The Auditor-General undertakes financial audits for over 580 public sector entities each year. The Auditor-General uses VAGO staff to undertake around a third of these financial report audits. For the remaining financial report audits, the Auditor-General contracts private sector firms (audit service providers) to assist with these. VAGO reviews this work and all audit opinions are issued on behalf of the Auditor-General.
In addition, some entities are also required to produce audited performance statements, which detail performance indicator targets and outcomes with supporting commentary. We audit these alongside our financial report audits.
Financial report audits are conducted in accordance with the Australian Auditing Standards using a risk-based approach. We plan our audits based on our understanding of the entity, which involves assessing any risks that may significantly affect the entity’s financial report. This includes assessing the effectiveness of any internal controls the entity has in place that could prevent or detect and correct such risks.
We design and perform our audits to obtain sufficient and appropriate audit evidence that the assessed risks have been appropriately addressed and the prepared financial reports present fairly in accordance with the entity’s financial reporting requirements. At the end of our audit, we issue an independent auditor’s report containing our opinion on whether or not the financial report fairly presents the financial performance and position of the entity, and if it has been prepared in accordance with the entity’s financial reporting requirements. The entity includes our opinion in its annual report.
In addition to the financial report audits, the Auditor-General conducts a review of the State of Victoria’s Estimated Financial Statements for the General Government Sector included in the state budget.