Introduction by the Controller and Auditor-General

• Introduction by the Controller and Auditor-General
• Background to this Strategic Plan
• Overview
• Current state – Future state
• What will be different for our stakeholders in five years
  

Introduction by the Controller and Auditor-General

Having an independent Office, which continues to be relevant, and one which, through its work, engenders real change and improvement in the public sector, are my key goals for my term as Auditor-General.

I’m proud to present the Strategic Plan for the balance of my term as Auditor-General – that is, the five years to June 2009.

Underpinning this strategy is the belief that we can make more of a difference to our stakeholders – to Parliament (including local constituencies), to public entities and to our staff. We’ve set out an ambitious vision for the next five years – we’d like to be acknowledged as leaders in designing and delivering independent assurance services.

There is, currently, a very wide range of issues in our operating environment with audit implications – including significant changes in legislation. In devising our strategy, we’ve had regard to these issues and to what our stakeholders have been telling us about how they’d like us to respond.

The key to us being successful will be the continual re-shaping of our services and using the best people. Already, the change in the way we choose auditors who do the annual audits has freed up our ability to better share our knowledge and our people.

I believe our strategy positions the Office for the future.

Kevin Brady
Controller and Auditor-General
30 January 2004

Background to this Strategic Plan

This Strategic Plan is for the next five years (from 1 July 2004 to 30 June 2009), being the balance of the current Auditor-General’s term. It should be read in conjunction with the Annual Plan for 2004-05 (particularly in relation to planned performance audits). The Annual Plan is also available on our web site at www.oag.govt.nz.

The Strategic Plan is presented in four parts:

• Introduction: which provides the reader with a summary of our key findings, and paints a picture of how we see the future for the Office and for our stakeholders – Parliament (including local constituencies), public entities and our staff.
• Purpose and outcomes: which explains why the Office exists, what it does and what outcomes it desires to achieve.
• Strategic context: which sets out the key issues in our environment and the needs of our stakeholders, and discusses the Office’s current ability to respond to these.
• Strategic responses: which outlines our strategy and vision, identifies the strategic areas we need to focus on over the next five years and details our responses and actions. It also highlights the key risks facing the Office and how we intend to mitigate them, and outlines how we will measure the success of this strategy.

Overview

Purpose and Outcomes

Why the Office exists, what it does, and what situation it desires to create… (pages 9–11)

• OUR PURPOSE
  • Constitutional safeguard to maintain the financial integrity of New Zealand’s parliamentary system of government.
  • Providers of independent assurance to Parliament and the public over the operations of public sector organisations and their use of public resources and the powers conferred on them.
• DESIRED SITUATION
  • Where Parliament and the public know whether public entities (including central and local government entities, and others such as schools) are -
    • carrying out their activities effectively, efficiently, and appropriately;
    • using public funds wisely; and
    • reporting their performance accurately -

    and know that, if this is not the case, we will tell them. In addition, entities should do this with a focus on continual improvement and innovation.

Strategic Context

The key issues in our environment, our stakeholders’ needs and our current ability to respond… (pages 13-20)

• KEY ISSUES IN OUR ENVIRONMENT

  Significant and ongoing changes in:

  • The accounting and auditing profession.
  • Public entities’ legislative and operating environments.
  • Information and reporting requirements and methods.

• KEY STAKEHOLDER NEEDS

  Stakeholders would like more:

  • Performance audits.
  • Help navigating through information and understanding and applying legislative changes.
  • Best practice information.

  We could do better by:

  • Improved timeliness, especially for inquiries and performance audits.
  • Greater responsiveness, and innovation.

• OUR CURRENT ABILITY TO RESPOND
  • + Our independence.
  • + Strong knowledge and expertise of our people.
  • + Depth and breadth of relationships.
  • + Robust standards.
  • - Light mix of performance audits to financial audits.
  • - Lean capability in performance audits.
  • - Timeliness variable.
  • - Inadequately funded for inquiries.
  • - Depleted capability in product development and research.

Strategic Responses

Our strategy and vision, and our strategic areas of focus… (pages 22 - 37)

• OUR FIVE-YEAR STRATEGY
  • "Product Leadership"
• OUR VISION
  • To set the benchmark for design and delivery of independent assurance services by:
    • shaping our services to anticipate and respond to Parliament and other stakeholders’ needs and our changing environment;
    • building our capability to create and deliver our services;
    • fostering relationships and ways of working to support our strategy of product leadership; and
    • acting independently in everything we do.
• STRATEGIC AREAS OF FOCUS
  • Ongoing research and development, and product development, and innovation.
  • Changes to the breadth and depth of our current assurance products and services.
  • Enhancement of our Strategic Audit Planning process and deployment of our full range of assurance interventions around issues/risks.
  • Continual adaptation of our organisation.

Current state - Future state

Where we are now	Where we want to be
[Description of pie chart]	[Description of pie chart]
OUR PRODUCTS/SERVICES
Current services mix: Low performance audit:financial audit ratio Inquiries inadequately funded/resourced Limited non-financial and waste, probity, governance and accountability flavours in annual audits Backlog of product development Depleted research capability Un-integrated assurance responses	Future services mix: Double the number of performance audits Inquiries acknowledged as core and funded/resourced appropriately Annual audits with stronger non-financial and waste, probity and accountability flavours Short lag time between legislative/other changes and product development Established research capability Strategic deployment of our full range of assurance services around issues/risks
OUR PEOPLE
Technically strong Constantly calling on the same people for inquiries and product development – and expecting them to still do their substantive jobs	Professional leadership Flexible access to the best people Ability to backfill roles Headspace to think
THE WAY WE DO THINGS
Business units acting as separate organisations Competitive behaviours No formal accountabilities for our strategy	“Whole-of-Office” thinking Joint working – internally and externally Innovation encouraged and rewarded
HOW
Governance & accountability for our strategy Infrastructure Knowledge Management strategy and systems Project managing our work Supportive business processes Innovation measures Increased access to capability/capacity Working together (internally and externally) Ongoing development of technical competence of our staff and Audit Service Providers Leading-edge audit methodologies

What will be different for our stakeholders in five years