Volume Six 2014 focusing on Premier and Cabinet
Today the Auditor-General of New South Wales, Grant Hehir, released his Volume Six 2014 Report to Parliament focusing on agencies in the NSW Premier and Cabinet cluster.
Improvements in financial reporting
All agencies in the NSW Premier and Cabinet cluster received unqualified audit opinions for the year ended 30 June 2014.
Overall financial reporting has improved. Agencies submitted their financial statements earlier than last year and for the third year in a row there has been a reduction in the number of misstatements identified during audits.
Contract management needs more attention
Contract management for some of the larger agencies showed some weaknesses. Two key agencies did not have a framework to manage contracts or a centralised contract register making it difficult for management to oversee the delivery of services provided by external providers.
“A rigorous contract management framework is vital to ensure all parties meet their obligations, contractual relationships are well managed, value for money is achieved and the required standards and agreed timeframes are met,” said the Auditor-General.
“Cluster agencies should perform a self-assessment against the key elements of the Audit Office’s Better Practice Contract Management Framework,” he added.
Better management of restructures needed
The NSW Premier and Cabinet cluster has undergone two significant restructures during 2014.
Agencies affected by the first restructure were unable to organise an orderly transition as they were not given advance notice of the changes.
“Restructures can adversely affect service delivery and can lead to inefficiencies if they not well planned and supported,” said the Auditor-General.
Some agencies had to maintain manual reconciliation processes until they were able to establish the necessary bank accounts, financial accounting systems and GST status to support their new arrangements.
“A number of issues including accounting errors could have been avoided if timely guidance was provided to agencies to assist them understand the financial, legal and accounting implications of restructures,” he added.
NSW 2021 Performance Report would benefit from independent assurance
The NSW 2021 Performance Report is produced twice a year by the Department of Premier and Cabinet and details the government’s progress with its goals and targets.
The integrity of the report would be strengthened if it was reviewed independently. In other jurisdictions, state Audit Offices have a mandate to audit this information to provide better government accountability.
“An independent review in New South Wales would provide greater public confidence in the material produced by government on how well it is performing,” said the Auditor-General.
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