Background

1.1 As an integrity agency, the ANAO recognises that maintaining strong institutional integrity is critical to our operations. To support this posture, we established the ANAO Integrity Framework in June 2020 and appointed an Integrity Advisor. Under the Integrity Framework the Integrity Advisor prepares an annual report to the ANAO Executive Board of Management on actions taken under the Integrity Framework.

1.2 In December 2023, we published our Framework and the annual report against the Framework on the ANAO website to provide increased transparency of the measures we undertake to maintain a high-integrity culture within the ANAO. The ANAO continues to publish our Integrity Framework and has expanded the reporting in 2023–24 to include additional integrity related metrics in line with APSC guidance.

IntoSAINT methodology – ANAO Integrity Assessment

1.3 The International Organisation of Supreme Audit Institutions (INTOSAI)¹ developed a Self-Assessment of Integrity (IntoSAINT). The self-assessment tool allows Supreme Audit Institutions (SAIs) and public sector organisations to identify and evaluate their institutional vulnerability and the resilience and maturity of their Integrity Control System against possible integrity violations. The ANAO conducted an IntoSAINT self-assessment in March 2019. The IntoSAINT methodology assesses the SAI’s:

• inherent vulnerability to integrity violations;
• vulnerability enhancing factors that enhance the inherent vulnerabilities of an organisation to integrity violations; and
• the maturity of the integrity control system.

1.4 One of the key principles of the IntoSAINT assessment is to target prevention by identifying integrity weaknesses and risks to strengthen the organisation’s resilience. Vulnerability enhancing factors may provide opportunity, motivation and/or rationalisation for breaches of integrity. These factors do not imply that breaches are taking place but indicate areas where an organisation is more vulnerable or at risk.

1.5 The 2019 IntoSAINT ANAO assessment results for vulnerability enhancing factors identified that the ANAO’s highest vulnerability enhancing factors were elevated workloads and the need for external expertise and outsourcing arrangements. The IntoSAINT assessment identified that:

• Elevated workloads may lead to a loss of thinking time and ability to be strategic or consider efficiency. Elevated workloads may also limit time to dedicate to staff/performance management. Inconsistent workloads can create resentment. The 2019 assessment included risks regarding the depth of staff performance management skills across the ANAO, particularly where technical experts are promoted into management roles. In combination with elevated workloads this exposes the ANAO to risks and may impact how well performance management issues are dealt with.
• The need for external expertise may impact integrity due to the perception regarding the rationale for the choice to use outsiders, rather than drawing on in-house expertise or investing in building in-house expertise.
• Outsourcing arrangements primarily related to the resourcing model in financial statements audit but was also linked to concerns with high staff turnover and that replacement staff often have less experience and audit expertise.

1.6 The 2019 IntoSAINT ANAO maturity assessment identified that the key strengths of the ANAO’s integrity control system related to:

• management’s attitude to integrity;
• integrity legislation, regulations, values and professional standards;
• security (physical and information); and
• recruitment and selection.

1.7 The identified areas for improvement in the 2019 assessment related to assigning responsibilities for integrity, and raising awareness of integrity. In response to the assessment, the ANAO Integrity Framework was developed and the Integrity Advisor appointed with responsibilities to increase integrity awareness and be available as a contact point for staff to raise any integrity related matters. Nine recommendations were raised in the 2019 IntoSAINT assessment that were all accepted and actioned by the ANAO.

2023–24 vulnerability and maturity assessment

1.8 An IntoSAINT self-assessment involves moderation from a certified moderator from another SAI. In 2019, a certified moderator from the New Zealand Office of the Auditor-General (NZ OAG) led the ANAO self-assessment.

1.9 The ANAO uses available information to assess if the vulnerabilities identified in the 2019 IntoSAINT assessment continue to be present or if there are other emerging vulnerabilities and risks that need to be considered in the resilience and maturity of the Integrity Framework. The ANAO also captures changes to processes and actions taken during the year to strengthen the integrity framework. The vulnerability and maturity assessments are set out in chapters 3 and 4 of this report.

Human Resources (HR) matters

Formal matters

2.1 In 2023–24 there were no code of conduct investigations (2022–23: nil).

Bullying and harassment

2.2 In 2023–24 there were three formal reports of bullying and harassment made to the ANAO Human Resources Business Partnering (HRBP) team (2022–23: nil). In each case the HRBP team investigated the claims. The outcomes of the investigations in two cases were that no breaches were identified and in one case a warning was issued.

