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Tertiary Education Quality and Standards Agency (TEQSA)—Report for 2019-20


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Annual Report

2019-20

TEQSA Annual Report 2019-20 ISSN 2200-9671 (print)

ISSN 2201-2729 (online)

Copyright © Commonwealth of Australia 2020. The material in this Annual Report is licensed under a Creative Commons Attribution—4.0 International licence, with the exception of:

• the Commonwealth Coat of Arms

• TEQSA’s logo

• any third party material

• any material protected by a trademark

• any images and/or photographs.

More information on this CC BY licence is set out as follows:

• Creative Commons website—creativecommons.org

• Attribution 4.0 international (CC by 4.0)—creativecommons.org/licenses by/4.0

Enquiries about this licence and any use of this report can be sent to: enquiries@teqsa.gov.au

The document must be attributed as the TEQSA Annual Report 2019-20.

ACCESSING THIS REPORT ONLINE

More information about the Tertiary Education Quality and Standards Agency is available at www.teqsa.gov.au.

The electronic version of this report can be found at www.teqsa.gov.au/about-us/publications.

CONTACT US

Enquiries about this report may be directed to:

Manager, Executive Office Tertiary Education Quality and Standards Agency Level 14, 530 Collins Street MELBOURNE VIC 3001

T: 1300 739 585 E: enquiries@teqsa.gov.au W: www.teqsa.gov.au

ACKNOWLEDGEMENTS

This report reflect the efforts of many people. Special thanks go to the TEQSA staff involved in contributing and coordinating material.

TEQSA | Annual Report 2019-20 I

Letter of transmittal

The Hon Dan Tehan MP Minister for Education Parliament House CANBERRA ACT 2600

Dear Minister,

Subject: Tertiary Education Quality and Standards Agency Annual Report 2019-20

As the accountable authority of the Tertiary Education Quality and Standards Agency (TEQSA), we have pleasure in presenting to you the agency’s annual report for the year ended 30 June 2020.

TEQSA’s annual report has been prepared in accordance with section 46 of the Public Governance, Performance and Accountability Act 2013 (the PGPA Act). Subsection 46(1) of the PGPA Act requires the accountable authority of the entity to give an annual report to the entity’s responsible Minister for presentation to Parliament.

In addition, we, as the accountable authority of TEQSA, present the 2019-20 annual performance statements of TEQSA, as required under paragraph 39(1)(a) of the PGPA Act. In our opinion, these annual performance statements are based on properly maintained records, accurately reflect the performance of the entity, and comply with subsection 39(2) of the PGPA Act.

Furthermore, we certify that TEQSA:

a. has prepared fraud risk assessments and fraud control plans

b. has in place appropriate fraud prevention, detection, investigation and reporting mechanisms that meet the specific needs of the agency

c. has taken all reasonable measures to appropriately deal with fraud relating to the agency.

This report describes the progress made over the course of 2019-20 to advance national action to assure the quality of higher education in Australia. This work continues through the staff of TEQSA and a range of stakeholders in the higher education sector.

Yours sincerely,

Professor Nicholas Saunders, AO Professor Joan Cooper

Chief Commissioner Commissioner

Professor Peter Coaldrake, AO Professor Cliff Walsh

Commissioner Commissioner

28 August 2020

II ABOUT THIS REPORT

About this report

This report informs The Hon Dan Tehan MP, Minister for Education; the Parliament of Australia; the Australian higher education community; and the general public about the performance of the Tertiary Education Quality and Standards Agency (TEQSA or the agency) during the financial year ending 30 June 2020.

Prepared according to parliamentary reporting requirements, the report describes TEQSA’s achievements against the objectives and actions set out in the TEQSA Corporate Plan 2019-23 and in TEQSA’s 2019-20 Portfolio Budget Statements.

Contents Section 1: Review by the accountable authority 2

Review of the year by the accountable authority 2

Section 2: Agency overview 6

About TEQSA 6

Purpose 6

Legislative framework 6

Organisational structure 7

Section 3: Performance review 14

Response to COVID-19 pandemic 14

Australian National Audit Office performance audit 15

Performance against objectives 17

Objective 1: Quality assure and regulate the sector in a timely, transparent and risk-reflective manner 17

Objective 2: Support providers to deliver quality higher education, protect student interests and enhance the reputation and competitiveness of Australia’s higher education sector 37

Objective 3: Provide advice and information to inform decisions about the appropriateness and quality of Australian higher education 40

Objective 4: Taking prompt and effective action to address substantial risks to students or the reputation of the sector 46

Analysis of TEQSA’s financial performance 50

TEQSA | Annual Report 2019-20 III

Section 4: Management and accountability 52

Corporate governance 52

Human resources 58

Corporate services 61

Financial management 61

Section 5: Financial report 66

Independent Auditor’s report 66

Statement by the accountable authority and Chief Financial Officer 70

Financial statement 71

Section 6: Appendices 108

Appendix A: Legislative framework 108

Appendix B: Summary of resources 110

Appendix C: Staffing profile 113

Appendix D: Freedom of Information 119

Appendix E: Ecologically-sustainable development and environmental performance 119

Appendix F: Advertising and market research 119

Appendix G: Workplace health and safety 119

Appendix H: Complaints handling 120

Appendix I: Disability reporting 120

Appendix J: Corrections to previous annual report 120

Section 7: Indices and references 124

Acronyms and abbreviations 124

Glossary of terms 125

Compliance index 129

Alphabetical index 142

IV IV IV IV

TEQSA pivoted quickly to support the sector in response to the impact of the COVID-19 pandemic, and was in contact with providers to understand the challenges they were facing.

IV IV

Review by the accountable authority

Review by the accountable authority

1

2 Section 1 | REVIEW BY THE ACCOUNTABLE AUTHORITY

Section 1: Review by the accountable authority

This is the ninth annual report of the Tertiary Education Quality and Standards Agency (TEQSA); it describes the performance and achievements of the agency over 2019-20.

The operational year presented many changes and challenges. It was the first complete year, following increased budget funding, that: there was a full complement of staff to deliver the work of the agency; there were changes due to the impact of COVID-19 pandemic on our regulatory approach and the work arrangements of staff; the agency was subject to an Australian National Audit Office (ANAO) performance audit; and there were changes in leadership of the agency.

Response to the impact of the COVID-19 pandemic TEQSA undertook a considerable amount of work to address risks to the quality of higher education provision due to the COVID-19 pandemic. This work included: providing time-limited relief to providers from having to prepare applications for re-registration and re-accreditation; providing a wide range of resources on the TEQSA website to assist providers move to online delivery; working with international quality assurance bodies to address concerns about the quality of online delivery; and working directly with providers and their peak bodies to stay informed about the ongoing impact on the sector. The government gave further relief to providers through refunds and waivers of fees as part of its Higher Education Relief Package.

The agency’s approach to supporting the sector in managing the impact of the COVID-19 pandemic, which TEQSA staff undertook while also transitioning to remote working arrangements, received very positive feedback from providers.

TEQSA’s performance in 2019-20 Following TEQSA’s focus on recruitment and training of staff in 2018-19, the agency began to see the benefits in 2019-20 of the increased scope of activities undertaken and improvements in performance.

The agency cleared much of the backlog of re-registration assessments from previous years and did further work on improving the delivery of its assessment functions. There were improvements in the timeliness of decisions where assessment of applications did not find compliance issues and there was also a 43 per cent increase in the number of assessments completed in 2019-20 compared to the previous year.

In addition to delivering webinars during the pandemic about online learning, there was a solid program of engagement with the sector during 2019-20. This included a very well attended and received TEQSA Conference; consultations about the review

TEQSA | Annual Report 2019-20 3

of the TEQSA risk assessment framework attended by 80 per cent of providers; twenty workshops around Australia to promote academic integrity, as well as meetings with professional accreditation bodies, TEQSA’s Student Expert Advisory Group, TEQSA Experts and international quality agencies and networks to discuss quality and regulatory issues.

TEQSA worked closely with the Department of Education, Skills and Employment and the Higher Education Standards Panel on the development of legislation, instruments and policies in relation to contract cheating, freedom of speech, the Australian Qualifications Framework, professional accreditation, credit recognition, Provider Category Standards in the Higher Education Standards Framework, and student records.

Work on the sector-wide issues of the transparency of admission processes, student retention, sexual assault and sexual harassment, and English language admission standards also continued or was initiated during the year to address risks to the reputation of the sector. Sector-wide issues will also be a focus of the recently-announced Higher Education Integrity Unit which will have a focus on data and policy analysis to identify drivers of risk to the integrity of the sector and will employ strategies to address those risks.

The agency chose not to undertake a survey of stakeholders in 2020 in light of the pressures on providers due to the pandemic and, consequently, some aspects of TEQSA’s performance were not able to be measured against some targets set out in the Corporate Plan 2019-23 that relied on the results of the survey. In addition, some activities (Cycle 7 risk assessment, the compliance review of ELICOS providers and the consultation on revised cost recovery arrangements) were not undertaken due to the pandemic. Taking the impact of the pandemic into account, the agency achieved three of its four objectives and partially achieved one objective. Overall, the agency largely achieved its performance objectives against the corporate plan for 2019-20.

ANAO performance audit Between July 2019 and March 2020, the ANAO undertook a performance audit of TEQSA’s regulation of high education. The audit found that TEQSA was effective or largely effective in all but the area of compliance and enforcement activities, which was an area where improvement initiatives were underway or had been planned. The audit required dedicated internal resourcing from its commencement until the report was finalised and provided the agency with further insights into improving operations.

Leadership changes In January 2020, the agency farewelled Dr Lin Martin AO as a TEQSA Commissioner. Dr Martin joined TEQSA in 2015 and was instrumental in the agency’s approach to equity and higher education administration.

In March 2020, the agency farewelled Mr Anthony McClaran as the TEQSA Chief Executive Officer. Mr McClaran joined TEQSA in 2015 and led the agency in its reformed relationship with the sector, approach to engagement and the recent growth of the agency.

4 Section 1 | REVIEW BY THE ACCOUNTABLE AUTHORITY

In May 2020, Emeritus Professor Peter Coaldrake AO commenced as a TEQSA Commissioner, having recently completed the review of the Provider Category Standards of the HES Framework.

Looking forward The commencement of revised cost recovery arrangements was delayed by the government to July 2021 due to the disruption caused by the pandemic.

TEQSA has developed a revised approach to risk assessments to monitor the financial impact of the pandemic on providers and will provide the government with advice regarding the financial standing of the sector.

TEQSA will, in addition to monitoring risks due to the disruption caused by the pandemic on providers, continue to support the welfare of TEQSA staff for the benefit of staff wellbeing and the productivity of the agency.

In 2021, changes to TEQSA’s information technology and information management, which began in 2019-20, will continue to contribute improvements to the operation of the agency including increasingly sophisticated approaches to monitoring risks. Through its new Higher Education Integrity Unit, the agency will be building on the work undertaken to date on academic integrity. This work will include using the new legislation that enables the blocking of websites offering contract cheating services and working with the sector to develop strategies to address identified other risks to the interests of students and to the reputation of the sector.

Professor Nicholas Saunders AO Chief Commissioner on behalf of the accountable authority

Agency overview

2About TEQSAPurposeLegislative frameworkOrganisational structure

6 Section 2 | AGENCY OVERVIEW

Section 2: Agency overview

About TEQSA TEQSA is Australia’s independent national quality assurance and regulatory agency for higher education. All providers that offer higher education qualifications in or from Australia must be registered by TEQSA. Providers that have not been granted self-accrediting authority (SAA) must also have their courses of study accredited by TEQSA.

Purpose TEQSA’s purpose is to protect student interests and the reputation of Australia’s higher education sector through a proportionate, risk-reflective approach to quality assurance that supports diversity, innovation and excellence.

TEQSA has four strategic objectives in delivering its purpose. TEQSA will:

1. quality assure and regulate the sector in a timely, transparent and risk reflective manner

2. support providers to deliver high quality higher education, protect student interests and enhance the reputation and competitiveness of Australia’s higher education sector

3. provide advice and information to inform decisions about the appropriateness and quality of higher education

4. take prompt and effective action to address substantial risks to students or the sector’s reputation.

Legislative framework TEQSA’s guiding legislation is the Tertiary Education Quality and Standards Agency Act 2011 (the TEQSA Act). The TEQSA Act confers powers and functions on TEQSA, among other things, to:

> register regulated entities as registered higher education providers and accredit courses of study

> conduct compliance assessments and quality assessments

> provide advice and make recommendations to the Commonwealth Minister responsible for Education on matters relating to the quality and regulation of higher education providers

> cooperate with similar agencies in other countries

> collect, analyse, interpret and disseminate information relating to quality assurance practice and quality improvement in higher education.

TEQSA | Annual Report 2019-20 7

Under the Education Services for Overseas Students Act 2000 (ESOS Act), TEQSA also has responsibility as an ESOS agency for regulating all providers delivering higher education to overseas students studying in Australia.

Taken together, the legislative frameworks of these two Acts incorporate the following quality standards:

> the Higher Education Standards Framework (Threshold Standards) 2015 (HES Framework)

> the National Code of Practice for Providers of Education and Training to Overseas Students 2018 (National Code)

> the Foundation Program Standards (Foundation Standards)

> the ELICOS Standards 2018 (ELICOS Standards).

In addition, the agency has responsibilities under several other Acts and Rules. See Appendix A: Legislative framework for more information about these responsibilities.

Organisational structure

Figure 1: TEQSA’s organisational structure, as at 30 June 2020

Commissioners and accountable authority TEQSA currently has four Commissioners: a part-time Chief Commissioner and three part-time Commissioners. TEQSA’s Commissioners are appointed by the Minister for Education based on their expertise in higher education, quality assurance, and regulatory practice. The Commissioners are responsible for making regulatory decisions, setting strategic directions, monitoring risk in the sector, and deciding on matters relating to the development of the agency’s quality assurance and regulatory framework. The Commissioners are also collectively the accountable authority for TEQSA.

Emeritus Professor Nicholas Saunders AO, Chief Commissioner and Acting CEO Professor Saunders joined the agency as Acting Chief Commissioner and Chief Executive Officer (CEO) in September 2014. He was appointed by the then Minister responsible for higher education as TEQSA Chief Commissioner in March 2015 and his appointment was renewed in March 2018.

TEQSA COMMISSION

CHIEF EXECUTIVE OFFICER

Executive O*ce

Legal Engagement Corporate Assurance Policy and

Analysis

Executive Director Regulatory Operations

Assessment and Investigations

8 Section 2 | AGENCY OVERVIEW

Professor Saunders was previously Provost and Deputy Vice-Chancellor of Bond University and prior to that Vice-Chancellor and President of the University of Newcastle, Australia. During his career, Professor Saunders has been Chair of the National Health and Medical Research Council and Chair of the Committee of Deans of Australian Medical Schools. He was also a member of: the Higher Education Council; the Prime Minister’s Science, Engineering and Innovation Council; the Australian Research Council; and the Aboriginal and Torres Strait Islander Health Council. Professor Saunders was also a member of the Board of Universities Australia and Lead Vice-Chancellor for research and international activities.

Professor Saunders has been the Acting CEO of TEQSA since March 2020, when the previous CEO, Mr Anthony McClaran, left the agency to take up the position of Vice-Chancellor at St Mary’s University, UK.

Emeritus Professor Peter Coaldrake AO, Commissioner Professor Peter Coaldrake was appointed as a TEQSA Commissioner in May 2020.

Professor Coaldrake was Vice-Chancellor and CEO of Queensland University of Technology for nearly fifteen years until 2017, and is a former Chair of both Universities Australia and the governing board of the Organisation for Economic Development - Institutional Management in Higher Education.

In 2018, Professor Coaldrake was appointed by the Minister for Education to conduct a review into the Higher Education Provider Category Standards. In 2018, he also undertook two separate reviews for the Queensland government: one dealing with the present and future Queensland public sector workforce, and the other of the future of vocational education, training and skilling in central-western Queensland, focusing on the performance of the Agricultural Colleges.

Professor Coaldrake is currently the Chair of the Board of the Queensland Performing Arts Trust and a Board Member of the Queensland Community Foundation.

Emeritus Professor Joan Cooper, Commissioner Professor Cooper was appointed as a TEQSA Commissioner in April 2019.

Professor Cooper’s most recent work prior to joining TEQSA involved delivering a variety of higher education consultancy services to higher education private providers in Australia. Her roles and services included chairing governance committees; reviews of operational areas; and reviews and preparation for TEQSA registration, renewal of registration, and course accreditation. She has chaired a number of Governing Councils and Academic Boards for private providers, including TAFE NSW.

Professor Cooper has wide-ranging experience both nationally and internationally in tertiary education accreditation and quality audits. She was previously Pro-Vice Chancellor (Students) of the University of New South Wales. Her other senior academic executive positions include Deputy Vice-Chancellor (Academic) at Flinders University, and Dean of Informatics at the University of Wollongong where she served as Chair of the University Senate (Academic Board).

TEQSA | Annual Report 2019-20 9

Dr Linley Martin AO, Commissioner Dr Linley (Lin) Martin was appointed as a TEQSA Commissioner in February 2015. Her appointment was renewed in February 2018 and her term ended in January 2020.

Prior to her role at TEQSA, Dr Martin was the Head of University Services and Vice-Principal (Major Projects) at the University of Melbourne, where she had also held the position of Vice Principal and Academic Registrar. She has held a number of senior positions at universities including as the Vice-President and Council Secretary at Deakin University.

Dr Martin was also a senior adviser to the Review of Australian Higher Education (the Bradley Review) which was pivotal to the establishment of TEQSA.

Emeritus Professor Cliff Walsh, Commissioner Professor Walsh was appointed as a TEQSA Commissioner in February 2014 and his appointment was renewed in February 2018.

He has held professorial appointments at the University of Adelaide and the Australian National University, and visiting appointments at universities in Canada, the US and the UK. His teaching, research, publications and advisory specialities have included: public sector economics and public policy; regulatory theory and its application to economic, social and environmental issues; and economic and social evaluation of public sector programs and regulatory regimes.

Professor Walsh has also been a member of the quasi-judicial Australian Competition Tribunal which reviews, on appeal, decisions of Australia’s competition regulator, the Australian Competition and Consumer Commission.

He is currently Emeritus Professor of Economics at the University of Adelaide, and a Visiting Research Fellow in the School of Economics.

Chief Executive Officer

Mr Anthony McClaran, Chief Executive Officer The Chief Executive Officer (CEO) is a full-time position, appointed by the Minister and with responsibility for the management and administration of TEQSA. Mr McClaran was the CEO of TEQSA from October 2015 until March 2020, when he left to take up the position of Vice-Chancellor at St Mary’s University, UK.

Before joining TEQSA, Mr McClaran was the Chief Executive of the UK’s Quality Assurance Agency for Higher Education for six years, and prior to that he was Chief Executive of the UK’s national agency for higher education admissions, the Universities and Colleges Admissions Service.

Mr McClaran has held several leadership positions in the higher education sector, including Academic Registrar, and Acting Registrar and Secretary at the University of Hull. He was Chair of Council and Pro-Chancellor of the University of Gloucestershire from 2007 to 2009.

Mr McClaran has served on the boards of the European Association for Quality Assurance in Higher Education and the International Network of Quality Assurance Agencies in Higher Education (INQAAHE), and has served on the Advisory Council of

10 Section 2 | AGENCY OVERVIEW

the US Council for Higher Education Accreditation (CHEA) International Quality Group since 2016. He was a member of the Audit Committee of the Australian Accounting Standards Board (AASB) and the Auditing and Assurance Standards Board (AUASB).

Executive Director

Ms Prue Monument, Executive Director, Regulatory Operations Ms Monument commenced at the agency in June 2019 as the Executive Director, Regulatory Operations. This role oversees all of TEQSA’s assessment activities including provider registrations, course accreditations, CRICOS assessments, and compliance and investigations.

Prior to joining TEQSA, Ms Monument was the Director of Compliance at the Australian Charities and Not-for-profits Commission (ACNC) where she was responsible for the ACNC’s Compliance directorate, focused on identifying and investigating abuse and mismanagement in Australia’s charity sector.

Ms Monument holds an Executive Master of Public Administration and has over 18 years of public sector experience, including with the Australian Border Force and the Department of Immigration and Border Protection in Australia, China and Lebanon, with a focus on program integrity, compliance and caseload fraud prevention.

Senior Management Team The Senior Management Team (SMT) is comprised of: the CEO; the Executive Director, Regulatory Operations; and TEQSA senior managers. The SMT supports the CEO in discharging their statutory role and provides collective operational leadership for the agency in relation to TEQSA’s operational priorities, including business planning and the management of resources. The SMT reports to the accountable authority through the CEO.

Functional groups TEQSA’s highly skilled staff possess knowledge and expertise in higher education, quality assurance, regulation, risk management and the public sector. Staff members build on their knowledge and experience through regular interactions with providers, professional accreditation bodies, TEQSA experts and overseas quality assurance bodies.

TEQSA’s staff come from diverse backgrounds, including higher education delivery, data collection, data analysis, risk management, financial analysis, regulation and government. They apply their specialised skills in assessing complex qualitative and quantitative information, with a focus on protecting the interests of students and the reputation of the higher education sector, by:

> ensuring that higher education providers meet the HES Framework

> promoting good practice

> improving the quality of the Australian higher education sector.

TEQSA | Annual Report 2019-20 11

The functional groups that made up the agency as at 30 June 2020 are outlined below.

Regulatory Operations The Regulatory Operations Group is a new team focused on coordinating and delivering strategic projects to improve TEQSA’s operational activities. This includes strategies to: streamline assessment activities, improve TEQSA’s partnership approach, and build the capabilities of assessment staff. The group also coordinates operational reporting.

Assessment and Investigations Group and Assurance Group The Assurance Group and the Assessment and Investigations Group are responsible for delivering TEQSA’s core business of undertaking regulatory assessment under the TEQSA Act (using the HES Framework) and the ESOS Act (using the National Code, ELICOS Standards and Foundation Program Standards). This work is critical to ensuring higher education providers meet the requirements of the TEQSA and ESOS frameworks, and monitoring and improving the quality of the Australian higher education sector.

The Assessment and Investigations Group is responsible for: assessing applications for initial provider registration; assessing applications made under the ESOS Act; managing complaints about providers; managing provider notifications of material changes; conducting compliance assessments and investigations; and conducting reviews of conditions imposed on registration and course accreditation.

The Assurance Group is responsible for assessing applications for: renewal of registration (re-registration); accreditation and renewal of accreditation (re-accreditation) of courses; authority to self-accredit one or more courses; and change of provider category.

Legal Group TEQSA’s Legal Group, led by the General Counsel, is responsible for legal services required by TEQSA as a Commonwealth regulatory agency, including providing TEQSA staff with strategic legal advice and training on legal issues, managing claims by or against TEQSA, and managing Administrative Appeals Tribunal (AAT) matters. The group is also responsible for internal quality assurance of TEQSA’s assessment processes and policies, with a particular focus on maintaining TEQSA’s Case Management Handbook.

Policy and Analysis Group The Policy and Analysis Group is responsible for the enhancement of TEQSA’s regulatory outcomes and future direction through ongoing improvements to regulatory policy, business improvement, strategic projects, and quantitative and qualitative analysis.

The Policy and Analysis Group also coordinates strategic projects; sector assessments; provider risk analysis; financial assessment of providers; and the collection, storage and integration of sector data.

12 Section 2 | AGENCY OVERVIEW

Corporate Group The Corporate Group provides strategic management of TEQSA’s resources, including: finance, human resources, information and communications technology, records management, security, and accommodation.

Engagement Group The Engagement Group is responsible for maintaining and enhancing relationships with the sector and other higher education stakeholders. TEQSA stakeholders include peak bodies, regulatory beneficiaries (students, employers and the Australian public), other regulators, professional accreditation bodies, international agencies (including quality assurance agencies of other countries), and the media. The Engagement Group delivers TEQSA’s Annual Conference and manages all internal and external communications, the TEQSA Experts database, and expert engagement activity.

Executive Office The Executive Office has primary responsibility for coordinating overall agency activities, such as liaising with government and public service stakeholders, including: the Minister’s Office; the Department of Education, Skills and Employment; and the Higher Education Standards Panel (HESP).

The Executive Office is responsible for: managing the development of, and reporting against, the Corporate Plan; preparing the Annual Report; preparing for Senate Estimates appearances; coordinating enterprise risk management; and providing executive and administrative support to the Commissioners, CEO, accountable authority, Audit and Risk Committee, the Senior Management Team and other internal committees.

Performance review

3Introductory statement Response to COVID-19 pandemicAustralian National Audit Office performance auditPerformance against objectivesAnalysis of TEQSA’s financial performance

14 Section 3 | PERFORMANCE REVIEW

Section 3: Performance review

Introductory statement We, the TEQSA Commissioners, as the accountable authority of the Tertiary Education Quality and Standards Agency (TEQSA), present the 2019-20 annual performance statements of TEQSA, as required under paragraph 39(1)(a) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act). In our opinion, these annual performance statements are based on properly maintained records, accurately present the performance of TEQSA, and comply with subsection 39(2) of the PGPA Act.

Response to COVID-19 pandemic At the onset of the COVID-19 pandemic in March 2020, TEQSA quickly mobilised support for the Australian higher education sector. The agency deployed a number of initiatives, including:

> streamlining assessment processes for Graduate Certificate and Undergraduate Certificate programs to support providers to offer these online short courses to students

> refunding and waiving eligible fees paid by providers as part of the Australian Government’s Higher Education Relief Package

> liaising with local and international peak bodies to stay informed of the evolving situation, domestically and internationally

> continuing to update TEQSA’s website with information and resources to support the sector.

A dedicated online learning good practice website was the first key resource developed to support providers in making the rapid transition to online delivery as a result of the pandemic restrictions. The resources made available covered a range of topics related to online learning, from getting started and enabling staff to work online, to supporting student experiences and assessment integrity. From its launch in April 2020 to June 2020, the website was visited more than 17,300 times. More information about the website is available at www.teqsa.gov.au/online-learning-good-practice.

The COVID-19 pandemic had a significant effect on TEQSA’s work practices, with staff moving to working from home arrangements in March 2020. Measures such as lessening the administrative burden of regulation on providers through granting extensions of registration and accreditation periods and focusing on individual provider support, directly and through liaison with peak bodies, were also implemented. For more information about adjustments TEQSA has made to support staff see Section 4: Human resources.

