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auDA Forensic Accounting "PPB Investigation and Report" release

Discussion in 'Domain News' started by DomainNames, Oct 12, 2017.

  1. DomainNames

    DomainNames Membership: Community

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    1. When will auDA / auDA Board announce, publish / release the "PPB Investigation and Report" for stakeholders to read and be informed of?
    2. What will auDA/ auDA Board do about the "PPB Investigation and Report" and the recommendations.
    3. When will auDA/ auDA Board take action on what has been brought to their attention in the "PPB Investigation and Report" ?
    https://auda.org.au/about-auda/our-org/board-meetings/
    14 August 2017
    au Domain Administration Limited- Board Meeting
    Date: Monday 14 August 2017 Time: 9:00AM Location: PwC, Level 19, 2 Riverside Quay, Southbank
    7. Matters for Decision

    b. Governance Items
    iii. PPB Investigation and Report (CEO)

    https://www.auda.org.au/about-auda/our-org/board/
    • Governance Committee: Sandra Hook (Chair), Erhan Karabardak, Tim Connell, Gavin Gibson
    https://www.auda.org.au/about-auda/our-org/constitution/
    "3.2 Activities
    Without reducing the effect of clause 4, auDA will see to achieve its principal purposes as set out in clause 3.1 through:
    a. ensuring the continued operational stability of the domain name system in Australia;
    b. establishing mechanisms to ensure it is responsive and accountable to the supply and demand sides of the Australian Internet Community;
    c. the promotion of competition in the provision of domain name services;
    d. the promotion of fair trading;
    e. the promotion of consumer protection;
    f. adopting open and transparent procedures which are inclusive of all parties having an interest in use of the domain name system in Australia;
    g. ensuring its operations produce timely outputs which are relevant to the needs of the Australian Internet Community.
    (Amended by Special Resolution, 14 August 2006)"

    https://www.auda.org.au/news/outcomes-of-the-independent-review-into-the-governance-of-au
    https://www.auda.org.au/news/statement-from-the-auda-board/
     

    Attached Files:

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  2. DomainNames

    DomainNames Membership: Community

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    https://www.righttoknow.org.au/request/au_historical_financial_irregula
    ".au Historical Financial Irregularities
    Ron Andruff made this Freedom of Information request to Department of Communications and the Arts

    From: Ron Andruff
    Delivered September 15, 2017

    Dear Department of Communications and the Arts,

    We hereby make a request under the Freedom of Information Act 1982 (Cth) ("Act") to access certain documents relating to .au Domain Administration Ltd ("auDA"), as more fully described below.

    1. About auDA

    auDA is the administrator of the Domain Name System in Australia endorsed by the Australian Government to administer the .au domain space. Clause 19.8 of auDA's constitution states that a "representative of the Commonwealth of Australia may attend any meeting of the Board of.. [auDA] as an observer". We understand that the Department of Communications and the Arts is currently an observer on the auDA board.

    2. Background to the request

    Historically, auDA's leadership was driven by CEO (Chris Disspain) and Chair (The Hon. Tony Staley AO), each of whose tenures lasted for more than 15 years. According to the Cameron Ralph Report 2016, which forms the best practice standard of auDA's corporate governance (accessible here - https://www.auda.org.au/assets/Uploads/C... ), "While these long-standing relationships have had considerable strengths, they have also continued early patterns of fairly informal Board practices over a period of some 15 years" which, arguably, "have not kept pace with auDA's growth in scale and importance to the Australian community, nor with evolving good practice in governance and accountability". In light of this alleged lack of governance, accountability and transparency, the newly appointed CEO and management has taken initiatives in the past 12 months to introduce various organisational and administrative policies to reform auDA's governance framework.

