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Audit Amendment Bill 2017
Introduction Print
EXPLANATORY MEMORANDUM
General
The purpose of the Bill is to re-enact with amendments certain provisions
of the Audit Act 1994 and to extend and modernise the duties, powers
and functions of the Auditor-General and the Victorian Auditor-General's
Office, to clarify the rights and obligations of entities audited by the
Auditor General, to consequentially amend certain other Acts and for
other purposes.
Clause Notes
Part 1--Preliminary
Part 1 of the Bill outlines the purposes of the Bill and contains the
commencement provisions.
Clause 1 provides that the main purposes of this Bill are to re-enact with
amendments certain provisions of the Audit Act 1994 to--
• further facilitate the transparency of the expenditure of
public funds and performance of public functions and
the accountability of government to Parliament; and
• strengthen and clarify the duties, powers and
functions of the Auditor-General and the Victorian
Auditor-General's Office (VAGO); and
• clarify the rights and obligations of entities audited
by the Auditor-General; and
• improve the operational efficiency and effectiveness
of the Auditor-General and VAGO; and
• make consequential amendments to other Acts.
581423 1 BILL LA INTRODUCTION 12/12/2017
Clause 2 sets out the commencement of the Bill. It will come
into operation on a day or days to be proclaimed or
on 1 January 2019 if not proclaimed before that date.
Clause 3 provides that in the Bill the Audit Act 1994 is called the
Principal Act.
Part 2--Principal Act amended
Part 2 of the Bill amends the purposes of the Principal Act, amends existing
definitions and inserts new definitions, amends the objectives of the Principal
Act, and substitutes Parts 2, 3, 3A, 3B, 4, 4A, 5, and 6 of the Principal Act
with new Parts 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12 and 13.
Clause 4 amends section 1 of the Principal Act, so that the purposes of
the Act include--
• the conduct of efficient and effective financial audits
in the Victorian public sector; and
• the conduct of efficient and effective performance
audits in the Victorian public sector, including the
examination of specified uses of a financial benefit
or property for a particular purpose; and
• the conduct of efficient and effective assurance reviews
in the Victorian public sector, including the examination
of specified uses of a financial benefit or property for a
particular purpose; and
• the provision of reports on audits and assurance reviews
by the Auditor-General to the Parliament; and
• the administration and audit of VAGO.
Clause 5 amends section 3 of the Principal Act by amending existing
definitions, repealing existing definitions and inserting new
definitions.
Subclause (1) repeals the definitions of authority, compulsory
appearance, domestic partner, entity, presiding officer, spouse
and voluntary appearance. The definition of authority is to be
replaced by the new definition of public body. The definition
of entity under the Interpretation of Legislation Act 1984 will
apply to the use of this term in the Principal Act. The definitions
of compulsory appearance, domestic partner, presiding officer,
spouse and voluntary appearance are no longer used.
2
Subclause (1) amends the definitions of associated entity,
legal practitioner, performance audit, VAGO officer,
VAGO premises, and Victorian Inspectorate Officer.
Subclause (1) substitutes a new definition of public body to
mean the following, but does not include an exempt entity--
• a public sector body within the meaning of section 4(1)
of the Public Administration Act 2004;
• a corporate body, or an unincorporated body,
established for a public purpose by or under an Act,
the Governor in Council or a Minister, including a
university within the meaning of section 1.1.3 of the
Education and Training Reform Act 2006;
• an entity of which the State or another public body has
sole or joint control;
• a Council within the meaning of the Local Government
Act 1989;
• a State owned enterprise within the meaning of the
State Owned Enterprises Act 1992;
• a trust body within the meaning of the Financial
Management Act 1994;
• a trustee of a trust in which the State is the principal
beneficiary;
• a trustee of a trust in which a Council is the principal
beneficiary or several Councils are the principal
beneficiaries;
• a regional library under section 196 of the Local
Government Act 1989;
• a registered community health centre within the
meaning of the Health Services Act 1988;
• a body that provides aged care services that is
registered under the Health Services Act 1988;
• any other entity prescribed for the purposes of this
definition.
The new definition of public body replaces the current
definitions of authority and public body in the Principal Act.
3
Subclause (2) inserts the following new definitions into the
Principal Act--
additional auditing and assurance standards means standards
made or formulated by a body performing comparable functions
to the Auditing and Assurance Standards Board, as in force from
time to time;
assurance review has the same meaning as a limited assurance
review within the meaning of the auditing and assurance
standards;
auditing and assurance standards means the standards made by
the Auditing and Assurance Standards Board under section 336
of the Corporations Act or formulated by the Board under
section 227B of the ASIC Act, as in force from time to time;
Auditing and Assurance Standards Board means the Auditing
and Assurance Standards Board established under section 227A
of the ASIC Act;
authorised person means any of the following who are
authorised by the Auditor-General under section 29--
• a Deputy Auditor-General;
• a person acting in the office of Deputy Auditor-General;
• a senior VAGO officer;
Department Head has the same meaning as in section 3(1) of the
Public Administration Act 2004;
draft specification means--
• in relation to a performance audit conducted
under new section 14 or 15, a specification prepared
for the purpose of consultation under new section 17;
and
• in relation to a performance audit of the
Auditor-General or VAGO under new section 82,
a specification prepared for the purpose of consultation
with the Auditor-General under new section 82(7);
entry notice means a notice served under new section 44;
4
exempt entity means--
• a department of the Parliament; or
• a court; or
• any other prescribed entity;
final specification means--
• in relation to a performance audit conducted under
new section 14 or 15, a specification finalised under
section 17(3); and
• in relation to a performance audit of the
Auditor-General or VAGO under section 82, a
specification finalised under section 82(8);
independent performance auditor means a person appointed
under new section 82 to audit the Auditor-General and VAGO;
information gathering notice means a notice served under new
section 30;
public purpose audit arrangement means an arrangement
entered into by the Auditor-General with an entity that is not
a public body under new section 24;
senior VAGO officer means a person who holds a prescribed
position or is a member of a class of prescribed positions.
Subclause (3) repeals the definition of domestic partner in
section 3(2) of the Principal Act as this term is not used in
the Act.
Subclause (4) inserts a note at the foot of new section 3 of
the Principal Act outlining the applicability of the Electronic
Transactions (Victoria) Act 2000 to the Principal Act.
Clause 6 amends the objectives of the Principal Act to substitute new
objectives.
Subclause (1) substitutes "public bodies" for "authorities" in
section 3A(1)(a) of the Principal Act consistent with the new
defined term.
5
Subclause (2) substitutes sections 3A(1)(b), (c) and (ca) of the
Principal Act for the following objectives--
• to determine whether--
• public bodies are achieving their objectives
effectively, economically and efficiently and
in compliance with all relevant Acts;
• Victorian public sector operations and activities
are being performed effectively, economically
and efficiently and in compliance with all
relevant Acts;
• financial benefits or property given by a public
body to an associated entity or other entity,
or property otherwise of an associated entity,
are being used effectively, economically and
efficiently for the particular purpose that
financial benefit or property is given or
otherwise used;
• to determine whether there has been any wastage of
public resources or any lack of probity or financial
prudence in the management or application of public
resources in the Victorian public sector;
• to ensure the Auditor-General has the necessary powers
when conducting an audit or assurance review.
Subclause (3) updates the language in section 3A(1)(d) of the
Principal Act to substitute "his or her performance" for the
words "performance as the Auditor-General".
Clause 7 amends section 3B of the Principal Act to replace the reference
to existing Part 3 and section 16C to new Parts 3, 4, 5, 6, 7 and 9
which contain the re-enacted and new provisions.
Clause 8 inserts new section 3C into the Principal Act, which provides
for the Act to bind the Crown.
Clause 9 sets out the substantial amendments to the Principal Act, and
substitutes Parts 2, 3, 3A, 3B, 4, 4A, 5, and 6 of the Principal
Act for new Parts and sections.
6
Part 2 provides for the appointment of an Acting Auditor-General
and the administration of VAGO.
Division 1 sets out the requirements for the appointment and
remuneration of the Acting Auditor-General, and for a person
acting as the deputy of the Auditor-General.
