Controlling sensitive expenditure: Guidelines for public entities.

Conflicts of interest exist when staff duties or responsibilities to an entity could be, or could perceived to be, affected by some other separate interest or duty. Conflicts of interest can have both legal and ethical dimensions.1

Controls are the means to promote, direct, restrain, govern, and check on various activities.

Credit card has the normal meaning, but should also be read as applying to vehicle fleet cards, purchase cards, and equivalent cards used to obtain goods and services before payment is made.

Leaders and senior managers means the members, office holders, and senior employees of a public entity.

Proper and prudent behaviour, in relation to expenditure, includes identifying and managing conflicts of interest (or situations with the potential to be perceived as conflicts of interest); being fair, honest, transparent, circumspect, and careful to avoid undesired consequences; and being accountable for complying with organisational controls over expenditure.

Public entity and entity have the same meaning as in section 5 of the Public Audit Act 2001. As provided in that Act, the term includes any subsidiary or other controlled entity of the principal entity.

Public sector means all public entities.

Sensitive expenditure is expenditure by a public entity that provides, has the potential to provide, or has the perceived potential to provide a private benefit to an individual staff member of a public entity that is additional to the business benefit to the entity of the expenditure. It also includes expenditure by a public entity that could be considered unusual for the entity’s purpose and/or functions.2

Staff means all members, trustees, office holders, managers, and employees of a public entity.

We, us, and our mean the Office of the Auditor-General, and includes the Auditor-General’s appointed auditors.

1: Members of local authorities should refer to our publication Conflicts of Interest: A guide to the Local Authorities (Members’ Interests) Act 1968 and non-pecuniary conflicts of interest for further guidance (August 2004, ISBN 0-478-18121-3).

2: We acknowledge there are other types of expenditure by an entity that, while not within this definition, may also be considered sensitive by nature (for example, because of having a large social, economic, or environmental effect that is of public interest).

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