Local council governance and audit committees - the missing link?

Jones, Gregory and Bowrey, Graham (2013) Local council governance and audit committees - the missing link? Journal of New Business Ideas and Trends, 11 (2). pp. 58-66. ISSN 1446-8719

Abstract

Purpose: This paper examines the level of compliance of NSW Local Government councils with the Internal Audit Guidelines developed and published by the NSW State Government to address the identified weaknesses in the governance structures of the councils. The specific focus is on a key component of good governance, in this instance whether an audit committee was established accordance with the guidelines.

Design/methodology: Archival data was used to research the 2009/2010 Annual Reports and websites of NSW Local Government councils to collect data on the existence and structure of their audit committees. The data is presented and analysed using basic quantitative analysis from which inferences are drawn.

Findings: There is only minimal compliance by NSW Local Councils to the Internal Audit Guidelines in relation to the establishment of an audit committee. The audit committees, which have been established, were reviewed and the structure and membership of a number of these committees were found to not meet the level of independence required as outlined in the guidelines.

Practical implications: This paper highlights the potential risk exposure in Local Government councils. The findings indicate that the current approach of merely recommending the establishment of an audit committee, is not as robust as legislation.

Originality/value: While there is a relatively large amount of literature on Local Government practices there is little on the level of compliance of Local Government councils with specific governance requirements such as the establishment of an audit committee.


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Item Type: Article (Commonwealth Reporting Category C)
Refereed: Yes
Item Status: Live Archive
Additional Information: Files associated with this item cannot be displayed due to copyright restrictions.
Faculty / Department / School: Current - Faculty of Business, Education, Law and Arts - School of Commerce
Date Deposited: 03 Aug 2016 01:00
Last Modified: 27 Mar 2017 05:05
Uncontrolled Keywords: audit committees; corporate governance; internal audit
Fields of Research : 15 Commerce, Management, Tourism and Services > 1501 Accounting, Auditing and Accountability > 150199 Accounting, Auditing and Accountability not elsewhere classified
15 Commerce, Management, Tourism and Services > 1503 Business and Management > 150303 Corporate Governance and Stakeholder Engagement
15 Commerce, Management, Tourism and Services > 1501 Accounting, Auditing and Accountability > 150101 Accounting Theory and Standards
Socio-Economic Objective: E Expanding Knowledge > 97 Expanding Knowledge > 970115 Expanding Knowledge in Commerce, Management, Tourism and Services
URI: http://eprints.usq.edu.au/id/eprint/28620

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