767-801. Auditor (in) dependence and its impact on financial management, Public Administration Review, Vol. Empirically, the, Performance auditing as an audit discipline has developed seriously since the late 1970s. We adopt a structured literature review (SLR) approach to address this gap. Our analysis reveals that audits conducted by government supreme audit institutions seek to understand if NPM has influenced audit reporting (Pollitt and Summa, 1997) and, in more recent years, whether reporting can deliver public value (Jeppesen et al., 2017; Cordery and Hay, 2019). Kontogeorga, G.N. The audit team sets out the objective, scope, and criteria in a key planning document called the audit logic matrix. Barrett, P., (2019), New development: Managing risk for better performance not taking a risk can actually be a risk, Public Money and Management, pp. In doing so, we identify opportunities for future investigation. The audit team incorporatesfinal changes into the text that have been agreed to with the entity, as well as the entity responses, and issues the transmission draft to the entity. 150 Nos 1/2, pp. The subject of an audit can be a government entity or activity (business line), a sectoral activity, or a government-wide functional area. A national audit office VFM study, Public Administration, Vol. 29 No. 2, pp. 2, pp. Wilkins, P., (1995), Performing auditors? 32 No. How have organisations fared when assessed in this context on their economy, efficiency and effectiveness? ), Oxford Handbook of Governance, Oxford University Press, Oxford. Supreme audit institutions at a critical juncture, Property Rights and the Limits of Democracy, Post Socialist Political Economy: Selected Essays, Changes in the public sector: a review of recent 'alternative' accounting research, Public sector to public services: 20 years of 'contextual' accounting research, Evaluating the New public management reforms in the UK: a constitutional possibility, Audit recommendation follow-up systems: a survey of the states, A few good men: public sector audit in the Swan River Colony, Public sector audit history in Britain and Australia, The surveillance of a supreme audit institution on related party transactions, Insights into current practices in auditing environmental matters, Financial auditors and environmental matters: drivers of change to current practices, Journal of Accounting and Organizational Change, The public sector audit expectations gap in Bangladesh, Diffusion of corporate riskmanagement characteristics: perspectives of chief audit executives through a survey approach, Australian Journal of Public Administration, Contribution of internal auditing to risk management, International Journal of Public Sector Management, Audit committee best practice disclosure: cluster analyses to determine strengths and weaknesses, Effects of municipal, auditing and political factors on audit delay, Explaining municipal audit costs in Sweden: reconsidering the political environment, the municipal organisation and the audit market, Political and organisational legitimacy of public sector auditing in New Zealand local government, U.S. imperialism in action: an audit-based appraisal of the coalition provisional authority in Iraq, The association between municipal disclosure practices and audit quality, Internal audit, alternative internal audit structures and the level of misappropriation of assets fraud, Supreme audit institutions and public value: demonstrating relevance, Undertaking a literature review: a step-by-step approach, A multi-dimensional framework of organisational innovation: a systematic review of the literature. 147-160. Our analysis reveals that theories began in the NPM period and consolidated in the NPG period. Performance Auditing: The Experiences of the United States Government Cordery, C.J Hay, D., (2021), Public Sector Audit, Routledge, London. (2019), Navigating through the spatial and institutional contradictions of public audit oversight, European Accounting Review, Vol. The achievement of these outcomes does not lie wholly within the control of the audit team. Consistent with reforms made according to NPM philosophies, some studies analysed privatisation and the market role in this scenario. . endobj Focusing on significance to Parliament, the Auditor General has the final say on theaudit reportmessages, tone and structure, and the appropriateness of conclusions and recommendations. 10 No. In addition to complying with these CPA Canada standards, the OAG has policies in place for aspects of performance audits for which CPA Canada standards do not apply, however these policies are intended communicate legal and other requirements, as well as to help auditors comply with applicable direct engagement standards. Broadbent, J. and Laughlin, R. (1997), Evaluating the New public management reforms in the UK: a constitutional possibility, Public Administration, Vol. 23 No. Approaches to internal audit have changed in recent years (Nerantzidis et al., 2020), with previous studies focusing on the independence of auditors and more recently published studies analysing the relationships between internal audit functions and financial management performance in the public sector (Iskandar et al., 2014) as the internal audit is seen as a component of the combined assurance model, together with the audit committee, management and external auditors. Moreover, the role of auditors who enable changes (e.g. 541-567. 