Due to the impact of the COVID-19 pandemic, the 2020 survey of stakeholders was not conducted and instead a series of focus groups with provider peak bodies were held to gauge stakeholder views of TEQSA’s performance during 2019-20. As a consequence, some aspects of TEQSA’s performance were not able to be measured.

TEQSA | Annual Report 2019-20 15

Australian National Audit Office performance audit In 2019-20, the Australian National Audit Office (ANAO) undertook a performance audit of TEQSA’s regulation of higher education.

The objective of the performance audit was to assess the effectiveness of TEQSA’s regulation of higher education, and it included four criteria:

1. Does TEQSA have an effective process to assign and maintain appropriate risk ratings to existing and prospective higher education providers?

2. Does TEQSA have effective and timely approvals processes, including for registering higher education providers and accrediting courses?

3. Does TEQSA have effective assurance, compliance and enforcement processes?

4. Does TEQSA provide effective support to the higher education sector to address key sector-wide risks?

The performance audit report was tabled in parliament on 16 April 2020. The report found that TEQSA’s regulatory activities were effective or largely effective in all but one area (compliance and enforcement activities). The audit findings confirmed that TEQSA is meeting its purpose under the TEQSA Act to regulate higher education in alignment with the principles of regulatory necessity, risk and proportionality.

TEQSA accepted the five ANAO recommendations in relation to compliance and enforcement activities, and acknowledged other areas for improvement. Considerable work has been undertaken to address these areas, some of which was already planned or underway during the audit process.

This work includes strengthening the existing compliance monitoring framework, improvements to the planning of compliance assessments, and the timely assessment of material submitted by providers. Consistent processes to handle material change notifications and reporting of compliance activity have also been implemented. Details of these activities are presented in the relevant sections of this annual report.

16 Section 3 | PERFORMANCE REVIEW

TEQSA’s objectives 2019-23 The TEQSA Corporate Plan 2019-23 sets out TEQSA’s proposed actions over a four-year period under four objectives:

1. Quality assure and regulate the sector in a timely, transparent and risk-reflective manner.

2. Support providers to deliver high quality higher education, protect student interests and enhance the reputation and competitiveness of Australia’s higher education sector.

3. Provide advice and information to inform decisions about the appropriateness and quality of higher education.

4. Take prompt and effective action to address substantial risks to students or the sector’s reputation.

OUTCOME 1

Contribute to a high quality higher education sector through streamlined and nationally consistent higher education regulatory arrangements; registration of higher education providers; accreditation of higher education courses; and investigation, quality assurance, and dissemination of higher education standards and performance.

PROGRAM 1.1: REGULATION AND QUALITY ASSURANCE - OBJECTIVE

Regulation and quality assurance ensure that quality standards are being met by all higher education providers so that the interests of students and the reputation of Australia’s higher education sector are promoted and protected. This occurs by reference to the Higher Education Threshold Standards, which are determined by the Minister for Education on advice

from an independent Higher Education Standards Panel. A risk-based approach to planning and implementing assessments of provider compliance with those Standards is used.

1. TEQSA will quality assure and regulate the sector in a timely,

transparent and risk reflective manner.

3. TEQSA will provide advice and information to inform decisions

about the appropriateness and quality of higher education.

4. TEQSA will take prompt and effective action to address substantial

risks to students or the reputation of the sector.

2. TEQSA will support providers to deliver high quality higher education,

protect student interests and enhance the reputation and competitiveness of

Australia’s higher education sector.

TEQSA | Annual Report 2019-20 17

Performance against objectives

Objective 1: Quality assure and regulate the sector in a timely, transparent and risk-reflective manner During 2019-20, significant work was undertaken as part of TEQSA’s program of continual improvement of the delivery of its functions. This work included:

> reviewing the operation of the case management approach, which identified opportunities to improve response times and the clarity and consistency of information to providers

> streamlining assessment processes and improving engagement with applicants

> finalising legacy assessments from previous years

> developing expedited regulatory processes in response to the COVID-19 pandemic

> analysing the financial impact of the pandemic on providers

> working with professional accreditation bodies and the Australian Skills Quality Authority on opportunities to streamline processes and address the impact of the pandemic on providers

> working with international quality assurance agencies and networks to address cross-border risks

> improving the analysis of material change notifications and concerns about providers.

One action to address Objective 1 was not achieved, in part due to the need to focus on supporting the sector as the impact of the pandemic escalated during the latter half of 2019-20 and also due to a large number of legacy assessments from previous years. However, TEQSA successfully continued to undertake its quality assurance and regulatory functions, including a high level of engagement with providers, despite shifting to working from home arrangements during the pandemic. In addition, the impact of increased resources, implementation of improved assessment processes and a focus on completing legacy assessments resulted in improvements in both the number of assessments completed and the timeliness of decisions. The decision not to proceed with the annual stakeholder survey during the pandemic meant that for some targets there was a lack of robust evidence to assess the agency’s performance. Despite the disruption caused by the COVID-19 pandemic, two of the actions for Objective 1 were achieved, one was partially achieved, and another was not achieved. The overall performance against Objective 1 was assessed as partially achieved.

18 Section 3 | PERFORMANCE REVIEW

Action 1.1 Improve the case management approach.

Source:

2019-23 Corporate Plan, p. 15

Regulator Performance Framework KPI 5

Performance indicator:

TEQSA’s dealings with higher education providers are open, transparent and consistent.

Qualitative target: Outcome:

Review, develop and implement a revised case management approach to regulation with enhanced use of a partnership model. (Timeframe: 2019-20)

The review of the case management approach has been completed. Work to develop and implement a revised approach is continuing.

Quantitative target: Outcome:

55 per cent or more of providers rate the case management approach as good or excellent.

Stakeholder survey data not available due to COVID-19 pandemic.

Overall result: Partially achieved. Targets not fully met due to impact of COVID-19 pandemic.

Case management approach review In 2019-20, TEQSA completed a review of its case management model to identify opportunities to enhance its partnership approach. The review of the current model reflected on feedback received in past annual stakeholder surveys and meetings with independent providers, and included significant internal and external consultation, and consideration of the operating models of other regulators to draw on best practice examples. TEQSA was also very grateful for Professor Valerie Braithwaite’s contribution regarding the key elements of effective partnership models. While TEQSA recognises that many providers value a single point of contact within the agency, there is scope for using other approaches to improve the timeliness, clarity and consistency of TEQSA’s communication.

The review identified the following opportunities for improvement, which will be key focus areas in 2020-21:

> improving information management capabilities to gain a stronger understanding of the common questions and enquiries from providers so that TEQSA can develop resources to support the sector in understanding or addressing common challenges

> strengthening and coordinating internal quality assurance processes to drive improvements in timeliness, clarity and consistency

> continuing to partner with peak bodies and providers to improve TEQSA’s assessment processes and ensure guidance meets the needs of the sector

> arranging provider engagement training for all assessment staff.

TEQSA | Annual Report 2019-20 19

Working with the sector during the COVID-19 pandemic TEQSA pivoted quickly to support the sector in response to the impact of the COVID-19 pandemic. From March 2020, TEQSA was in contact with providers to understand the challenges they were facing. This included registered higher education providers, non-higher education providers (ELICOS providers), and prospective providers which had submitted applications or were in the process of applying for TEQSA registration.

Extensions to registration and accreditation were offered to providers with applications due between March 2020 and 30 June 2022. The extensions were for a maximum of three years (a limited number of CRICOS registrations were extended beyond three years in order to align with their TEQSA registration). In determining whether or not an extension was appropriate and the extension timeframe, TEQSA also considered the provider’s risk rating and regulatory history. For providers that had previously been extended (and thus could not be extended again under the current legislation), TEQSA offered to shorten the 180-day period to lodge applications. TEQSA extended the registration period of 35 providers and the accreditation period of 119 courses to reduce the administrative burden of regulation on providers in response to the pandemic. Decisions regarding additional providers eligible for extensions will continue to be finalised in 2020-21.

In addition to reducing the administrative burden of regulation, TEQSA also applied a flexible regulatory approach to support the sector in shifting operations and keeping students engaged in their study. This included a flexible approach to ensuring the location and mode of course delivery did not impede the attainment of an Australian higher education qualification. TEQSA worked in partnership with Australian Skills Quality Authority and the Department of Education, Skills and Employment to ensure timely, consistent and clear advice was provided to students and the sector. TEQSA published a range of guidance materials, including key considerations for online delivery, targeted material change information and a set of frequently asked questions.

In response to the pandemic, the government announced the Higher Education Relief Package which encouraged providers to develop six-month online short courses focused on identified national priorities. The government amended the Australian Qualifications Framework (AQF) to introduce a new qualification called an ‘Undergraduate Certificate’. TEQSA developed a streamlined approach for the assessment of new online Undergraduate Certificate and Graduate Certificate courses. This ensured expedited assessment to help providers make these courses available during the pandemic. The assessment of 80 applications for accreditation of short courses was completed with a median processing time of two days.

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Action 1.2 Implement mechanisms to ensure efficient assessment of applications

Source:

2019-23 Corporate Plan, p. 15

Regulator Performance Framework KPI 1

2019-20 Portfolio Budget Statements, p. 165

Performance indicator:

Quality assurance and regulation does not unnecessarily impede the efficient operation of higher education providers.

Qualitative target: Outcome:

Reduce the time taken to make decisions about applications, particularly where the risk of non-compliance is low. (Timeframe: 2019-23)

For applications that were found to be compliant, there were improvements of 30 per cent for accreditations and 50 per cent for re-registrations in the median time taken to make decisions compared with 2018-19.

Quantitative target: Outcome:

90 per cent or more of decisions about applications for re-registration from low-risk providers are made within six months.

50 per cent of decisions about applications for re-registration from low-risk providers were made within six months.

90 per cent or more of decisions about applications for accreditation from low-risk providers are made within three months.

29 per cent of decisions about applications for accreditation from low-risk providers were made within three months. The overall median time for decisions was 114 days (3.8 months).

80 per cent of assessment reports and expert reports where adverse findings are reported are sent to applicants for consideration and response within four months of the application date.

25 per cent of adverse finding reports for registrations, re-registrations, accreditations and re-accreditations were sent to applicants within four months. The overall median time for providing these reports was 168 days (5.6 months) for 104 assessments.

Overall result: Not achieved.

Performance against targets TEQSA did not meet its target of completing renewal of registration (re-registration) applications from low-risk providers within six months, with only half completed within six months. In 2019-20, the proportion of adverse outcomes for re-registration applications for low-risk providers was higher than in previous years (see Table 8). The re-registration of one provider took considerably longer as TEQSA considered a range of risks following the provider being named (among others) in an Australian Broadcasting Corporation Four Corners media report on English language proficiency entry standards and admissions practices.

TEQSA | Annual Report 2019-20 21

In the case of applications for accreditation from low-risk providers, the overall median time for all relevant decisions was 3.8 months compared with the target of three months. For applications where there was a preliminary assessment of non-compliance, the median timeframe for providing assessment reports to applicants was 5.6 months compared with the target of four months.

Improvements to assessment processes TEQSA is committed to streamlining and improving the timeliness of its assessment activities and ensuring case managers engage early and transparently with providers. Key business improvement strategies implemented in 2019-20 included:

> conducting comprehensive reviews of business processes to identify opportunities to streamline processes, including increased specialisation

> extending registration and accreditation periods for some providers to maintain manageable workloads, supporting TEQSA’s efforts to improve timeliness and target high-risk matters

> enhancing TEQSA’s focus on providers’ own self-assurance processes as TEQSA moves into the second seven-year cycle of assessment activities

> implementing an early engagement approach to highlight concerns or deficiencies following an initial assessment of a provider’s application and ensuring that providers have sufficient time to respond.

Due to the COVID-19 pandemic, some business improvement projects were put on hold to manage a range of new priorities and to enable the shift of all TEQSA staff to remote working arrangements.

Regulatory caseload in 2019-20 The profile of assessments in the 2019-20 caseload was comparable with that of 2018-19, with the exception of short courses and applications for renewal of accreditation (re-accreditation). In 2020, online short courses leading to Undergraduate Certificates and Graduate Certificates were announced by the government in response to the pandemic. TEQSA made decisions about 80 applications of these short courses for 23 providers (which do not have the authority to accredit their own courses). The 2019-20 caseload also included an increase in applications for the re-accreditation of courses that were processed in a very short space of time.

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Table 1 sets out TEQSA’s caseload over the last three years. In 2019-20, TEQSA received 42 per cent more applications in total than the previous year and completed 43 per cent more assessments compared with 2018-19, primarily due to the number of applications for short courses and re-accreditations.

Table 1: TEQSA’s caseload summary

2017-18 2018-19 2019-20

Active assessments as at the end of the financial year 211 141 146

Applications received (including 2019-20 short courses) 193 260 369 (83)

Completed assessments (including 2019-20 short courses) 269 255 364 (80)

Table 2 sets out the total number of assessments completed and decisions made over the last three years. In 2019-20, there was a 45 per cent increase in the number of decisions made including short courses (or a 38 per cent increase if short courses are excluded).

Table 2: Completed assessments and decisions

2017-18 2018-19 2019-20

Decisions (including 2019-20 short courses) 192 186 337 (80)

Withdrawn 77 69 27

TOTAL (completed assessments) 269 255 364

Decision timeframes In 2019-20, there was an improvement in the overall median processing time as shown in Table 3. This improvement was primarily due to an increase in the proportion of applications decided that require less time to assess, such as applications for re-accreditation. Re-accreditation processing times decreased by 47 per cent from 413 days to 220 days, while the median time for accreditations remained constant. In the case of applications for course accreditation from low-risk providers, 64 per cent were completed in fewer than four months.

TEQSA | Annual Report 2019-20 23

Table 3: Number of assessments decided and number of days to decision

2017-18 2018-19 2019-20

Number of assessments decided (excluding short courses) 192 186 257

Average number of days to decision 290 273 197

Median number of days to decision 299 226 140

TEQSA commenced 2019-20 with a number of re-registration assessments carried over from previous financial years, including seven applications that had been under assessment for 12 months or more. During 2019-20, there was a concerted effort to finalise these legacy re -registration assessments, which resulted in a significant reduction in the median age of the re-registration caseload from 14 months on 30 June 2019 to 4.8 months as at 30 June 2020. Only two applications that had been under assessment for 12 months or more remained active at the end of 2019-20.

43 per cent of applications lodged in 2019-20 were decided during the year, with a processing time of five months or less. As shown in Table 4, when the legacy re-registration applications are excluded from analysis, the median processing time was 191 days, considerably less than the overall median of 387 days.

Table 4: Median number of days for processing of the most common types of applications from submission (or commencement of substantive assessment) to decision

2017-18 2018-19 2019-20

Registration 419 231 242

Re-registration 399 397 387

Re-registration (excluding legacy assessments decided in 2019-20) - - 191

Course accreditation (registered and prospective providers) 303 154 150

Course accreditation (registered providers) 299 147 150

Course re-accreditation 247 413 220

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Table 5 sets out the median time to decision about applications for re-registration and accreditation from registered providers with and without adverse findings over the last two years. Where there was no evidence of non-compliance during the assessment process (i.e. there were no proposed adverse findings), median timeframes reduced significantly compared with 2018-19, by about 30 per cent for accreditations (from 152 to 104 days) and about 50 per cent for re-registrations (from 360 to 168 days).

Table 5: Median number of days to decision for assessments with and without adverse findings

Assessment type

2018-19 2019-20

Without adverse findings (days)

With adverse findings (days)

Overall median (days)

Without adverse findings (days)

With adverse findings (days)

Overall median (days)

Re-registration 360 478 397 168 779 387

Accreditation (registered providers)

141 152 147 104 150 150

Performance in 2019-20 against the requirements of the TEQSA Act Under its governing legislation, TEQSA is obliged to provide particular forms of advice and complete certain processes within specified timeframes. Table 6 contains information about TEQSA’s performance in meeting legislative deadlines required by the TEQSA Act. In 2019-20, the agency met all of its legislative deadlines except in the case of one decision about an application for course accreditation.

TEQSA | Annual Report 2019-20 25

Table 6: Performance in 2019-20 against the requirements of the TEQSA Act

Requirement Performance

Section 19

TEQSA must undertake a preliminary assessment of an application for registration within 30 days after an application is made.

Achieved

100 per cent of preliminary assessments were completed within 30 days. There were nine assessments in 2019-20.

Section 21

TEQSA must make a decision on an application for registration within nine months of receiving it or, if TEQSA is satisfied for reasons beyond its control that a decision cannot be made within the nine months, TEQSA may determine a longer period not exceeding a further nine months, within which it must make a decision on the application.

Achieved

100 per cent of decisions about applications for registration were made within nine months. There were eight decisions in 2019-20.

Section 47

TEQSA must make a preliminary assessment of an application for a course of study to be accredited within 30 days after an application is made.

Achieved

100 per cent of preliminary assessments were completed within 30 days. There were 82 assessments in 2019-20.

Section 49

TEQSA must make a decision on an application for accreditation of a course of study within nine months of receiving it or, if TEQSA is satisfied for reasons beyond its control that a decision cannot be made within the nine months, TEQSA may determine a longer period, not exceeding a further nine months, within which it must make a decision on the application.

Mostly achieved

99 per cent of decisions about applications for accreditation were made within nine months. There were 83 decisions in 2019-20. One decision was not made within nine months.

Section 186

TEQSA must make a decision on a review of a reviewable decision within 90 days after receiving the application for review.

Achieved

100 per cent of decisions on a review of a reviewable decision were made within 90 days. There were three decisions in 2019-20.

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Adverse decisions Adverse decisions include decisions to: grant a period of registration or accreditation that is less than the maximum seven years; impose conditions; cancel accreditation or registration; and reject an application.

TEQSA informs applicants of proposed adverse decisions, including the reasons for those proposed decisions, and no decision is made until the applicant has had an opportunity to respond to the basis for the proposed decision.

In 2019-20, the proportion of re-registration assessments with an adverse decision increased slightly from the previous year.

Table 7: Percentage of assessments of re-registration applications with an adverse decision

Year Adverse (per cent)

2017-18 56

2018-19 38

2019-20 44

TEQSA | Annual Report 2019-20 27

Action 1.3 Ensure regulation of the sector is reflective of the risks to students and the sector

Source:

2019-23 Corporate Plan, p. 16

Regulator Performance Framework KPI 4

2019-20 Portfolio Budget Statements, p. 166

Performance indicator:

TEQSA’s compliance and monitoring approaches are streamlined and coordinated.

Qualitative target: Outcome:

Engage with providers about areas for improvement in TEQSA’s approach using feedback from the stakeholder survey. (Timeframe: Annual)

TEQSA undertook a review of the risk assessment framework following feedback from the sector.

Streamline evidence requirements further for providers that demonstrate sustained low risk of non-compliance with standards. (Timeframe: 2019-20)

Registration and accreditation periods were extended to reduce administrative burden in response to the impact of the COVID-19 pandemic. Work to consider TEQSA’s monitoring approach is ongoing.

Work with ASQA, other agencies and professional bodies to improve targeting of regulation and to implement government policy regarding professional accreditation. (Timeframe: 2019-23)

TEQSA undertook projects with professional accreditation bodies to examine streamlining opportunities.

Undertake cross border regulatory activity through engagement with international quality agencies. (Timeframe: 2019-23)

TEQSA finalised the development of a toolkit for quality agencies on behalf of the International Network for Quality Assurance Agencies in Higher Education to address academic integrity and contract cheating incidents. TEQSA also engaged with international agencies regarding the move to online delivery as a result of the pandemic.

Quantitative target: Outcome:

There is a demonstrated correlation between the risk rating of providers and assessment outcomes for each year.

There was alignment between the risk profile of a provider and the outcome of regulatory decisions on re-registrations.

Overall result: Achieved.

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TEQSA’s approach to provider risk

Risk Assessment Framework

TEQSA’s Risk Assessment Framework is a key aspect of how TEQSA assesses risk. The Risk Assessment Framework provides a snapshot of higher education providers to help prioritise TEQSA’s focus in undertaking its assurance activities. In July 2019, the agency commenced consultations with the sector on the Risk Assessment Framework and published the Risk Assessment Framework Consultation: Summary Report in January 2020.

The agency’s risk-reflective approach to assessment means that it varies evidence requirements based on all available information about each registered provider’s organisational characteristics and risk profile, and seeks to ensure that the agency’s and provider’s resources are targeted to areas of concern.

Cycle 7 of the annual risk assessment was completed during 2019-20 using data validated by the Department of Education, Skills and Employment from the Higher Education Information Management System. As in past years, all providers were sent a risk assessment report and provided an opportunity to respond to the initial findings before each provider risk assessment was finalised.

Alignment of risk profiles and decision outcomes

In 2019-20, TEQSA re-registered 18 providers with ratings across the risk categories. Table 8 illustrates the percentage of adverse re-registration decisions for these risk categories for the last three years.

Table 8: Risk ratings and outcomes for re-registration*

Provider risk rating

Adverse outcome** (per cent)

Positive outcome (per cent)

2017-18 Moderate to high 75 25

Low 0 100

2018-19 Moderate to high 71 29

Low 11 89

2019-20 Moderate to high 50 50

Low 25 75

*Risk ratings are applicable at the date of receipt of application **Condition, rejection of application or < 7 years of registration

TEQSA’s risk assessments do not draw conclusions about compliance with the HES Framework or the ESOS Act and National Code. The Risk Assessment Framework focuses on key risks across the sector that can be readily measured on a regular

TEQSA | Annual Report 2019-20 29

basis. However, in determining the scope of a regulatory assessment, TEQSA will consider a range of factors in addition to the Risk Assessment Framework, including a provider’s compliance history, concerns received by TEQSA and open source information.

Table 9 demonstrates the relationship between the risk profile of a provider and the outcome of regulatory decisions about course accreditation and re-accreditation applications for registered providers. TEQSA only accredits or re-accredits courses for providers without self-accrediting authority. The table highlights the high proportion of course accreditation and re-accreditation decisions in 2019-20 with no adverse outcome (i.e. accreditation period of seven years and no conditions). This shift in part reflects a broader approach adopted by TEQSA where engagement with providers is undertaken at an earlier stage of the assessment process to help resolve compliance concerns in a more collaborative manner prior to a decision. This has resulted in fewer conditions being imposed and an increased use of non-statutory information requests.

Table 9: Risk ratings and outcomes for course accreditation and re-accreditation*

Provider risk rating

Adverse outcome** (per cent)

Positive outcome (per cent)

2017-18 Moderate to high 50 50

Low 58 42

2018-19 Moderate to high 64 36

Low 25 75

2019-20 Moderate to high 29 71

Low 13 87

*Risk ratings are applicable at the date of receipt of application **Condition, rejection of application or < 7 years of accreditation

Professional accreditation TEQSA continued to work with industry professional bodies during 2019-20 to consider and develop streamlined approaches to accreditation with the aim of minimising the administrative cost burdens on providers resulting from traditional accreditation. Projects included: standards mapping with Engineers Australia; a workshop to discuss streamlining and duplication between the standards of the HES Framework and those of the Australian Dental Council; and standards mapping with the Queensland College of Teachers against the Australian Institute for Teaching and School Leadership (AITSL) standards.

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To further promote streamlined approaches to accreditation between the requirements of the HES Framework and those of industry professional bodies, TEQSA continued its work in the area of joint accreditation and undertook joint course accreditations with the Financial Adviser Standards and Ethics Authority and providers with the Queensland College of Teachers. This work involved using industry professional representatives with higher education expertise as TEQSA Experts in the course accreditation process.

TEQSA continued to be active in its advisory work with professional body peak groups, including providing ongoing advice to AITSL and through being a member of the Australian Health Practitioner Regulation Agency Accreditation Advisory Committee.

In response to the COVID-19 pandemic, TEQSA has been communicating with industry professional bodies with which it has a memorandum of understanding (MoU) regarding the need to be flexible in the approach to accreditation and professional registration during the pandemic. TEQSA issued a number of communications to the sector as responses to the pandemic developed. One initiative, which TEQSA strongly supported, was the development of the Joint Statement of Principles for the Higher Education Sector COVID-19 Response (May 2020) signed by:

> Australian Council of Professions

> Universities Australia (UA)

> Independent Tertiary Education Council Australia (ITECA)

> Independent Higher Education Australia (IHEA)

> Australian Collaborative Education Network.

TEQSA has 39 MoUs in place with professional and industry bodies. These set out the basis for sharing of information about regulatory and other matters. During 2019-20, TEQSA signed or renewed agreements with the organisations listed in Table 10.

TEQSA | Annual Report 2019-20 31

Table 10: Memorandum of understanding agreements with professional bodies signed or renewed in 2019-20

Organisation Date signed or

renewed

Architects Accreditation Council of Australia (AACA) 22 August 2019

Audiology Australia (AudA) 22 August 2019

Australian Institute for Teaching and School Leadership (AITSL) 21 August 2019

Australian Medical Council Limited (AMC) 24 September 2019

Australian Skills Quality Authority (ASQA) 12 March 2020

Council of Australasian University Leaders in Learning and Teaching (CAULLT) 2 September 2019

Independent Higher Education Australia (IHEA) 30 March 2020

Independent Tertiary Education Council Australia (ITECA) 24 February 2020

National ELT Accreditation Scheme Limited (NEAS) 29 August 2019

Teachers Registration Board of South Australia 11 September 2019

Working with international quality agencies TEQSA is an active member of a number of global higher education quality assurance networks, including:

> International Network for Quality Assurance Agencies in Higher Education (INQAAHE)

> Council for Higher Education Association International Quality Group (CIQG)

> Asia Pacific Quality Network (APQN)

> Quality Beyond Boundaries Group (QBBG).

Through its membership and contribution to these groups, TEQSA plays an important role in protecting, enhancing and promoting the quality and integrity of Australia’s higher education sector internationally.

