Volume Ten 2012 - Engagement performed upon the 2012-13 Half-Yearly Review

Auditor-General's Report to Parliament

20 December 2012

On 5 November 2012, the Treasurer wrote to me under section 27B(3)(c) of the Public Finance and Audit Act 1983, requesting me, among other things, to ‘undertake a review of the reasonableness of the estimates and forecasts in the upcoming Half Yearly Review’.

It is not possible to audit future events. Accordingly, I am providing an assurance conclusion rather than an audit opinion. My review was conducted in accordance with ASAE 3000 ‘Assurance Engagements other than Audits or Reviews of Historical Financial Information’.

I have expressed my concerns in relation to the quality of financial reporting in the NSW public sector for some time. In Volume Four of my 2009 Report to Parliament, I noted:

"Twelve of the 24 largest agencies’ financial reports submitted for audit contained significant errors in the current year’s financial information, while five included significant errors in the prior years’ financial information.

This delayed and increased the costs of preparing and auditing these financial reports. To address this issue financial reports should be prepared periodically throughout the year (i.e. at 31 December and 31 March) using full accrual accounting."

In that report, I recommended the Treasury develop and implement procedures to improve the quality, reliability and timeliness of financial reporting of the New South Wales public sector.

I also raised similar concerns with the Public Accounts Committee at its ‘Inquiry into Financial Management’ on 5 May 2010.

I welcome the Treasurer’s request and recognise the efforts taken this year by Departments and Treasury to improve the robustness of this year’s Half-Yearly Review.

Further information

Emily Watson, on 9275 7408 or 0425 329 363 and email emily.watson@audit.nsw.gov.au.

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