It's time to improve NSW's accounts: A-G

Written By Unknown on Selasa, 26 Februari 2013 | 15.02

NSW Auditor-General Peter Achterstraat says he'll back any move to lift the dismal quality of the state's accounting, including sending senior financial bureaucrats to boot camp.

"I have been making the point since 2009 that we really do have to tighten up these figures," Mr Achterstraat said after releasing yet another damning audit.

A total of 1265 errors were made by government agencies in financial reports for the year ending June 2012, including 164 mistakes by the department of premier and cabinet and 359 errors by health.

This represents an increase of nine errors from the same period last year.

"There are just too many errors in them and 2012 was no different from 2011," Mr Achterstraat said.

"There are lots of different errors and the net result is quite a large number - there are a number (of mistakes worth) over $100 million."

The mistakes this financial year added up to about $1 billion, he added.

"Some of it is just basic maths, some of it is just spreadsheets, wrong formulas, but others are the evaluations of assets."

Mr Achterstraat said people were using a market value "when there may not be a market".

"Or they might be using discounted cashflow when there might not be any income coming in on a particular building," he said.

"There are accounting standards which say it needs to be done this way or that way, and they have to be followed."

The most common asset-related mistakes concerned the evaluation of buildings and other large infrastructure.

Other mistakes featuring smaller amounts of money involved spreadsheets and accruals.

However, Mr Achterstraat conceded some of it "was quite complicated" so people needed "a fair bit of training".

In response to the audit, NSW Treasurer Mike Baird has announced new financial reporting and accountability measures, which were endorsed by cabinet on Monday night.

"It's clear that we have a long way to go to turn around the problems in reporting and forecasting that have been systemic in NSW for a decade," Mr Baird said in a statement on Tuesday.

The changes include greater accountability for financial reporting via enhanced performance agreements for public-sector CEOs and CFOs.

The government also has the option of appointing an investigative accountant to an agency should there be poor ongoing financial management.

"I think any steps which are going to increase capabilities of the people preparing the reports and increase the quality of the finances are most welcome," Mr Achterstraat told ABC Radio.

Late last year, Mr Achterstraat identified 37 major errors in financial statements for the 2011/12 budget, changing the bottom line by $1 billion.


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