APM - TPH June 2015 -Final Draft

8/18/2019 APM - TPH June 2015 -Final Draft

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Attachment 2 to Item 11.3.1

___________________________________________________________________

TOWN OF PORT HEDLAND

AUDIT PLANNING

MEMORANDUM

30 JUNE 2015



___________________________________________________________________

Contents

1 KEY ENGAGEMENT INFORMATION 1

2 BACKGROUND AND GENERAL INFORMATION 1

3 REPORTING AND DELIVERABLES 2

4 TERMS OF ENGAGEMENT 4

5 STAKEOLDERS RELATIONSIP 5

! AREAS OF AUDIT EMPASIS AND AUDIT CONSIDERATIONS 5

" OVERALL AUDIT STRATEGY #

$ APPROAC SUMMARY 12

# IMPLICATIONS OF ACCOUNTING STANDARDS 13

1% TIMING 14

11 APPENDI& A' LO( RISK AREAS 1"

12 APPENDI& B' ADDITIONAL INFORMATION CONTACTS 1#

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1 Key engagement n!"#mat"n1$1 T"%n "! P"#t He&'an& '"g(t)(

Address Civic Centre, McGregor Street

Port Hedland WA !21

"ele#hone $%&' (1)& (3%%

1$2 Key T"%n "! P"#t He&'an& *e#("nne'

Pos)t)on N*+e

Chie* +ec-tive **icer Mal s/orne

0irector Cor#orate Services Sid ain

Manager inancial Services Peter ocian

1$3 Key R+M ,#& -ame#"n *e#("nne'

Pos)t)on N*+e

A-dit Partner 0avid Wall

Princi#al "ravis 4ate

2 ,a).g#"/n& an& gene#a' n!"#mat"n

2.1 ,a).g#"/n&

"he "o5n o* Port Hedland $the "o5n' is a Western A-stralian 6ocal Governmentlocated in the Pil/ara 7egion. "he "o5n is home to aro-nd 2%,%%% #eo#le *romdiverse c-lt-ral /ac8gro-nds and covers 11,&99 s:-are 8ilometers. Port Hedland isthe 5orld;s largest /-l8 e#ort *acilit< 5ith Pil/ara Ports A-thorit< recording a recordann-al tonnage thro-gh#-t o* 3!2.3 million tonnes in 2%13=19.

"he "o5n contri/-tes signi*icantl< to the Western A-stralian and national economies,5hile delivering high :-alit< *acilities and services to its comm-nit<. 7a#id gro5th has/ro-ght man< #ositive changes to the region and set the #ath to /ecoming a vi/rantand attractive regional cit<, <et this also carries the challenge o* /alancing economicand commercial develo#ment 5ith the needs o* the local comm-nit<.

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2.2 -"#*"#ate (t#/)t/#e

"he *ollo5ing diagram s-mmarises the "o5n;s cor#orate str-ct-re?

Council

Chief

Executive

Ocer

EngineeringPlanning &

CommunityCorporat

eDevelopment

Services Development ServicesServices

3 Re*"#tng an& &e'e#a'e(

3.1 +tat/t"#y a))"/nt(

"he stat-tor< acco-nts 5ill /e general #-r#ose *inancial statements *or the *inancial<ear ended 3% -ne 2%1), #re#ared in accordance 5ith the A-stralian Acco-ntingStandards $as the< a##l< to local governments and not@*or@#ro*it entities', other a-thoritative #rono-ncements o* the A-stralian Acco-nting Standards 4oard and the

*inancial re#orting #rovisions o* the Local Government Act 1995 and accom#an<ingreg-lations.

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3.2 L")a' G"e#nment A)t 15 t4e A)t

"he Act #rovides *or the *-nctions, o#eration and governance o* the "o5n andassociated matters.

"he A-ditor is re:-ired to *orm an o#inion as to 5hether the *inancial re#ort?

1. gives a tr-e and *air vie5 o* the "o5n o* Port Hedland;s *inancial #ositionas at 3% -ne 2%1) and o* its #er*ormance *or the *inancial <ear ended 3%-ne 2%1)

2. com#lies 5ith A-stralian Acco-nting Standards $incl-ding the A-stralian Acco-nting Inter#retations' and

3. is #re#ared in accordance 5ith the re:-irements o* the Local Government Act 1995 Part $as amended' and 7eg-lations -nder that Act.

