Auditor-General's foreword

The ANAO Corporate Plan 2019–20 updates the previous plan and outlines how the Australian National Audit Office (ANAO) intends to deliver against its purpose. This plan sets out our approach and priorities for the next four years (2019–20 to 2022–23) and the measures by which we will be held to account. It recognises our commitment to continue building capability and highlights our desire to engage positively and transparently in delivering audit and support services to the Parliament.

The corporate plan is the ANAO's primary planning document. Our strategic planning process allows us to continually improve practices and capabilities to demonstrate value in the delivery of services to the Parliament. The corporate plan is complemented by the annual audit work program, which reflects the ANAO's audit strategy for the coming year.

The ANAO operates in a dynamic environment that can impact our ability to deliver our purpose. This plan outlines the key capability investments we will make over the next four years to achieve our purpose. In addition, the plan provides detail about our approach to risk management, which is critical to successfully meeting our responsibilities in providing professional and independent audits to the Parliament.

Statement of preparation

As the accountable authority of the Australian National Audit Office, I am pleased to present the ANAO Corporate Plan 2019–20 as required under paragraph 35(1)(b) of the Public Governance, Performance and Accountability Act 2013.

Grant Hehir
Auditor-General
1 July 2019

A summary of the ANAO's purpose, outcomes and activities is shown in Figure 1.

Figure 1: ANAO's purpose, outcomes and activities

Our purpose

The purpose of the Australian National Audit Office is to support accountability and transparency in the Australian Government sector through independent reporting to the Parliament, and thereby contribute to improved public sector performance.

The ANAO delivers its purpose under the Auditor-General's mandate in accordance with the Auditor-General Act 1997, the Public Governance, Performance and Accountability Act 2013 and the Public Service Act 1999.

The executive arm of government is accountable to Parliament for its use of public resources and the administration of legislation passed by the Parliament. The Auditor-General scrutinises and provides independent assurance as to whether the executive is operating and accounting for its performance in accordance with Parliament's intent (see Figure 2).

Figure 2: How the ANAO delivers its purpose

Our role

The Governor-General, on the recommendation of the Joint Committee of Public Accounts and Audit (JCPAA) and the Prime Minister, appoints the Auditor-General for a term of 10 years. As an independent officer of the Parliament, the Auditor-General has complete discretion in the performance or exercise of the functions or powers under the Auditor-General Act 1997 (the Act). In particular, the Auditor-General is not subject to direction in relation to:

• whether a particular audit is to be conducted;
• the way a particular audit is to be conducted; or
• the priority given to any particular matter.

In the exercise of the functions or powers under the Act, the Auditor-General must have regard to the audit priorities of the Parliament, as determined by the JCPAA.

Under the Act, the Auditor-General's functions include:

• auditing the financial statements of Commonwealth entities, Commonwealth companies and their subsidiaries;
• conducting performance audits, assurance reviews, and audits of the performance measures, of Commonwealth entities and Commonwealth companies and their subsidiaries;
• conducting a performance audit of a Commonwealth partner as described in section 18B of the Act;
• providing other audit services as required by other legislation or allowed under section 20 of the Act; and
• reporting directly to the Parliament on any matter or to a minister on any important matter.

The ANAO supports the Auditor-General in this role.

ANAO values

The ANAO upholds the Australian Public Service (APS) values as set out in the Public Service Act 1999. In addition to the APS values, the ANAO places particular focus on respect, integrity and excellence — values that align with the APS values and address the unique aspects of the ANAO's business and operating environment. The ANAO's values guide the office in performing its role objectively, with impartiality and in a manner that supports the Parliament.

