Good news: the ANAO audit of the CLC

   

Wisely and slow, they stumble that run fast

Romeo and Juliet, Act two, scene three.

 

The ANAO yesterday released their audit of the Central Land Council (link here), the third in a series of four audits of the NT Land Councils established under the Aboriginal Land Rights (Northern Territory) Act 1976.

 

The headline findings include:

•           The CLC’s governance arrangements under the ALRA and NTA are largely effective. 

•           The CLC’s arrangements to promote the proper use and management of resources under the PGPA Act are largely appropriate, except for arrangements to manage risk of fraud and conflicts of interest.

 

The ANAO have provided a succinct, thorough and comprehensive outline and assessment of the internal workings of the CLC. The audit describes an organisation that appears to be well run and with systems that are fit for purpose in a demanding cross cultural governance environment. My own take on the audit findings is that the CLC’s governance systems provide a highly useful template that the other land councils would do well to consider and emulate.

 

There are only two issues that struck me as worth highlighting.

The first relates to the CLC’s internal auditors, PwC, which has also been providing auditing services to corporations that are in receipt of royalty and other payments by the CLC’s internal Aboriginal Associations Management Centre. The ANAO point out that a decision apparently made by the Audit and Risk Committee to move to different auditors for the CLC and the separate corporations had not been reflected in the formal documentary record. See para 4.40, and footnote 69. While perhaps an insignificant technical matter, it points to the risks that outsourcing key functions like ‘internal’ audit can create incentives for conflicts of interest to emerge.

 

The second issue relates to the comparative costs of the various audit and risk committees (ARCs) across the four land councils, and in particular, the costs allocated to the various chairs of the ARCs. The CLC has established a truly independent ARC, in contrast to the ALC which includes three TLC Council members on the Committee whose accounting skills are not made apparent as well as a consultant with extensive other business with the TLC (see paras 4.69-70 of the ANAO Tiwi Land Council Report (link here).

 

In the CLC report, the ANAO include a comparison of the fees paid to the chairs of the four Land Council ARCs (see para 4.71 and footnote 79). The ANAO note that total remuneration for the CLC Chair was $6700. In comparison, in 2021–22 the other NT Land Councils provided the following annual remuneration to the Audit Committee Chairs (excluding travel and other expenses): Anindilyakwa Land Council — $58,352 (three meetings); Northern Land Council — $3048 (four meetings); and Tiwi Land Council — $2780 (five meetings). This data speaks for itself.

 

The ANAO are to be congratulated on the thorough way they have gone about analysing what are complicated governance structures within unique statutory authorities.

 

The CLC is clearly well managed and appears to be providing valuable benefits to its diverse and geographically dispersed constituency.

 

We now await the final audit of the NLC.