Discrimination

2.3 In 2023–24 there was one formal report of discrimination (2022–23: nil). The HRBP team conducted an investigation resulting in the individual acknowledging the issue, apologising to the complainant and undertaking training. The matter was closed, with the HRBP and Work Health and Safety Manager providing support to the complainant, including professional counselling.

2.4 The APS Census results related to bullying, harassment and discrimination are assessed at paragraph 3.13.

People matters

2.5 In addition to the above matters, during 2023–24 the HRBP team provided advice to managers and staff on a range of people matters, including matters related to probation, performance and wellbeing. Early intervention and support from the HRBP team aims to prevent matters from developing into formal cases.

2.6 The HRBP team meet monthly with the Group Executive Directors (GEDs) for each group to discuss HR related data and cases. Quarterly data is presented to the GEDs.

Performance management

2.7 The ANAO performance management cycle runs from 1 November to 31 October each year and participation in the cycle is mandatory for most ANAO employees.² The summary of performance ratings for eligible staff for the performance management cycle ended 31 October 2023 is set out in the table below.

2.8 As at 30 June 2024, 375 staff have performance agreements in place and five staff are non-compliant with the submission of the Performance Agreement policy (99% compliance rate). The HRBP team monitor and communicate with GEDs regarding performance agreements that have not been submitted by the required due dates.

2.9 As at 30 June 2024 there are no formal Performance Improvement Plans (PIP) or pre-PIPs in place for staff. The key to tackling underperformance is identifying it early and acting without delay. As at 30 June 2024, there are 16 active underperformance cases being monitored. The first steps in addressing underperformance are to ensure that the staff member has clear performance expectations and to hold regular performance conversations.

2.10 During 2023–24, ANAO staff numbers continued to increase to support our growing audit program with a total of 446 APS employees at 30 June 2024 compared to 405 at 30 June 2023. With the ongoing recruitment and onboarding of new starters, this year there has been an increase in probation management cases. The ANAO HRBP team supports managers with the application of the performance management framework with a focus on probation management including awareness raising with managers regarding completion of three- and six-monthly probation reporting.

2.11 In 2023–24 there was a total of 66 staff on probation (excluding Graduates). Of these 66 employees, as at 30 June 2024:

• 25 successfully completed probation;
• 36 remained on active probation;
• 5 departed during the probation period.

2.12 In 2023–24 there has been an increase in managers seeking advice and support from the HRBP team regarding application of the performance management framework. To address this HRBP is revising manager guides and communicating the importance of active performance management.

Leave, flex and TOIL balances

2.13 The HRBP team has been working with managers of staff who have exceeded annual leave and flex time limits. The outcome of reducing large annual leave and flex balances is to ensure workloads are appropriate, reducing the risk of stress and burnout. Accumulated flex balances vary between groups in line with peak work periods. The new ANAO Enterprise Agreement 2024-2027 (EA) commenced operation on 29 March 2024 introducing Executive Level time off in lieu (EL TOIL). Once the HR system changes are implemented to capture and report EL TOIL this will provide further information to groups regarding workloads over peak periods.

Enterprise bargaining negotiations

2.14 The ANAO Enterprise Agreement 2024–2027 (EA) was approved by employees on 7 March 2024, after the conclusion of ANAO specific bargaining negotiations. The EA was negotiated by employee bargaining representatives and the ANAO’s Enterprise Bargaining team, and consisted of two parts: APS-wide bargaining and agency-specific bargaining. APS-wide bargaining, led by the Australian Public Service Commission, focused on common conditions for all APS agencies, while agency-specific bargaining focused on conditions specific to the ANAO. The ANAO Chief Negotiator and Deputy Chief Negotiator observed that the ANAO’s bargaining process was conducted in a professional and collegial manner, with differences in position worked through professionally.

Disclosures under the Public Interest Disclosure Scheme

2.15 One Public Interest Disclosure (PID) matter was received by the ANAO PID Authorised Officers in 2023–24 (2022–23: nil). The matter was processed and a notification provided to the Principal Officer (Acting Auditor-General) within the assessment timeframe. An investigation was finalised within the 90-day period allowed and no recommendations were made.

2.16 The ANAO published revised PID procedures in November 2023 following the release of refreshed instructional material by the Office of the Commonwealth Ombudsman. These changes mostly reflect amendments to PID arrangements arising from the standing up of the National Anti-Corruption Commission (NACC).

Diversity Contact Officer matters

2.17 Diversity Contact Officers (DCOs) are available to provide ANAO staff with confidential support and advice on workplace issues. DCOs are ANAO officers who provide this advice and support in addition to their normal jobs.