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During 2019-20, TEQSA continued engagement with international quality assurance agencies and networks through various activities, including:

> participation in the QBBG annual meeting in Singapore in October 2019 as well as the May 2020 extraordinary meeting to discuss each agency’s response to the COVID-19 pandemic, which included discussion on approaches to quality assurance of online learning and the future of digital learning

> writing to international Memorandum of Cooperation (MoC) partners in April 2020, seeking to protect the standing of Australian higher education qualifications and explain the move to online delivery of courses and quality assurance in response to the disruption caused by the COVID-19 pandemic

> regular teleconferences with its international MoC partners

> TEQSA’s International Quality Assurance Staff Exchange Program.

During 2019-20, TEQSA signed or renewed MoCs with the organisations listed in Table 11.

Table 11: Memorandum of Cooperation signed or renewed in 2019-20

Organisation Date signed or

renewed

Academic Quality Agency for New Zealand Universities (AQA) 11 October 2019

Commission for Academic Accreditation (CAA) 29 November 2019

Hong Kong Council for Accreditation of Academic and Vocational Qualifications 28 November 2019

Quality and Qualifications Ireland 29 November 2019

Quality Assurance Agency for Higher Education, UK (QAA) 4 November 2019

SkillsFuture Singapore 31 July 2019

INQAAHE toolkit to support international quality assurance agencies to address academic integrity and contract cheating

In 2019-20, TEQSA produced a toolkit to support international quality assurance agencies with addressing academic integrity and contract cheating in their various jurisdictions. The development of the toolkit was funded through a grant awarded to TEQSA by INQAAHE in 2018-19. The toolkit was informed by current and emerging research into both academic integrity and contract cheating, and includes consideration of a broad suite of frameworks, approaches, and systems for the quality assurance of higher education. Case studies within the toolkit showcase responses to a sector-wide or provider-specific academic integrity issue.

The Toolkit to support quality assurance agencies to address academic integrity and contract cheating is available at: www.teqsa.gov.au/latest-news/publications/toolkit-support-quality-assurance-agencies-address-academic-integrity.

TEQSA | Annual Report 2019-20 33

Action 1.4 Enhance TEQSA’s approach to monitoring, assessment and management of risks

Source:

2019-23 Corporate Plan, p. 16

Performance indicator:

Improved identification of high risk providers; reduced administrative cost burden for low risk providers; and improved evidence base for decisions about any required regulatory action.

Qualitative target: Outcome:

Engage with individual providers with high risk ratings to determine the progress and the effectiveness of providers’ risk treatment plans. (Timeframe: Annual)

Cycle 7 risk assessments to identify relevant providers were completed but the development of action plans was modified due to COVID-19 risk priorities. The risk environment continues to be closely monitored with a focus on providers’ financial risk.

Adopt an approach to scoping assessments which aligns with TEQSA’s risk appetite. (Timeframe: 2019-20)

An improved approach to scoping was developed, tested and implemented. An enhanced regulatory decision making framework was developed as part of TEQSA’s broader risk management framework.

Incorporate broader and timelier sources of information about risks in monitoring of the sector. (Timeframe: 2019-23)

A comprehensive project to improve the categorisation and triage of concerns about providers was completed. The risk-monitoring project was aligned with compliance and regulatory assessment work and will continue to be developed in 2020-21.

Overall result: Achieved.

Provider risk in 2019-20

High-risk provider treatment plans

TEQSA considers the performance of providers annually through its provider risk assessment process. The risk assessment cycle is an important mechanism to identify high-risk providers that may warrant further engagement from TEQSA. This year, due to the COVID-19 pandemic, the risk context shifted significantly.

The financial impact of the pandemic on Australia’s higher education sector has been considerable. In early 2020, when travel restrictions resulted in students from China being unable to return to Australia, TEQSA engaged with all universities (and other higher education providers with significant numbers of Chinese students) to better understand the financial implications of the travel restrictions and providers’ risk mitigation strategies. This included face-to-face meetings with the providers considered to be impacted most significantly. This early engagement

34 Section 3 | PERFORMANCE REVIEW

strategy ensured TEQSA had an accurate and up-to-date understanding of the financial risks as well as adequate oversight of providers’ strategies to mitigate those risks. As the pandemic escalated, TEQSA obtained regular financial updates from a number of particularly affected providers and continued to monitor the sector closely.

Risk appetite

In 2019-20, TEQSA developed risk appetite statements for regulatory and enterprise risks. Work is underway to integrate these statements within TEQSA’s risk management framework. In addition, the implementation of an improved approach to scoping of assessments draws on all available data and intelligence and is proportionate to the potential risks identified.

Risk monitoring and compliance

Concerns about providers

Assessing concerns received about higher education providers is a key aspect of TEQSA’s risk monitoring approach.

In 2019-20, TEQSA improved its approach to managing concerns about regulated entities. This included: improving public information; implementing a robust risk based triage process to more effectively prioritise concerns; and improving the categorisation of concerns to enhance TEQSA’s reporting, oversight and market intelligence about providers. The improved approach has enhanced the timeliness and usefulness of the information used by TEQSA to monitor risk.

Table 12 sets out the number of concerns received by TEQSA over the last two years that are within TEQSA’s legislative remit. In 2019-20, TEQSA received 497 concerns about providers, with 77 outside of TEQSA’s jurisdiction which were redirected to the relevant agencies, where possible. In 2019-20, there was a 12 per cent increase in concerns received that were within TEQSA’s remit compared with the previous year. Of these 420 concerns, the majority (33 per cent) were received between April and June 2020; and 54 related to the impact of the COVID-19 pandemic.

Table 12: Concerns received within TEQSA’s jurisdiction year on year comparison

2018-19 2019-20

Number of concerns received 376 420

TEQSA | Annual Report 2019-20 35

Table 13 sets out the top ten types of concerns received by TEQSA over the last two years. In 2019-20, there was a substantial increase in concerns received about the delivery of teaching and courses, and the adequacy of student support and the learning environment, compared with the previous year. Many of these concerns related to changes to delivery as a result of the pandemic, particularly the move to online delivery. In the majority of cases, complainants were referred to their provider’s internal complaints mechanisms for consideration of their complaint.

Table 13: Concerns received by category

Type of concern 2018-19 2019-20

Delivery (Teaching and Courses) 38 84

Governance 72 63

Student Services / Learning Environment 27 47

Tuition and Refunds 39 36

Wellbeing and Safety - Other 22 25

Unregistered entity 13 22

Misrepresentation 15 18

Admission 31 16

Third party mismanagement 11 12

Other* 108 97

Total 376 420

*This category includes a range of concerns, including: contract cheating; information security; attainment/certification; ESOS Act; research integrity and quality; wellbeing and safety - sexual assault and sexual harassment; academic misconduct; provider closure; ELICOS; and disputes about matters that do not relate to another concern category.

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Material changes

All registered higher education providers are required to notify TEQSA of events that will significantly affect their ability to meet the requirements of the HES Framework. TEQSA considers each of these notifications carefully to identify potential areas of substantial risk that may warrant further consideration.

In 2019-20, TEQSA received an unprecedented number of material change notifications, primarily as a result of changes providers had to make to respond to the COVID-19 pandemic, including shifting to online delivery. Table 14 sets out the top 10 categories of material change notifications received over the last two years. TEQSA received 441 material change notifications in 2019-20, which represents a 68 per cent increase on the previous year. The vast majority of notifications required no further action from TEQSA as providers demonstrated that they had considered the risks and had adequate mitigation measures in place. There were 14 material change notifications which resulted in formal compliance assessments.

Table 14: Material Change Notifications by category

Material change notification by category 2018-19 2019-20

Major course changes - Delivery mode 5 152

Change to Executive and/or Board membership

111 112

Governance - Ownership/Shareholdings/ Control 12 23

Change to Principle Executive Officer 17 22

Third party agreement 32 22

Major course changes - Other 18 20

Update to National Register - Provider Details (Name/Status) 9 11

Governance - Other 5 10

Major campus changes - Campus closure/s 1 10

Other 52 59

Total 262 441

TEQSA | Annual Report 2019-20 37

Objective 2: Support providers to deliver quality higher education, protect student interests and enhance the reputation and competitiveness of Australia’s higher education sector

During 2019-20, TEQSA:

> undertook a review of the risk assessment framework to ensure its relevance in assessing the risks to student interests, and the reputation and competitiveness of the sector

> developed a revised approach to risk assessment to enable monitoring of the financial impact of the pandemic on providers

> published guidance and other materials to support providers to comply with HES Framework requirements, particularly in the rapid transition to online learning due to the restrictions of the pandemic.

TEQSA’s engagement with the sector was extensive during 2019-20, starting with the review of the risk assessment framework and later in response to the move to online learning. Access to materials and participation in events before and after the outbreak of the COVID-19 pandemic remained high, indicating the appropriateness of the engagement with providers and the support made available to the sector. The decision not to proceed with the annual stakeholder survey during the pandemic meant that for some targets there was a lack of robust evidence to assess the agency’s performance. Despite the disruption caused by the pandemic, the overall performance against Objective 2 was assessed as achieved.

Action 2.1: Consult stakeholders and identify issues and delivery strategies where guidance is required

Source:

2019-23 Corporate Plan, p. 17 Regulator Performance Framework KPI 6

Performance indicator:

The quality assurance and regulatory framework continues to be improved in consultation with relevant stakeholders.

Qualitative target: Outcome:

Consult relevant stakeholders in reviewing and implementing changes arising from changes to legislation, legislative instruments or regulatory policy. (Timeframe: 2019-23)

Risk Assessment Framework consultation completed.

Consult the sector on application fees and the annual levy in light of Government policy on cost recovery. (Timeframe: 2019-20)

The government revised the commencement date to 1 July 2021 in response to the disruption caused by the pandemic.

Qualitative target: Outcome:

60 per cent or more of stakeholders rate TEQSAs consultation on improvements to the regulatory framework as good or excellent.

Stakeholder survey data not available due to COVID-19 pandemic.

Overall result: Achieved.

38 Section 3 | PERFORMANCE REVIEW

Risk Assessment Framework Consultation TEQSA released its Risk Assessment Framework Consultation Paper in July 2019 to consult with the higher education sector on TEQSA’s approach to risk assessment. TEQSA encouraged stakeholders to respond to seven questions, and to present other relevant views for TEQSA to consider in its planning. TEQSA received written submissions during the consultation period.

TEQSA also hosted a series of consultation workshops across Melbourne, Perth, Brisbane, Adelaide and Sydney between July and September 2019. Representatives from over 80 per cent of Australian higher education providers participated. At least one TEQSA Commissioner attended each workshop to hear from and engage with participants. This process provided a platform for participants to deepen their understanding of TEQSA’s current risk assessment approach, and allowed for open and frank discussions between providers and TEQSA on the ways TEQSA could further enhance its monitoring and assessment of risk.

Broadly, stakeholders were supportive of the overall structure of the Risk Assessment Framework and the key risk areas it identified. Feedback included: the issue of data lag; proposed potential new risk indicators; the risks faced by the sector; suggested revised methodologies for existing risk indicators; and the benefit of more contextual factors that impact providers’ risk profiles on indicators such as attrition, graduate destinations and student-staff ratio.

The feedback received will be incorporated into changes to the Risk Assessment Framework over the coming years. The disruption caused by the COVID-19 pandemic has required a revised approach to risk assessment in the short term. There will be continued assessment of risk to students, and risk to providers’ financial position, with a major focus this year on financial viability.

TEQSA | Annual Report 2019-20 39

Action 2.2: Publish information about regulatory and quality assurance matters

Source:

2019-23 Corporate Plan, p. 17

Regulator Performance Framework KPI 2

2019-20 Portfolio Budget Statements, p. 166

Performance indicator:

TEQSA’s communication with higher education providers is clear, targeted and effective.

Qualitative target: Outcome:

Publish information including guidance notes, good practice notes and other resources about quality based on identified needs. (Timeframe: 2019-23)

One report and six new or updated guidance notes were published.

A repository of online learning resources was established for providers in response to the COVID-19 pandemic, which had more than 12 000 unique page views. This was supplemented by webinars and podcasts on online learning.

Qualitative target: Outcome:

80 per cent or more of stakeholders surveyed each year rate TEQSA’s communication as good or excellent.

Stakeholder survey data not available due to COVID-19 pandemic.

Overall result: Achieved.

Publication of information In 2019-20, TEQSA updated five of its guidance notes and released a new guidance note: Guidance Note: Monitoring and Analysis of Student Performance. TEQSA also published two good practice notes: Making higher education admissions transparent for prospective students (July 2019) and Improving retention and completion of students in Australian higher education (February 2020).

In response to the need for providers to transition to online delivery of courses at the start of the COVID-19 pandemic and in recognition that several providers had limited experience with this mode of delivery, TEQSA assembled online learning good practice resources and made these available on the TEQSA website. These resources were reviewed regularly, in consultation with the sector, to address identified needs of providers. From its launch in April 2020 to June 2020, the website was visited more than 17,300 times and there have been more than 12,000 unique page views of these resources.

40 Section 3 | PERFORMANCE REVIEW

Objective 3: Provide advice and information to inform decisions about the appropriateness and quality of Australian higher education

During 2019-20, TEQSA provided advice and information to the sector and other stakeholders including:

> discussing key issues about quality and regulation with the TEQSA Student Expert Advisory Group

> publishing a report analysing the key risk findings of Australian higher education providers and the sixth edition of the Statistics report on TEQSA registered higher education providers 2019

> publishing information about regulatory decisions on the National Register of Higher Education Providers (National Register) within the legislative timeframe

> briefing the Higher Education Standards Panel (HESP) about important sector matters

> contributing to the review of the Australian Qualifications Framework (AQF), the review of provider categories and the implementation of recommendations regarding professional accreditation

> focusing the TEQSA Annual Conference on the theme of ‘partnerships driving quality’

> hosting workshops to promote academic integrity

> delivering webinars about the transition to online learning.

Since commencing operations in 2012, TEQSA has developed considerable expertise about the sector. It has established an effective and diverse approach to providing evidence-based advice and information about the sector to stakeholders. The increasing popularity of the TEQSA conference, workshops, webinars and forums reflects the relevance of the topics to the sector. The overall performance against Objective 3 was assessed as achieved.

TEQSA | Annual Report 2019-20 41

Action 3.1: Enhance engagement with students

Source:

2019-23 Corporate Plan, p. 18

Regulator Performance Framework KPI 6

2019-20 Portfolio Budget Statements, p. 166

Performance indicator:

The quality assurance and regulatory framework continues to be improved in consultation with stakeholders.

Qualitative target: Outcome:

Meet with the Student Expert Advisory Group regularly to identify and discuss sector wide issues for students, develop resources for students and strategies for the deeper integration of students with TEQSA’s regulatory work. (Timeframe: Annual)

There were two meetings held during 2019-20 where key issues and strategies relating to the regulation and quality assurance of higher education were discussed with student leaders.

Overall result: Achieved.

Student engagement TEQSA continues to foster collaborative relationships with its Student Expert Advisory Group. In November 2019 and May 2020, meetings were held with the group, including leaders from the major student representative bodies:

> Australian Queer Students’ Network (AQSN)

> Council of Australian Postgraduate Associations (CAPA)

> Council of International Students Australia (CISA)

> Independent Higher Education Australia (IHEA) nominee

> Independent Tertiary Education Council Australia (ITECA) nominee

> National Aboriginal and Torres Strait Islander Postgraduate Association (NATSIPA)

> National Union of Students (NUS)

> TAFE Directors Australia (TDA) nominee

> Union of Aboriginal and Torres Strait Islander Students (UATSIS).

TEQSA also held an Academic Integrity for Students workshop in November 2019. The workshop was designed to enable students to discuss the serious implications of contract cheating with senior leaders, academic staff, and fellow students and to contribute to the creation of effective solutions to the problem of contract cheating at their home institutions. Forty-five students from a diverse range of providers participated in the workshop.

In response to the impact of the pandemic on students, TEQSA collaborated with the Student Expert Advisory Group to update the TEQSA student webpage to ensure it remained relevant for students transitioning to online learning. The resources ranged from: support during the COVID-19 pandemic; useful links for support services offered to students; TEQSA’s complaints procedures; to information on the newly developed short course certificates.

42 Section 3 | PERFORMANCE REVIEW

Action 3.2: Provide information about the sector to inform policy development, good practice and student choice

Source:

2019-23 Corporate Plan, p. 18

Performance indicator:

Policy makers and other stakeholders are provided with an evidence base for decision making in relation to particular issues.

Qualitative target: Outcome:

Publish information about key data used or collected by the agency. (Timeframe: Annual)

The sixth edition of the Statistics report on TEQSA registered higher education providers was released.

Publish timely and accessible information about regulatory decisions on the National Register of Higher Education Providers and on the TEQSA website. (Timeframe: 2019-23)

The National Register and TEQSA website were updated regularly and work to further enhance the National Register commenced.

Engage with the work of the Department of Education and the Higher Education Standards Panel in relation to higher education quality and regulation. (Timeframe: 2019-23)

TEQSA contributed to the review of the AQF and revised draft standards arising from the review of provider categories, and continued to engage with the Department of Education, Skills and Employment on implementation of the recommendations of the review of professional accreditation.

Deliver an annual conference and a program of forums that highlight key quality issues for the sector. (Timeframe: Annual)

TEQSA’s annual conference was held in late November 2019. Registration and attendance at the conference exceeded previous TEQSA conferences by a significant margin, reflecting strong support for the conference by all groups of TEQSA stakeholders.

Qualitative target: Outcome:

75 per cent or more of stakeholders rate the TEQSA Conference and the National Register of Higher Education Providers as good or excellent.

Stakeholder survey data not available due to COVID-19 pandemic. However, the National Register remains the most accessed part of the TEQSA website with over 70,000 page visits in 2019-20.

Overall result: Achieved.

TEQSA | Annual Report 2019-20 43

Information about the sector

Publication of information

TEQSA published its Statistics report on TEQSA registered higher education providers 2019 in October 2019 at: www.teqsa.gov.au/latest-news/publications/statistics-report-teqsa-registered-higher-education-providers-2019.

TEQSA published its Key risk findings on Australia’s higher education sector in July 2019 at: www.teqsa.gov.au/latest-news/publications/key-risk-findings-australias-higher-education-sector.

National Register

Under section 198 of the TEQSA Act, TEQSA is required to establish and maintain a national register. The National Register of Higher Education Providers (National Register) makes available useful information about all registered providers and regulatory action taken by TEQSA, including all regulatory decisions and reasons for those decisions, at www.teqsa.gov.au/national-register.

As of 30 June 2020, 178 providers were registered with TEQSA (see Table 15) and 1 811 TEQSA-accredited courses were listed. In 2019-20, seven new providers were added to the National Register, including one provider registered as a result of a decision made by the Administrative Appeals Tribunal. The National Register received over 70,000 page views in 2019-20, making it the most accessed section of the TEQSA website.

Table 15: National Register breakdown as at 30 June 2020

Provider Category Providers with SAA (full or partial)

Providers with no SAA TOTAL

Higher Education Provider*

11 124 135

Australian University 40 0 40

Australian University College

1 0 1

Australian University of Specialisation 1 0 1

Overseas University 1 0 1

Total providers 54 124 178

* includes for-profit, not-for-profit and TAFE providers

44 Section 3 | PERFORMANCE REVIEW

Engagement with the Higher Education Standards Panel

TEQSA worked closely with relevant Commonwealth, State and Territory agencies and in particular: the Department of Education, Skills and Employment; the Higher Education Standards Panel (HESP); the Australian Skills Quality Authority (ASQA); and the Department of Home Affairs. This collaboration included the regular exchange of information related to the risks to students and the reputation of the higher education sector.

Under section 168 of the TEQSA Act, the responsibilities of the HESP include monitoring the operation of, and making recommendations for amendments to, the HES Framework. More recently, the HESP has been given the role of advising and making recommendations to TEQSA about: approaches to deregulation; strategic objectives; corporate planning and performance against the plan; streamlining of activities; and resourcing requirements. TEQSA attended meetings of the HESP to discuss sector matters, including operation of the HES Framework. During 2019-20, TEQSA Commissioners, the CEO and senior staff attended each meeting of the HESP to progress important sector matters including:

> actions to support the sector during the COVID-19 pandemic

> outcomes of the Australian National Audit Office performance audit

> actions to address risks of contract cheating

> monitoring of compliance with English language admissions standards

> review of the Risk Assessment Framework

> assessment of the adoption of admissions transparency recommendations by providers

> engagement with students to monitor the student experience.

TEQSA | Annual Report 2019-20 45

TEQSA Annual Conference and forums

In 2019-20, TEQSA undertook a variety of sector engagement forums and events including:

> the annual TEQSA Conference, held in Melbourne from 27-29 November 2019, which attracted over 930 delegates from 163 institutions and 11 international organisations

> regular meetings with peak bodies to discuss policy issues and the impact of COVID-19 on their members

> two expert briefing workshops held in July 2019 and an experts annual forum held prior to the TEQSA Conference in November 2019

> five Risk Assessment Framework Consultation Workshops held between July and September 2019

> twenty Academic Integrity Workshops held across Australia (including regional areas) and in New Zealand between October 2019 and January 2020, with the aim to assist providers to promote a culture of academic integrity within their higher education institutions

> a six-part webinar series Going online: R(e)imagining teaching and learning, produced in collaboration with RMIT, was delivered to support providers during the COVID-19 pandemic. Along with recordings of the webinars, responses to the questions raised were recorded and made available on the TEQSA website. In total, the six webinars had over a thousand participants.

Information about the TEQSA Conference 2019 is available at: www.teqsa.gov.au/ teqsa-conference-2019-0.

46 Section 3 | PERFORMANCE REVIEW

Objective 4: Taking prompt and effective action to address substantial risks to students or the reputation of the sector

In 2019-20, TEQSA undertook significant work on ensuring provider compliance with the HES Framework and addressing sector-wide risks including:

> improving the management of compliance assessments and the reporting framework

> participating in the review of regulatory decisions in the Administrative Appeals Tribunal (AAT)

> reviewing implementation of recommendations for the transparency of admissions

> assessing compliance with English language proficiency admission requirements

> publishing good practice notes on areas that pose a risk to students and to the reputation of the sector, such as admissions transparency and student retention.

The work TEQSA undertakes in addition to application-based assessments has increased as the agency’s knowledge about risks to students and the sector has grown. TEQSA’s tailored approach to different quality issues has ensured proportionate action has been taken to address risks. The decision not to proceed with the annual stakeholder survey during the pandemic meant that for one target there was a lack of robust evidence to assess that agency’s performance. Despite the disruption caused by the pandemic, performance against Objective 4 was assessed as achieved.

Action 4.1: Undertake compliance assessments and take regulatory action to address serious non-compliance

Source:

2019-23 Corporate Plan, p. 19

Regulator Performance Framework KPI 3

2019-20 Portfolio Budget Statements, p. 166

Performance indicator:

Regulatory actions undertaken by TEQSA are proportionate to the risks being managed.

Qualitative target: Outcome:

Ensure compliance assessments involve prompt, targeted action to efficiently and effectively address risks to students or the reputation of the sector. (Timeframe: Annual)

A framework to capture and report the progress of compliance assessments is in place and work is ongoing to ensure TEQSA’s compliance and enforcement activities are operationalised effectively.

Overall result: Achieved.

TEQSA | Annual Report 2019-20 47

Compliance with the HES Framework

Compliance with conditions

TEQSA’s response to a provider’s risk of non-compliance with the HES Framework is proportionate to the risk TEQSA seeks to address. If a provider is at a substantial risk of non-compliance but appears willing and able to address the concerns, TEQSA’s response may involve the imposition of conditions and/or a reduced period of registration or accreditation. This assists TEQSA to monitor the provider’s progress in addressing any deficiencies and ensures the provider implements the necessary remedy to remain compliant with the HES Framework.

In 2019-20, TEQSA conducted 183 assessments to determine compliance with conditions. TEQSA revoked 58 conditions and varied eight conditions.

As at 30 June 2020, 60 providers (34 per cent of registered providers) were subject to a total of 187 active conditions. Of these conditions, nearly half require periodic reporting to TEQSA as assurance that the providers are actively monitoring the implementation and outcomes of their rectification measures. These conditions consisted of:

> 135 conditions imposed on TEQSA registrations

> 52 conditions imposed on course accreditations.

In 2019-20, TEQSA addressed non-compliance with the HES Framework by:

> imposing 24 conditions across 14 providers

> re-registering five providers for shorter periods than the maximum seven years

> registering and re-registering 14 providers for shorter periods on CRICOS (excluding those recently granted initial TEQSA registration)

> accrediting and re-accrediting 15 courses across five providers for shorter periods (excluding newly registered providers and short courses).

The most common conditions related to compliance with:

> Domain 5 - Institutional Quality Assurance, in particular Section 5.3 Monitoring, Review and Improvement

> Domain 3 - Teaching, in particular Sections 3.1 Course Design and 3.2 Staffing

> Domain 6 - Governance and Accountability, in particular Sections 6.1 Corporate Governance and 6.2 Corporate Monitoring and Accountability.

Compliance assessments and investigations

Compliance assessments are initiated through the concerns TEQSA receives from students and the public, and in response to issues identified through the media, information from other government agencies or through information TEQSA holds, such as data from the annual risk assessment process.

48 Section 3 | PERFORMANCE REVIEW

Prior to commencing a compliance assessment, TEQSA analyses the risk, which involves a review of the information TEQSA has available, including the provider’s risk profile and regulatory history. This helps TEQSA to understand the significance, likelihood and consequence of the issues raised, to enable a decision on the most appropriate course of action to take.

In 2019-20, 103 compliance assessments were initiated and 70 compliance assessments were finalised.

External review matters In 2019-20, TEQSA was a party in 10 external review matters in the Administrative Appeals Tribunal (AAT) relating to regulatory decisions.

In addition to four matters carried over from 2018-19, six new matters commenced in the AAT in 2019-20. One matter was resolved by agreement, one matter was dismissed following withdrawal by the applicant, and the AAT affirmed TEQSA’s decision in Barque Institute Australia and Tertiary Education Quality and Standards Agency [2020] AATA 70. Seven matters were carried into 2020-21.

The areas of the HES Framework considered in the matters under review included corporate governance, staffing (including teaching staff, academic leadership and support staff), course content and delivery, academic integrity, and financial viability.

In addition to the external review matters in the AAT, Barque Institute Australia appealed the AAT’s decision to affirm TEQSA’s decision to reject its applications. That appeal is currently before the Federal Court of Australia.

