Estimates of appropriations

Vote Audit - Finance and Government Administration Sector - Estimates 2016/2017

APPROPRIATION MINISTER(S): Speaker of the House of Representatives (M78)

APPROPRIATION ADMINISTRATOR: Controller and Auditor-General

RESPONSIBLE MINISTER FOR CONTROLLER AND AUDITOR-GENERAL: Speaker of the House of Representatives

Overview of the Vote#

The Speaker of the House of Representatives is responsible for appropriations in the Vote for the 2016/17 financial year covering the following:

  • A total of $9.857 million for the Controller and Auditor-General supporting Parliament in ensuring accountability for the use of public resources. This includes providing advice to select committees and other stakeholders, carrying out the Controller function, and carrying out and reporting on performance audits and inquiries relating to public entities.
  • A total of $77.095 million for providing audit services to public entities, and other audit-related assurance services. This is largely funded by fee revenue, but includes $150,000 funded by revenue from the Crown for audits of smaller entities such as cemetery trusts and reserve boards.
  • A total of $958,000 for remuneration expenses for both the Auditor-General and the Deputy Auditor-General.
  • A total of $785,000 for the purchase or development of assets for the use of the Controller and Auditor-General.

Details of these appropriations are set out in Parts 2-4.

Details of Appropriations and Capital Injections#

Annual and Permanent Appropriations#

  2015/16 2016/17
Titles and Scopes of Appropriations by Appropriation Type Final
Budgeted
$000
Estimated
Actual
$000
Budget
$000

Departmental Output Expenses

     

Audit and Assurance Services RDA (M78)

This appropriation is limited to audit and related assurance services as required or authorised by statute.
75,864 75,724 75,295

Audit and Assurance Services (M78)

This appropriation is limited to the performance of audit and related assurance services as required or authorised by statute.
650 150 1,800

Total Departmental Output Expenses

76,514 75,874 77,095

Departmental Other Expenses

     

Remuneration of Auditor-General and Deputy Auditor-General PLA (M78)

This appropriation is limited to remuneration expenses for both the Auditor-General and the Deputy Auditor-General as authorised by clause 5 of the Third Schedule of the Public Audit Act 2001.
972 972 958

Total Departmental Other Expenses

972 972 958

Departmental Capital Expenditure

     

Controller and Auditor-General - Capital Expenditure PLA (M78)

This appropriation is limited to the purchase or development of assets by and for the use of the Controller and Auditor-General, as authorised by section 24(1) of the Public Finance Act 1989.
1,415 1,415 785

Total Departmental Capital Expenditure

1,415 1,415 785

Multi-Category Expenses and Capital Expenditure

     

Statutory Auditor Function MCA (M78)

The overarching purpose of this appropriation is to support Parliament in ensuring accountability for the use of public resources.
9,857 9,681 9,857
Departmental Output Expenses
     
Performance Audits and Inquiries
This category is limited to undertaking and reporting on performance audits and inquiries relating to public entities under the Public Audit Act 2001 and responding to requests for approvals in relation to pecuniary interest questions regulated by the Local Authorities (Members' Interests) Act 1968.
6,587 6,356 6,587
Supporting Accountability to Parliament
This category is limited to reporting to Parliament and others as appropriate on matters arising from audits and inquiries, reporting to and advising select committees, and advising other agencies in New Zealand and abroad to support Parliament and governing bodies in holding their executives to account for the use of public resources.
3,270 3,325 3,270

Total Multi-Category Expenses and Capital Expenditure

9,857 9,681 9,857

Total Annual and Permanent Appropriations

88,758 87,942 88,695

Capital Injection Authorisations#

  2015/16 2016/17
  Final Budgeted
$000
Estimated Actual
$000
Budget
$000
Controller and Auditor-General - Capital Injection (M78) - - -

Supporting Information#

Part 1 - Vote as a Whole#

This part provides trend information for the vote.