2.18 One integrity related matter was consulted with a DCO in 2023–24 when a recruitment panel member raised a concern with a process. After discussing with the DCO, the panel member resolved the concern by reminding all panel members of the policies and standards we uphold in the ANAO. As a result the recruitment process was carried out fairly and in accordance with ANAO policies.

2.19 This matter demonstrates the pro-integrity culture in the ANAO, where staff are comfortable and supported when speaking up when they identify concerns about actions not aligning with the ANAO’s policies and integrity principles.

Fraud and Corruption

2.20 There were no incidents of fraud or corruption identified in the ANAO in 2023–24 (2022–23: nil).

2.21 The ANAO finalised the review and update of the ANAO Fraud and Corruption Framework 2024-26 in June 2024. The updates reflect the changes to the Commonwealth Fraud and Corruption Control Framework that came into effect on 1 July 2024.

2.22 In preparation for the implementation of the ANAO Fraud and Corruption Framework, fraud and corruption awareness was emphasised in several information sessions and internal communication strategies. Staff are also required to complete mandatory fraud and corruption training by 5 November 2024.

Misuse of credit cards

2.23 There were eight instances of misuse of ANAO corporate credit cards in 2023–24. This represents less than 0.1 per cent of total credit card transactions (2022–23: 10 instances at 0.1 per cent of total credit card transactions). There was a decrease in instances compared to previous years.

2.24 Although the proportion of misuse is small, each instance is investigated, with all incidents found to be inadvertent. All instances of credit card misuse were reported to the Executive Board of Management. The Chief Finance Officer contacted those staff who misused their credit card, reminded them of their obligations when using the card, and ensured that the amounts associated with the misuse of the credit cards were repaid into the ANAO’s bank account.

Completion of mandatory learning and development

2.25 ANAO staff are required to complete mandatory e-learning courses on commencement at the ANAO and on an annual basis including:

• Values and Code of Conduct;
• Work Health and Safety;
• Protective Security;
• Respect and Diversity;
• Risk Management and Fraud Control; and
• Performance Management.

2.26 New starters are additionally required to complete:

• ANAO Induction;
• Records Management;
• E-Hive Introduction; and
• APS Induction – Integrity in the Australian Public Service.

2.27 A summary of the completion of mandatory e-learning courses as at 30 June 2024 is below.

Staff completion of mandatory e-learning courses

2.28 The mandatory e-learn completion rate across the ANAO as at 30 June 2024 remains consistent with the previous year. The difference in completion rates is often caused by the timeframes allowed for completion of mandatory training by new starters and when staff are on leave at the time of the refresher annual training deadline which varies for each staff member. New starters are required to complete mandatory training within one month of commencing at the ANAO.

2.29 In addition to e-learning courses, new starters are required to attend a one-day new starter induction workshop. These sessions are offered monthly and attendance for the induction workshop is monitored by the CMG Capability team to ensure that all new starters participate in the training as soon as possible after commencement. In 2023–24 all new starters, including graduates, attended an induction workshop except for staff members that were deemed to be exempt from attending. Staff who have previously worked at the ANAO, departed and then returned to the ANAO within a short time period are able to apply for an exemption.

2.30 The ANAO ensures that staff are aware of their responsibility to complete mandatory training by:

• providing new starters with information regarding the e-learning courses in onboarding emails and in automated notifications in the ANAO Learning Management System (LMS); and
• sending several automated reminders to all staff in the month prior to deadline for annual refresher training.

2.31 GEDs can monitor mandatory training completion data on the Human Resources Dashboard. Practice Management Units also have access to Learning Management System (LMS) reporting. The HRBP team discusses mandatory completion rates at the monthly meeting with GEDs.

Personal interest disclosures

2.32 The Auditor-General, all SES officers and employees who, in the Auditor-General’s opinion, may have similar decision-making responsibilities, are required to submit at least annually a written declaration of their and their immediate family’s financial and other interests that could involve a real or apparent conflict of interest. SES and other key personnel completed declarations in September 2023 and no potential conflicts were declared that required management. All declarations are reviewed by the Deputy Auditor-General and escalated to the Auditor-General if required. The requirement for SES and other relevant employees to complete and submit a declaration of interest is governed by section 13 of the Public Service Act 1999.

