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Skills for Victoria I Contract Compliance Audit Guide for Registered Training Organisations
Contents
Introduction..4 Purpose of the Guide.....5 Why do we audit?..............................................................................................6 RTO Responsi i!ities. " #udit strate$y o%er%iew..& Which RTOs wi!! e audited?..........................................................................'( When wi!! RTOs e audited?...........................................................................'2 Where wi!! audits e underta)en?...................................................................'2 Who wi!! conduct the audit?............................................................................'* +ow wi!! RTOs e audited?.............................................................................'4 , -usiness Process #udits , Transactiona! .o/p!iance #udits , 0%idence of Participation #udits +ow can RTOs prepare for audit?.'& What can RTOs e1pect on the audit day2s3?..................................................'4 5e1t steps fo!!owin$ the audit.2( #udit Outco/es.2' , 6o!!ow,up #udits , Off,cyc!e #udits #udit feed ac) process.. 25 G!ossary..26 Tables '7 8)i!!s 9ictoria .ontract .o/p!iance #udit 8trate$y o%er%iew.............4 27 Ris), ased se!ection of RTOs for #udit....'' *7 -usiness Process #udit outco/es... 22 47 Transactiona! .o/p!iance #udit outco/es..2*
Skills for Victoria I Contract Compliance Audit Guide for Registered Training Organisations
Introduction
:nder de!e$ation fro/ the 9ictorian 8)i!!s .o//ission; 8)i!!s 9ictoria contracts Re$istered Trainin$ Or$anisations 2RTOs3 to de!i%er $o%ern/ent,su sidised trainin$ to indi%idua!s e!i$i !e for the Victorian Training Guarantee 29TG3 under the Skills for Victoria Pro$ra/. In accordance with its .ontract .o/p!iance #udit 8trate$y; 8)i!!s 9ictoria underta)es an annua! .ontract .o/p!iance #udit Pro$ra/ to ensure that contracted RTOs are co/p!yin$ with the ter/s and conditions of their Skills for Victoria 8er%ice #$ree/ent; inc!udin$ trainin$ de!i%ery specifications. 8)i!!s 9ictoria contracts an independent auditor pane! to7 conduct .ontract .o/p!iance #udits report findin$s de%e!op #$reed <ana$e/ent #ction P!ans with RTOs to address instances of non co/p!iance and to foster a cu!ture of continuous i/pro%e/ent a/on$ contracted RTOs.
The Skills for Victoria .ontract .o/p!iance #udit Pro$ra/ assists in /aintainin$ a hi$h =ua!ity 9ocationa! 0ducation and Trainin$ 290T3 sector in 9ictoria.
Skills for Victoria I Contract Compliance Audit Guide for Registered Training Organisations
Skills for Victoria I Contract Compliance Audit Guide for Registered Training Organisations
Wh do !e audit"
The o @ecti%es of the 8)i!!s 9ictoria .ontract .o/p!iance #udit 8trate$y are to7 Confirm funding has been e#pended appropriatel . #udits are underta)en to confir/ that funds pro%ided to RTOs under the Skills for Victoria Pro$ra/ ha%e een e1pended for the purpose that the funds were pro%ided and to see) rei/ urse/ent of those funds where this has not occurred in a c!ear and transparent /anner. Promote RTO regulator and standards compliance . #udits are underta)en to confir/ that RTOs are co/p!yin$ with the /ini/u/ re=uire/ents of the Skills for Victoria 8er%ice #$ree/ent and where this has not occurred; to reco//end pena!ties and sanctions as appropriate in a c!ear and transparent /anner. Promote RTO process $ualit . #udits are underta)en to identify opportunities for i/pro%e/ent in RTO usiness processes and contro!s to pro/ote co/p!iance with the Skills for Victoria 8er%ice #$ree/ent.
Skills for Victoria I Contract Compliance Audit Guide for Registered Training Organisations
RTO responsibilities
The Skills for Victoria .ontract .o/p!iance #udit Pro$ra/ is pre/ised on the understandin$ that an RTO; y enterin$ into a 8er%ice #$ree/ent; has ac)now!ed$ed the fo!!owin$ funda/enta! responsi i!ities7 The RTO is responsi !e for the /aintenance and preparation of re!e%ant audit e%idence in accordance with the Skills for Victoria 8er%ice #$ree/ent. The RTO is responsi !e for the i/p!e/entation of an interna! contro! en%iron/ent that pro/otes co/p!iance with the Skills for Victoria 8er%ice #$ree/ent and is desi$ned to detect and !i/it fraud or error. In accordance with the Skills for Victoria 8er%ice #$ree/ent; the RTO is to pro%ide 8)i!!s 9ictoria and its auditors with access to a!! infor/ation reasona !y re=uired for the purpose of confir/in$ co/p!iance with the Skills for Victoria 8er%ice #$ree/ent.
.ontract .o/p!iance #udits are not a su stitute for contract /ana$e/ent practices and do not re!ie%e an RTO of its responsi i!ities as defined under the Skills for Victoria 8er%ice #$ree/ent.
