When public sector auditing first arrived in New South Wales it was a highly transactional process, and there was little professionalisation to the exercise. The focus was ensuring that transactions were properly recorded and this was verified for accuracy, largely by checking receipts and invoices against financial records. The ‘Blue Books’ of New South Wales were used to account for livestock, goods, land and even convict allocations.

Completed annually from 1822 to 1857, the Returns of the Colony (‘Blue Books’) are sets of statistical returns of the Colony of New South Wales and of areas under its jurisdiction compiled by the Colonial Secretary for transmission to the Secretary of State for the Colonies in London. They contain the annual accounts of the colony, i.e., the revenue and expenditure of the various government departments; observations about the state of affairs; a list of the officers in each of the civil and military departments (showing their names, position, salary etc.) together with an index to this arranged alphabetically by surname; and also a section dealing with the regulations for the sale of Crown lands and Crown timbers.

The 1828 edition was the only one in which the ‘Blue Book’ was printed in this period. It was also the only year in which the Auditor-General was connected with its production; in other years it was prepared by the Colonial Secretary’s Department. 

Source: Museums of History NSW

Auditors today are charged with analysing a broad range of data to generate insights and deliver recommendations that improve government services. To illustrate the breadth of coverage, this extract from the Audit Office’s ‘Audit Insights’ report, published in 2022, demonstrates six key themes that emerged in financial, performance and compliance audits that were conducted from July 2018 to February 2022. A far cry from tallying up possessions and meticulously examining individual transactions, today’s audits consider important topics such as:

• integrity and transparency
• performance and monitoring 
• governance and oversight 
• cyber security and data 
• system planning for disruption
• resource management. 

The 72 audits conducted over this time period presented recommendations of good practice for government entities to consider addressing, including threats to the integrity of government systems, processes and governance arrangements. Today’s audit reports highlight the need for balanced advice to government on risks, transparent documentation and reporting, and for early and open sharing of information with integrity bodies and auditors.

The word ‘audit’ is derived from the Latin term ‘audire’, meaning ‘to hear’. Originally, auditors would listen to reports being read out by the people preparing them. The original accounting podcast!

Historically, auditors were known to use a green pen for annotating documents.  This made it clear that markings were from an auditor, distinguishing from the black or blue ink commonly found in documents. Public sector auditors, including the Audit Office, traditionally used a brown pen.

Public sector auditing today is multifaceted, and blends traditional approaches with innovative and emerging techniques to ensure that government entities are accountable, efficient and effective in how they use public resources. The role of an auditor is integral to fostering public trust and confidence in government. There are a number of paths to becoming an auditor. Financial auditors typically obtain a bachelor’s degree in accounting, finance, commerce or a related field. Performance auditors come from a broad range of backgrounds. The key requirements include having an analytical and open mind, and an appreciation for the importance of accountability in government.

Historically, auditors were known  to use a green pen for annotating documents.  This made it clear that markings were from an auditor, distinguishing  from the black or blue ink commonly found in documents. Public sector auditors, including the  Audit Office, traditionally used a brown pen.

NSW was the first jurisdiction in Australia (and one of the first in the world) to change from cash accounting to accrual accounting for budget sector agencies. The process of adoption took almost five years, and was completed in 1996.

The Audit Office aims to transparently report its performance each year through its annual report, and has been recognised by the Australasian Reporting Awards with a gold award for 14 years in a row for reporting excellence. The 2017 annual report received ‘Report of the Year’. Other wins and nominations have been in categories such as governance, online reporting and WHS.