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Annual Report 2016 - 2017

Governance framework

The Legal Aid Commission of New South Wales is established under the Legal Aid Commission Act 1979 to improve access to justice for socially and economically disadvantaged members of our community. It is a statutory body representing the Crown.

The Legal Aid Commission of New South Wales is precluded from employing staff by section 47A of the Constitution Act 1902. The Legal Aid Commission Staff Agency, a separate Public Service agency with the Chief Executive Officer as its head, employs staff to enable the Legal Aid Commission of New South Wales to exercise its functions.

People employed in this way may be referred to as officers or employees or members of staff of the Legal Aid Commission of New South Wales.

Collectively, the Legal Aid Commission of NSW and the Legal Aid Commission Staff Agency are referred to as Legal Aid NSW.

Our governance structure ensures that the business objectives of Legal Aid NSW are met in an ethical and effective manner. See chart below.

Board and management roles and responsibilities

Legal Aid NSW has a Board that is responsible for establishing broad policies and strategic plans for Legal Aid NSW. The Chief Executive Officer is a member of the board. Board members appear in Board members.

The daily management of Legal Aid NSW is overseen by the Chief Executive Officer, with assistance from the Deputy CEO and ten Directors who appear in Senior directors.

The CEO has a performance agreement with the Attorney General. The Deputy CEO and Directors have performance agreements with the CEO.

Our work is supported by a range of plans and policies to establish procedural requirements, standards and priorities as well as compliance with the Legal Aid Commission Act 1979. These include the Legal Aid NSW Plan, Code of Conduct, legal aid guidelines and means tests, Corruption and Fraud Prevention Plan, and Business Continuity Plan.

Corporate planning involves staff

The new Legal Aid NSW Plan 2017–2018 was developed with input from a range of staff and the Executive as part of a structured process, which also involved input and commentary by the Board of Legal Aid NSW.

The single-year plan has retained the same structure and format as in previous years.

Actions in the Legal Aid NSW Plan are also included in divisional plans, providing an important link between operational and higher level planning and allowing staff to contribute more fully to the actions in the plan.

Progress against the plan is monitored by the Executive each quarter and reviewed by the Board. In 2017–2018, the frequency of review by the Board will increase as progress against the plan will be considered at all Board meetings.

The Legal Aid NSW Plan 2017–2018 is available in the About us section of the Legal Aid NSW website.

Code of Conduct

The Legal Aid NSW Code of Conduct addresses the requirements of the Public Service Commission and the Government Sector Employment Act 2013 Ethical Framework provisions.

The Code:

  • sets the legal, ethical and institutional context for ethical conduct by New South Wales government sector employees
  • provides advice to employees (executives, managers and staff) on demonstrating ethical good practice in leadership, decision-making and other responsibilities
  • clearly outlines the responsibility of all individuals to know, understand and comply with all the ethical and legal obligations that apply both inside and outside the workplace.

The Code of Conduct has been included in the Legal Aid NSW induction program and individual planning.

All our lawyers are bound by professional practice standards and comply with mandatory continuing professional development requirements.

Financial performance

Legal Aid NSW has a strong financial focus, robust budgets and clear, concise reporting to internal and external stakeholders. Detailed monthly financial reports are prepared for the Audit and Risk Committee and the Board. A commentary including detailed analysis is also provided. The Director, Finance and Facilities provides expert advice at Audit and Risk Committee and Board meetings.

Identifying and managing risk

Legal Aid NSW regularly conducts a risk assessment of its activities covering both strategic and operational risks. The risk assessment is used to prepare the Internal Audit Plan.

The Internal Audit Plan includes provision for additional audits should circumstances change during the course of the year. The preparation of the risk assessment is based upon a methodology recognising inherent risk and control effectiveness.

Each audit has a stated objective and scope of activity. All audit recommendations to improve controls require a management response detailing the action that will be taken to implement the recommendations, the designated responsible officer and an identified completion date for implementation.