Incl-de in o-r re#ort i* 5e /ecame a5are o* an< instance 5here the Co-ncil did notcom#l< 5ith the re:-irements o* the Local Government Act 1995 and Local Government (Financial Management) Regulations 1996 as the< relate to *inancialstatements.

3.3 G#ant(

Grants received /< the local government, de#ending on its nat-re, are re:-ired to /ea-dited and to #rovide a Grant Ac:-ittal re#ort demonstrating that the "o5n has metall o/ligations in res#ect o* discharging the grant in accordance 5ith the "erms andConditions o* its -nding=Grant Agreement.

"he A-ditor is re:-ired to *orm an o#inion that the recei#ts and #a<ments are tr-eand *air and that the "erms and Conditions o* the -nding=Grant Agreement have/een adhered to.

"he Grant Ac:-ittals have di**erent re#orting deadlines 5hich need to /e adhered toin order to receive *-nds on time and in the near *-t-re. We 5ill com#lete a-dits o* grants as and 5hen re:-ired to meet the "o5n;s re#orting o/ligations.

3.4 Management 'ette#(

Signi*icant *indings, emerging iss-es and their recommended resol-tion that arised-ring the a-dit 5ill /e #rogressivel< disc-ssed and comm-nicated to the relevantde#artments and the Manager o* inancial Services. An< 5ea8nesses in controls,5hich ma< /e identi*ied d-ring the c-rrent <ear a-dit, 5ill /e highlighted in the

management letter *ollo5ing the concl-sion o* the #reliminar< and *inal a-dits.Prior <ear management letter #oints, i* an<, 5ill /e *ollo5ed -# as #art o* the c-rrent<ear a-dit #roced-res.


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3.5 Ot4e# De'e#a'e(

Ent.*ne )nte.)e, ,)t AFC

"he entrance intervie5 5ill /e held 5ith the A-dit and inance Committee $AC' and5ill mainl< com#rise the #resentation and disc-ssion o* the A-dit PlanningMemorand-m $APM'.

C0os)n6 +eet)n6 ,)t CEO

Signi*icant acco-nting iss-es and *indings noted d-ring the *inal a-dit 5ill /e disc-ssed 5iththe Chie* +ec-tive **icer $C+'.

E7)t )nte.)e, ,)t A/)t Co++)ttee

"he eit intervie5 5ill com#rise disc-ssion o* an< signi*icant matters, stat-tor<acco-nts, management letters and an< im#rovements *or *-t-re a-dits 5ith the A-ditCommittee.

6 Te#m( "! Engagement

4.1 A##angement(

A-dits are not an a/sol-te g-arantee o* the acc-rac< or relia/ilit< o* "o5n;sin*ormation, and ma< not have identi*ied all matters o* signi*icance. "his is /eca-sethe 5or8 -nderta8en to *orm an o#inion is #ermeated /< B-dgement and most a-ditevidence is #ers-asive rather than concl-sive. In addition, there are inherentlimitations in an< a-dit, incl-ding the -se o* testing, the e**ectiveness o* internalcontrol str-ct-res and the #ossi/ilit< o* coll-sion.

Primar< res#onsi/ilit< *or the detection, investigation and #revention o* irreg-laritiesrests 5ith "o5n;s management. Conse:-entl< it is the "o5n;s management 5horemains res#onsi/le *or 8ee#ing #ro#er acco-nts and maintaining ade:-ate s<stemso* internal control, #re#aring and #resenting the *inancial statements, com#l<ing 5iththe Local Government Act 1995 and other relevant la5s.

4.2 Management Re*#e(entat"n Lette#

"he a-dit #lan ass-mes that "o5n re#resentatives 5ill /e in a #osition to sign amanagement re#resentation letter. We 5ill dra*t a management re#resentation letter and*or5ard to "o5n *or consideration and revie5. "he management re#resentation letter is

e#ected to /e signed at the same time as the ann-al *inancial re#ort is signed.

We 5ill rel< on the Chie* +ec-tive **icer signing the *inancial statements asevidence that the< con*irm?