278-310. Chiang, C., Northcott, D., (2012), Financial auditors and environmental matters: drivers of change to current practices, Journal of Accounting and Organizational Change, Vol. Magrane, J. and Malthus, S. (2010), Audit committee effectiveness: a public sector case study, Managerial Auditing Journal, Vol. 20 No. This amendment gave the Auditor General the powers, at his discretion, to inquire into the use of federal grants, contributions, or loans, even when they are transferred outside government. We also call for more research on INTOSAI. Public sector organisations may include hospitals and other health care facilities such as ambulance services, schools and universities, the police force and organisations responsible for public transport and the road network. and de Fine Licht, J. We found an additional 91 articles using the inclusion criteria. Therefore a very wide range of performance information may be required yet it would be pointless to set targets and produce performance information on an issue which is not relevant to any stakeholder. 224-246. To analyse the theoretical approach used by scholars in the eligible papers, we categorised the different theories used and allocated them as economic theories or systems-oriented theories. Determinants in elections for presidents of supreme audit institutions. 912-933. Working together, we chose the exclusion criteria in advance. 4, pp. 9 No. Our total sample for analysis comprised 199 papers. Thomasson, A., (2018), Politicisation of the audit process: the case of politically affiliated auditors in Swedish local governments, Financial Accountability and Management, Vol. 423-441. 3, pp. Morin, D., (2003), Controllers or catalysts for change and improvement: would the real value for money auditors please stand up?, Managerial Auditing Journal, Vol. 546-555. The construction of auditing expertise in measuring government performance, Audit committees in Scottish local authorities 19982005, Making Management Auditable: The Implementation of Best Value in Local Government, Auditors generals universe revisited: An exploratory study of the influence they exert on public administration through their value for money audits. Natalicchio, A., Ardito, L., Savino, T., Albino, V., (2017), Managing knowledge assets for open innovation: a systematic literature review, Journal of Knowledge Management, Vol. A Wider Accountability? Many articles (153) do not apply any theoretical framework, consistent with previous studies (Goddard, 2010; Jacobs, 2012). Appel, J.J., Plant, K., (2015), A framework for internal auditors to assess ethics in a national public sector department, Southern African Journal of Accountability and Auditing Research, Vol. Auditors working under an NPG logic use value for money (VFM) audits to assess how economic, effective and efficient is the management of the audited organisations (Morin, 2001). Staff members will possess an appropriate level of expertise for any work contemplated. Further guidance on matters of access is provided in the following documents: A performance audit has three main phases: planning the audit, conducting the examination, and reporting. Exhibit 4Roadmap to the OAG performance audit process. 2, pp. Additionally, 47 articles among our sample rely on quantitative methods, 26 are conceptual papers and 11 are based on mixed methods. 36-39. 72-83. Fleming, S., McNamee, M., (2005), The ethics of corporate governance in public sector organisations: theory and audit, Public Management Review, Vol. 59 No. 479-487. <> Its growth parallels the evolu- tion of politics and public administration from one-dimensional focus on control of. Chiang, C. (2010), Insights into current practices in auditing environmental matters, Managerial Auditing Journal, Vol. The auditors role here is usually to report on the credibility, usefulness and accuracy of the reported performance. 35 No. 377-410. What auditing standards have been set for public sector organisations and are these different for the private sector? Forensic audits may be conducted to determine if wrongdoing occurred, or to gather evidence for the case against an alleged criminal. 76, pp. (Ed. When sufficient and appropriate evidence has been gathered to support clear audit findings, drafting theaudit reportfor internal circulation begins. 8, pp. 368-385. 21 No. This is consistent with the previous literature, which emphasises that articles must be relevant to the investigated topic (Natalicchio et al., 2017; Crossan and Apaydin, 2010; Savino et al., 2017). establish audit objectives and identify suitable criteria for the assessment of management performance in the areas of government activities to be audited; gather the evidence necessary to assess the performance of management against those criteria; conclude against established audit objectives; make recommendations to management, when appropriate, to deal with significant variances between a criterion (or criteria) and performance; and. 229-243. Resolving Conflict: Strategies for Local Government, International City/County Management Association, Washington, DC. The Auditor General Act does not define the means by which the performance audit responsibilities are to be discharged. 