New section 4, which substantially re-enacts section 6 of the
Principal Act and modernises its language, sets out the process
for appointing an Acting Auditor-General, and modernises the
language of section 6 of the Principal Act.
New section 5, which substantially re-enacts section 7 of the
Principal Act, sets out the requirements for a person to act as the
deputy of the Auditor-General and inserts a new subsection (5),
which provides that while a person is acting as Deputy Auditor-
General, the person is entitled to remuneration at the same rate as
the Deputy-Auditor-General.
Division 2 sets out authorisations for employment of staff by
VAGO, engagement of persons or firms by the Auditor-General,
and delegation of the Auditor-General's functions and certain
powers by instrument.
New section 6, which re-enacts section 7E of the Principal
Act, authorises the employment of employees under Part 3
of the Public Administration Act 2004 as required for the
performance of functions of VAGO.
New section 7, which substantially re-enacts section 7F of the
Principal Act with updated section references, authorises the
Auditor-General to engage a person or firm to assist in the
performance of the Auditor-General's functions, except for a
person appointed to conduct--
• an independent financial audit of VAGO under new
section 79;
• a person appointed as the independent performance
auditor of the Auditor-General and VAGO under
new section 82.
7
New section 8, which substantially re-enacts section 7G of the
Principal Act, authorises delegation of the Auditor-General's
functions and certain powers by instrument.
• new section 8(4) updates the definition of threshold
amount at section 7G(3) of the Principal Act to
replace "2002" and "2003", with "2016" and "2017"
respectively in new section 8(4)(a);
• to replace "5 000 000" with "10 000 000" in new
section 8(4)(a) and (b); and
• to replace "2003" with "2017" in new section 8(4)(b).
New section 9, which re-enacts section 7H of the Principal Act,
requires the State to indemnify the Auditor-General, a Deputy
Auditor-General, a person acting in the office of Auditor-General
or Deputy Auditor-General, and a person employed under new
section 6, against liability for anything done or omitted to be
done in good faith in the exercise of a power or performance of
a function or duty, or in the reasonable belief that the act or
omission was in the exercise of a power or performance of a
function or duty under the Principal Act or any other Act.
New Part 3 sets out the requirements for conducting financial
audits.
New section 10 provides for the audit of the financial statements
and report of operations of public bodies. It substantially
re-enacts section 8 of the Principal Act, with minor technical
amendments to enhance accessibility and updated references to
new definitions.
New section 11 requires the Auditor-General to express a written
audit opinion on a public body's financial statements after it is
audited under new section 10(1). It re-enacts section 9 of the
Principal Act, makes minor technical amendments to enhance
the readability of the section, and updates references to new
definitions and sections.
New section 12, which re-enacts section 9A of the Principal Act,
requires the Auditor-General to express a written audit opinion
on each annual financial report of the State to the Minister who
prepared the annual financial report.
8
New section 13, which re-enacts section 10 of the Principal
Act and updates its section references, requires a public body
or relevant Minister to pay to the Consolidated Fund an amount
determined by the Auditor-General to defray the reasonable costs
and expenses incurred in conducting an audit and expressing an
audit opinion. New section 13(4) clarifies that if a public body
or relevant Minister disputes the reasonableness of the amount
to be paid, the dispute is to be referred to arbitration under the
Commercial Arbitration Act 2011.
New Part 4 consolidates and clarifies the requirements for
preparing specifications and conducting consultation on
performance audits by the Auditor-General.
New section 14(1) authorises the Auditor-General to conduct
any performance audit the Auditor-General considers necessary
to determine whether--
• a public body is achieving its objectives effectively,
economically and efficiently and in compliance with
all relevant Acts; or
• the operations or activities of the whole or any part
of the Victorian public sector, whether or not they are
performed by a public body, are performed effectively,
economically and efficiently and in compliance with all
relevant Acts.
New section 14(2) expressly prohibits the Auditor-General from
conducting a performance audit of the Victorian Inspectorate,
and excludes the Victorian Inspectorate from the operation of
new section 14.
New section 14(3) states that a performance audit is limited to
considering the objectives and particular issues specified in the
final specification or, if there is one, the amended specification.
New section 15, which substantially re-enacts section 15(2),
section 15(3) and section 16C of the Principal Act, authorises the
Auditor-General to conduct any performance audit considered
necessary to determine whether a financial benefit or property
provided by a public body to an associated entity or other entity
that is not a public body, has been used effectively, economically
and efficiently for the particular purpose for which it was given.
9
New section 15(2) specifies the kinds of financial benefit or
property that are subject to new subsection 15(1), and provides
an example of a financial benefit or property that is not given
on commercial terms.
New section 15(3) provides that a performance audit under
this section is limited to considering the objectives and
particular issues specified in the final specification, or the
amended specification if there is one.
New sections 16 and 17, clarify the steps the Auditor-General
must take before conducting a performance audit.
New section 16 requires the Auditor-General to first prepare
a specification for any performance audit before calling for
any information or exercising any powers under new Part 7.
The objectives of the performance audit, the entities to be
included in the audit, and the particular issues to be considered
must be detailed in the specification.
New section 16(3) specifies that new section 16(1) does not
prevent a VAGO officer from requesting information, and does
not prevent a person providing information by consent at any
time.
New section 17(1) outlines with whom the Auditor-General
must consult before finalising the specification for a performance
audit. New section 17(1) requires the Auditor-General to consult
with--
• any public body that appears in the draft specification;
• the Parliamentary Committee if--
• the performance audit does not appear in the
Auditor-General's annual plan prepared under
new section 73;
• the performance audit appears in the
Auditor-General's annual plan and is subject
to a material change to the objectives of the
audit, the entities included in the audit or the
particular issues (if any) to be considered;
• the performance audit is conducted under new
section 15 and includes an associated entity or
an entity that is not a public body;
10
• the performance audit involves collaboration or
information sharing with the Auditor-General of
another jurisdiction under new section 69; or
• it requests that it be consulted;
• any associated entity or other entity that is included in
the draft specification if the draft specification is for a
performance audit conducted under new section 15.
New section 17(2) authorises the Auditor-General to consult with
an associated entity or any other entity on a draft specification for
a performance audit conducted under new section 15.
New section 17(3), which substantially re-enacts section 15(6)
of the Principal Act with updated terms, specifies that if the
Parliamentary Committee, public body, associated entity or
other entity does not respond to a request for comment on a
draft specification for a performance audit within 15 days of
receiving the request from the Auditor-General, they are to be
taken to have no comment on the draft specification, and the
Auditor-General may finalise the specification.
New section 18(1) requires the Auditor-General to provide a
final specification for a performance audit to any public body,
associated entity or other entity that is included in the
performance audit.
New section 18(2) authorises the Auditor-General to
amend a final specification for a performance audit if the
Auditor-General is satisfied that the amendment is necessary
to achieve the purpose of the performance audit.
New section 18(3) requires the Auditor-General to amend a
final specification if there is a material change to the objectives
of the audit, the entities included in the audit, or the particular
issues (if any) to be considered.
If the Auditor-General amends a final specification
for a performance audit, new section 18(4) requires the
Auditor-General to do the following before calling for
any further information or exercising further powers
under new Part 7--
• provide a copy of the amended specification to
any public body, associated entity or other entity
included in the amended specification;
11
• consult with any public body, associated entity or other
entity that is included in the amended specification if
there is a material change to any of the following--
• the objectives of the audit;
• the entities included in the audit; or
• the particular issues (if any) to be considered.
New section 18(5) gives the Auditor-General a discretion to
consult with any associated entity or other entity on the amended
specification.
New section 18(6) specifies that if the public body, associated
entity or other entity does not provide comments on an amended
specification within 15 days of receiving the request from the
Auditor-General, they are to be taken to have no comment on the
amended specification, and the Auditor-General may continue to
call for information or exercise any powers under new Part 7 in
relation to the performance audit.
New section 18(7) specifies that new section 18(4) does not
prevent a VAGO officer from requesting information, and does
not prevent a person providing information by consent at any
time.
New Part 5 provides for a new discretion for the Auditor-General
to conduct assurance reviews. This discretion is not intended to
detract from the Auditor-General's existing financial and
performance audit functions and obligations, but will enable the
Auditor-General to conduct reviews on targeted, smaller scale,
time sensitive or lower risk matters.
