Certain Matters Arising from Allegations of Impropriety at Transend Worldwide Limited.

This report concerns Transend Worldwide Limited (Transend), a wholly-owned subsidiary of New Zealand Post Limited (New Zealand Post).

Transend is a company that is responsible for marketing to overseas postal agencies the expertise in postal reform and operating a modern postal system that has been built up within New Zealand Post. Until September 2001, Transend was also responsible for New Zealand Post’s international mail services, by far the major business of the company. The Board of New Zealand Post (the Board) governs Transend.

Following its 2000-01 financial review of New Zealand Post, the Finance and Expenditure Committee recommended that I provide assurance that Transend has made improvements to its policies and procedures, following allegations about its operations. The Committee’s concerns related mainly to the adequacy of the process that the Board had followed to investigate the allegations and whether any problems identified had been fixed.

This report is about:

  • the governance arrangements that the Board has for Transend;
  • the investigation process instituted by the Board in March 2001, following the receipt by a Board member of two anonymous letters alleging wrongdoing within Transend;
  • the Board’s response to the results of the investigation; and
  • the extent to which the problems identified have been addressed.

In carrying out our inquiry, we examined:

  • the adequacy of governance and accountability arrangements for Transend;
  • the investigation process that the Board undertook; and
  • Transend’s policies and procedures for letting tenders, compliance with financial delegations, and controls over travel, accommodation and business expenses.

The allegations about Transend’s operations have played out in the public domain over the past two years. In preparing this report, we felt that it was important to clearly outline the sequence of events and provide assurance that the necessary improvements have been made to Transend’s policies, procedures, and operations...