2.33 In addition to the Declaration of Personal Interests, the ANAO has independence policies requiring that all audit staff complete independence declarations. Under the ANAO Audit Manual the Auditor-General, Deputy Auditor-General, ANAO audit staff and in-house audit contractors are required to complete a declaration of independence prior to participating in an audit, review, other assurance engagement or information report. Any actual, perceived or potential threats to independence are declared to the responsible Engagement Executive for evaluation. Safeguards are put in place to reduce any threats to an acceptable level. These safeguards can include removing members from an audit team or excluding them from specific aspects of audit work where the threat arises, and additional levels of review to ensure that judgements made are appropriate.

Gifts and benefits

2.34 The ANAO must meet public expectations of integrity, accountability, independence, transparency and professionalism. This can only happen if staff are not influenced, or perceived to be influenced, by gifts, benefits, or bribes. The Auditor-General’s Instructions and Financial Management Procedures set a clear guiding principle for ANAO officials to avoid the acceptance of gifts, benefits or hospitality and decline at the time of offer. In some instances, staff may accept gifts such as when the ANAO receives cultural gifts from international delegations. ANAO staff must report any offered gift or benefit, whether accepted or refused, within 10 business days of the offer being made via the gifts and benefits register. Permission to retain any gift or benefit requires permission of the Deputy Auditor-General or the Chief Operating Officer (COO).

2.35 The gifts and benefits register is published on the ANAO website on a monthly basis for transparency and accountability. In 2023–24 a total of 75 retained gifts were reported, including:

• 52 gifts and souvenirs from peer audit office staff during international conferences, peer reviews and capacity building activities that the ANAO undertakes with the Audit Board of the Republic of Indonesia (BPK) and the Papua New Guinea Audit Office. These gifts were accepted as cultural gifts or were gifts provided to all attendees or presenters at conferences;
• items that provided benefits to the ANAO such as flight or frequent flyer membership upgrades, a networking opportunity and a free event on a topic relevant to an audit topic; and
• low value unsolicited calendars and books.

2.36 The register reports a total of 19 declined gifts, which included invitations to events and forums and other gifts.

2.37 The register also reports a total of two gifts were returned to sender as they were sent in error.

2.38 The gifts and benefits register includes gifts and benefits offered to the Auditor-General. These gifts and benefits are also disclosed on the ANAO website along with the Auditor-General official expenses. This is a voluntary disclosure that is updated every six months.

Outside employment or activities

2.39 The ANAO provides its staff with flexibility to participate in employment or activities outside the Australian Public Service if the employment or activities do not conflict with or adversely affect the performance of their official duties. A range of activities may be deemed to be in the public interest and of professional benefit to the individual and to the ANAO. Outside employment (paid or unpaid) or volunteer activities are undertaken by an employee in addition to their official duties or while on paid or unpaid leave from the ANAO.

2.40 Prior approval is required for all outside employment and activities, unless specifically excluded from the policy. The Deputy Auditor-General is the delegate for approving outside employment or activities. At 30 June 2024, the ANAO had 16 approvals recorded for staff undertaking outside employment or activities.

Integrity Advisor activities

2.41 During 2023–24 the Integrity Advisor was approached by three staff members with queries and requests for advice.

• One staff member raised concerns about the employment manual not being updated to reflect the conditions under which ANAO employees worked under until ANAO specific enterprise bargaining had been completed. This was in reference to legislative changes in accordance with the Fair Work Act amendments. This matter was resolved through communication by the Chief People Officer during an all staff update meeting regarding enterprise bargaining. The Chief People Officer explained that the employment manual was up to date on key matters and the further updates required were administrative in nature, such as updating links.
• One staff member raised a query regarding a gift provided. This was referred to the governance team and was subsequently reported on the gifts and benefits register.
• One staff member requested advice regarding the appropriateness of attendance at an event in a personal capacity.

2.42 The Integrity Advisor meets with the COO on a monthly basis to discuss integrity matters and has provided advice to the COO on integrity related matters.

2.43 The Integrity Advisor also provided advice to the Auditor-General during the year on integrity related matters, including reviewing Integrity Agencies Group papers and the APS Integrity Taskforce Report. The Auditor-General also requested advice on whether the systems, controls and reporting in the ANAO Integrity Framework give us confidence that staff will escalate bad news as well as good news.

2.44 During 2023-24 the Integrity Advisor provided advice internally to:

• the ANAO Finance team regarding a potential conflict of interest in procurement and on a guidance document they were preparing regarding compliance breaches; and
• the ANAO governance team during the revision of the fraud and corruption strategy.

