26 June 2023

Senator the Hon Katy Gallagher
Minister for Finance
Parliament House
Canberra ACT 2600

Dear Minister

Annual Performance Statements Audit Program 2023-24

I am writing to advise of my proposal to expand the Australian National Audit Office’s (ANAO) program of audits of annual performance statements to include 14 Commonwealth entities in 2023–24, as set out in the audit program presented in the ANAO’s 2022–23 Portfolio Budget Statements. I am seeking your request in writing to proceed with the proposed audits as required under subsection 40(1) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act).

Consistent with the approach taken for the 2022-23 audit cycle, I propose to continue the program of work in 2023-24 with the 10 entities that are subject to audit in the current cycle, as outlined in your letter of 16 January 2023 (Ref: MC22-004183). This continuity helps entities to mature their performance reporting frameworks and to build capability to ensure the reporting of high-quality performance information that improves transparency and accountability of entity performance to the Parliament. This matter was reflected in our Audits of the Annual Performance Statements of Australian Government Entities — 2021–22 Report tabled in the Parliament on 9 February 2023. Continuing to work with existing audited entities also helps the ANAO to continue to evolve the audit methodology and improve the efficiency of the audit process.

In addition to the current 10 entities (see Attachment A), I propose performance statements audits be conducted on four Commonwealth entities, being the Australian Taxation Office, the Department of Foreign Affairs and Trade, the Department of Home Affairs and the National Disability Insurance Agency. Inclusion of these entities will provide additional insights to the audit program given the diversity and significance of their operations.

You will note I am seeking your request earlier than in 2022-23. This is in response to entity feedback for early engagement with the ANAO to enable entities to appropriately plan and prepare for a performance statements audit. Following your request, we will engage with all entities subject to audit in the 2023-24 audit cycle, with a particular focus on supporting the newly selected entities to prepare for the audit. I would like to be in a position to commence such engagement early in the 2023-24 financial year.

As required by subsection 40(2) of the PGPA Act, I will provide you with a copy of the audit reports on the selected entities’ compliance with the relevant provisions of the PGPA Act and the Public Governance, Performance and Accountability Rule 2014. I anticipate this will occur prior to the tabling of entities’ annual reports.

The ANAO will continue to liaise with your department and the Joint Committee of Public Accounts and Audit (JCPAA) on this program of work, including to review audit methods and outcomes each year, and will actively work with the sector to ensure ongoing improvements in the audit program, the quality of performance information reported by entities and entity capability and preparation practices.

Grant Hehir
Auditor General