Central government: Results of the 2004-05 audits.

This report serves 2 broad purposes:

  • it constitutes our “annual report” on the audits for 2004-05 of the Crown and its sub-entities – mainly as reflected in the Financial Statements of the Government of New Zealand for the Year Ended 30 June 2005 (the Government financial statements), parliamentary paper B.11, 2005; and
  • it brings to attention a number of other matters (related both directly and indirectly to events occurring in the financial year 2004-05) that we believe warrant consideration by Parliament.

Part 1 (pages 7-21) deals with the Government financial statements as audited and presented to the House. Specific topics addressed include:

  • significant matters arising from the 2004-05 audit;
  • issues that affect future financial statements; and
  • the resolution of matters raised previously.

Part 2 (pages 23-27) deals with the results of our audits of government departments for the year ended 30 June 2005. We include our usual:

  • commentary on the audit opinions on departments’ financial reports; and
  • assessments of departments’ financial and service performance management.

Part 3 (pages 29-39) sets out details of the non-standard audit reports we issued during the period 1 January 2005 to 31 December 2005 on the annual financial statements of:

  • entities that are part of the Crown reporting entity; and
  • other public entities not within the local government portfolio.

Part 4 (pages 41-50) outlines the results of our review of how well public entities are meeting the requirements of parts of the Crown Entities Act 2004, and the Public Finance Amendment Act 2004.

Part 5 (pages 51-60) describes our experience with the reformed “Controller” function performed by the Auditor-General, which changed from 1 July 2005.

Part 6 (pages 61-68) discusses the arrangements Crown Research Institutes and tertiary education institutions have in place to share the benefits of commercialising intellectual property with employees. We provide some recommendations on identifying, managing, and commercialising intellectual property.

Part 7 (pages 69-75) describes the Managing for Outcomes and Managing for Results initiatives, and why we are interested in them. We discuss the effectiveness to date of the Managing for Outcomes initiative in improving departments’ statements of intent, and describe where further work may be warranted. (The Managing for Results initiative is being implemented in the Crown entities sector from 2006-07.)

Part 8 (pages 77-84) discusses the accountability framework for Māori Trust Boards. Although we have previously expressed concerns about the audit and accountability arrangements for those Māori Trust Boards governed by the provisions of the Māori Trust Boards Act 1955, the legislative framework for the sector remains largely unchanged. We considered it timely to report on this again, because we continue to believe that a review of the Māori Trust Boards Act 1955 is urgently required.

Part 9 (pages 85-87) discusses the Register of Pecuniary Interests of Members of Parliament, and the functions of the Auditor-General in relation to the register.

Part 10 (pages 89-97) describes the results of a review we carried out after a taxpayer asserted that Instant Kiwi players were being deliberately disadvantaged by the way the Instant Kiwi games are administered by the New Zealand Lotteries Commission.

Part 11 (pages 99-106) provides an update on progress made by the central government sector in moving towards accounting and reporting in accordance with the New Zealand equivalents of International Financial Reporting Standards. We also highlight some of the implications for the sector of using the New Zealand equivalents of International Financial Reporting Standards.

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