TEQSA | Annual Report 2019-20 49

Action 4.2: Identify and respond to sector-wide risks to students and the reputation of the sector

Source:

2019-23 Corporate Plan, p. 19

2019-20 Portfolio Budget Statements, p. 166

Performance indicator:

TEQSA is effective in maintaining the quality of the sector.

Qualitative target: Outcome:

Review and implement a new approach to sector-wide risks in collaboration with stakeholders. (Timeframe: 2019-21)

TEQSA completed its: evaluation of the implementation by providers of admissions transparency recommendations; assessment of compliance by selected providers with English language proficiency of students; and workshops on academic integrity.

TEQSA did not progress its compliance review of ELICOS providers against the new standards due to the impact of the COVID-19 pandemic on providers.

Address sector wide risks in collaboration with stakeholders. (Timeframe: 2019-23)

Arrangements for establishing and operating the Higher Education Integrity Unit commenced.

Qualitative target: Outcome:

60 per cent or more of stakeholders rate TEQSA’s performance over the last 12 months in assuring the quality of Australian higher education, as good or excellent.

Stakeholder survey data not available due to COVID-19 pandemic.

Overall result: Achieved.

50 Section 3 | PERFORMANCE REVIEW

Addressing sector-wide risks and TEQSA’s approach to sector assessments TEQSA has proactively engaged with the sector relating to a number of sector-wide risks by providing tailored advice, workshops and toolkits and through the development and publication of good practice notes.

TEQSA published good practice notes relating to admissions transparency and to student retention. TEQSA also worked with providers to promote good practice by including a specific assessment of provider measures to prevent and address sexual assault and sexual harassment as a part of the provider re-registration process during 2019-20.

During late 2019, TEQSA ran a series of national workshops to assist providers to prevent, detect and respond to contract cheating. TEQSA subsequently released a toolkit using the information gathered from these workshops. The Academic integrity toolkit (beta version) is available at: www.teqsa.gov.au/toolkit.

Analysis of TEQSA’s financial performance For the 2019-20 financial year, TEQSA recorded a deficit of $2.14 million compared with a surplus of $0.75 million in 2018-19.

The 2019-20 Portfolio Budget Statements estimated an operating deficit of $0.79 million, which reflects the unfunded depreciation and amortisation expense.

The deficit in 2019-20 is primarily attributable to increased employee expenses relating to operating and project activities and the effect of the transition to the new lease standard AASB 16.

Management and accountability 4Corporate governanceHuman resourcesCorporate servicesFinancial management

52 Section 4 | MANAGEMENT AND ACCOUNTABILITY

Section 4: Management and accountability

Corporate governance TEQSA’s corporate governance framework incorporates:

> regulatory and management decision-making bodies

> an integrated planning framework

> systems, policies and directives such as the Enterprise Risk Management Framework and accountable authority instructions

> an ethical and accountable organisational culture

> transparency in public reporting.

Decision forums and committees

Commission The TEQSA Commission is responsible for: making regulatory decisions; setting strategic directions; monitoring risk in the sector; and deciding on matters relating to the development of TEQSA’s quality assurance and regulatory framework, and its management of strategic relationships with key stakeholders.

In 2019-20, the Commissioners met on a fortnightly basis to consider and make decisions on regulatory matters.

Accountable authority Section 132 of the TEQSA Act establishes the Commissioners as the accountable authority for the purposes of the Public Governance, Performance and Accountability Act 2013 (PGPA Act). This confers various responsibilities and powers on the accountable authority to promote high standards of accountability and performance. As the accountable authority, TEQSA Commissioners are responsible for the governance of TEQSA’s operations under the PGPA Act.

In 2019-20, Commissioners met on a quarterly basis as the accountable authority to review performance against the corporate plan, and received monthly reports on the assessment workload and financial performance. Additional meetings were held as required to consider specific matters.

The appointment of Commissioners also includes their role as the accountable authority of TEQSA. Table 16 lists the members of the accountable authority and their period of tenure in the role.

TEQSA | Annual Report 2019-20 53

Table 16: Details of accountable authority during 2019-20

Name Position title/

Position held

Period as the accountable authority or member within the reporting period

Date of

commencement

Date of cessation

Professor Nicholas Saunders TEQSA Chief Commissioner,

accountable authority

6 September 2014 28 February 2021

Professor Peter Coaldrake

TEQSA Commissioner, accountable authority

28 May 2020 27 May 2025

Professor Joan Cooper

TEQSA Commissioner, accountable authority

15 April 2019 14 April 2024

Dr Lin Martin TEQSA

Commissioner, accountable authority

1 February 2015 31 January 2020

Professor Cliff Walsh TEQSA Commissioner, accountable authority

3 February 2014 2 February 2022

Audit and Risk Committee TEQSA’s Audit and Risk Committee is established in compliance with section 42 of the PGPA Act and operates under an Audit and Risk Committee Charter, approved by the accountable authority. In 2019-20, the committee comprised three external members (including the Chair) appointed by the accountable authority. Until October 2019, the committee also included a TEQSA Commissioner as an internal member. TEQSA’s Audit and Risk Committee Charter is available at www.teqsa.gov.au/our-governance.

The Audit and Risk Committee’s role is to provide independent assurance to the accountable authority on TEQSA’s financial and non- financial performance reporting responsibilities, and oversight of risk identification and management. This includes reviewing the proposed internal triennial audit plan to ensure internal audit activities are focused on TEQSA’s key areas of financial and operational risk.

54 Section 4 | MANAGEMENT AND ACCOUNTABILITY

In 2019-20, the following internal audit was carried out: Information, Communications and Technology Service Transition-in Arrangements Review.

In 2019-20, the Audit and Risk Committee met on a quarterly basis, with additional meetings held as required to address specific matters.

Table 17: Details of the Audit and Risk Committee during 2019-20

Member name Qualifications, knowledge, skills or experience (include formal and

informal as relevant)

Number of meetings attended/ total number of

meetings

Total annual remuneration

Dr Len Gainsford, Chair

Dr Len Gainsford (B Econ Qld MBA Macq MA UNSW DBA Macq PFIIA CRMA GAICD) has 16 years as a PwC and a KPMG partner, nine years as Director Audit and Assurance in the Office of the Secretary of a large State Government Department, ten years chairing Government Audit and Risk Committees and nine years as a University Adjunct Research Fellow. His doctorate is in risk, compliance and compliance culture. He continues to meet all annual CPE requirements for Membership of the Institute of Internal Auditors.

5/5 $18,975.00 (GST

incl.)

Sally-Anne Pitt, Deputy Chair

Sally-Anne Pitt's areas of expertise include internal audit and performance audit, audit quality, risk management and corporate governance and public policy development and review. She holds a Bachelor of Applied Science, a Master of Public Policy and post-graduate business studies from the Darden Business School, University of Virginia (USA). Ms Pitt is a Professional Fellow of the Institute of Internal Auditors and a Director of their Global Board, a Certified Internal Auditor, Certified Government Auditing Professional and is qualified as a Quality Assessment Reviewer by the Institute of Internal Auditors.

5/5 $12,650.00 (GST

incl.)

TEQSA | Annual Report 2019-20 55

Table 17: Details of the Audit and Risk Committee during 2019-20 (continued)

Member name Qualifications, knowledge, skills or experience (include formal and

informal as relevant)

Number of meetings attended/ total number of

meetings

Total annual remuneration

Brandon Mack

Brandon Mack has been a senior executive in a large state government department. As a member of its leadership group he was also the lead executive in risk management, occupational health and safety and portfolio performance, reporting and oversight. His fields of expertise also include influencing organisational performance and outcomes in areas spanning major transport projects, transport and planning policy, social policy, corporate governance, corporate planning, procurement, business systems and processes, IT and internal audit. Mr Mack holds a Bachelor of Arts (Hons) degree from Monash University.

5/5 $12,650.00 (GST

incl.)

Professor Cliff Walsh

Professor Walsh's areas of expertise include public sector economics and public policy; regulatory theory and its application to economic, social and environmental issues; economic and social evaluation of public sector programs and regulatory regimes; and intergovernmental economic, political and administrative relations. Professor Walsh holds undergraduate and graduate degrees in economics from the London School of Economics and a PhD from the Australian National University.

0/1

Professor Walsh resigned from the Committee

in October 2019

-

Security Committee In 2019-20, TEQSA’s Security Committee comprised the Chief Security Officer, the Director Corporate Group, the Agency Security Advisor and the Information Technology Security Advisor. The committee met quarterly to review all aspects of protective security affecting the agency, and assist the agency to meet its compliance and reporting requirements under the Australian Government Protective Security Policy Framework. From September 2019, TEQSA’s General Counsel replaced the Chief Executive Officer as Chief Security Officer for TEQSA.

56 Section 4 | MANAGEMENT AND ACCOUNTABILITY

Planning and management

Corporate Planning The TEQSA Corporate Plan 2019-23 was:

> submitted to the Minister for Education on 14 August 2019

> approved on 29 August 2019

> published on the TEQSA website by 30 August 2019

> provided to the Minister for Finance.

Enterprise Risk Management Framework TEQSA accepts that there may be risk in any aspect of its operations and that having an appropriate strategy for risk identification and management is critical. TEQSA uses a risk-based approach for its day-to-day business and is committed to the continuous improvement of risk management practices in line with the Commonwealth Risk Management Policy and the Department of Finance Resource Management Guide 211 (ISO 31000:2009).

TEQSA’s Enterprise Risk Management Framework is underpinned by a strong organisational culture, a deep understanding of risk in relation to regulatory matters, a risk management policy and risk appetite statement, an enterprise risk register, a Fraud Control and Anti-Corruption Plan, and arrangements for staff training and support.

In 2019-20, the enterprise risk register was amended to address the risks arising from the COVID-19 pandemic.

Protective security TEQSA’s Agency Security Advisor is responsible for coordinating security functions in the agency and providing advice to the Chief Security Officer, management and staff on security matters. In 2019-20, TEQSA applied appropriate protective security measures, based on its risk profile, to ensure compliance with the mandatory requirements of the Protective Security Policy Framework.

Ethical standards TEQSA’s measures to promote ethical standards within the agency include:

> providing training for all staff in fraud and corruption awareness and conflicts of interest

> maintaining policies relating to ethical standards and behaviour relevant to TEQSA’s operational context, for example, in relation to email, internet use, fraud and disclosure of information

> integrating adherence to the Australian Public Service (APS) Code of Conduct and Values into the individual performance and development plans of TEQSA staff.

TEQSA | Annual Report 2019-20 57

External scrutiny TEQSA is subject to external scrutiny by:

> the Office of the Commonwealth Ombudsman

> the Australian National Audit Office

> the Administrative Appeals Tribunal

> the Attorney-General’s Department

> the Office of the Australian Information Commissioner

> parliamentary committees.

During 2019-20, the Commonwealth Ombudsman and parliamentary committees did not issue any reports on the operations of TEQSA. No judicial decisions, decisions of administrative tribunals, or decisions by the Australian Information Commissioner in 2019-20 had a significant impact on the operations of TEQSA.

During 2019-20, the Australian National Audit Office undertook a performance audit to assess the effectiveness of TEQSA’s regulation of higher education and reported its findings in April 2020. For further information on the performance audit in this report see Section 3: Australian National Audit Office performance audit.

During 2019-20, TEQSA officials appeared at parliamentary committee hearings for:

> 2019-20 Supplementary Budget Estimates (24 October 2019)

> 2019-20 Additional Estimates (5 March 2020).

Fraud control The Commonwealth Fraud Control Policy requires that accountable authorities provide an annual report about fraud to their Minister. Section 10 of the Public Governance Performance and Accountability Rule 2014 requires the agency to take all reasonable measures to prevent, detect and deal with fraud, including by undertaking fraud risk assessments and establishing a fraud-control plan.

TEQSA’s Fraud and Anti-Corruption Plan sets out TEQSA’s policy and approach to fraud control, procedures to effectively manage fraud and corruption risks and incidents, and relevant reporting obligations. The plan, reviewed annually by TEQSA’s Audit and Risk Committee, also provides for appropriate training and awareness-raising activities to support TEQSA staff in understanding their responsibilities in relation to fraud control.

TEQSA employees are subject to a robust employment screening process. It is compulsory for staff commencing with TEQSA to complete fraud awareness training. Staff with financial delegation are vetted by the Australian Government Security Vetting Agency (AGSVA) to a minimum of a baseline security clearance. As part of the vetting process, a financial history check is completed by AGSVA.

TEQSA adopts a zero-tolerance approach toward fraud and corruption, and aims to manage the fraud risk to a level as low as is reasonably practicable. TEQSA had no incidents of fraud to report for 2019-20. TEQSA remains committed to a proactive approach in fraud management, prevention and detection, in accordance with the Commonwealth Fraud Control Policy.

58 Section 4 | MANAGEMENT AND ACCOUNTABILITY

Service Charter TEQSA is committed to excellence in service delivery and stakeholder engagement. The TEQSA Service Charter articulates the agency’s service standards, approach to engaging with stakeholders, and handling of complaints. In 2019-20, TEQSA updated the Charter to ensure its quality assurance and regulatory approach is responsive and service-oriented. To support good practice in its handling of complaints, TEQSA ensures that students, providers and the general public are informed of options for making complaints about a provider or about TEQSA. More information is contained in this report at Appendix H: Complaints handling.

More broadly, TEQSA manages its relationships with providers in line with the APS Code of Conduct and Values, which emphasise professionalism and accountability.

More information about the TEQSA Service Charter is available at www.teqsa.gov. au/for-providers/resources/teqsa-service-charter.

Human resources The terms and conditions of employment for non-Senior Executive Service (SES) TEQSA employees are set out in the Tertiary Education Quality and Standards Agency Enterprise Agreement 2018-2021. This enterprise agreement was voted up by staff in December 2017, approved by the Fair Work Commission, and came into effect on 18 May 2018.

TEQSA maintains a shared-services arrangement with the Productivity Commission for information and communications technology, and payroll services. The arrangement is beneficial for both agencies and for TEQSA’s service delivery, significantly reducing costs.

Adjustments in response to the COVID-19 pandemic The COVID-19 pandemic presented many challenges to the agency in relation to working safely and effectively. TEQSA implemented a number of approaches to support staff, including:

> enabling of remote working from home arrangements for all staff

> roll-out of new technology platforms for communicating with providers and colleagues

> recruitment and on-boarding of new staff remotely

> support for flexible arrangements for staff with increased carer responsibilities and home schooling needs

> provision of a range of health, safety and wellbeing resources, with a particular focus on mental health.

Staffing statistics As at 30 June 2020, TEQSA employed 56 APS and 33 executive-level staff, including one SES officer and four Office Holders.

TEQSA | Annual Report 2019-20 59

From March 2020, the Chief Commissioner was appointed as the Acting CEO of TEQSA, following the departure of the previous CEO, Mr Anthony McClaran, who has taken up the position of Vice-Chancellor at St Mary’s University, UK.

More information on TEQSA’s staffing profile is included at Appendix C: Staffing profile.

Remuneration and other terms and conditions The conditions of employment for APS and executive-level employees are set out in the enterprise agreement. The agreement offers competitive terms and conditions of employment, including financial assistance for relevant professional development.

TEQSA’s Commissioners, including the Chief Commissioner, are appointed by the Minister pursuant to section 138 of the TEQSA Act, and are paid the remuneration determined by the Remuneration Tribunal. The CEO of TEQSA is also appointed by the Minister and the CEO’s remuneration is determined by the Remuneration Tribunal.

Non-salary benefits Non-salary benefits provided by the agency to employees include superannuation, home-based computer access, professional development and studies assistance, and flexible working arrangements.

Performance pay TEQSA’s enterprise agreement does not include provision for performance pay.

Performance assessment TEQSA has a formal performance management system in place for staff. This assists in:

> clarifying individual employee work tasks, responsibilities and performance

> setting performance expectations and providing feedback

> improving communication between managers and their staff (through performance appraisals)

> providing a basis for determining salary advancement within classifications, identifying learning and professional development needs and opportunities, and identifying and managing under-performance.

Learning Committee The Learning Committee is driven by a network of staff, focusing on information sharing and capability development by enhancing understanding and knowledge of strategic and emerging issues in the higher education sector.

In 2019-20, TEQSA’s Learning Committee facilitated 13 interactive sessions for staff with presenters from peak bodies, international agencies and TEQSA experts.

60 Section 4 | MANAGEMENT AND ACCOUNTABILITY

Professional development TEQSA recognises the value of a capable and high performing workforce and provides staff with learning and development opportunities to develop skills and knowledge for current and future roles and responsibilities.

In 2019-20, TEQSA provided staff with the following professional development:

> executive coaching

> diversity and inclusion awareness workshops

> health and wellbeing workshops

> case management skills

> targeted management and leadership skills development

> higher duties and secondments

> external conferences and seminars.

TEQSA’s enterprise agreement also provided access for all staff to an annual reimbursement of up to $3,000 for the cost of relevant professional development, including fees associated with an approved course of study.

Workplace consultative arrangements The agency consulted regularly with staff through a number of fora. Regular all- staff meetings provided staff with updates on a range of management and operational issues. Each group within the agency held regular meetings to raise issues and put forward ideas for improving the work environment. In addition, staff were able to provide comment and feedback through the TEQSA Staff Consultative Committee.

TEQSA experts TEQSA uses a range of external experts across discipline, pedagogical and specialised higher education policy and governance areas in undertaking its regulatory activities. The agency actively maintains a Register of Experts that staff use to select relevant experts, primarily for course accreditation or renewal of accreditation applications. The advice from experts informs the assessment of applications by TEQSA staff and their development of recommendations for decision makers.

In 2019-20, TEQSA completed its review of the Register of Experts and approach to engagement with experts. Key outcomes of the review included:

> the establishment of an Experts Advisory Board, to provide independent advice and assist with sector engagement

> the deployment of an enhanced database, with improved demographic reporting and more in-depth information on expertise to better inform staff on expert selection for assignments

> the implementation of programs and support to foster a community of best-practice for TEQSA experts, including an inaugural experts annual forum, held in conjunction with the annual TEQSA conference.

TEQSA | Annual Report 2019-20 61

In 2019-20, a total of 89 experts were engaged by TEQSA.

Table 18: Work assignments completed by experts

Financial year Completed work assignments

2017-18 191

2018-19 138

2019-20 157

Corporate services

Legal services TEQSA’s Legal Group provides, or arranges for the provision of, legal services in relation to all aspects of TEQSA’s operations.

Where necessary, the Legal Group obtains additional legal expertise from external legal service providers. The Legal Group ensures that TEQSA complies with the Legal Services Directions and other Commonwealth policies or rules relevant to the provision of legal services.

For more information about TEQSA’s legal services expenditure see www.teqsa.gov. au/our-contracts-senate-order-listing.

Information technology TEQSA’s information technology infrastructure and support is provided by the Productivity Commission under a shared-services agreement.

Under the Disability Discrimination Act 1992, Australian Government agencies are required to ensure information and services are provided in a non-discriminatory and accessible manner. The TEQSA website has been designed to meet the Australian Government Digital Service Standard established in respect to this requirement. TEQSA’s website also aims to meet the AA requirements of the World Wide Web Consortium’s Web Content Accessibility Guidelines version 2.0 (WCAG 2.0).

Financial management

Fees TEQSA operates on a partial cost-recovery basis, consistent with the Commonwealth Cost Recovery Guidelines. Section 158 of the TEQSA Act states that TEQSA may determine fees for things done in the performance of its functions. Fees collected by TEQSA under cost recovery arrangements are returned to the Australian Government’s Consolidated Revenue. TEQSA cannot determine fees without the Minister’s approval.

62 Section 4 | MANAGEMENT AND ACCOUNTABILITY

As part of the Australian Government’s Higher Education Relief Package, TEQSA refunded fees and charges invoiced from 1 January 2020. This measure will be in place until 30 June 2021. As of 30 June 2020, $1.1 million in fees for 70 providers had been waived and $0.65 million in fees had been refunded to 31 providers.

TEQSA developed its initial fee schedule based on parameters set by the Australian Government in 2011 and TEQSA’s status as a partial cost recovery agency. In the 2018-19 Budget it was announced that TEQSA will progressively transition from partial cost recovery to a full cost recovery model, now scheduled to commence on 1 July 2021.

Fees payable as at 30 June 2020 are available at: www.legislation.gov.au/Details/ F2020C00728.

Performance against core purchasing policies All contracts adhered to the core policies and principles of the Commonwealth Procurement Rules throughout the reporting period. An appropriate approach to market was made for all procurements covered by the Commonwealth Procurement Rules.

Competitive tendering and contracting TEQSA’s Accountable Authority Instructions and Procurement Manual require compliance with the Commonwealth Procurement Rules.

All contracts with a value of $10,000 or more (inclusive of GST) entered into by TEQSA in 2019-20 were lodged on AusTender.

Procurement initiatives to support small business TEQSA supports small business participation in the Commonwealth Government procurement market. Small and Medium Enterprises (SME) and Small Enterprise participation statistics are available on the Department of Finance’s website.

TEQSA employs a number of procurement practices to support SMEs including:

> use of the Commonwealth Contracting Suite for low-risk procurements valued under $200,000

> applying the Small Business Engagement Principles to effectively engage and communicate with small businesses

> seeking opportunities to engage Aboriginal and Torres Strait Islander businesses

> use of electronic payment systems to facilitate on-time payments.

Exempt contracts TEQSA had no contracts in excess of $10,000 (inclusive of GST) that were exempted by the Chief Executive Officer from being published on AusTender because it would disclose exempt matters under the Freedom of Information Act 1982.

TEQSA | Annual Report 2019-20 63

Australian National Audit Office access clauses No contracts were let during the year for $100,000 or more (inclusive of GST) with provisions to exempt Australian National Audit Office access to contractors’ premises.

Consultancies TEQSA uses consultancy services to obtain specialist expertise or independent advice to investigate or diagnose a defined issue or problem, carry out defined reviews or evaluations, and provide creative solutions to assist in the agency’s decision making.

The selection and engagement of consultants was conducted in accordance with the PGPA Act, Commonwealth Procurement Rules, and internal policies and procedures. Table 19 states the number of new and ongoing contracts during 2019-20 and the expenditure on them.

Annual Reports contain information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website at www.tenders.gov.au.

Table 19: Consultancy contracts and expenditure, 2019-20

Total

Number of new contracts entered into during the period 7

Total actual expenditure during the period on new contracts (including GST) $310,755

Number of ongoing contracts engaging consultants that were entered into during the previous period 2

Total actual expenditure during the period on ongoing contracts (including GST) $116,786

Grants TEQSA does not administer any discretionary grants programs.

TEQSA’s engagement with the sector was extensive during 2019-20, starting with the review of the risk assessment framework and later in response to the move to online learning.

Financial report

5Independent Auditor’s reportStatement by the accountable authority and Chief Financial OfficerFinancial statement

66 Section 5 | FINANCIAL REPORT

GPO Box 707 CANBERRA ACT 2601 38 Sydney Avenue FORREST ACT 2603 Phone (02) 6203 7300 Fax (02) 6203 7777

INDEPENDENT AUDITOR’S REPORT

To the Minister for Education

Opinion

In my opinion, the financial statements of the Tertiary Education Quality and Standards Agency (the Entity) for  the year ended 30 June 2020:  

(a) comply  with  Australian  Accounting  Standards  -  Reduced  Disclosure  Requirements  and  the  Public Governance, Performance and Accountability (Financial Reporting) Rule 2015; and

(b) present fairly the financial position of the Entity as at 30 June 2020 and its financial performance and cash flows for the year then ended.

The financial statements of the Entity, which I have audited, comprise the following as at 30 June 2020 and for  the year then ended:  

 Statement by the Accountable Authority and Chief Financial Officer;  Statement of Comprehensive Income;  Statement of Financial Position;  Statement of Changes in Equity;  Cash Flow Statement;  Administered Schedule of Comprehensive Income;  Administered Schedule of Assets and Liabilities;  Administered Reconciliation Schedule;  Administered Cash Flow Statement; and  Notes to and forming part of the financial statements, comprising a summary of significant accounting

policies and other explanatory information.

Basis for opinion

I  conducted  my  audit  in  accordance  with  the  Australian  National  Audit  Office  Auditing  Standards,  which  incorporate the Australian Auditing Standards. My responsibilities under those standards are further described  in the Auditor’s Responsibilities for the Audit of the Financial Statements section of my report. I am independent  of the Entity in accordance with the relevant ethical requirements for financial statement audits conducted by  the  Auditor‐General  and  his  delegates.  These  include  the  relevant  independence  requirements  of  the  Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants  (including Independence Standards) (the Code) to the extent that they are not in conflict with the Auditor‐ General Act 1997. I have also fulfilled my other responsibilities in accordance with the Code. I believe that the  audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. 

Other information

The Accountable Authority is responsible for the other information. The other information comprises the  information included in the annual report for the year ended 30 June 2020 but does not include the financial  statements and my auditor’s report thereon. 

My opinion on the financial statements does not cover the other information and accordingly I do not express  any form of assurance conclusion thereon. 

In connection with my audit of the financial statements, my responsibility is to read the other information and,  in doing so, consider whether the other information is materially inconsistent with the financial statements or  my knowledge obtained in the audit, or otherwise appears to be materially misstated. 

TEQSA | Annual Report 2019-20 67

If,  based  on  the  work  I  have  performed,  I  conclude  that  there  is  a  material  misstatement  of  this  other  information, I am required to report that fact. I have nothing to report in this regard. 

Accountable Authority’s responsibility for the financial statements

As the Accountable Authority of the Entity, the Commissioners are responsible under the Public Governance,  Performance and Accountability Act 2013 (the Act) for the preparation and fair presentation of annual financial  statements that comply with Australian Accounting Standards - Reduced Disclosure Requirements and the rules  made  under  the  Act.  The  Commissioners  is  also  responsible  for  such  internal  control  as  the  Commissioners  determine  is  necessary  to  enable  the  preparation  of  financial  statements  that  are  free  from  material  misstatement, whether due to fraud or error.  

In preparing the financial statements, the Commissioners are responsible for assessing the ability of the Entity  to continue as a going concern, taking into account whether the Entity’s operations will cease as a result of an  administrative restructure or for any other reason. The Commissioners are also responsible for disclosing, as  applicable,  matters  related  to  going  concern  and  using  the  going  concern  basis  of  accounting  unless  the  assessment indicates that it is not appropriate. 