Summary of Financial Activity#

  2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20
  Actual
$000
Actual
$000
Actual
$000
Actual
$000
Final Budgeted
$000
Estimated
Actual
$000
Departmental
Transactions
Budget
$000
Non-
Departmental
Transactions
Budget
$000
Total
Budget
$000
Estimated
$000
Estimated
$000
Estimated
$000

Appropriations

                       
Output Expenses 70,728 69,448 71,756 76,503 76,514 75,874 77,095 - 77,095 82,481 81,016 82,206
Benefits or Related Expenses - - - - - - N/A - - - - -
Borrowing Expenses - - - - - - - - - - - -
Other Expenses 848 883 923 950 972 972 958 - 958 958 958 958
Capital Expenditure 1,154 3,801 1,028 974 1,415 1,415 785 - 785 1,469 1,087 842
Intelligence and Security Department Expenses and Capital Expenditure - - - - - - - N/A - - - -
Multi-Category Expenses and Capital Expenditure (MCA)                        
Output Expenses 8,838 9,065 8,800 9,012 9,857 9,681 9,857 - 9,857 9,857 9,857 9,857
Other Expenses - - - - - - - - - - - -
Capital Expenditure - - - - - - N/A - - - - -

Total Appropriations

81,568 83,197 82,507 87,439 88,758 87,942 88,695 - 88,695 94,765 92,918 93,863

Crown Revenue and Capital Receipts

                       
Tax Revenue - - - - - - N/A - - - - -
Non-Tax Revenue - - - - - - N/A - - - - -
Capital Receipts - - - - - - N/A - - - - -

Total Crown Revenue and Capital Receipts

- - - - - - N/A - - - - -

Note - where restructuring of the vote has occurred then, to the extent practicable, prior years information has been restated as if the restructuring had occurred before the beginning of the period covered. In this instance Total Appropriations for the Budgeted and Estimated Actual year may not equal Total Appropriations in the Details of Appropriations and Capital Injections.

Adjustments to the Summary of Financial Activity Table Due to Vote Restructuring#

There have been no restructuring adjustments to prior year information in the Summary of Financial Activity table.

Output expenses in the financial years ended June 2012, 2015 and 2018 are higher as these years include the triennial audits of Councils' long-term plans. Higher capital expenditure during 2012/13 reflects the fit-out of Wellington premises for the Controller and Auditor-General.

Part 2 - Details of Departmental Appropriations#

2.1 - Departmental Output Expenses#

Audit and Assurance Services RDA (M78)

Scope of Appropriation

This appropriation is limited to audit and related assurance services as required or authorised by statute.

Expenses and Revenue

  2015/16 2016/17
  Final Budgeted
$000
Estimated Actual
$000
Budget
$000
Total Appropriation 75,864 75,724 75,295
Revenue from the Crown - - -
Revenue from Others 75,864 75,855 75,295

What is Intended to be Achieved with this Appropriation

This appropriation is intended to deliver audit services to all public entities, and other audit-related assurance services to enable Parliament to have independent assurance that public entities are accountable for their performance in the way that Parliament intended.

How Performance will be Assessed and End of Year Reporting Requirements

Performance for this Appropriation will be assessed by the performance measures listed below. These measures need to be considered in the context of the high level outcomes outlined in the Auditor-General's strategic intentions 2014/15 to 2017/18 and in the context of the Auditor-General's 2016/17 Annual Plan.

  2015/16 2016/17
Assessment of Performance Final Budgeted
Standard
Estimated
Actual
Budget
Standard

Key recommendations our auditors include in management reports are accepted, and acted on.

At least 70% At least 70% At least 70%

Public entities' audited reports are signed by the statutory timeframe.

At least 75% At least 75% At least 75%

Audit reports not signed by the statutory timeframe are because of inaction on our part.

Less than 30% Less than 30% Less than 30%

Management reports are issued within six weeks of issuing the audit report.

100% 100% 100%

Long-term plan (LTP) audit opinions are signed by 30 June (unless upheld by the local authority).

N/A N/A N/A

Long-term plan (LTP) management reports are issued within six weeks of issuing the LTP audit opinion.

N/A N/A N/A

Annual independent review confirms the probity and objectivity of the methods and processes we use to allocate and tender audits, and monitor the reasonableness of audit fees.

Confirmation by annual independent review Confirmation by annual independent review Confirmation by annual independent review

Respondents from our satisfaction survey of public entities who are satisfied with their audit (including the expertise of audit staff and the public entity's relationship with those staff).

At least 85% At least 85% At least 85%

Appointed auditors who have a quality assurance grade of at least "satisfactory", based on our most recent quality assurance review.

100% 95% 100%

End of Year Performance Reporting

Performance information for this appropriation will be reported in the Auditor-General's 2016/17 Annual Report.

Memorandum Account

  2015/16 2016/17
  Final Budgeted
$000
Estimated Actual
$000
Budget
$000

Name of Memorandum Account

     
Opening Balance at 1 July 2,345 2,345 2,476
Revenue 75,864 75,855 75,295
Expenses 76,038 75,724 76,602
Transfers and Adjustments - - -

Closing Balance at 30 June

2,171 2,476 1,169

Audit and Assurance Services (M78)#

Scope of Appropriation#

This appropriation is limited to the performance of audit and related assurance services as required or authorised by statute.

