NGER Audit Framework 2014-15
Gavin Mongan, Scheme Audit and Assurance
2015 Auditor workshops
Key themes

integrity

control

consistency
These themes will be recurring throughout the day.
Pay attention.
You will be quizzed at the end.
Where are we now
(and where are we going)
Maturing NGER framework
2010 – Auditor Registration
2011 – Pilot NGER Audits
2012 – PEC, JCP, CFI Audits
2013 – Liable Entity Audits
GPO Box 621 Canberra ACT 2601
1300 553 542
[email protected]
www.cleanenergyregulator.gov.au
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2014 – Auditor Review & Inspection
2015 – ERF Audits
Major achievements 2014

Final Liable Entity audits completed.

Completed pilot auditor desktop inspection programme.

Received and assessed our 1500th audit under the Framework.

560 NGER

680 CPM (including JCP)

270 CFI

Established new Greenhouse and Energy Audit Service Panel.
Audit reports assessed
180
Carbon Farming
Initiative
160
140
Jobs and
Competitiveness
Program
120
100
80
Liable Entity Report
Audit Report
60
40
Partial Exemption
Certificate
20
0
2011
2012
2013
2014
2015
2013 vs 2014
Audits in 2013
593 audits across all schemes
Over half were carbon tax related including liable entity, JCP and audit programme.
GPO Box 621 Canberra ACT 2601
1300 553 542
[email protected]
www.cleanenergyregulator.gov.au
2
94% clean
Highest proportion of clean were
PEC and Voluntary audits.
Lowest proportion were CFI.
Audits in 2014
675 audits across all schemes
Increase due to higher number
of CFI audits (75 in 2013 vs 170
in 2014)
Offset by lower number of JCP
and PEC.
95% clean
Improvements in CFI as the scheme matures
Audits received in 2014
Carbon Farming
JCP
Clean
Liable Entity
Qualified
PEC
Unable to form an
opinion
s74 NGER
Voluntary NGER
0
40
80
120 160 200
NGER Audit Programme
2013/14 NGER Audit Programme

48 audits completed.

22 s19 audits

25 s22A audits
GPO Box 621 Canberra ACT 2601
1300 553 542
[email protected]
www.cleanenergyregulator.gov.au
3

1 s11 operational control audit

No incidences of fraud or deliberate non-compliance.

0.1% Quantifiable Scope 1 errors.

12 Audit firms engaged.

Main issues identified related to energy production and consumption, incorrect application of NGER
determination and record keeping issues.
Audits of liable entities
Liable Entity Audits
24,000,000
120.00%
20,000,000
100.00%
16,000,000
Mandatory audits Voluntary
No audit
80.00%
audits
12,000,000
60.00%
8,000,000
40.00%
4,000,000
20.00%
0
Liable entity
audits
0.00%
Carbon Farming Initiative
Audits under Carbon Farming Initiative

171 audits received in last 12 months.
»

10 Qualified audits from 6 Project Proponents.
»

270 audits in total
60% from landfill projects now corrected
19 audit firms using 16 audit team leaders.
»
a good mix of teams providing excellent value.
GPO Box 621 Canberra ACT 2601
1300 553 542
[email protected]
www.cleanenergyregulator.gov.au
4
Number of CFI projects vs abatement
Projects
Piggeries
Savanna
Burning
Landfill
methane
Reforestation
and
Afforestation
(including
native forest
protection)
Abatement
GPO Box 621 Canberra ACT 2601
1300 553 542
[email protected]
www.cleanenergyregulator.gov.au
5
Audit firms participation in CFI
200
180
160
140
120
100
80
60
40
20
0
Project proponents
Projects
The top 5 audit firms by number of projects audited assessed over 70% of projects from 50% of proponents.
Other audits
JCP and PEC
Audits for JCP and PEC

117 audits for JCP and PEC

99% of JCP audits clean

100% of PEC audits clean

75% from Cat 2 or 3 auditors

2014 final year of JCP audits

PEC to continue
*Registered Greenhouse and Energy Auditor (RGEA)
GPO Box 621 Canberra ACT 2601
1300 553 542
[email protected]
www.cleanenergyregulator.gov.au
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RGEA CAT
2
Company
Registered
Only
RGEA CAT
3
Registered greenhouse and energy auditors
Auditor registration

168 active registered greenhouse and energy auditors

review programme has resulted in reduction over 2014

greatest decrease in Cat 1 – down 11% over 2014

auditors can be registered in multiple categories
Cat 3
10%
Cat 2
39%
GPO Box 621 Canberra ACT 2601
1300 553 542
Cat 1
51%
[email protected]
www.cleanenergyregulator.gov.au
7
Auditor review
137 reviews initiated to date

majority of auditors meeting legislative requirements

minor recommendations for some

4 suspensions

7 deregistrations

24 self-initiated suspensions or deregistrations
Auditor review

Auditor management activities

Annual reporting

Notifications

Outreach and surveillance
Lessons learned
What has been done well

Use of multi-disciplinary teams including subcontracting.

Effective use of templates including fitting to existing branding.

Communication between firms and the Clean Energy Regulator.

Responsive to Clean Energy Regulator feedback.

Audit reports were broadly clear and concise.
Areas for improvement

Inconsistent audit scope and objectives.

Failure to reference appropriate legislation correctly.

Failure to reference correct standards (ASQC1, ASAEs).

Excessive wording undermined confidence in opinion given.

Peer reviewer lacked appropriate assurance experience.

Knowing limitations and capacity – Resourcing and capability.
GPO Box 621 Canberra ACT 2601
1300 553 542
[email protected]
www.cleanenergyregulator.gov.au
8
What’s next?
2015 What’s ahead…

2014/15 NGER Audit Programme.

No change to NGER Audit Framework.

No more Carbon Liability or JCP audits

Update of Audit Determination Handbook.

Maturing the Auditor Performance Framework, and

The Emissions Reduction Fund.
Key messages
Maintaining the integrity

Of the schemes

Of the audit framework

Of yourselves
Questions?
Gavin Mongan
You can also email [email protected] or phone 1300 553 542.
GPO Box 621 Canberra ACT 2601
1300 553 542
[email protected]
www.cleanenergyregulator.gov.au
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