Audit Legislation
The position of Auditor-General is designated as an independent
officer of Parliament within Division 3 of Part V of Victoria's
Constitution Act 1975. Provisions relating to the
appointment, operational independence and tenure of the
Auditor-General are also set out in the Constitution Act.
In March 2003, the Victorian Parliament passed amendments to the
Constitution Act that, among other things, preclude any future
change to the provisions relating to the Auditor-General other than
by way of a referendum. With this action, Parliament has reinforced
the importance it places on ensuring that the independence of the
Auditor-General in Victoria is always adequately protected.
The Audit Act 1994 establishes the legislative framework governing
the ongoing role and functions of the Auditor-General. This Act
identifies the statutory powers and responsibilities of the
Auditor-General. It provides the authority for the Auditor-General
to:
- conduct annual financial statement audits
of public sector agencies
- undertake performance audits within the
public sector which encompass assessments of the economy,
efficiency and effectiveness of the management of public resources
by the Government or individual government agencies
- examine the use of public grants received
by both private and public sector organisations
- utilise the Victorian Auditor-General's
Office as the organisational and resourcing avenue available to the
Auditor-General to assist in the discharge of the position's
legislative functions.
During June 2003, Parliament approved a range of amendments to
the Audit Act. These amendments significantly strengthen the
legislation and include:
- a capacity for the Auditor-General to
present reports to Parliament, and for the reports to be regarded
as public documents, when Parliament is in recess
- widening of the Auditor-General’s mandate
to encompass all entities controlled by the State
- assignment of an explicit power to the
Auditor-General to examine instances of waste, probity or lack of
financial prudence in the use of public resources
- provision for the Auditor-General to audit
the financial statements of a non-public body if invited, and the
Auditor-General considers it is in the public interest to do
so.
The Audit Act also addresses the special relationship
of the Auditor-General with Parliament and with Parliament's
Public Accounts
and Estimates Committee. The Act assigns several statutory
responsibilities to the committee in relation to the work of the
Auditor-General. These responsibilities include:
- review of the Auditor-General's draft
annual work plan and annual budgetary needs
- a consultative role in the formulation of
objectives and scope for all performance audits undertaken by the
Auditor-General
- provision of recommendations to Parliament
on the appointment of a financial statement auditor (annually) and
a performance auditor (every 3 years) to independently examine and
report on the quality of financial reporting and resource
management within the Victorian Auditor-General's
Office.
These legislative responsibilities of the Public Accounts and
Estimates Committee represent the means by which Parliament
protects and supports the independence of the Auditor-General and
ensures that there is adequate accountability back to it on the
ongoing use of that independence.