Protective security

2.45 Under the Protective Security Policy Framework, for 2023–24, the ANAO maintained a self-assessed Maturity Level Three, defined as fully implemented and effective and integrated, as applicable, into business practices.

Pre-employment suitability screening

2.46 ANAO has pre-employment eligibility checks including rigorous selection processes, identity verification and Security Clearances or equivalent.

Security incidents

2.47 ANAO monitors security processes through a skilled security team, guided by the ANAO Security Committee which is responsible for monitoring security policies. The Security Committee receives reports on trends of breaches and discusses concerns if they arise. The majority of security breaches in 2023–24 were self-reported and of low severity.

Threats

2.48 The IT security team is enhancing its ability to respond to security incidents in the context of increasing external threats and the evolving threat environment.

2.49 Phishing is the main attack vector; the ANAO receives a high number of emails of which a high percentage were spam or malicious emails. The security team successfully filtered and blocked the majority of spam or malicious emails, using advanced spam filtering and antivirus software. Staff reported phishing and other suspicious emails, demonstrating a workforce aware of potential environmental threats.

Access controls

2.50 The ANAO has access controls in place to all IT systems, supported by active logging and monitoring of user access.

Updating security policies and training programs

2.51 To mitigate present and future security threats and risks, security policies and training programs are regularly reviewed and enhanced.

2.52 Training programs have been enhanced to incorporate real-world scenarios including risks posed by AI to effectively demonstrate security principles. This approach aims to assess and uplift security awareness of staff. Implementation of revised training has commenced during security training delivered at ANAO Induction for new starters and Graduate training.

Security – integrity culture

2.53 The Chief Digital Officer and Chief Information Officer indicated that the strong integrity culture of the ANAO supports integrity regarding IT security, where staff exhibit a high level of commitment and adherence to the security policies. They reported that staff are aware of and attentive to security threats, and this is evidenced by the majority of security incidents being self-reported.

2.54 The current threat environment is high. CMG has increased the security team average staffing level in response to the increased threat. However staff vigilance remains a key factor in maintaining a safe environment. The security team is enhancing frameworks and control systems to strengthen monitoring and detection capabilities.

Procurement

2.55 In 2023–24 the ANAO did not receive any complaints regarding ANAO procurement processes (2022–23: nil). The procurement complaints mailbox is a mechanism for suppliers and/or potential suppliers to lodge a formal complaint if they believe the ANAO has breached or will breach Commonwealth Procurement Rules and this has affected or will affect their interests.

2.56 There were 76 instances where procurement contracts and 99 instances where contract variations/amendments made by the ANAO were registered on AusTender within the required 42-day period.

2.57 There were nine instances where procurement contracts and two instances where contract variations/amendments made by the ANAO were registered on AusTender after 42 days. The ANAO is seeking to eliminate all instances of late reporting by undertaking daily reviews of procurement activity and is investigating whether the process can be automated. All instances of reporting outside the mandated timeframe are reported to EBOM.

2.58 The procurement team is drafting a new Procurement Strategy to identify areas of improvement to ensure consistency, adherence to legislation and policies and efficiency.

Awards and recognition

2.59 The ANAO awards system recognises and rewards people whose behaviours and contributions align with the ANAO values of integrity, excellence and respect, and assist the ANAO to achieve its objectives. This system includes formal ANAO awards such as the Auditor-General’s Australia Day Awards and the Auditor-General’s Outstanding Achievement Awards. In 2023–24 award recipients included ANAO staff who demonstrated a commitment to ANAO integrity principles and professionalism with a focus on commitment to assisting staff and colleagues.

3.1 This report captures available information to assess if the vulnerabilities identified in the 2019 IntoSAINT assessment continue to be present or if there are other emerging vulnerabilities and risks that need to be considered in the resilience of the Integrity Framework. This includes an assessment of the environment, issues raised through ANAO governance committees and the 2024 ANAO APS Census results.

Environment

3.2 Building the integrity of the Australian public sector remains a key focus within the public service including the ongoing suite of APS reforms aimed at addressing integrity related issues within public administration.

3.3 In November 2023, the Department of the Prime Minister and Cabinet released the final report of the APS Integrity Taskforce, Louder Than Words: An APS integrity action plan. The report presents 15 recommendations to address recent lessons in public administration and improve integrity standards across the service. The action plan acknowledges the importance of integrity institutions in the sector and their respective roles in driving accountability and transparency. All APS agencies, including the ANAO will contribute to a biannual implementation progress report demonstrating actions taken in response to the recommendations commencing in 2024–25.

