200 years of audit impact 

Learn more about our history.

On 8 November 1824, public sector auditing was introduced in New South Wales with the appointment of William Lithgow, the first Auditor of Colonial Revenue. The role evolved to ‘Auditor General’ in 1827 and as the 24th person to hold the role, I am proud of all that has been achieved for the many generations of people who call New South Wales home. 

This annual report features stories from people who have led and worked in the Audit Office over its 200-year history. The Audit Office showcased the role and contributions of public sector auditors in March this year with an exhibition at Parliament House. 

We share our bicentenary with the NSW Treasury, the NSW Supreme Court, and Parliament’s Legislative Council – all significant contributors to our present system of government

This year we examined the performance of non-government organisations for the first time since our mandate was expanded in 2022. Follow-the-dollar powers enable us to audit the activities of non-public sector entities when those entities are using public money to deliver a state purpose. The Oversight of the child protection system and the Safeguarding the rights of Aboriginal children in the child protection system reports assessed the performance of five non-public sector organisations contracted to deliver services on the government’s behalf. The audits found that the NSW child protection system needs a significant overhaul. I intend to work with my team to progress our methodology for working with the follow-the-dollar mandate and to focus on our ability to follow up audit recommendations. This is included in our forward Annual Work Program 2024–27.

Engaging directly with the people and organisations impacted by the work of the Audit Office has been a key priority of mine as Auditor-General. I have relished opportunities to visit and hear from local council representatives, Audit and Risk Committee members, advocacy groups, auditees and parliamentarians. Improving the satisfaction of parliamentarians with our reports and services is a priority. So too is improving how we work with the local government sector. To remain relevant, our work must be timely and actively used to improve outcomes for the people of New South Wales. Finding ways to ensure this happens is important and will continue to be a focus of mine in the future.

Over the past year, the Audit Office made progress on the development of an Impact Reporting Framework. The goal is to understand how our work makes a positive contribution to state outcomes, and to track and measure this to help us make decisions about where to invest our resources. An area that we are particularly looking into is how our recommendations are not just accepted, but implemented, and what follow-up takes place by management, Audit and Risk Committees, and Parliament. This is a complex area, but one worthy of exploring and I am enthusiastic about the direction the project is heading in and look forward to sharing more on this in the year ahead.

The Audit Office’s Corporate Plan 2020–2024 outlined strategic priorities for a four-year period that concludes in December 2024. In 2023–24, we assessed progress against the objectives set out in this plan. Our annual reports have consistently highlighted the key achievements from each of our four strategic objectives. Much has been accomplished during this time, and we are now in the process of determining the focus of our next Corporate Plan. 

Our future direction will have a stronger focus on identifying and reporting on wastage of public resources, an existing mandate we have within the Government Sector Audit Act 1983. Over the next few years, we will enhance our audit methodology to better analyse and report on how efficient and prudent the use of public funds is by government.

Efficiency is not only a focus when auditing government entities. It is also a lens we apply internally. We are looking at ways to respond to the rapid changes in emerging technologies by making better use of data analytic solutions, including automation and predictive analytics, to enhance the efficiency and effectiveness of our audits. Over the coming months, we will continue to work with auditees to establish data platforms for technology-driven innovations to enable more timely analysis and reporting. 

The NSW Government’s commitment to climate change was established when the Climate Change (Net Zero Future) Act 2023 was passed by Parliament in November 2023. This, along with the AASB’s approval of new Australian Sustainability Reporting Standards, has meant that we have turned our attention to developing capabilities and methodology to equip us to provide assurance on agencies climate disclosures.

I am committed to serving the people and the Parliament of New South Wales. I look forward to the next eight years and helping Parliament hold government to account for its use of public resources.

The Office Executive provides the leadership necessary for the Audit Office to achieve its strategic direction and goals. It is chaired by the Auditor‑General.

Organisational structure at 30 June 2024

The ‘Enhancing our impact, demonstrating our value’ strategic objective aims to increase the impact of our work, and help us achieve our vision of ensuring that our insights inform and challenge government to improve outcomes for citizens. 

Improving our engagement with stakeholders 

Engaging effectively with external stakeholders to ensure our audits are relevant and lead to improved public sector reporting and performance is core to this objective. Our External Stakeholder Engagement Strategy, and supporting roadmap of activities, help to consistently communicate our role and work, provides opportunities to interact with stakeholders and drives how we undertake external engagement. 

Our bicentenary 

This year marks 200 years since William Lithgow was appointed the first Auditor of Colonial Revenue on 8 November 1824. We celebrated this significant milestone in the history of our system of government in New South Wales with a public exhibition at NSW Parliament titled More than numbers: 200 years of audit impact. In-depth research into the history of the Audit Office and the role of the Auditor-General was conducted to inform the exhibition, and stories were shared with employees throughout the year as part of an ongoing internal campaign to celebrate our history. 

In November 2023, then Auditor-General Margaret Crawford delivered a speech at NSW Parliament on 200 years of audit impact, as part of the NSW Legislative Council’s own bicentenary celebrations. The speech explored the history of New South Wales’ first Auditor-General in 1824, the colonial environment, and the legislative changes that have enabled the Auditor-General to evolve and help Parliament hold government accountable for its use of public resources. 

Our research and celebrations have deepened connections with our purpose, and have helped to increase awareness and understanding of our role in ensuring accountability and transparency for the NSW public sector. 

Transitioning to a new Auditor-General 

In April 2024, Bola Oyetunji began an eight-year term as the 24th Auditor-General for New South Wales. A full plan of engagement activity was initiated shortly after commencement, and in the first three months of his term the Auditor-General connected directly with a broad range of stakeholders, including parliamentarians, secretaries, council mayors, chief executives, Audit and Risk Committee chairs and local government professionals. These meetings allowed key stakeholders to meet the Auditor-General and hear about his key audit focus areas. Most importantly, they were an opportunity to hear directly from auditees about challenges and opportunities. 

Beyond New South Wales, the new Auditor-General also actively engaged with the broader international audit community, including the Australasian Council of Auditors-General (ACAG) and the Pacific Association of Supreme Audit Institutions (PASAI). 

Connecting with stakeholders 

We briefed parliamentarians and their staff on our Annual Work Program 2023–26 after its publication in August 2023. Across two briefings, we outlined the rationale for our forward program and received valuable feedback to help shape meaningful programs of work in the future. 

Our Annual Work Program 2024–27, released in August 2024, provides further opportunities to engage with key stakeholders of the Audit Office. 

We also participated in four parliamentary inquiries and appeared twice at Budget Estimates. 

In August 2023, then Auditor-General Margaret Crawford delivered the Garran Oration at the National Gallery in Canberra on the topic of trust, accountability and integrity. This provided a unique opportunity to discuss our role and how agencies can best respond to audit recommendations.

Representatives from the Audit Office also presented at the PASAI Congress in the Cook Islands on the digital future of auditing, and on the topic of human resource strategy.

Innovations in our reporting process 

To improve efficiencies in the report development and review process, a number of process changes were piloted during 2023–24. Chief among these was an assessment of the technology used to coordinate concurrent reviews in real time, and the ability to acquit feedback, assure version control and improve user experience. An exploratory approach was taken, and formal adoption of a new review process is planned for 2024–25. 

We also refreshed the design of our report covers, and introduced a new suite of social media graphics to improve engagement with report findings. 

Looking forward, a pilot of editing software that integrates with design software, will be undertaken to identify opportunities to further increase efficiencies. 

Measuring our impact and value 

Evaluating how our work contributes to improved outcomes for citizens, and how it is perceived by key stakeholders, is a priority. Work took place during the year to improve how we do this. Routine assessment measures include ascertaining how many recommendations are accepted by our auditees and asking if: 

• parliamentarians feel our reports and services improve public sector administration 
• auditees believe our performance audits help improve performance 
• auditees value our recommendations to improve the financial management and internal controls of their organisations. 

When it comes to accurately measuring impact, we recognise that additional indicators are needed, and we progressed the development of an Impact Reporting Framework during the year. This will guide us to better assess, document and communicate the effect that our work has on public administration in New South Wales. This year, we engaged with various audit institutions globally to understand how they report their impact. 

While certain reports that we table in Parliament receive media attention, media outreach is not a metric we use to measure our impact. Our focus is on maintaining integrity and accountability in the reports themselves and so we avoid reporting on how our work is interpreted in the media. 

The year ahead 

In 2024–25, we will continue to engage regularly with stakeholders to ensure that our work is relevant, constructive and valued. As our Corporate Plan 2020–2024 comes to a close, we will ensure that effective stakeholder engagement is front of mind when setting our new strategic direction. We will also begin capturing and reporting the broader impact of our work via our Impact Reporting Framework.

* Prior to 2022–23, we reported on the number of employees who agree our organisation respects individual differences, and our Corporate Plan included a 90% target for this measure. In 2022, this question was removed from the NSW public sector People Matter Employee Survey. We now report on this alternate measure of diversity and inclusion.

Our ‘Building capability for the future’ strategic objective aims to prepare employees for an evolving professional environment, to attract and retain the workforce we need, and to equip our people with the right tools, processes, culture, skills and resources to deliver insightful audits now and in the future. In 2023–24, we progressed key projects that will help us deliver on this objective. 

Transforming our digital environment 

In 2019, we established a program of work to transform our digital employee experience. The program sought to reduce complexity in our digital working environment, enhance the employee experience, and improve how we create, access, share and store information both internally and with our stakeholders. The program, which incorporated the implementation of new technologies and communication tools, was guided by our Digital Workplace Strategy and supported by comprehensive change management. 

In February 2024, we closed one of the program’s most significant projects, the CoLab project – our laboratory for collaboration. Established in 2021, CoLab delivered: 

• a communication portal to improve how we request and share audit information with our stakeholders
• a new platform to improve how we communicate across the organisation and streamline document collaboration 
• an in-place records management solution to modernise our recordkeeping approach. 

The project was delivered within the approved $1.8 million budget. It was also delivered to the approved schedule, which included a six-month extension to responsively enable additional design and development iterations for our communication portal. Effective change management was a key focus for the project, and continues to be as we embed and operationalise the change. 

As well as meeting time and cost objectives, the CoLab project also met all high-level deliverables. At project close, four of the project’s 14 benefits had been fully realised, with many of the remaining benefits already partially realised and due to be measured at the end of 2024. In addition to measuring the realisation of project benefits, we also conducted a comprehensive review of lessons learned which we will carry forward to future projects. 

The CoLab project has provided a modern digital working environment that will continue to evolve to meet the requirements of our organisation and our stakeholders. With the project now complete, we turn our attention to the final stage of our program of work to enhance the digital employee experience, which includes embedding our new tools and technologies and optimising our processes.

Progressing our Workforce Strategy 

We aim to build a workforce that is diverse, flexible, resourced and has the right capability to support current and future needs. Continuing to implement our Workforce Strategy was a key focus of this strategic objective in 2023–24. 

Building digital audit capability 

Our audits are underpinned by a strong technology base, and they maintain a focus on cyber security risks in the NSW public sector. Key achievements this year include: 

• increased use of data and analytics in 57 financial and seven performance audits in the calendar year 2023. This included the use of unstructured data in performance audits and external data sources to review agency conflicts of interest 
• the development of local government sector dashboards to improve how we identify data outliers and to streamline the assessment of audit risks and audit risk assessment processes 
• ongoing training and development activities on auditing and responding to cyber risks and data analytics in line with our Data Capability Framework 
• focused reporting on cyber security in our Auditor-General’s reports to Parliament and maintained focus in our Annual Work Program on cyber security challenges facing NSW public sector agencies. 