Corporate structure

The ANAO is organised into five functional areas:

• Assurance Audit Services Group provides independent assurance on the financial statements and financial administration of all Australian Government entities. It also conducts assurance reviews.
• Corporate Management Group leads corporate strategy and change for the ANAO. It provides services based on specialised knowledge, best practices and technology that enable the delivery of the ANAO's purpose and audit outcomes.
• Performance Audit Services Group conducts performance audits, audits of performance statements and assurance reviews of Australian Government entities and their activities and produces related publications and other information reports.
• Professional Services and Relationships Group provides technical accounting, audit and legal advice and support to the Auditor-General; establishes, manages and monitors the implementation of the quality assurance framework; and manages the ANAO's external relations.
• Systems Assurance and Data Analytics Group provides IT audit and data analytics support to the ANAO's assurance and performance audit work and other information reports, with staff from a range of professional and technical backgrounds, including project management, engineering, system administration, database development, data analysis and financial systems management.

The ANAO website contains further information about the ANAO's corporate structure.

Key relationships

The ANAO's primary relationship is with the Australian Parliament and the ANAO's key interaction with the Parliament is through the JCPAA. Among its responsibilities, the JCPAA considers the operations and resources of the ANAO, including consideration of the ANAO draft budget estimates and making recommendations to both houses of Parliament. The JCPAA is also required to review all ANAO reports that are tabled in Parliament and to report the results of its deliberations to both houses of Parliament. The JCPAA's primary purpose in reviewing audit reports is to assess whether audited agencies have responded appropriately to the Auditor-General's findings. The ANAO supports the work of the Parliament more broadly by providing independent assurance and opinions, including submissions, information, assistance and briefings to parliamentarians and to parliamentary committees. The Parliament and its committees also scrutinise the work and administration of the ANAO.

The ANAO's relationship with the accountable authorities of Australian Government entities is important as they have primary responsibility for, and control over, Australian Government entity operations. This relationship is supported by the ongoing engagement undertaken with officials of audited entities and by the ANAO's attendance at audit committees of Australian Government entities.

The ANAO invests in a number of key external relationships to support organisational learning through the exchange of information and practices. The ANAO contributes to the Australasian auditing community as a member of the Australasian Council of Auditors-General. The ANAO also has close links with the international and regional auditing community through the International Organization of Supreme Audit Institutions and its regional working groups, and contributes to the delivery of the Australian Government's aid program in the Indo-Pacific region. The ANAO values its relationships with the Australian Accounting Standards Board and the Auditing and Assurance Standards Board in their roles of setting and maintaining professional and ethical standards for the accounting and auditing professions.

The ANAO website contains further information about the ANAO's relationships.

Strategic planning framework

The ANAO's governance and strategic direction are underpinned by a strategic planning framework (see Figure 3). The corporate plan is the ANAO's primary planning document and covers a rolling four-year period. From this plan, the ANAO's annual priorities flow into the annual audit work program, business plans, and then to individual performance agreements. The ANAO reports on its activities through its annual report.

Figure 3: ANAO's strategic planning framework

This section sets out the nature of the ANAO's operating environment over the four-year period of this corporate plan. It outlines how factors and changes in the environment may affect and influence the focus of the ANAO's annual audit work program.¹ Understanding, adapting and responding to changes in our operating environment is critical to delivering on the ANAO's purpose.

Supporting the Australian Parliament

The ANAO will seek to achieve its purposes by supporting the Auditor-General's independent exercise of functions under the Auditor-General Act 1997. Key activities will include a program of audit and assurance engagements undertaken to provide assurance to the Australian Parliament on entities' administration and financial statements, and the preparation of reports to inform the Parliament on aspects of Commonwealth administration.

The ANAO will further support the Parliament through ongoing assistance to parliamentarians and committees, particularly the Joint Committee of Public Accounts and Audit (JCPAA), which has statutory duties relating to the ANAO under the Public Accounts and Audit Committee Act 1951. These duties include the examination of all reports of the Auditor-General that are tabled in the Parliament.