New section 19 inserts a requirement for the Auditor-General to
conduct an assurance review of each set of estimated financial
statements.
New section 20 provides the Auditor-General with a power
to conduct an assurance review of a particular aspect of any
of the following, if the Auditor-General considers it necessary
to achieve the objectives of the Audit Act--
• the operations or activities of a public body;
12
• the operations or activities of the whole or any part
of the Victorian public sector (whether or not those
operations or activities are being performed by a
public body);
• subject to new section 21, the use of a financial benefit
or property that is specified in new section 21(2) for a
particular purpose.
The Auditor-General may conduct an assurance review with
respect to financial statements or performance of the whole
or any part of the operations or activities included in new
section 20(1). However, the Auditor-General is prohibited
from conducting an assurance review of the Victorian
Inspectorate (other than a review of estimated financial
statements).
New section 21 outlines the additional scope of assurance
reviews in relation to the use of a financial benefit or property.
The Auditor-General may conduct any assurance review the
Auditor-General considers necessary to determine whether a
financial benefit or property has been used effectively,
economically and efficiently for the particular purpose for
which it was given. The kinds of financial benefit or property
under this section are specified as follows--
• a financial benefit given to an associated entity by a
public body for a particular purpose;
• a financial benefit given to an entity (that is not a public
body) by a public body for a particular purpose and the
financial benefit is not given on commercial terms;
• property given to an associated entity by a public body
for a particular purpose;
• property given to an entity (that is not a public body) by
a public body for a particular purpose and the property
is not given on commercial terms;
• property of an associated entity and where a public body
provides a financial benefit for a particular purpose in
relation to that property;
• property of an associated entity in which a public body
holds a security interest for a particular purpose.
13
This section also provides an example of a financial benefit or
property not given on commercial terms to clarify the scope of
the Auditor-General's discretion.
New Part 6 consolidates the Auditor-General's other audit
functions.
New section 22, which re-enacts section 16D of the Principal
Act and updates references to sections, authorises the Auditor-
General to accept appointment under the Corporations Act 2001
of the Commonwealth as auditor of a State company.
New section 23, which substantially re-enacts section 16E
and incorporates new terms and modernises the language of
the section, authorises the Auditor-General to enter into an
arrangement with a public body for the provision of other
auditing services by the Auditor-General to the public body.
New section 24 substantially re-enacts sections 16G(1), 16G(2)
and 16G(3) of the Principal Act in respect of other financial
audits, and makes amendments to--
• update the section with new definitions and
section references; and
• substitute the words "person or body" for the term
"entity".
New section 24(1) authorises the Auditor-General to enter into a
public purpose audit arrangement at the request of an entity that
is not a public body.
Before entering into a public purpose audit arrangement, new
section 24(2) requires the Auditor-General to be satisfied that the
entity exists for a public purpose, and that it is practicable and in
the public interest for the Auditor-General to audit the financial
statements of the entity.
New section 25 substantially re-enacts section 16G(4)(a) of
the Principal Act, and sets out the Auditor-General's obligations
to audit the financial statements of the entity with which
the Auditor-General has entered into a public purpose audit
arrangement, and express a written audit opinion on the entity's
financial statements.
14
New section 26, which re-enacts section 16G(4)(m) of the
Principal Act, authorises the Auditor-General to make a report
to Parliament on any financial audit conducted under a public
purpose audit arrangement. Where the Auditor-General does
make a report to the Parliament under new section 26(1), the
Auditor-General must include in the report the reasons for
opinions expressed in the report and may include any
information the Auditor-General considers necessary, and may
include any recommendations the Auditor-General considers
relevant.
New section 27(1), which re-enacts sections 16G(4)(m) of the
Principal Act, prohibits the Auditor-General from including
the following in a report on a financial audit conducted under a
public purpose audit arrangement--
• information that discloses a trade secret;
• information of a business, commercial or financial
nature which, if disclosed, would be likely to
unreasonably expose a public body, associated entity
or other entity to any material disadvantage;
• any information the Auditor-General considers
would prejudice any criminal proceeding or criminal
investigation, or any investigations by the IBAC or
the Victorian Inspectorate;
• a finding or an opinion that a specified person is guilty
of or has committed, is committing or is about to
commit an offence;
• a recommendation that a specified person be, or an
opinion that a specified person should be, prosecuted
for an offence.
New section 27(2) requires the entity with whom the Auditor-
General has entered into a public purpose audit arrangement to
provide a person who is an officer or employee of that entity
with a reasonable opportunity to respond to a comment or
opinion adverse to that person who is to be named in a report,
which the Auditor-General intends to include in a report.
New section 28, which re-enacts section 16G(4)(c) to (j),
specifies that the information gathering powers in Divisions 1
and 2 of new Part 7 are applicable to a financial audit conducted
under a public purpose audit arrangement.
15
New Part 7 sets out the information gathering powers and duties
that are applicable in the performance of certain functions and
powers under the Principal Act and other Acts.
New Division 1 provides for the power to require information,
documents and attendances.
New section 29 empowers the Auditor-General to appoint, in
writing, an authorised person to exercise any powers under new
Part 7.
New section 30 sets out the Auditor-General's power to call for
information, documents and attendances. If it is relevant to the
performance of functions or powers under this Act or any other
Act, the Auditor-General or an authorised person may serve an
information gathering notice to require a person to do any of the
following--
• provide to the Auditor-General or authorised person
any relevant information specified in the notice before
a specified time and in a specified manner;
• produce to the Auditor-General or authorised person
any relevant document or other thing in the person's
possession, custody or control, before a specified time
and in a specified manner;
• attend and give evidence or answer any relevant
questions before the Auditor-General or authorised
person at a specified time and place.
New section 31 sets out the content and form requirements for
information gathering notices. An information gathering notice
must--
• be in writing;
• be in the prescribed form (if any); and
• include a statement that it is an information gathering
notice under new section 30 of this Act, a statement
that it is an offence not to comply with the information
gathering notice without reasonable excuse, and any
other prescribed matter.
16
New section 32 sets out the service requirements for an
information gathering notice, and provides exceptions in
special circumstances. New section 32(1) requires an
information gathering notice to be served at a reasonable time
(not less than 5 business days) before the date on which the
person is required to attend or otherwise comply with the
notice, unless--
• the Auditor-General or authorised person considers on
reasonable grounds that delay is likely to prejudice the
conduct (but not the timing) of the audit or assurance
review to which the notice relates; or
• the person to whom the notice is addressed consents to
provide the information, or to produce the document or
thing, or to attend to give evidence or answer questions,
at an earlier time.
New section 32(2) requires that an information gathering notice
directed to a natural person must be served personally or at the
person's usual place of work. If the information gathering notice
is directed to a body corporate, new section 32(2) requires the
notice must be served by leaving it with an employee who
appears to be at least 18 years of age--
• at the registered office; or
• at the principal place of business.
New section 33(1) permits the Auditor-General or an authorised
person to administer an oath or affirmation to a person.
New section 33(2) provides that, in relation to a person to whom
an information gathering notice is directed, the Auditor-General
or an authorised person may--
• require the person to either take an oath or make an
affirmation; and
• administer an oath or affirmation to the person; and
• examine the person in accordance with the notice; and
• require the person to produce documents or other things
in accordance with the notice.
17
New section 33(3) and (4), which substantially re-enact
section 11(1A) and (1B) of the Principal Act and make technical
amendments to improve accessibility, and update section
references, require inclusion of information in an information
gathering notice about the nature of the matters about which a
person is to be examined. Such information does not need
to be included in the information gathering notice if the
Auditor-General or authorised person forms the opinion on
reasonable grounds that its inclusion would be likely to prejudice
the conduct of the audit or assurance review to which the notice
relates, or would be contrary to the public interest.
New section 34 enables a person to have legal representation
and provides for the protection of legal practitioners and
witnesses. New section 34(1) enables a person to be represented
by a legal practitioner in relation to an attendance before the
Auditor-General or an authorised person in accordance with an
information gathering notice.
