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COMMITTEE'S CONSIDERATION

In its Report No. 44, 57th Parliament – Examination of Auditor-General Reports, tabled on 21 April 2023, the committee reported on its consideration of a number of Auditor-General's reports referred to it, including Auditor-General Report 11: 2022-23 - State Entities 2022.  The committee did not resolve to hold further inquiries into these audit reports and made no recommendations to the Legislative Assembly.

Overview

Role of the Auditor-General 

The role of the Auditor-General is to provide Parliament with independent assurance of public sector accountability and performance. This is achieved through reporting to Parliament on the results of its financial and performance audits and other insights.

About the Auditor-General Report

The report summarises the audit results of 253 Queensland state government entities, including the 20 core government departments. It also analyses the consolidated financial performance of the Queensland Government (referred to as the ‘total state sector') for 2021–22.

The QAO found the financial statements of all departments, government owned corporations, most statutory bodies, and the entities they control are reliable and comply with relevant laws and standards. However, the QAO again raised concerns that ongoing delays in the tabling of annual reports means the financial statements of departments and statutory bodies are dated and less relevant by the time they are released to the public.

The report states that in 2021–22, the total state sector reported a net operating surplus of $1.3 billion, compared with a deficit of $3.2 billion in 2020-21. The improved financial performance of the state was due to market conditions that resulted in significant increases in revenue of $13.8 billion (19 per cent), including from royalty revenue, stamp duty and payroll tax. The report also noted demand for public services is growing, particularly in the areas of health, education, child protection, and domestic and family violence, with an associated increase in the cost to deliver these services. Overall, total state sector expenses increased by $9.2 billion (12.2 per cent) in 2021–22. The report also found the state reported an increase of $54.1 billion (27 per cent) in its net assets in 2021–22 largely driven by spending on new assets (like roads) and increases in the value of existing assets (like land). Investments also increased, with some of the higher-than-expected royalty revenues being invested in long-term assets.

The QAO also found that the internal controls (people, systems, and processes) entities have in place are generally effective, but the same common weaknesses continue. The QAO advised some of these require immediate action by management. According to the report, over a quarter of deficiencies raised with departments in 2020–21 were not resolved in accordance with agreed time frames. As a result, the QAO recommended that audit committees of public sector entities actively monitor the implementation of audit recommendations and encourage the timely resolution of outstanding internal control weaknesses.

Referral to Committee 

Standing Order 194B provides that the Committee of the Legislative Assembly shall as soon as practicable after a report of the Auditor-General is tabled in the Assembly refer that report to the relevant portfolio committee(s) for consideration.  

The committee is responsible under section 94 of the Parliament of Queensland Act 2001 for assessing the integrity, economy, efficiency and effectiveness of government financial management by examining government financial documents and considering reports of the Auditor-General.

The Committee of the Legislative Assembly referred this Auditor-General’s report to the committee on 16 March 2023.