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Risk Management

The Treasury's risk management practice is based on an approach modelled on the Joint Australian/New Zealand International Risk Management Standard (ISO 31000:2009). The Treasury's ability to manage in an uncertain and changeable operating environment and to achieve our outcomes is enhanced by the quality of our risk management.[8]

Our enterprise risk management approach ensures there is systematic and regular assessment and monitoring of key strategic and operational risks facing the Treasury. Our senior leaders regularly identify and assess the Treasury's core organisational risks and ensure that we take appropriate actions to manage them. Our overall set of risks is overseen by executive management and a Risk and Audit Committee (RAC)(a committee of the Treasury Board), which comprises three experienced external members to provide independent perspectives.

Consistent with good practice, we reviewed and modified our risk management approach during 2013/14. This is being tested and will be rolled out across the organisation during 2014/15.

Our internal audit function complements the risk management approach by providing assurance to the Board and senior management that key risks are being managed appropriately and that internal controls are operating effectively. The areas of focus are selected using a risk-based approach. During 2013/14, audits were conducted in the following areas: aspects of performance reporting; the adequacy of the application control environment for Treasury models (for example, the Treasury's forecasting model); and NZECO.

Notes

  • [8]NZ Risk Management Standard - AS/NZ ISO 31000:2009 defines risk as "the effect of uncertainty on objectives".
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