Presentation of the Audit Plan and regular reports on the progress of audits and the implementation of audit recommendations are included on the agenda of the Audit and Risk Committee. The Audit Plan is based on a one-year risk assessment covering the period 2016–2017.

"We exceeded our target by completing six performance audits."

During 2016–2017, we completed six internal audits.

Number of performance audits completed

Target for 2017–2018: 5

Risk management process is kept flexible and responsive

Whilst risk management and internal controls are overseen by the Audit and Risk Committee, primary responsibility for managing risk and internal controls rests with line managers, who are required to ensure that an effective control environment operates within their area of responsibility.

Legal Aid NSW may undertake additional audits to meet contemporary issues and developments that are unforeseen by a risk assessment plan. This provides the Audit and Risk Committee with appropriate flexibility and responsiveness.

The Audits undertaken through the year were approved by the Audit and Risk Committee and are drawn from the Risk Assessment also approved by the Audit and Risk Committee.

Report from the Audit and Risk Committee 2016–2017

The primary objective of the Audit and Risk Committee is to advise the Board, including the Chief Executive Officer, on financial reporting practices, business ethics, policies and practices, accounting policies and internal controls.

Accordingly, the Committee oversees a range of activities, including the financial performance of Legal Aid NSW and the internal audit function.

During the first part of the year, the Committee comprised three members. Two members (Michael Coleman and Peter Whitehead) were independent members and one member (Kylie Beckhouse) was a non-independent executive member. Robyn Gray joined the Committee in early 2017 as the third independent member and Kylie Beckhouse finished her period as a non-independent member. The Chief Executive Officer, Deputy Chief Executive Officer and Chief Audit Executive, and the Director Finance also attend each meeting. Representatives from the Audit Office attended most meetings.

The Committee met on six occasions in 2016–2017 and reviewed a range of matters including:

  • Monthly financial results;
  • End of Year Financial Statements;
  • Updates on Internal Audits and the implementation of recommendations;
  • Board papers with financial implications;
  • District Court Backlog Expenditure;
  • Business Continuity Plans;
  • Client and Case Management System; and
  • Updated Risk Assessment, Audit and Risk Charter, and Internal Audit Plan.

The following internal audits were undertaken during the year:

  • Inaccurate or Fraudulent Claims
  • Business Continuity
  • Workplace Injury
  • Fraud and Corruption Control
  • Risk Assessment
  • Operational Information

Richard Funston
Chief Audit Executive

Internal Audit and Risk Management Attestation Statement for the 2016–2017 Financial Year for Legal Aid NSW

I, Brendan Thomas am of the opinion that Legal Aid NSW has internal audit and risk management processes in operation that are, excluding the exceptions or transitional arrangements described below, compliant with the eight (8) core requirements set out in the Internal Audit and Risk Management Policy for the NSW Public Sector, specifically:

Core Requirements For each requirement, please specify whether compliant, non-compliant, or in transition
Risk Management Framework
1.1 The agency head is ultimately responsible and accountable for risk management in the agency. Compliant
1.2 A risk management framework that is appropriate to the agency has been established and maintained and the framework is consistent with AS/NZS ISO 31000:2009 Compliant
Internal Audit Function
2.1 An internal audit function has been established and maintained Compliant
2.2 The operation of the internal audit function is consistent with the International Standards for the Professional Practice of Internal Auditing Compliant
2.3 The agency has an Internal Audit Charter that is consistent with the content of the ‘model charter’ Compliant
Audit and Risk Committee
3.1 An independent Audit and Risk Committee with appropriate expertise has been established Compliant
3.2 The Audit and Risk Committee is an advisory committee providing assistance to the agency head on the agency’s governance processes, risk management and control frameworks, and its external accountability obligations Compliant
3.3 The Audit and Risk Committee has a Charter that is consistent with the content of the ‘model charter’ Compliant

Membership

The chair and members of the Audit and Risk Committee are:

Mr Michael Coleman, Independent Chair Start term date: 29 June, 2016 Finish term date: 22 June, 2019

Mr Peter Whitehead, Independent Member Start term date: 28 October 2014 Finish term date: 11 March 2017 Re appointed from 11 March, 2017–11 March, 2020

Ms Robyn Gray, Independent Member Start term date: 11 March 2017 Finish term date: 11 March, 2020

Ms Kylie Beckhouse, Non-Independent Member Start term date: 12 March 2013 Finish term date: 11 March, 2017

Brendan Thomas, CEO
Date: 12 July 2017

Who are our committee members?

Peter Whitehead is a lawyer and the former Public Trustee of NSW. Peter was part of the original committee reviewing the role of audit within the New South Wales government. He has since chaired a number of New South Wales government Audit and Risk Committees, including Premier and Cabinet, Finance and Services, Attorney General's, Crime Commission and Judicial Commission. Peter currently works in the financial services industry.

Robyn Gray is a lawyer, accredited mediator and principal of Herne Gray and Associates P/L. She brings over 25 years’ experience as a prosecutor, investigator and legal manager in Commonwealth and New South Wales public sector agencies and several Royal Commissions. In 2007, Robyn established her own consultancy to service public sector and not for profit agencies. She is an independent member of the Office of the Director of Public Prosecutions Executive Board, the Justice Health Human Research Ethics Committee and three public sector Audit and Risk Committees.

Other members: Michael Coleman (See Board members), Richard Funston (See Senior directors), Kylie Beckhouse (See Senior directors).

Digital Information Security Annual Attestation Statement for the 2016–2017 Financial Year for Legal Aid NSW

I, Brendan Thomas, am of the opinion that Legal Aid NSW had an Information Security Management System in place during the 2016–2017 financial year that is consistent with the Core Requirements set out in the NSW Government Digital Information Security Policy.

The controls in place to mitigate identified risks to the digital information and digital information systems of Legal Aid NSW are adequate.

There is no agency under the control of Legal Aid NSW which is required to develop an independent ISMS in accordance with the NSW Government Digital Information Security Policy.

Legal Aid NSW has maintained certified compliance with ISO 27001:2013 Information technology - Security techniques - Information security management systems - Requirements by an Accredited Third Party during the 2016–2017 financial year.

Brendan Thomas, CEO

Business continuity

We have a Business Continuity Management Plan that is activated when a risk event renders Legal Aid NSW unable to continue to provide services from a regional office or a metropolitan office—including Central Sydney.

The Plan addresses a range of actions that are required to manage the situation, including a recovery management team to oversee the recovery process.

A Business Continuity Management Committee met regularly, chaired by the Director People and Organisational Development. During 2016–2017, we completed a review and update of our business continuity documents and plans and reviewed and validated our previously prepared Business Impact Analysis.

Business continuity training, staff awareness and testing is scheduled for early 2017–2018.

Fraud and corruption processes

Legal Aid NSW is committed to conducting business with honesty and transparency. Our Corruption and Fraud Prevention Plan outlines the approach adopted to prevent fraud and other corrupt behaviour.

The Plan addresses a number of controls, including responsibility structure, risk assessment, reporting systems, investigation standards and conduct and disciplinary standards.

The Plan complements other related documents such as the Code of Conduct and Protected Disclosure Policy.

The year ahead

  • Focus on improving performance, measuring the quality of our services, and understanding the costs of our services.
  • Establish a Project Management Office and embed project management more broadly in the organisation.
  • Review corporate governance and decision-making structures and implement an outcome-focused performance system.
  • Explore opportunities to improve our information security and business continuity arrangements.
  • Conduct five performance audits.
  • Assess and evaluate our Grants processes, efficiency and quality provided to clients by in-house and private lawyers.
  • Implement the Legal Aid NSW Plan 2017–2018 and develop a five-year strategic plan that will focus on longer-term priorities for our organisation.