The Auditor-General is an officer of Parliament. The role and functions of an auditor-general have been in place in New Zealand since the 1840s. The current role and functions are set out in the Public Audit Act 2001.

The Auditor-General is appointed by the Governor-General on the recommendation of Parliament for a non-renewable seven-year term. The current Auditor-General is Lyn Provost. The Auditor-General is sometimes referred to as a "public watchdog". The Auditor-General acts as a check and balance on how public money is spent. In carrying out her statutory functions, the Auditor-General is wholly independent, although she is accountable to Parliament for his use of public funds.

The Auditor-General is the statutory auditor of all public entities, about 4000 in total. These include all government departments, Crown entities (including schools and universities), State-owned enterprises and their subsidiaries, a range of statutory bodies, and all local authorities and their subsidiaries. The Auditor-General appoints auditors for these entities, and is responsible for the performance of those auditors.

As auditor of all public entities, the Auditor-General has five main concerns:

• Performance: Have public entities carried out activities in keeping with Parliament's intentions in an effective and efficient manner?
• Authority: Have public entities carried out activities, and observed accountability requirements, within the authority granted by Parliament?
• Waste: Have public entities obtained and applied resources in an economical manner? Are taxpayers' dollars being wasted?
• Probity: Are public entities meeting Parliament's and the public's expectations of an appropriate standard of behaviour?
• Accountability: Have entities given full and accurate accounts of their activities? Are governance and management arrangements able to address any concerns?

The Auditor-General employs staff and contracts private sector accounting firms. The Auditor-General’s employees are organised into two business units: the Office of the Auditor-General (the OAG) and Audit New Zealand. Here is a basic structure showing how work is allocated:

The Auditor-General may use different types of audit approach. We explain these approaches in detail later in this booklet. They include:

• annual audits of the financial statements that public entities are required to have audited - these include financial and service performance information;
• about 15 targeted performance audits each year - these are significant audits of aspects of public entities’ operations;
• inquiries into any matter concerning a public entity’s use of its resources - these can be minor or major; and
• assurance engagements - this is work of an audit nature that may be carried out by, or on behalf of, the Auditor-General for public entities, in addition to annual audit assurance.