Over the period of this corporate plan, a number of inquiries and initiatives may influence the Commonwealth public sector's operating environment, the functions of the Auditor-General and the work of the ANAO. These include:

• the establishment of a Commonwealth Integrity Commission. The ANAO has advised the Parliament that key issues include the appointment of the Auditor-General as external auditor of the proposed commission and the interaction of the proposed commission's enabling legislation and the Auditor-General Act 1997;
• the Australian Government's final response to the September 2018 report of the review into the operation of the Public Governance, Performance and Accountability Act 2013 and the Public Governance, Performance and Accountability Rule 2014. Recommendation 8 of the review was that the Finance Minister, in consultation with the JCPAA, should request that the Auditor-General pilot assurance audits of annual performance statements, and that the JCPAA should monitor implementation of the pilot on behalf of the Parliament;
• the review into the Australian Public Service that commenced in May 2018; and
• the next periodic review of the Auditor-General Act 1997, as foreshadowed by the JCPAA in Report 478: Issuing of a Certificate under section 37 of the Auditor-General's Act 1997: Inquiry based on Auditor-General's Report No. 6 (2018–19).

New models of government service delivery

The ANAO must maintain a contemporary understanding of the public sector. This understanding is critical in supporting the delivery of an integrated audit work program that provides assurance of public sector performance to the Parliament. Failure to adequately respond to changes in the government sector could negatively impact:

• confidence in the ANAO;
• the ability to encourage improved performance and accountability in the public sector; and
• the effective and professional operation of the ANAO.

Changes to service delivery by the public sector are intended to deliver government services more effectively and efficiently. The way in which the Government seeks to deliver cost effective services continues to evolve. This includes direct service delivery by government, joined–up service delivery within the sector and with private sector providers, contracted providers, and equity investment, grants and loans. In this environment the ANAO must remain abreast of new approaches in order to provide high quality, insightful audits to Parliament.

Many aspects of public sector work are now delivered through contracting of providers. This requires skills sets in procurement and performance management within the Australian Public Service (APS). The ongoing desire for government to have access to new policy ideas and the quest for innovation in both policy advice and implementation requires focus on planning and risk management and quality of evidence. For the ANAO, the use by the public sector of outsourced providers can lead to challenges including access to information, and concerns regarding the use of 'commercial' information. The focus remains on providing independent and timely audit findings to the Parliament to support accountability.

Beyond evolving changes to service delivery, the ANAO is aware of those factors that may impact the wider stance and expectations of the APS. On 19 March 2019, the draft report Independent Review of the APS: Priorities for Change was released. The report is being considered by government. The outcomes of the review will factor into the ANAO's consideration of delivery and risk in our audit work.

Technology and data analysis

Technological advances over the last decade have enabled the collection and analysis of large datasets to reveal trends, patterns and associations, and change the interface between citizens, businesses and government. Those advances also present opportunities to develop the evidence base to support policy design and advice. In pursuing advances in technology and data analysis, government continues to improve how it delivers services online. At the same time, the ongoing shift to digital services brings additional risks to stability and security of systems, management of privacy and integrity of data, and business continuity. Likewise, data analysis plays an important role in the work of the ANAO.

Adequate security and privacy restrictions are critical in considering the proliferation of data capture and storage. At a global level, data breaches are illustrating the importance of maintaining personal privacy over large datasets. With rapidly growing cyber security threats, it is necessary for organisations to understand their information and data risks and protect their critical information assets — including private, sensitive and security classified data — from malicious adversaries. This has important consequences for the ANAO in terms of ensuring appropriate management of data collected through the audit process.

Data and analytics are enabling auditors to better identify financial reporting, fraud and operational business risks, and tailor their approaches to deliver more targeted risk-based audits. By using a data-enabled approach, audit outcomes are able to be improved through the automation of procedures and analysis of relationships between variables.

The ANAO considers the need to remain responsive to key technology and data changes as critical to the delivery of our work to Parliament, specifically in understanding and analysing how government is utilising these ongoing advances. Adapting and leveraging these changes will be critical to the ANAO in continuing to meet its purpose, providing opportunities for the organisation to use data analytics to strengthen audit outcomes and present data in a more accessible way to the Parliament.

Investing in a workforce that is capable and skilled to utilise data as part of audit is a key priority for the ANAO.

