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Local Government Act 2002

Governance and management of local authorities and community boards - Local authorities - Other governance matters

44: Report by Auditor-General on loss incurred by local authority

You could also call this:

“The Auditor-General tells the local council about money problems and how to fix them”

You should know what counts as a loss for a local authority. A local authority is considered to have suffered a loss if any of these things happen and the local authority hasn’t been fully paid back: spending money it shouldn’t have, selling or getting rid of something it shouldn’t have, taking on a debt it shouldn’t have, or not trying to collect money it should get.

If the Auditor-General thinks a local authority has had a loss, they can write a report about it. This report goes to the local authority and can include ideas on how to get the money back or stop more losses from happening.

The Auditor-General must also send copies of this report to the Minister and everyone who is part of the local authority.

If you want to know more about what happens after this report, you can check out sections 45 and 46.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM171862.

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Part 4 Governance and management of local authorities and community boards
Local authorities: Other governance matters

44Report by Auditor-General on loss incurred by local authority

  1. For the purposes of this section and sections 45 and 46, a local authority is to be regarded as having incurred a loss to the extent that any of the following actions and omissions has occurred and the local authority has not been fully compensated for the action or omission concerned:

  2. money belonging to, or administrable by, a local authority has been unlawfully expended; or
    1. an asset has been unlawfully sold or otherwise disposed of by the local authority; or
      1. a liability has been unlawfully incurred by the local authority; or
        1. a local authority has intentionally or negligently failed to enforce the collection of money it is lawfully entitled to receive.

          1. If the Auditor-General is satisfied that a local authority has incurred a loss, the Auditor-General may make a report on the loss to the local authority, and may include in the report any recommendations in relation to the recovery of the loss or the prevention of further loss that the Auditor-General thinks fit.

          2. The Auditor-General must send copies of the report to the Minister and every member of the local authority.

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