There are two areas covered by our Governance and Financial Viability Standard. Against each, we have described the outcomes landlords should deliver and our specific expectations of them.
The two areas are:
• governance
• financial viability
Governance
Required outcomes
Registered providers shall ensure effective governance arrangements that deliver their aims, objectives and intended outcomes for tenants and potential tenants in an effective, transparent and accountable manner. Governance arrangements shall ensure they:
• adhere to all relevant legislation
• comply with their governing documents and all regulatory requirements
• are accountable to tenants, the TSA and relevant stakeholders
• safeguard taxpayers’ interests and the reputation of the sector
• have an effective risk management framework
Specific expectations
Registered providers shall adopt and comply with an appropriate code of governance. They shall give the reasons for their choice and explain areas of non-compliance with their chosen code.
Registered providers shall establish and maintain clear roles, responsibilities and accountabilities for their board, chair and chief executive and produce an annual assessment of the effectiveness of their arrangements.
Registered providers shall submit an annual return, on an accurate and timely basis in a form determined by the TSA. This is currently the Regulatory and Statistical Return (and its successor, the National Register of Social Housing).
Where there is a non-regulated element, the registered provider shall demonstrate to the TSA that it has in place effective mechanisms (such as commitments, undertakings or other assurances between itself and the non-regulated element) which ensure that:
• it is and will be able to comply with the TSA's standards and other regulatory requirements
• its ability to meet the TSA's standards and other regulatory requirements is not and cannot be prejudiced by the activities or influence of the non-regulated element
• in the event that the registered provider does not or may not be able to comply with the TSA’s standards or other regulatory requirements:
o the non-regulated element will give any necessary support or assistance to enable compliance
o the registered provider has the ability to require the support or assistance of the non-regulated element to enable compliance.
In some situations it may be appropriate for the TSA to be a party to such arrangements.
Financial viability
Required outcomes
Registered providers shall manage their resources effectively to ensure their viability is maintained.
Specific expectations
Registered providers shall ensure that:
• effective controls and procedures are in place to ensure security of assets and the proper use of public funds
• effective systems are in place to monitor and accurately report delivery of their plans
• the risks to delivery of financial plans are identified and effectively managed
Registered providers shall ensure that they have a robust and prudent business planning and control framework. Through this framework they will ensure:
• there is access to sufficient liquidity at all times
• financial forecasts are based on appropriate and reasonable assumptions
• planning sufficiently considers the financial implications of risks to the delivery of plans
• they monitor, report on and comply with their funders’ financial covenants
Registered providers shall provide to the TSA accurate and timely statutory and regulatory financial returns and an annual report on any losses from fraudulent activity.
