Council to establish audit committee

The Central Otago District Council plans to set up an audit and finance committee in response to its rap over the knuckles from Audit New Zealand.

Councillors agreed in principle yesterday to establish the committee.

Chief executive Phil Melhopt said the council had no committee responsible for governance matters associated with audit, risk, legal compliance and financial management.

Twice in the past year, the council has been criticised by Audit New Zealand because its council planning documents contained insufficient detail on the framework for assessing the council's performance.

In its report, the organisation recommended the council set up an audit committee.

Mr Melhopt said the "raising of the bar" was evident in many aspects of the council's business, with other regulatory bodies also taking a closer focus on compliance, risk, and financial management.

"Having a committee to handle this would certainly help us to meet some of those compliance matters," he said.

The committee would comprise between three and five people with skills and experience in the legal, financial, commercial and governance fields.

They could be councillors or members of the public.

The committee's role might include carrying out an internal audit of the council's operation, he said.

It would also develop framework for financial planning and measuring compliance.