Interim audits of government departments and agencies have found an overall improvement in financial controls and a reduction in the number of significant and moderate risk.

The results of the interim phase of the 2009-10 financial statement audits of all portfolio departments and other major general government sector (GGS) agencies were tabled in Parliament on Thursday by Auditor-General Ian McPhee.

The annual report investigates whether the financial statements of agenices were prepared in accordance with the Finance Minister Orders. The interim audit includes a review of governance arrangements related to agencies’ financial reporting responsibilities and an analysis of relevant internal controls.

In his report, Mr McPhee said agencies were continuing to meet their financial legislative compliance responsibilities, but there were a number of control weaknesses.

“The results of the interim phase of our 2009–10 financial statement audits reflect a continuation of the reduction over recent years in the number of significant and moderate risk audit findings,” Mr McPhee said.

“This reflects the general stability and maturity of the control regimes in the majority of agencies and actions taken by agencies to address prior year audit findings.

“Our audits do, however, continue to identify control weaknesses in a number of areas particularly relating to agencies’ IT control environments, business continuity management and the management of assets.”

Mr McPhee said the report would act as a catalyst for improvements within government agencies and departments.

Download the report: Interim Phase of the Audit of Financial Statements of Major General Government Sector Agencies for the year ending 30 June 2010 [PDF]

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