3, pp. 1, pp. 1154-1191. 2, pp. First, we selected and categorised relevant literature in the field. 158-181. Determinants in elections for presidents of supreme audit institutions, Managerial Auditing Journal, Vol. 255-269. In the OAGs case, the intended users are Parliament and the legislative assemblies of the territories. 31 No. 3, pp. English, L., (2003), Emasculating public accountability in the name of competition: transformation of state audit in Victoria, Critical Perspectives on Accounting, Vol. Section 2 discusses public sector auditing over time, while Section 3 outlines the method used to select literature for review and examines in further detail some of the key publications in the public sector auditing field. Small world? Power, M., (1994), The audit society, in Hopwood, A.G. and Miller, P. (Eds), Accounting as Social and Institutional Practice, Cambridge University Press, Cambridge. The audit must be planned, performed, and reported to meet OAG policies and applicable professional standards. Exploring divergent causal mechanisms through three Honduran cases, Pick and Roll: Expanded roles for a state auditor, Auditor or Adviser? PDF ISSAI 100 Fundamental Principles of Public Sector Auditing Gonzlez-Daz, B., Garca-Fernndez, R. and Lpez-Daz, A. Another avenue is to audit whole-of-government financial reports and governmental agency and decentralised entity reports (Pallot, 2003). From 2009 onwards, scholars were more inclined to use theories in their work. stream 133-156. 1, pp. 583-599. 1, pp. 13 No. 3, pp. 37 No. Development of performance audit in public sector - ResearchGate The Office of the Auditor General is responsible for legislative auditing of the federal and territorial governments. 15-33. 1 0 obj The Auditor General submits reports on performance audits to the House of Commons, including follow-up work, which examines progress made by the government in responding to recommendations contained in previous performance audits. Performance audits seek to determine whether public sector entities are delivering programs or carrying out activities and processes with due regard to one or more of the principles of economy, efficiency, and effectiveness. These may not be modified, copied or distributed in any form as this would infringe CPA Canadas copyright. 22-47. 4, pp. Knafo, S., (2019), Neoliberalism and the origins of public management, Review of International Political Economy, Vol. 12 No. Performance audits are also implemented in the business sector and follow many of the same stated goals and procedures. Bandyopadhyay, S.P. Rika, N. and Jacobs, K. (2019), Reputational risk and environmental performance auditing: a study in the Australian commonwealth public sector, Financial Accountability & Management, Vol. Schelker, M., (2012), The influence of auditor term length and term limits on US state general obligation bond ratings, Public Choice, Vol. Of course, the procedures must be specifically tailored to the performance information subject to the audit. The results are highlighted in Section 4, while Section 5 concludes, providing suggestions for future research directions. 9 No. 6, pp. The final versions of these responses are included in the published report. 29 No. Public sector external audit - Present and future - LinkedIn 61 No. What are the main gaps in the existing public sector auditing literature? Learn how corporate governance impacts your investments. 536-558. 4, pp. NPM introduced accrual accounting and associated financial statements into the public sector and made public sector auditing more like corporate audits, focusing on standards and formal annual financial statements. 3, pp. Purpose This study aims to analyze the effect of audit findings and audit recommendations follow-up on the quality of financial reports and the quality of public services in the context of. 4, pp. The organisations should aim to demonstrate that public monies allocated to them are being used effectively, that specific targets are being met, and that appropriate decisions are being made in respect of long term planning. Are performance audits useful? The principle of effectiveness involves meeting the objectives set and achieving the intended results. 911-931. In the NPG period, citizens are positioned as co-producers (Almqvist et al., 2013; Wiesel and Modell, 2014; Mussari et al., 2021; Ruggiero et al., 2021), and involved in the decision-making process (Wiesel and Modell, 2014; Innes and Booher, 1999; Himmelman, 1994), which increases the need for legitimacy, rather than a narrow focus on effectiveness as in the NPM period (Cordery and Hay, 2021; Hay and Cordery, 2021). (2008), Making management auditable: the implementation of best value in local government, Abacus, Vol. they result in changes made by government in areas where the Auditor General has found that improvements are needed. Contesting Claims on Measuring Performance in the Public Sector Using Is auditing the new evaluation?