New regulations are being imposed to enhance council transparency and oversight in NSW.

A set of new regulations governing Audit, Risk, and Improvement Committees (ARICs) and internal audits have been introduced. 

These measures aim to empower elected councillors with better insights into their councils' performance and enhance their ability to oversee council operations effectively.

ARICs serve as advisory bodies, offering recommendations to the governing body on improving council performance. 

While councils have been required to establish ARICs since June 4, 2022, amendments to the regulations governing these committees and internal audit processes have been prompted by recommendations from the Independent Commission Against Corruption and the NSW Audit Office.

The updated regulations allow councils to customise how their ARICs operate, considering their size and operational risks. 

Importantly, these changes align ARIC oversight for councils, county councils, and joint organisations with the same standards applied to NSW Government agencies, strengthening accountability and transparency.

The key amendments necessitate ARICs to include voting members who are qualified and independent from the council, serving for time-limited terms. 

Councils must also adopt approved terms of reference for their ARICs and establish an internal audit charter.

ARICs are mandated to review various aspects of council operations, including legislative compliance, risk management, fraud control, financial management, governance, strategic plan implementation, service reviews, performance measurement data collection, and other specified matters.

These regulations will take effect on July 1, 2024, giving councils time for compliance. Additionally, councils can share ARICs, reducing costs and streamlining compliance efforts.

Starting from 2024/25, councils and joint organisations must report on their ARIC and internal audit compliance in their annual reports. 

These new regulations and guidelines will undergo a comprehensive review after four years of operation.

More information is accessible here.