Expenses and Revenue#

  2015/16 2016/17
  Final Budgeted
$000
Estimated Actual
$000
Budget
$000
Total Appropriation 650 150 1,800
Revenue from the Crown 150 150 150
Revenue from Others - - -

What is Intended to be Achieved with this Appropriation#

This appropriation is intended to provide for audit and related assurance services. Audits of smaller entities such as cemetery trusts and reserve boards are funded by the Crown.

How Performance will be Assessed and End of Year Reporting Requirements#

Performance for this appropriation will be assessed through the performance measures listed under Audit and Assurance Services RDA on pages 8 and 9.

End of Year Performance Reporting#

Performance information for this appropriation will be reported in the Auditor-General's 2016/17 Annual Report.

Reasons for Change in Appropriation#

The increase in this appropriation for 2016/17 of $1.150 million relates to an allowance for a forecast deficit in the Audit and Assurance Services memorandum account funded by the accumulated balance in that account.The increase in this appropriation for 2016/17 of $1.150 million relates to an allowance for a forecast deficit in the Audit and Assurance Services memorandum account funded by the accumulated balance in that account.

2.2 - Departmental Other Expenses#

Remuneration of Auditor-General and Deputy Auditor-General PLA (M78)#

Scope of Appropriation

This appropriation is limited to remuneration expenses for both the Auditor-General and the Deputy Auditor-General as authorised by clause 5 of the Third Schedule of the Public Audit Act 2001.

Expenses

  2015/16 2016/17
  Final Budgeted
$000
Estimated Actual
$000
Budget
$000
Total Appropriation 972 972 958

What is Intended to be Achieved with this Appropriation

This permanent appropriation provides payment to the Auditor-General and Deputy Auditor-General as determined by the Remuneration Authority.

How Performance will be Assessed and End of Year Reporting Requirements

The Auditor-General and Deputy Auditor-General lead the performance of the Office. The performance of the Office's activities, including the above payment, is reflected in the information for departmental output and multi-category appropriations.

End of Year Performance Reporting

Performance information for the Office will be reported in the Auditor-General's 2016/17 Annual Report.

2.3 - Departmental Capital Expenditure and Capital Injections#

Controller and Auditor-General - Capital Expenditure PLA (M78)#

Scope of Appropriation

This appropriation is limited to the purchase or development of assets by and for the use of the Controller and Auditor-General, as authorised by section 24(1) of the Public Finance Act 1989.

Capital Expenditure

  2015/16 2016/17
  Final Budgeted
$000
Estimated Actual
$000
Budget
$000
Forests/Agricultural - - -
Land - - -
Property, Plant and Equipment 500 500 375
Intangibles 403 403 220
Other 512 512 190

Total Appropriation

1,415 1,415 785

What is Intended to be Achieved with this Appropriation

This appropriation is intended to achieve the renewal of assets that support of the delivery of the Controller and Auditor-General's operations.

How Performance will be Assessed and End of Year Reporting Requirements

Expenditure is in accordance with the Controller and Auditor-General's capital asset management plan.

End of Year Performance Reporting

Performance information for this appropriation will be reported in the Auditor-General's 2016/17 Annual Report.

Reasons for Change in Appropriation

The decrease in this appropriation for 2016/17 is mainly due to lower forecast vehicle purchases arising from varying numbers of vehicles coming due for replacement each year. Expenditure on software purchases is also expected to be lower in 2016/17.

Capital Injections and Movements in Departmental Net Assets

Controller and Auditor-General

Details of Net Asset Schedule 2015/16
Estimated Actual
$000
2016/17
Projected
$000
Explanation of Projected Movements in 2016/17
Opening Balance 8,566 8,697  
Capital Injections - -  
Capital Withdrawals - -  
Surplus to be Retained (Deficit Incurred) 131 (1,307) The surplus to be retained or deficit incurred reflects amounts that will be held in or used from the Audit and Assurance Services Memorandum Account
Other Movements - -  

Closing Balance

8,697 7,390  

Part 4 - Details of Multi-Category Expenses and Capital Expenditure#

Multi-Category Expenses and Capital Expenditure#

Statutory Auditor Function (M78)

Overarching Purpose Statement

The overarching purpose of this appropriation is to support Parliament in ensuring accountability for the use of public resources.

