Appendix 1 flowchart

Flowchart to assist in determining whether a situation of circumstance complies with the fundamental principles and the Auditor-General’s independence requirements in the Guide.

1. Does the situation or circumstance involve the provision of services1 for, or in relation to,2 a public entity audited by the Audit Service Provider on behalf of the Auditor-General?

  • If YES, proceed to step 2
  • If NO, proceed to step 3

2. Complete the flowchart in Appendix 2.1 that provides guidance on what additional work can be provided to entities.

  • Upon completion of step 2, stop.

3. Does the situation or circumstance threaten compliance with the fundamental principles, other than the fundamental principle of “objectivity” (independence)?

  • If YES, proceed to step 4
  • If NO, proceed to step 5

4. Apply the applicable requirements in Parts 1 and 3 of the Guide with particular attention to the reasonable and informed third party test described in paragraphs AG R120.5 A6.1 and AG R120.7 A1.1.

  • Upon completion of step 4, stop.

5. Does the situation or circumstance threaten the fundamental principle of “objectivity” (independence)?

  • If YES, proceed to step 6
  • If NO, proceed to step 7

6. Apply the applicable requirements in Parts 1, 3 and 4A of the Guide with particular attention to the reasonable and informed third party test described in paragraphs AG R120.15 A1.2 to AG R120.15 A1.4 and the application material in paragraph AG 120.15 A1.5.

  • Upon completion of step 6, stop.

7. The situation or the circumstance will normally comply with the fundamental principles and the Auditor-General's independence requirements. If there is any remaining uncertainty, refer the matter to the OAG for a ruling at independence@oag.parliament.nz.

Footnote 1: In the context of this decision tree “services” consist of:
a) “Work of an assurance nature” as defined in this Guide (refer to flowchart in Appendix 2.3); and
b) All services other than “work of an assurance nature” as defined in (a) above.

Footnote 2: Please note that the “services" may be requested by an entity, other than the public entity audited by the Audit Service Provider on behalf of the Auditor-General. There is a possibility that those “services” may threaten the Audit Service Provider's independence in relation to the public entity audited on behalf of the Auditor-General.

Footnote 3: If there is any uncertainty, refer the matter to the OAG for a ruling (independence@oag.parliament.nz).