interpreting and prioritising financial and audit information

1. interpreting and prioritising financial and audit information Ian Carruthers Director, Policy and Technical, CIPFA

2. Overview • How can PACs deal with and prioritise an increasing volume of audit output? • How can PACs best examine accounts and other information of a financial nature presented by departments to Parliament?

3. Dealing with increasing volumes of audit output • Focus on matters of importance: • Material expenditure / revenues • Known fraud and other risks • Current government initiatives or Change programmes • Review work on an exception basis • Lever the work of others (particularly the SAI) • Plan work rather than waiting for it to happen

4. Types of audit reporting • Financial audit v Performance audit • Other types (forensic, environmental, IT) • Single entity focus v cross-cutting thematic studies • Critical review v best/good practice • General PFM v specific policy effectiveness

5. Examining accounts and other financial information • Quality of the accounts and supporting information – advocacy role: • National and international standards (IPSASs) • Limitations of cash-based reporting • Alignment of estimates / budgets / accounts • Narrative / performance reporting • Develop financial expertise on the PAC • Lever the work of others (the SAI, other parliamentary advisers, and other sources)

6. What information is included?

7. Using the accounts • What do the accounts tell us? • What do the audit findings tell us? • How are the accounts being used to inform decision making?

8. Summary • Plan the work – focus on areas of importance • Decide on the balance of types of audit reporting • Press for improvements in accounts quality • Develop financial expertise on the PAC • Understand what information is included in the accounts and other reports • Ensure information is used for decision making