    As part of these initiatives, a forensic review of auDA's historical expense management practices was performed to ensure accountability on expenditure in general. According to slide six of the CEO presentation given at the Special General Meeting on 31 July 2017 (accessible here - https://www.auda.org.au/assets/pdf/SGM/a... ), the Board of auDA ("Board") appointed PPB Advisory, which specialises in undertaking forensic investigations and investigating fraudulent activities, to conduct an independent forensic review of auDA's expense management in two phases ("PPB Review") as follows:

    • Phase 1: travel and expenses review under instructions from Maddocks commencing in February 2016; and
    • Phase 2: forensic investigation under instructions from Ashurst commencing in September 2016.

    Slide seven of that presentation summarises the findings of the PPB Review as follows:

    "The review of travel and expenses identified there was a lack of formal policies and procedures governing how travel and expenses were managed at auDA. There were high levels of expenditure on international travel and reimbursement arrangements with international bodies that lacked transparency, which should have warranted a more robust process;.. There was general a lack of formal procedures and supporting documentation."

    It is our understanding that PPB Advisory has prepared a report (or potentially, a series of reports) in relation to the PPB Review ("PPB Report"). According to item 6 of the minutes of the Board meeting held on 10 October 2016 (accessible here - https://www.auda.org.au/assets/auDA-Boar... ), the findings of the PPB Review were "based on staff interviews and included IT, Finance, Complaints Management, HR and Administration".

    According to item 4(a) of the minutes of the Board meeting held on 13 February 2017 (accessible here - https://www.auda.org.au/assets/Board/201... ), it appears that the final version of the PPB Report was considered as follows:

    "4. Matters for decision
    a. PPB Final Report

    Peter Morris, Partner at PPB Advisory, provided an overview of Phase 1 and Phase 2 of the investigation to Directors.

    Lawyers at Ashurst provided advice to the Board.

    The Board agreed that the under-reporting of FBT [Fringe Benefit Tax] to the ATO [Australian Taxation Office] needs to be investigated further.

    The Board note the findings and recommendations of the report. The Board note initial recommendations have been implemented. The Board instruct the CEO to continue to implement governance improvements."

    Further, item 4(c) of the minutes of the Board meeting held on 24 April 2017 (accessible here - https://www.auda.org.au/assets/Board/201... ) states that:

    "The CFO advised the Board that PwC have been engaged to assist with the voluntary disclosure of under-reporting of FBT identified during the PPB investigation."

    3. Requested documents

    In light of the above, we request access to the following documents:

    • a copy of the PPB Report;
    • copies of any findings or reports relating to "the under-reporting of FBT to the ATO" as noted in item 4(a) of the minutes of the Board meeting held on 13 February 2017;
    • internal meeting minutes or any other record (in any form) of matters discussed at in-camera discussions held during auDA's board meeting on 24 March 2016 relating to the termination of the ex-CEO Chris Disspain (excluding the board minutes dated 24 March 2016 which are published on the auDA website); and
    • copies of any reports or other records relating to expenses incurred by the ex-CEO Chris Disspain during the period(s) the subject of the PPB Review and rational for extensive international travel and explanation of benefit to auDA and the Australian public in general,

    (together, "Requested Documents").

    In seeking disclosure of the Requested Documents, we note that there are a number of public interest considerations in favour of disclosure as follows:

    • Promotion of the objects of the Act
    There have been substantial public discussions within the general IT and internet domain community regarding the allegations of financial irregularities and the lack of corporate governance by the former auDA CEO, Chris Disspain, and management. Disclosure of the Requested Documents would be in line with the overall objectives of the Act, allowing inquiry into possible deficiencies in the conduct or administration of auDA, revealing any past improprieties and providing a clear background to what informed the overhaul of the auDA's management and its governance policies.