Auditor’s responsibilities for the audit of the financial statements

My objective is to obtain reasonable assurance about whether the financial statements as a whole are free from  material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion.  Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance  with the Australian National Audit Office Auditing Standards will always detect a material misstatement when it  exists.  Misstatements  can  arise  from  fraud  or  error  and  are  considered  material  if,  individually  or  in  the  aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis  of the financial statements. 

As  part  of  an  audit  in  accordance  with  the  Australian  National  Audit  Office  Auditing  Standards,  I  exercise  professional judgement and maintain professional scepticism throughout the audit. I also:  

 identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient  and  appropriate  to  provide  a  basis  for  my  opinion.  The  risk  of  not  detecting  a  material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;  obtain an understanding of internal control relevant to the audit in order to design audit procedures that are

appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Entity’s internal control;  evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Accountable Authority;  conclude on the appropriateness of the Accountable Authority’s use of the going concern basis of accounting

and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Entity’s ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor’s report. However, future events or conditions may cause the Entity to cease to continue as a going concern; and  evaluate  the  overall  presentation,  structure  and  content  of  the  financial  statements,  including  the

disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

I communicate with the Accountable Authority regarding, among other matters, the planned scope and timing  of the audit and significant audit findings, including any significant deficiencies in internal control that I identify  during my audit. 

68 Section 5 | FINANCIAL REPORT

Australian National Audit Office 

Peter Kerr 

Executive Director 

Delegate of the Auditor‐General 

Canberra 

31 August 2020 

TEQSA | Annual Report 2019-20 69

Contents

Certification 70

Primary financial statement Statement of Comprehensive Income 71

Statement of Financial Position 73

Statement of Changes in Equity 75

Cash Flow Statement 77

Administered Schedule of Comprehensive Income 79

Administered Schedule of Assets and Liabilities 80

Administered Reconciliation Schedule 81

Administered Cash Flow Statement 82

Notes to the financial statements Overview 83

1. Financial Performance

1.1 Expenses 87

1.2 Own-Source Revenue and Gains 89

2. Income and Expenses Administered on Behalf of Government

2.1 Administered - Expenses 91

2.2 Administered - Income 91

3. Financial Position

3.1 Financial Assets 92

3.2 Non-Financial Assets 93

3.3 Payables 97

3.4 Other Provisions 98

4. Assets and Liabilities Administered on Behalf of Government

4.1 Administered - Assets 99

4.2 Administered - Liabilities 99

5. Funding

5.1 Appropriations 100

5.2 Regulatory Charging Summary 101

6. People and Relationships

6.1 Employee Provisions 102

6.2 Key Management Personnel Remuneration 103

6.3 Related Party Disclosures 103

7. Managing Uncertainties

7.1 Contingent Assets and Liabilities 104

7.2 Financial Instruments 104

8. Other Information

8.1 Aggregate Assets and Liabilities 106

Section 5: Financial report

70 Section 5 | FINANCIAL REPORT

STATEMENT BY THE ACCOUNTABLE AUTHORITY AND CHIEF FINANCIAL OFFICER

Professor Nicholas Saunders, AO Robert Oliphant

Chief Commissioner Chief Financial Officer

on behalf of the Accountable Authority

28 August 2020 28 August 2020

In our opinion, the attached financial statements for the year ended 30 June 2020 comply with subsection 42(2) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act), and are based on properly maintained financial records as per subsection 41(2) of the PGPA Act.

In our opinion, at the date of this statement, there are reasonable grounds to believe that the Tertiary Education Quality and Standards Agency will be able to pay its debts as and when they fall due.

TEQSA | Annual Report 2019-20 71

for the period ended 30 June 2020

2020 2019

Original Budget1

Notes $'000 $'000 $'000

NET COST OF SERVICES Expenses Employee Benefits 1.1A 10,828 8,231 11,277

Suppliers 1.1B 7,545 7,971 6,488

Depreciation and amortisation 3.2A 2,338 1,075 789

Finance Costs 1.1C 42 80 91

Write-down and impairment of other assets - 6 -

Losses from asset disposals - 236 -

Total expenses 20,753 17,599 18,645

Own-Source Income

Own-source revenue Revenue from contracts with customers 1.2A 741 87 5

Rental Income 1.2B 269 266 259

Resources received free of charge 1.2C 61 46 53

Total own-source revenue 1,071 399 317

Net (cost of)/contribution by services (19,682) (17,200) (18,328)

Revenue from Government 1.2D 17,539 17,938 17,539

(2,143) 738 (789)

OTHER COMPREHENSIVE INCOME

Changes in asset revaluation surplus - 16 -

Total other comprehensive income - 16 -

Total comprehensive (loss)/income (2,143) 754 (789)

The above statement should be read in conjunction with the accompanying notes.

1 Original Budget reflects the figures in the 2019-20 Portfolio Budget Statements (PBS).

Tertiary Education Quality and Standards Agency STATEMENT OF COMPREHENSIVE INCOME

(Deficit)/Surplus attributable to the Australian Government

Items not subject to subsequent reclassification to net cost of services

72 Section 5 | FINANCIAL REPORT

for the period ended 30 June 2020

Tertiary Education Quality and Standards Agency STATEMENT OF COMPREHENSIVE INCOME

Budget Variances Commentary

Statement of Comprehensive Income

Affected line items

Expenses Suppliers

Expenses Depreciation and amortisation

Income Revenue from contracts with customers The increase in own-source revenue is attributed to ticket sales generated from the 2019 TEQSA Conference.

The increase in depreciation and amortisation expense is attributed to the transition to AASB 16 Leases. Depreciation expense associated with right of use assets was not captured in the original budget preparation.

Explanations of major variances

Supplier expenses is greater than budget due to the increase in contractor utilisation and the timing of project based activities within the agency. TEQSA engages contractors to temporarily fill positions due to staff movements and timing of recruitment activities.

TEQSA | Annual Report 2019-20 73

as at 30 June 2020

2020 2019

Original Budget1

Notes $'000 $'000 $'000

ASSETS Financial assets Cash and Cash Equivalents 3.1A 207 289 160

Trade and Other Receivables 3.1B 8,402 9,913 9,762

Total financial assets 8,609 10,202 9,922

Non-financial assets2 Buildings 3.2A 2,588 618 557

Plant and Equipment 3.2A 303 425 255

Intangibles - Computer Software 3.2A 1,299 998 1,515

Other Non-Financial Assets 3.2B 158 302 174

Total non-financial assets 4,348 2,343 2,501

Total assets 12,957 12,545 12,423

LIABILITIES Payables Suppliers 3.3A 622 628 314

Other Payables 3.3B 167 1,164 861

Total payables 789 1,792 1,175

Interest bearing liabilities Leases 3.3C 2,231 - -

Total interest bearing liabilities 2,231 - -

Provisions Employee Provisions 6.1 2,484 2,060 3,481

Other Provisions 3.4A 538 825 712

Total provisions 3,022 2,885 4,193

Total liabilities 6,042 4,677 5,368

Net assets 6,915 7,868 7,055

EQUITY Contributed equity 13,287 13,060 13,906

Reserves 16 16 -

Retained surplus/(Accumulated deficit) (6,388) (5,208) (6,851)

Total equity 6,915 7,868 7,055

The above statement should be read in conjunction with the accompanying notes.

1 Original Budget reflects the figures in the 2019-20 Portfolio Budget Statements (PBS). 2 Right-of-use assets are included in "Buildings" line item.

STATEMENT OF FINANCIAL POSITION Tertiary Education Quality and Standards Agency

74 Section 5 | FINANCIAL REPORT

as at 30 June 2020 STATEMENT OF FINANCIAL POSITION

Tertiary Education Quality and Standards Agency

Budget Variances Commentary

Statement of Financial Position

Affected line items Trade and Other Receivables

Buildings

Plant and Equipment

Intangibles - Computer Software

Suppliers

Other Payables

Leases

Employee Provisions

Other Provisions

The net book value of plant and equipment has exceeded budget due to additional purchase of IT and office equipment.

The net book value of intangible assets is below budget due to the timing and progress of the CRM re-development and ICT cloud infrastructure projects and lower depreciation during the year.

Explanations of major variances Trade and other receivables is lower than budget due to the decrease in appropriation receivables balance, reflecting a higher than budgeted spending on regulatory activities.

Buildings include right-of-use assets which was not captured in the original budget preparation.

Supplier payables has exceeded budget due to a higher than expected trade creditors and accruals from timing of payments to vendors.

Other payables is below budget due to the adjustment of TEQSA's lease incentive and straightlining balances at transition to AASB 16 Leases. These amounts have been adjusted against retained earnings.

The lease liability represents the future payments associated with TEQSA's leased right of use assets. This was not captured in the original budget preparation.

Employee provisions is below budget due to a revision of the assumptions used in calculating the provision at year-end.

Other payables is below budget due to the adjustment of TEQSA's onerous lease provision at transition to AASB 16 against the right of use asset.

TEQSA | Annual Report 2019-20 75

Tertiary Education Quality and Standards Agency STATEMENT OF CHANGES IN EQUITY for the period ended 30 June 2020

2020 2019

Original Budget1

$'000 $'000 $'000

CONTRIBUTED EQUITY Opening balance Balance carried forward from previous period 13,060 11,414 13,060

Transactions with owners Distribution to owners Departmental equity returns (619) - -

Contributions by owners Departmental capital budget 846 1,646 846

Total transactions with owners 227 1,646 846

Closing balance as at 30 June 13,287 13,060 13,906

RETAINED EARNINGS Opening balance Balance carried forward from previous period (5,208) (5,946) (6,062)

Adjustment on initial application of AASB 16 963 - -

Adjusted opening balance (4,245) (5,946) (6,062)

Comprehensive income (Deficit)/Surplus for the period (2,143) 738 (789)

Total comprehensive income (2,143) 738 (789)

Closing balance as at 30 June (6,388) (5,208) (6,851)

ASSET REVALUATION RESERVE Opening balance Balance carried forward from previous period 16 - -

Comprehensive income Other comprehensive income - 16 -

Total comprehensive income - 16 -

Closing balance as at 30 June 16 16 -

TOTAL EQUITY

Opening balance Balance carried forward from previous period 7,868 5,468 6,998

Adjustment on initial application of AASB 16 963 - -

Adjusted opening balance 8,831 5,468 6,998

Comprehensive income (Deficit)/Surplus for the period (2,143) 738 (789)

Other comprehensive income - 16 -

Total comprehensive income (2,143) 754 (789)

Transactions with owners Distribution to owners Departmental equity returns (619) - -

Contributions by owners Departmental capital budget 846 1,646 846

Total transactions with owners 227 1,646 846

Closing balance as at 30 June 6,915 7,868 7,055

The above statement should be read in conjunction with the accompanying notes.

1 Original Budget reflects the figures in the 2019-20 Portfolio Budget Statements (PBS).

76 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency STATEMENT OF CHANGES IN EQUITY for the period ended 30 June 2020

Accounting Policy

Equity Injections

Other Distributions to Owners

Budget Variances Commentary

Statement of Changes in Equity

Major budget variances for balances contained in the Statement of Changes in Equity have been included in the budget variances commentary for the Statement of Comprehensive Income and the Statement of Financial Position.

Amounts appropriated which are designated as ‘equity injections’ for a year (less any formal reductions) and Departmental Capital Budgets (DCBs) are recognised directly in contributed equity in that year.

Restructuring of Administrative Arrangements Net assets received from or relinquished to another Government entity under a restructuring of administrative arrangements are adjusted at their book value directly against contributed equity.

The FRR require that distributions to owners be debited to contributed equity unless it is in the nature of a dividend.

TEQSA | Annual Report 2019-20 77

Tertiary Education Quality and Standards Agency

for the period ended 30 June 2020

2020 2019

Original Budget1

Notes $’000 $’000 $’000

OPERATING ACTIVITIES Cash received Appropriations 20,202 16,855 16,966

Rendering of services 327 317 264

GST received 863 687 647

Other 618 204 59

Total cash received 22,010 18,063 17,936

Cash used Employees 10,315 7,639 10,357

Suppliers 8,311 8,967 6,654

Interest payments on lease liabilities 30 - -

GST paid 11 1 647

Other - section 74 receipts transferred to OPA 1,738 1,360 477

Total cash used 20,405 17,967 18,135

Net cash from/(used by) operating activities 1,605 96 (199)

INVESTING ACTIVITIES

Cash used

897 378 647

Total cash used 897 378 647

Net cash from/(used by) investing activities (897) (378) (647)

FINANCING ACTIVITIES

Cash received Other - contributed equity 737 411 846

Total cash received 737 411 846

Cash used Principal payments of lease liabilities 1,527 - -

Total cash used 1,527 - -

Net cash from/(used by) financing activities (790) 411 846

Net increase/(decrease) in cash held (82) 129 -

289 160 160

3.1A 207 289 160

The above statement should be read in conjunction with the accompanying notes.

1 Original Budget reflects the figures in the 2019-20 Portfolio Budget Statements (PBS).

CASH FLOW STATEMENT

Cash and cash equivalents at the beginning of the reporting period Cash and cash equivalents at the end of the reporting period

Purchase of plant and equipment and intangibles

78 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency

for the period ended 30 June 2020 CASH FLOW STATEMENT

Budget Variances Commentary Cash Flow Statement

Affected line items Operating activities Appropriations (cash received)

Operating activities GST received

Operating activities Other (cash received) Operating activities Suppliers

Operating activities GST paid Operating activities Other - section 74 receipts transferred to OPA

Explanation of major variances Appropriation received was higher than budget due to increased supplier expenses surrounding contractor utilisation and the timing of project based activities within the agency.

GST received is higher than budget due to increase in supplier expenses which has resulted in TEQSA paying more GST during the financial year.

Section 74 receipts is higher than budget due to increase in miscellaneous receipts during the year.

Other cash receipts was higher than budget due to revenue collected from ticket sales for the TEQSA 2019 Conference.

Cash paid to suppliers has exceeded budget due to higher than anticipated costs associated with contractors and the timing of project based activities within the agency. This is reflected in the higher than anticipated appropriation received.

GST paid is lower than budget as majority of TEQSA miscellaneous receipts do not attract GST.

TEQSA | Annual Report 2019-20 79

for the period ended 30 June 2020

2020 2019

Original Budget1

Notes $’000 $'000 $'000

NET COST OF SERVICES

Income

Revenue Non-taxation revenue Fees 2.2A 1,182 1,969 7,427

Total non-taxation revenue 1,182 1,969 7,427

Total revenue 1,182 1,969 7,427

Total income 1,182 1,969 7,427

The above schedule should be read in conjunction with the accompanying notes.

1 Original Budget reflects the figures in the 2019-20 Portfolio Budget Statements (PBS).

Budget Variances Commentary

Administered Schedule of Comprehensive Income

Affected line items Non-taxation revenue Fees

Tertiary Education Quality and Standards Agency ADMINISTERED SCHEDULE OF COMPREHENSIVE INCOME

Explanation of major variances Administered fee revenue is lower than budget due to the government relief measures in response to the COVID-19 pandemic. The budget measures include the refund and waivers of fees from 1 January 2020, and the deferral of TEQSA's cost recovery arrangements until 1 July 2021.

80 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency ADMINISTERED SCHEDULE OF ASSETS AND LIABILITIES as at 30 June 2020

2020 2019

Original Budget1

Notes $’000 $'000 $'000

LIABILITIES Payables Suppliers 4.2A 52 - -

Total payables 52 - -

Total liabilities administered on behalf of Government

52 - -

Net assets/(liabilities) (52) - -

The above schedule should be read in conjunction with the accompanying notes.

1 Original Budget reflects the figures in the 2019-20 Portfolio Budget Statements (PBS).

Budget Variances Commentary

Administered Schedule of Assets and Liabilities

Affected line items Supplier payables

Explanation of major variances Supplier payables at 30 June 2020 represent refunds owed to eligible providers under the Higher Education Relief Package in response to the COVID-19 pandemic.

TEQSA | Annual Report 2019-20 81

Tertiary Education Quality and Standards Agency ADMINISTERED RECONCILIATION SCHEDULE for the period ended 30 June 2020

2020 2019

Notes $’000 $’000

Opening assets less liabilities as at 1 July - -

Net contribution by services Income 1,182 1,970

Transfers (to)/from the Australian Government

Appropriation transfers from Official Public Account Special appropriations (unlimited) Payments to entities other than corporate Commonwealth entities 677 6

Appropriation transfers to OPA Transfers to OPA (1,911) (1,976)

Closing assets less liabilities as at 30 June (52) -

The above schedule should be read in conjunction with the accompanying notes.

Accounting Policy

Revenue collected by the entity for use by the Government rather than the entity is administered revenue. Collections are transferred to the Official Public Account (OPA) maintained by the Department of Finance. Conversely, cash is drawn from the OPA to make payments under Parliamentary appropriation on behalf of Government. These transfers to and from the OPA are adjustments to the administered cash held by the entity on behalf of the Government and reported as such in the schedule of administered cash flows and in the administered reconciliation schedule.

Administered Cash Transfers to and from the Official Public Account

82 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency ADMINISTERED CASH FLOW STATEMENT for the period ended 30 June 2020

2020 2019

$’000 $'000

OPERATING ACTIVITIES Cash received Fees 1,911 1,976

Total cash received 1,911 1,976

Cash used Refunds to higher education providers 677 6

Total cash used 677 6

Net cash from/(used by) operating activities 1,234 1,970

Cash and cash equivalents at the beginning of the reporting period - -

Cash from Official Public Account Appropriations 677 6

Total cash from official public account 677 6

Cash to Official Public Account Appropriations (1,911) (1,976)

Total cash to official public account (1,911) (1,976)

Cash and cash equivalents at the end of the reporting period - -

This schedule should be read in conjunction with the accompanying notes.

TEQSA | Annual Report 2019-20 83

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Overview

AASB 15 Revenue from Contracts with Customers;

AASB 2016-8 Amendments to Australian Accounting Standards - Australian Implementation Guidance for Not-for-Profit Entities; and

AASB 1058 Income of Not-For-Profit Entities

AASB 15, AASB 2016-8 and AASB 1058 became effective 1 July 2019.

AASB 15 establishes a comprehensive framework for determining whether, how much and when revenue is recognised. It replaces existing revenue recognition guidance, including AASB 118 Revenue, AASB 111 Construction Contracts and Interpretation 13 Customer Loyalty Programmes . The core principle of AASB 15 is that an entity recognises revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

AASB 1058 is relevant in circumstances where AASB 15 does not apply. AASB 1058 replaces most of the not-for-profit (NFP) provisions of AASB 1004 Contributions and applies to transactions where the consideration to acquire an asset is significantly less than fair value principally to enable the entity to further its objectives, and where volunteer services are received.

The details of the changes in accounting policies, transitional provisions and adjustments are disclosed below and in the relevant notes to the financial statements.

Nature of change in accounting policy, transitional provisions, and adjustment to financial statements

The standards that were issued prior to the sign-off date and adopted for the first time in the current reporting period are detailed below:

Standard / Interpretation

Adoption of New Australian Accounting Standard Requirements No accounting standard has been adopted earlier than the application date as stated in the standard. All other new, revised, amended standards and/or interpretations that were issued prior to the sign-off date and are applicable to future reporting period(s) are not expected to have a future material impact on the Agency's financial statements.

The Basis of Preparation

The financial statements are general purpose financial statements and are required by section 42 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act).

The financial statements have been prepared in accordance with: a) Public Governance, Performance and Accountability (Financial Reporting) Rule 2015 (FRR); and b) Australian Accounting Standards and Interpretations - Reduced Disclosure Requirements issued by the Australian Accounting Standards Board (AASB) that apply for the reporting period.

The financial statements have been prepared on an accrual basis and in accordance with the historical cost convention, except for certain assets and liabilities at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position. The financial statements are presented in Australian dollars.

New Accounting Standards

84 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Impact on transition

1 July 2019

$'000

Departmental

Assets Cash - third party accounts 115

Total assets 115

Liabilities Unearned revenue 115

Total liabilities 115

Total adjustment recognised in retained earnings -

AASB 16 Leases

Application of AASB 15 Revenue from Contracts with Customers / AASB 1058 Income of Not-For-Profit Entities

TEQSA adopted AASB 15 and AASB 1058 using the modified retrospective approach, under which the cumulative effect of initial application is recognised in retained earnings at 1 July 2019. Accordingly, the comparative information presented for 2019 is not restated, that is, it is presented as previously reported under the various applicable AASB's and related interpretations.

Under the new income recognition model, TEQSA shall first determine whether an enforceable agreement exists and whether the promises to transfer goods or services to the customer are ‘sufficiently specific’. If an enforceable agreement exists and the promises are ‘sufficiently specific’ (to a transaction or part of a transaction), TEQSA applies the general AASB 15 principles to determine the appropriate revenue recognition. If these criteria are not met, TEQSA shall consider whether AASB 1058 applies.

In relation to AASB 15, TEQSA elected to apply the new standard to all new and uncompleted contracts from the date of initial application. TEQSA is required to aggregate the effect of all of the contract modifications that occur before the date of initial application.

In terms of AASB 1058, TEQSA is required to recognise volunteer services at fair value if those services would have been purchased if not provided voluntarily, and the fair value of those services can be measured reliably.

AASB 16 became effective on 1 July 2019.

This new standard has replaced AASB 117 Leases , Interpretation 4 Determining whether an Arrangement contains a Lease , Interpretation 115 Operating Leases—Incentives and Interpretation 127 Evaluating the Substance of Transactions Involving the Legal Form of a Lease.

AASB 16 provides a single lessee accounting model, requiring the recognition of assets and liabilities for all leases, together with options to exclude leases where the lease term is 12 months or less, or where the underlying asset is of low value. AASB 16 substantially carries forward the lessor accounting in AASB 117, with the distinction between operating leases and finance leases being retained. The details of the changes in accounting

policies, transitional provisions and adjustments are disclosed below and in the relevant notes to the financial statements.

Standard / Interpretation

Nature of change in accounting policy, transitional provisions, and adjustment to financial statements

The impact on transition is summarised below:

TEQSA | Annual Report 2019-20 85

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

AASB 15 / AASB 1058

Previous AAS

Increase / (decrease)

$’000 $’000 $’000

Assets

Cash - third party accounts 115 115 -

Total Assets 115 115 -

Liabilities Unearned Revenue 115 115 -

Total Liabilities 115 115 -

Retained earnings - - -

Application of AASB 16 Leases

TEQSA adopted AASB 16 using the modified retrospective approach, under which the cumulative effect of initial application is recognised in retained earnings at 1 July 2019. Accordingly, the comparative information presented for 2019 is not restated, that is, it is presented as previously reported under AASB 117 and related interpretations.

TEQSA elected to apply the practical expedient to not reassess whether a contract is, or contains a lease at the date of initial application. Contracts entered into before the transition date that were not identified as leases under AASB 117 were not reassessed. The definition of a lease under AASB 16 was applied only to contracts entered into or changed on or after 1 July 2019.

Set out below are the amounts by which each financial statement line item is affected as at and for the year ended 30 June 2020 as a result of the adoption of AASB 15 and AASB 1058. The first column shows amounts prepared under AASB 15 and AASB 1058 and the second column shows what the amounts would have been had AASB 15 and AASB 1058 not been adopted:

AASB 16 provides for certain optional practical expedients, including those related to the initial adoption of the standard. TEQSA applied the following practical expedients when applying AASB 16 to leases previously classified as operating leases under AASB 117:

• Apply a single discount rate to a portfolio of leases with reasonably similar characteristics; • Exclude initial direct costs from the measurement of right-of-use assets at the date of initial application for leases where the right-of-use asset was determined as if AASB 16 had been applied since the commencement date;

• Reliance on previous assessments on whether leases are onerous as opposed to preparing an impairment review under AASB 136 Impairment of assets as at the date of initial application; and

• Applied the exemption not to recognise right-of-use assets and liabilities for leases with less than 12 months of lease term remaining as of the date of initial application.

As a lessee, TEQSA previously classified leases as operating or finance leases based on its assessment of whether the lease transferred substantially all of the risks and rewards of ownership. Under AASB 16, TEQSA recognises right-of-use assets and lease liabilities for most leases. However, TEQSA has elected not to recognise right-of-use assets and lease liabilities for some leases of low value assets based on the value of the underlying asset when new or for short-term leases with a lease term of 12 months or less.

On adoption of AASB 16, TEQSA recognised right-of-use assets and lease liabilities in relation to leases of office space which had previously been classified as operating leases.

The lease liabilities were measured at the present value of the remaining lease payments, discounted using TEQSA's incremental borrowing rate as at 1 July 2019. TEQSA's incremental borrowing rate is the rate at which a similar borrowing could be obtained from an independent creditor under comparable terms and conditions.

The right-of-use assets relating to office space were measured at an amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments.

86 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Impact on transition

1 July 2019

$'000

Departmental Right-of-use assets - office space 3,591

Lease liabilities 3,758

Retained earnings 963

$'000

6,132

-

-

(613)

(1,710)

Plus: effect of extension options reasonable certain to be exercised -

3,809

(51)

3,758

Reporting of Administered activities

Departmental

Administered

There were no subsequent events that had the potential to significantly affect the ongoing structure and financial activities of TEQSA.

There were no subsequent events that had the potential to significantly affect the ongoing structure and financial activities of TEQSA.

Except where otherwise stated, administered items are accounted for on the same basis and using the same policies as for departmental items, including the application of Australian Accounting Standards.

Events After the Reporting Period

Less: short-term leases not recognised under AASB 16

1 July 2019

Minimum operating lease commitment at 30 June 2019

Less: inclusion of GST at 30 June 2019 disclosures

Less: inclusion of property related expenses (non lease)

Taxation

The entity is exempt from all forms of taxation except Fringe Benefits Tax (FBT) and the Goods and Services Tax (GST).

Administered revenues, expenses, assets, liabilities and cash flows are disclosed in the administered schedules and related notes.