1 "he< have *-l*illed their res#onsi/ilit< *or the #re#aration o* the *inancialstatements in accordance 5ith the a##lica/le *inancial re#orting *rame5or8,incl-ding their *air #resentation

2 "he< have #rovided -s 5ith access to all relevant in*ormation necessar< or re:-ested *or the #-r#ose o* the a-dit and

3 All transactions have /een recorded and are re*lected in the *inancial re#ort.


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5 +ta.e4"'&e#( #e'at"n(4*5.1 O/# #e'at"n(4* %t4 t4e T"%n

o- have re:-ested that 5e a-dit the *inancial re#ort o* the "o5n, 5hich com#risesthe statement o* *inancial #osition *or the *inancial <ears commencing 1 -l< 2%19thro-gh to 3% -ne 2%1( and the statement o* com#rehensive income, statement o* changes in e:-it<, statement o* cash *lo5s and rate setting statement *or the <earsthen ended, and notes com#rising a s-mmar< o* signi*icant acco-nting #olicies andother e#lanator< in*ormation, and the Statement /< Chie* +ec-tive **icer.

5.2 In&e*en&en)e

7SM International a-dit methodolog< re:-ires that 5e cond-ct an ann-al re@eval-ation o*

o-r inde#endence #rior to the commencement o* each assignment. We have *-ll<satis*ied o-rselves that 5e do not have an< act-al or #erceived con*lict o* interest.

7 A#ea( "! a/&t em*4a(( an& a/&t)"n(&e#at"n(

6.1 A#ea( "! a/&t em*4a((

As #art o* the ris8 assessment, 5e have determined 5hether an< o* the ris8sidenti*ied are, in o-r B-dgment, a signi*icant or high ris8. A signi*icant or high ris8 is anidenti*ied and assessed ris8 o* material misstatement that, in o-r B-dgment, re:-iress#ecial a-dit consideration.

"he assessment is /ased -#on?1 In:-iries o* 0irector Cor#orate Services and Manager inancial Services

2 "he com#leit< o* transactions 5ithin each area

3 "he degree o* s-/Bectivit< in the meas-rement o* *inancial in*ormation relatedto the ris8, es#eciall< those meas-rements involving a 5ide range o* -ncertaint<

4 7evie5ing #rior #eriod 5or8ing #a#ers and

5 Whether the area is e#osed to *ra-d ris8.

"he *ollo5ing ta/le lists those areas that are assessed as signi*icant or high ris8. "heareas assessed as lo5 ris8 are listed in A##endi 4.

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R)s8 A.e*

Dal-ation o* Eon@C-rrent Assets

A##ro#riate acco-ntingtreatment o* reven-erecognition or -nearnedincome

"imel< deliver< o* ca#ital#roBects and assetmaintenance

A/)t A99.o*

1 "he "o5n is re:-ired to im#lement air Dal-e Acco-nting *or Plant F +:-i#ment, 7oads, 6and and4-ildings and In*rastr-ct-re over the <ears ended 3% -ne2%13, 2%19 and 2%1). We 5ill need to #er*orm #roced-ress#eci*icall< to ens-re the carr<ing val-e o* these assets isnot materiall< overstated and that the< are acco-nted *or inaccordance 5ith the re:-irements o* AAS4 11 Pro#ert<,Plant and +:-i#ment, AAS4 1%1 Presentation o* inancialStatements and the 6ocal Government $inancialManagement' 7eg-lations 1((.

2 "he "o5n receives vario-s *-nding -nderCommon5ealth and State stim-l-s #ac8ages. S-chcontri/-tions 5ill have attached conditions related to timel<deliver< o* o-tcomes. "he terms and conditions o* the*-nding together 5ith the limited time *or deliver< co-lda**ect the recognition o* the *-nding as reven-e or lia/ilit< inthe <ear. A-dit 5ill need to eamine the conditions#ertaining to material *-nding advised=received in the <earas 5ell as the stat-s o* #roBect deliver< at <ear end againststated milestones to ens-re a##ro#riate recognition anddisclos-re has occ-rred.

3 7evie5 management re#orts on #rogress againstca#ital 5or8s /-dget

4 Com#are #rogress 5ith in*ormation and e#lanationsre#orted in the Standard statements

5 7evie5 e#lanations *or dela< and=or de*erralo* #roBects

6 7evie5 timing o* ca#italisation o* com#leted #roBects

7 +ns-re the 5ritten do5n val-e o* an< re#laced assetsare e#ensed #rior to <ear@end and

8 7evie5 the stat-s o* maBor #roBects, es#eciall< an<change in #roBect sco#e, *-nding and=or com#letion

details.



