NSW Auditor-General highlights issues with Justice SAP project

Justice SAP

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An annual report on the operations of the NSW Department of Justice by NSW Auditor-General Margaret Crawford has outlined what went wrong with the Justice SAP implementation, which was completed throughout the department and cluster during the 2016/17 alongside the establishment of the Business Support Centre (BSC) designed to centrally process finance and human resource operations.

The department already spent $2 million in the 2016/17 financial year to fix the problems, with a further $21 million (possibly up to $23 million) to be spent in 2017/18 to fully rectify the implementation issues and reinstate property controls in the system.

According to the report, issues arising from the interrelated projects included:
• The inability of staff to complete bank reconciliations, resulting in a significant number of uncleared reconciling items;
• Roles and responsibilities in the SAP system not being appropriately assigned, which mean that system workflows did not operate as intended;
• The absence of management and payroll reporting, which reduced the effectiveness of oversight controls;
• Concerns over the accuracy of leave balances;
• Concerns over the accuracy of inter-company transactions and balances; and
• General concerns over the integrity and accuracy of financial data and reporting.

While a common contributor to the issues was cited as a lack of recognition of how interdependent the two projects were, the report outlined other problems with project management, which included:
• The lack of a formal assessment of the relevant skills and experience of key project personnel before project commencement.
• The absence of an effective ongoing project risk identification and management process, including a ‘living’ risk register that captured interdependent risks across both projects.
• The ‘go live’ decision for each Justice SAP wave was not informed by a full understanding of the project or BSC’s readiness, and the risks of going live at that point.
• Insufficient focus on stakeholder engagement and change management.
• Insufficient independent quality management over the project, together with contract and performance management. This could have highlighted risks and issues at an earlier point and allowed for greater control and management.

The Auditor-General noted that some of the issues that bedevilled this project was similar to those identified in the post-implementation review of the LifeLink system, which was completed in May 2015.

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