Audit Results Report on Universities and
TAFE Colleges and other audits completed
since 11 November 2005
Report No 2 -
April 2006
This Report includes:
- results of the controls, fi nancial statement
and performance indicator audits of four universities, three of their
subsidiaries and ten TAFE colleges for the year ended 31 December 2005
- significant operational and management issues raised with universities
and TAFE colleges during the conduct of the audits including compliance
with the 2005 revised reporting provisions of the Financial Administration
and Audit Act 1985 (FAAA) and Australian Equivalents to International
Financial Reporting Standards (AIFRS)
- commentary on ongoing information
system control weaknesses and other compliance and control issues.
Audit Results – Universities
and TAFE Colleges
All universities, three of their subsidiaries and
the ten TAFE colleges have made the transition to reporting on the
AIFRS basis and received clear opinions.
This provides reasonable assurance
that effective fi nancial management procedures and practices are operating.
All substantive issues identifi ed during the audits were satisfactorily
resolved or were not signifi cant enough to warrant a qualifi ed opinion.
Management Issues
Timeliness and Quality
Universities and TAFE colleges
improved the timeliness of submission of their fi nancial statements
and performance indicators for audit in order to comply with the revised
FAAA reporting requirements.
Model AIFRS financial statements and
accompanying notes were provided in 2005 by the Commonwealth Department
of Education, Science and Training for universities and the Department
of Education and Training for TAFE colleges. These assisted universities
and TAFE colleges with the form and presentation of their fi nancial
statements. However, improved communication and coordination between
agencies and Audit is needed to expedite the conduct of future audits.
In particular, better specifi ed client assistance schedules from Audit
and appropriate agency quality assurance processes are proposed to enhance
the quality of fi nancial statements, performance indicators and associated
working papers next year.
Information System Control Weaknesses
Whilst
some improvement in information system controls was evident during 2005,
moderate to signifi cant weaknesses in computer security and business
continuity planning still exist at the universities and TAFE colleges.
Universities and TAFE colleges should ensure that their security and
business continuity arrangements represent good practice and are appropriately
refl ective of operational risk.
Lack of progress on previously reported
issue – Authorisation of
fee for service training programs
The Department of Education and Training
has not made progress to authorise the fee for service training programs
delivered by TAFE colleges as previously recommended (Report 3, May
2005).
Other Audit Work With
31 December 2005 reporting date
Results
are reported for:
- three half yearly reviews of interim financial
statements for the period ended 31 December 2005
- two audit opinions
on six monthly financial statements for the period ended 31 December
2005
- two
audit opinions for agencies with calendar year reporting requirements.
Finalising other 2005 audits
Audit opinions for 175 agencies with
reporting periods ending on 30 June or 31 July 2005 were reported
to Parliament in November 2005 (Report 12, 2005). Clear audit opinions
on the remaining 10 agencies are included in this report along
with a summary of the eight independent audit reports on fi nancial
and statistical information completed in compliance with conditions
of Commonwealth funding, specifi c grants or legislation.
Apart from
the audits of the Professional Standards Council and seven subsidiaries
of universities, this fi nalises my reporting on agencies with
a 2005 reporting date.
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