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R)s8 A.e*

Signi*icant B-dgementsand estimates

Eon@com#liance 5ith thetendering and :-otation#roced-res

Com#liance

7is8 o* *ra-d thro-ghmanagement override o*controls

$While the level o* ris8 o* management override o*controls 5ill var< *romentit< to entit<, the ris8 isnevertheless #resent in allentities'

A/)t A99.o*

1 "he #rices o* com#onents o* maBor non@c-rrent #h<sicalassets $s-ch as /it-men, as#halt, concrete etc.' ma< alterd-e to con*licting #rice #ress-res, /eing increased demandas a conse:-ence o* government stim-l-s activities, o**set/< disco-nts d-e to the glo/al economic crisis. 0ata held /<the "o5n /ased on #ast contracts ma< no longer re*lect

c-rrent mar8et conditions. Eeed to identi*< and eamineeternal #rice in*ormation #rior to <ear@end.

2 Assess e**ectiveness o* internal controls o#erating5ithin the #a<ment c<cle to ens-re that "o5n com#lies 5iththeir tendering and :-otation #roced-res *or decisionma8ing.

3 Consider the earl< 5or8 #er*ormed /< the "o5n onstrategies, agreed timeta/le 5ith client, earl<identi*ication and resol-tion o* iss-es,

4 7evie5 o* 6G Sol-tions ear +nd "em#late and /-dgetdoc-ments.

5 +ns-re com#liance 5ith 6ocal Government Act, A-stralian Acco-nting Standards, and other reg-lations.

6 7evie5 o* the monthl< *inancial statements and ann-al/-dget *or com#liance testing as 5ell as an anal<sis o* an<adverse trends or identi*ication o* *inancial ris8.

7 We 5ill assess the #rocesses in #lace to #reventand detect *ra-d.

8 ASA 29% "he a-ditors res#onsi/ilit< to consider *ra-din an a-dit o* a *inancial re#ort, im#oses s#eci*ic a-dit#roced-res, incl-ding?

9 "esting the a##ro#riateness o* Bo-rnal entries and other

adB-stments made in #re#aring the *inancial re#ort.

10 7evie5ing acco-nting estimates *or /iases.

11 7evie5ing signi*icant -n-s-al transactions.



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R)s8 A.e* A/)t A99.o*

7even-e C<cle • Assessment o* the e**ectiveness o* 8e< internal controlso#erating 5ithin the reven-e c<cle, incl-ding the

• 7ates reven-e a##lication controls.• Government grants • Per*orm a 5al8thro-gh on the 8e< management controls

• ser #a<s reven-e over the reven-e c<cle.

• Pro*it on sale o* non@ • Per*orm test o* control on 8e< management controlsc-rrent assets and over reven-e c<cle.

• ther income. • 7evie5 reconciliations and calc-lation o* rates reven-e

• "rade and other and com#are to historical res-lts.

receiva/les • 7evie5 *ees and charges on -ser #a<s reven-e andother income.

• Con*irmation *or grants received *rom local governmenta-thorities.

• 7evie5 monthl< reconciliations.

• 0etermine i* the disclos-res in the notes to the *inancial

statements related to client;s reven-e recognition #olic<are a##ro#riate.

• 7evie5 credit notes.

• Anal<tical revie5 techni:-es.

• 7evie5 o* receiva/les /alances and reconciliations

incl-ding con*irming a sam#le o* /alances 5ith

individ-al de/tors.

P-rchase and #a<ment • Assess e**ectiveness o* internal controls o#erating

5ithin the #a<ment c<cle.c<cle

• +#enses • Per*orm a 5al8thro-gh on the 8e< management controls

over the #-rchase and #a<ment c<cle.Ca#ital e#enses•

• Per*orm test o* control on 8e< management controls

over #-rchase and #a<ment c<cle.

1 Per*orm testing o* a sam#le on e#enses andca#ital e#enses.

6.2 Im*"#tant )4ange( n g"e#nan)e8 management "# nte#na')"nt#"' en#"nment(

"his is the *irst <ear 7SM has a-dited the "o5n. "his 5ill /e assessed as #art o* theinterim a-dit visit.

