would be likely unreasonably to prejudice the commercial position
of the person who supplied or who is the subject of the information.
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That the public conduct of the whole or the relevant
part of the proceedings of the meeting would be likely to result in the
disclosure of information for which good reason for withholding exists.
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Deloitte Fraud Risk Assessment
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s7(2)(f)(ii) - The withholding of the information is
necessary to maintain the effective conduct of public affairs through the
protection of such members, officers, employees and persons from improper
pressure or harassment.
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That the public conduct of the whole or the relevant
part of the proceedings of the meeting would be likely to result in the
disclosure of information for which good reason for withholding exists.
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Operational Risk Report
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s7(2)(g) - The withholding of the information is
necessary to maintain legal professional privilege.
s7(2)(i) - The withholding of the information is
necessary to enable the local authority to carry on, without prejudice or
disadvantage, negotiations (including commercial and industrial
negotiations).
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That the public conduct of the whole or the relevant
part of the proceedings of the meeting would be likely to result in the
disclosure of information for which good reason for withholding exists.
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That the Group Manager - Environmental Services, Group Manager - Services
and Assets (via Zoom), Group Manager - Community and Futures, Chief Financial
Officer, People and Capability Manager, Group Manager, Customer Delivery,
Communications Manager and Committee Advisor be
permitted to remain at this meeting, after the public has been excluded,
because of their knowledge of the items C8.1 Annual
Insurance Renewal, C8.2 Deloitte Fraud Risk Assessment and C8.3 Operational
Risk Report. This knowledge, which will be of
assistance in relation to the matters to be discussed, is relevant to those
matters because of their knowledge on the issues discussed and meeting
procedure.
That
Financial Accountant – Sheree Marrah and Rouen van Eck – Regional
Manager Marsh NZ and Lisa De Bruin – FinPro Client Liaison Advisor Marsh
NZ be permitted to remain at this meeting, after the public has been excluded,
because of their knowledge of the items C8.1 Annual
Insurance Renewal. This knowledge, which
will be of assistance in relation to the matters to be discussed, is relevant
to those matters because of their knowledge on the issues discussed.
That
Systems Accountant – Matthew Denton be permitted to remain at this
meeting, after the public has been excluded, because of their knowledge of the
item C8.2 Deloitte Fraud Risk Assessment. This knowledge, which will be of assistance in relation to the
matters to be discussed, is relevant to those matters because of their
knowledge on the issues discussed.
The
public were excluded at 12.56pm.
Resolutions
in relation to the confidential items are recorded in the confidential section
of these minutes and are not publicly available unless released here.
The meeting
concluded at 2.16pm. CONFIRMED
AS A TRUE AND CORRECT RECORD AT A MEETING OF THE Finance and Assurance Committee HELD ON MONDAY 22 JUNE 2020.
DATE:............................................................................................
CHAIRPERSON:........................................................................