Audit profession

The ANAO is a professional organisation of people with strong technical and specialist skills who produce quality audits. It is through our high-quality, high-performing people that the ANAO delivers its purpose to the Parliament. The ANAO must continue to deliver the right people, in the right numbers, in the right places, at the right times. As the external environment changes, the ANAO must ensure that it remains relevant and effective. Continuous improvement of staff skills will be a key requirement over the next four years, through the office's ability to attract, retain and develop quality people.

Auditors will always need deep knowledge and experience in traditional areas such as auditing standards, financial accounting and reporting, internal controls, IT, managerial accounting, and taxation. ANAO auditors, now and in the future, will also have:

• good communication skills;
• deep industry expertise;
• strong digital skills;
• the ability to think critically and creatively; and
• the ability to use technology to collect and analyse audit data.

The ANAO is alert to changes in the auditing profession and their impact on the ANAO workforce. Globally, there is increased discussion of the importance of the quality of audit work due to reliance that is placed on that work. This is equally important in both the public and private sectors. Community expectations of the performance of entities increasingly sees it turning to the audit profession to give independent and robust assurance. At the same time, community expectations of the audit profession to perform this function independently and through quality work are high. Integrity and quality in auditing will remain strong cornerstones of the ANAO's work.

The ANAO upholds the APS values as set out in the Public Service Act 1999. In addition to the APS values, the ANAO places particular focus on integrity, respect and excellence — values that align with the APS values and address the unique aspects of the ANAO's business and operating environment. The ANAO's values guide the office in performing its role objectively, with impartiality and in the best interests of the Parliament. The ANAO stresses high standards to ensure independence and accountability across all levels of the organisation, which is essential in the 'glasshouse' in which the ANAO operates.

The ANAO will continue to embed a culture of professionalism and quality, retaining a strong cohort of leaders that can effectively respond to current and emerging challenges. The ANAO will continue to build capability in the areas of data analytics, cyber security, digital communication, and risk identification and management. Failing to maintain and develop an appropriately skilled workforce has a direct impact on the office's risk management and ability to deliver its audit work.

The ongoing development of the ANAO's capability ensures that we are able to continue to achieve and deliver our purpose. Investments in capability support the ANAO to uphold public sector principles and values, while building sufficient flexibility and expertise to meet future needs.

Over the next four years, the ANAO will make further investments in integrity, productivity, workforce, quality and engagement. Focusing on these key areas will allow the ANAO to continue to build capability and remain contemporary.

Integrity

Maintaining credibility and independence is essential in exercising the Auditor-General's powers and delivering against the mandate of the Auditor-General Act 1997. In order to demonstrate these qualities, the ANAO regards integrity as a core value of the organisation — critical in sustaining the confidence of Parliament, strengthening public trust in government and delivering quality audit products.

The ANAO recently used 'IntoSAINT' — a self-assessment tool for audit institutions and other public sector organisations — to identify and evaluate the ANAO's institutional vulnerability and the resilience of its integrity control system. Findings from this self-assessment indicated that the ANAO builds and maintains integrity through a mature control system.

The control system considers the scope of the ANAO's organisational processes and the controls required to manage inherent risks within the operating environment. The ANAO's integrity processes include good governance practices, publishing of gifts and benefits, and an ongoing focus on independence in the delivery of our work. The controls concentrate on clear and established organisational policies, which are regularly reviewed by management and subject to internal audit.

Beyond its control system, the ANAO maintains an enduring focus on promoting integrity as an organisational value that is embedded in our work and in our culture. The ANAO recognises that integrity demands not only quality in our products but also in the behaviours of our people. The ANAO promotes this core value among staff through the delivery of clear organisational expectations, the ongoing development of employee capability, and a consistent approach to performance management.

While the existing control system is robust and our values are embedded in the system, the ANAO will continue to invest in this capability over the next four years to ensure that we continue to operate with the highest levels of integrity. To support integrity, the ANAO will:

• develop an integrity framework;
• develop a communications approach to integrity issues; and
• improve integrity training content and delivery to all staff.