6.3 -/m/'ate .n"%'e&ge "! a))"/ntng an& )"m*/te# +y(tem(

"his is the *irst <ear 7SM has a-dited the "o5n. "his 5ill /e assessed as #art o* theinterim a-dit visit.


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6.4 Mate#a' #e'ate& *a#ty t#an(a)t"n(

"o5n is re:-ired to advise the a-ditors in 5riting o* details o* all related entities thatare in eistence at 3% -ne 2%1). "he advice sho-ld incl-de details o* the nat-re o* the arrangement, incl-ding the #eriod and val-e. A revie5 5ill /e cond-cted toens-re #ro#er acco-nting *or and disclos-re o* related #art< transactions andeec-tive rem-neration.

6.5 A**')a'e Leg('ate Re9/#ement(

In addition to the Local Government Act 1995 , the 8e< legislation im#actingo#erations and *inancial statements are?

1 State Records Act 2000 and

2or!ers" #om$ensation and %n&ur' Act 191

: Oe#a'' a/&t (t#ategy

7.1 P'annng mate#a'ty an& a&;/(te& mate#a'ty

"he #lanning materialit< level 5ill /e calc-lated and determined -sing o-r a-ditmethodolog<. "his amo-nt ma< /e adB-sted d-ring the co-rse o* the a-dit de#endingon the res-lts o* o-r a-dit #roced-res.

7.2 +/mma#y "! /(ne((8 !#a/& an& a))"/ntng #(. a((e((ment(

4-siness, *ra-d and acco-nting ris8s are assessed as lo5 /ased on the a-dit

*indings in #rior <ear, ece#t *or those s#eci*ic assertions classi*ied as high ris8 asdetailed in Section 1%.

7.3 F#a/& )"nt#"' (e'!<a((e((ment

We 5ill *or5ard "o5n a co#< o* the *ra-d control chec8list *or sel*@assessment #rior too-r *inal a-dit visit. "he *orm allo5s -s to ma8e in:-iries o* management, to o/taintheir -nderstanding on the ris8 o* *ra-d 5ithin their entit< and to determine 5hether management have 8no5ledge o* *ra-d that has /een #er#etrated on or 5ithin theentit<.

In addition to revie5ing the *ra-d control sel*@assessment /< "o5n management andthe A-dit and inance Committee, 5e 5ill #er*orm *ra-d testing as #art o* the a-dit#roced-res in areas o* man-al general Bo-rnal entries.

7.4 R(. mate#a'ty a((e((ment

Considering the /-siness, *ra-d and acco-nting ris8 assessments, the engagementteam 5ill assess 5hether each material acco-nt /alance or assertion 5ithin anacco-nt /alance #rovides signi*icant, high or lo5 ris8.

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7.5 A/&t a**#"a)4 !"# (gn=)ant an& 4g4 #(. mate#a'

a'an)e(

or all signi*icant and high ris8 material $H7M' acco-nt /alances, the engagementteam 5ill identi*< a-dit assertions that #ose high a-dit ris8 $i.e. eistence, rights ando/ligations, com#leteness, val-ation and c-t@o**'. It is li8el< that not all the assertions5ill /e deemed to /e high ris8. "hose assertions that are assessed as lo5 ris8 5ithina high ris8 acco-nt /alance 5ill /e tested in the same manner as lo5 ris8 material$67M' /alances and disclos-res.

7.5.1 Test o- Cont.o0s

Where 5e determine that an assessed ris8 o* material misstatement at the assertionlevel is a signi*icant ris8 and 5e intend on rel<ing on the o#erating e**ectiveness o* controls intended to mitigate that signi*icant ris8, 5e 5ill o/tain a-dit evidence a/o-tthe o#erating e**ectiveness o* those controls *rom tests o* controls #er*ormed in thec-rrent #eriod.

7.5.2 S:st*nt)e P.oe/.es

Where 5e have determined that an assessed ris8 o* material misstatement at theassertion level is a signi*icant ris8, 5e 5ill #er*orm s-/stantive #roced-res that ares#eci*icall< res#onsive to that ris8.

