The collapse of state-owned coal producer Solid Energy has been well documented in recent months.
The company has gone from being prepared for sale under the Government's mixed-ownership model to barely surviving as it awaits a decision on whether it will be financially bailed out by taxpayers.
A select committee hearing into the company's state of affairs saw near farcical scenes as the new chairman and chief executive found themselves unable to respond to probing questions from members of Parliament tasked with finding answers to some vexing questions.
Consequently, John Palmer and Don Elder did appear before the select committee but no in-depth answers were provided about how such a shining light in New Zealand's energy future had been extinguished.
This week, accountancy firm Deloitte provided the Treasury with a review of Solid Energy, the results of which were not easy reading. Deloitte states it is difficult in the formal written correspondence to identify the true nature of the relationship between Solid Energy's chairman and chief executive and the Treasury.
But several Treasury staff interviewed identified a sense of tension coming from the chairman and chief executive, particularly when challenged on fundamental aspects of their business and strategy.
The picture becomes clear early on in the Deloitte review that Solid Energy believed it was above having to report to the Treasury, or even the Crown Ownership Monitoring Unit (COMU), on occasions.
There was a series of small events which cumulatively over time created an impression of an entity that was not as respectful of the Treasury's role and responsibility as ministers would expect from a state-owned enterprise.
There were numerous occasions when Solid Energy was late in filing its draft statement of corporate intent and business plans, which put pressure on Treasury resources or required extensions from ministers.
And there were continued efforts to change the rules concerning consultation levels with respect to investment activity, along with an inconsistent dividend policy.
As was made public during the near financial collapse of the company, there were requests for injections of new equity when it was ''very clear'' this was not an option the Government would consider.
Added to this was the company's persistence with its view on energy prices, which was out of line with consensus views, and a refusal to provide supporting analysis when challenged on this view.
The report is a damning review of a company owned by taxpayers that over-stretched itself without looking ahead and factoring in falling coal and oil prices, something about which private sector analysts were warning.
Solid Energy was required to substantially downgrade its valuation after the Treasury required it to remove a future project which inflated the commercial valuation by a factor of 16. Even then, the Treasury did not believe the valuation, but it was left as being the board's responsibility to value the company.
Clouding the issue was the past successful financial performance of Solid Energy. In hindsight, it is abundantly clear that moving out of its core role of coal extraction and sales into more esoteric fields was a mistake.
Hundreds of people lost their jobs through this mismanagement and, quite rightly, there have been calls for better monitoring.
So what can taxpayers expect from here?
The Treasury says it identified concerns with Solid Energy early on and subsequently took steps, including seeking an external review of the company's business strategy, rejecting its statement of corporate intent, moving the company to intensive monitoring and seeking the appointment of an investigating accountant.
Treasury secretary Gabriel Makhlouf said the review noted Solid Energy's failure raised questions about how and when monitoring processes were applied, but that for Treasury to have taken more fundamental actions would have required it to express a lack of confidence in a board with a sound track record at a time the company was performing well.
The Treasury is committed to continually improving its processes, where it can. A monitoring improvement programme was started last year to introduce changes over time.
The Treasury will consider how it monitors governance and will work with boards on what that will involve in the future.
With 49 commercial enterprises to monitor, with assets of about $140 billion, correct procedure and reporting must be priorities.