Improving our resourcing approach 

We continued to establish a data-led, demand-driven resourcing model this year, and progressed our three-year roadmap of activities to improve our resourcing approach in the Financial Audit Branch. This included implementing feedback opportunities to foster continuous improvement and responsiveness within our teams as well as:  

• appointing a dedicated branch manager, responsible for resourcing 
• completing more audit work before year-end to better balance workloads throughout the year and minimise the impacts on employees during peak periods 
• upgrading training opportunities for new hires outside our regular cycle to ensure that no employee is disadvantaged, and that our workforce remains agile and well-prepared 
• reviewing our commissioning model to bring the delivery of more audits in-house, resulting in some resourcing changes. 

These initiatives contribute to our commitment to stabilise workloads, promote team balance, and prioritise employee wellbeing. 

Enhancing our graduate experience 

This year we used our new employee value proposition to improve our graduate recruitment program. Throughout the year, we also refined our approach to developing graduates, enhancing the content and delivery methods of our training programs. We ensured that new graduates have structured audit work allocations and introduced review points to promote continuous development and alignment with professional standards. 

Enabling our flexible work practices 

Flexible work practices are central to our employee value proposition, helping us attract and retain high-quality employees. Our model for working flexibly is centred on a hybrid approach that balances remote working with in-person attendance for connection, innovation and collaboration. The model is supported by a toolkit that helps leaders and individuals determine the best mix of working arrangements for themselves, their teams and their stakeholders, and a committee who will ensure the model evolves to meet the changing needs of our organisation. 

Implementing our Diversity, Inclusion and Accessibility Roadmap

Our Diversity, Inclusion and Accessibility Roadmap 2021–25 outlines focus areas, objectives and planned activities that guide us towards a stronger, more representative workforce and help us achieve the objectives outlined in our Diversity, Inclusion and Accessibility Framework. This year we established a new wellbeing and diversity business partner role that is responsible for driving the delivery of these objectives, demonstrating our commitment to diversity, equity and inclusion. 

The year ahead 

In 2024–25, we will commence delivery of the final stage of our program of work to enhance the digital employee experience and we will develop and launch our new four-year Corporate Plan. We will remain focused on building the capability of our workforce and preparing our people for an evolving professional environment, including responding to developments in technology and climate reporting. We will also continue to progress our Workforce Strategy.

Our ‘Quality in everything we do’ strategic objective ensures a continued focus on the delivery of objective and trustworthy audits for our stakeholders. We maintain this focus on quality by performing according to the highest standards, safeguarding our independence and ethics, upholding data security, and driving effective monitoring and learning. 

Uplifting our cyber resilience 

Cyber resilience is an evolving and integral part of our System of Quality Management. Managing our strategic cyber security risk requires us to continuously evaluate threat and control landscapes, and ensures our defences are consistent, appropriate, reasonable and effective. This helps us keep pace with the constantly evolving environment, and ensures our initiatives and controls remain effective in mitigating cyber security risks. 

This year, we maintained our ongoing focus on uplifting cyber resilience, including maintaining our ISO27001 security certification, improving risk management of third parties, implementing new segregated operating environments for administrative activities, introducing red team exercises and developing a policy to help manage the risks and opportunities associated with artificial intelligence. 

Upgrading our audit software 

In March 2024, we closed a project to replace our audit software system that was approaching its end of life. The new cloud-based audit software is an end-to-end integrated solution that is configured to suit the varying needs of both financial and performance audits. Our auditors are now supported by a platform with enhanced system performance and stability, and increased visibility of audit status and progress through configurable dashboards and reporting. 

The project budget was approved for $1.9 million and the project was scheduled to close in February 2025. The actual implementation costs at project close were $1.2 million and the project closed in March 2024, 11 months ahead of schedule. 

The project was supported by extensive change management, a comprehensive training program and the development of a resource library. Although the project has now closed, we will remain focused on optimising all the functionalities within the platform and to realise the benefits highlighted within the business case. 

The year ahead 

In 2024–25, we will maintain our focus on advancing our cyber security resilience. In planning our strategic direction for the next four years, we will prioritise maintaining high quality standards, safeguarding independence and ethics, ensuring data security, and enhancing monitoring and learning efforts in relation to how we deliver our audits.

The ‘Securing our future’ strategic objective focuses on providing sustainable value-for-money audits and investing in tools and methodologies to ensure our continuous improvement. We will secure our future by developing fiscally responsible financial frameworks, utilising advances in data and technology to deliver greater insights, and promoting innovation across our business. 

Legislative framework 

The Government Sector Audit and Other Legislation Amendment Act 2022 commenced on 28 November 2022. It established the Auditor-General as an Independent Officer of the Parliament, introduced follow-the-dollar powers, confirmed the Auditor-General’s entitlement to access confidential information, and authorised the Auditor-General to disclose confidential information in certain circumstances. Following on from this, we have continued to embed processes and guidance to effectively operationalise these new powers and arrangements. This work has included: 

• developing guidance on implementing follow-the-dollar powers in our performance audits 
• providing guidance to audit teams on processes and requirements if the disclosure of confidential information is proposed. 

We also established an internal operational legislation working group to monitor and share information about activities in agencies and Parliament that may impact the Auditor-General’s mandate. 

Uplifting our data analytics capability 

We are increasing our use of structured and unstructured data to inform audit findings and insights that improve public sector administration and outcomes for citizens. Our Systems Assurance, Cyber and Data Branch responds to increased risks and opportunities associated with information technology, and the growing availability of large amounts of data. Its aim is to leverage data tools and analytics to enhance audit effectiveness, planning, procedures, control testing, risk assessments and quality.

We progressed the initiatives on our data strategy and roadmap including: 

• embedding the use of data analytics tools in our financial and performance audits to improve the effectiveness and/or efficiency of the audit process 
• upgrading to a cloud version of our unstructured data tool for performance audits 
• commencing an audit data platform proof of concept with the Data Analytics Centre
• exploring risks and opportunities associated with artificial intelligence (AI). 

Our data team played a pivotal role in seven performance audit engagements and 57 financial audit engagements, underscoring their integral involvement across both departments. Our objective to leverage advances in data analytics capabilities is further supported by government funding secured for the next year. 

Implementing our Innovation Roadmap 

In 2023–24 we invested 2.4% of our operating expenditure on innovation, down from last year’s investment of 3.5% but above our two per cent target. 

We advanced the delivery of our Innovation Roadmap by embedding and enhancing a new audit communication portal, supporting the use of data analytics tools, integrating a digital signature solution, and piloting a meeting booking tool to enable coordination with external stakeholders. We also introduced an idea management process and drafted an Innovation Governance Framework, supporting our ambition to create a culture of innovation at the Audit Office and drive opportunities for better and more efficient processes and ways of working.

The year ahead 

In 2024–25, we will continue to deliver our data and innovation roadmaps, and focus on extracting the benefits from our recent investment in new tools and ways of working to ensure our audits are efficient and provide value for money. 

We will also support financial and performance audits that integrate data, advance training of data partners and continue to upskill employees in the use of data analytics tools. We will continue to explore technology solutions and the potential use of AI to assist in early notifications of bills and amendments, as well as opportunities to engage in our waste mandate as part of our audit delivery

• 83% of parliamentarians agree we operate independently from government

• 75% of parliamentarians are satisfied with our reports and services

Our relationship with Parliament

Parliament needs reliable information on the operation of New South Wales’ government entities, and the use of public money. The Audit Office provides independent audit opinions on NSW public sector financial statements, increasing confidence in their reliability. We also conduct performance audits that provide information on how well government programs and services are delivered.

We report directly to Parliament. The Public Accounts Committee (PAC) holds the entities we audit to account for implementing the recommendations in our reports. The PAC also reviews the performance and operation of the Audit Office every four years.

What Parliament thinks of us

We strive to ensure parliamentarians value our work and that we meet their expectations. We continuously enhance our public sector knowledge to ensure our work is relevant and impactful. This is driven by the ‘Enhancing our impact, demonstrating our value’ strategic objective and will be considered during the development of our next Corporate Plan.

Each year we survey parliamentarians to get feedback on our reports and services.

In 2024, of the 135 parliamentarians invited to complete the survey, 25% responded, the same as 2022. There was no survey in 2023 as it coincided with the state election when participation was considered likely to be low.

The 2024 survey results were lower than previous years, and below our targets. In 2024–25 we plan to undertake more extensive engagement activities with parliamentarians to improve their satisfaction with our reports and services.

How we compare to other audit offices

Since 2005, we have compared our parliamentarian survey results against results from other participating Australian audit offices. On an overall measure of satisfaction with reports and services, 75% of parliamentarians were satisfied in 2024, compared to the 86% average of other participating audit offices. In terms of our reports and services providing valuable information on public sector performance, helping to improving public sector administration and our reports communicating issues clearly, we rated comparably to the average of other audit offices.

* Survey not conducted in 2023 due to election year.

• 6 appearances at parliamentary committee hearing

• 10 Parliamentary committee briefings

Public Accounts Committee

The Public Accounts Committee (PAC) is a statutory committee of the NSW Parliament’s Legislative Assembly that examines the government’s use of resources and agencies’ financial operations. It also looks at financial probity and regularity, and focuses on whether agency programs achieve their aims. The PAC reviews the Auditor-General’s reports to ensure that agencies respond appropriately to recommendations. The PAC also reviews the operation of the Audit Office every four years. Results of the PAC’s quadrennial review, tabled in Parliament on 21 September 2022, are available on its website.

The PAC is tasked with holding entities we audit to account for implementing audit recommendations. The PAC may hold a public inquiry to seek further information from agencies regarding our reports and can make further recommendations for action when it considers them necessary. This process has proven to be an effective means of assessing action taken on performance audits and maintaining a high level of responsiveness from the agencies under review.

In 2023–24 we appeared at the PAC’s inquiry into Accountability measures for decision-making for the delivery of major infrastructure, contracting of public services and/or the privatisation of public assets in NSW. On 24 October 2023, following publication of our performance audit of the Critical Communications Enhancement Program, tabled in June 2023, the committee resolved to consider the program as the initial focus of this inquiry.

• 99% of our financial audit recommendations accepted

• 95% of our performance audit recommendations accepted or agreed in principle

Improving public sector accountability and performance

Our audits identify opportunities for improving public sector accountability and performance. Our recommendations are reported to those charged with the governance of the entities involved and, for the more significant matters, to Parliament. Most entities agree to implement our recommendations.

Financial audit recommendations accepted

We track all financial audit recommendations made to the entities we audit. Our Internal Controls and Governance 2023 Auditor-General’s Report to Parliament covered the findings and recommendations from our 2022–23 financial audit reports that relate to internal controls and governance at the 25 largest financial entities in the NSW public sector, excluding state-owned corporations and public financial corporations. Of the 256 recommendations made to these entities, 99% were accepted, exceeding our target of 95%.