7.6 A/&t a**#"a)4 !"# '"% #(. mate#a' a'an)e(

67M /alances 5ill /e a-dited /< anal<tical #roced-res and tests o* details as

necessar<.7.7 T#an(a)t"n -y)'e Te(tng

-r a-dit a##roach involves the testing o* 8e< controls, #rimaril< d-ring the interima-dit visit, to determine the etent to 5hich 5e can rel< on those controls to #rod-cerelia/le *inancial and #er*ormance in*ormation.

4-siness c<cle control testing 5ill /e -nderta8en *or all /-siness c<cles in the *irst <ear o* o-r a-dit. In s-/se:-ent <ears, /-siness c<cle control testing 5ill /e -nderta8en on arotation /asis. +ach <ear, t5o /-siness c<cles 5ill /e selected *or in de#th testing.0e#ending on the res-lts o* o-r testing o* controls, 5e are #lanning to rel< on the controlsand red-ce s-/stantive testing on acco-nt /alances. "he remaining /-siness c<cles 5ill/e s-/Bected to 5al8thro-gh testing o* 8e< management controls.

or the c-rrent <ear, 5e 5ill /e cond-cting in de#th testing on the *ollo5ing /-sinessc<cles?

1 7even-e c<cle

2 Pa<roll c<cle.

3 Pa<ment c<cle and

4 ied asset c<cle.

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7.8 A/&t *#e*a#at"n )4e).'(t

"o assist "o5n in gathering and collating the necessar< in*ormation *or o-r #reliminar< and *inal a-dit visit?

1 P.e0)+)n*.; */)t )s)t @ We 5ill liaise 5ith the Manager inancial Services toarrange meetings 5ith relevant #ersonnel 5ith re*erence to the areas that 5e aregoing to cover, #rior to the commencement o* the #reliminar< a-dit visit.

2 F)n*0 */)t )s)t @ We 5ill *or5ard an A-dit Pre#aration Chec8list $APC' inadvance. As the re:-ested in*ormation 5ill *orm the /asis o* o-r a-dit 5or8ing#a#ers, the in*ormation m-st /e made availa/le to -s at the commencement o* o-r a-dit visit. "his assists -s in delivering an e**icient a-dit and minimisinginterr-#tions to "o5n sta**.


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> A**#"a)4 (/mma#y"he 7SM A-dit Methodolog< is an international a-dit methodolog<, -tilised /< all7SM International inde#endent net5or8 *irms 5orld5ide, that /lends technicalcom#etencies 5ith a detailed and ro/-st 8no5ledge o* the client, its mar8ets and theind-str< sector. sing these methodologies, the irm o**ers a tailored a-dit andass-rance a##roach, 5ith a strong em#hasis on earl< #lanning and ho5 the client;s/-siness *-nctions. "his ena/les -s to identi*< 8e< a-dit and ass-rance com#onentsand to tailor o-r #roced-res to the -ni:-e as#ects, siJe and nat-re o* a client;s/-siness and their service re:-irements. -r a##roach ens-res a-dit reso-rces aredirected at high ris8 /-siness c<cles and reso-rces are not 5asted on trivial /alancesor iss-es that 5ill not add val-e to <o- as a client. "he res-lt is an e**icient and coste**ective a-dit that adds val-e to <o-r o#erations

"he *ollo5ing model #resents a *lo5chart o* o-r a##roach?

P#e'mna#y ,/(ne(( #(. A/&t *'an

*'annng a((e((ment&ee'"*m

ent

Te(t "! &eta'+/n(tant0e -"nt#"'

ana'y)a' #e'an)e*#")e&/#e(

*#")e&/#e(*#")e&/#

e(

Re*"#tng



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Im*')at"n( "! a))"/ntng (tan&a#&(9.1 Im*')at"n( "! a))"/ntng (tan&a#&(

We have assessed the im#lications o* acco-nting standards and inter#retations that5ill im#act "o5n;s *inancial statements in the coming *inancial <ears. "he diagram/elo5 ill-strates the standards and inter#retations, 5hich have /een iss-ed /-t arenot <et e**ective, that ma< im#act "o5n in the #eriod o* initial a##lication. "hediagram sho5s that there are no acco-nting standards or inter#retations that 5illhave signi*icant im#act on "o5n d-ring the c-rrent re#orting #eriod.

