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CASA Annual Report 2002 03 Part 5: Corporate management report

Part 5: Corporate management report

Risk and audit

CASA's objective is to develop a robust risk management framework, supported by a strong safety intelligence and research and analysis capability.

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Initiatives, developments and issues in 2002–03

Our strategies to meet this objective were developed as part of Critical Success Factor 5 in our Corporate Plan for 2002–03 to 2004–05.

Risk management framework

The progressive roll-out and implementation of the CASA risk management framework continued during 2002–03.

Importantly, both the strategic risk profile and divisional risk management plans were aligned with the Corporate Planning cycle and updated to reflect the new challenges and issues for the coming year. Risk profiles were also completed for all CASA's major project activities, including the Regulatory Reform Program implementation and the CASA Improvement Program.

In addition, we conducted risk management awareness sessions at key locations to improve the understanding of risk management of operational and support staff, particularly those in locations outside Canberra.

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Comcover insurance benchmarking

Comcover again benchmarked CASA's risk management framework in the top quartile of government agencies surveyed. We received the maximum discount of 5 per cent on our insurance premium with Comcover based on this result.

Maintaining a high benchmarking score and the advantages that go with that will remain a significant objective for continuous improvement of our risk management framework.

Research and analysis capability

We have added a new element to our risk management framework with the establishment of a limited analytical capability. Initial work has been directed at supporting the Corporate Plan and improved performance measures for the Executive Safety Committee. This capability is an important enabling element of the initiatives under the new business/segment model (see Figure 24).

In response to recommendations by the Australian National Audit Office1 we are assessing the robustness of CASA's current data sources and developing a limited quantitative risk model. The model is currently under trial as a desktop tool in the Sydney Airline Office.

1. Australian National Audit Office, Aviation Safety Compliance – Follow-up Audit, Canberra, 2002

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Internal audit

2002–03 has been a year of consolidation of the internal audit function.

We have adopted a co-sourced model with two external providers of internal audit services to CASA. CASA has retained a limited in-house capability to undertake sensitive audits, oversee delivery of the program and develop the three-year rolling audit program.

This model will continue until the end of the current contract in 2004–05. The quality of internal audit reports has improved and all internal audit reports now include recommendations that address key risk exposures to CASA.

Fraud control

In accordance with the Commonwealth Fraud Control Guidelines 2002, CASA has undertaken a fraud risk assessment and prepared a fraud control plan. We have appropriate fraud prevention, detection, investigation and reporting procedures in place and annual fraud control data has been collected and reported as required.

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Where to from here

Risk management

In 2003–04 we propose to review CASA's risk management planning framework in the light of our experience over the past two years and against best practice elsewhere. We will also be developing desktop tools to help CASA staff with risk management at the operational level.

Research and analysis

We will be working to establish CASA's corporate analytical and intelligence capability in the context of the CASA Improvement Program and pursuing the Australian National Audit Office's recommendations relating to our safety intelligence system.

Internal audit

The internal audit focus over the year ahead will be on providing a high level of support to the new CASA governance framework. We will revise current protocols and the Internal Audit and Risk Charter to reflect the new governance frameworks and accountabilities. We will also be looking to improve prioritisation of projects in the audit planning process and our 'follow-up' audit program.

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