Less: low value leases not recognised under AASB 16

Undiscounted lease payments Less: effect of discounting using the incremental borrowing rate as at the date of initial application

Lease liabilities recognised at 1 July 2019

The following table reconciles TEQSA's minimum lease commitments disclosed in the entity's 30 June 2019 annual financial statements to the amount of lease liabilities recognised on 1 July 2019:

On transition to AASB 16, TEQSA recognised additional right-of-use assets and additional lease liabilities, recognising the difference in retained earnings. The impact on transition is summarised below:

TEQSA | Annual Report 2019-20 87

2020 $'000

1.1A: Employee Benefits Wages and salaries 8,464

Superannuation Defined contribution plans 1,003

Defined benefit plans 338

Leave and other entitlements 1,023

Total employee benefits 10,828

Accounting Policy

408 372

2,791 2,882

321 420

979 799

490 598

197 337

350 317

737 213

552 51

652 636

Total goods and services supplied or rendered 7,477 6,625

620 371

6,857 6,254

Total goods and services supplied or rendered 7,477 6,625

Other suppliers

68 75

- 1,271

68 1,346

7,545 7,971 Total suppliers

1 TEQSA has applied AASB 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under AASB 117.

The above lease disclosures should be read in conjunction with the accompanying notes 1.1C, 1.2B, 3.2A and 3.3C.

850 8,231

1.1B: Suppliers

Goods and services supplied or rendered Consultants

2019 $'000

6,366

691 324

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

1. Financial Performance This section analyses the financial performance of the Tertiary Education Quality and Standards Agency for the year ended 2020.

1.1 Expenses

Accounting policies for employee related expenses is contained in the People and Relationships section.

Contractors Travel IT services Expert fees Legal fees

Workers compensation expenses

TEQSA has no short term lease commitments as at 30 June 2020.

Recruitment and training Property operating expenses

Other

Goods supplied Services rendered

Operating lease rentals1 Total other suppliers

Event costs

88 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Accounting Policy

2020 $'000

1.1C: Finance Costs Interest on lease liabilities 30 -

Unwinding of discount 12 80

Total finance costs 42 80

Accounting Policy

All borrowing costs are expensed as incurred.

2019 $'000

The above lease disclosures should be read in conjunction with the accompanying notes 1.1B, 1.2B, 3.2A and 3.3C.

TEQSA has elected not to recognise right-of-use assets and lease liabilities for short-term leases of assets that have a lease term of 12 months or less and leases of low-value assets (less than $10,000). TEQSA recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

Short-term leases and leases of low-value assets

TEQSA | Annual Report 2019-20 89

2020 2019

$'000 $'000

1.2A: Revenue from contracts with customers Rendering of services 741 87

Total revenue from contracts with customers 741 87

Disaggregation of revenue from contracts with customers

Service category: TEQSA Conference 719 80

Miscellaneous / Other 22 7

741 87

Type of customer: Australian Government entities (related parties) 8 -

Non-government entities 733 87

741 87

Timing of transfer of goods and services: Over time - -

Point in time 741 87

741 87

Accounting Policy

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

1.2 Own-Source Revenue and Gains

Own-Source Revenue

TEQSA is a not-for-profit, non-corporate Commonwealth entity. TEQSA collects minor miscellaneous fees from freedom of information requests and reimbursements of staff costs to attend sector-based events. TEQSA generates ticket sales revenue associated with the annual TEQSA Conference. Revenue is recognised upon receipt, or at the conclusion of the event.

The transaction price is the total amount of consideration to which the TEQSA expects to be entitled in exchange for transferring promised goods or services to a customer. The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both.

Receivables for goods and services, which have 30 day terms (2019: 30 days), are recognised at the nominal amounts due less any impairment allowance account. Collectability of debts is reviewed at end of the reporting period. Allowances are made when collectability of the debt is no longer probable.

Revenue from rendering of services is recognised when performance obligations have been satisfied and delivered to the customer in accordance with the contract or agreed-upon milestones.

90 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

2020 2019

$'000 $'000

269 266

269 266

Within 1 year 320 315

One to two years 223 329

Two to three years - 228

Total undiscounted lease payments receivable 543 872

Note: the total undiscounted lease payments receivable is GST inclusive where relevant.

1.2C: Other Revenue Resources received free of charge Remuneration of auditors 46 46

Expert services 15 -

Total other revenue 61 46

Accounting Policy

Resources received free of charge

1.2D: Revenue from Government Appropriations Departmental appropriations 17,539 17,938

Total revenue from Government 17,539 17,938

Accounting Policy

Revenue from Government

1.2B: Rental Income

Resources received free of charge are recognised as revenue when, and only when, a fair value can be reliably determined and the services would have been purchased if they had not been donated. Use of those resources is recognised as an expense. Resources received free of charge are recorded as either revenue or gains depending on their nature.

Amounts appropriated for departmental appropriations for the year (adjusted for any formal additions and reductions) are recognised as Revenue from Government when TEQSA gains control of the appropriation, except for certain amounts that relate to activities that are reciprocal in nature, in which case revenue is recognised only when it has been earned. Appropriations receivable are recognised at their nominal amounts.

Total rental income Subleasing right-of-use assets

Subleasing right-of-use assets TEQSA in its capacity as lessor sublets office accommodation. The sublease commenced on 21 September 2015 and expires on 28 February 2022.

Lease receipts are subject to a fixed percentage annual increase in accordance with the sublease agreement.

Maturity analysis of subleasing receivables:

The above lease disclosures should be read in conjunction with the accompanying notes 1.1B, 1.1C, 3.2A and 3.3C.

TEQSA | Annual Report 2019-20 91

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

2020 2019

$'000 $'000

Revenue

Non-Taxation Revenue

2.2A: Fees Fees from regulatory services 1,182 1,969

Total fees 1,182 1,969

Accounting Policy

Higher Education Relief Package In response to the COVID-19 pandemic, the Australian Government have implemented a range of relief measures to lift the financial pressures on higher education providers. The measures include:

● waiver of fees and charges for eligible providers that have been invoiced since 1 January 2020, through to 30 June 2021; and

Administered revenue reported for the period is net of refunds made during the year and refunds payable at 30 June 2020.

● refund of eligible payments received since 1 January 2020.

All administered revenues are revenues relating to ordinary activities performed by TEQSA on behalf of the Australian Government.

Revenue is generated from partial cost recovery arrangements for specific services to higher education providers. Fees are charged on registration and re-registration of providers, accreditation and re-accreditation of courses, and major variations to registrations and accreditations. Administered revenue is recognised on receipt of applications from the higher education providers.

2.2 Administered - Income

For the year ended 30 June 2020, no administered expenses had been incurred by TEQSA (2019: Nil).

2. Income and Expenses Administered on behalf of Government This section analyses the activities that the Tertiary Education Quality and Standards Agency does not control but administers on behalf of the Government. Unless otherwise noted, the accounting policies adopted are consistent with those applied for departmental reporting.

2.1 Administered - Expenses

92 Section 5 | FINANCIAL REPORT

3.1 Financial Assets

2020 $'000

3.1A: Cash and Cash Equivalents Cash at bank 207

Cash - third party accounts -

Total cash and cash equivalents 207

Accounting Policy

3.1B: Trade and Other Receivables Goods and services receivables Goods and services 32

Total goods and services receivables 32

Appropriations receivables Appropriation receivable 8,062

Total appropriations receivables 8,062

Other receivables GST receivable from the Australian Taxation Office 183

Sublease incentive 45

Operating sublease receivable 68

Other 12

Total other receivables 308

Total trade and other receivables (net) 8,402

Credit terms for goods and services were within 30 days (2019: 30 days).

Accounting Policy

Trade receivables, loans and other receivables that are held for the purpose of collecting the contractual cash flows where the cash flows are solely payments of principal and interest, that are not provided at below-market interest rates, are subsequently measured at amortised cost using the effective interest method adjusted for any loss allowance.

Cash and cash equivalents

Cash is recognised at its nominal amount. Cash and cash equivalents include cash on hand and deposits in bank accounts.

21 21

9,497 9,497

204 73

This section analyses the Tertiary Education Quality and Standards Agency assets used to conduct its operations and the operating liabilities incurred as a result. Employee related information is disclosed in the People and Relationships section.

3. Financial Position

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS Tertiary Education Quality and Standards Agency

Financial assets

99 19 395

9,913

2019 $'000

174 115 289

TEQSA | Annual Report 2019-20 93

3.2 Non-Financial Assets

Buildings1

Plant and Equipment

Intangibles -Computer Software2

Total

$’000 $’000 $’000 $’000

As at 1 July 2019

Gross book value 618 482 3,426 4,526

Accumulated depreciation, amortisation and impairment

- (57) (2,428) (2,485)

Total as at 1 July 2019 618 425 998 2,041

3,591 - - 3,591

Adjusted total as at 1 July 2019 4,209 425 998 5,632

Additions Purchase 144 72 - 216

Internally developed - - 680 680

Depreciation and amortisation (1,765) (194) (379) (2,338)

Total as at 30 June 2020 2,588 303 1,299 4,190

Total as at 30 June 2020 represented by Gross book value 4,353 554 4,106 9,013

Accumulated depreciation, amortisation and impairment (1,765) (251) (2,807) (4,823)

Total as at 30 June 2020 2,588 303 1,299 4,190

Carrying amount of right-of-use assets 2,083 - - 2,083

All items of plant and equipment and intangible assets were assessed for indications of impairment as at 30 June 2020. No indicators of impairment were found.

No property, plant and equipment or intangibles are expected to be sold or disposed of within the next 12 months.

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

3.2A: Reconciliation of the Opening & Closing Balances of Property, Plant & Equipment and Intangibles

Recognition of right-of-use asset on initial application of AASB 16

2

The carrying amount of computer software includes $17,426 of purchased software and $1,281,031 of internally generated software.

1 Buildings include leasehold improvements and lease right-of-use assets.

94 Section 5 | FINANCIAL REPORT

Accounting Policy

Asset Recognition Threshold

Lease right-of-use (ROU) Assets

Revaluations

TEQSA's leasehold improvements and property, plant and equipment are stated at their revalued amounts, being the fair value at the date of revaluation, less any subsequent accumulated depreciation. The fair value measurements of TEQSA's leasehold improvements and plant and equipment was last performed by Jones Lang LaSalle (JLL) in the 2018-19 financial year. JLL have appropriate experience in the fair value measurement of similar assets in the Government sector.

Assets are recorded at cost on acquisition except as stated below. The cost of acquisition includes the fair value of assets transferred in exchange and liabilities undertaken. Financial assets are initially measured at their fair value plus transaction costs where appropriate. Assets acquired at no cost, or for nominal consideration, are initially recognised as assets and income at their fair value at the date of acquisition.

Revaluation adjustments are made on a class basis. Any revaluation increment is credited to equity under the heading of asset revaluation reserve except to the extent that it reversed a previous revaluation decrement of the same asset class that was previously recognised in the surplus/deficit. Revaluation decrements for a class of assets are recognised directly in the surplus/deficit except to the extent that they reverse a previous revaluation increment for that class. Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset, and the asset is restated to the revalued amount.

Leased ROU assets are capitalised at the commencement date of the lease and comprise of the initial lease liability amount, initial direct costs incurred when entering into the lease less any lease incentives received. These assets are accounted for by Commonwealth lessees as separate asset classes to corresponding assets owned outright, but included in the same column as where the corresponding underlying assets would be presented if they were owned.

On initial adoption of AASB 16, TEQSA has adjusted the ROU assets at the date of initial application by the amount of any provision for onerous leases recognised immediately before the date of initial application. Following initial application, an impairment review is undertaken for any right of use lease asset that shows indicators of impairment and an impairment loss is recognised against any right of use lease asset that is impaired. Lease ROU assets continue to be measured at cost after initial recognition in Commonwealth agency, GGS and Whole of Government financial statements.

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS Tertiary Education Quality and Standards Agency

Purchases of property, plant and equipment are recognised initially at cost in the Statement of Financial Position, except for purchases costing less than $2,000 which are expensed in the year of acquisition (other than where they form part of a group of similar items which are significant in total).

The initial cost of an asset includes an estimate of the cost of dismantling and removing the item and restoring the site on which it is located. This is particularly relevant to ‘make good’ provisions in property leases taken up by TEQSA where there exists an obligation to restore the property to its original condition. These costs are included in the value of TEQSA's leasehold improvements with a corresponding provision for the ‘make good’ recognised.

Following initial recognition at cost, property, plant and equipment (excluding ROU assets) are carried at fair value (or an amount not materially different from fair value) less subsequent accumulated depreciation and accumulated impairment losses. Valuations are conducted with sufficient frequency to ensure that the carrying amounts of assets did not differ materially from the assets’ fair values as at the reporting date. The regularity of independent valuations depended upon the volatility of movements in market values for the relevant assets.

TEQSA | Annual Report 2019-20 95

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS Tertiary Education Quality and Standards Agency

Accounting Policy (continued)

Depreciation

Asset Class 2020

Buildings Lease term

Plant and equipment 3 to 10 years

Impairment

Fair Value

Derecognition

Intangibles

Accounting Judgements and Estimates

The future economic benefits of TEQSA's leasehold improvements and property, plant and equipment are not primarily dependent on their ability to generate cash flows. TEQSA has not disclosed quantitative information about the significant unobservable inputs for the levels 2 and 3 measurements in these classes.

Lease term 3 to 10 years

All software assets were assessed for indications of impairment as at 30 June 2020.

The estimated fair value of leasehold improvements, plant and equipment was last determined by an independent valuer in 2019, and is subject to management assessment on an annual basis.

All assets were assessed for impairment at 30 June 2020. Where indications of impairment exist, the asset’s recoverable amount is estimated and an impairment adjustment made if the asset’s recoverable amount is less than its carrying amount.

The recoverable amount of an asset is the higher of its fair value less costs of disposal and its value in use. Value in use is the present value of the future cash flows expected to be derived from the asset. Where the future economic benefit of an asset is not primarily dependent on the asset’s ability to generate future cash flows, and the asset would

be replaced if TEQSA were deprived of the asset, its value in use is taken to be its depreciated replacement cost.

Leasehold improvements and plant and equipment are measured at their estimated fair value in the Statement of Financial Position. Leasehold improvements and plant and equipment held by TEQSA are categorised under Levels 3 and 2 respectively, in accordance with the hierarchies listed in AASB 13. TEQSA's policy is to recognise transfers into and out of the fair value hierarchy levels as at the end of the reporting period.

Level 2 measurements use inputs other than quoted or market prices that are observable for the asset directly or indirectly. Level 3 measurements use inputs to estimate fair value where there are no observable market prices for the assets being valued.

An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.

TEQSA's intangibles comprise of internally developed software for internal use. These assets are carried at cost less accumulated amortisation and accumulated impairment losses. Software is amortised on a straight-line basis over its anticipated useful life. The useful lives of TEQSA's software are 3 to 5 years (2019: 3 to 5 years).

The depreciation rates for ROU assets are based on the commencement date to the earlier of the end of the useful life of the ROU asset or the end of the lease term.

Depreciable property, plant and equipment assets are written-off to their estimated residual values over their estimated useful lives to the entity using, in all cases, the straight-line method of depreciation. The estimated useful lives, residual values and depreciation methods are reviewed at each reporting date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate.

2019

Depreciation rates applying to each class of depreciable asset are based on the following useful lives:

96 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

2020 2019

$'000 $'000

3.2B: Other Non-Financial Assets Property operating prepayments1 36 178

Goods and services prepayments 122 124

Total other non-financial assets 158 302

No indicators of impairment were found for other non-financial assets.

Accounting Policy

Other non-financial assets

Other non-financial assets consist of prepayments which are expected to be consumed within the next 12 months. Property operating prepayments consists of amounts that are outside the scope of AASB 16.

1

TEQSA has applied AASB 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under AASB 117.

TEQSA | Annual Report 2019-20 97

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

3.3 Payables

2020 2019

$'000 $'000

3.3A: Suppliers Trade creditors and accruals 622 628

Total suppliers 622 628

Settlement is usually made within 20 days (2019: 30 days).

3.3B: Other Payables Salaries and wages 147 75

Superannuation 20 10

Lease incentive1 - 483

Operating lease payable1 - 480

Unearned income - 115

Other - 1

Total other payables 167 1,164

Accounting Policy

3.3C: Leases Lease liabilities 2,231 -

Total leases 2,231 -

Accounting Policy

The cash outflow for leases for the year ended 30 June 2020 was $1,557,147.

Refer to Overview section for accounting policy on leases.

Accounting policies for payables is contained in the Managing Uncertainties section.

1

TEQSA has applied AASB 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under AASB 117.

TEQSA has applied AASB 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under AASB 117.

98 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

3.4 Other Provisions

3.4A: Other Provisions

Provision for restoration1

Provision for onerous contracts2

$’000 $’000

As at 1 July 2019 527 298

Additional provisions made - - -

Amounts used - - -

Amounts reversed - - -

Unwinding of discount or change in discount rate 11 -

AASB 16 transition - adjustment against ROU asset2 - (298)

Total as at 30 June 2020 538 -

1

TEQSA currently has 1 (2019: 1) agreement for the leasing of office space which requires the premises to be restored to their original condition at the conclusion of the lease. TEQSA has made a provision to reflect the present value of this obligation.

11

538

2

At 1 July 2019, TEQSA had one sublease agreement whereby the economic benefit of the rental income derived is less than the operating lease expense incurred. At transition to AASB 16, the balance of the provision has been adjusted against the ROU asset in accordance with the modified retrospective approach.

(298)

Total

$’000

825

TEQSA | Annual Report 2019-20 99

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

2020 2019

$'000 $'000

4.2A: Suppliers Refund liabilities 52 -

Total suppliers 52 -

Settlement is usually made within 20 days (2019: 30 days).

The refund liability at 30 June 2020 represent amounts owed to eligible providers under the Higher Education Relief Package in response to the COVID-19 pandemic.

4. Assets and Liabilities Administered on behalf of Government This section analyses assets used to conduct operations and the operating liabilities incurred which the Tertiary Education Quality and Standards Agency does not control but administers on behalf of the Government. Unless otherwise noted, the accounting policies adopted are consistent with those applied for departmental reporting.

4.1 Administered - Assets

As at 30 June 2020, TEQSA held no administered assets (2019: Nil).

4.2 Administered - Liabilities

100 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

5. Funding

This section identifies the Tertiary Education Quality and Standards Agency funding structure.

5.1 Appropriations

5.1A: Annual Appropriations ('Recoverable GST exclusive')

Annual Appropriations for 2020

$'000 $'000 $'000 $'000 $'000

Departmental

Ordinary annual services 17,539 1,738 19,277 20,202 (925)

Capital Budget4 846 - 846 737 109

Other services - - - - -

Equity Injections - - - - -

Total departmental 18,385 1,738 20,123 20,939 (816)

Annual Appropriations for 2019

$'000 $'000 $'000 $'000 $'000

Departmental

17,938 1,360 19,298 17,266 2,032

Capital Budget4 1,646 - 1,646 411 1,235

Other services - - - - -

Equity Injections - - - - -

Total departmental 19,584 1,360 20,944 17,677 3,267

Annual

Appropriation1 Adjustments to appropriation2

Total

appropriation

Appropriation applied in 2020 (current and prior years)

Variance3

1

In 2019-20, there were no appropriations which have been withheld (Section 51 of the PGPA Act) and quarantined for administration purposes. 2 In 2019-20, adjustments to appropriation comprises of $1.738 million of PGPA Act Section 74 receipts. 3

In 2019-20, the variance between total appropriation and appropriation applied in 2020 for ordinary annual services relates to payments funded from unspent prior year appropriation items. 4 Departmental Capital Budgets are appropriated through Supply and Appropriation Acts (No.1,3,5). They form part of ordinary annual services, and are not separately identified in the Supply and Appropriation Acts.

Annual

Appropriation1 Adjustments to appropriation2

Total

appropriation

Appropriation applied in 2019 (current and prior years)

Variance3

Ordinary annual services

1

In 2018-19, there were no appropriations which have been withheld (Section 51 of the PGPA Act) and quarantined for administration purposes. 2 In 2018-19, adjustments to appropriation comprises of $1.360 million of PGPA Act Section 74 receipts. 3

In 2018-19, the variance between total appropriation and appropriation applied in 2019 for ordinary annual services relates to payments funded from unspent prior year appropriation items. 4

Departmental and Administered Capital Budgets are appropriated through Appropriation Acts (No.1,3,5). They form part of ordinary annual services, and are not separately identified in the Appropriation Acts.

TEQSA | Annual Report 2019-20 101

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

2020 2019

$'000 $'000

5.1B: Unspent Annual Appropriations ('Recoverable GST exclusive') Departmental Appropriation Act (No. 1) - Capital Budget (DCB) 2016-171 - 504

Supply Act (No. 1) - Capital Budget (DCB) 2016-171 - 115

Appropriation Act (No. 1) - Capital Budget (DCB) 2017-18 - 440

Appropriation Act (No. 2) - Equity Injection 2017-18 - 100

Appropriation Act (No. 1) - Operating 2018-19 - 6,866

Appropriation Act (No. 1) - Capital Budget (DCB) 2018-19 1,449 1,646

Appropriation Act (No. 1) - Operating 2019-20 5,974 -

Supply Act (No. 1) - Capital Budget (DCB) 2019-20 353 -

Appropriation Act (No. 1) - Capital Budget (DCB) 2019-20 493 -

Total departmental 8,269 9,671

5.1C: Special Appropriations ('Recoverable GST exclusive')

Authority Type Purpose

2020 $'000

2019 $'000

Public Governance, Performance and Accountability Act 2013

Refund To provide for payments under s.77 of the PGPA Act. All transactions under this Act are recognised as Administered items.

677 6

Total special appropriations applied 677 6

5.2 Regulatory Charging Summary

2020 2019

$'000 $'000

Amounts applied Departmental Annual appropriations 18,525 17,174

Total amounts applied 18,525 17,174

Expenses Departmental 16,886 16,408

Total expenses 16,886 16,408

External revenue Administered 1,182 1,969

Total external revenue 1,182 1,969

Regulatory charging activities:

1

Funding from budget year 2016-17 lapsed on 1 July 2019 with the repeal of Supply Act (No. 1) 2016-17 and Appropriation Act (No. 1) 2016-17.

Appropriation Applied

TEQSA has in place partial regulatory charging for specified services to higher education providers including: registration and re-registration of providers; accreditation and re-accreditation of courses; and major variations to registrations and accreditations.

All fee revenue from regulatory charging activities is administered revenue and is returned to the Consolidated Revenue Fund. TEQSA does not have any administered expenses.

Documentation (Cost Recovery Implementation Statement) for the above activities is available at https://www.teqsa.gov.au/fees.

102 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

6. People and Relationships

6.1 Employee Provisions

2020 2019

$'000 $'000

6.1: Employee Provisions Leave 2,484 2,060

Total employee provisions 2,484 2,060

Accounting Policy

Leave

Superannuation

This section describes a range of employment and post employment benefits provided to our people and our relationships with other key people.

Liabilities for short-term employee benefits and termination benefits expected within twelve months of the end of reporting period are measured at their nominal amounts. Other long-term employee benefits are measured as net total of the present value of the defined benefit obligation at the end of the reporting period minus the fair value at the end of the reporting period of plan assets (if any) out of which the obligations are to be settled directly.

The liability for employee benefits includes provision for annual leave and long service leave. The leave liabilities are calculated on the basis of employees’ remuneration at the estimated salary rates that will be applied at the time the leave is taken, including the entity’s employer superannuation contribution rates to the extent that the leave is

likely to be taken during service rather than paid out on termination.

The liability for long service leave has been determined by reference to the Public Governance, Performance and Accountability (Financial Reporting) Rule 2015 (FRR) 24.1(a) using the shorthand method. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.

TEQSA's staff are members of the Public Sector Superannuation Scheme (PSS), the PSS accumulation plan (PSSap), or other superannuation funds held outside the Australian Government. The PSS is a defined benefit schemes for the Australian Government. The PSSap is a defined contribution scheme.

The liability for defined benefits is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course. This liability is reported in the Department of Finance’s administered schedules and notes.

TEQSA makes employer contributions to the employees' defined benefit superannuation scheme at rates determined by an actuary to be sufficient to meet the current cost to the Government, and accounts for the contributions as if they were contributions to defined contribution plans. The liability for superannuation recognised as at 30 June represents outstanding contributions.

TEQSA | Annual Report 2019-20 103

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

6.2 Key Management Personnel Remuneration

2020 2019

$'000 $'000

Short-term employee benefits 903 917

Post-employment benefits 53 48

Other long-term employee benefits 19 14

Total key management personnel remuneration expenses1 975 979

6.3 Related Party Disclosures

Related party relationships:

TEQSA is an Australian Government controlled entity. Related parties to TEQSA are those identified as Key Management Personnel including the Portfolio Minister.

Transactions with related parties:

Given the breadth of Government activities, related parties may transact with the government sector in the same capacity as ordinary citizens. These transactions have not been separately disclosed in this note.

The total number of key management personnel that are included in the above table is 6 (2019: 5).

Key Management Personnel (KMP) are those persons having authority and responsibility for planning, directing and controlling the activities of TEQSA, directly or indirectly, including any director (whether executive or otherwise) of TEQSA.

TEQSA has determined KMP to be the Chief Commissioner, Commissioners and the Chief Executive Officer. KMP remuneration is reported in the table below:

The following transactions with parties related to KMP occurred during the financial year: ● Anthony McClaran (Chief Executive Officer) was a member of the Audit Committee Member of the Australian Accounting Standards Board (AASB) during the reporting period. TEQSA subleases office space to AASB under a MOU arrangement. The value of the transaction for the 2019-20 financial year is $269,004 (2019: $265,887).

None of the above KMP played any role in Agency decisions in relation to their related party transactions noted above.

1

The above KMP remuneration excludes the remuneration and other benefits of the Portfolio Minister. The Portfolio Minister's remuneration and other benefits are set by the Remuneration Tribunal and are not paid by TEQSA.

104 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

7. Managing Uncertainties

7.1 Contingent Assets and Liabilities

7.1A: Contingent Assets and Liabilities

TEQSA had no departmental contingent assets or liabilities at 30 June 2020 (2019: Nil).

7.1B: Administered - Contingent Assets and Liabilities

TEQSA had no administered contingent assets or liabilities at 30 June 2020 (2019: Nil).