Performance audit recommendations accepted

During the conduct of performance audits, audit teams work constructively with audited agencies to develop recommendations that are relevant, timely, impactful and implementable. Of the 105 total performance audit recommendations made to audited entities, 95% were accepted either in full or in principle, exceeding our target of 80%.

• 93% value the recommendations to improve financial management and internal controls of their organisation

• 64% believe that the Audit Office's audit program was undertaken in a timely manner

Our relationship with auditees

The Audit Office audits state government entities, local government councils and universities in New South Wales. Although Parliament is our primary stakeholder, we work constructively to add value to the entities we audit, and ultimately to the citizens of New South Wales.

What financial auditees think of our services

Each year, we measure financial auditees’ satisfaction with our services through a survey. We use an independent research company to conduct the survey and auditees have the option of responding anonymously. The results and feedback provide valuable information on our performance.

In 2023–24, we invited agency heads or their delegates from state government, local government, and university auditees to participate in the survey. Response rates from agency heads was 67%, an increase from 59% in 2022–23.

Our overall agency heads’ performance index was 74, consistent with 72 last year. Our performance index across audit process, audit reporting and audit value was higher than last year. While we were pleased with the overall improvement, the results by sector were mixed. Auditees in the state and university sectors assessed our overall performance as better than the previous year. However our performance, particularly around audit process and audit value, dropped in the local government sector.

Feedback from auditees suggests we are doing well in the areas of auditor professionalism, clear and timely communication, and providing valued assurance and recommendations to improve the financial management and internal controls of auditees. Areas where we can improve are timeliness of the audit program, our understanding of the auditee, and demonstrating value for money in terms of audit fees.

We have developed a roadmap of planned actions to address the feedback we have received. Actions include delivering timelier audits by bringing work forward and being more transparent on how we set our audit fees, two of the lowest scoring areas in the survey.

• 14 performance audits completed

• 2 other assurance engagements undertaken

What is a performance audit?

Performance audits are in-depth assessments of whether government entities are effective, efficient and economical in the programs and services they deliver, and whether they are delivered in accordance with the law. A performance audit may cover the whole of an entity’s operations, one particular activity of an entity, or an activity across a number of entities.

We report the results of state government performance audits to the head of each audited entity, the responsible minister, and the Treasurer. We report the results of local government performance audits to each of the councils subject to audit, the Department of Planning, Housing and Infrastructure, and the Minister for Local Government. All reports are also tabled in NSW Parliament and published on our website. A list of all performance audits tabled in 2023–24 is available in Appendix four.

Helping to improve public administration

Performance audits provide information to the NSW Parliament and the public about how well government programs and services are delivered. Ultimately, they aim to improve public administration.

In 2023–24, the Auditor-General tabled 14 performance audit reports and one special insights report on the effectiveness, efficiency and economy of the NSW public sector. These reports made a total of 105 recommendations to improve public administration, and involved 33 audited agencies and local councils.

The reports looked at planning, operations, governance, service delivery and project implementation across a range of NSW government agencies and local councils. Some audits considered particular issues across a number of entities.

• 498 financial audits completed

• 677 other assurance reviews completed

• 1,175 in total

What is a financial audit?

Our financial audits provide independent opinions on the financial statements of NSW government entities, local councils and universities. Our opinions provide assurance about whether these financial statements comply with accounting standards, relevant laws, regulations and government directions. Financial statement audits also highlight opportunities where entities can improve their governance systems and internal controls.

Parliament needs to be assured that our audits are objective and of a high quality. Our mandate assures our independence by restricting us from providing non-audit services. We comply with professional quality and independence requirements.

Our financial audit base

This year, we completed 497 financial audits of NSW state, local government and university entities, the same as last year. The entities we audit cover a diverse range of services and vary in size from large government departments, universities, state superannuation entities and utilities, and local and county councils, to small boards and trusts. A full list of entities we audited during this period is available on our website.

We also provided 677 other assurance audits and reviews (668 last year), most of which were acquittals or attestations of compliance.

Total State Sector opinion

In addition to the 497 audits of individual state, university and local government entities, we audit the Total State Sector and General Government Sector Accounts. These accounts are the consolidated whole-of-government financial statements of the NSW Government tabled in Parliament.

• 75% employee engagement

• 95% of employees feel their manager supports flexible working in their team

Survey participation high

In 2023–24, 84% of our employees participated in the NSW public sector People Matter Employee Survey, down from 89% last year. Given the survey was conducted during our busy period, we were pleased with our participation rate this year.

Engagement and job satisfaction remains steady

Employee engagement was 75%, the same result as 2022–23, but below our target of 80%. This result is ten percentage points above the NSW public sector. Job satisfaction remained high at 76%, consistent with 74 last year.

• 337 full-time equivalent employees

• 12% employee turnover, within our target of 12–15%

Employee turnover within our target

Our brand, reputation and opportunities for professional and career development help us attract and retain high-quality employees. This positively impacts our ability to sustain a regular supply of specialist talent, as well as our capacity to meet auditee needs.

We experienced a 12% employee turnover in 2023–24, an increase from 11% in 2022–23 and a return to our target range of 12 to 15%.

We gathered feedback from 84% of employees who exited the Audit Office. Of these employees, 58% reported they resigned due to a career change, and 42% for other reasons such as study, travel, a sabbatical or a career break. Some of the feedback gathered in exit surveys revealed employees:

• appreciated the people and found the Audit Office to be a friendly place to work
• felt supported within their teams
• appreciated the work-life balance and flexible working arrangements on offer.

It also suggested improvements such as having more opportunities to build connectedness in the workplace, and adjusting the allocation of workloads, staff rotation and resourcing during busy periods.

Of the employees who resigned in 2023–24, 42% moved elsewhere in the public sector and 18% moved to the private sector.

• 7 training days per employee

• 65 employees supported through our study support program

Well‑developed skills

Our learning and development program is contemporary and flexible, building skills and capabilities for now and in the future. It is designed to enable employees to further their career at the Audit Office as well as more broadly across the NSW public and private sectors.

A core part of our learning program occurs on the job. Throughout the year, subject matter experts delivered training on key technical skills and new software. Employees also accessed a range of self-paced online programs, and instructor-led external courses, seminars and conferences delivered virtually and in person.

In 2023–24, our program included training on corruption prevention for managers, practice management, matter planning, managing for team wellbeing, and maintaining wellbeing in periods of peak demand. Our data champions attended advanced training on a data visualisation tool and targeted training on an audit-specific data analytics tool. We continued to partner with an Aboriginal-owned business to deliver face-to-face cultural capability training.

Compliance training for all employees included:

• gifts, benefits and hospitality
• behaving ethically and the code of conduct
• cyber security awareness
• social media
• work health and safety
• fraud and corruption control
• understanding modern slavery.

In addition to the above, compliance training for all new hires included training on diversity and inclusion, Aboriginal cultural competency, disability awareness, and respectful workplace.

In 2023–24, we continued to offer a diverse range of development opportunities, including external secondments, internal transfers and opportunities to act at higher levels, and all employees had access to a wide array of online courses.

We remained committed to offering external development experiences, seconding one employee to the Department of the Legislative Assembly and two to the Solomon Islands Audit Office.

Technical development

In 2023–24, financial audit employees were upskilled in a range of technical subject areas including audit methodology, accounting standards, client interview and communication skills, legislation, professional scepticism, and training for financial and data analytics systems. They were also supported to attend professional accounting, auditing and superannuation conferences.

Performance audit employees attended relevant industry conferences and Australasian Council of Auditors-General (ACAG) practice-sharing events. New team members attended an introduction to performance audit training conducted by ACAG subject matter experts. Some performance audit staff also attended training in distilling audit findings, and root cause analysis facilitated by the Canadian Audit and Accountability Foundation (CAAF).

Upskilling for the future

Upskilling our staff in emerging trends helps ensure we are future ready. This year we invested in the education of our employees in contemporary topics such as cyber security and artificial intelligence. This included the delivery of a comprehensive workshop for our leadership team on artificial intelligence. The workshop covered the fundamentals of how artificial intelligence works, as well as important considerations for implementing artificial intelligence solutions, such as governance, ethics and risk. The course enabled our leaders to understand the potential and limitations of artificial intelligence, how to apply it in a strategic and ethical manner, and how to lead their teams to use it effectively and responsibly.

Supporting further education

We continued to help our people gain professional accounting qualifications by reimbursing 100% of fees and providing study leave. We supported 65 employees towards their professional qualifications, with 24 becoming fully qualified Chartered Accountants, three becoming Certified Practising Accountants, one becoming a member of the Institute of Public Accountants, and another becoming a member of the Association of Chartered Certified Accountants during the year.

We continued to support employees in other tertiary education and formal certifications by paying a percentage of fees for studies relevant to their current or future role, our organisation, or the public sector. Approved employees were also granted study leave to maximise their potential for success. In 2023–24, we supported eight employees to study across a broad range of disciplines, and two obtained their qualification.

We also approved support for two employees to complete accredited tertiary education and a formal qualification which were deemed essential to the strategic capability needs of the organisation. Support is provided through the reimbursement of 100% of fees and the provision of study leave.

Leadership development

In 2023–24, we continued implementing and investing in our Leadership Development Framework to support the Building capability for the future strategic objective. We continued to roll out the Leadership Essentials program and the Public Service Commission’s People Management Fundamentals course.

New managers completed disability awareness, respectful workplace, and managing for team wellbeing training. We supported six employees to attend formal leadership courses through our sponsored leadership program. This included five female leaders who attended a strategic leadership program, and one female leader who completed a company directors course. We continue to partner with an independent think tank, enabling our leaders to attend events with other government and private sector leaders.

Investment in development increased

In 2023–24, we delivered an average of seven training days per employee, less than last year’s eight days but in line with our target. We increased our learning and development investment, with $1,116,000 invested in developing our employees, up from $908,683 last year. This increase was targeted at leadership development.

• 99% Technology systems availability kept at 99% target

• Core business legacy systems transformed into contemporary cloud solutions

Enhancing technology and systems

In 2023–24, we enhanced audit delivery through the successful completion of two major projects which modernised our core audit management systems and processes. We also continued to evolve our cyber resilience by introducing new controls and defences. Our technology achievements include:

• transitioning to a contemporary cloud-based audit management software platform enabling the business to take advantage of more frequent feature releases, improved processes and a more resilient, secure platform
• replacing our legacy records management system with a modern cloud-based collaboration platform with in-place record management – providing a strong foundation for innovation and process improvements
• implementing an audit communication portal to support the audit process for auditors and auditees – the web-based portal is tailored to the Audit Office's needs and provides visibility and process management
• introducing a new policy to guide how we manage risks and maximise opportunities associated with the use of AI technology
• initiating a pilot of an artificial intelligence tool
• improving third-party risk management by optimising the risk assessment process including right sizing the inherent risk to better inform the downstream process
• enhancing workplace technology to better support flexible working including improved meeting room AV capabilities
• assessing the requirements for the new ISO27001:2022 standard and NIST Cyber Security Framework v2.0
• introducing a red team exercise to provide improved insight into our cyber detection and response capability
• establishing a process to identify and manage the risks associated with employees working on Audit Office devices while overseas.

