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Practice Guide to Auditing Efficiency

Performance monitoring and reporting

Table 1(f) - Knowledge of business questions for an audit of efficiency focused on application processes

Note: Additions to the questions and risks in the Practice Guide are shown in italics.

Potential Risks to Efficiency

Knowledge of Business Questions

  • There is a lack of attention to the efficiency of application processing.
  • There is a lack of performance information or insufficient attention to available information.
  • Efficiency performance information is not reliable and relevant.
  • Does the organization monitor, and report on, the efficiency, quality, and level of service of the main services it delivers? How and how often is this reporting done?
  • Does the entity have performance information on its application-processing activities, such as
    • numbers of applications received;
    • results by type of action taken, such as number of applications approved and rejected; and
    • inputs utilized, such as number of staff and funds spent by major category of application?
  • Does the organization have information to show whether efficiency targets and standards are being met?
  • Does the organization have information to show how efficiency, quality, and levels of service have changed over time for the services it delivers? Is the entity becoming more efficient or less efficient? Consider the ratio of inputs (such as financial resources and staff) to outputs (activity such as applications assessed and licences issued) over time.
  • Does the organization have mechanisms in place to assess and report on the root causes of any significant change in performance?
  • Does the organization have a clear strategy for benchmarking each of its main services in order to assess their relative efficiency? Has the type of benchmark information required been clearly defined? What are the benchmarks?
  • When performance is inferior to benchmarks, is there evidence that actions are being taken to improve performance?
  • Has the organization found any barriers in providing and obtaining benchmarking information? What are the strategies for overcoming any barriers?
  • Does the organization regularly report progress against its efficiency objectives and initiatives? To whom does it report?
  • Is the organization able to demonstrate the efficiency gains achieved from individual projects? How have these gains improved the services delivered? Do reported efficiency gains include information on upfront investments and recurrent costs incurred in delivering efficiency gains?
  • Does management have concerns about the relevance, reliability, timeliness, or completeness of performance information related to efficiency? What are the data sources for efficiency performance information?

Source: Many of these questions have been adapted from Northern Ireland Audit Office’s Improving Public Sector Efficiency: Good Practice Checklist for Public Bodies (2010), as well as from recent audits of efficiency.