3.4 In June 2024, the JCPAA concluded its inquiry into probity and ethics in the Australian public sector, publishing Report 502: The never-ending quest for the golden thread, reviewing five ANAO performance audit reports. The report makes 11 recommendations, including recommending that the Public Governance, Performance and Accountability Act 2013 (PGPA Act) framework be amended to introduce a requirement for entities to develop, maintain and report on an overarching integrity framework.

3.5 In September 2023 the Integrity Advisor reviewed the ANAO submission to the JCPAA inquiry to consider how the themes we identified in audits can be applied in the ANAO, including in procurement, record keeping and accountability for performance:

• The ANAO introduced additional approval processes when a limited tender approach is proposed to ensure that we achieve the principles underpinning the procurement rules;
• Record-keeping and documentation of audit judgements is an identified area for improvement from our internal quality assurance reviews of audits. This continues to be an area of focus for audit teams to ensure that the audit file reflects the rationale and support for significant audit judgements and decisions; and
• In our internal quality assurance reviews, if findings are identified related to non-compliance with auditing standards, policy or methodology there can be instances where audit teams seek to argue the rating of findings and suggest that they are minor documentation issues. In response to this there have been messages to reinforce the importance of being open to learnings from quality assurance reviews as the objective is to make continuous improvements to audit quality.

3.6 Community interest in the integrity of the audit profession is also a key focus for the ANAO. In response to the community’s high expectations of the audit profession to perform its functions independently and professionally, integrity, ethics and quality in auditing remain cornerstones of the ANAO’s work.

3.7 In 2023–24 the ANAO considered the integrity related reports arising from the reviews of the public service and the audit profession and considered if there are lessons that we can apply with the aim of further strengthening our Integrity Framework and culture. In September 2023 a Senior Executive Service Forum was held on Integrity, led by the Auditor-General where the leaders of the ANAO discussed where our integrity risks arise, what are we doing well and, as an integrity organisation, what we can focus on to be an exemplar in the sector. The group reflected that our integrity framework could be enhanced with practical examples and also considered the link between compliance culture and ethical culture. They also discussed the importance of encouraging staff to speak up if they have a different view or new ideas through leading by example and coaching and mentoring.

Governance and committees

3.8 The ANAO’s governance framework supports the organisation to uphold public sector principles and values, including legislative requirements for accountability, leadership, transparency, integrity, efficiency and risk management. The framework ensures that our operations remain compliant with relevant laws, standards and directions. This supports effective management of the organisation to achieve its purpose and meet public and community expectations of probity, accountability and transparency.

3.9 The EBOM advises and supports the Auditor-General in achieving the ANAO’s purpose. EBOM is supported by six subcommittees and three operational committees. In 2023–24 there were no issues raised regarding integrity through the subcommittees to EBOM. A continued area of risk that was discussed in EBOM was concerns about the willingness of staff to learn lessons from quality assurance reviews. In EBOM’s consideration of a report setting out potential root causes of quality assurance review findings, members discussed the importance of fostering a culture of continuous improvement. In the Acting Auditor-General’s message to all staff following the meeting in May 2024, she emphasised the importance of remaining open to accountability and lessons learned so that we continue to improve audit quality and meet the high standards expected by the Parliament. This is consistent with the considerations noted in paragraph 3.5.

Australian Public Service (APS) Employee Census 2024

3.10 The APS Employee Census is an annual survey which is used to collect confidential attitude and opinion information from APS employees on issues in the workplace. It is an opportunity for APS employees to share their experiences of working in the APS. The APS Census results provide insight into employees’ views about the APS, their agency and their workplace. The Integrity Advisor identified questions from the 2024 ANAO APS Census results³ that related to integrity and vulnerability enhancing factors identified in the IntoSAINT methodology.

Note 1 – The APS Census included responses from 400 ANAO staff (93% response rate). The number of staff included in brackets in the tables is an estimated number and was calculated from the percentage results from the overall ANAO responses. Rounding may impact the accuracy of these numbers.

3.11 In the 2019 IntoSAINT report, the need for external expertise and outsourcing primarily related to the engagement of experts in audits, the contracting out of selected audits to industry specialists and the purchase of financial statements audit methodology. The potential impact on integrity is that staff may have a negative perception of choosing outsiders rather than investing in building in-house expertise. The need for external expertise and outsourcing was also linked to staff turnover, with replacement staff often having less audit experience and expertise. The ANAO Workforce Plan 2022–25 sets out that the ANAO’s commitment to investing in our people, supporting their development as leading audit and public service professionals. While the ANAO faces challenges in needing to grow the size of the audit function in a tight labour market, the ANAO has a comprehensive implementation plan to ensure that we attract, develop and retain a high-performing workforce.