We continued to meet compliance and operational stability requirements by:

• renewing our ISO27001:2013 security certification and increasing our alignment to the NIST Cyber Security Framework
• adhering to the requirements of the NSW Cyber Security Policy
• uplifting our Australian Cyber Security Centre’s ‘Essential Eight’ controls to meet new maturity requirements and reporting on our maturity
• maintaining systems availability above our target of 99%
• reviewing and testing our business continuity plan, disaster recovery plan and cyber security incident response
• completing an annual penetration test and cyber incident exercise
• increasing staff awareness by providing mandatory cyber training and conducting a phishing exercise.

• 100% of audit opinions reviewed through the quality assurance program were supportable

• 4 submissions made to professional bodies

Our System of Quality Management

Our System of Quality Management (SQM) is an important mechanism to ensure that Audit Office employees, and Audit Service Providers (ASPs), comply with Australian Auditing Standards, relevant ethical requirements, and applicable legal and regulatory requirements. It also ensures our reports are appropriate in the circumstances.

Our SQM aims to demonstrate the Audit Office’s compliance with:

• ASQM 1 Quality Management for Firms that Perform Audits or Reviews of Financial Reports and Other Financial Information, or Other Assurance or Related Services Engagements
• ASQM 2 Engagement Quality Reviews
• ASA 220 Quality Management for an Audit of a Financial Report and Other Historical Financial Information.

An annual evaluation of our SQM was performed for the year ended June 2024, as required by ASQM 1, to assess if there were any deficiencies impacting the effectiveness of the SQM. One deficiency was identified in relation to our SQM and several ASPs identified some deficiencies. We will monitor the ASP’s remedial actions in 2024–25 to ensure all identified deficiencies are adequately addressed. Notwithstanding these deficiencies, the audit file reviews across the audits we conduct and those from our ASPs, found that the reports we issued are appropriate in the circumstances.

Quality Audit Review Committee

Our Quality Audit Review Committee monitors the quality of audit products and provides the Auditor-General with assurance that the Audit Office complies with the requirements of ASQM 1, ASQM 2 and ASA 220.

The Quality Audit Review Committee consists of an independent chair (an experienced external member from the profession) and the deputy auditor-general. Two other experienced and qualified internal practitioners, as well as representatives from the Professional Services Branch, are standing invited attendees.

Audit file quality reviews

We recognise the importance of audit quality in achieving our vision. Audit quality is supported through the Audit Office’s comprehensive quality assurance program and annual reviews of the quality of our financial and performance audits. Quality reviews consist of cold reviews where files are reviewed on audit completion and hot reviews where targeted aspects of files are reviewed while audits are in progress.

Financial audits

The quality review program for financial audits covers the audits we conduct and those resourced with an ASP.

This year, we continued the engagement of a professional services firm to review some financial audits conducted internally, with the objective of benchmarking our quality review and audit practices with others in the profession.

During 2023–24, our quality review program included cold reviews as well as limited scope hot reviews of financial audits where the review focused on specific aspects of the audit file. A pilot review of an Auditor-General’s Report to Parliament was also undertaken. The cold reviews found the assurance opinions were supportable.

Performance audits

During 2023–24, a performance audit cold review was conducted. The review found that the assurance report for the reviewed audit was supportable.

The results of the financial and performance audit reviews conducted under our quality review program were reported to the Quality Audit Review Committee. The committee is responsible for ensuring the process, conclusions and any remedial actions are communicated to the Auditor-General, the Audit and Risk Committee, the Office Executive, audit teams, and our ASPs. Quality findings inform the Audit Office’s learning and development program to promote an environment of continuous improvement.

In 2024–25, the quality review program will include cold and limited scope hot reviews for both financial and performance audits.

External quality reviews

External reviews provide important scrutiny of theAudit Office’s quality management systems and processes, and help benchmark their effectiveness.

The Audit Office is subject to, or has participated in, the following reviews of our audit quality system:

• a quadrennial review by a person appointed by Parliament’s Public Accounts Committee to examine the auditing practices and standards of the Auditor-General. The most recent 2021–22 review concluded that we conduct audits in compliance with the professional standards and under the then Public Finance and Audit Act 1983 and the Government Sector Audit Act 1983, and that the Audit Office is a well-functioning office that is staffed by professional and dedicated auditors
• periodic peer reviews of aspects of the Audit Office arranged under a Quality Assurance Framework, sponsored by the Australasian Council of Auditors-General. No peer reviews were conducted during 2023–24.

Ensuring the quality of our Audit Service Providers

Our ability to deliver quality audits is influenced by those we work with – our external Audit Service Providers (ASPs). Our ASPs are required to comply with Audit Office policies, including those related to managing independence, conflicts of interest, and other audit-related policies. They are also subject to our quality assurance reviews. The proactive supervision of our ASPs ensures the work they deliver for each audit achieves the required audit quality.

Technical Issues Committee

To maintain audit quality, we have a robust process to deal with complex or significant accounting, audit or legislative compliance matters that our financial auditors encounter. The Technical Issues Committee (TIC) is responsible for considering these matters and making recommendations to the Auditor-General on the inclusion or removal of modifications to our auditor’s reports, including:

• key audit matters in our independent auditor’s report for the consolidated state financial statements or other auditees if referred to the TIC
• retrospective restatements and accounting treatments of complex, contentious or significant accounting issues
• auditing issues which may set a precedent or affect a range of our auditees.

The TIC is a forum where technical issues are debated to enhance audit quality. It is chaired by the deputy auditor-general, provided technical support by the Professional Services Branch and comprised of internal stakeholders, including:

• senior financial audit executives
• independent representatives from the business
• the director of the Total State Sector Accounts’ audit
• representatives from relevant audit teams
• the executive director professional services or delegate.

The TIC considers the technical merits of contentious matters, the views of external parties, peak bodies and central agencies, and practices in other jurisdictions. Accordingly, technical matters are considered in detail and from multiple perspectives. In 2023–24, the TIC met 39 times to advise on complex matters.

Safeguarding our independence

Independence is fundamental to fulfilling our mandate. We have robust policies to safeguard our independence, including requirements to declare conflicts of interest and mandating maximum periods that senior audit team members can work with auditees.

The Audit Office has two important policies (one for Audit Office employees and one for ASPs) to address how other engagements are accepted. These policies have a range of protections to ensure we only accept (or approve ASPs to accept) other engagements that do not compromise independence.

Legislation does not permit us to perform non-audit services (such as consulting or advisory work) to auditees. Our policies allowed ASPs to deliver some non-audit services to our auditees, up to September 2023. These policies envisaged limited circumstances where this would occur and had safeguards in place to manage such situations. This included a requirement for ASPs to seek our approval before being engaged to deliver additional services. We approved these requests only after we had conducted a rigorous assessment to ensure the independence of the Audit Office and ASPs was preserved. From September 2023, our policies no longer allow ASPs to deliver non-audit services to our auditees.

Our mandate under the Government Sector Audit Act 1983 and Local Government Act 1993 permits us to perform additional assurance work, such as grant acquittals. This can be requested by the Treasurer, a minister, councils, the Secretary of the Department of Planning, Housing and Infrastructure, or both Houses of Parliament. The Government Sector Audit Act 1983 requires the Parliament, Treasurer or a minister to consult with the Auditor-General about the scope of the additional assurance work before requesting the Auditor-General to perform the work.

Before undertaking these engagements (or approving ASPs to do so), we evaluate the appropriateness of the work. We monitor compliance with these policies and our approach to undertaking (or approving ASPs to undertake) other engagements to ensure our independence is beyond reproach.

To safeguard our independence, we foster a culture that instils high standards of conduct and ethical behaviour. This includes a requirement for all employees to complete a conflict of interest and professional independence declaration as outlined in the Audit Office's Conflict of Interest and Professional Independence Policy when they commence at the Audit Office, and annually thereafter. Employees must also report a new, or change to an existing, conflict of interest or threat to independence as soon as they become aware of it and obtain pre-approval before commencing secondary employment or voluntary work.

The Audit Office has a detailed Gifts, Benefits and Hospitality Policy. Employees must declare all gifts, benefits and hospitality valued over $25, regardless of whether it was accepted or declined. We report all gifts, benefits and hospitality valued over $25 in a register that is publicly available on our website. See Governance | Ethics for more information.

Transparent quality reporting

The Corporations Act 2001 includes requirements for annual transparency reporting by auditors. Although the Audit Office is not subject to these requirements, we have embraced the transparency reporting principles. For our 2023–24 Annual Report, Appendix six summarises the requirements that are relevant to the Audit Office and shows where the required information is presented in this report.

Building capability

To deliver quality audits we must support the capability of our people. We have a comprehensive learning and development program that ensures we continuously build the capabilities and knowledge of our people. The program focuses on audit quality, including core accounting, auditing and legislation technical competencies, and includes non-technical competencies such as professional scepticism and use of professional judgement, external stakeholder management, presentation and writing skills.

Influencing quality internationally

In 2023–24, we assisted the Australian National Audit Office to arrange and host two staff secondments from the Audit Board of the Republic of Indonesia, BPK Republik Indonesia (BPK). These secondments allowed BPK’s staff to work with our financial audit teams to gain practical insights and on-the-job experience in applying a contemporary audit methodology, and auditing financial statements prepared using accrual accounting. This activity was funded by the Australian Department of Foreign Affairs and Trade (DFAT).

We extended this knowledge sharing through our ‘twinning’ relationship with the Solomon Islands Office of the Auditor General (SIOAG), also funded by DFAT, which builds SIOAG’s capacity to perform its audit functions. The current three-year twinning arrangement is for the years 2023–2025. Two secondments to Solomon Islands occurred during 2023–24. One employee worked as an executive officer of the SIOAG in the delivery of its provincial audit portfolio, while another employee was focused on the statutory body portfolio.

The Audit Office is a member of the Pacific Association of Supreme Audit Institutions (PASAI), the official association of supreme audit institutions in the Pacific region. PASAI seeks to promote transparent, accountable, effective, and efficient use of public sector resources in the Pacific.

This year, we attended the PASAI Congress in the Cook Islands. The Auditor-General addressed attendees, sharing views on how to strengthen professionalism, and considering what the future workforce will look like and what training is required now to prepare for that. The assistant auditor-general of the Systems, Assurance, Cyber and Data Branch presented on using technology for improved audit outcomes, and the director of People and Culture presented on how human resource strategies can improve governance.

Additionally, representatives from our Corporate, Experience and Strategy Branch supported the PASAI HR Champions Program across several online sessions, on the topics of developing a human resources strategy, and diversity and inclusion.

Promoting quality through ACAG

The Audit Office is an active participant in the Australasian Council of Auditors-General (ACAG), established in 1993 to encourage sharing and cooperation between Australian audit offices. In 2023–24, we participated in and supported various ACAG subgroups.

The Auditor-General for New South Wales began a two-year term as chair of the ACAG Audit Analytics Committee on 1 July 2024, with the Audit Office of New South Wales also providing secretariat support.

We also contribute to the collaborative efforts of Australian audit offices by helping develop responses to professional bodies on pronouncements exposed for comment. In 2023–24, we prepared or contributed to four ACAG responses to standard setters (see Appendix three for further details).

• 89% of state and university financial audit opinions issued within four months of agencies financial year-end

• 65% of local government financial audit opinions issued by 31 October 2023

Timeliness of issuing financial audit opinions

Parliament and other stakeholders need timely reports to allow prompt scrutiny of government entities’ financial information. Of our opinions for state and university auditees, 89% were issued no later than four months after the auditees’ financial year-end, down from 96% in the previous year. This timeframe aligns with the NSW Treasury directive that requires us to audit the financial statements as soon as practicable.

