Extraordinary Council meeting 27 August
Published on 27 August 2021
Kiama Municipal Council called an extraordinary meeting this Friday 27 August to endorse correspondence with key agencies, note an incorrect transfer of funds and to research Council's loan resolutions.
Following the report to Council on 17 August 2021 on the Financial Sustainability Plan and Long Term Financial Plan, Council continues to review its finances and deliver on its commitment for more transparency.
As part of Council’s comprehensive review of historical investment decisions and current loans, a breach was uncovered regarding the movement of $1 million in internally restricted reserve funds that was transferred to unrestricted without the required resolution of Council.
Council, like all local government authorities, holds a range of internal restricted funds and externally restricted funds, in line with legislative requirements. To date, just one administrative error has been found and dutifully disclosed in today’s extraordinary meeting.
Movements from restricted reserves, according to the Office of Local Government accounting code, must have resolutions to endorse transfer or movements. Management controls taken to ensure this does not occur again include the development of a restricted reserve policy, endorsed by Council at its June 2021 ordinary meeting.
The report also describes in detail additional steps that officers have taken to improve financial reporting and management practices. Management will now complete thorough reviews and further research into all restricted reserves, reporting back to Council on any required remedial actions.
The report also details a series of questions raised by the NSW Treasury Corporation (TCorp) which require a formal response from Council by Friday 27 August 2021 and this deadline prompted the need for an extraordinary meeting.
The meeting dealt with a recommendation endorsing the CEO’s required correspondence, with courtesy copies being sent to relevant departments including TCorp, the Audit Office of NSW and the Office of Local Government NSW.
The report also notes the need for resolutions for loan agreements and highlights that continued work into this subject will be undertaken, with a recommendation flagging future reporting.
Kiama Council CEO Jane Stroud said: “I’ve said before that I am committed to openness and transparency about financial matters of Council, and today’s report is a continuation of that commitment. The Chief Financial Officer and myself will complete the work required as part of implementing the 17 August and today’s resolutions.”
“As we continue to research and review, it is possible other issues may come to light. The important thing for all of us is to focus on the path towards financial sustainability and take decisive steps to correct errors when and where found.”
Kiama Mayor Mark Honey said: “We’re pleased this issue has been brought to our attention. We are more than happy to meet outside of our usual round of meetings to endorse the required correspondence and deal with this issue. We’re glad our CEO and CFO are focused on resolving the matter as quickly as possible.”