Feb 2012 CEO update-Integration of OATSIH Compliance, Risk and Governance Practices

OATSIH is currently undertaking work to implement nationally consistent and rigorous frameworks and processes that seek to underpin departmental funding to organisations.

 OATSIH Risk Assessments: The decision to outsource the Risk Assessments was informed by an independent evaluation that was conducted about 18 months ago that included seeking the views of NACCHO, Affiliates and a selection of our member services.  The evaluation revealed overwhelming support from our sector for the concept of utilising an independent third party to undertake the risk assessments. Cogent Business Solutions has been selected to undertake the independent assessments.

 The Risk Assessment Tool has been modified and NACCHO has not been involved at any level in the changes to some of the questions that is now causing some concern and nor has NACCHO had any involvement in the appointment of the assessors.  Concern has also been raised with the inadequate notice being given to services of the impending visit by the assessors undertaking the risk assessment.

 The department is also now including additional financial analysis at a small number of organisations (15) each year as part of their risk assessment. Organisations will be randomly selected using stratified sampling, for an additional financial analysis to occur in conjunction with the scheduled risk assessment.  Assessment will be conducted in the following areas:

  • Asset Management
  • Travel Allowance
  • Cash Management
  • Management of grant related income
  • Overheads
  • Interest
    • Payments to subsidiaries or CEO and Directors of the organisation
  • Internal transfer of funds
    • Whether surplus funds is recorded as a liability or transferred to equity

Just to summarise the rollout of the RAPs:

  • 23 Regions across the country covering every State and Territory
  • 128 RAPs to be completed between Jan-April (this will be the period each year when RAPs are done)
  • The breakdown of the RAPs is as follows:
  • 5 NGOs that are service providers e.g. RFDS
  • 103 ACCHSs, SEWB and Mental Health Services
  • 10 ATSI Organisations e.g. Affiliates and Peaks
  • 10 NGOs e.g. Divisions of GP 

 NACCHO continues to lobby OATSIH to make the necessary changes to the current tool to ensure the process fosters “cooperative learning” for both our sector and OATSIH to enable a more proactive approach to mitigating risk in our services , and more importantly, for our services to have the capacity to self assess their efforts to improve quality.

 New nationally standardised compliance framework: The new framework will enable national consistency in the Departments approach to compliance activities with funded organisations. The development of the framework will be undertaken independently of OATSIH and they have commenced a tender process to appoint an appropriately qualified organisation.

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