Audit Office of NSW – Reports and Audits

Financial Audits

The Audit Office of NSW conducts financial audits on the financial reports that public sector agencies must prepare each year.  This provides an independent opinion which assures Parliament and the public that the financial reports of public sector agencies fairly reflect their financial positions and operations.

For the majority of public sector agencies, with a 30 June balance date, the Audit Office aims to report to Parliament by the end of the calendar year.  The results of the Financial Audits are reported to Parliament in five volumes during the year.

Performance Audits

Performance audits are in-depth assessments of whether government agencies are achieving value-for-money, including their efficiency, effectiveness, economy and, in certain circumstances, compliance aspects.

They may cover the whole of an agency’s operations, one particular agency’s activity or an activity across a number of agencies.  The results are reported to the CEO of each agency, the responsible Minister, the Treasurer, and to Parliament.

When selecting which areas to audit, the Audit Office combines its own research with suggestions from parliamentarians, agency CEOs and members of the public. The benefits of each topic are evaluated according to the potential for cost savings, the likely impact, and possible improvements in public administration.  Committees of Parliament, such as the Public Accounts Committee, are consulted on the audit program to ensure that their work is not duplicated.  Parliamentary Committees will also often refer performance audit topics to the Audit Office.

In response to requests from parliamentarians, the Audit Office is currently working on providing more information on how topics are selected and on new ways to involve parliamentarians in this process.

The Audit Office also periodically conducts follow-up reviews to examine the extent to which agencies have changed their practices as a result of previous performance audits.

At times an issue is identified that affects a number of agencies.  The Audit Office may then issue a better practice guide to help agencies to implement the recommended improvements.

In 2005, 15 performance audit reports and two better practice guides were published.  Eight of the reports examined topics not previously reviewed and the other seven reviewed whether agencies had acted on recommendations from previous audits.

Over the next two years the Audit Office’s performance reviews will continue to focus on the current priority interests of parliamentarians and the community.  These areas are;

  1. public infrastructure
  2. transport services
  3. law, order and public safety
  4. health and welfare services
  5. education
  6. management of the environment
  7. governance and public sector management.

Protected Disclosures

The Protected Disclosures Act 1994 protects “whistleblowers” who identify instances of maladministration, corruption, or serious and substantial waste in a government agency.  The Auditor-General examines any allegations of serious and substantial waste of public money (except regarding local governments). The NSW Ombudsman examines maladministration, and the Independent Commission Against Corruption investigates corruption.

None of the 17 allegations received by the Audit Office in 2005 had sufficient evidence to conclude a serious or substantial waste, nor were they significant enough to warrant a separate report to Parliament.

Compliance Reviews

The Audit Office’s compliance reviews assess how well NSW Government agencies comply with a selection of legal requirements, government policies and central agency directives.  A representative sample of agencies is tested and the recommendations often highlight solutions that could apply across the NSW public sector.

In 2005, nine compliance reviews were conducted.  Five of these examined new issues and four looked at whether agencies had improved their practices since the previous compliance review.

Special Reviews

The Audit Office also examines specific issues, typically within a single agency, and often at the request of a Member of Parliament or external client.  These reviews are included in Auditor-General’s Reports to Parliament – Financial Audits, published on a number of occasions each year.