Skills for Victoria I Contract Compliance Audit Guide for Registered Training Organisations
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In wa!)in$ throu$h these processes; the auditor2s3 wi!! consider the way in which records are /aintained to pro%ide e%idence of the operation of usiness processes re!atin$ to the Skills for Victoria Pro$ra/. This inc!udes; for e1a/p!e; student enro!/ent for/s; trainin$ p!ans and 0%idence of Participation. 6or those RTOs not a!ready considered >hi$h ris)?; the -usiness Process #udit wi!! a!so assist the auditor2s3 in /a)in$ an assess/ent as to whether an RTO wi!! re=uire a Transactiona! .o/p!iance #udit. Transactional Compliance Audits Transactiona! .o/p!iance #udits are desi$ned to identify co/p!iance or non, co/p!iance with the Skills for Victoria 8er%ice #$ree/ent and in%o!%e the detai!ed e1a/ination of a sa/p!e of student records to test whether contro!s are effecti%e!y i/p!e/ented y an RTO. The audit wi!! assess an RTO?s co/p!iance with #$ree/ent with respect to areas inc!udin$7 student enro!/ent trainin$ p!an de%e!op/ent trainin$ de!i%ery and reportin$.
The Transactiona! .o/p!iance #udit wi!! a!so assist auditors in /a)in$ an assess/ent as to whether an RTO wi!! re=uire an 0%idence of Participation #udit.
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(%idence of Participation Audits RTOs /ust e a !e to support the sa/p!ed units of co/petencyE /odu!es with 0%idence of Participation as prescri ed in the Skills for Victoria 8er%ice #$ree/ent; in respect of each e!i$i !e indi%idua! for which it has recei%ed funds for $o%ern/ent su sidised trainin$ fro/ 8)i!!s 9ictoria. 8hou!d any audit of an RTO identify issues re!atin$ to insufficient e%idence to support trainin$ de!i%ery to e!i$i !e indi%idua!s under the Skills for Victoria Pro$ra/ for which pay/ent has een /ade; 8)i!!s 9ictoria /ay insti$ate an 0%idence of Participation #udit in%o!%in$ a statistica!!y %a!id sa/p!e siFe. If the 0%idence of Participation #udit re%ea!s that units of co/petencyE /odu!es audited are not sufficient!y supported then 8)i!!s 9ictoria /ay see) a refund of so/e or a!! the funds fro/ an RTO in accordance with the Skills for Victoria 8er%ice #$ree/ent.
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The audit report wi!! initia!!y e pro%ided to the .0O or .0O e=ui%a!ent of the RTO as a draft for ac)now!ed$e/ent and co//ent. The RTO wi!! ha%e a period of ti/e to pro%ide /ana$e/ent co//ents to the auditor2s3; inc!udin$ co//ents in re!ation to the audit findin$s and #$reed <ana$e/ent #ction P!an. The auditor2s3 wi!! re%iew any co//ents pro%ided and a/end the report; if considered necessary or appropriate. If the RTO does not pro%ide a response within the desi$nated period of ti/e; the RTO wi!! ha%e wai%ed its ri$ht to co//ent on the audit. 6o!!owin$ consideration of the audit findin$s; for/a! correspondence inc!udin$ a fina! copy of the audit report wi!! e pro%ided to the RTO in a ti/e!y /anner. This correspondence wi!! out!ine any further steps to e underta)en as necessary.
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Audit outcomes
If an audit identifies that an RTO is not co/p!yin$ with the Skills for Victoria 8er%ice #$ree/ent andEor has not esta !ished contro!s around )ey processes inc!udin$7 e!i$i i!ity assess/ents student enro!/ent trainin$ p!an de%e!op/ent trainin$ de!i%ery and reportin$
appropriate action wi!! e ta)en y 8)i!!s 9ictoria on eha!f of the 9ictorian 8)i!!s .o//ission. In addition to see)in$ i/pro%e/ent throu$h the i/p!e/entation of #$reed <ana$e/ent #ction P!ans; 8)i!!s 9ictoria /ay a!so app!y pena!ties and sanctions such as7 the RTO to /eet with 8)i!!s 9ictoria to discuss the .ontract .o/p!iance #udit findin$s and re=uired ne1t steps andEor perfor/ance of a statistica!!y %a!id 0%idence of Participation #udit in instances where 0%idence of Participation is insufficient; which /ay resu!t in reco%ery of fundin$ fro/ the RTO andEor referra! of infor/ation re$ardin$ the .ontract .o/p!iance #udit findin$s to the re!e%ant re$u!ator for consideration andEor not a!!owin$ new enro!/ents unti! non,co/p!iance /atters identified at audit ha%e een addressed to the satisfaction of 8)i!!s 9ictoria andEor c!assification of an RTO as ine!i$i !e for a Skills for Victoria contract in the fo!!owin$ year andEor i//ediate ter/ination of an RTO?s Skills for Victoria 8er%ice #$ree/ent.