Scope of Appropriation

Departmental Output Expenses
Performance Audits and Inquiries
This category is limited to undertaking and reporting on performance audits and inquiries relating to public entities under the Public Audit Act 2001 and responding to requests for approvals in relation to pecuniary interest questions regulated by the Local Authorities (Members' Interests) Act 1968.
Supporting Accountability to Parliament
This category is limited to reporting to Parliament and others as appropriate on matters arising from audits and inquiries, reporting to and advising select committees, and advising other agencies in New Zealand and abroad to support Parliament and governing bodies in holding their executives to account for the use of public resources.

Expenses, Revenue and Capital Expenditure

  2015/16 2016/17
  Final Budgeted
$000
Estimated Actual
$000
Budget
$000

Total Appropriation

9,857 9,681 9,857

Departmental Output Expenses

     
Performance Audits and Inquiries 6,587 6,356 6,587
Supporting Accountability to Parliament 3,270 3,325 3,270

Funding for Departmental Output Expenses

     

Revenue from the Crown

9,627 9,627 9,627
Performance Audits and Inquiries 6,587 6,587 6,587
Supporting Accountability to Parliament 3,040 3,040 3,040

Revenue from Others

230 180 230
Supporting Accountability to Parliament 230 180 230

What is Intended to be Achieved with this Appropriation

This appropriation is intended to support Parliament in ensuring accountability for the use of public resources through:

  • Services to Parliament - assistance and assurance to select committees and other stakeholders.
  • Controller function - assurance to Parliament that spending has been properly incurred within appropriation.
  • Reports, Studies and Inquiries - reporting on the results of annual audits, performance audits and other studies and inquiring into a public entity's use of resource.

How Performance will be Assessed for this Appropriation

Performance for this Appropriation will be assessed through the performance measures listed below. These measures need to be considered in the context of the Auditor-General's strategic intentions 2014/15 to 2017/18, and the Auditor-General's 2016/17 Annual Plan.

  2015/16 2016/17
Assessment of Performance Final Budgeted
Standard
Estimated
Actual
Budget
Standard

Quality standards are consistently met: stakeholders surveyed who confirm relevance of our work to users and reports independently reviewed that are assessed as high quality.

At least 85% for stakeholders and 100% for reports At least 85% for stakeholders and 100% for reports At least 85% for stakeholders and 100% for reports

Process standards are consistently met: external review and internal quality assurance review confirm our performance audit process standards are consistently complied with and our policies and procedures for statutory auditor functions meet relevant standards.

Confirmation by external and internal review Confirmation by external and internal review Confirmation by external and internal review

What is Intended to be Achieved with each Category and How Performance will be Assessed

  2015/16 2016/17
Assessment of Performance Final Budgeted
Standard
Estimated
Actual
Budget
Standard

Departmental Output Expenses

     

Performance Audits and Inquiries

     

This category is intended to provide Parliament with assurance about how well public entities use resources and manage a range of matters and programmes, making recommendations where we consider improvements can be made.

     

Entities accept the key recommendations made in our reports, and the recommendations influence improvement.

As assessed in follow up reports As assessed in follow up reports As assessed in follow up reports

Findings on inquiries reported to the relevant parties within three months for routine inquiries, six months for significant inquiries and 12 months for major inquiries.

At least 80% 80% At least 80%

Local Authorities (Members' Interests) Act 1968 (LAMIA) matters that are completed within 30 working days.

At least 80% 80% At least 80%

Supporting Accountability to Parliament

     

This category is intended to provide advice and assistance to Parliament and our other stakeholders to assist them in their work to improve the performance and accountability of public entities. Our Controller function provides independent assurance to Parliament that public money has been spent appropriately and lawfully.

     

Stakeholders we survey who confirm that our advice assists them.

At least 85% At least 85% At least 85%

Select committees and other stakeholders are satisfied with the proposed work programme (as indicated by feedback on our draft annual work programme).

Stakeholders are satisfied Stakeholders are satisfied Stakeholders are satisfied

Projects in the programme of work under this output class that are delivered within their planned timeframes.

At least 75% Less than 75% At least 75%

Briefings given to select committees at least two days before an examination, unless otherwise agreed.

100% 100% 100%

Controller function: monthly statements provided by the Treasury are reviewed for the period September to June inclusive. Advice of issues arising and action to be taken is provided to the Treasury and appointed auditors within the five working days of receipt of the statement.

Procedures followed and agreed timeframes met Procedures followed and agreed timeframes met Procedures followed and agreed timeframes met

End of Year Performance Reporting

Performance information for this Appropriation will be reported in the Auditor-General's 2016/17 Annual Report.