New section 34(2) provides that a legal practitioner representing
a person attending before the Auditor-General or an authorised
person, or assisting the Auditor-General or an authorised person
at an attendance, has the same protection and immunity as a legal
practitioner has in representing a party in a proceeding in the
Supreme Court.
New subsection (3) provides that a person attending before the
Auditor-General or an authorised person in accordance with
an information gathering notice has the same protection and
immunity as a witness has in a proceeding in the Supreme Court.
New section 35 sets out the requirements relating to information
gathering notices on persons under the age of 16 years of age.
New section 35(1) provides that the notice has no effect if it is
served on a person under the age of 16 years at the date the notice
is served.
New section 35(2) requires the Auditor-General or authorised
person to confirm the age of the person who is required to attend
by an information gathering notice, if the Auditor-General or
authorised person considers that the person may be under the age
of 18 years. If the person is under the age of 16 years, the person
must be released from an attendance.
18
Under new section 35(3), if, at any time before or during an
attendance to answer questions or give evidence or produce
documents or other things, the Auditor-General or authorised
person becomes aware that the person attending is under the
age of 16 years, the Auditor-General or authorised person must
immediately release the person from attendance.
New section 35(4) makes clear that subsections (2) and (3)
also apply to a person who provides information or produces
documents or other things, or attends to answer questions or
give evidence, by consent.
New section 36(1) provides that if, during an attendance, it
becomes apparent that the person required to attend to answer
questions or give evidence, does not have knowledge of the
English language that is sufficient to enable the person to
understand questions asked or to answer those questions, the
Auditor-General or authorised person must provide for a
competent interpreter to be present during the attendance.
New section 36(2) requires a person under the age of 18 years
(but 16 years of age or over) to be accompanied by a parent
or guardian or an independent person known to the person
attending, if they are required to attend in relation to an
information gathering notice.
New section 36(3) provides that a person required to attend by
an information gathering notice must be accompanied by an
independent person if--
• the Auditor-General or authorised person believes that
the person attending has a mental impairment; or
• the person attending provides the Auditor-General or
authorised person with reasonably satisfactory medical
evidence that the person has a mental impairment.
New section 36(4) makes clear that new section 36 applies to
a person providing information, documents or other things, or
attending to answer questions or give evidence, by consent.
New section 37, which substantially re-enacts section 11F of
the Principal Act, outlines the requirements to be met for audio
or video recording of attendances. Under this new section, the
Auditor-General or an authorised person must ensure that an
attendance by a person required to attend by an information
gathering notice is audio or video recorded.
19
New section 37(2) provides that evidence of anything said during
an attendance by a person required to attend is inadmissible as
evidence against any person in any proceeding before a court or
tribunal unless--
• the attendance was audio or video recorded; and
• the audio or video recording is available to be tendered
in evidence.
However, this is subject to new section 37(3), which enables a
court or tribunal to admit evidence of anything said during the
attendance by the person required to attend that is otherwise
inadmissible because of subsection (2) if it is satisfied that
there are exceptional circumstances that justify admitting that
evidence.
New section 37(4) provides that the Auditor-General or
authorised person must provide the person who is required
to attend with a copy of the audio or video recording and any
transcript created, unless the Auditor-General or an authorised
person considers on reasonable grounds that doing so may
prejudice an audit or assurance review. If the Auditor-General
or an authorised person determines not to provide a copy of the
audio or video recording and any transcript created under new
section 37(4), new section 37(5) requires the Auditor-General
or authorised person to allow the person to listen to or view the
recording of the person's evidence at VAGO premises at any
reasonable time.
New section 37(6) requires that, as soon as possible after an
attendance, the Auditor-General or authorised person must
provide the Victorian Inspectorate with a copy of the audio
or video recording and any transcript of the attendance.
New section 38 makes clear that the Auditor-General or a
VAGO officer is not required to pay any fees when exercising
information gathering powers under Part 7.
New section 39 requires the Auditor-General to give a written
report to the Victorian Inspectorate within 3 business days after
a person is served with an information gathering notice.
The written report must specify--
• the name of the person to whom the notice was served;
and
20
• the reasons for serving the notice; and
• the purpose of the audit or assurance review.
New section 40 clarifies and sets out the scope of the
Auditor-General's ability to override secrecy and confidentiality
obligations.
New section 40(2) provides for a person who is requested to
provide information, a document or a thing to provide that
despite any prohibition or duty of confidentiality under an
enactment, rule of law or contract.
New section 40(3) limits the effect of subsection (2) where the
document or information is subject to Cabinet confidentiality.
New section 40(4) provides that it is not a reasonable excuse
for a person to refuse or fail to comply with an information
gathering notice on the grounds that another enactment, rule of
law or contract--
• prohibits the person from giving the information or
producing the document or other thing; or
• imposes a duty of confidentiality on the person in
relation to the information, document or other thing.
New section 40(5) provides that it is a reasonable excuse to
refuse or fail to comply with an information gathering notice if it
relates to a document or information which is subject to Cabinet
confidentiality unless the notice is served for certain specified
purposes; being--
• a financial audit under Part 3;
• a performance audit under Part 4;
• an assurance review under Part 5;
• performing the Auditor-General's functions or
powers under another Act where the other Act
expressly authorises the provision of the information.
New section 40(6) provides that a person is not subject to any
civil, administrative or disciplinary proceeding or action only
because the person complied with a request for information, a
document or thing by the Auditor-General, an authorised person
or a VAGO officer assisting the Auditor-General for the purposes
21
of anything done under this Act, or with an information gathering
notice.
New Division 2 sets out the requirements relating to the use
of documents and things produced to the Auditor-General or
a VAGO officer.
New section 41(1) provides that, in respect of any document or
thing produced in response to an information gathering notice
or provided by consent, the Auditor-General or a VAGO officer
may--
• inspect any document or other thing;
• retain the document or other thing for as long as is
reasonably necessary for the purpose for which it
was produced or provided; and
• take extracts from and make copies of the document or
other thing.
New section 41(2) enables a person who is entitled to inspect
a document or other thing that is in the possession of the
Auditor-General or a VAGO officer to inspect the document
or other thing at any reasonable time.
New section 42 sets out requirements relating to the return or
destruction of documents by the Auditor-General or a VAGO
officer.
New section 42(1) specifies that if the retention of a document or
other thing ceases to be reasonably necessary for the purpose for
which it was produced or provided, the Auditor-General or a
VAGO officer must cause the document or other thing to be--
• delivered to the person who appears to be entitled to that
document or other thing; or
• destroyed; or
• in the case of an electronic document, deleted.
Under new section 42(2), if a document referred to in new
section 42(1) is subject to Cabinet confidentiality, the
Auditor-General or a VAGO officer must cause the document
to be delivered to the Secretary to the Department of Premier
and Cabinet at the completion of the audit or assurance review
for which the document was produced or provided.
22
New section 42(3) clarifies that a document provided in
electronic form may be delivered to the person who appears
to be entitled to that document by electronic communication.
New section 42(4) authorises the Auditor-General to retain a
copy of a document used in an audit or assurance review, despite
new section 42(1), for any applicable period required by the
auditing and assurance standards or by the Principal Act or any
other law.
New section 42(5) requires the Secretary to the Department
of Premier and Cabinet to provide the Auditor-General or a
VAGO officer with access to a document that was delivered
to the Secretary under new section 42(2), if such access is
necessary for the Auditor-General to comply with the auditing
and assurance standards.
Division 3 outlines the Auditor-General or an authorised person's
powers to enter and inspect premises owned or occupied by a
public body or an associated entity.
New section 43(1) provides that, in accordance with this
Division, the Auditor-General or an authorised person, at all
reasonable times, may enter and remain on premises owned
or occupied by a public body to inspect the premises and any
document or other thing on the premises, if the Auditor-General
or an authorised person considers on reasonable grounds that--
• it is necessary for the purposes of a financial audit
or performance audit under this Act; and
• the information and any other things cannot be
obtained by consent or by serving an information
gathering notice.
New section 43(2) provides that, in accordance with this
Division, the Auditor-General or an authorised person, at all
reasonable times, may enter and remain on premises owned
or occupied by an associated entity to inspect the premises
and any document or other thing on the premises if--
• entry and inspection of the premises is for the
purposes of a performance audit of a public
body under new section 15; and
23
• the premises--
• are used solely or predominately for the purposes
of providing services to, or performing functions
for, or on behalf of, a public body or the State; or
• contain property of a public body or the State, or
property in which a public body or the State has
a security interest.