7.2 Financial Instruments

2020 2019

$'000 $'000

7.2A: Categories of Financial Instruments

Financial Assets Financial assets at amortised cost Cash and cash equivalents 207 289

Trade and other receivables - goods and services 44 40

Total financial assets at amortised cost 251 329

Total financial assets 251 329

Financial Liabilities Financial liabilities measured at amortised cost Trade creditors and accruals 622 628

Total financial liabilities measured at amortised cost 622 628

Total financial liabilities 622 628

This section analyses how the Tertiary Education Quality and Standards Agency manages financial risks within its operating environment.

TEQSA | Annual Report 2019-20 105

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

7.2A: Categories of Financial Instruments - continued

Accounting Policy

Financial assets

● financial assets measured at amortised cost.

Financial Assets at Amortised Cost

Financial assets included in this category need to meet two criteria:

(1) the financial asset is held in order to collect the contractual cash flows; and

Amortised cost is determined using effective interest method.

Effective Interest Method

Impairment of Financial Assets

Financial liabilities

Financial Liabilities at Amortised Cost

With the implementation of AASB 9 Financial Instruments for the first time in 2019, TEQSA classifies its financial assets in the following category:

A write-off constitutes a derecognition event where the write-off directly reduces the gross carrying amount of the financial asset.

(2) the cash flows are solely payments of principal and interest (SPPI) on the principal outstanding amount.

Income is recognised on an effective interest rate basis for financial assets that are recognised at amortised cost.

Financial liabilities are classified as either financial liabilities 'at fair value through profit or loss' or other financial liabilities. Financial liabilities are recognised and derecognised upon ‘trade date’.

Financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs. These liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective interest basis.

Supplier and other payables are recognised at amortised cost. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced).

The classification depends on both TEQSA's business model for managing the financial assets and contractual cash flow characteristics at the time of initial recognition. Financial assets are recognised and derecognised upon trade date. Comparatives have not been restated on initial application.

Financial assets are assessed for impairment at the end of each reporting period based on Expected Credit Losses, using the general approach which measures the loss allowance based on an amount equal to lifetime expected credit losses where risk has significantly increased, or an amount equal to 12-month expected credit losses if risk has not increased.

The simplified approach for trade, contract and lease receivables is used. This approach always measures the loss allowance as the amount equal to the lifetime expected credit losses.

106 Section 5 | FINANCIAL REPORT

Tertiary Education Quality and Standards Agency NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

8. Other Information 8.1 Aggregate Assets and Liabilities

2020 2019

$'000 $'000

8.1A: Aggregate Assets and Liabilities Assets expected to be recovered in: No more than 12 months 8,654 8,686

More than 12 months 4,303 3,859

Total assets 12,957 12,545

Liabilities expected to be settled in: No more than 12 months 2,572 2,321

More than 12 months 3,470 2,356

Total liabilities 6,042 4,677

8.1B: Administered - Aggregate Assets and Liabilities Assets expected to be recovered in: No more than 12 months - -

More than 12 months - -

Total assets - -

Liabilities expected to be settled in: No more than 12 months (52) -

More than 12 months - -

Total liabilities (52) -

Appendices 6

Appendix A: Legislative framework

Appendix B: Summary of resources

Appendix C: Staffing profile

Appendix D: Freedom of information

Appendix E: Ecologically-sustainable development and environmental performance

Appendix F: Advertising and market research

Appendix G: Workplace health and safety

Appendix H: Complaints handling

Appendix I: Disability reporting

Appendix J: Corrections to previous annual report

108 Section 6 | APPENDICES

Section 6: Appendices

Appendix A: Legislative framework The TEQSA Act is the primary basis of TEQSA’s powers. The objects of the Act are to:

> provide for national consistency in the regulation of higher education

> regulate higher education using a standards-based quality framework and principles relating to regulatory necessity, risk and proportionality

> protect and enhance Australia’s reputation for quality higher education, the international competitiveness of Australia’s higher education sector, as well as excellence, diversity and innovation in higher education

> encourage and promote a higher education system that is appropriate to meet Australia’s social and economic needs for a highly educated and skilled population

> protect students undertaking, or proposing to undertake higher education in Australia, by requiring the provision of quality higher education

> ensure that students have access to information relating to higher education in Australia.

TEQSA assures the quality of registered higher education providers through nationally consistent regulation and meets the objects of the TEQSA Act through performing functions including:

> registering providers and accrediting courses of study in accordance with the TEQSA Act

> investigating whether the TEQSA Act has been or is being complied with, including by conducting compliance assessments

> collecting, analysing, interpreting and disseminating information relating to higher education providers, regulated higher education awards, quality assurance practice and improvement in higher education and the HES Framework

> cooperating with counterparts in other countries.

TEQSA | Annual Report 2019-20 109

The agency also has responsibility under the Education Services for Overseas Students Act 2000 (ESOS Act) to register providers of courses to overseas students, for the following providers:

> higher education providers registered under the TEQSA Act

> English Language Intensive Courses for Overseas Students (ELICOS) providers, if they have an entry arrangement with a registered higher education provider

> Foundation program providers.

TEQSA is also subject to several other acts and legislative instruments including (but not limited to) the:

> Public Governance, Performance and Accountability Act 2013 (PGPA Act)

> Public Service Act 1999

> Work Health and Safety Act 2011

> Safety, Rehabilitation and Compensation Act 1988

> Freedom of Information Act 1982.

110 Section 6 | APPENDICES

Appendix B: Summary of resources

Table B.1: Entity Resource Statement 2019-20

Actual available appropriation - current year (a)

Payments made (b)

Balance remaining (a)-(b)

$’000 $’000 $’000

Departmental

Annual appropriations -

ordinary annual services

29,075 20,806 8,269

Annual appropriations -

other services - non-operating

100 100 -

Total departmental annual appropriations 29,175 20,906 8,269

Departmental special appropriations - - -

Total special appropriations - - -

Special accounts - - -

Total special accounts - - -

less departmental appropriations drawn from

annual/special appropriations and credited to

special accounts

- - -

Total departmental resourcing (A) 29,175 20,906 8,269

Administered

Annual appropriations - ordinary annual services - - -

Annual appropriations - other services - non-operating - - -

Annual appropriations - other services - specific payments to States, ACT, NT and local government

- - -

Annual appropriations - other services - new administered expenses - - -

TEQSA | Annual Report 2019-20 111

Table B.1: Entity Resource Statement 2019-20 (continued)

Actual available appropriation - current year (a)

Payments made (b)

Balance remaining (a)-(b)

$’000 $’000 $’000

Total administered annual appropriations - - -

Administered special appropriations - - -

Total administered special appropriations - - -

Special accounts - - -

Total special accounts receipts - - -

less administered appropriations drawn from annual/special appropriations and credited to special accounts

- - -

less payments to corporate entities from annual/

special appropriations

- 677 -

Total administered resourcing (B) - 677 -

Total resourcing and payments for entity X (A + B) 29,175 21,583 -

112 Section 6 | APPENDICES

Table B.2: Expenses for Outcome 1

Outcome 1: Contribute to a high quality

higher education sector through streamlined

and nationally consistent higher education

regulatory arrangements; registration of

higher education providers; accreditation of

higher education courses; and investigation,

quality assurance and dissemination

of higher education standards and

performance.

Budget

2019-20

$’000

Actual expenses

2019-20

$’000)

Variation

2019-20

$’000

Program 1.1: Regulation and Quality Assurance

Departmental expenses

Departmental appropriation 17,803 18,343 (540)

Expenses not requiring appropriation in the budget year 842 2,410 (1,568)

Total for Program 1.1 18,645 20,753 (2,108)

Outcome 1 totals by appropriation type

Departmental expenses

Departmental appropriation 17,803 18,343 (540)

Expenses not requiring appropriation in the budget year 842 2,410 (1,568)

Total expenses for Outcome 1 18,645 20,753 (2,108)

Budget

2019-20

Actual

2019-20

Average staffing level (number) 95 82 13

TEQSA | Annual Report 2019-20 113

Appendix C: Staffing profile As at 30 June 2020, TEQSA employed 56 APS and 33 executive-level staff, including one SES officer and four Office Holders. All roles were based in Victoria.

Table C.1: Employment type by classification and gender, 2019-20

Classification Female Male Grand

total

Ongoing Non-

ongoing Ongoing Non-

ongoing

SES 1 Full-time 1 - - - 1

Part-time - - - - -

EL2 Full-time 3 - 4 - 7

Part-time - - - - -

EL1 Full-time 12 1 7 - 20

Part-time 1 - - - 1

APS6 Full-time 27 - 7 2 36

Part-time 5 - - - 5

APS5 Full-time 3 - 5 1 9

Part-time 2 - - - 2

APS4 Full-time 1 2 - - 3

Part-time 1 - - - 1

Other Full-time - - - 1 1

Part-time - 1 - 2 3

TOTALS 56 4 23 6 89

As at 30 June 2019, TEQSA employed 53 APS and 30 executive-level staff. All roles were based in Victoria.

114 Section 6 | APPENDICES

Table C.2: Employment type by classification and gender, 2018-19

Classification Female Male Grand

total

Ongoing Non-

ongoing Ongoing Non-

ongoing

SES 1 Full-time 1 - - - 1

Part-time - - - - -

EL2 Full-time 1 - 5 6

Part-time - - - 1 1

EL1 Full-time 11 - 4 1 16

Part-time 1 - - - 1

APS6 Full-time 25 1 7 1 34

Part-time 6 - - - 6

APS5 Full-time 6 - 3 - 9

Part-time 1 - 1 - 2

APS4 Full-time 1 - - - 1

Part-time 1 - - - 1

Other Full-time - - - 1 1

Part-time - 2 - 2 4

TOTALS 54 3 20 6 83

TEQSA | Annual Report 2019-20 115

Table C.3: Ongoing and non-ongoing Aboriginal and Torres Strait Islander staff, at 30 June 2019 and 30 June 2020

2018-19 2019-20

Ongoing 1 1

Non-Ongoing - -

Total 1 1

Table C.4: Employment arrangements for SES and non-SES staff, 2019-20

SES Non-SES Total

Section 24(1) determinations 1 - 1

S138 TEQSA Act - 4 4

ss154C(1) TEQSA Act - - -

Individual Flexibility Arrangement - 7 7

Enterprise Arrangement - 77 77

Total 1 88 89

116 Section 6 | APPENDICES

Table C.5: Salary ranges by employment classification, 2019-20

Minimum Salary Maximum Salary

EL 2 $123,142 $147,817

EL 1 $104,645 $115,657

APS 6 $85,102 $93,583

APS 5 $75,699 $80,928

APS 4 $68,556 $73,322

APS 3 $63,028 $65,649

APS 2 $56,437 $60,141

APS 1 $48,051 $52,539

Other $28,830 $43,728

Minimum/Maximum range

$28,830 $147,817

TEQSA | Annual Report 2019-20 117

Table C.6: Information about

remuneration for key management personnel

Name and position title

Short-term benefits

Post-employment benefits

Other long-term

benefits

Termination benefits

Total

remuneration

Base

salary

Bonuses

Other benefits

and

allowances

Superannuation contributions

Long service leave

Other long- term benefits

Professor

Nicholas

Saunders,

Chief Commissioner

1

and Acting Chief Executive Officer

2

$274,362

$-

$-

$22,499

$777

$-

$-

$297,638

Professor

Cliff Walsh

Commissioner

1

$121,045

$-

$-

$11,499

$-

$-

$-

$132,544

Dr Linley Martin Commissioner

1

$75,508

$-

$-

$7,173

$-

$-

$-

$82,681

Professor Joan Cooper Commissioner

1

$125,618

$-

$-

$11,934

$-

$-

$-

$137,552

Professor

Peter

Coaldrake Commissioner

1

$6,658

$-

$-

$632

$-

$-

$-

$7,290

Mr Anthony McClaran

3, Chief

Executive Officer

$299,569

$-

$-

$-

$17,881

$-

$-

$317,450

1. No leave entitlements are paid or accrued for the

Chief Commissioner and

Commissioners

2. Commenced acting CEO arrangements effective 26 March 2020 3. No super contributions have been made as amounts are taken up as salary The above table is prepared on an accruals basis.

118 Section 6 | APPENDICES

Table C.7: Information about

remuneration for senior executives

Short-term benefits

Post-employment benefits

Other long-term

benefits

Termination benefits

Total

remuneration

Total

remuneration

bands

Number of senior executives

Average base

salary

Average bonuses

Average other benefits

and

allowances

Average

superannuation contributions

Average long service leave

Average other long- term benefits

Average termination benefits

Average total

remuneration

$245,001 - $265,000

1

$220,171

$-

$-

$30,650

$5,704

$-

$-

$256,525

Table C.8: Information about

remuneration for other highly paid

staff

Short-term benefits

Post-employment benefits

Other long-term

benefits

Termination benefits

Total

remuneration

Total

remuneration

bands

Number of other highly paid

staff

Average base

salary

Average bonuses

Average other benefits

and

allowances

Average

superannuation contributions

Average long service leave

Average other long- term benefits

Average termination benefits

Average total

remuneration

$225,001 - $245,000

1

$190,087

$-

$-

$34,544

$5,429

$-

$-

$230,060

TEQSA | Annual Report 2019-20 119

Appendix D: Freedom of Information Entities subject to the Freedom of Information Act 1982 (FOI Act) are required to publish information as part of the Information Publication Scheme (IPS). This requirement appears in Part II of the FOI Act and has replaced the former requirement to publish a section 8 statement in an annual report. Each agency must display a plan on its website showing what information it publishes in accordance with the IPS requirements.

In accordance with these IPS requirements, an agency plan indicating published information is accessible from TEQSA’s website at www.teqsa.gov.au/information-publication-scheme.

Appendix E: Ecologically-sustainable development and environmental performance The information provided is in accordance with section 516A of the Environment Protection and Biodiversity Conservation Act 1999. TEQSA is committed to progressing towards a sustainable future and continued improvement in reducing negative impacts on the environment.

In 2019-20, TEQSA complied with environmental initiatives, participating in recycling initiatives offered by the 530 Collins Street building management. This comprises paper, cardboard, co-mingled organic matter and hard waste recycling; e-waste recycling; and battery recycling. TEQSA is committed to reducing contamination of waste streams and reducing its general waste stream.

TEQSA also continued its commitments to other recycling initiatives not provided by building management, including printer toner and waste cartridge recycling.

Appendix F: Advertising and market research TEQSA did not conduct any advertising campaigns during 2019-20.

Appendix G: Workplace health and safety TEQSA is committed to safeguarding the health, safety and welfare of staff and visitors and to preventing occupational injury. TEQSA has a Workplace Health and Safety (WHS) Committee that includes representatives from management and staff. TEQSA provides staff with access to an Employee Assistance Program and annual flu vaccinations.

No reportable WHS incidents occurred during 2019-20 and TEQSA was not required to give any notices under the Work Health and Safety Act 2011.

120 Section 6 | APPENDICES

Appendix H: Complaints handling

Complaints about TEQSA In 2019-20, TEQSA received six complaints about TEQSA. The main theme in these complaints related to TEQSA’s responsiveness in its dealings with stakeholders (including the time taken to respond to complaints about a provider).

TEQSA’s complaints page (available at www.teqsa.gov.au/complaints-about-teqsa) and public interest disclosure page (available at www.teqsa.gov.au/public-interest-disclosure) also provide information about complaints about TEQSA.

Concerns about higher education providers TEQSA monitors concerns about higher education providers. The concerns page on TEQSA’s website www.teqsa.gov.au/concerns provides information for the public on options for raising a concern with TEQSA about a registered higher education provider. This website includes an explanation of matters that are of interest to TEQSA and links to other Commonwealth and state and territory agencies.

Refer to Section 3 Action 1.4: Enhance TEQSA’s approach to monitoring, assessment and management of risks for information about the work undertaken by TEQSA on concerns about providers in 2019-20.

Appendix I: Disability reporting The National Disability Strategy 2010-2020 sets out a 10-year national policy framework for improving the lives of people with disability, promoting participation and creating a more inclusive society. A key initiative of the strategy is the introduction of a periodic high-level report tracking progress against each of the six outcome areas of the strategy for people with disability in Australia. The reports use trend data based on the six outcome areas of the strategy, and are available on the Department of Social Services website.

Appendix J: Corrections to previous annual report

Section 3: Performance review Page 29 — The meetings with the high risk providers were informed by the 2017 Cycle 5 risk assessments results and the preliminary results of the 2018 Cycle 6 risk assessments. These meetings were completed by June 2018. TEQSA’s oversight of the providers’ action plans continued into 2018-19.

TEQSA | Annual Report 2019-20 121

Section 6: Appendices Page 104 — 2018-19 employment figures listed in Table C.1: Employment type by classification and gender, 2018 -19 have been updated.

Classification Female Male Grand

total

Ongoing Non-

ongoing Ongoing Non-

ongoing

SES 1 Full-time 1 - - - 1

Part-time - - - - -

EL2 Full-time 1 - 5 - 6

Part-time - - - 1 1

EL1 Full-time 11 - 4 1 16

Part-time 1 - - - 1

APS6 Full-time 25 1 7 1 34

Part-time 6 - - - 6

APS5 Full-time 6 - 3 - 9

Part-time 1 - 1 - 2

APS4 Full-time 1 - - - 1

Part-time 1 - - - 1

Other Full-time - - - 1 1

Part-time - 2 - 2 4

TOTALS 54 3 20 6 83

122 Section 6 | APPENDICES

Page 105 — 2017-18 employment figures listed in Table C.2: Employment type by classification and gender, 2017 -18 have been updated.

Classification Female Male Grand

total

Ongoing Non-

ongoing Ongoing Non-

ongoing

SES 1 Full-time - - - - -

Part-time - - - - -

EL2 Full-time 1 - 4 - 5

Part-time - - - - -

EL1 Full-time 8 - 8 - 16

Part-time 1 - - - 1

APS6 Full-time 16 - 3 - 19

Part-time 3 - 1 - 4

APS5 Full-time 4 - - - 4

Part-time 2 - - - 2

APS4 Full-time - - 1 1 2

Part-time - - - - -

Other Full-time - - - - -

Part-time - - - - -

TOTALS 35 - 17 1 53

Indices and references

7Acronyms and abbreviationsGlossary of termsCompliance indexAlphabetical index

124 Section 7 | INDICES AND REFERENCES

Section 7: Indices and references

Acronyms and abbreviations

APS Australian Public Service

AQF Australian Qualifications Framework

ASL Average Staff Level

ASQA Australian Skills Quality Authority

CEO Chief Executive Officer

CRICOS Commonwealth Register of Institutions and Courses for Overseas Students

ELICOS English Language Intensive Courses For Overseas Students

ESOS Education Services for Overseas Students

ESOS Act Education Services for Overseas Students Act 2000

FOI Act Freedom of Information Act 1982

HEIMS Higher Education Information Management System

HES Framework Higher Education Standards Framework (Threshold Standards) 2015

HESP Higher Education Standards Panel

IPS Information Publication Scheme

MoC Memorandum of Cooperation

MoU Memorandum of Understanding

PBS Portfolio Budget Statements

PGPA Act Public Governance, Performance and Accountability Act 2013

SAA Self-accrediting authority

SES Senior Executive Service

SME Small and Medium Enterprises

SMT Senior Management Team

TAFE Technical and Further Education

TEQSA Tertiary Education Quality and Standards Agency

TEQSA Act Tertiary Education Quality and Standards Agency Act 2011

WHS Workplace Health and Safety

TEQSA | Annual Report 2019-20 125

Glossary of terms

Australian Skills Quality Authority (ASQA) The Australian Skills Quality Authority (ASQA) is the national regulator for Australia’s vocational education and training sector. ASQA regulates courses and training providers to ensure nationally-approved quality standards are met.

Australian Qualifications Framework (AQF) The Australian Qualifications Framework (AQF) is Australia’s national policy for regulated qualifications. The AQF encompasses higher education, vocational education and training, and school education. It provides for national recognition and a consistent understanding of what defines each qualification type.

While TEQSA does not determine the content of the AQF, the agency has regard to the specifications and guidelines throughout the AQF. The HES Framework includes the requirement that the learning outcomes of all higher education qualifications at Levels 5-10 of the AQF must be consistent with the level of the course, which TEQSA will assess against the corresponding specifications for levels in the AQF. TEQSA will also take into consideration the relevant qualification type descriptors in the AQF.

Commonwealth Register of Institutions and Courses for Overseas Students (CRICOS) The Commonwealth Register of Institutions and Courses for Overseas Students (CRICOS) is the official Australian Government website that lists all Australian education providers offering courses to people studying in Australia on student visas and the courses offered. CRICOS is a searchable database managed by the Department of Education, Skills and Employment under the ESOS legislative framework. It provides details of Australian education institutions approved to recruit, enrol and deliver education and training services to overseas students and details of the courses that they deliver. TEQSA is responsible for assessing applications for inclusion on the CRICOS and for approving the registration of a provider on CRICOS. The database can be searched by course or provider name/number and can be accessed at cricos.education.gov.au.

Department of Education, Skills and Employment The Australian Government Department of Education, Skills and Employment is responsible for national policies and programs that help Australians to access quality early childhood education, school education, higher education, vocational education and training, international education and research. It is also responsible for national policies and programs that help Australians find and keep employment and work in safe, fair and productive workplaces.

126 Section 7 | INDICES AND REFERENCES

English Language Intensive Courses for Overseas Students (ELICOS) English Language Intensive Courses for Overseas Students are courses offered to students studying in Australia on student visas. ‘Intensive’ denotes full-time study comprising a minimum of 20 scheduled course contact hours per week of face-to-face classes of English language instruction.

Education Services for Overseas Students (ESOS) The Education Services for Overseas Students (ESOS) Act 2000 (ESOS Act) and the associated legislation form the legal framework governing delivery of education to overseas students studying in Australia on a student visa. The framework sets out clear roles and responsibilities for providers of education and training to international students and complements Australia’s student visa laws. On 29 January 2012, TEQSA assumed responsibility for regulating international education for higher education under the ESOS Act.

Higher education provider Higher education provider is defined in the TEQSA Act and means:

(a) a constitutional corporation that offers or confers a regulated higher education award, or

(b) a corporation that:

(i) offers or confers a regulated higher education award

(ii) is established by or under a law of the Commonwealth or a Territory, or

(c) a person who offers or confers a regulated higher education award for the completion of a course of study provided wholly or partly in a Territory.

Higher Education Standards Framework (HES Framework) The Higher Education Standards Framework (Threshold Standards) 2011 was made by the responsible Minister on the advice of the Department of Industry, Innovation, Science, Research and Tertiary Education and commenced on 5 January 2012. The Higher Education Standards Framework (Threshold Standards) 2015 was determined by the Minister for Education and Training on advice from the independent HESP and commenced on 1 January 2017.

The Higher Education Standards Framework (Threshold Standards) 2015 is available at: www.legislation.gov.au/Details/F2015L01639.

The Higher Education Standards Framework (Threshold Standards) 2011 is available at: www.legislation.gov.au/Details/F2013C00169.

TEQSA | Annual Report 2019-20 127

Higher Education Standards Panel (HESP) The Higher Education Standards Panel (HESP) is responsible for developing and monitoring the HES Framework. HESP members are appointed by the Minister, in consultation with the responsible Minister for Research. Since 1 January 2015, the HESP has been supported by the Department of Education, Skills and Employment.

Material change Under subsection 29(1) of the TEQSA Act, it is a condition of registration that TEQSA is notified of events that happen, or are likely to happen, that will either:

> significantly affect the provider’s ability to meet the Higher Education Standards Framework

> require updating the provider’s entry on the National Register of Higher Education Providers.

National Code of Practice for Providers of Education and Training to Overseas Students (National Code) The National Code provides nationally consistent standards for the conduct of registered providers and the registration of their courses. These standards set out specifications and procedures to ensure that registered providers of education and training courses can clearly understand and comply with their obligations under the National Code.

National Register of Higher Education Providers (National Register) The National Register was established and is maintained under section 198 of the TEQSA Act. The National Register is available at www.teqsa.gov.au/national-register.

Provider category Provider category relates to a category of provider as listed in the Criteria for Classification of Higher Education Providers, available in Part B of the HES Framework at www.legislation.gov.au/Details/F2015L01639.

Registered higher education provider This term refers to a higher education provider registered under Part 3 of the TEQSA Act and listed on the National Register under paragraph 198(1)(a) of the Act.

Risk assessment The term ‘risk assessment’ captures the overall process of risk identification, risk analysis and risk evaluation.

128 Section 7 | INDICES AND REFERENCES

Risk Assessment Framework TEQSA’s Risk Assessment Framework outlines TEQSA’s approach to undertaking structured risk assessments of registered higher education providers. Risk assessments play a key role in TEQSA’s risk-based quality assurance and regulation of the sector by helping to prioritise TEQSA’s regulatory focus.

More information about TEQSA’s Risk Assessment Framework is available at www. teqsa.gov.au/risk-assessment-framework.

Self-accrediting authority Registered higher education providers can apply for authority to accredit one or more of their own courses of study. The authority to self-accredit courses can be granted for all current and future courses, or for specific courses, fields of education and/or levels.

TEQSA case managers TEQSA case managers are assessment staff employed in the Assurance Group and Assessment and Investigations Group of TEQSA who manage activities relating to higher education providers, through communication and cooperation with provider contacts.

TEQSA stakeholder survey TEQSA undertakes an annual sector-wide survey to increase TEQSA’s accountability, better understand its impact on higher education providers, and improve its performance. TEQSA decided not to undertake a survey for 2019-20 due to the COVID-19 pandemic.

TEQSA | Annual Report 2019-20 129

Compliance index The Compliance index indicates the location of information provided in accordance with paragraph 17AJ(d) of the PGPA Act. References in the first column of the Compliance index are to the relevant paragraph in the PGPA Act.

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

17AD(g) Letter of transmittal

17AI Letter of

transmittal

A copy of the letter of transmittal signed and dated by accountable authority on date final text approved, with statement that the report has been prepared in accordance with section 46 of the Act and any enabling legislation that specifies additional requirements in relation to the annual report.