In 2023–24, we provided 65% of audit opinions for local government entities by 31 October 2023, up from 60% in the previous year. Our timeliness in issuing audit opinions was impacted by several local government entities obtaining approval from the Office of Local Government to complete their financial statements and audit process by a later date.

We have several initiatives underway to improve the timeliness of our financial audits including bringing more audit work forward, an area of improvement called out by auditees in the annual survey.

Timeliness of our performance audits

Our average time to complete performance audits was 11 months, a decrease from last year’s average of 13 months. The average time to complete an audit is less than the average of 12 months taken by all Australian audit offices that participate in the Australasian Council of Auditors-General (ACAG) macro benchmarking. We continue to look for opportunities to implement efficiencies in processes to ensure the timely delivery of our reports.

Formal Office Executive meetings attended

A total of ten formal meetings held.

* Bola Oyetunji’s term as Auditor-General commenced on 4 April 2024.
** Margaret Crawford’s term as Auditor-General ended on 3 April 2024.
*** Ian Goodwin left the Audit Office on 14 June 2024.
**** Michael Thistlethwaite attended two formal Office Executive meetings in May and June 2024 when acting in the role of assistant auditor-general.
***** Renee Meimaroglou attended two formal Office Executive meetings during March and April 2024 when acting in the role of assistant auditor-general.

Strong governance foundations

Governance processes and behaviours guide us to achieve our purpose, conform to all relevant laws, standards and directions, and meet public expectations of probity, accountability and transparency. They provide our employees with a clear sense of purpose and focus, guiding their behaviour when dealing with each other, parliamentarians and auditees.

Our governance framework reflects the eight core Australian Securities Exchange (ASX) Corporate Governance Principles (4th edition). We use these eight core principles to develop, manage and report on our governance arrangements as detailed below.

ASX Principle 1: Management and oversight

Our Corporate Plan

Our Corporate Plan 2020–2024 was developed to help us achieve our vision and meet the strategic priorities of the Audit Office. Our Corporate Plan is summarised in the Strategy section.

ASX Principle 2: Structure

Structured to add value

The Audit Office has a well-defined governance structure consisting of its key committees: the Office Executive, independent Audit and Risk Committee, and externally chaired Quality Audit Review Committee and Remuneration Committee. To support the Office Executive there is also a:

• Strategic Technology Committee
• Finance and Performance Committee
• Diversity Committee
• Learning and Development Committee
• Quality Audit Review Committee
• Flexible Work Practices Committee
• Technical Issues Committee
• Work Health and Safety Committee
• steering committee for each significant project.

Office Executive

The Office Executive directs the affairs of the Audit Office and is responsible for:

• setting a clear strategic direction and monitoring performance
• overseeing the delivery of key strategic projects
• establishing and monitoring strategic key performance indicators
• defining the organisation’s Risk Appetite Statement and ensuring strategic risks are identified, assessed and treated appropriately
• developing the forward Annual Work Program 2024–27
• monitoring assurance over the Audit Office’s key processes including internal and external audit, Quality Audit Review Committee reviews, quality assurance peer reviews, and Public Accounts Committee reviews
• monitoring compliance with relevant laws, directions, codes and practices, and periodically reviewing Audit Office policies
• role modelling and embedding a culture of ethical and lawful behaviour
• overseeing the Audit Office’s financial performance and sustainability.

The Office Executive consists of the Auditor‑General as chair, the deputy auditor‑general, assistant auditors‑general from Financial Audit, Performance Audit and Systems Assurance, Cyber and Data and executive directors from Corporate, Experience and Strategy, Finance and Performance, and Professional Services. The chief audit executive and chief risk officer also attend monthly meetings.

Key focus areas for the Office Executive during 2023–24 included:

• overseeing the implementation of our Corporate Plan 2020–2024 and core projects
• developing an Annual Work Program 2024–27 of key audit focus areas for the year ahead, incorporating relevant challenges faced by the public sector, and utilising the follow-the-dollar powers passed by the NSW Parliament
• monitoring cyber security and data governance
• monitoring the Audit Office’s strategic risks, internal controls and environmental pressures, to ensure risks are at acceptable levels
• overseeing the System of Quality Management and monitoring the delivery of quality products
• continuing the considered adoption of new technologies to improve business operations and gain greater insights through our audits
• continuing to recognise the value of our people, championing their development, focusing on wellbeing and harnessing our employee value proposition
• overseeing the introduction of new standards and legislation.

Further details on our Office Executive including how it is structured are in the Office Executive section, and its charter can be found on our website.

Audit and Risk Committee

The Audit and Risk Committee (ARC) provides oversight and review of the Audit Office’s governance, risk management, compliance and external accountability requirements.

We assessed the committee’s 2023−24 activities to confirm compliance with Treasury’s Internal Audit and Risk Management Policy for the General Government Sector (TPP 20‑08). A copy of the Internal Audit and Risk Management Attestation is at Appendix five. The committee’s charter, and an annual report of the committee’s
activities, can be found on our website.

The committee generally consists of three independent members, although in 2023–24 the committee had four members for a short period to ensure adequate handover and onboarding of a new member. The committee consisted of Bruce Turner AM (Chair), Elizabeth Gavey, the incoming Lee Sullivan and the outgoing John Gordon. The independence, integrity and experience of committee members are key strengths, providing insight and enhancing our operations.

Bruce Turner AM brings extensive ARC experience within the state government and not‑for‑profit sectors, as well as audit, risk and improvement committees in the local government sector. Bruce also held chief audit executive roles in large and diverse state and federal government agencies and currently serves on several ARCs. Bruce’s final four-year term on the Audit Office’s ARC ends on 16 February 2025.

John Gordon is a Chartered Accountant with over 40 years’ experience providing assurance, advisory and corporate governance assistance to a broad range of clients in the private and public sectors. This includes 22 years as an audit and assurance partner with PwC Australia until retiring in 2008. Since 2009, John has served as an ARC chair or member of more than 25 ACT, NSW state and local government agencies. He currently serves on several NSW state government and local government ARCs. John completed his term on 30 June 2024.

Elizabeth Gavey is a qualified solicitor with over 30 years’ experience in commercial law, investment banking and the health sector. She currently serves on several ARCs in the state and local government sector. Elizabeth’s current three-year term on the Audit Office’s ARC ends on 28 August 2024 and has been extended for another three years.

Lee Sullivan joined our ARC on 1 February 2024. Lee brings a wealth of experience as a Chartered Accountant and member of the Institute of Internal Auditors, having had roles as head of corporate governance, company secretary, chief audit executive and chief risk officer in the financial services and insurance industry. Lee is currently the Chief Risk Officer at Minter Ellison, and a member of ARCs of other NSW government entities. Lee’s three-year term ends on 31 January 2027.

The Auditor-General, deputy auditor-general, chief financial officer, chief audit executive, chief risk officer, internal and external auditors, and management representatives attend ARC meetings. The committee meets independently, without management, with internal and external auditors, the chief audit executive and chief risk officer, at least once a year, and meets with the Auditor-General and deputy auditor-general prior to each meeting.

Committee members provide written conflict of interest declarations to the Auditor-General annually, and these are verbally confirmed at the start of each meeting. No conflicts of interest were declared that prohibited the continuing engagement of members.

Audit and Risk Committee meetings attended*

A total of six meetings held, including one special meeting to review the annual financial statements and one to review early close financial statements.

* Individual committee members sit on various boards and ARCs for councils, Commonwealth and state government agencies, not for profit, and public companies. These memberships are captured and appropriately managed on a conflict of interest register.
** John Gordon completed his term on 30 June 2024.
*** Lee Sullivan's term commenced on 1 February 2024.

Quality Audit Review Committee

Our Quality Audit Review Committee monitors the quality of audit products and provides the Auditor‑General with assurance that the Audit Office complies with the requirements of ASQM 1, ASQM 2, and ASA 220. See Process | Quality for more information on these standards and the Quality Audit Review Committee.

The committee consists of an independent external member – Denis Thorn – and the deputy auditor-general. In 2019, Denis was appointed to chair the committee for an initial four‑year term. In 2023, this term was extended for an additional four years to November 2027. Denis has extensive experience providing assurance and advisory assistance in the private and public sectors as a former partner with EY. He now provides advice on audit quality and expert witness reports to public and private sector clients.

Remuneration Committee

The Remuneration Committee, with an independent chair, provides advice on the appropriateness and application of the Audit Office’s remuneration policies and procedures. More information on the Remuneration Committee can be found in the Governance | Disclosure section.

Strategic Technology Committee

The Strategic Technology Committee provides advice to the Office Executive regarding the strategic direction, operational decisions and investment in information technology, business systems and cyber security. The committee also provides advice on managing information and technology‑related organisational risks.

Finance and Performance Committee

The Finance and Performance Committee provides advice to the Office Executive regarding the strategic financial direction and financial sustainability of the Audit Office. The committee also oversees the organisation’s financial management framework, the management of financial risks, organisational efficiency, and performance against key measures of success.

Diversity Committee

We embrace and celebrate our diversity by delivering key areas identified in the Diversity, Inclusion and Accessibility Roadmap. The Diversity Committee leads, advocates for, coordinates, informs and monitors the Audit Office’s Diversity, Inclusion and Accessibility Framework and roadmap of activities. The roadmap is developed using input from representatives with lived experience before being considered by the Diversity Committee.

Flexible Work Practices Committee

The Flexible Work Practices Committee monitors the effectiveness of our Flexible Work Practices Model and makes recommendations to the Office Executive to ensure the model remains fit for purpose in the long term. The committee is responsible for seeking feedback, and considering ways to adapt the model to changing work requirements, including auditee and employee needs and stakeholder perspectives.

Clear and consistent project governance

Strong project governance helps us deliver our strategic objectives and achieve our purpose. Our Project Management Framework ensures we have a consistent approach to the projects we undertake. It outlines project management principles and highlights systems, tools and processes important to the successful delivery of our projects. During the year, an internal audit of the Project Management Framework concluded that the structure and accountabilities within the framework are fit for purpose and capable of delivering the stated project objectives and program of works.

ASX Principle 3: Ethics

High standards of conduct are instilled

Protecting the reputation of the Audit Office is vital to ensure our credibility and maintain public trust in what we do. To do this, we foster a culture that instils ethical behaviour supported by a clear Code of Conduct. Our ethical and lawful framework includes policies covering:

• conflicts of interest and professional independence
• gifts, benefits and hospitality
• fraud and corruption control
• diversity and inclusion
• respectful workplace
• compliance
• performance management
• privacy management.

During induction, new employees are trained on the Audit Office’s ethical and lawful framework before signing the Code of Conduct and completing a conflict of interest and professional independence attestation. These sign‑offs are completed annually thereafter.

Our Statement of Business Ethics provides key principles that underpin our business relationships and sets expectations that third parties who work for or on behalf of the Audit Office will act in accordance with the highest possible standards of conduct and ethics. Our Audit Service Providers’ manual and contracts require adherence with the principles set out in the statement.

In 2023–24, we:

• revised the Code of Conduct and related training which was completed by all employees
• ensured all employees completed the annual conflict of interest and professional independence attestation
• published the Audit Office’s Gifts, Benefits and Hospitality Register for transparency.