3.12 The ANAO’s 2019 IntoSAINT assessment report linked elevated workloads to a risk to effective performance management. In the 2024 APS Census the responses to questions related to ‘leadership - immediate supervisor’ were largely positive, with all questions responded to with at least 79% positive rating. The positive response rate to ‘my supervisor provides me with helpful feedback to improve my performance’ is 81% and is four points above the APS overall percentage. This response suggests that despite fairly consistent reporting of elevated workloads, performance management has not been compromised.

3.13 The following APS Census results relate directly to integrity matters.

3.14 The 2024 APS Census responses to the questions related to bullying, harassment and discrimination show that the percentage of discrimination has slightly increased and the percentage of bullying has slightly decreased. There has been a decrease in the percentage of discrimination reported in the survey occurring in the ANAO (current agency) as opposed to a previous agency, but an increase in actual instances. The basis of discrimination changed from the prior year with gender now being the highest response followed by caring responsibilities.

3.15 In 2024 there was a decrease in staff reporting bullying and harassment compared to previous years; however as noted in Chapter 2, the ANAO HRBP team received three formal HR reports of bullying and harassment compared to none the previous year. This suggests that this year matters are being formally reported, whereas in previous years, matters may have been resolved through reporting to supervisors and through informal advice from the People Team without requiring escalation to formal reporting. The instances of bullying, harassment and discrimination which are not reported increased after a significant decrease in the previous year, which is not in line with the leadership messaging to raise and report inappropriate behaviour.

3.16 The 2024 APS Census introduced new questions related to integrity and stewardship. The ANAO response related to the integrity culture was 12 points higher than the APS overall and the stewardship response was six points higher than the APS overall. This is a positive reflection on the culture and people within the ANAO.

3.17 The following questions relate to employee engagement.

3.18 The overall ANAO employee engagement index score remained the same as the prior year. The results demonstrate that ANAO staff have strong values and commitment to the purpose, objective and goals of the ANAO.

4.1 In 2023–24 the ANAO continued to focus on maturing the processes and controls that make up the ANAO Integrity Framework. As an integrity agency within the Australian Public Service, the ANAO has a strong pro-integrity culture. A pro-integrity culture involves the embedding of integrity into an agency’s culture, where it is a core consideration in all it does — from the conduct of its individual employees to its systems and practices. In a pro-integrity culture the primary motivating factor in the day-to-day conduct of APS employees is a genuine commitment to upholding and championing integrity as a core component of a professional public service.⁴

4.2 In the ANAO the Auditor-General sets the tone from the top regarding integrity. In 2023–24 the Auditor-General and Acting Auditor-General maintained a strong focus on integrity in communications with all staff through ANAO Town Hall meetings as well as in published ANAO documents including the ANAO Annual Report and Corporate Plan.

4.3 Upholding the ethical values of the public sector requires compliance with all relevant laws and acting in a way that is right and proper as well as technically and legally correct. The Auditor-General sends this message not only to the sector and entities that we audit, but also internally. As an integrity agency, the Auditor-General sets a clear expectation that ANAO staff must hold themselves to a high standard of integrity and uphold ethical values.

4.4 The ANAO is an organisation focused on continuous improvement. In our performance audits we raise recommendations for auditees to improve processes. For each performance audit recommendation we perform a review of our processes and practices to ensure that we have the processes and practices in place in line with our recommendations. This is consistent with the reviews undertaken in response to external reviews and reports noted in paragraphs 3.2 to 3.7.

4.5 The APSC sets out that a culture of integrity requires a strong values-driven mindset at every level, exemplified by leaders, as well as systems and frameworks that enable and encourage individuals to do the right thing. The ‘building blocks’ for this pro-integrity culture are awareness, capability and accountability:

• awareness of the obligations for working professionally and the role and responsibilities of agencies to support APS employees to understand and navigate challenges to ethical decision-making;
• capability of APS employees to identify and work through ethical challenges, ensuring they have or can develop the skills to address these integrity concerns; and
• accountability for decisions and actions at every level, and systems for addressing concerns about employees’ integrity or conduct appropriately and consistently.

2023–24 Integrity awareness, capability and accountability activities

Awareness

4.6 In June 2023 the ANAO launched Integrity Awareness Week, an annual event to focus on how we make integrity integral to our daily work. Integrity Awareness Week 2024 was held in July 2024.

