Results of 2016–17 Audits: Local Government

Extreme

The issue represents:

• a control weakness which could cause or is causing severe disruption of the process or severe adverse effect on the ability to achieve process objectives and comply with relevant legislation, or
• a material misstatement in the financial report has occurred.

Requires immediate management intervention with a detailed action plan to be implemented within one month.

Requires executive management to correct the material misstatement in the financial report as a matter of urgency to avoid a modified audit opinion.

High

The issue represents:

• a control weakness which could have or is having a major adverse effect on the ability to achieve process objectives and comply with relevant legislation, or
• a material misstatement in the financial report that is likely to occur.

Requires prompt management intervention with a detailed action plan implemented within two months.

Requires executive management to correct the material misstatement in the financial report to avoid a modified audit opinion.

Medium

The issue represents:

• a control weakness which could have or is having a moderate adverse effect on the ability to achieve process objectives and comply with relevant legislation, or
• a misstatement in the financial report that is not material and has occurred.

Requires management intervention with a detailed action plan implemented within three to six months.

Low

The issue represents:

• a minor control weakness with minimal but reportable impact on the ability to achieve process objectives and comply with relevant legislation, or
• a misstatement in the financial report that is likely to occur but is not expected to be material, or
• an opportunity to improve an existing process or internal control.

Requires management intervention with a detailed action plan implemented within six to 12 months.