New section 44 provides that, unless consent has been given,
the Auditor-General or an authorised person must serve the
owner or occupier of the premises with a written notice before
entering the premises of a public body or an associated entity
under section 43. The written notice must--
• be in the prescribed form (if any); and
• include--
• a statement that it is an entry notice under
section 44 of this Act; and
• a statement that it is an offence not to comply
with the entry notice without reasonable excuse;
and
• any other prescribed matter.
New section 45 provides the service requirements for an entry
notice. New section 45(1) requires an entry notice to be served
at a reasonable time, being not less than 5 business days, before
the date specified in the entry notice for the Auditor-General or
authorised person to enter the premises of the pubic body or
associated entity, unless--
• the Auditor-General or authorised person considers on
reasonable grounds that delay is likely to prejudice the
conduct (but not the timing) of the audit to which the
notice relates; or
• the person to whom the notice is addressed consents to
the Auditor-General or authorised person entering the
premises at an earlier time.
New section 45(2) requires an entry notice directed to a natural
person to be served personally or at the person's usual place of
work.
24
New section 45(3) requires an entry notice directed to a body
corporate to be served by leaving it with an employee who is
apparently at least 18 years of age--
• at the premises that the Auditor-General or authorised
person wants to enter; or
• at the registered office or principal place of business.
New section 46(1) requires the Auditor-General or an authorised
person to produce proof of identity when requested by the owner
or occupier of the premises of a public body or an associated
entity, while exercising a power under this Division.
New section 46(2) specifies that if the Auditor-General or an
authorised person fails to produce proof of identity on request,
the Auditor-General or authorised person--
• is not entitled to enter the premises; and
• if the Auditor-General or authorised person is already
on the premises, the Auditor-General or authorised
person must immediately cease exercising powers of
inspection and leave the premises.
New section 47 requires a person who is served with an
entry notice to provide all reasonable assistance necessary
to each of the following who attends for the purposes of the
Auditor-General or authorised person exercising the power
to enter and inspect the premises of a public body or an
associated entity--
• the Auditor-General;
• an authorised person;
• a VAGO officer.
New section 48 provides that, if the Auditor-General, an
authorised person or a VAGO officer enters the premises of
a public body or an associated entity and requests to copy any
document, or remove any document or thing, otherwise than in
accordance with an information gathering notice, the owner or
occupier of the premises may request that the Auditor-General
or authorised person serve an information gathering notice.
25
New section 49 provides for the protection of privacy and
minimisation of disruption. Under this new section, irrespective
of whether entry is obtained by notice or by consent, the
Auditor-General, authorised person or VAGO officer must take
reasonable steps to--
• protect the privacy of any person temporarily or
permanently residing at the premises; and
• minimise disruption to the operations of the public body
or associated entity that owns or occupies the premises
and to any other occupiers.
New section 50 sets out obligations in respect of vulnerable
persons. The Auditor-General must develop protocols for
interacting with vulnerable persons on the premises of a
public body or an associated entity entered and inspected by
the Auditor-General, an authorised person or a VAGO officer.
The Auditor-General, authorised person or VAGO officer must
comply with those protocols irrespective of whether entry to the
premises is obtained by notice or by consent.
New section 50(3) also defines vulnerable persons as including
children, the elderly, and persons with a cognitive impairment or
a disability.
New section 51 requires that, within three business days after a
person is served with an entry notice, the Auditor-General must
give a written report to the Victorian Inspectorate specifying--
• the name of the person to whom the notice was served;
and
• the reasons for serving the notice; and
• the purpose of the audit.
New Division 4 sets out a number of offences and penalties.
New section 52 provides that a person who is duly served with
an information gathering notice must not, without reasonable
excuse, refuse or fail to comply with the notice. This section
makes clear that a person cannot rely on statutory secrecy and
confidentiality provisions as a reasonable excuse. The maximum
penalty for this offence is 240 penalty units or imprisonment for
2 years.
26
Section 53 provides that a person who is duly served with an
entry notice must not, without reasonable excuse, refuse or fail to
comply with the notice. The maximum penalty for this offence is
240 penalty units or imprisonment for 2 years.
New section 54 provides for two offences.
Under new section 54(1) a person who is duly served with
an information gathering notice must not, without reasonable
excuse, refuse or fail to take an oath or make an affirmation
when required to do so. The maximum penalty for this offence
is 240 penalty units or imprisonment for 2 years.
Under new section 54(2) a person who is duly served with
an information gathering notice must not, without reasonable
excuse, refuse or fail to answer a question that the person is
required to answer by the Auditor-General or an authorised
person. The maximum penalty for this offence is 240 penalty
units or imprisonment for 2 years.
However, under new section 54(3) if the Auditor-General or
authorised person fails to inform the person that refusal or
failure to take the oath or make the affirmation or answer the
question without reasonable excuse is an offence, the person will
not have committed an offence under new section 54(1) or 54(2).
New section 55(1) provides that a person must not make a
statement to the Auditor-General or an authorised person
that the person knows to be false or misleading in a material
particular. The maximum penalty for this offence is
120 penalty units or imprisonment for 12 months. The note
to new section 55(1) makes clear that section 314 of the
Crimes Act 1958 in relation to perjury and section 254 of that
Act in relation to the destruction of evidence may be relevant.
New section 55(2) provides that a person must not produce a
document or other thing to the Auditor-General or an authorised
person that the person knows to be false or misleading in a
material particular unless the person--
• indicates to the Auditor-General or authorised person
the respect in which it is false or misleading; and
• to the extent practicable, provides the correct
information.
27
The maximum penalty for this offence is 120 penalty units or
imprisonment for 12 months.
New Part 8 provides for reporting on audits.
New section 56 provides that the Auditor-General may
make a report to Parliament on audits and assurance reviews.
This section provides the Auditor-General with the discretion
to make a report to Parliament on any audit or assurance review
by or on behalf of the Auditor-General under the Principal Act.
This report must set out the reasons for opinions expressed in the
report, and may include any information and recommendation the
Auditor-General considers relevant.
New section 57 provides for the reporting on the annual financial
report of the State. The Auditor-General must make a report to
the Parliament on each annual financial report.
Under new section 57(2), the report may include any information
and recommendations that the Auditor-General considers
necessary for more effective and efficient management of public
resources, and for the keeping of proper accounts and records of
transactions relating to public resources.
Under new section 57(3), after preparing a proposed report, the
Auditor-General must give a copy of the report to the Minister
who prepared the annual financial report, and ask the Minister
in writing to provide comment before a specified date at least
10 business days after the proposed report is given to the
Minister.
Under new section 57(4), the Auditor-General must include in
the report to the Parliament any comments, or a summary of the
comments, made by the Minister before the date specified, in a
form agreed between the Auditor-General and the Minister.
New section 58 provides for consultation on reports prepared
under new section 56.
Under new section 58(2), the Auditor-General must provide a
copy of the proposed report, or part of it, to the entities specified
in the section, and may give a copy of the report or part of the
proposed report to any entity the Auditor-General considers to
have a special interest in that report. The Auditor-General must
request, in writing, that any entity that has been provided with a
copy of the report, or part of the report, provide comments within
10 business days if the report is in relation to a performance
28
audit, and within 5 business days if the report is in relation to
any other audit or assurance review.
Under new section 58(3), the Auditor-General is not required
to make a written request for comments where a copy of the
proposed report, or part of the proposed report has been provided
to the Department Head of the Department of Premier and
Cabinet, unless the report relates to an audit or assurance review
of the Department of Premier and Cabinet, a prescribed body, or
the whole of the Victorian public sector.
Under new section 58(4), the Auditor-General must include
in a report any comments, or a summary of comments made
within the specified timeframe, in a form agreed between the
Auditor-General and the entity that provided the comments.
New section 59 provides for the transmission of reports under
new section 56 of any audit or assurance review to Parliament.
It substantially re-enacts section 16AB of the Principal Act, and
amends it by substituting new section references.
