Review 3 final 2 - TAU - National Treasury

TECHNICAL ASSISTANCE UNIT REVIEW | Performance Power and Governance
“Performance
Power and
Governance”:
Audit of
Predetermined
Performance
Objectives (AOPO)
The TAU Review reflects, in many of its articles, on the
notion of power and governance. This article provides
concrete examples of how governments are able to
work with Constitutional democratic institutions and
frameworks to manage government’s power wisely
and to ensure good governance.
“
has effected a name change from Audit
From AoPI to AOPO
The Auditor-General of South Africa (AGSA)
of Performance Information to Audit of
Predetermined Performance Objectives.
The terminology change is a matter of
emphases, and seeks to foreground:
• the target/objective-driven approach;
and
• the linkage and tracking of programmes
”
and projects to strategic and operational
objectives.
What is the audit of performance
objectives
Over the past several decades, supreme audit institutions
around the world have moved from only carrying
out financial audits to a complementary “line of business”
namely that of providing assurance on performance
objectives and information produced by governments
for tabling in Legislatures and Parliaments.
This type of audit is significant in countries, such as
South Africa, which is undergoing public sector reform
in line with Constitutional and democratic imperatives.
The process includes significant initiatives to improve
transparency, accountability and public sector
reporting. This includes providing legislatures and the
public with better information on what government
programmes are substantively accomplishing.
The result of an audit of performance objectives is to
enable the auditor to conclude whether the reported
performance against predetermined objectives is useful
and reliable, in all material respects, based on predetermined
criteria. In South Africa the audit of performance
objectives is done in terms of the requirements
of the Public Audit Act (PAA), Act no. 25 of 2004.
The audit of performance objectives forms an integral
part of the annual regularity audit process, confirming
the credibility of the reported performance objectives,
against the Strategic Plan, in the Annual Reports of
government entities, and should not be confused with
performance auditing. Performance auditing can be
defined as an independent audit of the management
measures instituted by government institutions to ensure
the economical procurement and efficient and effective
utilisation of resources.
Why is it necessary
With the implementation of the Public Finance
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Enabling change for development