Director, Assurance and Risk Management Services
Date of Next Review
QUT is committed to establishing a cost-effective internal control structure with the objective of managing the operations of the University in a manner which provides the QUT Council reasonable assurance that:
- the University's plans (QUT Blueprint, faculty / division / institute plans, functional plans), and the priorities, strategies and targets contained therein, are achieved
- the University's resources (including its people, systems, data / information bases and customer goodwill) are acquired economically, applied efficiently and adequately protected
- quality business processes and continuous improvement are emphasised
- the actions of all University officers (including members of QUT Council, senior management and staff) are in compliance with the University's policies, standards, plans and procedures, and all relevant laws and regulations; and
- data and information published either internally or externally is accurate, reliable and timely.
'Control' is any action taken by QUT Council, management, and other parties or officers to manage risk and increase the likelihood that established objectives and goals will be achieved. This includes planning, organising and directing the performance of sufficient actions to provide reasonable assurance that objectives and goals will be achieved. Controls may be preventive (to deter undesirable events from occurring), detective (to detect and correct undesirable events that have occurred), or directive (to cause or encourage a desirable event to occur). The concept of a system of control is the integrated collection of control components and activities that are used by an organisation to achieve its objectives and goals.
The Vice-Chancellor is ultimately responsible for the establishment of a cost-effective internal control structure for the University in line with the requirements of the Financial and Performance Management Standard 2009 (Qld). However, the development and maintenance of cost-effective internal controls is a management responsibility and an integral component of the overall process of managing the operations of the University. As such, it is the responsibility of all managers at all levels of the University to:
- identify and evaluate the risk exposures which relate to their particular sphere of operations
- specify and establish policies, plans, operating procedures, systems and other disciplines to minimise, mitigate and/or limit the risks associated with the exposures identified
- establish practical cost-effective control processes that require and encourage all University officers to carry out their duties and responsibilities in a manner that achieves the above objectives; and
- maintain the effectiveness of the control processes that have been established and foster continuous improvement of these processes.
b) Audit and Risk Management Committee
The Audit and Risk Management Committee (A/3.3) is responsible for monitoring and overseeing the responsibilities of management, the internal audit function and external audit, as these responsibilities relate to the University's processes for controlling its operations and managing risks.
c) Assurance and Risk Management Services
Assurance and Risk Management Services, in accordance with the University's Assurance and Risk Management Services Charter (A/1.5), has responsibility for ascertaining that the control processes throughout the University are operating in an effective manner. Assurance and Risk Management Services is also responsible for reporting to University management and Audit and Risk Management Committee on the adequacy and effectiveness of the University's systems of internal control, together with recommendations to improve the control processes.
d) External audit
The external audit process provides assurances to Parliament on the stewardship (integrity, propriety, economy, efficiency and operations) of the University. The Auditor-General, as Parliament's external auditor, discharges these responsibilities principally through certification of the University's financial statements. The University's accounts are audited by the Auditor-General of Queensland in accordance with Section 30 of the Auditor-General Act 2009 (Qld). Section 46 of the Auditor-General Act 2009 (Qld) empowers the authorised auditor to have, at all reasonable times, full and free access to all documents and property belonging to the University. Members of the University community are responsible for assisting with the satisfactory conduct of the audit as necessary and for complying with the legislative requirements.
There are five primary components of internal control:
- Control environment
- Risk assessment
- Control activities
- Information and communication
a) Control environment
The level of awareness of University officers, and their actions and attitude towards the significance of control within the University, affects the way in which people conduct their activities, assess risk, carry out their control activities, and capture and communicate relevant information. Establishing an appropriate control environment involves setting standards for, and displaying human qualities such as integrity, ethical values and diligence, as stated in the QUT Staff Code of Conduct (B/8.1) and other related policies.
b) Risk assessment
Risk assessment represents the balance of the control environment with the risks and potential consequences associated with the University operations. An optimum level of control commensurate with risk is the objective resulting in cost-effective internal control. This maximises efficiency while providing an adequate level of security and control overthe University operations. QUT's risk management policy (A/2.5) and the detailed guidelines embodied in the Risk Management Framework provide guidance on the application of risk management processes.
c) Control activities
Control activities are the actions taken by QUT Council and management to protect assets and address risks. These include appropriate approvals, checks on accuracy and security of data, adequate segregation of incompatible duties such that no one person has complete control over all aspects of a transaction and IT security related control activities. Within QUT these control activities are embedded into University plans, policies, procedures, systems and business processes, and their effectiveness relies on the level of compliance by management and staff.
d) Information and communication
The effective and timely communication of management information to key officers of the University is essential for proper decision making. The dissemination of strategic goals, financial and non-financial data, policies and procedures, management initiatives and responses to external changes ensures effective performance. Therefore relevant internal and external information should be identified, captured, and communicated in a timely manner and in appropriate forms, both internally and externally where required.
Monitoring control processes on an ongoing basis maintains quality systems by providing data on performance. This will highlight any problem areas and allow early intervention and review to meet changing circumstances or needs. University systems need to be viewed as dynamic, responding to changes and open to improvement and refinement. Within QUT a range of mechanisms are used to monitor control processes, performance and risks, and examples include Management monitoring and reporting, monitoring by Audit and Risk Management Committee, Assurance and Risk Management Services, and external audits.
It is acknowledged that because of its inherent limitations, internal control can be designed and operated to provide only reasonable assurance that the University’s objectives and goals will be achieved. Examples of inherent limitations include human judgement and errors, manual and automated controls that can be circumvented by collusion, and inappropriate overriding of internal controls by management.
MOPP A/1.1 QUT Corporate Governance Framework
MOPP A/1.3 Compliance
MOPP A/1.5 QUT Assurance and Risk Management Services Charter
MOPPA/2.5 Risk management
MOPP A/3.3 Audit and Risk Management Committee
MOPP B/8.1 QUT Staff Code of Conduct
MOPP B/8.6 Corruption and fraud control
Business Continuity Management Framework
Corruption and Fraud Control Plan and Risk Assessment
Financial Management Practice and Procedures Manual (FMPPM)
Internal Control - Integrated Framework (known as "COSO" model)
QUT Risk Management Framework (QUT staff access only)
Auditor-General Act 2009 (Qld)
Financial Accountability Act 2009 (Qld)
Financial and Performance Management Standard 2009 (Qld)
|09.06.15||All||Director, Assurance and Risk Management Services||Periodic review - minor revisions only|
|09.07.12||All||Director, Assurance and Risk Management Services||Revised policy (minor editorial changes only, endorsed by Chair, ARMC)|
Director, Assurance and Risk Management Services
Revised policy (minor editorial changes only)
New policy (endorsed by Audit and Risk Management Committee 02.11.05); replaces former policies G/9.2, G/9.3 and G/9.4