New section 60 provides that the Auditor-General must
report to the Parliamentary Committee on assurance reviews.
The Auditor-General is required to submit a report on any
assurance review that the Auditor-General has conducted within
the specified periods, and the Auditor-General must also include
the reasons for the assurance review and identify any public
body, associated entity or other body included in the assurance
review, in the report. This section requires the Auditor-General
to submit the report to the Parliamentary Committee no later than
4 weeks after the final day of the relevant period, which is
defined to mean--
• the period between the day that this new section comes
into operation and the final day of the quarterly cycle
of the financial year that day falls within; or
• each quarterly cycle of every financial year following
the period as above.
Division 2 provides for the content of reports.
New section 61 provides for reports relating to associated entities
and other entities that are not public bodies. New section 61(1)
restricts the application of the section to reports by the Auditor-
General of performance audits conducted under new section 15,
or assurance reviews conducted under new section 21.
29
New section 61(2) prohibits the Auditor-General from including
in the report any recommendation directed to the associated
entity or an entity that is not a public body, or any statement or
finding about the associated entity or entity that is not a public
body that is not directly related to the matters to be determined
by the audit or assurance review.
New section 61(3) requires the Auditor-General to include in the
report the reasons for including any associated entity or entity
that is not a public body in the performance audit or assurance
review.
New section 62 provides that the Auditor-General must not
include information that discloses a trade secret or is
commercially sensitive in any report prepared under the
Principal Act or any other Act. This new section does not
prevent that information from being disclosed pursuant to new
section 64, that is, if it is relevant to the subject matter of a report,
and it is in the public interest to include the information in the
report.
New section 63 re-enacts sections 16(5), 16(6) and 16C(5)
of the Principal Act, and prohibits the Auditor-General from
questioning the merits of policy objectives of the Government in
any report it prepares under the Principal Act or any other Act.
New section 64, subject to new sections 62, 63 and 65, allows
the Auditor-General to include any information that has been
acquired through the performance of duties and functions of
the Auditor-General in any report. This is limited to if the
Auditor-General considers the information to be relevant to the
subject matter of the report and it is in the public interest to
include the information.
New section 65 specifies additional information that the
Auditor-General is prohibited from including in a report.
The Auditor-General must not include in a report under the
Principal Act or any other Act--
• any information that the Auditor-General considers
would prejudice any criminal proceedings, criminal
investigations or investigations by the IBAC or the
Victorian Inspectorate; or
30
• a finding or opinion that a specified person is guilty of
or has committed, is committing or is about to commit
an offence; or
• a recommendation that a specified person be, or opinion
that a specified person should be, prosecuted for an
offence.
New section 65(2) specifies that if the Auditor-General intends
to include any adverse comment or opinion about a person who
is to be named in the report and who is an officer or employee
of a public body, associated entity or other entity, the public
body, associated entity or other entity must give that person a
reasonable opportunity to respond to the public body, associated
entity or other entity in relation to the adverse material.
New Part 9 provides for the notification of suspected corrupt
conduct to the IBAC and the Victorian Inspectorate, and
information sharing.
New section 66, which re-enacts section 19A of the Principal
Act, requires the Auditor General to notify the IBAC of any
matter the Auditor-General suspects on reasonable grounds
involves corrupt conduct, subject to any exemption issued under
the Independent Broad-based Anti-corruption Commission
Act 2011.
New section 67, which re-enacts section 19B of the Principal
Act, requires the Auditor-General to notify the Victorian
Inspectorate of misconduct in relation to specified officers and
entities.
New section 68 sets out the circumstances in which the
Auditor-General may provide or disclose information to a
specified entity.
New section 68(1) enables the Auditor-General to provide
information acquired in the performance of the duties and
functions or exercise of powers under the Principal Act or
any other Act to a specified entity, if the Auditor-General
considers that--
• the information is provided or disclosed for the
purpose of enabling the specified entity to perform
duties and functions, or exercise powers under any
Act; and
31
• having regard to the nature of the information, it is
appropriate for the information to be provided or
disclosed to the specified entity.
New section 68(2) defines specified entities for the purposes
of new section 68(1).
New section 68(3) provides that the Auditor-General is not
permitted to provide or disclose information to specified
entities that is contained in an exempt document within the
meaning of section 28 of the Freedom of Information
Act 1982, or that is subject to any restriction on its disclosure
under any Act, including a Commonwealth Act.
New section 69, which substantially re-enacts section 16FA of
the Principal Act, provides the circumstances under which the
Auditor-General may collaborate and share information with an
Auditor-General of another jurisdiction.
New section 69(3) provides that the Auditor-General may
provide or disclose information to the Auditor-General of
another jurisdiction if the Auditor-General considers that it
is in the public interest to provide or disclose the information.
New section 69(5) permits the Auditor-General to share
information provided under new section 69(3) that has not
already been published on the condition that it is not disclosed
or published by the Auditor-General to whom it is provided,
unless disclosure or publication is required for the performance
of the duties and functions of that Auditor-General.
New section 69(6), which substantially re-enacts section
16FA(5) of the Principal Act, requires the Auditor-General to
report on the sharing of information under new section 69 in a
report of an audit or assurance review, or in the next annual
report if the information is shared after the relevant report of an
audit or assurance review has been prepared, or the information
was not acquired in the conduct of an audit or assurance review.
New section 69(7) defines another jurisdiction for the purposes
of new section 69 to mean the Commonwealth, another State or a
Territory.
32
New section 70, which re-enacts section 20B of the Principal
Act, provides for the exemption of certain documents from the
operation of the Freedom of Information Act 1982, and makes
a consequential amendment so that the new section also extends
to documents related to assurance reviews.
New section 70(2) defines agency to mean the Auditor-General
or VAGO.
New section 71 creates an offence for the improper use or
unauthorised disclosure or provision of information. The offence
applies only to a person who is, or was a VAGO officer, a
person appointed as the independent auditor of VAGO, or a
person appointed as the independent performance auditor of the
Auditor-General and VAGO. Under this new section, a person is
prohibited from making improper use of, or directly or indirectly
providing or disclosing any information acquired by the person
in the performance of the duties and functions, or exercise of
powers under the Principal Act or any other Act. The maximum
penalty for this offence is 120 penalty units or imprisonment for
12 months.
Under new section 71(3), a person may provide or disclose
information without committing an offence in the following
circumstances--
• for the performance of duties and functions, or the
exercise of powers of the person in accordance with
the Principal Act or any other Act;
• if the information is in the public domain at the time,
otherwise than as a result of a disclosure that the
person knows or ought to have known was unlawful;
• for the purposes of a proceeding for an offence against
the Principal Act or any other Act; or
• as is otherwise authorised or required by the Principal
Act or any other Act.
New section 72 prohibits a person who receives or obtains
confidential information from VAGO, a VAGO officer or
otherwise under the Principal Act from providing or
disclosing that information. The maximum penalty for this
offence is 120 penalty units or imprisonment for 12 months.
33
Under new section 72(2) a person may provide or disclose
confidential information without committing an offence in the
following circumstances--
• for the purpose of making submissions or comments to
the Auditor-General on a proposed report;
• for the purpose of obtaining legal or financial advice;
• if the information is in the public domain at the time,
otherwise than as a result of a disclosure that the
person knows or ought to have known was unlawful;
• if the person is an officer or employee of a public body
or an Auditor-General of another jurisdiction and the
provision or disclosure is required to perform the
person's official duties;
• if the person is a Department Head and the provision
or disclosure is required to perform the person's official
duties; or
• if the Auditor-General or a VAGO officer consents
to the confidential information being provided or
disclosed.
New section 72(3) defines confidential information as--
• a proposed report or part of a proposed report;
• a draft report or part of a draft report;
• working documents prepared for an audit or assurance
review;
• information provided or disclosed as permitted under
new sections 68 and 69; or
• any other information provided or disclosed under the
Audit Act which is stated to be confidential, or by its
nature is confidential.
New Part 10 provides for the accountability of the
Auditor-General.
Division 1 sets out the reporting requirements of the
Auditor-General.
34
New section 73, which re-enacts sections 7A(1) to (6) of
the Principal Act, provides for the preparation of the
Auditor-General's annual plan.
