Financial Management and Accountability Amendment Regulations 1999 (No. 4)

Overview

The Financial Management and Accountability Amendment Regulations 1999 (No. 4) were enacted to amend the Financial Management and Accountability Regulations under the Financial Management and Accountability Act 1997. This Act, enacted by the Australian Parliament, was designed to provide a framework for the financial management and accountability of Commonwealth entities, aiming to ensure effective and efficient use of public resources. The regulations address a gap in the prescribed list of agencies by formally including the Australian Office of Financial Management (AOFM) as a prescribed agency, thereby extending the scope of entities required to adhere to the financial management standards set out in the Act. The policy objective of these amendments is to ensure comprehensive coverage and accountability of all relevant agencies within the framework established by the Act.

Scope and Application

The Financial Management and Accountability Amendment Regulations 1999 (No. 4) amends the Financial Management and Accountability Regulations 1997 by prescribing the Australian Office of Financial Management (AOFM) as a separate agency from the Department of State within the portfolio, for the purposes of the Financial Management and Accountability Act 1997. These regulations apply to the AOFM as an organisational unit that must adhere to the provisions of the Act in terms of financial management and accountability. The amendment is effective from 1 July 1999 and pertains to the Schedule of the regulations, which lists the prescribed agencies, including the AOFM, their composition, and their respective Chief Executives. The Act applies to Commonwealth entities, including departments, agencies, and other prescribed bodies, thereby ensuring a consistent approach to financial management and accountability across the Commonwealth. This legislative amendment ensures that the AOFM is subject to the same financial management and accountability standards as other agencies, enhancing the overall governance framework within the Commonwealth.

Key Provisions

The Financial Management and Accountability Amendment Regulations 1999 (No. 4) (the Regulations) are amendments to the Financial Management and Accountability Regulations 1997, which in turn are regulations made under the Financial Management and Accountability Act 1997 (the Act). These Regulations amend the Schedule to the 1997 Regulations, which lists the Agencies that are prescribed for the purposes of the definition of "Agency" in section 5 of the Act. Section 5 of the Act includes "a prescribed Agency" in its definition of "Agency", which means an organisational unit regarded as a separate Agency from the Department of State within the portfolio. Regulation 5 of the 1997 Regulations specifies these prescribed Agencies by referring to the Schedule, which names these Agencies, defines the persons they comprise, and specifies the Agency Chief Executive. The new Schedule 1, Part 1, Item 114AA inserted by the Regulations makes the Australian Office of Financial Management (AOFM) a prescribed Agency. The Act and its Regulations impose various obligations and requirements on the parties they govern. The primary obligation under the Act is to ensure that financial management and accountability are upheld within the prescribed Agencies. This includes adherence to the financial management standards and practices prescribed by the Act and Regulations, as well as maintaining proper records and reporting financial information accurately and timely. The Act also mandates that prescribed Agencies must have a financial management framework that includes policies, procedures, and systems designed to manage financial resources effectively and responsibly. These frameworks must be reviewed regularly to ensure compliance with legislative requirements and best practices. Under the Regulations, the prescribed Agencies are required to implement the changes specified in the amending Schedule. This involves recognising the AOFM as a separate prescribed Agency and ensuring that all financial management practices, reporting, and record-keeping within the AOFM comply with the Act and Regulations. The Agencies must also ensure that the Chief Executives of these prescribed Agencies are clearly identified and that their roles and responsibilities are well defined in line with the requirements of the Act. Breaching the provisions of the Act or the Regulations can lead to various civil and criminal consequences. Under section 18 of the Act, any person who contravenes a provision of the Act may be liable to a civil penalty not exceeding $11,000. Additionally, under section 20, a person who knowingly or recklessly contravenes a provision of the Act may be liable to a criminal penalty. The maximum penalty for a corporation is $55,000, while for an individual, it is $11,000. These penalties reflect the seriousness of non-compliance and aim to ensure that financial management and accountability standards are rigorously maintained within the prescribed Agencies.