"here are *-rther acco-nting standard and inter#retation changes, 5hich ma< haveim#lications *or "o5n moving into 2%1@1! and /e<ond, as #er the diagram.

To,n o- Po.t e/0*n/


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Page > 13



10Tmng

T)+et*

:0e

Pr e KPlanning

Planning

Pr eliminar <

A-diti

eld5or 8



T*s8 In/)*t)e Res9ons):0e



T)+e F.*+e P*.t;<)es=

0oc-ment method and develo#=re*ine March=A#ril 2%1) 7SMtest #rogram.

+ntrance meeting 5ith "o5n and 22 A#ril 2%1) 7SM#resentation o* APM to the A-dit and

"o5ninance Committee.

As #er a-dit #lanning stage /ased on 21 A#ril 2%1) to 7SMris8 assessment, *oc-sing on controls 29 A#ril 2%1)

"o5ntesting *or transaction c<clesconsidered to /e o* high ris8,5al8thro-gh on all maBor /-sinessc<cles and revie5 o* the 8e<reconciliation ro-tines.

Pr eliminar <

A-dit

Management6etter and=or #r eliminar

< a-dit * indi

ngs

0r a* t * inanc

ialstat

ement



7SM iss-e the dra*t Preliminar< A-dit 3% A#ril 2%1) 7SMManagement 6etter and Preliminar<

"o5n A-dit indings to "o5n management*or comment.

"o5n ret-rns the dra*t Preliminar< ! Ma< 2%1) "o5n A-dit Management 6etter andPreliminar< A-dit indings 5ithcomments to 7SM.

7SM to iss-e Preliminar< A-dit & Ma< 2%1) 7SMindings to "o5n.

7SM #resent the Preliminar< A-dit Ma< 2%1) 7SMindings at the A-dit Committee.

"o5n s-/mits dra*t *inancial statement 3% Se#tem/er "o5nas #er 6ocal Government Act 2%1)deadlines.

To

,n o- P

o.te/0*n/

AUDIT

P UM

3%ne2%15

Pa

ge >19

T)+et*

:0e

inal

A-dit

ield5or8

inal A-ditManagement

6etter $i* a##lica/le'







Iss-e dra*t Closing 7e#ort and 3% Se#tem/er 7SMManagement 7e#resentation 6etter to 2%1)

"o5n management *or comment.

"o5n ret-rns the dra*t Closing 7e#ort ! cto/er 2%1) "o5n

and Management 7e#resentation6etter 5ith comments to 7SM.

7SM to con*irm the *inal Closing & cto/er 2%1) 7SM7e#ort and Management7e#resentation 6etter.

TA

3

ne2%15

Page >1)



T)+et*:0e

+it Mee

ting

inal

7e#or t

A-d

it 7e#

ort

T*s8

Iss-eClosing7e#or t andinalManagement7e#re

sentation6etter to"o5nand AC.

+itmeeting5ith"o5nincl-ding#resentation tothe A-ditandinanceCommittee.

Signinal Acco-ntsandtheManagement7e#resentat

ion6etter.

7SM



to sig

n and iss-e th

e A-dit 7e#or t

to "o5n.



In/)*t)e Res9ons):0e

T)+e F.*+e P*.t;<)es=

( cto/er 2%1) 7SM

1& Se#tem/er 7SM2%1)

"o5n

( cto/er 2%1) "o5n

12 cto/er 2%1) 7SM

To,no-

Po.t

e/0*n/

AUDITPLANNINGMEMORANDUM

3% ne2%15

Page >1



11 A**en&? A@ L"% #(.a#ea(

Ke; A/)t*:0e

A.e*



Ke; Asso)*te/ R)s8s Ke; A/)t A99.o*

P.*se*n/

9*;+ent;0e

1 "rade andother#a<a/les

2 Accr-als

Inte.estBe*.)n6L)*:)0)t)es

T*7*t)on

• GS"

Cont)n6ent0)*:)0)t)es

In

cor r ect calc-la

tion o* accr -als

.

nder statement o* #a<a/les.

3

Classi

*ication/et5eenc-rrent

and non@c-rrent

4 6ia/ilities arenot#ro#erl</ro-ght toacco-nt.

