NGER audit framework – 2013-14
Luke Scott, Manager, Scheme Audit and Assurance
GPO Box 621 Canberra ACT 26011300 553 542enquiries@cleanenergyregulator.gov.au www.cleanenergyregulator.gov.au
Maturing NGER audit framework
2010- Auditor registration
2011- Pilot NGER audits
2012- PEC, JCP, CFI audits
2013 – Liable entity report audits
2014 – Auditor review and inspection
Major achievement 2013

first liable entity report audits completed

commenced auditor review program

surpassed 200 registered greenhouse and energy auditors

over 850 audits under the NGER Audit Framework

update of Audit Determination Handbook

bedding down audits under the CFI, and

increased audit specific outreach activities
GPO Box 621 Canberra ACT 26011300 553 542enquiries@cleanenergyregulator.gov.au www.cleanenergyregulator.gov.au
520 audits received in 2013
Pre-submission liable entity audits

100% of required liable entities submitted audits

29% of other liable entities provided voluntary audits

98.6% of liable emissions audited

193/200 audit reports had a clean opinion

no adverse audit opinions, and

regulator initiated audits to provide assurance over unaudited emissions
GPO Box 621 Canberra ACT 26011300 553 542enquiries@cleanenergyregulator.gov.au www.cleanenergyregulator.gov.au
Some points from liable entity audits

inadequate justification of decisions made

lack of sufficient auditable evidence

incorrect methodology criterion applied

operational control, including treatment of contractors

non-reporting of minor emission sources

non-calibration of meters or equipment, and

minor calculation or input errors (transcription, incorrect conversion factors etc)
Auditor feedback (liable entity report audits)
The Clean Energy Regulator thought you covered the following well:

use of templates in Audit Handbook

application of ASAE 3410, and

definitive findings and conclusion
Auditor feedback (liable entity audits)
However, some aspects could be improved for future audits, in particular:

address of the audited body not included in Part A

Part B of the audit report not signed

key risks and rational for decisions not included in Part B

summary of procedures lacked the detail required and not tailored to each individual
engagement

peer reviewer lacked appropriate assurance experience

auditor engaged late (question if risks appropriately addressed), and

excessive wording undermined confidence in opinion given
GPO Box 621 Canberra ACT 26011300 553 542enquiries@cleanenergyregulator.gov.au www.cleanenergyregulator.gov.au
2012/13 NGER audit program

45 audits completed

no incidences of fraud or deliberate non-compliance

11% of total reported scope 1 emissions audited

0.5% quantifiable scope 1 errors

11 audit firms engaged, and

main issues identified related to record keeping and/or justification of decisions.
NGER reporting – 2012-13 reporting year
Data integrity around:

industry sector ANZSIC codes

matters to be identified (MTBI), and

source information.
Emissions and energy data:

a number of reporters did not report natural gas use and supply according to the
legislation

issues raised in audits

energy and emissions factors

inconsistency in electricity data, and

for landfill facilities it is important that only non-legacy emissions are included in the
facility’s liable emissions.
Changes – 2013-14 reporting year
Streamlining changes for the 2013-13 reporting year include:

reporting uncertainty

reporting immaterial amounts

availability of methods

last reporting year for VIPPs, and

reporting percentages and incidental emissions
GPO Box 621 Canberra ACT 26011300 553 542enquiries@cleanenergyregulator.gov.au www.cleanenergyregulator.gov.au
Audits under Carbon Farming Initiative

72 audits received during 2013
» 90 audits in total

3 qualified audits
» From 2 project proponents

15 audit team leaders from 17 audit firms involved

several joint venture audit combinations
GPO Box 621 Canberra ACT 26011300 553 542enquiries@cleanenergyregulator.gov.au www.cleanenergyregulator.gov.au
CFI audits by methodology
Auditor feedback (CFI Audits)
The Clean Energy Regulator thought you covered the following well:

use of multi-disciplinary teams

explanations of issues identified

identification of errors prior to finalising audits, and

responsive to Clean Energy Regulator feedback
Auditor feedback (CFI audits)
However, some aspects could be improved for future audits, in particular:

audit scope (refer to Audit Handbook)

clear, concise, transparent audit reports

excessive wording undermined confidence in opinion given

concerns that Project Proponents influencing audit scope/procedures, and

peer reviewer lacked appropriate assurance experience
GPO Box 621 Canberra ACT 26011300 553 542enquiries@cleanenergyregulator.gov.au www.cleanenergyregulator.gov.au
Audits for JCP and PEC

16 audits of partial exemption certificate applications under Renewable Energy Target
(173 applications)

applicants utilising JCP audits for PEC applications

unsure what requirements will be for 2014/15, and

templates and guidance now in audit handbook
2014 What’s ahead

second year of liable entity audit

2013/14 NGER audit program

potential tender for audit panel

implementation of auditor inspection program

minor update of audit determination handbook, and

implementing updated ASAE 3000
GPO Box 621 Canberra ACT 26011300 553 542enquiries@cleanenergyregulator.gov.au www.cleanenergyregulator.gov.au
Priorities for 2014

clear, concise, transparent audit reports

professional scepticism / depth of analysis, and

use of other auditors and experts (including peer reviewer)
GPO Box 621 Canberra ACT 26011300 553 542enquiries@cleanenergyregulator.gov.au www.cleanenergyregulator.gov.au