In 2023–24, we had a suspected breach of the Code of Conduct that required external notification of reportable allegations to ICAC. There were no other breaches or incidents that required external notifications of reportable allegations or substantiated misconduct in accordance with the relevant statutory provisions, as outlined in the Disciplinary Policy.

Protecting privacy

The Audit Office is committed to protecting individual privacy and managing personal information in accordance with the Privacy and Personal Information Protection Act 1998 and the Health Records and Information Privacy Act 2002. The Audit Office’s Privacy Management Plan was updated in March 2024 and sets out how we manage personal and health information in line with these obligations.

The Audit Office’s Data Breach Management Policy outlines our approach to managing data breaches. The policy was updated in November 2023 to incorporate new mandatory notification requirements in the case of an eligible data breach under the Privacy and Personal Information Protection Act 1998. The policy is also consistent with guidance issued by the NSW Information and Privacy Commission on data breach management. Notifiable breaches are those that involve:

• a breach of personal information that is likely to result in serious harm to an individual (an ‘eligible breach’), which must be reported to the Privacy Commissioner and certain individuals, and published on the Audit Office’s public register
• a tax file number if the data breach may result in serious harm to an individual, which must be reported to the Office of the Australian Information Commissioner
• incoming technology cyber intrusions or breaches that risk the integrity and protection of state agencies, which are reported to Cyber Security NSW.

The Audit Office participated in the Office of the Australian Information Commissioner’s ‘Privacy Awareness Week’ in May 2024. The purpose of this engagement was to encourage awareness within our organisation about privacy issues and the importance of protecting personal information.

During 2023–24, nine incidents were dealt with under the Data Breach Management Policy. All were satisfactorily resolved in line with established procedures, and none were notifiable breaches.

Prevent, detect and respond to fraud and corruption

The Audit Office is committed to embedding an honest and ethical environment that minimises the risk of fraud and corruption. Fraud and corruption are incompatible with our values and the Code of Conduct and can cause serious reputational damage. For these reasons the Audit Office has zero tolerance for fraud and corruption. During 2023–24, we:

• completed the fraud risk assessment and updated the fraud and corruption control plan
• commenced a self-assessment against the Assessing Corruption Control Maturity guide, ICAC NSW
• supported the internal audit function and contributed to the completion of a fraud and corruption control framework review
• completed the annual fraud and corruption control checklist.

In 2023–24, one case of suspected fraudulent conduct by an Audit Office employee required external notification as a reportable allegation to ICAC (the same case identified as a suspected breach of the Code of Conduct listed above). An internal investigation was conducted in accordance with our Fraud and Corruption Control Policy and our internal processes were tightened. There were no other reports of fraudulent or corrupt conduct.

Compliance management

The Audit Office has many compliance obligations relating to legislation, central agency directions, standards and codes. To meet these obligations, our compliance program promotes the importance of compliance to all employees and assists our people to identify obligations and respond to non‑compliance.

The Audit Office’s compliance framework is a robust mechanism that ensures we meet our compliance obligations. The framework is based on Australian Standard AS ISO 37301:2023 Compliance Management Systems – Requirements with guidance for use, and includes:

• a commitment by the Office Executive to promote and instil a compliance culture
• a Compliance Policy
• a Register of Compliance Obligations, incorporating a risk assessment formally reviewed by the Office Executive
• annual certification of compliance through the Management Control Questionnaire
• financial and performance audit methodologies mapped to professional standards and legislation
• annual management review of the compliance management system.

In 2023−24, a program of work was undertaken to implement internal audit recommendations aimed at reducing compliance risks in a hybrid working environment. Enhancements were also made to the Audit Office’s Policy Framework to support compliance through human-centered policy design that is inclusive and accessible, and fit
for purpose in a flexible, hybrid working environment.

Overall, our approach to compliance management continued to be supported by the structure and responsibilities within the Professional Services Branch who:

• monitor potential legislation changes and alert those responsible for compliance within their respective roles or responsibilities
• provide advice and facilitate the understanding of legal matters impacting the Audit Office
• perform and coordinate quality reviews of our audit practice including checking compliance with Australian auditing standards, relevant ethical requirements, and applicable legal and regulatory requirements
• follow up on compliance with internal audit recommendations
• conduct a compliance review and risk assessment across the organisation.

ASX Principle 4: Corporate reporting

The integrity of Audit Office financial and corporate information is safeguarded by several mechanisms that provide independent assurance over how well our processes operate and comply with relevant laws, standards and policies.

Financial reporting

The Audit and Risk Committee provides an independent review of the objectivity and reliability of the Audit Office’s financial information, and ensures our financial statements are supported by appropriate management sign‑off on the adequacy of internal controls. Finance reports are presented for review at each Audit and Risk Committee meeting, and special meetings are held to review our annual financial statements.

Auditor-General certification

The Auditor‑General certifies that the Audit Office’s financial statements:

• are prepared in accordance with applicable Australian Accounting Standards, the Government Sector Finance Act 2018, the Government Sector Finance Regulation 2024 and the Treasurer’s directions
• present fairly the Audit Office’s financial position, financial performance and cash flows.

This certification is supported by the designated chief financial officer’s annual letter of certification as to the effectiveness of the system of internal control over financial information.

External audit

Pursuant to section 47 of the Government Sector Audit Act 1983, the Governor of New South Wales appoints an independent audit practitioner to audit the Audit Office’s financial statements. The external auditor provides an independent opinion on whether our financial statements are true, fair, and comply with applicable Australian Accounting Standards. The external auditor also attends all Audit and Risk Committee meetings.

Internal audit

Designed to add value and improve operations, our internal audit function provides independent and objective assurance and advice to the Audit and Risk Committee, the Office Executive and senior management. The internal audit function complies with the requirements of TPP 20-08 Internal Audit and Risk Management Policy for the General Government Sector.

The internal audit function, led by the chief audit executive and supported by employees and an external service provider, brings a systematic, disciplined approach to evaluating and improving our organisational systems, processes and reporting. The chief audit executive reports on the progress of the annual internal audit program at each quarterly Audit and Risk Committee meeting, supported by presentations from the service provider on the findings of their reviews.

The internal audit plan is a risk-based, rolling three-year plan. It is refreshed annually to ensure it remains current and relevant, and that it responds to changes in our environment and operations, current and emerging risks, and impacts from our Corporate Plan and strategic objectives. It also considers other independent reviews
captured in the assurance map.

In 2023–24, our internal audit program included the conclusion or commencement of reviews on the:

• effectiveness of our compliance framework in a hybrid environment
• design effectiveness of our Project Management Framework
• adequacy and effectiveness of our fraud and corruption control framework
• design efficiency and operating effectiveness of our recruitment processes.

The internal audit program for the Audit Office’s Information Security Management System (ISMS) was also refreshed to maintain a series of ISMS audits at planned intervals consistent with requirements of the ISO/IEC 27001: Information security, cybersecurity and privacy protection.

The completed reviews resulted in 18 risk-rated recommendations, as well as a number of improvement opportunities. With a focus on risk-rated findings, implementation of all recommendations from internal audits and independent reviews are actively monitored. Progress on the implementation of recommendations is reported three times per year to both the Office Executive and the Audit and Risk Committee. A dashboard on the status of recommendations has continued to provide visibility and oversight of progress and emerging trends.

A quality assurance and improvement program is maintained for our internal audit function that ensures conformance with professional internal auditing standards. As part of that program, we continued implementing the improvement opportunities and good practice suggestions made in the 2023 external quality assessment of the internal audit function undertaken by the Institute of Internal Auditors (Australia).

Performance reporting

In 2023–24, performance against our Corporate Plan was reported to the Office Executive quarterly. A reporting dashboard provides an overview of key performance information for each objective, upcoming priorities, and current or emerging risks and mitigation strategies.

Regular financial and operational reports were presented to the Office Executive, financial audit executive and performance audit executive to monitor audits and related reporting. We also regularly reported on the performance of our corporate functions.

ASX Principle 5: Disclosure

Open access information

The Audit Office holds a significant amount of government information. Most of the government information deals with conducting our audits and reporting to Parliament. We also hold a smaller amount of information dealing with administrative matters. Certain government information is made available to the public under the ‘open access’ provisions of the Government Information (Public Access) Act 2009 (GIPA Act). The Audit Office’s open access information includes:

• an Information Guide, explaining who we are, what we do and how to interact with us
• Audit Office information contained in any document tabled in Parliament, including the Auditor‑General’s Reports to Parliament
• policy and charter documents
• disclosure log of access applications
• register of government contracts
• record of open access information that is not publicly available.

Proactive release

We conduct an annual proactive release review of information to consider what information the Audit Office holds that is of public interest and should be made publicly available.

In 2023–24, we proactively released the Flexible Work Practices Policy, the Acceptable Use of AI Policy and the Policy Framework.

Access applications and informal release

The Audit Office makes every effort to release certain government information to the public, unless a request relates to excluded information. Information held by us which relates to our auditing, investigative and reporting functions is classed as ‘excluded information’ under the GIPA Act.

During 2023–24, we received no formal GIPA applications. One agency consulted with us on a GIPA application they received and whether we consented to the release of information that related to the Audit Office.

Further information about access applications can be found in Appendix ten.

Annual report

Our annual report is a key part of our commitment to continuous disclosure, and we voluntarily adopt full and open reporting on our performance. The report contains extensive comment on the services we provide and what our key stakeholders think of our services.

In May 2024, for the 15th consecutive year we were awarded a Gold Australasian Reporting Award for our Annual Report 2022–23, and the Governance Reporting Award for public and not‑for‑profit sectors.

ASX Principle 8: Remuneration

Remuneration Committee

The Audit Office’s Remuneration Committee consists of an independent external chair, Dianne Hill, and the director, governance and risk. The committee reviews and makes recommendations to the Auditor‑General on Audit Office remuneration policies, practices and risk assessments.

In 2023–24, the committee met twice and endorsed its charter. It also reviewed:

• management reports and made recommendations on the appropriateness and application of remuneration policies and procedures
• management sign‑offs, including certification on the financial impact of the recommended annual remuneration determination
• the remuneration risk assessment and associated controls
• analysis on the gender pay gap.

See below for details of our executive remuneration.

* Audit Office executive staff employed at the equivalent of the NSW Public Service Senior Executive remuneration bands.
** Due to the nature of our business, 23% of our employee‑related expenditure in 2023–24 was related to senior executive remuneration, compared with 24% in 2022–23.

ASX Principle 7: Risk management

Recognising and managing risk

Our risk management and strategic planning are integrated. Risks are used as an input into the development of our Corporate Plan. They are continually reassessed and managed in accordance with our Risk Management Framework and Risk Appetite Statement to ensure that activities and decisions align with our Corporate Plan.

The Office Executive and Audit and Risk Committee regularly review our strategic risks. Each strategic risk is supported by detailed analysis, considering underlying operational and project risks. In addition, the Audit and Risk Committee provide independent advice to the Auditor‑General on the Audit Office’s risk management and internal control frameworks.

Our Risk Management Framework

Our Risk Management Framework aligns with NSW Treasury’s Internal Audit and Risk Management Policy for the General Government Sector (TPP 20‑08) and the Risk Management Toolkit (TPP 12‑03), the Risk Management – Principles and Guidelines Standard (AS/NZS ISO 31000:2018), and the Accounting Professional and Ethical Standards Board’s professional risk management standard (APES 325 Risk Management for Firms).

