Performance audits

Our work


  • Our mandate allows us to audit the performance of all public entities, including central government departments, local authorities, schools, hospitals, and the defence force.
  • Our proposed programme of performance audits is published in our Annual Plan.
  • The product of a performance audit is a report to Parliament that will identify good practices, raise any issues or concerns, and (where necessary) recommend improvements to the public entity's performance.
  • We complete around 15 performance audits each year.
  • Performance audit reports are presented to Parliament and are available on our website and in hard copy.

What is a performance audit?

Most performance audits are carried out under section 16 of the Public Audit Act 2001. A performance audit can examine:

  • how effectively and efficiently a public entity is working;
  • whether a public entity is complying with its statutory obligations;
  • any act or omission that might waste public resources; and
  • any act or omission that might show (or appear to show) a lack of probity or financial prudence by a public entity or one or more of its members, office holders, and employees.

We report good performance and bad

We aim to provide Parliament and the public with assurance that public entities are delivering what they have been asked to and have operated lawfully and honestly. We report both good performance and bad.

Benefits for the public entities that we audit include:

  • independent assurance of their operations; and
  • guidance to improve their efficiency and effectiveness.

We do not comment on policy

The Auditor-General does not have any authority to question matters of government or local authority policy. Making policy decisions is a job for elected representatives.

For example, we would not comment on the policy direction taken by the Government or a local authority, but we could examine whether a policy was being implemented appropriately.

How we audit an entity's performance

Performance audits are usually carried out by two members of the Performance Audit Group. Performance audit staff have a mix of skills and experience in many diverse fields.

A performance audit takes about 12 months to complete, depending on its scope and complexity.

To ensure that performance audits are carried out in a professional and fair manner, we follow a set process.

Performance audit process

  • Scoping - the broad audit topic is identified through an office-wide audit planning process. Before we start the audit, we contact public entities being audited and other interested parties to seek input into the audit's scope and timing. Some performance audits will involve more than one public entity.
  • Planning - we create a set of audit criteria or expectations, against which we assess performance. We consult public entities being audited on the audit criteria used and may take expert advice.
  • Fieldwork - we collect evidence to ascertain whether our audit criteria or expectations have been met. Methodologies used include interviewing staff and stakeholders, reviewing documents and files, observation and statistical analysis. Under the Public Audit Act 2001 we can access any information we consider necessary to carry out our work. The information we collect is confidential and cannot be requested under the Official Information Act 1982.
  • Summary of findings - we analyse the evidence we have collected and draw our conclusions. We provide public entities being audited with a summary of our findings - this may be an oral briefing, a written document, or both. The public entity has a chance to comment on our audit findings.
  • Draft report - once a performance audit report is drafted, its content is checked for factual accuracy, peer reviewed and edited. Public entities being audited are given two weeks to comment on the accuracy, balance and presentation of the draft report. To maintain the Auditor-General's independence, we are not required to reach agreement on a report's content.
  • Public release of the report - the report is presented to Parliament and becomes public. We offer relevant Ministers, select committees and other interested parties briefings on the report.

Page last updated: 19 November 2019

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