2021–22 saw a high level of engagement with the Parliament of New South Wales. In the Legislative Council, we were invited to give evidence to the Public Accountability Committee inquiry into the Transport Asset Holding Entity and to the inquiry into the Planning and Delivery of School Infrastructure in New South Wales. We also gave evidence to two Budget Estimate hearings.

We briefed the Legislative Assembly’s Public Accounts Committee on nine occasions, including two public hearings following up on the implementation of our recommendations in reports from August 2019 to December 2020.

Our Audit Insights 2018–2022 report analysed key findings and recommendations from audit reports over the past four years. Reflecting on most recent audits and reports, it called out threats to the integrity of government systems, processes and governance arrangements.
Weaknesses identified could have been avoided if established processes had been followed.

Our Integrity of Grant Program Administration report coincided with the Legislative Council’s inquiry into the Integrity, Efficacy and Value for Money of NSW Government Grant Programs and also ICAC’s investigation into ‘pork barrelling’. In response, the government asked the Productivity Commissioner and the Department of Premier and Cabinet to review grants processes. Their report addresses many of the matters raised in our audit report and, if implemented, will address the recommendations we made.

This is but one example of the impact our work can have and is testament to the skills of our staff in applying objective, independent analyses to government activities in compliance with audit standards.

Recently, international and national attention has focused on the role and quality of audit in the face of business failures. We have implemented a comprehensive quality assurance framework including a Quality Audit Review Committee chaired by an experienced independent from the profession. This committee oversees the conduct of audit file reviews, some of which are undertaken by a ‘Big Four’ firm.

We also have a Technical Issues Committee (TIC) to consider complex or significant matters that may result in the inclusion or removal of modifications to audit reports. The TIC met frequently in 2021–22 given the high number of contentious matters encountered in our audits and reflecting our commitment to preference quality over timeliness in everything we do. The technical knowledge and professionalism of Audit Office staff participating in this committee is outstanding.

Protecting the reputation of the Audit Office is vital to ensure our credibility and maintain public trust in what we do. We foster a culture that instils ethical behaviour supported by a clear Code of Conduct and ethical framework. This is further reinforced by our ‘Contagious Integrity’ organisational value. I framed my presentation to the Australasian Reporting Award’s annual conference around the need for the Audit Office to be transparent in reporting all measures, whether good or requiring improvement, to set the tone for the agencies we audit.

At this conference I was asked a question often posed: who audits the Audit Office? The Public Accounts Committee (PAC) examines the auditing practices and standards of the Auditor-General in each Parliament, that is, once in every four years. Its 2021–22 review, tabled in Parliament on 21 September 2022, concluded that we conduct audits in compliance with current professional standards and our enabling legislation. The report also concluded that the Audit Office is well functioning and staffed by professional and dedicated auditors.

It has been a tough couple of years for everyone and staff of the Audit Office are no exception. Like all parts of the economy and government, recruitment and retention remained a challenge, and some of our staff have been personally impacted by COVID-19 or other illnesses.

In response, we decided that the health and wellbeing of staff and their families should be our priority. We backed this up with a range of measures to support people. For example, we adjusted audit and reporting deadlines, provided additional leave days, and held mental health first aid training, wellbeing workshops and lunch ‘n’ learn sessions. We also provided financial support to properly set up work areas at home, and we sponsored team lunches and coffee vouchers for staff when they could come back into the office.

The Office Executive researched and considered evolving models of work in light of the changes that had occurred in response to the COVID-19 pandemic. We agreed on a set of principles to guide flexible work practices and consulted with staff on a new model. This model balances in-person attendance for connection, innovation and collaboration, with remote working activities. The model empowers our staff to determine the best mix of working arrangements for themselves, their team and their clients.

We continued to promote diversity and inclusion through our employment practices, and recognition and celebration events. Significantly, we now include our Reconciliation Commitment Statement in all our reports to Parliament.

In addition to providing assurance around our audit practices, the PAC quadrennial review made two strategic recommendations to ensure the Audit Office continues to meet its objectives and the independence of the Auditor-General is maintained. While we support these recommendations, they require acceptance and implementation by Parliament.

In the immediate term, our commitment to quality and to building a highly committed and capable workforce will ensure our work continues to have impact as it has in 2021–22. We will build on the theme of integrity in all our audits to support the Parliament to hold government to account and provide insights that improve trust and outcomes for the people of New South Wales.

I am very proud of the great work of the Audit Office of New South Wales. This is only possible because of the professionalism, dedication and capability of our workforce as a whole. I am privileged to lead this group of individuals who I value, trust and respect. Thank you all for another great year.