New section 74, which re-enacts section 7A(7) to (11) of the
Principal Act, provides for the annual plan to be laid before
Parliament.
New section 75, which re-enacts section 7B of the Principal Act,
sets out the requirements for the annual report to be prepared by
the Auditor-General.
Division 2 sets out other obligations of the Auditor-General.
New section 76, which re-enacts section 7C of the Principal Act,
permits the Parliamentary Committee to alter certain obligations
or requirements imposed on the Auditor-General or VAGO, and
sets out the procedural requirements to make such alterations.
New section 77, which re-enacts section 7D of the Principal Act,
sets out requirements with respect to audit priorities, budgets and
expenditure.
New section 78(1) requires the application of auditing and
assurance standards in the performance of functions and the
exercise of powers in relation to audits or assurance reviews
under the Principal Act.
New section 78(2) permits the Auditor-General to apply
additional auditing and assurance standards to the conduct
of audits and assurance reviews under the Principal Act,
not inconsistent with the auditing and assurance standards.
Any additional auditing and assurance standards applied by
the Auditor-General must be summarised in the annual report,
as per new section 75(2)(f).
New Part 11 provides for audits of the Auditor-General and
VAGO.
New section 79 re-enacts with amendments section 17 of
the Principal Act, and enables an independent financial
auditor to audit VAGO. New section 79(1) provides that,
on the recommendation of the Parliamentary Committee, a
suitably qualified person may be appointed by resolution of
the Legislative Council and Legislative Assembly as an
independent financial auditor of VAGO other than--
35
• a person who has a conflict of interest by reason of
being engaged by the Auditor-General under new
section 7;
• a person who has a conflict of interest by reason of
holding a delegation from the Auditor-General under
new section 8;
• a person appointed under new section 82 as
the independent performance auditor of the
Auditor-General and VAGO.
New section 79(2) provides that the independent financial
auditor--
• is appointed for a period not exceeding 4 years; and
• may be re-appointed under this section; and
• is appointed on the terms and conditions and is entitled
to the remuneration determined by the Parliamentary
Committee; and
• in conducting the audit, must comply with directions as
to the audit given by the Parliamentary Committee.
New section 79(3) re-enacts section 17(3) of the Principal Act,
and provides for the remuneration of the independent financial
auditor.
New section 79(4) re-enacts with amendments section 17(4) of
the Principal Act by specifying that the independent financial
auditor must conduct an audit of VAGO's financial statements at
least once in each financial year.
New section 79(5) enables, subject to any directions given by the
Parliamentary Committee, the independent financial auditor to
exercise any powers of the Auditor-General under new Part 7 to
the extent necessary to conduct the independent financial audit.
New section 79(6) authorises the independent financial auditor to
apply additional auditing and assurance standards applied by the
Auditor-General under section 78(2) to the conduct of audits of
financial statements of VAGO.
36
New section 80 provides that, after auditing the financial
statements of VAGO under new section 79(4), the independent
financial auditor must provide a written audit opinion on the
financial statements to the Parliamentary Committee and the
Auditor-General.
New section 81 substantially re-enacts section 18 of the
Principal Act, with amendments to modernise the language of
the section for clarity and substitutes new section references.
New section 81(5) re-enacts with amendments section 18(5)
of the Principal Act to provide that the independent financial
auditor must not include in a report under subsection (1)--
• information that discloses a trade secret; or
• information of a business, commercial or financial
nature which, if disclosed, would be likely to
unreasonably expose the Auditor-General or VAGO
to any material disadvantage; or
• information that the independent financial auditor
considers would prejudice any criminal proceeding
or criminal investigation, or any investigations by the
IBAC or the Victorian Inspectorate; or
• a finding or an opinion that a specified person is
guilty of or has committed, is committing or is about
to commit an offence; or
• a recommendation that a specified person be, or an
opinion that a specified person should be, prosecuted
for an offence.
New section 81(6) provides that if the independent financial
auditor intends to include in a report under subsection (1) a
comment or an opinion that is adverse to any person who is to
be named in the report and who is an officer or employee of
VAGO, the Auditor-General (after receiving a copy of the
proposed report or the relevant part of it) must give the person
a reasonable opportunity to respond to the Auditor-General in
relation to the adverse material.
New section 82 provides for the independent performance audit
of Auditor-General and VAGO.
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New section 82(1) provides that, on the recommendation
of the Parliamentary Committee, a suitably qualified person
may be appointed by resolution of the Legislative Council and
Legislative Assembly as an independent performance auditor
of the Auditor-General and VAGO other than--
• a person who has a conflict of interest by reason of
being engaged by the Auditor-General under new
section 7;
• a person who has a conflict of interest by reason of
holding a delegation from the Auditor-General under
new section 8; or
• a person appointed under new section 79 as the
independent financial auditor of VAGO.
New section 82(2) provides that the independent performance
auditor is to be appointed on the terms and conditions and is
entitled to the remuneration determined by the Parliamentary
Committee, and in conducting the audit, must comply with
directions as to the audit given by the Parliamentary Committee.
New section 82(3) provides that the remuneration payable under
the appointment is to be paid from money appropriated to the
Parliament.
New section 82(4) requires the independent performance auditor
to conduct a performance audit at least once every 4 years to
determine whether the Auditor-General and VAGO are achieving
their objectives effectively, economically and efficiently and in
compliance with all relevant Acts.
New section 82(5) permits, subject to any directions given by the
Parliamentary Committee, the independent performance auditor
to exercise any powers of the Auditor-General under new Part 7
to the extent necessary to conduct the audit as if a reference
in that Part to the Auditor-General includes a reference to the
independent performance auditor.
New section 82(6) requires the Parliamentary Committee to
prepare and finalise a specification for a performance audit
before the independent performance auditor may call for any
information or rely on any power under Part 7 in relation to
the audit.
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Before finalising a specification for a performance audit, new
section 82(7) requires the Parliamentary Committee to--
• prepare a draft specification for the performance
audit that sets out the objectives of the audit and
the particular issues (if any) to be addressed; and
• consult with the Auditor-General on the draft
specification.
Under new section 82(8), if the Auditor-General does not
respond to a request for comment on a draft specification for
a performance audit within 15 business days of receiving the
request--
• the Auditor-General is taken to have no comment on the
draft specification; and
• the independent performance auditor may finalise the
specification.
New section 82(9) requires the Parliamentary Committee to
provide the final specification for a performance audit to the
Auditor-General.
New section 82(10) enables the independent performance auditor
to apply additional auditing and assurance standards applied by
the Auditor-General under new section 78(2) to the conduct of
performance audits of the Auditor-General and VAGO.
New section 83 re-enacts with amendments sections 19(6) to (9)
of the Principal Act, and outlines the requirements of a report
of the independent performance auditor. This section enables
the independent performance auditor to make a report of a
performance audit conducted under section 82. Such a report--
• may include any information and recommendations the
independent performance auditor considers relevant;
and
• must set out the reasons for opinions expressed in the
report.
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New section 83(3) prohibits the independent performance auditor
from making a report under new section 83(1) unless--
• at least 20 business days before making the report,
the independent performance auditor gives the
Auditor-General a copy of the report or a summary
of findings and proposed recommendations; and
• the independent performance auditor requests the
Auditor-General in writing for comment before a
specified date, being at least 10 business days after
the report is given to the Auditor-General; and
• the independent performance auditor includes in the
report any comments made before the specified date,
or a summary of those comments, in a form agreed
between the independent performance auditor and the
Auditor-General.
New section 83(4) requires the independent performance auditor,
within 7 sitting days of making the report, to transmit the report
to each House of the Parliament.
New section 83(5) prohibits the independent performance auditor
from including in the report--
• information that discloses a trade secret; or
• information of a business, commercial or financial
nature which, if disclosed, would be likely to
unreasonably expose the Auditor-General or VAGO
to any material disadvantage; or
• information that the independent performance auditor
considers would prejudice any criminal proceeding or
criminal investigation, or any investigations by the
IBAC or the Victorian Inspectorate; or
• a finding or an opinion that a specified person is
guilty of or has committed, is committing or is about
to commit an offence; or
• a recommendation that a specified person be, or an
opinion that a specified person should be, prosecuted
for an offence.
