10.0 Evaluating Board performance
The performance of Boards and individual Board members cannot generally be measured solely against conventional corporate benchmarks based on financial performance. However, public sector Board performance can, at least to some extent, be measured by the long term success of an organisation in properly fulfilling the purpose for which it was established. Measures for the assessment of Board performance include the development of broad financial and non-financial performance measures for statutory authorities (and hence their Boards) as well as more direct measures to appraise collective Board performance and individual Board member performance.
Ministers are responsible for the performance and conduct of the Board and the members within their portfolio. There are also certain legislative requirements outlined below.
The Financial Administration and Audit Act 1977 (external link) (FAA Act) provides for the financial administration and audit of the State's public finances, of departments and statutory bodies, and for the audit of associated bodies. 'Statutory bodies' are defined in the FAA Act as:
Established by or under an Act, which have control of funds and whose members are appointed by or under an Act, or are appointed, or confirmed in appointment, by the Governor in Council or a Minister.
Part 3 of the FAA Act deals with financial administration of statutory bodies. Section 46C states that each statutory body shall:
- ensure that its operations are carried out efficiently, effectively and economically;
- cause funds and accounts to be established and faithfully and properly kept;
- ensure that liability for expenditure is incurred for lawful purposes only and expenditure is made in compliance with any prescribed requirements;
- as far as possible having regard to the limits of its powers and control - ensure reasonable value is obtained for moneys expended by it;
- ensure that its procedures, including internal control procedures, afford at all times adequate safeguards with respect to the correctness, regularity and propriety of payments made, the prevention of fraud or mistake, and the assessment, levy and collection of revenue and other amounts receivable;
- ensure that fees and charges for services or goods supplied to any person are properly assessed and levied and are adequate;
- ensure the prescribed requirements are met regarding preparation, certification and rendering of annual financial statements;
- prepare and update a Financial Management Practice Manual (if appropriate); and
- establish and maintain an adequate internal audit function if so determined by the appropriate Minister.
Last reviewed: 17 July, 2009
Last updated: 22 July, 2009
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