The independent reports that the Auditor General provides to Parliament inform Members and the public about the effectiveness and efficiency of public sector agencies and services. The reports often generate significant interest in Parliament and beyond. Positive reports can increase parliamentary and community confidence whereas adverse findings can alert Parliament and the public to matters of concern. Given the impact of the reports to Parliament, it is extremely important that we select the right topics for audit.
Deciding what to audit is a key part of the Auditor General’s independence and is not subject to direction from Parliament or government. This independence has to be exercised responsibly, so we have processes in place, which make sure that the selection of topics is objective, robust and transparent. See our topic selection framework below.
Each year we receive many enquiries, expressions of concern and requests for audits and investigations from Members of Parliament and the community. The information we receive often helps us to identify topics for future audits. Our topic selection process allows us to balance these demands and to choose audits based on full consideration of their relative merits.
Twice a year, all the potential topics for audit are collated and priority projects are identified to establish our forward program. We seek to select a program that is balanced in its coverage, contains topics that matter to Parliament and the community, and that reflects how and where the state is spending taxpayer’s money. We use the following criteria:
Materiality: Does the activity or program have potentially significant financial, economic, social or environmental management implications?
Impact: Is an audit likely to have a positive impact on the community? Could it lead to improvements across the public sector in efficiency, effectiveness or accountability? Would an audit address concerns within Parliament?
Risk: Are there any indicators of known or suspected problems? Has the program changed significantly or undergone sudden expansion? Are issues emerging in related areas that could affect the area being considered for audit? Are there inherent risks that may not be well managed? Would any problems result in adverse consequences?
Context: Is there strong community interest in the topic? Does the program have high political sensitivity or national importance? Is it the right time to review this area? Are issues already well known? Is there another review or audit in progress covering similar issues? Would an audit of the area reinforce other important current messages or themes?
Coverage: Have we audited this area/agency recently? Does the topic help meet our objective of providing a balanced coverage of government portfolios and performance over time?
Auditability/Efficiency: Is the area amenable to audit? Will information and evidence be available? Can a past methodology be used or will the methodology be reusable? Can analytical tools be used? Can it be audited with resources that match the impact and materiality of the topic or will it take disproportionate resources for limited benefit?
Once established, our forward work program is discussed with the Public Accounts Committee and the Estimates and Financial Operations Committee. Once an audit has begun, we make its objective, focus and timeframes public via the our audit program.