    • Inform debate on a matter of public importance
    Given the domain .au is used by millions of Australian businesses, organisations and individuals every day, auDA's corporate governance and transparency are a matter of public importance. It is vital for the public to understand why and what changes were made to auDA's governance structure and practices so that they can have confidence that auDA, the sole administrator of Australia's internet infrastructure, is stable and reliable. In particular, the PPB report would provide details as to the under-reporting of Fringe Benefits Tax, alongside other potential financial irregularities. It is in the public interest to disclose this document so that such information can be public knowledge, thus allowing for a greater public understanding and oversight of the management of a policy authority that has been formally endorsed by the Australian Government as the appropriate body to administer Australia's top level domain. Without disclosure of such pertinent information, the public is left in the dark as to how such an important national body has been managed.

    • Increasing public scrutiny, discussion and review of decision-making by auDA
    As acknowledged in the letter of endorsement provided by the Minister for Communications, Information Technology and the Arts, the internet naming system is a public resource in the sense that its functions must be administered in the public or common interest. As such, it would be in the public interest for the information that is contained within the Requested Documents to be within the public domain so that there is greater transparency on the processes associated with the governance of one of the key mediums of communication in Australia, the internet, and Australia's top level domain, .au.

    We look forward to hearing from you and please let us know if you require further information or would like to discuss.

    Yours faithfully,
    Ron Andruff"
     
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  3. DomainNames

    DomainNames Membership: Community

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    "From: FOI
    Department of Communications and the Arts
    September 21, 2017

    [​IMG] image001.png
    2K Download

    [​IMG] image002.gif
    0K Download

    UNCLASSIFIED

    FOI 20-1718

    Dear Mr Andruff

    I refer to your email dated 15 September 2017 outlining a request for access under the Freedom of Information Act 1982 (FOI Act) to: …

    • a copy of the PPB Report;

    • copies of any findings or reports relating to "the
    under-reporting of FBT to the ATO" as noted in item 4(a) of the minutes of
    the Board meeting held on 13 February 2017;

    • internal meeting minutes or any other record (in any form)
    of matters discussed at in-camera discussions held during auDA's board
    meeting on 24 March 2016 relating to the termination of the ex-CEO Chris
    Disspain (excluding the board minutes dated 24 March 2016 which are
    published on the auDA website); and

    • copies of any reports or other records relating to expenses
    incurred by the ex-CEO Chris Disspain during the period(s) the subject of
    the PPB Review and rational for extensive international travel and
    explanation of benefit to auDA and the Australian public in general …”

    Timeframe for receiving your decision:

    Please note that we will process your request in accordance with the
    Department’s [1]FOI Policy and that the 30 day statutory period for
    processing the request commenced on 16 September 2017. You should
    therefore expect a decision from us by 15 October 2017. The period of 30
    days may be extended in certain circumstances. We will advise you if
    there is any extension of time.

    Scope of request:

    If it emerges that the scope of the request is unclear or is too large for
    processing, the Department will contact you to discuss re-scoping the
    request.
    Charges:

    Please note that it is the Department’s policy to issue charges for
    processing FOI requests and that we will advise you of the estimated
    charges when we are in a position to estimate the resources required to
    process the request.

    Timing of release:

    As the subject matter of the request will require the Department to upload
    any documents released to you to the Department’s FOI Disclosure Log, I
    take this opportunity to advise you that the Department’s policy is to
    upload documents to the disclosure log on the same day as or as soon as
    practicable after the documents are released. More information on the
    Department’s disclosure log is available in the FOI Policy.

    Personal Information:

    Your personal information has been collected by the Department as a result
    of your correspondence, and will be used in order to process the FOI
    request. Personal information is protected by law, including the Privacy
    Act 1988. The Department’s [2]Privacy Policy is available on the website
    and contains information about access to or correction of your personal
    information, and how you may complain about a breach of your privacy.



    Please note that if we need to consult with other people regarding release
    of the requested documents, we may need to disclose your personal
    information. When we consult with other people about the request, it may
    be apparent to those people that you have made a request, even if we do
    not disclose your identity. If you have concerns about the Department
    consulting with other people about the request, please let us know about
    these concerns.