During 2023−24, we:

• continued to scan our internal and external operating environment for impacts on existing or emerging strategic and operational risks
• met our annual risk reporting schedule to the Office Executive and Audit and Risk Committee or reported sooner as required
• continued to support a positive risk culture and embed risk management practices across multiple business areas and activities including corporate planning, project management, budgeting, procurement, privacy and data management, sustainability, business continuity, and third‑party selection
• conducted a comprehensive climate risk assessment in line with the NSW Government Climate Risk Ready NSW Guide and the NSW Climate Change Adaptation Strategy
• developed a third-party risk profile assessment tool
• developed a working overseas risk assessment tool
• monitored and reported project risks
• worked closely with our operational areas to increase risk awareness, supporting leaders to effectively identify, assess, manage and report their risks
• continued to monitor the effectiveness of controls to mitigate risks through various assurance activities, including external and internal audit, ISO 27001 Information Security Management System certification, annual penetration testing, and testing of the business continuity plan.

Insurance

Our insurance cover is provided by the Treasury Managed Fund in respect of:

• workers’ compensation according to NSW statute
• property (full replacement, new for old, consequential loss, and business continuity costs or losses of revenue)
• liability, including but not limited to public liability, cyber liability, professional indemnity and directors and officers liability
• miscellaneous losses including those due to employee dishonesty, personal accident, cancellation of events, and travel protection.

Exposures not included are illegal activities, wear and tear, and inherent vice.

Strategic risks

In 2023–24 there were no significant incidents as we continued to manage our risks, including the following six strategic risks:

• Our insights are not relevant and do not result in a demonstrable improvement in public administration (Enhancing our impact, demonstrating our value).
• Our audits are not defensible resulting in lost credibility, trust and confidence by government and the public (Quality in everything we do).
• We do not act according to our own ethical standards, do not meet legal obligations and are not transparent and beyond reproach damaging our reputation (Ethical Standards and Compliance).
• We do not keep pace in a contestable environment resulting in reputational loss and potential disruption to the current business model (Securing our future).
• Inability to develop or access required capabilities compromising our ability to achieve our objectives (Building capability for the future).
• Loss of confidential or sensitive information resulting in compliance breaches, business disruption, financial loss or reputational damage (Uplifting Our Cyber Resilience).

Risk management and internal control attestation

This year, we completed three attestations to provide additional assurance that our Risk Management Framework and related controls are operating properly including an attestation from the Auditor‑General on:

• the quality of the Audit Office’s risk management and internal audit processes, based on our compliance with the core requirements of TPP 20‑08 (Appendix five)
• the management of cyber security risks consistent with the mandatory requirements set out in the NSW Government Cyber Security Policy.

Our chief financial officer also completed an attestation on the effectiveness of internal controls over financial information in accordance with Treasury Policy Paper TPP17-06 Certifying the Effectiveness of Internal Controls Over Financial Information. This attestation is supported by a management control questionnaire that is completed annually by our leadership team on the implementation of internal controls as they relate to their business area and employee compliance with our policies.

ASX Principle 6: Key stakeholder rights

Building effective relationships

In 2023–24, we maintained our focus on building effective relationships with our key stakeholders: NSW Parliament, state government entities, councils and universities.

Our ‘Enhancing our impact, demonstrating our value’ strategic objective provided direction on effective stakeholder relations and is described in more detail in the Enhancing our impact, demonstrating our value section.

Stronger stakeholder engagement

In 2023–24, we delivered briefings to the Public Accounts Committee on the relevant work of the Audit Office, and our current and future planned audit topics and focus areas. Each year we also survey parliamentarians to get feedback on our reports and services. This year’s results are detailed in the Our value to Parliament section.

We meet with the Public Accounts Committee during each sitting of Parliament. In 2023–24, we also continued to meet regularly with NSW Treasury, the Premier’s Department, The Cabinet Office, the Public Service Commission, and the Office of Local Government.

More information on how we sought to improve our engagement with stakeholders can be found in the Enhancing our impact, demonstrating our value section. Feedback from auditees on our performance is available in the Our value to the agencies we audit section.

Working with the public and other integrity agencies

We work closely with other independent agencies in New South Wales and audit offices in other jurisdictions to meet our obligations, improve our services, and increase the impact of our work.

This includes our important work in managing or referring disclosures from public officials when allegations of serious wrongdoing are made (public interest disclosures), and engaging with feedback from the public about the entities we audit. We comply with our obligations to refer allegations of corruption to the Independent Commission Against Corruption. We also refer allegations of serious wrongdoing to the NSW Ombudsman, the Information and Privacy Commission, the Office of Local Government, and other agencies as relevant and where appropriate.

In addition, we participate in forums with other integrity agencies to share information about relevant trends, strengthen referral pathways, share good practices, and identify strategic issues or opportunity to enhance our coordination.

Public interest disclosures and reports of wrongdoing

The Auditor-General has the power under the Government Sector Audit Act 1983 to examine allegations made by public officials about the serious and substantial waste of public money. The Public Interest Disclosures Act 2022 (PID Act) protects public officials who make public interest disclosures in good faith.

The Audit Office has internal and external public interest disclosure policies that enable our employees and other public officials to report allegations of serious wrongdoing, including serious and substantial waste.

At the start of the reporting period, we managed disclosures under the Public Interest Disclosures Act 1994. This was replaced by the Public Interest Disclosures Act 2022 on 1 October 2023. We implemented the requirements of the new act, including the development and publication of our internal policy based on the NSW Ombudsman’s model policy.

In 2023–24, we received 17 public interest disclosures that related to other public sector agencies, all of which were managed under our external policy. These disclosures were either referred to audit branches for consideration as part of their audits, referred to another relevant integrity agency, or both.

No public interest disclosures about the Audit Office were received.

Ensuring our financial sustainability

Like all organisations, the Audit Office has finite resources to deliver on its legislative mandate and fulfil strategic objectives. Our operating model is premised on providing value for-money services that pay their way and utilise contemporary tools and methodologies. This means our limited resources need to be managed effectively and efficiently, and resourcing decisions must be economical.

Our overarching financial objective is to remain sustainable, efficient and fiscally responsible at all times.

We also seek to:

• promote robust and effective financial management of resources
• ensure access to expert direction and relevant context for decision making in the allocation, management, and use of our financial resources
• demonstrate transparency with external stakeholders on how we govern our finances and how we set fees for audit engagements
• embed effective financial risk management practices.

To achieve our objectives, our financial management practices are governed by:

• a comprehensive suite of internal policies on audit fees, our budget, procurement and contract management, and debt recovery as well as our delegations manual and our financial audit commissioning model
• the operation of a Finance and Performance Committee to monitor the financial health of the organisation and to provide advice to the Office Executive and Auditor-General
• mature risk management practices, ongoing financial management capability investment, and the design, implementation, and operating effectiveness of internal controls
• assurances provided by internal and external audit
• key measures of our financial performance and position.

This year, we developed a new Finance Strategy for 2024–2026 which outlines the parameters and principles for how we govern our finances and set our financial audit fees. The strategy provides a framework to ensure the decisions we make support our corporate plan objectives, that our long-term financial sustainability remains intact, that we operate efficiently and that we are fiscally responsible at all times. More information on our financial performance and position is available in the Financial performance section.

Promoting economic and efficient government

The Audit Office of New South Wales has a fundamental role in helping Parliament hold government accountable for the use of public resources. Our performance audits review whether public money is spent effectively, efficiently, economically and in accordance with the law. Our financial audits are a key part of effective public sector governance and assess the adequacy of the financial reporting control frameworks of audited entities.

In addition, in 2023–24, a number of our audit reports focused specifically on topics that directly relate to sustainable financial management practices, including:

• Workers compensation claims management which assessed the effectiveness and economy of icare’s management of workers compensation claims, and the effectiveness of SIRA’s oversight of workers compensation claims
• Design and administration of the WestInvest program which assessed the integrity of the design and implementation of the program and the award of program funding
• Oversight of the child protection system which assessed the effectiveness of the Department of Communities and Justice in planning, designing, and overseeing the NSW child protection system.

Assessing our environmental risks

In 2023–24, we undertook a comprehensive climate risk assessment, supported by the NSW Government Climate Risk Ready NSW Guide and in alignment with the NSW Climate Change Adaptation Strategy. Through this process, we identified our climate change risks and associated mitigation strategies, as well as opportunities arising from these risks or their treatments.

The results of the climate risk assessment informed the development of an adaptation plan which aims to keep our people safe by taking actions within our control and to make a direct impact on our climate footprint. The plan:

• guides the implementation of adaptation actions by allocating owners and target timeframes for the delivery of actions
• outlines an approach to monitoring changes to risk levels
• identifies if risk treatment actions are inadequate.

This year, we also used available tools to assess our maturity in managing climate risk and reducing our carbon emissions. These tools helped us to assess our current systems, and identify short and long-term actions to guide our way forward in reducing emissions and ensuring our climate resilience. We will be working to align with the NSW Government objective to deliver a 70% cut in emissions by 2035 compared to 2005 levels, with the goal to reach net zero emissions by 2050.

A sustainability working group has been established to lead our work in assessing, understanding and improving our net zero maturity. In the year ahead, we will develop a sustainability roadmap which will include developing a policy framework to guide our priorities and setting an organisational climate risk appetite statement.

Maintaining our greenhouse performance

In 2023–24, we maintained our greenhouse emissions performance by:

• operating in a carbon neutral certified, 6 Green Star (with Green Power) rated building
• buying 100% green electricity
• using energy-efficient equipment
• using timers on lights, equipment and supplementary air conditioners.

Reducing our environmental impact

The Audit Office reports its progress against the Government Resource Efficiency Policy (GREP).

In 2023–24, we focused on reducing our environmental footprint by:

• using 100% recycled paper in printers
• encouraging our employees to book green vehicles when using an approved rideshare service
• using sorting bins and promoting internal communication campaigns to encourage recycling
• maximising recycling by including ink, toner cartridges, batteries and coffee pods in our program
• using a secure online file transfer platform to share files digitally
• using automated, sensor‑integrated LED lights in our office
• using virtual collaboration technology and reducing travel to auditees and other stakeholders.

We also conducted a NABERS energy assessment for our tenancy, which resulted in a 6 Green Star result for our office.

In 2024–25, we will remain focused on reducing our environmental impact, including by investigating opportunities to improve our net zero maturity.

Protecting our heritage

In 2023–24, the Audit Office maintained its Heritage and conservation register in accordance with the Heritage Act 1977. Several items are included in the register that are of potential heritage significance. These are limited to moveable heritage objects stored at our office.

Our Heritage Asset Management Strategy outlines how we comply with the principles and guidelines established by the Heritage Council of NSW and NSW Environment and Heritage.

Promoting environmental sustainability in our work

The Audit Office’s performance audits regularly focus on the efficiency and effectiveness of government environmental programs and services. In the context of climate change, and recent environmental disasters, several audits are in progress that will provide assessments, insights and recommendations for the NSW Government on environmental issues that require ongoing management. These include:

• Threatened species and ecological communities (tabled 15 August 2024)
• Coastal management reforms (2024–25).

