Speakers: Dr Caralee McLiesh, Speaker 1, Unknown Speaker

Transcript

Speaker 1

we were changing minister at this point. Uh, but apparently my paperwork's incorrect. So, we are remaining with Minister Wong and we are welcoming Dr. Caroli Mcclesich >> um from the Auditor General uh for the Australia National Audit Office and other offices. >> Minister, do you have a statement to make? No. Dr. Fle, do you have a statement that you would like to make?

Dr Caralee McLiesh

>> Thank you. Thank you. And good evening, chair and committee members. Yeah. >> First on behalf of the ANAO, I wanted to express our our sadness um on the deeply distressing events of last week in relation to Dr. Helen Haines and our thoughts and best wishes are with her and her family at this time. 2026 marks 125 years since the com the first Commonwealth Parliament passed the Audit Act of 1901. While much has changed since federation, the ANO's purpose remains constant to provide independent assurance to the parliament and contribute to better outcomes for the Australian public. Our 202526 annual report tabled on the 22nd of September 26 sets out how we fulfilled this enduring purpose through independent highquality reporting on the financial and non-financial performance of Australian government entities. During the year, we delivered 243 audit opinions for annual financial statements of Commonwealth entities and companies, audit opinions for 21 annual performance statements of material Commonwealth entities, 39 performance audits, one priority assurance review, the 2425 major projects report, and one other report on the Australian National University's financial management, and a range of other assurance activities, reports, and services to support transparency, accountability, and performance in the Australian government sector. sector. Our audits have reinforced the importance of disciplined governance, effective controls, and clear accountability in supporting sound public administration and in delivering value for money. 96% of ANAO performance audit recommendations were agreed to by audit by by audited entities and based on entity self-reporting, more than 90% of recommendations have been implemented within 24 months of reports being presented, contributing to improved performance. Our work continues to be shaped by broader trends affecting the Australian public sector. Geopolitical developments, fiscal pressures, the rapid emergence of new technologies including artificial intelligence and heightened cyber security and uh cyber security risks are among the factors influencing government activity and risk and therefore the ANAO in its work as the government's independent auditor. We met five of our nine performance measures last year. External pressures including rising costs and delays in activity by audited entities contributed to the targets not met. We will continue to focus on aspects of our performance that are within the ANO's control. Beyond delivering our mandated functions in 2526, we made progress against our strategic priorities related to impact, innovation, and our people. In the first year of implementing our strategic program, we tried new approaches to audits, including rapid reviews and report at a glance plain English summaries. We better calibrated our audit effort to risk, launched our digital strategy and AI policy, and increased use of data analytics and AI tools. We're also increasing our focus on internal staff mobility and career development, streamline streamlining aspects of our governance, and we introduced additional staff engagement activities. Our work is underpinned by an enduring focus on quality and integrity. At a time when serious ethical breaches in the private audit profession have occurred, we have worked to strengthen the quality and integrity asurances we seek from our contractors, as well as continually improve our internal equality and integrity systems. These foundations are essential to maintaining the independence of the office and the trust that's placed in our work by the parliament and the Australian public. The AO reported an operating deficit of.768 million, just under a million dollars in 2526, reduced from a $6.5 million operating deficit in the previous year. Achieving this improvement required a range of actions to increase efficiency as well as a reduction in our work program, including lowering the target number of performance audits from the long-standing historical target of 48 to a range of 38 to 42 in this past year. Financial sustainability remains an ongoing priority. In its 2026-27 budget day statement, the joint committee of public accounts and audit observed that funding of the ANAO continues to be of serious concern to the committee as it threatens the robustness of the vital audit function that this agency conducts for the Commonwealth. A benchmarking exercise of the Australasian Councils of Auditors General found that Australia's auditor general independence arrangements fell from a ranking of fifth in 2009 to ninth in 2025 out of 12 rankings. Low scores on financial and managerial autonomy were key factors contributing to this result. I'd like to conclude by acknowledging my ANO team. Our people are the foundation of all that we achieved in 2526. Audit is demanding work and this year we asked a great deal of our auditing staff and those who support them. I'm proud of the ANAO team and grateful for the professionalism, engagement and deep commitment to our purpose that they've shown throughout the year. Thank you and we look forward to answering your