Productivity

The ANAO maintains an ongoing focus on building productivity as a key capability investment. We recognise that improved productivity is critical to demonstrating the efficient use of taxpayer funds in the delivery of our work to the Parliament and the public.

Improving operational processes and organisational practices will ensure the ANAO keeps pace in a contestable environment with reliable, adaptive and professional business practices. We will achieve productivity improvements through a focus on using resources strategically, streamlining our business practices, and modernising our ways of working.

The ANAO is focused on keeping pace with advances in technology. In 2018 and early 2019, we invested in and implemented several IT, data and security strategies that focus on leveraging technology to enable our staff to work with greater mobility and flexibility. For example, we refreshed ANAO laptops and peripheral devices, implemented a cloud strategy, and introduced 'infrastructure as a service' These strategies have empowered our workforce to work remotely — anywhere, anytime. By maintaining our focus on agile use of contemporary technology, the ANAO will continue to build efficiencies and productivity in the work we do and how it is delivered.

Further investments in our ways of working will ensure the ANAO remains efficient and effective, increasing productivity and enhancing performance. These activities will become a part of our business-as-usual processes, enabling continued improvement and enhanced capability.

Over the next four years, to support improvements in productivity, the ANAO will:

• provide an activity-based working environment;
• implement an updated IT strategy;
• implement a data analytics strategy;
• develop a new resourcing model for assurance audits;
• implement new audit tools (TeamMate+); and
• introduce more productivity technology to support efficiency (new time recording and scheduling).

Workforce

The ANAO is a professional organisation of people with strong technical and specialist skills. It is through these high-quality, high-performing people that we are able to deliver our purpose to the Parliament. The ANAO maintains an ongoing focus on workforce capability as its biggest investment, ensuring we are suitably skilled for the future.

In 2018, the ANAO delivered its workforce plan to address current organisational challenges and future capability needs. The plan is focused on building a workforce that is forward looking, risk focused, technologically adept, change orientated and highly adaptive. By sustaining a culture of high performance and professionalism, the ANAO will be able to support increased workforce engagement to deliver organisational outcomes.

Action under the plan has included promoting a shift away from non-ongoing to ongoing staff. This has primarily been achieved through a refreshed and proactive approach to bulk recruitment, which will position the ANAO to manage the periods of high work demand that are characteristic of our audit work.

The ANAO has enhanced both its capacity and capability by developing strategies to leverage the existing skills, knowledge and expertise of staff. In the future, the ANAO will work towards supporting and building core capabilities within staff to enable the sharing of key capabilities across service groups.

Strategies from the workforce plan will continue to be introduced over the next four years. The plan will be implemented through two enabling frameworks and three strategies:

• human resource metrics;
• a core capability framework;
• a recruitment strategy;
• an onboarding and separation strategy; and
• a development and high performance strategy.

Quality

The ANAO maintains a strong and ongoing focus on its quality framework as a core business investment. A sound quality framework supports delivery of high-quality audit work and enables the Auditor-General to have confidence in the opinions and conclusions in the reports prepared for the Parliament. This facilitates Parliament's confidence that the ANAO operates with independence, and that the audit approach meets the auditing standards set by the Auditor-General.

The ANAO quality framework is in accordance with the requirements of Auditing Standard ASQC 1: Quality Control for Firms that Perform Audits and Reviews of Financial Reports and Other Financial Information, Other Assurance Engagements and Related Services Engagements. The framework encompasses a number of key elements, including learning and development requirements, a delegations framework, methodology development and review, an escalation framework for accounting policy and qualifications risk, supervisory and arm's-length internal review, and external review.

The ANAO is subject to external review, both through peer review arrangements with international colleagues and external audits. Section 41 of the Auditor-General Act 1997 establishes the position of the Independent Auditor, appointed by the Governor-General. Under section 45(1) of the Act, the Independent Auditor may at any time conduct a performance audit of the ANAO (having regard to the audit priorities of the Parliament determined by the JCPAA), and audits the ANAO financial statements annually.