    Yours sincerely,

    [3]cid:C4234CC5-D32A-44FF-A754-F96227B373F7
    FOI Coordinator / Information Law Section / Office of the General
    Counsel
    Department of Communications and the Arts
    P +61 2 6271 1277
    E [Department of Communications and the Arts request email]
    GPO Box 2154 Canberra ACT 2601
    [4]communications.gov.au
    [5]cid:17F0759F-5B67-41BB-B991-66700A2CA00A
    [6]@CommsAu
    [7]arts.gov.au
    [8]cid:17F0759F-5B67-41BB-B991-66700A2CA00A [9]@artsculturegov "
     
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  4. snoopy

    snoopy Membership: VIP

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    Release the report AUDA, and the Deloitte report aswell which rumor has it is being withheld from members because it is not overly positive on direct registrations.
     
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  5. DomainNames

    DomainNames Membership: Community

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    Will the Australian Federal Police, ACCC, ASIC get involved?... Another rumour and question "Did auDA pay any Directors legals fees or other expenses in breach of the Corporations Act?"

    auDA needs to release the report asap

    Meanwhile auDA seemingly wants to keep the .au wholesale prices high....and their money coming in so they can continue to blow it..even though in 2008 it was supposed to decrease.

    http://www.theage.com.au/small-busi...n-name-owners-ripped-off-20170807-gxqpzs.html

    https://www.crn.com.au/news/118m-payday-for-melbourne-domain-name-firm-407350

    Ausregistry By AusRegistry Team| February 26th, 2009

    https://www.ausregistry.com.au/auda-extends-ausregistrys-au-registry-term-to-2014/

    "new pricing that sees a drop in AusRegistry's wholesale price to $14 (for a two-year licence) for .com.au and .net.au domains and further drops as volumes increase."

    "auDA today announced that it has extended its au Registry Licence Agreement with AusRegistry. AusRegistry will now continue as Registry Operator and wholesale provider for all commercial domain names including .com.au and .net.au and non-commercial domain names, .gov.au and .edu.au until 2014.

    The extension of the term is the direct result of the independent Industry Competition Panel that was established by .au Domain Administration (auDA) in May 2008. The panel was appointed by auDA to review auDA’s competition model for the Australian Domain Name Industry and provide recommendations to the auDA board on what changes (if any) should be made to the competition model.

    Among the many recommendations of the Panel was the following:

    “Recommendation 2: The Panel recommends that auDA negotiates with the current registry operator with a view to extending the current registry licence term by up to 4 years. Such an extension should be subject to agreement being reached on (a) a suitable pricing model and (b) the inclusion of all items that auDA would require in a new license.”

    Chris Disspain, CEO of auDA said,

    “Based on the recommendations of the independent panel we entered into discussions with AusRegistry to renegotiate the Licence Agreement. I am delighted we have been able to reach agreement. auDA believes that AusRegistry continues to excel in its role as Registry Operator and provides unprecedented support and competitive pricing for the .au namespace.”

    The major points of the renegotiated Licence Agreement include:
    • extended Customer Support Hours for Registrars
    • funding towards Marketing and Market Research
    • a $0.25 donation to the auDA Foundation for every .com.au and .net.au domain renewal and new registration
    • the implementation of DNSSEC
    • commitment to yearly independent Security Audits
    • continued improvement and enhancement of the Registry Software
    • new pricing that sees a drop in AusRegistry’s wholesale price to $14 (for a 2 year licence) for .com.au and .net.au domains and further drops as volumes increase.
    AusRegistry CEO, Adrian Kinderis, said,

    “We are obviously extremely happy to have reached agreement to extend the licence. We are very proud of the role we have preformed as Registry Operator since 2002 and look forward to continuing to show the world .au is at the forefront of Domain Name Registry technology.”

