Tabling a report of her annual review of financial audits across the State’s Public Service entities for the past year, Auditor General Caroline Spencer declared her findings were of ‘great concern” due to the number of entities with serious deficiencies.
Releasing her report Annual 2020-21 Financial Audits of State Government Entities, Ms Spencer said the entities had failed requiring qualified opinions on financial statements, controls or key performance indicators.
“A total of 17 State Government entities received qualified audit opinions on 31 separate matters,” Ms Spencer said, “an increase from seven entities and 11 matters last year — the most audit qualifications ever issued by this office.”
“This is a very concerning and significant upward trend in audit qualifications, particularly in controls around expenditure, payroll and information systems,” she said.
Ms Spencer said the shortcomings most likely reflected that the Public Sector was resource-constrained in some areas and COVID-19 fatigued and diverted.
She said the audits also identified 427 financial management and 403 information system control weaknesses.
“While these figures are comparable with 2019-20, of concern is the number of issues that are unresolved from last year — 28 per cent of the financial management and 49 per cent of the information system weaknesses,” Ms Spencer said.
“The proportion of unresolved financial management weaknesses has increased from 20 per cent two years ago.”
The Auditor General said it was not uncommon to see a breakdown in some controls during times of increased tempo and uncertainty, but an effective control environment was essential for enabling an entity to achieve its objectives and to help prevent and detect fraud.
“It is also essential to ensure continued delivery of quality services to the community,” she said.
“This year’s report also contains our reporting of important issues and trends identified from our audit of the Annual Report on State Finances, with the general Government sector realising a record operating surplus of $5.8 billion in 2020-21.”
Ms Spencer said entities must ensure the highest standard of financial management and public administration so that this money could deliver the best possible economic and social outcomes for the community.
The 81-page Audit Report can be accessed at this PS News link.