Over the next four years, the ANAO will focus on the following enhancements to our quality processes:

• develop and implement a quality assurance plan;
• undertake pilot root-cause analysis of the annual quality inspection results;
• prepare and publish an audit quality report; and
• transition all audits to TeamMate+.

Engagement

Finally, the ANAO considers engagement as a core capability for delivering on our purpose. The ANAO will continue to invest in our engagement strategies to ensure we are able to drive public sector performance through our strong relationship with Parliament and the effective communication of our work.

Over the next four years, the ANAO will look towards strengthening our relationship with the Parliament. In refining our engagement approach, the ANAO will continue to meet the needs of parliamentarians, increase the accessibility of audit reports, and use contemporary approaches to communication.

In developing our engagement capability, we will also focus on increasing the influence of ANAO communication in supporting public accountability and transparency. We will achieve this by refreshing our approach to broadly communicating our audit work, with the inclusion in our Audit Insights publications of key learnings for Australian Government entities. These strategies will aim to increase our influence and impact to meet community expectations.

The ANAO will make investments in and continue to refine its engagement capability through:

• refreshing the parliamentary and external communication framework;
• refining the approach to Audit Insights publications;
• developing a strategic approach to media engagement; and
• establishing an ANAO communication strategy.

Performance measurement informs the Parliament about the ANAO's performance and delivery of its purpose, and provides accountability to the Parliament. The performance framework is also designed for the ANAO's leadership and staff to understand the impact of the activities they are responsible for in delivering against the ANAO's purpose.

The performance measures provide information about what the ANAO expects to achieve in the next four years. The measures will be reported annually over the life of the corporate plan and will be reviewed annually.

The performance measurement framework is based on measuring:

• what we did (output);
• how well we did it (quality and/or efficiency); and
• what the benefits were (impact).

Taken together, the performance measures tell a story of the ANAO's achievement of our purpose. The output measures relay progress in the delivery of the ANAO's audit work. This audit work generates findings and recommendations for improvement that are directed at entities and tabled in Parliament. The impact measures seek to provide information on entities' implementation of audit findings and recommendations for the information of the Parliament, and the extent to which Parliament's engagement with our work leads to improvements in public sector administration.

The ANAO performance measures also include measures relating to quality and/or efficiency. The ANAO operates in a contestable environment and is committed to demonstrating transparency of our operations. The quality and efficiency measures are intended to demonstrate efficient use of taxpayer resources and the ANAO's commitment to quality in our work.

The ANAO annual report contains the annual performance statements, which reports on the achievement of the performance measures and provides narrative and analysis relating to the ANAO's performance. The annual performance statements tell a cohesive performance story on the extent to which the ANAO is meeting our purpose through the activities we undertake.

The activities that contribute to achieving the ANAO's purpose are assurance audit services, performance audit services, and relationships and corporate and professional services.

Assurance audit services

Assurance audit services contribute to achieving the ANAO's purpose through:

• providing assurance on the fair presentation of financial statements of the Australian Government and its controlled entities by providing independent audit opinions for the Parliament, the executive and the public;
• presenting two reports annually addressing the outcomes of the financial statement audits of Australian Government entities and the consolidated financial statements of the Australian Government, to provide the Parliament with an independent examination of the financial accounting and reporting of public sector entities; and
• contributing to improvements in the financial administration of Australian Government entities.

The ANAO audits the annual financial statements of Australian Government entities and the consolidated financial statements of the Australian Government. The consolidated financial statements present the consolidated whole-of-government financial result inclusive of all Australian Government controlled entities, including entities outside the general government sector. These audits are designed to give assurance to the Parliament that an entity's financial statements fairly represent its financial operations and financial position at year-end. The ANAO also undertakes a range of assurance reviews by arrangement with entities, and in accordance with section 20 of the Auditor-General Act 1997. An assurance review of defence major projects is also undertaken annually. More detail on the ANAO's assurance audit services is contained in the annual audit work program.