• 83% of employees felt that there were effective resources to support employee wellbeing

• 93% of employees were satisfied with their ability to access and use flexible working arrangements

Prioritising the wellbeing of our employees

The health and wellbeing of employees is a top priority for the Audit Office and we are committed to supporting employee wellbeing through programs that make a difference. In 2023–24 we:

• reviewed and updated our guidance on illness prevention
• continued to offer flexible work practices to all employees
• progressed our mental health and wellbeing strategy and roadmap
• supported employees who participate in the Corporate Cup running challenge
• provided fresh fruit in the office to promote healthy eating
• offered onsite flu vaccinations or reimbursements, accessed by 38% of employees compared with 28% last year. We also offered onsite COVID-19 vaccinations
• provided employee wellbeing initiatives
• participated in R U OK?Day and delivered a session on how to connect and look after one another
• offered mental health first aid training
• delivered workshops to help employees maintain wellbeing in periods of peak demand
• delivered training on managing for team wellbeing
• recruited a wellbeing and diversity business partner
• discussed resourcing each week at Office Executive meetings
• ensured managers and branch/neighbourhood heads regularly check in on their team wellbeing and assess resourcing requirements
• presented a people and culture report to the Office Executive quarterly, identifying and collectively measuring, tracking and reporting on relevant mental health and wellbeing key risk indicators as an input into assessing mental health and wellbeing risks
• undertook monthly reporting of hours worked by financial audit staff to branch executives to identify potential workload issues.

Our Employee Assistance Program (EAP) offers free, independent and confidential counselling for employees and their families. We encourage employees and managers to use the program to get professional and objective support, for work or personal matters, when required. We regularly promote the program in our internal communications. In 2023–24, nine per cent of employees used the EAP, increased from four per cent in 2022–23. Eighty per cent of employees who used the program sought assistance for personal matters and 20% for work-related issues.

This year, seven employees completed mental health first aid training and two employees attended mental health first aid refresher training. We have 25 accredited mental health first aiders who champion wellbeing and act as an avenue of support to colleagues who may be developing a mental health problem, experiencing a worsening existing mental health problem, or are in a mental health crisis. Our mental health first aiders meet quarterly as part of a peer connect group.

Listening to our people

We were pleased that 83% of employees agreed there were effective resources to support employee wellbeing, consistent with last year. Our overall wellbeing score of 63% was ten percentage points higher than the NSW public sector result. Other wellbeing results included:

• 59% of employees indicated the amount of stress in their job was manageable, a new measure this year
• 60% of employees rated their general sense of wellbeing as seven out of ten or higher, the same as last year
• 65% of employees were neutral or agreed they had not experienced burnout at work, down from 69% last year
• 76% of employees felt satisfied with current workplace practices to help them manage their wellbeing, a new measure this year.

Although we did not conduct our annual WHS survey this year, we did seek feedback from employees on work health and safety, and wellbeing matters via our Work Health and Safety Committee and our Flexible Work Practices Committee, providing our people with avenues to raise concerns or make suggestions.

• 0 notifiable incidents to Safe Work Australia

• 2 new workers’ compensation claims

WHS injuries and incidents

In 2023–24 there were six Work Health and Safety (WHS) injuries, up from two in 2022–23. Although two of these injuries resulted in a worker’s compensation claim, these were not classified as notifiable incidents to Safe Work Australia.

The two new workers’ compensation claims and one previous workers’ compensation claim were closed during the year.

Our WHS Committee is engaged and active

Under the Work Health and Safety Act 2011, the Audit Office is required to consult employees on matters pertaining to work health and safety. The Audit Office continues to do this through the WHS Committee. The committee is made up of six employee representatives, two management representatives and one coordinator. They meet quarterly and play a proactive role in WHS through:

• quarterly WHS inspections of head office
• reviewing and monitoring key WHS risk indicators such as workplace injuries, employee leave and other statistics
• reviewing WHS policies, strategies and procedures
• developing initiatives to promote WHS awareness
• identifying WHS issues and risks, and recommending mitigations
• consulting with workgroups on WHS matters.

Along with our committee members, we have 24 mental health first aiders, 14 fire wardens and two first aid officers all fully trained.

Employee satisfaction with WHS is high

We use the NSW public sector People Matter Employee Survey results to measure employee satisfaction with WHS. The Audit Office’s overall health and safety survey score was 84%, consistent with 86% last year. Results include:

• 86% of employees felt confident work health and safety issues raised would be addressed promptly, down from 89% in 2022–23
• 83% of respondents felt there were effective resources in the organisation to support employee wellbeing, the same as 2022–23.

We did not conduct our annual WHS survey this year, as our usual provider is no longer offering those services. We are in the process of finding a new provider.

Working safely in a hybrid environment

Throughout 2023–24, we maintained our focus on ensuring employees work in a safe and sustainable way as we continued to work in a hybrid environment.

Our Flexible Work Practices Model guided how we worked, and employees agreed with their manager the right approach for themselves, their teams, and our auditees. We were pleased that 93% of employees agreed they were satisfied with their ability to access and use flexible working arrangements consistent with 95% last year.

With many people working from a variety of settings, we focused on ensuring that our physical working environments were safe and ergonomic. This included:

• requiring employees to complete an annual working from home checklist to promote safe home working environments
• sharing wellbeing tips and resources, and avenues of support with employees
• promoting workplace ergonomic tips
• conducting one ergonomic assessment for an employee who had a non-work-related injury
• establishing a new process to identify and manage the work health and safety risks associated with employees working while overseas.

• 60% of senior executives are women

• 57% of our employees’ first language spoken was not English

Celebrating and enabling diversity

We are committed to ensuring we have a diverse workplace that reflects a constantly changing external environment. By embracing the different contributions, perspectives and talents that make up our organisation, we create a culture of participation and respect, and increase innovation, creativity and performance.

Our employees come from more than 45 countries and speak 38 languages. In 2023–24, we recognised 21 cultural and diversity events such as Diwali, Mardi Gras, Lunar New Year, International Day for Elimination of Racial Discrimination, Eid, Harmony Day, Wear it Purple Day, Persian New Year, International Day of Older Persons, and International Day Against Homophobia, Biphobia and Transphobia (IDAHOBIT) to name a few. These celebrations help us recognise the diversity of our workplace and encourage our employees to learn more about other cultures and groups. We also completed the first phase of a project to develop our own employee-led lesbian, gay, bisexual, transgender, queer/questioning, intersex, asexual (LGBTQIA+) Pride Network, undertaking research and mapping to assess the internal and sector-wide resources.

Our Diversity, Inclusion and Accessibility Framework provides an overarching platform to ensure meaningful employment opportunities are available to all people regardless of culture, disability, gender or background. Our Diversity, Inclusion and Accessibility Roadmap 2021–25 sits within this framework.

This year, we delivered mandatory cultural awareness training for all employees and continued to inform and educate employees in cross‑cultural attitudes, practices, norms, behaviours and communications. We provided respectful workplace refresher training, included diversity statements in our job advertisements, and built our diversity calendar with days of cultural significance and celebrations for diversity groups.

In the year ahead, we will enhance diversity of thought through our Workforce Strategy and we will continue promoting diversity in our recruitment campaigns, our diversity calendar, and by promoting supplier diversity across our organisation.

Gender diversity remains strong

The Audit Office has an ongoing commitment to support the growth and development of talented women, eliminate gender discrimination and remove barriers to equal participation. This year, the number of women as a percentage of our total full‑time equivalent workforce was 55%, consistent with 57% last year. The representation of women in middle management was 46%, consistent with 44% last year. The percentage of women in senior executive roles decreased to 60%, compared to 66% last year but closer to our target of 50%. Some of our achievements this year include:

• managing remuneration to avoid gaps based on gender
• attending a summit to support women in leadership
• continuing the Flexible Work Practices Committee
• promoting flexible working practices in recruitment campaigns
• celebrating International Women’s Day and supporting and recognising International Pregnancy and Infant Loss Awareness Month, and White Ribbon Day
• continuing to implement our women’s leadership networking program and hosting a session focused on building confidence and overcoming imposter syndrome
• supporting three women to attend a mentoring event
• providing eco-friendly emergency menstrual products at our head office to ensure everyone’s natural hygiene needs are met
• investigating Menopause Friendly Australia services and recognising World Menopause Day 2023.

In the year ahead, we will remain focused on achieving gender equality by encouraging women to attend leadership events, supporting flexible working practices, conducting gender pay gap analysis and celebrating International Women’s Day. We will also continue to promote female participation in leadership courses and internal leadership networking sessions.

* Audit Office executive staff employed at the equivalent of the NSW Public Service Senior Executive remuneration bands.

Managing the risks of modern slavery

This year, we continued to implement changes to address the Modern Slavery Act 2018 requirements, and took reasonable steps to ensure the goods and services we procure are not the product of modern slavery. The following controls help us to assess and address modern slavery risks in our operations and supply chains:

• a Statement of Business Ethics, which sets out our expectations around suppliers managing the risk of modern slavery
• a Procurement and Contract Management Policy that requires all procurement over $150,000 to include a modern slavery risk assessment, and encourages buyers to assess for heightened modern slavery risks
• a modern slavery risk assessment, which did not identify any high-risk areas based on products and services, or sector, industry, geographical and supply chain risks
• suppliers responding to a request for tender or quote must articulate how they assess and address modern slavery risks in their operations and supply chain in their responses
• our procurement and contract templates impose obligations on suppliers to take reasonable steps to ensure their goods and services are not the product of modern slavery
• mandatory training to build employee awareness.

Meaningful community contributions

We recognise the positive contribution that volunteers can make to communities, and we encourage our employees to take one day of special leave each year to volunteer. By allowing employees time off to engage in volunteering activities, the Audit Office can invest in our local communities and have a meaningful impact.

Our employees can choose causes to support with their time, or can access opportunities that are made available on the NSW Government’s volunteering website.

In 2023–24, our employees supported several fundraising initiatives for the community including the STEPtember challenge for the Cerebral Palsy Alliance, Australia’s Biggest Morning Tea for the Cancer Council, and the Push-Up Challenge to make a difference to mental health in Australia. We also recognised International Volunteer Day. Some teams also used their volunteer leave as an opportunity to give back to the community while also team building, with one team volunteering for a day at Foodbank NSW.

We also provide military leave to support employees who volunteer as part-time members of the Australian Defence Force.

Impacting social outcomes

This year, the recommendations from several of our performance audit reports sought to improve outcomes for the community, including:

• Safeguarding the rights of Aboriginal children in the child protection system which assessed whether the Department of Communities and Justice, and five funded non-government organisations that provide out-of-home care services, are effectively safeguarding the rights of Aboriginal children in the child protection system
• Oversight of the child protection system which assessed the effectiveness of the Department of Communities and Justice in planning, designing, and overseeing the NSW child protection system
• Flood housing response which assessed how effectively the NSW Government provided emergency accommodation and temporary housing in response to the early 2022 Northern Rivers and late 2022 Central West flood events
• Regional, rural and remote education which examined how the NSW Department of Education is ensuring that rural and remote students have access to the same quality of early childhood, school education, and skills pathways as metropolitan students
• Regional road safety which assessed the effectiveness of Transport for NSW’s delivery of road safety strategies, plans and policies in regional areas to manage road safety outcomes across the New South Wales road network.