2. Conduct of the Review

2.1.
Initial discussions concerning the conduct of the Review took place in Wellington on 23 and 24 November 2006 between the Review Coordinator and the Controller and Auditor-General and Deputy Controller and Auditor-General. These discussions also provided an opportunity for familiarisation with the OAG and Audit New Zealand, as did discussions with senior staff at the time (see Attachment 3). Further Review preparation included examination of Background Documents (see Attachment 4) and a range of other Documents provided by the Office which were added to progressively over the Review period (see Attachment 6). These Documents included the previous Peer Review of the New Zealand Audit Office in 2001 under the auspices of the Australasian Council of Auditors-General, and the most recent Peer Review by the Australian National Audit Office of two performance audits prepared by the Performance Audit Group within the OAG. As noted in Attachment 3, the Review Coordinator had discussions with the latter Peer Review Team in Wellington on 23 November 2006 and in Canberra on 13 December 2006.

2.2.
The extensive nature and content of the foregoing discussions and documentation provided had two main benefits. They allowed for a considerable range of issues and views to be considered by the Review Team well before the on-site review conducted in September. As a result, the Team had the opportunity to be better prepared and focussed to make best use of their time in Wellington, including further interviews with nominated stakeholders and those requesting interviews with the Team. The pre-review activities were a factor in determining the dates for the on-site review. It was decided that a two week period from 17 to 28 September was appropriate. One Member of the Team located in Wellington was able to commence interviews in the week beginning 10 September, which proved to be of considerable assistance in completing an extensive range of interviews.

2.3.
Following consideration of the Terms of Reference, it was decided that the Review would cover three segments of the operations of the Office as follows:

• Governance and Management (including all Corporate Services)
• Financial Statement and Assurance Auditing (including the Controller Function and LTCCP audits); and
• Performance Auditing, Good Practice Guides and Inquiries.

2.4.
Review Team Members were selected on the basis of experience and professional background and qualifications in each of these three areas. Because of the extent of activity and resources involved in the second segment above, the Controller and Auditor-General agreed to have two Team Members cover that segment. Obviously, there were both overarching and common issues impacting on all three segments that needed to be coordinated to avoid unnecessary duplication of activity. While all Team Members were sufficiently experienced to manage this situation effectively, it was also apparent that the Review would benefit from their different perceptions of the issues. This was considered particularly relevant to ensuring a more cohesive organisation involving the respective roles of, and the relationships between, the OAG (as described at sub-section 4.2.1) and Audit New Zealand (as described at sub-section 5.8.1).