5 "he

s#lit/et5eenc-rrentlia/ilitiesandnonc-rrent lia/ilitiesisinacc-rate.

6 ail-re to

com#l<5ith de/tcovenants.

7 GS"has not/een#ro#erl<calc-lated in

accordance 5ithGS"legislation.

8 Allcontingent lia/ilitiesare not#ro#erl<identi*iedand

disclosedin the*inancialstatements.

1

Per*

or ms-/stantivean

al<ticalrevie5.

7evi

e5 the calc-lat

ion o* mater ial

accr -al

s.

3

7evie5 s-/se:-ent #a<ments a*

ter <ear end.

4

Anal<se <ear

end int

er e

st/earinglia/ilit</ala

nces.

50et

er mine t

he cor r ects#lit

/et5een c-r r en

tand non



c-r rent#or tion.

6

Anal<ticalrevie5todeter m

inethat*inancecosts

have

/een #r o#er l< /r o-gh

t to acco-nt.

7ev

ie5de/tcovenantsandtest*or

com#liance5herenecessar<.

8 /taincon*irmation *romlender at<ear tocon*irmthe/alances.

9 7evie5<ear endGS"reconciledto4ASstatement.

10

7evie5 thecontingentlia/ilities

list.

11

An

al<sis o* <ear

end contingen

t li

a/ilities in com#ar i

son 5ith #r ior

#er

iod/alances.

12 7evie5min-teso*meetings

thro-gho-tthe<ear toidenti*<-ndisclosedcontingent

lia/ilities.

To,no-Po.te/0*n/

AUDITPLANNING

MEMORANDUM

3%ne

2%15

Pag

e > 1!



Ke; A/)t*:0e Ke; Asso)*te/ R)s8sA.e*

F)n*n)*0 • inancial statementsare not in accordancest*te+ent5ith 6ocal/)s0os.esGovernment Act 1(()and A-stralian Acco-ntingStandards.

Ke; A/)t A99.o*



• Cond-ct o* revie5 and test o* detailsover signi*icant *inancial statementdisclos-res, s-ch as?

• *inancial instr-ment disclos-res

• commitments and contingencies

• /asis o* #re#aration and signi*icantacco-nting #olicies

• *inancial ris8 management

P*;.o00;0e

1 Wagesandsalaries

2 +m#lo<eeentitlement#rovisions

C*s ;0e

1 Cashand cashe:-ivalents

2 7estr ictedcash andcashe:-ivalen

ts

1+ist

enceo* em#lo<ee

s.2 Inc

om#leteorinacc-r ateem#lo<eerecords.

3

ver#a<

mentor-na-thor ised#a<ments.

4

nderstatement o* #rovisions.

5 Inacc-ratecalc-lation o* #rovisions.

6 7

econciliations arenot#re#ared ona

timel</asi

s.

7

7econciliationsar enotr evie5ed/<a##r o#riateo** icer.

8Mis

management

o* cash.

• Assess

thee**ectiveness o*internal

controlso#erati

ng5ithin#a<rollc<cle.

•

Per*orma5al8thro-gh on the8e<

managementcontrols overthe#a<rollc<cle.

• Assess

theade:-ac<o* #a<roll

ece#tion

re#orting andcontrols.

•

Per*orms-/stantiveanal<ticalrevie5.

• "est

ade:-ac<o*#rovision*or

em#lo<ee



entitlements.

• Assess

thee**ectivenesso* internal

controlso#erating5ithincash

c<cle.

• Per*orm

5al8thro-gh over cashc<cle.

• Per*ormtest o*control on8e<

managementcontrols

over ca

sh c<cle

.

•

7evie5the

reconciliation*oran<long

o-tstandingor-n-s-alitems.

• /tain

/an8con*irmation as at<ear

end.

To

,

no-

P

o.te/0*n/

AUDI

T PLANNINGMEMORANDUM

3% ne 2%15

Page > 1&



12 A**en&? ,@ A&&t"na' n!"#mat"n )"nta)t(

David Wall

RSM Bird Cameron

5th

Floor, RSM Bird Cameron Building

8 St Georges Terrace

Perth Western ustralia !"""

Tel# $!% 8 &'!% &(8)

To,n o- Po.t e/0*n/


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Page > 1(

Documents

APM - TPH June 2015 -Final Draft