CASA Annual Report 2003 04 Part 3: Corporate report
CASA outsourced the bulk of internal audit service provision to two external providers in 2002 to allow it to focus on improving internal audit management. The value of outsourcing continued to be evident in the attention CASA was able to give to internal audit in 2003–04.
Work during the year has ensured that audit planning now better reflects key risk exposures, with divisional risk management plans used to directly inform the priorities for the 2004–05 internal audit program.
CASA also gave attention to translating audit findings into management action and operational improvement. A formal program to monitor and follow-up on implementation of audit recommendations was established and will be backed by a database now under development. The effectiveness of this follow-up in ensuring timely management action will be a key performance indicator for the internal audit function in the future.
The 2003–04 audit program covered a range of CASA’s core business and corporate functions, processes and systems. These investigations benefited from the expertise and âdistance’ of auditors external to CASA.
CASA is in the top quartile of Comcover agencies and in Comcover’s 2004 benchmarking exercise, CASA’s benchmarking score improved from three to four out of a possible five.
During the year, CASA refined and improved its strategic risk assessments through use of a database that enables identification of common sources of risk and risk treatments. This risk profile was a key enabler of the assumptions underpinning the CASA Corporate Plan for 2004–05 to 2006–07. CASA also significantly improved the format and content of divisional risk management plans. Collectively these operational risks form the basis for CASA’s Operational Risk Profile.
A KPMG audit of CASA’s risk management planning framework undertaken during the year will inform strategies for future improvement.
An important project for risk-based regulation was development of a âproof of concept’ quantitative risk model. The model assesses, compares and predicts aviation safety risk using a number of parameters such as operators, sectors or locations. It can be used to inform CASA about whether or not a specific incident represents a net increase in overall safety risk.
The risk model uses aviation data derived from ATSB Aviation Safety Incident Reports, Airservices Australia Electronic Safety Incident Reports and CASA’s own Major Defect Report/Significant Defect Report database. Audit data from Requests for Corrective Action will be added to these inputs in the future. CASA built on work undertaken in 2002–03 to assess the reliability of these various data sources and to resolve some access issues.
CASA’s achievement in providing a risk picture of the Australian aviation industry was recognised with an Innovation Award in Comcover’s Awards for Excellence in Risk Management.
2003–04 saw a significant broadening of CASA’s risk-based approach to regulation from an individual to a systemic focus. Analysis of risk issues and trends from an industry-wide perspective will provide a better base for safety standards and another driver for safety education programs and surveillance.
In December 2003, CASA began a broad review of the safety of the aviation system to identify major risks by sector and test CASA’s activities against those risks. The first research paper, analysing fatal general aviation accidents, was published in April.9 Initiatives are under way for 2004–05 to address the three biggest causes identified – poor flight planning, mistakes in aircraft handling and fuel management.
During the year, CASA conducted an exercise to identify and collate all high-level CASA operational and corporate policies for examination as a whole and to determine the future arrangements for policy authorisation. As a result of this work, a framework has been developed for the future classification of policy, directives, instructions and procedures.
Consistent actions and decisions
Consistency in regulatory approach and decision making is a challenge for CASA, which is a national organisation with a large number of staff dispersed across offices located across the country. Current programs for reforming safety standards, improving surveillance techniques and introducing new enforcement tools add to this challenge.
While progress has been made over the past couple of years, actual and perceived inconsistency continues to be a strong source of grievance in the industry. The House of Representatives Standing Committee on Transport and Regional Services, in a recent report on regional transport services, recommended that CASA improve consistency in its regulatory decisions and services.10 The Minister also identified consistency as a key performance indicator for CASA in his November 2003 Charter Letter.
In 2003–04, there were two major exercises to improve consistency in surveillance and enforcement. CASA finalised new surveillance and enforcement procedures manuals, educated inspectors and managers about the objectives of the new approaches, and provided training in the practical application of the procedures. Systems are in place to monitor and follow-up on adherence to the procedures, and consistent application of the procedures is a corporate performance measure for both areas.
CASA’s Office of Legal Counsel continued to provide general training on legal issues, including legal interpretation, to CASA’s area and airline offices. In addition, CASA’s Learning and Development Section, in conjunction with technical experts, ran programs throughout the year on administration of specific regulations ranging from permissible unserviceabilities to dangerous goods acceptance. CASA staff also received training during the year in new regulations as part of implementing regulatory reform.
Last year CASA introduced a series of aviation ârulings’ setting out CASA’s policy on issues found to have caused confusion in the industry. The rulings are intended to set out CASA’s formal interpretation of particular regulations. They are published on CASA’s web site for the benefit of industry and are used by CASA staff to properly and consistently apply the regulations.
In 2003–04 CASA drafted a further five aviation rulings, to be issued in 2004–05, covering:
- training and checking requirements
- carriage of passengers in aerial work operations
- carriage of infants and children in excess of flight manual limitations
- serviceability of instruments and equipment for charter and regular public transport operations
- approval to manufacture components in the course of maintenance.
9. CASA, A Preliminary Analysis of Fatal General Aviation Accidents in Australia: 1991 to 2000, Canberra, April 2004. See http://casa.gov.au/hotopics/index.htm