    By AusRegistry Team| February 26th, 2009|News"

    auDA Posted by Jo Lim on 26 February 2009

    https://www.auda.org.au/news/auda-extends-ausregistrys-au-registry-term-to-2014/
    "new pricing that sees a drop in AusRegistry's wholesale price to $14 (for a two-year licence) for .com.au and .net.au domains and further drops as volumes increase."

    auDA extends AusRegistry's .au registry term to 2014
    Posted by Jo Lim on 26 February 2009

    auDA today announced that it has extended its .au Registry Licence Agreement with AusRegistry. AusRegistry will now continue as Registry Operator and wholesale provider for all commercial domain names including .com.au and .net.au and non-commercial domain names, .gov.au and .edu.au until 2014.

    The extension of the term is the direct result of the independent Industry Competition Panel that was established by .au Domain Administration (auDA) in May 2008. The panel was appointed by auDA to review auDA’s competition model for the Australian Domain Name Industry and provide recommendations to the auDA board on what changes (if any) should be made to the competition model.

    Among the many recommendations of the Panel was the following;

    “Recommendation 2: The Panel recommends that auDA negotiates with the current registry operator with a view to extending the current registry licence term by up to 4 years. Such an extension should be subject to agreement being reached on (a) a suitable pricing model and (b) the inclusion of all items that auDA would require in a new license.”

    Chris Disspain, CEO of auDA said, “Based on the recommendations of the independent panel we entered into discussions with AusRegistry to renegotiate the Licence Agreement. I am delighted we have been able to reach agreement. auDA believes that AusRegistry continues to excel in its role as Registry Operator and provides unprecedented support and competitive pricing for the .au namespace.”

    The major points of the renegotiated Licence Agreement include;

    · extended Customer Support Hours for Registrar

    · funding towards Marketing and Market Research

    · a $0.25 donation to the auDA Foundation for every .com.au and .net.au domain renewal and new registration

    · the implementation of DNSSEC

    · commitment to yearly independent Security Audits

    · continued improvement and enhancement of the Registry Software

    · new pricing that sees a drop in the AusRegistry wholesale price to $14 (for a 2 year licence) for com.au and net.au domains and further drops as volumes increase

    AusRegistry CEO, Adrian Kinderis, said, “We are obviously extremely happy to have reached agreement to extend the licence. We are very proud of the role we have preformed as Registry Operator since 2002 and look forward to continuing to show the world the .au is at the forefront of Domain Name Registry technology.”





     
  6. snoopy

    snoopy Membership: VIP

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    Screen Shot 2017-10-13 at 8.54.57 am.png
     
  7. DomainNames

    DomainNames Membership: Community

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  8. snoopy

    snoopy Membership: VIP

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    Well spotted Sean.
     
  9. DomainNames

    DomainNames Membership: Community

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    Wait till the world media and domain forums picks up on this FOI request and the items it raises..

    ICANN is the big league...

    Will this FOI be blocked some how by auDA?


    It raises valid points about "public interest" and many others as reasons for it being released

    Did the auDA Board have this info last year at the AGM?

    So there is previous years of accounts issues people have signed off on for how long?

    What are members being told and asked to vote on if we do not know the true facts and accounts?

    Who will be paying back any money and the related Fringe Benefits Taxes or will this just be taken out of auDA funds again?

    Why is this all hidden from auDA Members?

    https://www.auda.org.au/about-auda/our-org/constitution/
    "3.2 Activities

    Without reducing the effect of clause 4, auDA will see to achieve its principal purposes as set out in clause 3.1 through:
    a. ensuring the continued operational stability of the domain name system in Australia;
    b. establishing mechanisms to ensure it is responsive and accountable to the supply and demand sides of the Australian Internet Community;
    c. the promotion of competition in the provision of domain name services;
    d. the promotion of fair trading;
    e. the promotion of consumer protection;
    f. adopting open and transparent procedures which are inclusive of all parties having an interest in use of the domain name system in Australia;
    g. ensuring its operations produce timely outputs which are relevant to the needs of the Australian Internet Community.

