The R Kelly whiteboard case study shows why managing risks associated with record keeping is important. The Auditor General also highlights this importance with the following comments:

'Records are consulted as proof of activity by senior managers, auditors, members of the public or by anyone inquiring into a decision, a process or the performance of an organisation or an individual. As such, they are an appropriate example of not only the importance of good process but also how it often contributes importantly to a myriad of outcomes or results.'

'In addition to legislative requirements, there are several other significant reasons for emphasising the importance of recordkeeping in the public sector. Up-to-date, accessible, relevant and accurate records can ensure that decisions made by an agency are consistent, based on accurate information, cost-effective, engender a sense of ownership of decisions throughout the agency, and place the agency in a considerably better position to justify to Parliament and the public any decisions made. It is often not just outcomes that are of concern to Parliament and the public, but also the process of decision-making and the reasons for decisions made.'

'This transparency is achieved by ensuring that the decision-making process, and the reasons for decisions made, are adequately documented by the agency. Transparency through recordkeeping is an agency's first line of defence against accusations of bias and negative public perceptions. It also promotes confidence in the integrity of the [public sector] and allows the public to perceive the [public sector] as making 'value for money' decisions, especially where procurement is concerned, as well as meeting any requirements for fairness, equity, privacy and freedom of information.'

'As [public sector] agencies move into an era of increasing risk and other management challenges brought about by new ways of delivering services such as outsourcing and the greater use of information technology, there is increasing concern about organisations' ability to preserve those records which are needed to support the delivery of programs and services, and to meet their accountability, as well as archival, obligations.'

'Good records that form an accountability trail are the first line of defence against accusations of bias and/or misinformation.'

Speech by Mr P.J. Barrett (AM) – Auditor-General for Australia Recordkeeping in Commonwealth Agencies: An Audit Perspective. Delivered 11/08/2000 to the National Archives of Australia Advisory Council.

Case study: R Kelly whiteboard (consequences of poor record keeping)

Source: Australian National Audit Report No.9 1993-94 Community Cultural, Recreational and Sporting Facilities Program. Full report can be obtained from the Australian National Audit Office.

The ANAO investigated the processes surrounding the award of certain community cultural, recreational and sporting facilities grants.

The ANAO's audit found that the then Minister had failed to keep adequate records of the reasons for awarding grants to selected projects, and that there were also inadequate records regarding the categories used to make these selections. Therefore, allegations of political bias made by the Opposition could not be resolved. The lack of documentation also meant that there was no audit trail and it was not possible to assess the efficiency and effectiveness of the Minister's decision-making procedures.

The ANAO's findings were endorsed by a subsequent Parliamentary Inquiry and Report, House of Representatives Standing Committee on Environment, Recreation and the Arts 1994. This grants process became infamous in the media as the 'Ros Kelly Whiteboard' situation. Eventually political and public outrage over the apparently poor administration of the grants process and the lack of adequate records about the process led to Ms Kelly's resignation as a Minister.

Risk management issues – record keeping

Creation and retention of records

Every major aspect of public sector activity should be recorded in order to comply with legislative and accountability requirements. But this is not the only reason why good record keeping is important.

Although record keeping is often seen by time pressed public servants as a process which adds little value, it is in fact an extremely important part of the risk management process. Good record keeping allows an organisation to answer questions that may be raised about its activities, often long after the events in question are over. Good records also provide strong evidence of probity, fairness and equity in the application of process, and have been relied upon in court proceedings to justify actions taken or not taken by public servants.

It is also essential that records, once created, are properly retained. This means that they should be available for review some time after the activities recorded have been completed.

Loss of corporate memory

Corporate memory is all the information that staff know about how an organisation does business and how and why things have happened in the past. This information can be stored in paper records, electronic records or simply in an individual's memory.

Loss of corporate memory has become a more significant risk management issue for the public sector in recent years. Trends towards high turnover of staff, outsourcing and competitive tendering and contracting have seen an enormous drain on the corporate memory, especially in organisations where a large part of the corporate memory has not been fully documented. This risk may be treated, quite effectively, by the creation and maintenance of proper records. These records should cover all aspects of the relevant process, especially any decisions made and the criteria used to make them.

Performance improvement

Records which show an organisation's performance history are important in allowing the organisation to monitor its performance and benchmark itself against other organisations. This information can be used to improve performance, or to answer questions about performance, thus having clear links to sound accountability and good corporate governance.

Good record keeping is also a recognised deterrent to fraud, because it increases the likelihood of the fraud being detected in a timely manner.

Timeliness of records

Records should be created contemporaneously with the events that they record. Whenever there is a delay in creating records, it is inevitable that recollections of events will have to rely, at least to some extent, on the memories of those involved. Delay increases the likelihood of discrepant memories of events and creates the possibility to colour reporting of events with the benefit of hindsight. This is not appropriate for high standards of public administration and accountability.

Accountability and transparency

It is a fundamental principle of public sector accountability and risk management that decisions are made on the basis of a fair and equitable treatment of all people. The investigation of outrage, included in the risk management section of this website, shows that the public are likely to be outraged by any action that appears to involve the cover up of government actions or that appears to involve a double standard. Sound risk management principles suggest that the public sector should be interested in keeping outrage to a minimum.

Good record keeping assists in containing outrage and thus risk, by meeting the public sector's accountability and transparency of process obligations. Good records provide contemporaneous information about how decisions were reached, are evidence of probity in the decision making process and can be used to defend against allegations of appearing too political.

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