To assess our performance against our purpose in relation to assurance audit activities, the ANAO measures:

• the number of financial statements audit opinions issued;
• the number of other assurance reports produced;
• the number of financial statements–related reports produced;
• the timeliness of issuing the auditor's opinions; and
• the average cost of financial statements audits. The ANAO also measures the percentage of recommendations agreed and implemented by audited entities.

The performance measures and targets for assurance audit services from 2019–20 to 2022–23 are shown below.

Performance audit services

Performance audit services contribute to achieving the ANAO's purpose through:

• audits of the performance of Australian Government programs and entities, including identifying opportunities for improvement and lessons for the sector; and
• other assurance reviews and information reports to Parliament.

The ANAO's performance audit activities involve the audit of all or part of an entity's operations to assess its economy, efficiency, effectiveness, ethics and legislative and policy compliance. The ANAO identifies areas where improvements can be made to aspects of public administration and makes specific recommendations to assist public sector entities to improve their program management. Entities indicate their agreement to implement ANAO recommendations in the audit report, which is tabled in Parliament. In this way, entities inform Parliament of improvements they intend to make as a result of ANAO audits. More detail on the ANAO's performance audit services is contained in the annual audit work program.

To assess performance against purpose in relation to performance audit activities, the ANAO measures:

• the number of performance audits presented;
• the timeliness of completing performance audits;
• the average cost of performance audits; and
• the percentage of recommendations agreed and implemented by audited entities.

The performance measures and targets for performance audit services from 2019–20 to 2022–23 are shown below.

Relationships, corporate and professional services

Relationships, corporate and professional services are not a separate program in the ANAO's Portfolio Budget Statements, and activity measures here are shared across the ANAO. This area of activity contributes to achieving the ANAO's purpose through:

• facilitating dissemination of the ANAO's findings to members of Parliament, the executive and the public;
• providing organisation-wide support services for the ANAO, based on specialised knowledge, professional practice and technology; and
• ensuring ANAO audits are of high quality and compliant with auditing standards.

To assess our performance against our purpose in relation to relationships and professional and corporate services, the ANAO measures our performance in delivering audit services through our key relationship with the Parliament; and the publication of audit insights and key learnings from audit work. The ANAO also evaluates whether the independent Quality Assurance Program indicates that audit conclusions are appropriately supported by evidence.

The performance measures and targets for relationships, corporate and professional services from 2019–20 to 2022–23 are shown below.

The effective management of risk is integral to achieving our objectives and supporting our purpose over the life of this plan. The ANAO's management of risk is embedded into business-as-usual practices, using consistent language, approaches and documentation, with the adoption of both qualitative and quantitative risk analysis tools applicable across all operations and groups.

Operational risk management occurs in line with the defined roles and responsibilities in the ANAO's Risk Management Framework. The framework is consistent with the Commonwealth Risk Management Policy and the international standards set out in ISO 31000. The Auditor-General, taking into account the advice of the Executive Board of Management and the Audit Committee, establishing the ANAO's appetite and tolerance for risk, oversees the Risk Management Framework.

The Risk Management Framework identifies specific responsibilities for key personnel across the ANAO, and the enterprise risk register assigns owners and tolerances for identified enterprise-level risk. In addition, all ANAO staff have a general responsibility to practise active risk management — a responsibility that staff are prepared for through ongoing mandatory training.

Risk management within the ANAO is one of our core strengths, supported by multi-level and independent review across all major audits, procurements and projects. Risk is integrated into our governance structure through all of our committees, and the chair of each committee ensures that risks are sufficiently managed, analysed, captured and reported, and escalated as required to the Auditor-General in an efficient manner.

Additionally, the Audit Committee is supported by our internal audit function, receiving all internal audit reports and directing senior leaders to provide information as necessary, to ensure that risk is being managed proactively and reported directly to the Auditor-General.

The ANAO has defined strategic risks as those that can arise due to factors outside of the ANAO's control. Currently, we have identified two strategic risks, which are managed in line with the Risk Management Framework and are addressed in our performance measures. The strategic risks are:

1. a reduction in the ANAO's capacity for independent reporting; and

2. Parliament questioning the ANAO's ability to execute its mandate.