November 2008
Performance Audit of Centrecorp Aboriginal Investment Corporation Pty Ltd
Office of Evaluation and Audit (Indigenous Programs)
November 2008
Performance Audit of Centrecorp Aboriginal Investment Corporation Pty Ltd
Office of Evaluation and Audit (Indigenous Programs)
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Cover!Image Tini!Din!t!Wlukutitj 2001 LindaSyddickNapaltjarri(c .1937-)
AcryliconCanvas CopyrightLindaSyddickNapaltjarri LicensedbyVISCOPY,Sydney
Community: Napaltjarri Orientation:vertical Society:Viscopy Category: Painting
©CommonwealthofAustralia2008
AbbreviAtioNs eXeCUtive sUMMArY executive summary Introduction AuditObjective AuditScope AuditMethodology Background KeyFindings Conclusion CentrecorpResponse Recommendations AUDit FiNDiNGs AND CoNCLUsioNs 1. Centrecorp’s structure and operations Background Centrecorpstructureandoperations AimsandobjectivesofCentrecorp 2. source and application of Australian Government funding Sourceoffunds Applicationoffunds 3. Financial performance and position Financialperformanceofrelevantbusinesses Financialpositionofrelevantbusinesses FinancialperformanceandpositionofCentrecorp 4. Corporate governance and transparency Trustarrangements Boardmembership Managementofconflictsofinterest ReportingtotheAustralianGovernment Reportingtoshareholders Publicprofile Directorsfees 5. benefits for Aboriginal people in Central Australia Increasedassetbase Employmentoutcomes Charitabledonations Foundation APPeNDiCes AppendixA–ListofDirectorships
Contents
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Abbreviations
ABA ABTA ADC ATSIC CAACT CAAMV CACT CAIC Centrecorp (thecorporation) Centrecorp CDC OEA IBA
AboriginalsBenefitAccount AboriginalsBenefitTrustAccount AboriginalDevelopmentCommission AboriginalandTorresStraitIslanderCommission CentralAustralianAboriginalCharitableTrust CentralAustralianAboriginalMotorVehicles CentralAboriginalCharitableTrust CentralAboriginalInvestmentCorporation Theindividualcorporateentity–CentrecorpAboriginalInvestment CorporationPtyLtd GeneralreferencetotheactivitiesofCAACTandCACT AboriginalandTorresStraitIslanderCommercial DevelopmentCorporation OfficeofEvaluationandAudit(IndigenousPrograms) IndigenousBusinessAustralia
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Executive Summary
executive summary Introduction 1. TheOfficeofEvaluationandAudit(IndigenousPrograms)(OEA)wasrequestedby theformerParliamentarySecretarytotheMinisterforFinanceandAdministration toauditCentrecorpAboriginalInvestmentCorporationPtyLtd(Centrecorp)and CAAMVPtyLtdundersection193X(1)(b)oftheTorrandtraiesSAobanlirigdnalsItre Act2005nda,enerepYseeyPtNyeinomnereNeydtLpeY(inaccoominees)tihdrnaecw paragraph14.2ofthednoCdnasmreTheGortnsfitioseihSraofartneYnerepeynytPdLt (stipulatedbyIndigenousBusinessAustralia)followingconcernsraisedoveralack oftransparency. 2.FollowingthechangeofGovernmentinNovember2007,thenewMinisterfor FinanceandDeregulationissuedarequeston20February2008forOEAtocontinue theaudit. 3. FieldworkwasconductedatCentrecorp’sofficesinAliceSpringsbetween26and 28ofSeptember2007andbetween21and24ofApril2008. Audit Objective 4.TheobjectiveoftheauditwastoexamineCentrecorp,YeperenyeNomineesand CAAMVPtyLtd’scorporategovernancearrangements ,thesourcingandapplication ofAustralianGovernmentfundsandbenefitsthataccrueforAboriginalpeoplein CentralAustralia. Audit Scope 5. Theauditexamined: •ngKiscore,rprrangemerativeaeeneCtntnsebwtsehTerutcurtethfostnimiad Canyon(Wattarka)ResortTrust,YeperenyeNominees,CAAMVPtyLtdandany otherassociatedindividualsandorganisations. •porategovernancTehcronotbuticnoisngn,ulidohetoratisanrggnarraefstneme limitedto: - decisionmaking - conflictsofinterest - internalcontrols - boardarrangements. •ontubtetdilimto:gn,ulidicnnusdoffionicatappldnasecruoS -AustralianGovernmentfunding(includingsharetransfersandloans)and incomereceivedfromAustraliaGovernmentfunding distributionofincome,profitsandbenefitstoAboriginalpeopleand -organisations.
Executive Summary
Audit Methodology 6. Theauditinvolved: • DiscussionswithstaffandDirectorsofCentrecorp ,KingsCanyonResortTrust, YeperenyeNomineesandPeterKittleMotorCompany. • ReviewofrelevantIndigenousBusinessAustralia(IBA)andAboriginaland TorresStraitIslanderCommission(ATSIC)filesanddocumentationinrespectof Centrecorpandrelatedentities. •ntmeeegrarefsnarterahsentandnagreemee,dlaogartndlerentvaewvifoeR documentation. •tothinearcresrelaGneitno.softheorganisadadinimartsnoitoherapeontians •rtlaAsubAroainthesoftralCenslaicnatnemetatauethffindtedileaRivgwienoi CharitableTrust(CAACT),CentralAboriginalCharitableTrust(CACT),Yeperenye NomineesPtyLtd ,YeperenyePtyLtd,KingsCanyonNomineesPtyLtd,Kings Canyon(Wattarka)ResortTrust ,CAAMVUnitTrustandAliceCarCentrePtyLtd. •veRweitfobehiontitaenumocdgninnalpssenisutd.tyLyePerenYpetfopscener •tutiontiethnsconoitfoaxEanimationredocumentreancneadngvotngtilao Centrecorp ,CAACT,CACT,YeperenyeNominees,YeperenyePtyLtd,KingsCanyon NomineesPtyLtd,KingsCanyon(Wattarka)ResortTrustandCAAMVUnitTrust. • ExaminationofBoardminutesinrespectofKingsCanyonNomineesPtyLtdand YeperenyeNomineesPtyLtd. 7.OEAwasnotprovidedwithaccesstotheCentrecorp,CAACT,CACTorAliceCar CentrePtyLtdBoardMinutesandsupportingpapersasManagementindicated thattheyarelikelytoincludecommerciallysensitivepapersthatdonotrelatetothe commercialentitysupportedbyGovernmentfunding. 8.Certaincommercial-in-confidenceinformationisnotcontainedinthisreport. Background 9. Centrecorpisaprivatecompany,registeredon10January1985 .Ithasfivesharesand wasestablishedbytheCentralLandCouncil(threeshares),TangentyereCouncilInc (oneshare)andCentralAustralianAboriginalCongress(oneshare) .Centrecorpwas createdfollowingnegotiationbytheCentralLandCouncil(CLC)ofacorridorofland toaccommodatetheNTGaspipeline.Aconditionoftheleaseoflandforthepipeline accesswasthatCentrecorphadtherighttonegotiateaninterestinthegaspipeline. However,Centrecorphadnocapitaltotakeuptheopportunityandagroupofpeople raisedthefundsanddonatedthemtothetrusttoacquirea1.5%interestinNTGas. TheCLCcreatedCentrecorptoholdtheshares,asunders.23(1)(ea)oftheAboriginal LandRights(NorthernTerritory)Act1976ytibilnitonnacslicnialalcianfinrcuLandCou, orreceivefinancialbenefitinassistingAboriginalpeoplewithcommercialactivities.
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