Foreword

Statements of corporate intent are designed to have an important accountability function for many public entities. The entities are required by law to publicly set out their intentions and activities for the forthcoming three years in their statements. The statements also provide a basis for shareholders and the wider public to assess an entity's performance. I wanted to examine the extent to which entities complied with the legislative requirements for their statements of corporate intent.

Although our performance audit found broad compliance with legislative requirements for the statements, the exceptions to this compliance were disappointing. We also found mixed results with the quality of performance targets used by some public entities to measure their performance and later report on that performance to shareholders and the public in annual reports. Public entities need to ensure that they routinely comply with all their legislative requirements.

These findings have raised some wider questions for me about whether the original intention of using statements of corporate intent for public accountability is being fulfilled. In particular, I am interested in the importance given to the statements by public entities and their shareholders. This includes assessing the extent to which public entities and shareholders meaningfully interact about the content of statements of corporate intent. It is also important to explore other accountability methods that are being used by public entities and their shareholders that serve to reduce the importance of the statements.

I intend to look into these issues further. In the meantime, I have made some specific recommendations in this report, which I encourage all public entities required to produce a statement of corporate intent to follow.

K B Brady
Controller and Auditor-General

18 June 2007