PDF File - Guidance to Departments in Relation to Crown Entities

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Monitor results, value-for-money and performance against agreed targets Monitoring occurs against accountability documents (especially the SOI and output agreement), and against the laws, protocols and standards applying to Crown entities. Monitoring occurs against financial and service performance targets. Monitoring occurs against accountability documents (especially the SOI and output agreement), and against the laws, protocols and standards applying to Crown entities. Monitoring occurs against financial and service performance targets. 18 Departments should be able to inform the Minister whether: • major outputs were delivered against specifications in output plans • “real” costs of major outputs were reasonably consistent over time (i.e. after adjusting for inflation, and taking account of quality improvements) • effectiveness has been demonstrated appropriately, and is satisfactory • if like entities exist in a sector, entities compare in efficiency and effectiveness • trends in outcome indicators suggest progress is being made, and • at year end, that annual reports detail achievements, outputs, financial results and variances against agreed standards, and explain notable variances. 19 ECONOMY EFFICIENCY EFFECTIVENESS FUNDING INPUTS OUTPUTS OUTCOMES (expenditure) (staff time; materials) (goods & services) (benefits to citizens) VALUE-FOR-MONEY Departments should be able to assure Ministers that major outputs represent value-for-money Departments should be able to assure Ministers that major outputs represent value-for-money. Well managed entities should develop information on value-for-money, for consideration by their boards. Departments will constructively critique the entity’s approach and analysis, especially in relation to major interventions and services. Assure financial viability Departments should be able to assure the Minister whether: • financial indicators are on track, and any targets have been achieved, and 18 Departments will have previously advised the Minister on appropriate performance targets. 19 Appropriate actions and plans should be in place to address under-delivery, over-expenditure, etc. Guidance to Departments in Relation to Crown Entities | 22
• shortfalls or surpluses in budgets have been explained reasonably. (There should be no un-appropriated expenditure.) Ministers, including the Minister of Finance, should be given early warning of threats to the financial viability or effectiveness of any Crown entity Ministers, including the Minister of Finance, should be given early warning of threats to the financial viability or effectiveness of any Crown entity. Throughout the year, the fiscal situation of the entity is monitored to ensure: • budgets are sustainable (e.g. full costs are met by revenue, or the Minister has agreed to specific costs not in the budget). This includes reviews of Statements of Financial Performance, and managing emerging risks to sustainability • third party revenues (if any) are on track or have been achieved • costs are on track with planning documents, and being managed tightly • balance sheets are sustainable (e.g. reviewing Statements of Financial Position, and ensuring assets are maintained and can be replaced) • capital expenditure is on track and well directed, and • operating cash flows are sufficient to deliver outputs, and maintain capabilities. Monitor entity capability Departments should be able to assure Ministers that entities have the capabilities, now and in the future, to deliver their interventions and outputs In addition to monitoring the performance and financial viability of Crown entities, departments should be able to assure Ministers that entities have the capabilities, now and in the future, to deliver their interventions and outputs. Organisational capability can be described as comprising the following dimensions: • Leadership • People • Culture • Relationships • Processes and Technology • Physical Assets, and • Structure. Different entities require a different mix of capabilities, but both boards and monitoring departments need to assure Ministers that entities are planning and managing their capability to meet current and future needs. Departments should ensure they meet any specific capability monitoring responsibilities placed upon them, such as in relation to EEO good practice guidelines issued by the EEO Commissioner. Guidance to Departments in Relation to Crown Entities | 23
Page 1 and 2: Guidance to Departments in Relation
Page 3: Contents About this Guidance.......
Page 6 and 7: • assess entity capability (e.g.
Page 8 and 9: • the Minister setting the Crown
Page 10 and 11: Central Agencies The Minister of Fi
Page 12 and 13: C. Board appointments Advise the Mi
Page 14 and 15: D. Strategic direction and planning
Page 16 and 17: Departments will advise Ministers w
Page 18 and 19: • the behaviours, integrity and c
Page 20 and 21: • contract for the supply of info
Page 22 and 23: • preparing the estimates and oth
Page 26 and 27: A monitoring plan In addition to th
Page 28 and 29: • Inform Ministers about acquisit
Page 30 and 31: • be aware of any possible implic
Page 32 and 33: Appendix 3: Central agencies’ sta

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