In the e%ent that a .ontract .o/p!iance #udit findin$ identified in one year is a$ain identified in the fo!!owin$ year; the reoccurrence wi!! e %iewed y 8)i!!s 9ictoria as a serious /atter. #ccordin$!y; reoccurrin$ .ontract .o/p!iance #udit outco/es wi!! attract increasin$!y se%ere pena!ties.
Skills for Victoria I Contract Compliance Audit Guide for Registered Training Organisations
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)ollo! /p Audits 8)i!!s 9ictoria; at its discretion; wi!! se!ect a nu/ er of RTOs in the Skills for Victoria .ontract .o/p!iance #udit Pro$ra/ to under$o a 6o!!ow up #udit. 6o!!ow up #udits are desi$ned to reinforce the i/portance of RTO?s ta)in$ correcti%e action to address any issues identified in either -usiness Process #udits or Transactiona! .o/p!iance #udits. Gurin$ the fo!!ow up audit the auditor2s3 wi!! see) e%idence that actions ha%e een ta)en as out!ined in the RTO?s #$reed <ana$e/ent #ction P!an; i.e. confir/ation of the i/p!e/entation status of the p!an. The e1act nature of a specific fo!!ow up audit wi!! e inf!uenced y the type of correcti%e action ein$ i/p!e/ented. #s such; it /ay ta)e the for/ of a des) top audit; face to face inter%iew; onsite %isit or co/prehensi%e further Transactiona! .o/p!iance #udit. Off*c cle Audits Off,cyc!e audits /ay e tri$$ered y /atters which co/e to the attention of 8)i!!s 9ictoria throu$hout the year inc!udin$ the identification of issues throu$h on, $oin$ ana!ysis of 89T8 dataA co/p!aints to 8)i!!s 9ictoria which cannot e /ana$ed as part of the contract /ana$e/ent processA or cessation of a Skills for Victoria 8er%ice #$ree/ent. Off,cyc!e audits /ay or /ay not fo!!ow the audit process out!ined as part of the p!anned Skills for Victoria .ontract .o/p!iance #udit Pro$ra/. These audits /ay e particu!ar!y tar$eted to an identified issue.
Skills for Victoria I Contract Compliance Audit Guide for Registered Training Organisations
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Glossar
Audit e%idence Infor/ation used y auditors to for/ the asis of the assess/ent of audit outco/es in our reports. #udit e%idence can inc!ude infor/ation contained in student records such as enro!/ent for/s; trainin$ p!ans; and 0%idence of Participation. &usiness process # co!!ection of acti%ities perfor/ed y an or$anisation to produce a specific ser%ice or product; or to achie%e a specific outco/e. Control acti%ities0 The po!icies and procedures that he!p ensure that /ana$e/ent directi%es are carried outA for e1a/p!e; that necessary actions are ta)en to address ris)s that threaten the achie%e/ent of the or$anisationHs o @ecti%es. .ontro! acti%ities; whether in IT or /anua! syste/s; ha%e %arious o @ecti%es and are app!ied at %arious or$anisationa! and functiona! !e%e!s. .ontro! acti%ities are a co/ponent of interna! contro!. Control en%ironment0 Inc!udes the $o%ernance and /ana$e/ent functions and the attitudes; awareness and actions of those char$ed with $o%ernance and /ana$e/ent concernin$ the or$anisationHs interna! contro! and its i/portance in the entity. The contro! en%iron/ent sets the tone of an or$anisation; inf!uencin$ the contro! consciousness of its peop!e. It is the foundation for effecti%e interna! contro!; pro%idin$ discip!ine and structure. The contro! en%iron/ent is a co/ponent of interna! contro!. Ser%ice Agreement The Skills for Victoria 8er%ice #$ree/ent etween your RTO and the 9ictorian 8)i!!s .o//ission. Risk00 The possi i!ity that an e%ent wi!! occur and ad%erse!y affect the achie%e/ent of o @ecti%es. Segregation of incompatible duties #ssi$n/ent of different peop!e the responsi i!ity of authorisin$ transactions; recordin$ transactions and /aintainin$ custody of assets with the intention of reducin$ the opportunities to a!!ow any person to e in a position to oth perpetrate and concea! fraud or error due to fraud in the nor/a! course of his or her duties. SVTS The 8)i!!s 9ictoria Trainin$ 8yste/ is a we , ased infor/ation techno!o$y product used for /ana$in$ transactions etween 8)i!!s 9ictoria and contracted RTOs inc!udin$ $enera! co//unications; data reportin$; c!ai/s and pay/ents.
I II 8ource7 #:#8- G!ossary; issued y the #uditin$ and #ssurance 8tandards -oard 8ource7 0nterprise Ris) <ana$e/ent J Inte$rated 6ra/ewor) 22((43; issued y the .o//ittee of 8ponsorin$ Or$anisations 2.O8O3 25
Skills for Victoria I Contract Compliance Audit Guide for Registered Training Organisations