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New section 83(6) provides that if the independent performance
auditor intends to include in a report under subsection (1) a
comment or an opinion that is adverse to any person who is to
be named in the report and who is an officer or employee of
VAGO, the Auditor-General, after receiving a copy of the
proposed report or the relevant part of the proposed report,
must give the person a reasonable opportunity to respond to
the Auditor-General in relation to the adverse material.
New Part 12 contains a general provision.
New section 84 enables the Governor in Council to make
regulations for or with respect to any matter or thing required
or permitted by the Principal Act to be prescribed or necessary
to be prescribed to give effect to the Principal Act. This section
makes clear the breadth of the regulations under the Principal
Act.
New Part 13 sets out the transitional provisions in relation to the
Principal Act.
New section 85 inserts a transitional provision in relation to
Audit Victoria staff. It provides that, despite its repeal by the
Bill, section 25 of the Principal Act (as in force immediately
before its repeal) continues to apply to any person to whom it
applied on and from 1 January 2000. This is a re-enactment of
an existing transitional provision.
New section 86 inserts a transitional provision in relation to
the Integrity and Accountability Legislation Amendment
Act 2012. It provides that despite its repeal by the Bill,
section 29 of the Principal Act (as in force immediately
before its repeal) continues to apply to any person to whom,
or requirement or other matter to which, it applied immediately
before its repeal. This is a re-enactment of an existing
transitional provision.
New section 87 inserts a transitional provision in relation to
the Deputy Auditor-General. It provides that, despite the
repeal of section 7 of the Principal Act by the Bill, a person
employed as Deputy Auditor-General or a person acting as
Deputy Auditor-General under that section immediately before
its repeal is taken to be employed as Deputy Auditor-General or
acting as Deputy Auditor-General under new section 5 on and
from the commencement of that section.
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New section 88 inserts a transitional provision in relation to the
staff of VAGO. Despite the repeal of section 7E of the Principal
Act by the Bill, any employee employed in accordance with that
section immediately before its repeal is taken to be employed
under new section 6 on and from the commencement of that
section on the same conditions and with the same rights and
entitlements as the person had immediately before the repeal.
New section 89 inserts a transitional provision in relation to State
indemnity. This section provides that on the commencement of
new Part 2, any indemnity by the State under section 7H of the
Principal Act as in force immediately before its repeal is taken to
be an indemnity under new section 9.
New section 90 inserts a transitional provision in relation to
information gathering powers and duties.
New section 90(1) provides that the information gathering
powers and duties in new Part 7, on commencement, only apply
to the exercise of any power or performance of any functions
under the Principal Act or any other Act on and from the
commencement of that Part.
New section 90(2) provides that despite the repeal of sections 11,
11A, 11B, 11C, 11D, 11E, 11F, 11G and 12 of the Principal Act
by the Bill, these sections continue to apply to any review of
estimated financial statements or audit commenced but not
completed before the commencement of new Part 7 as inserted
by the Bill.
New section 91 inserts a transitional provision in relation
to payment of audit fees. This section provides that on the
commencement of new section 13, any amount owing under
section 10 of the Principal Act as in force immediately before
its repeal is taken to be an amount owing under new section 13,
and may be referred to arbitration under new section 13(4).
New section 92 inserts a transitional provision in relation to
other auditing functions of the Auditor-General. This section
provides that despite the repeal of sections 16D, 16E and 16G
of the Principal Act by the Bill, these sections continue to
apply to any audit commenced but not completed before the
commencement of new Part 6 as inserted by the Bill.
42
New section 93 inserts a transitional provision in relation to
reports made by the Auditor-General, the independent financial
auditor and the independent performance auditor.
New section 93(1) provides that on the commencement of new
section 59, any report required under sections 16, 16A, 16AB
and 16B of the Principal Act as in force immediately before their
repeal may be dealt with under section 59 as if it were a report
under new Part 8.
New section 93(2) provides that on the commencement of new
section 81, any report required under section 18 of the Principal
Act as in force immediately before its repeal may be dealt with
under new section 81 as if it were a report under that section.
New section 93(3) provides that on the commencement of new
section 83, any report required under section 19 of the Principal
Act as in force immediately before its repeal may be dealt with
under new section 83 as if it were a report under that section.
Part 3--Consequential amendments to other Acts
Division 1--Victorian Inspectorate Act 2011
Clause 10 amends the definition of coercive power in section 3(1) of the
Victorian Inspectorate Act 2011 to replace "section 11" with
"sections 30 and 43" as a consequence of renumbering arising
from re-enactment of the section.
Clause 11 amends section 11(3)(a)(ii) of the Victorian Inspectorate
Act 2011 to replace former section references to the Principal
Act with new section references.
Clause 12 makes amendments to section 41(1) the Victorian Inspectorate
Act 2011 to update the terminology of that Act and insert
references to an assurance review.
Subclause (1) amends section 41(1) to substitute
"the appearance of a person at a compulsory appearance"
for the words "an attendance by information gathering
notice" to reflect new terminology in the Audit Act.
Subclause (2) amends section 41(1)(a) to substitute
"appeared" for the updated terminology of "attended".
Subclause (3) amends section 41(1)(b) to substitute
"appearance" for the updated terminology of "attendance".
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Subclause (4) amends section 41(1)(c) to substitute for
"appearance" updated terminology of "person's attendance".
Subclause (5) consequentially amends section 41(1)(d)--
• to replace the word "appearance" (where first occurring)
for "attendance";
• to insert after "audit", the words "or assurance review";
and
• to substitute for "appearance occurred" the words
"information gathering notice was served".
Subclause (6) amends section 41(1)(e) to substitute "attendance"
for "appearance".
Clause 13 amends section 43(3)(b) of the Victorian Inspectorate Act 2011
to replace former section references to the Principal Act with new
section references in relation to complaints that can be made to
the Victorian Inspectorate.
Clause 14 amends section 46(2)(b) of the Victorian Inspectorate Act 2011
to replace former section references to the Principal Act with new
section references in relation to the Victorian Inspectorate's own
motion investigation powers.
Clause 15 amends section 47(8)(c) of the Victorian Inspectorate Act 2011
to insert after "audit" (wherever occurring), the words "or
assurance review" in relation to conduct of an investigation by
the Victorian Inspectorate as a consequence of the Principal Act
now including assurance reviews.
Clause 16 amends sections 58(2) and (8) of the Victorian Inspectorate
Act 2011 to insert after "audit" (wherever occurring), the words
"or assurance review" in relation to legal representation of
witnesses and other persons.
Clause 17 amends section 88(3)(e) of the Victorian Inspectorate
Act 2011 to insert after "audit" (wherever occurring), the
words "or assurance review" in relation to advice to a
complainant.
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Clause 18 sets out the amendments to the Victorian Inspectorate Act 2011
in relation to matters to be included in annual report.
Subclause (1) amends section 91(1)(g)(ii) to replace former
section references to the Principal Act with new section
references.
Subclause (2) amends section 91(7) to insert after "audit"
(wherever occurring), the words "or assurance review".
Division 2--Other consequential amendments
Clause 19 amends sections 19(2) and 20(5) of the Health (Commonwealth
State Funding Arrangements) Act 2012 to substitute
"authority" with the words "public body".
Clause 20 amends section 139(3A) of the Health Services Act 1988 to
substitute the reference to "section 12" with "section 40".
Clause 21 amends section 3(1) of the Independent Broad-based
Anti-corruption Commission Act 2011 to substitute--
• in paragraph (b) of the definition of mandatory
notification provision the reference to "section 19A"
with "section 65"; and
• in paragraph (d) of the definition of notification to the
IBAC the reference to "section 19A" with "section 66".
Clause 22 amends section 140(4) of the Mental Health Act 2014, to
substitute "section 12" with "section 40".
Clause 23 amends section 14(2)(d)(ii) of the Parliamentary Committees
Act 2003, to insert after "audit" the words "or assurance review".
Clause 24 amends section 42(3) of the Public Health and Wellbeing
Act 2008 to substitute "section 12" with "section 40".
Part 4--Repeal of amending Act
Clause 25 provides for the repeal of the amending Act on 1 January 2020.
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