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Performance audit     Print

A fair and impartial assessment that provides objective information about the performance of programs, activities and functions, and when applicable, specifics about where improvements can be made and the likely impact of those improvements, of a governmental or non-profit entity to assess whether the entity is achieving economy, efficiency and effectiveness in the employment of available resource.

Purpose

The commonly recognised purpose of performance auditing is to add value by finding ways to improve operations and results. One approach is doing this is to assess the impact attributable to a program or other intervention and prepare a cost and benefit analysis if the impact is positive. The more common approach is to identify performance problems and their effect and then identify the causes for corrective action.

Audit classes

There are two basic classes of auditing:;

  • where auditors verify information provided by someone else, i.e. verification auditing; and
  • where auditors develop information.  Information development is what performance audit has been about.

The most common performance audits is about auditing economy, efficiency and effectiveness. 

New information

Auditors got into the business of developing information largely because traditional sources of information could not fully meet the requirements of managers, elected officials or others wanting information on government stewardship. They develop and report informaiton on all aspects of performance, both financial and non financial.

Objectives

Performance audits have 3 objectives:

  • Economy - the acquisition of appropriate quality and quantity of financial, human, and material resources at the appropriate times and at the lowest cost;  The INTOSAI definition is the audit of admnistrative activities in accordance with sound administrative principles and practices and management policies.
  • Efficiency - the use of financial, human and physical resources such that the output is maximised for a given set of resources inputs, or input is minimised for a given quantity and quality of output provided;
  • Effectiveness - the achievement of objectives or other intended effects of programs, projects, operations or activities. INTOSAI also includes the audit of the actual impact of activities compared with the intended impact.

  Translation
Dutch Prestatie-audit
French Audit de la performance


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