Australian Wool Innovation gets positive audit result

The Australian National Audit Office has released its report into the finances and governance of AWI, finding that AWI was largely effective at meeting the requirements of its Statutory Funding Agreement and at applying the performance principles under that agreement, that its management and governance arrangements were largely appropriate and that its arrangements for managing funds were largely effective.

The report made six recomendations, aimed at improving board performance reviews, the development and maintenance of a balanced portfolio, measurement and reporting on improvements in administrative efficiency, arrangements to determine eligible research and development processes for preparing matching payment claims and risk management.

The audit cost $466,500 and the process involved examining AWI's documentation in detail, assessing a sample of AWI projects and purchase orders for compliance with their funding agreement and internal policies, meeting with AWI staff and meeting with Department of Agriculture, Fisheries and Forestry staff.

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AWI chairman Jock Laurie has welcomed the findings and the organisation has committed to implementing all the recommendations.

In his letter to the Auditor General Grant Hehir in May when he responded to the draft report Mr Laurie wrote that AWI was proud of the research, development and marketing work it undertakes on behalf of Australian woolgrowers in accordance with the Statutory Funding Agreement.

"We note that the audit coincided with the implementation of new frameworks and programs to improve our performance and measurement systems," he said.

"Our sole purpose is to invest in both R&D and marketing projects which will enhance the profitability, international competitiveness and sustainability of the Australian wool industry.

"We aim to increase value, demand and market access for Australian wool through collaboration and consultation with stakeholders, investment in research, development, extension and marketing initiatives whilst collaborating and consulting with stakeholders.

"AWI agrees with all the recommendations as presented in the Section 19 draft report as we are always seeking ways to continually improve all areas of governance within the company and are already taking steps to implement improvements in several key areas".

The audit was announced in November 2021, after it was requested by the Senate Rural and Regional Affairs and Transport Legislation Committee.

The committee had raised concerns that it had not received "satisfactory responses" to questions raised during Senate estimates hearings.

Following the report AWI will have to make changes including updating policies and processes, establishing performance indicators for administrative efficiency improvements and establishing an investment profile, which outlines a target proportion of projects against AWI, government and industry priorities and for each risk and return category.