Proposed Project Details

Project #2: Liquidity management

Risks Touched Upon By Project

• Cash & Funding Resilience
• Risk Culture
• Changes to the control environment

Internal Audit response

Liquidity Management: Proactively working with management to consider process and control risks and impacts to income streams and outlays given the current and prospective economic environment will help to implement considerations in a real-time manner.

Perspective:

• Short, medium and long term funding requirements can be impacted.
• Changes in budgetary spend have occurred - some have declined, some have increased, some have been added, some have been deferred.
• Economic environment impacts on income streams are also occurring and may increase.
• These events have a significant ability to impact current and future municipal budgets and services.

Project Focus:

It is important to support management through the re-prioritisation of spending and financial obligations, as well as consider what opportunities are there to accelerate cash collection/generation. Assess and provide real-time advice as to the City as it considers deferred/cancelled budgetary items, increase budget line impacts and potential short term and future income funding impacts (economic environment and tax arrears impacts.

Approach:

We recognize that such operations are in a state of flux and our input may be best served in current state analysis and conversations with management to identify potential considerations as to how to proactively identify risks and mitigate risks. There will be limited to no testing as part of this project but more focus on working with management to proactively identify the risks and potential controls from our perspective for management consideration. This should enable management to have a more comprehensive solution.

Reporting:

Our report will differ from the traditional format and be a memo reporting a summary of which areas we covered, if they were updated or to be updated and key areas of focus we recommended to management for consideration. By the time the formal memo is issued management will have likely acted on our input.