4.7 In addition to the integrity sessions presented in Integrity Awareness Week, the ANAO Integrity Advisor delivers integrity training sessions to graduates and new starters as part of the induction processes. These sessions promote awareness of the Integrity Framework and principles that the ANAO upholds. In these sessions participants explore scenarios where integrity challenges may arise in our daily work, building capability on how to address integrity concerns.

Capability

4.8 In November 2023, the ANAO’s LearnFest was held with the theme ‘Leading with integrity — driving improvements in public sector performance’. LearnFest aims to improve organisational culture, develop staff and leadership capability, and support wellbeing and diversity. LearnFest 2023 featured thirty-two events over five days. The program included face to face delivery, virtual and hybrid delivery with sessions focussed on integrity and ethics. LearnFest featured:

• a keynote speech from President of the Senator the Hon Sue Lines on integrity;
• a presentation by the Deputy Commissioner, National Anti-Corruption Commission (NACC) on the establishment of NACC;
• a presentation from Professor Anne Twomey on constitutional law and ethical considerations for auditors; and
• an Integrity Workshop delivered by the Integrity Advisor.

Accountability

4.9 Accountability for decisions and actions taken is built into the ANAO’s governance and reporting structures as well as the performance management processes. Integrity has been incorporated into the ANAO capability framework and upholding the APS and ANAO values is built into our performance agreements and evaluations. The ANAO performance cycle process includes and end of cycle evaluation and performance rating. All ratings are reviewed and moderated by the Moderation and Remuneration Committee where demonstration of integrity is a key consideration for the ratings assigned to all staff.

5.1 The 2022–23 Integrity Report set out the Integrity Strategy for 2023–24. This strategy included actions to fulfil the Integrity Advisor role to support the effective and ongoing application of the Integrity Framework and increase integrity awareness across the ANAO. The status of these actions as at 30 June 2024 was:

Additional actions taken in 2023–24

5.2 In 2023–24 the New Zealand Office of the Auditor-General presented a webinar series on building strong national integrity systems in the Pacific region. The Integrity Advisor attended the webinars to keep abreast of how our peer audit offices in the region are strengthening integrity systems and the issues that they face in their organisations.

5.3 In May 2024 an internal mid-year integrity report was presented to EBOM with the objective of providing EBOM with more regular and timely information on how the ANAO is tracking on integrity matters. At the time the mid-year report was presented, EBOM also considered proposed additional integrity metrics for inclusion in the annual integrity report.

6.1 As set out in the ANAO Corporate Plan 2024–25 integrity and ethics continues to be an ongoing focus area for the ANAO, not only in the focus of our audit work, but also in the performance of our functions, ensuring that we maintain independence, professionalism, integrity, ethics and quality in our work.

6.2 The Parliament is increasingly seeking insights from the ANAO on the relationship between compliance and organisational culture. Compliance — not just with mandatory requirements, but also their intent — is a hallmark of integrity, and essential to the craft of public administration. The ANAO will continue to focus on providing transparency and accountability on regulatory frameworks, and the relationship with organisational culture, through our audit work.

6.3 Audit work has shown that a culture of integrity in an organisation flows from the standards set by its leaders. The ANAO will continue to focus on the ethical aspect of proper use and management of public resources, including entity governance and ethical frameworks.

6.4 In addition to the ongoing support and advisory role of the Integrity Advisor, the following table sets out the Integrity strategy and plan for 2024–25.

6.5 The Integrity Advisor will report on the status of these actions to EBOM on a six-monthly basis in line with ANAO business plan reporting.

7.1 The ANAO is satisfied that the matters noted in this report do not represent systemic or structural issues in the organisation.

7.2 While the ANAO faces challenges, risks and integrity vulnerabilities, it is positive that the risk to integrity has not been realised. The ANAO is a professional organisation of curious and critical thinkers with strong analytical capabilities who act with the highest integrity. ANAO staff believe strongly in the purpose and objectives of the ANAO and are committed to ANAO goals. The ANAO attracts people who want to make a difference and demonstrate the ANAO values. The matters raised in this report do not indicate that there are gaps in the resilience of the policies, procedures and controls that make up the ANAO Integrity Framework.

7.3 In 2024–25 the ANAO will continue to explore options for assessing the maturity of our Integrity Framework and potential risks and vulnerabilities. The ANAO will also continue to focus on embedding a pro-integrity culture supported by awareness, capability and accountability activities.