Mandatory

17AD(h) Aids to access

17AJ(a) About this report Table of contents. Mandatory

17AJ(b) Alphabetical

index

Alphabetical index. Mandatory

17AJ(c) Glossary of

terms

Glossary of abbreviations and acronyms. Mandatory

17AJ(d) Compliance

index

List of requirements. Mandatory

17AJ(e) Contacts Details of contact officer. Mandatory

17AJ(f) Contacts Entity’s website address. Mandatory

17AJ(g) Accessing this

report online

Electronic address of report. Mandatory

130 Section 7 | INDICES AND REFERENCES

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

17AD(a) Review by accountable authority

17AD(a) Review by the

accountable authority

A review by the accountable authority of the entity.

Mandatory

17AD(b) Overview of the entity

17AE(1)(a)(i) Section 2: Agency overview

A description of the role and functions of the entity.

Mandatory

17AE(1)(a)(ii) Organisational structure A description of the organisational structure

of the entity.

Mandatory

17AE(1)(a)(iii) TEQSA’s objectives 2019-23

A description of the outcomes and programmes administered by the entity.

Mandatory

17AE(1)(a)(iv) Purpose A description of the

purposes of the entity as included in corporate plan.

Mandatory

17AE(1)(aa)(i) Corporate governance Name of the accountable authority

or each member of the accountable authority.

Mandatory

17AE(1)(aa)(ii) Corporate governance Position of the accountable authority

or each member of the accountable authority.

Mandatory

17AE(1)(aa)(iii) Corporate governance Period as the accountable authority or member of

the accountable authority within the reporting period.

Mandatory

17AE(1)(b) N/A An outline of the structure

of the portfolio of the entity.

Portfolio departments - mandatory

TEQSA | Annual Report 2019-20 131

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

17AE(2) N/A Where the outcomes and

programs administered by the entity differ from any Portfolio Budget Statement, Portfolio Additional Estimates Statement or other portfolio estimates statement that was prepared for the entity for the period, include details of variation and reasons for change.

If applicable, mandatory

17AD(c) Report on the Performance of the entity

ANNUAL PERFORMANCE STATEMENTS

17AD(c)(i); 16F Performance against objectives Annual performance statement in accordance

with paragraph 39(1)(b) of the Act and section 16F of the Rule.

Mandatory

17AD(c)(ii) Report on Financial Performance

17AF(1)(a) Analysis of

TEQSA’s financial performance

A discussion and analysis of the entity’s financial performance.

Mandatory

17AF(1)(b) Appendix B:

Summary of resources

A table summarising the total resources and total payments of the entity.

Mandatory

132 Section 7 | INDICES AND REFERENCES

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

17AF(2) N/A If there may be significant

changes in the financial results during or after the previous or current reporting period, information on those changes, including: the cause of any operating loss of the entity; how the entity has responded to the loss and the actions that have been taken in relation to the loss; and any matter or circumstances that it can reasonably be anticipated will have a significant impact on the entity’s future operation or financial results.

If applicable, mandatory.

17AD(d) Management and Accountability

CORPORATE GOVERNANCE

17AG(2)(a) Corporate governance Information on compliance with section

10 (fraud systems).

Mandatory

17AG(2)(b)(i) Letter of transmittal A certification by accountable authority

that fraud risk assessments and fraud control plans have been prepared.

Mandatory

17AG(2)(b)(ii) Letter of transmittal A certification by accountable authority

that appropriate mechanisms for preventing, detecting incidents of, investigating or otherwise dealing with, and recording or reporting fraud that meet the specific needs of the entity are in place.

Mandatory

TEQSA | Annual Report 2019-20 133

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

17AG(2)(b)(iii) Letter of transmittal A certification by accountable authority that

all reasonable measures have been taken to deal appropriately with fraud relating to the entity.

Mandatory

17AG(2)(c) Corporate governance An outline of structures and processes in

place for the entity to implement principles and objectives of corporate governance.

Mandatory

17AG(2)(d) - (e)

N/A A statement of significant

issues reported to Minister under paragraph 19(1)(e) of the Act that relates to non-compliance with Finance law and action taken to remedy non-compliance.

If applicable, mandatory

AUDIT COMMITTEE

17AG(2A)(a) Corporate governance A direct electronic address of the charter

determining the functions of the entity's audit committee.

Mandatory

17AG(2A)(b) Corporate governance The name of each member of the entity’s

audit committee.

Mandatory

17AG(2A)(c) Corporate governance The qualifications, knowledge, skills or

experience of each member of the entity’s audit committee.

Mandatory

17AG(2A)(d) Corporate governance Information about the attendance of each

member of the entity’s audit committee at committee meetings.

Mandatory

134 Section 7 | INDICES AND REFERENCES

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

17AG(2A)(e) Corporate governance The remuneration of each member of the entity’s

audit committee.

Mandatory

EXTERNAL SCRUTINY

17AG(3) Corporate

governance

Information on the most significant developments in external scrutiny and the entity’s response to the scrutiny.

Mandatory

17AG(3)(a) N/A Information on judicial

decisions and decisions of administrative tribunals and by the Australian Information Commissioner that may have a significant effect on the operations of the entity.

If applicable, mandatory

17AG(3)(b) Corporate governance Information on any reports on operations

of the entity by the Auditor-General (other than report under section 43 of the Act), a Parliamentary Committee, or the Commonwealth Ombudsman.

If applicable, mandatory

17AG(3)(c) N/A Information on any

capability reviews on the entity that were released during the period.

If applicable, mandatory

MANAGEMENT OF HUMAN RESOURCES

17AG(4)(a) Human resources An assessment of the entity’s effectiveness in managing and developing employees to achieve entity objectives.

Mandatory

TEQSA | Annual Report 2019-20 135

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

17AG(4)(aa) Appendix C: Staffing profile Statistics on the entity’s employees on an ongoing

and non-ongoing basis, including the following:

a. statistics on full-time employees

b. statistics on part-time employees

c. statistics on gender

d. statistics on staff location.

Mandatory

17AG(4)(b) Appendix C: Staffing profile Statistics on the entity’s APS employees on

an ongoing and non-ongoing basis; including the following:

> statistics on staffing classification level

> statistics on full-time employees

> statistics on part-time employees

> statistics on gender

> statistics on staff location

> statistics on employees who identify as Indigenous.

Mandatory

17AG(4)(c) Appendix C: Staffing profile Information on any enterprise agreements,

individual flexibility arrangements, Australian workplace agreements, common law contracts and determinations under subsection 24(1) of the Public Service Act 1999.

Mandatory

17AG(4)(c)(i) Appendix C: Staffing profile Information on the number of SES and

non-SES employees covered by agreements etc identified in paragraph 17AG(4)(c).

Mandatory

136 Section 7 | INDICES AND REFERENCES

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

17AG(4)(c)(ii) Appendix C: Staffing profile The salary ranges available for APS

employees by classification level.

Mandatory

17AG(4)(c)(iii) Human resources A description of non-salary benefits provided to employees.

Mandatory

17AG(4)(d)(i) Human resources Information on the number of employees at each classification level who received performance pay.

If applicable, Mandatory

17AG(4)(d)(ii) N/A Information on aggregate

amounts of performance pay at each classification level.

If applicable, Mandatory

17AG(4)(d)(iii) N/A Information on the

average amount of performance payment, and range of such payments, at each classification level.

If applicable, Mandatory

17AG(4)(d)(iv) N/A Information on aggregate

amount of performance payments.

If applicable, Mandatory

ASSETS MANAGEMENT

17AG(5) N/A An assessment of

effectiveness of assets management where asset management is a significant part of the entity’s activities.

If applicable, mandatory

PURCHASING

17AG(6) Financial

management

An assessment of entity performance against the Commonwealth Procurement Rules.

Mandatory

TEQSA | Annual Report 2019-20 137

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

CONSULTANTS

17AG(7)(a) Financial management A summary statement detailing the number of

new contracts engaging consultants entered into during the period; the total actual expenditure on all new consultancy contracts entered into during the period (inclusive of GST); the number of ongoing consultancy contracts that were entered into during the previous reporting period; and the total actual expenditure in the reporting year on the ongoing consultancy contracts (inclusive of GST).

Mandatory

17AG(7)(b) Financial management A statement that “During [reporting period],

[specified number] new consultancy contracts were entered into involving total actual expenditure of $[specified million]. In addition, [specified number] ongoing consultancy contracts were active during the period, involving total actual expenditure of $[specified million]”.

Mandatory

17AG(7)(c) Financial management A summary of the policies and procedures for

selecting and engaging consultants and the main categories of purposes for which consultants were selected and engaged.

Mandatory

138 Section 7 | INDICES AND REFERENCES

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

17AG(7)(d) Financial management A statement that “Annual reports contain

information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website.”

Mandatory

AUSTRALIAN NATIONAL AUDIT OFFICE ACCESS CLAUSES

17AG(8) N/A If an entity entered into

a contract with a value of more than $100,000 (inclusive of GST) and the contract did not provide the Auditor-General with access to the contractor’s premises, the report must include the name of the contractor, purpose and value of the contract, and the reason why a clause allowing access was not included in the contract.

If applicable, mandatory

EXEMPT CONTRACTS

17AG(9) N/A If an entity entered into

a contract or there is a standing offer with a value greater than $10,000 (inclusive of GST) which has been exempted from being published in AusTender because it would disclose exempt matters under the FOI Act, the annual report must include a statement that the contract or standing offer has been exempted, and the value of the contract or standing offer, to the extent that doing so does not disclose the exempt matters.

If applicable, mandatory

TEQSA | Annual Report 2019-20 139

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

SMALL BUSINESS

17AG(10)(a) Financial management A statement that “[Name of entity] supports the

small business participant in the Commonwealth Government procurement market. Small and Medium Enterprises (SME) and Small Enterprise participation statistics are available on the Department of Finance’s website.”

Mandatory

17AG(10)(b) Financial management An outline of the ways in which the procurement

practices of the entity support small and medium enterprises.

Mandatory

17AG(10)(c) N/A If the entity is considered

by the Department administered by the Finance Minister as material in nature— a statement that “[Name of entity] recognises the importance of ensuring that small businesses are paid on time. The results of the Survey of Australian Government Payments to Small Business are available on the Treasury’s website.”

If applicable, mandatory

FINANCIAL STATEMENTS

17AD(e) Section 5:

Financial report Inclusion of the annual financial statements in accordance with subsection 43(4) of the Act.

Mandatory

140 Section 7 | INDICES AND REFERENCES

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

EXECUTIVE REMUNERATION

17AD(da) Appendix C:

Staffing profile

Information about executive remuneration in accordance with Subdivision C of Division 3A of Part 2-3 of the Rule.

Mandatory

17AD(f) Other Mandatory Information

17AH(1)(a)(i) N/A If the entity conducted

advertising campaigns, a statement that “During [reporting period], the [name of entity] conducted the following advertising campaigns: [name of advertising campaigns undertaken]. Further information on those advertising campaigns is available at [address of entity’s website] and in the reports on Australian Government advertising prepared by the Department of Finance. Those reports are available on the Department of Finance’s website.”

If applicable, mandatory

17AH(1)(a)(ii) Appendix F: Advertising and market research

If the entity did not conduct advertising campaigns, a statement to that effect.

If applicable, mandatory

17AH(1)(b) N/A A statement that

“Information on grants awarded by [name of entity] during [reporting period] is available at [address of entity’s website].”

If applicable, mandatory

TEQSA | Annual Report 2019-20 141

PGPA RULE REFERENCE PART OF REPORT

DESCRIPTION REQUIREMENT

17AH(1)(c) Appendix I:

Disability reporting

Outline of mechanisms of disability reporting, including reference to website for further information.

Mandatory

17AH(1)(d) Appendix D: Freedom of Information

Website reference to where the entity’s Information Publication Scheme statement pursuant to Part II of FOI Act can be found.

Mandatory

17AH(1)(e) Appendix J:

Corrections to previous annual report

Correction of material errors in previous annual report.

If applicable, mandatory

17AH(2) Section 6:

Appendices

Information required by other legislation. Mandatory

142 Section 7 | INDICES AND REFERENCES

Alphabetical index

A academic integrity 3, 4, 27, 32, 40, 41, 45, 48-50 accountable authority I, 2, 4, 7, 10, 12, 14, 52,

53, 62, 66, 67, 70, 129, 130, 132, 133 review by 2-4 see also Chief Commissioner; Saunders, Professor Nicholas accreditation see course accreditation

acronyms and abbreviations 124 Administrative Appeals Tribunal 11, 43, 46, 48, 57 review matters 11, 48

admissions transparency 44, 46, 49, 50 advertising and market research 119, 140 ANAO performance audit see Australian National Audit Office (ANAO)

annual performance statement I, 14-48, 131 applications and assessments 20-26 adverse decisions 20, 24, 26, 28, 29 completed 2, 17, 19, 20, 22, 25

conditions 11, 26, 28, 29, 47 improvements to process 2-4, 11, 15, 17, 18, 20, 21, 22, 37 median processing time 19, 20-24 number carried over from previous year

22, 23, 48 number decided and number of days to decision 22-23 performance against requirements of

TEQSA Act 24-25 provider compliance assessments 6, 11, 15, 36, 46-48, 108 received 22 timeliness of assessments 2, 17, 22-23 withdrawn 22, 48 see also course accreditation see also CRICOS assessments see also initial registration see also registration see also renewal of accreditation (re-accreditation) see also renewal of registration (re-registration) see also risk assessment APS Code of Conduct and Values 58 Assessment and Investigations Group 7, 11, 128 assessments see applications and

assessments Assurance Group 7, 11, 128 Audit and Risk Committee 12, 53-55, 57 AusTender 62, 63, 138 Australian Government Security Vetting

Agency 57 Australian National Audit Office (ANAO) 2, 3, 15, 44, 57

access clauses 63 performance audit 2, 3, 15, 44, 57 see also independent auditor’s report

Australian Qualifications Framework (AQF) 19, 40, 42, 124, 125 review 40

Australian Skills Quality Authority (ASQA) 17, 27, 31, 44, 124, 125

C caseload 10, 21-23 see also applications and assessments case management approach 17, 18 cash flow statement 66, 77, 78, 82 Chief Commissioner see Saunders, Professor

Nicholas (Chief Commissioner) see also Review by the accountable authority Chief Executive Officer 7, 9, 55, 62, 103, 117, 124 see also McClaran, Anthony (Chief

Executive Officer) see also remuneration Coaldrake, Professor Peter (Commissioner) I, 4, 8, 53, 117 Commission 52

meetings 52 Commissioners I, 3, 4, 7-9, 12, 14, 38, 44, 52, 53, 59, 67, 70, 103, 117, 134

roles and responsibilities 7 see also accountable authority see also remuneration see also Saunders, Professor Nicholas

(Chief Commissioner) see also Coaldrake, Professor Peter (Commissioner) see also Cooper, Professor Joan

(Commissioner) see also Martin, Dr Linley (Commissioner) see also Walsh, Professor Cliff

(Commissioner) committees 12, 52-55, 133, 134 see also Learning Committee see also Staff Consultative Committee

see also Workplace Health and Safety (WHS) Committee Commonwealth Cost Recovery Guidelines 61 Commonwealth Fraud Control Policy 57 Commonwealth Ombudsman 57, 134 Commonwealth Procurement Rules 62, 63, 136 Commonwealth Register of Institutions and Courses for Overseas Students (CRICOS) 10,

19, 47, 124, 125 CRICOS assessments 10, 19, 47 competitive tendering and contracting 62 complaints and concerns handling 11, 41, 58, 120 concerns about higher education

providers 34-35, 120 complaints about TEQSA 120 compliance activities 3, 6, 10, 11, 15, 27, 33, 36, 46-49, 108

TEQSA | Annual Report 2019-20 143

compliance index 129-141 conference see TEQSA Conference consultancies 63, 137, 138 consultation with stakeholders

see stakeholders contract cheating 3, 4, 27, 32, 35, 41, 44, 50 see also academic integrity Cooper, Professor Joan (Commissioner) I, 8,

53, 117

Corporate Group 7, 12, 55 corporate planning 44, 55, 56 Corporate Plan 2019-23 II, 3, 16, 18, 20, 27, 33, 37, 39, 41, 42, 46, 49, 52, 56

cost recovery 3, 4, 37, 61-62, 79, 91, 101 consultation on 3, 37 Cost Recovery Implementation Statement 101 see also Commonwealth Cost Recovery

Guidelines

course accreditation 8, 10, 11, 14, 16, 19, 20-27, 29, 30, 47, 60, 91, 101, 112 see also re-accreditation

COVID-19 pandemic 2, 14 CRICOS see Commonwealth Register of Institutions and Courses for Overseas Students

D Department of Education, Skills and Employment 3, 12, 19, 28, 42, 44, 125, 127 working with 19, 28, 42

disability reporting 120, 141

E ecologically-sustainable development and environmental performance 119 Environment Protection and Biodiversity

Conservation Act 1999 119 Education Services for Overseas Students (ESOS) 7, 11, 124-126 Education Services for Overseas Students

Act 2000 (ESOS Act) 7, 11, 28, 35, 109, 124 assessments see Commonwealth Register of Institutions and Courses for

Overseas Students National Code see National Code of Practice for Providers of Education and

Training for Overseas Students ELICOS see English Language Intensive Courses for Overseas Students Employee Assistance Program 119 enforcement 3, 15, 46 engagement see stakeholder engagement Engagement Group 7, 12 English language Intensive Courses for

Overseas Students (ELICOS) 3, 7, 11, 19, 35, 49, 109, 124, 126 ELICOS Standards 2018 7, 11 Enterprise Agreement 58-60, 135

Tertiary Education Quality and Standards Agency Enterprise Agreement 2018- 2021 58-60

Enterprise Risk Management Framework 52, 56 entity resource statement 110-111 ethical standards 56 Executive Office 7, 12 exempt contracts 62, 138 external experts (TEQSA experts) 3, 10, 20, 30,

45, 59, 60, 61, 87, 90 Register of Experts (database) 12, 60 work assignments completed 61 external review matters see Administrative Appeals Tribunal review matters external scrutiny 57, 134

F fees 2, 14, 37, 60-62, 79, 82, 87, 89, 91, 101 financial management 61-63, 136-139 financial performance 50, 52, 53, 66, 87, 131 financial statements 71-82

notes to 83-106 Foundation program providers 109 Foundation Program Standards 7, 11 Foundation program providers 109 fraud control I, 57, 132

Fraud Control and Anti-Corruption Plan 56 freedom of information 62, 89, 109, 119, 124, 141 Freedom of Information Act 1982 62, 109, 119

see also Information Publication Scheme (IPS) full cost-recovery model see cost recovery functional groups (TEQSA) see organisational structure

G glossary of terms 125-128 good practice 10, 14, 42, 58 good practice notes see also publications

39, 46, 50 grants 63, 140 guidance notes 39

H higher education providers 6, 10, 11, 15, 16, 18-20, 28, 33, 34, 36, 38-40, 43, 82, 91, 101, 108, 109, 112, 120, 126-128

monitoring 4, 7, 11, 15, 27, 33, 34, 37, 44, 47, 52, 120 registered higher education providers 6, 19, 23, 24, 28, 29, 36, 40, 43, 47, 108, 109,

120, 127, 128 see also compliance assessments see also concerns about higher

education providers Higher Education Standards Framework (HES Framework) 2015 (HES Framework) 3, 4, 7, 10, 11,16, 28, 29, 30, 36, 37, 44, 46-48, 108,

112, 124-127

Higher Education Standards Panel (HESP) 3, 12, 16, 40, 42, 44, 124, 126, 127

144 Section 7 | INDICES AND REFERENCES

human resources 58-61 adjustments in response to COVID-19 pandemic 58 see also Enterprise Agreement see also remuneration see also staff see also workplace consultative

arrangements

I independent auditor’s report 66-68 Indigenous staff see staff Information Publication Scheme (IPS) 119 information technology 58, 61

Information Technology Security Advisor 55 initial registration see registration

L Learning Committee 59 Legal Group 7, 11, 61 legal services 61

Legal Services Directions 61 legislative framework 6-7, 108-109 letter of transmittal I list of requirements see compliance index

M McClaran, Anthony (Chief Executive Officer) 3, 9-10, 59, 103, 117 Martin, Dr Linley (Commissioner) 3, 9, 53, 117 material change 11, 15, 17, 19, 36, 36, 127 Memorandum of Cooperation (MoCs) 32 Memorandum of Understanding (MoUs) 30-31 Minister for Education I, II, 6, 7, 8, 9, 16, 56, 57,

59, 61, 126, 127 Monument, Prue (Executive Director, Regulatory Operations) 10

N The National Code of Practice for Providers of Education and Training to Overseas Students 2018 (National Code) 7, 11, 28, 127

National Register of Higher Education Providers (National Register) 36, 40, 42, 43, 127

non-salary benefits 59

O Office of the Australian Information Commissioner 57 organisational structure 7-12

functional groups 10-12 see also Chief Executive Officer see also Commissioners see also Senior Management Team

outcome and program statement 16 expenses 112 see also performance against objectives

overview of the agency 6-12

P pandemic see COVID-19 pandemic parliamentary committees 57, 134 payroll services, shared with Productivity

Commission 58 performance against objectives 17-50, 131 Objective 1: Quality assure and regulate the sector in a timely, transparent and

risk reflective manner 17-36 Objective 2: Support providers to deliver high quality higher education,

protect student interests and enhance the reputation and competitiveness of Australia’s higher education sector 37-39 Objective 3: Provide advice and

information to inform decisions about the appropriateness and quality of higher education 40-45 Objective 4: Take prompt and effective action to address substantial risks to students or the reputation of the sector 46-50 performance audit

see ANAO performance audit statement of preparation 70 performance pay 59, 136 policy 3, 11, 27, 37, 42, 45, 56, 57, 60, 95 Policy and Analysis Group 7, 11 regulatory 3, 11, 37, 42 Portfolio Budget Statements II, 20, 27, 39, 41, 46, 49, 50, 71, 73, 75, 77, 79, 80, 124 procurement 55, 62, 139 see also Commonwealth Procurement Rules professional accreditation 3, 10, 12, 17, 27, 29, 40, 42 program see outcome and program statement protective security see security provider category 3, 4, 8, 11, 43, 127 provider category review 3, 4, 8 Public Governance, Performance and Accountability Act 2013 I, 14, 52, 53, 63, 70, 83, 100, 101, 109, 124, 129 publications 39, 43, 50 Good Practice Note: Making higher

education admissions transparent for prospective students 39 Good Practice Note: Improving retention and completion of students in

Australian higher education 39 Key risk findings on Australia’s higher education sector 40, 43 Statistics report on TEQSA registered

higher education providers 2019 40, 42, 43

TEQSA | Annual Report 2019-20 145

R re-accreditation see renewal of accreditation re-registration see renewal of registration recycling 119 registered higher education providers

see higher education provider registration 8, 10, 11, 14, 16, 19-21, 23, 25-27, 47, 91, 101, 112, 125, 127

see also initial registration see also re-registration regulatory decisions 7, 27, 29, 46, 48, 52 publication of 40, 42, 43 Regulatory Operations Group 7, 10, 11

see also Assessment and Investigations Group see also Assurance Group see also Monument, Prue (Executive

Director, Regulatory Operations) Regulator Performance Framework KPIs 18, 20, 27, 37, 39, 41, 46 remuneration

Commissioners 59, 117 Key Management Personnel 117 other highly paid staff 118 senior executives 118 staff 116 see also Audit and Risk Committee see also performance pay renewal of accreditation (re-accreditation)

2, 11, 20-23, 29, 60, 91, 101 renewal of registration (re-registration) 2, 11, 20, 23, 24, 26-28, 50, 91, 101 risk assessment I, 3, 4, 27-29, 33, 37, 38, 44,

45, 47, 57, 120, 127, 128, 132 Risk Assessment Framework 3, 27-29, 37, 38, 44, 45, 128 risk management 10, 12, 33, 34, 52, 54-56 risk ratings 15, 19, 27, 28, 33

for course accreditation or re-accreditation 29 for re-registration 28

S Saunders, Professor Nicholas (Chief Commissioner) I, 4, 7, 8, 53, 59, 70, 103, 117 security 12, 35, 55, 56, 57

information security 35 protective security 55, 56 Protective Security Policy Framework 55, 56 Security Committee 55 self-accrediting authority (SAA) 6, 29, 43,

124, 128

Senior Management Team (SMT) 10, 124 Service Charter 58

small business, procurement initiatives to support 62 staff Aboriginal and Torres Strait Islander staff

115, 135 employment screening 57 non-salary benefits 59 numbers 113-114 performance assessment 59 professional development and training 60 see also Enterprise Agreement see also workplace health and safety see also human resources see also remuneration Staff Consultative Committee 60 stakeholders

consultation 2, 3, 18, 28, 37-39, 41, 45 engagement I, 2, 3, 12, 17, 18, 21, 27, 29, 32, 33, 37, 38, 40-42, 44, 45, 49, 50, 52, 58, 60, 62, 120

stakeholder survey 3, 14, 17, 18, 37, 39, 42, 46, 49, 128 see also external experts see also Higher Education Standards

Panel see also Memorandum of Cooperation (MoCs) see also Memorandum of Understanding

(MoUs) see also stakeholder survey see also student engagement statement by the Accountable Authority and

Chief Financial Officer 70 statement of changes in equity 75-76 statement of comprehensive income 71-72 statement of financial position 73-74 student engagement 40, 41

Student Expert Advisory Group 3, 40, 41

T TEQSA Conference 2, 12, 40, 42, 45, 60, 72, 78, 89 Tertiary Education Quality and Standards

Agency (TEQSA) corporate governance 52-58 corporate services 61-63 leadership changes 2-4, 8, 9, 59 outcome and program statement 16 purpose 6, 15 summary of resources 110-111 see also committees see also financial performance see also legislative framework see also organisational structure see also overview of the agency see also review by the accountable

authority

Tertiary Education Quality and Standards Agency Act 2011 (TEQSA ACT) 6, 11, 15, 24, 32, 43, 44, 52, 59, 61, 108, 109, 115, 124, 126, 127 see also applications and assessments

146 Section 7 | INDICES AND REFERENCES

W Walsh, Professor Cliff (Commissioner) I, 9, 53, 55, 117 website conformity 61 workplace consultative arrangements

see also Staff Consultative Committee 60 Workplace Health and Safety (WHS) Committee 119

Work Health and Safety Act 2011 109, 119

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teqsa.gov.au