    (Amended by Special Resolution, 14 August 2006)"
     
  10. DomainNames

    DomainNames Membership: Community

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    https://www.righttoknow.org.au/request/au_historical_financial_irregula

    https://icannwiki.org/Ron_Andruff
    "Mr. Andruff is a member of the Business Constituency at ICANN.[3] He was a member of the ICANN Nominating Committee 2013 and 2014, Chair-Elect 2015; as well as former Chair of the Standing Committee on GNSO Improvements Implementation (SCI)2011-13."
    [​IMG]

    https://www.linkedin.com/in/ron-andruff-b293319/
    ICANN - The Internet Corporation for Assigned Names and Numbers
    Dates Employed 1999 – Present
    Employment Duration 18 yrs

    Most recently, member of the 2013 and 2014 Nominating Committee, prior to being selected by the ICANN Board to become 2015 Chair-Elect (“NomCom” http://www.icann.org/en/groups/nomcom/2014). The Nom Com selects Directors for the ICANN Board as well as other appointees for leadership positions on key policy development bodies within ICANN. Past Chairman and member of the ICANN Standing Committee for GNSO Policy Improvements Implementation (“SCI”), which works through thorny GNSO Council process/policy implementation issues; Vice Chair of the Implementation Advisory Group for Competition, Consumer Trust and Consumer Choice (IAG-CCT), which is intended to inform a study on metrics around the new gTLD expansion program currently underway within ICANN; and member of the GNSO Review Working Party. [GNSO = Generic Name Supporting Organization]
     
  11. Bacon Farmer

    Bacon Farmer Membership: VIP

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    "Expense Management : Overall findings

    The review of travel and expenses identified there was a lack of formal policies and procedures governing how travel and expenses were managed at auDA.

    There were high levels of expenditure on international travel and reimbursement arrangements with international bodies that lacked transparency, which should have warranted a more robust process;

    There was general a lack of formal procedures and supporting documentation. "

    [Slide 7 from the death by slideshow special meeting]

    Was this auDA's summary of the Maddocks report or taken directly from the Maddocks report?

    Was this the ammunition used to fire the CEO?
     
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  12. DomainNames

    DomainNames Membership: Community

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    How many years have stakeholders including auDA paying members from both Supply and Demand been "lied" to about auDA policies, transparency, accountability, facts, expenses, contracts, figures...?

    Where exactly will the money come from to pay all of the Fringe Benefits Tax to the ATO?

    Has any money been repaid? What are the real financial numbers involved?

    Does this mean the many years of previous auDA accounts where all wrong?

    Do any past or remaining auDA Directors have any responsibility? Did they know, not know, should they have known?

    http://asic.gov.au/regulatory-resou...-and-audit/directors-and-financial-reporting/

    This will be raised at the AGM.
     
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  13. Bacon Farmer

    Bacon Farmer Membership: VIP

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    My point is; the summary gives the impression of wrong doing, when in actual fact no money is missing or unpaid (to the ATO) [or is it?].

    Without the actual report to verify anything, we are left with what may actually be hostile subjective summary of the report by the ex CEO's replacement.

    Table the reports!
     
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  14. neddy

    neddy Membership: VIP

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    auDA Member:
    Yes
    Exactly.

    Or as I have said before, "put up or shut up".
     
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  15. DomainNames

    DomainNames Membership: Community

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  16. DomainNames

    DomainNames Membership: Community

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    They did not meet the deadline of today! Maybe trying to stall this out as long as possible until after the AGM?
    https://www.righttoknow.org.au/request/au_historical_financial_irregula

    ".au Historical Financial Irregularities
    Ron Andruff made this Freedom of Information request to Department of Communications and the Arts

    Currently waiting for a response from Department of Communications and the Arts, they must respond promptly and normally no later than October 16, 2017 (details)."

    https://www.righttoknow.org.au/help/unhappy