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ACCA Strategic Professional · Advanced Audit and Assurance (International)

The Audit of Performance Information (Pre-Determined Objectives) in the Public Sector

Auditing performance information means checking whether a public body's reported results against its pre-determined objectives are useful, reliable and properly reported. You plan the work, test that criteria and indicators are suitable, gather evidence on the reported figures, and report findings. In the exam, apply each step to the scenario.

What this chapter covers

This chapter covers assurance on non-financial results. Public bodies set objectives in advance, such as services delivered, targets met or outcomes achieved. They then report against indicators. The auditor gives a view on whether that reported information can be relied on.

The work follows the same logic as any assurance engagement: understand the entity, assess risk, set criteria, gather evidence, conclude and report. The difference is the subject matter. Instead of ledgers, you test indicators, targets, systems for collecting data and the link between objectives and reported results. Value for money ideas (economy, efficiency and effectiveness) sit alongside this.

In AAA, this chapter connects to planning, risk assessment, evidence, ethics, reporting and other assurance engagements. Section A case studies and Section B questions are scenario-based and written. You will be expected to use the same professional judgement and scepticism you apply to a financial statement audit, but adapted to a public sector setting.

Every AAA question is written, compulsory and carries professional skills marks, so a chapter like this tests how well you apply familiar audit steps to an unfamiliar subject. Students who learn the structure (objectives, criteria, indicators, evidence, reporting) can score on a new scenario without memorising a list. The chapter also reinforces planning, evidence and reporting, which appear throughout the paper, so the effort pays back more than once.

The audit of performance information (pre-determined objectives) in the public sector: topics in the order to study them

  1. 1Performance Information in the Public SectorStart here to learn what pre-determined objectives, indicators and targets are, and why public bodies report on them.
  2. 2Planning the Audit of Performance InformationOnce you know the subject matter, you can see how scope, risk and materiality are set for the engagement.
  3. 3Assessing Suitability of Criteria and IndicatorsCriteria drive everything that follows, so you need to judge them before you design any testing.
  4. 4Evidence and Procedures for Performance InformationWith criteria agreed, you can choose procedures to test the data and the systems that produce it.
  5. 5Reporting on Performance Information and Value for MoneyReporting is the end point, and it only makes sense once you know what evidence supports your conclusion.

How to prepare The audit of performance information (pre-determined objectives) in the public sector

Treat this chapter as an assurance engagement in miniature. Learn the flow once, then practise applying it to short scenarios.

  1. Write a one-page flow: objectives, indicators, targets, data systems, reported results. Be able to redraw it from memory.
  2. Learn the qualities of a good indicator in your own words, and for each one note how you would spot a failure in a scenario.
  3. Link planning steps to risks: for each risk (poor data, unclear targets, weak systems), note the response you would plan.
  4. List procedures by type: inspection, recalculation, inquiry, observation, analytical procedures and re-performance, and match each to a performance data source.
  5. Practise past-style written questions. Answer the requirement first, then tie each point to a fact in the scenario.
  6. Add professional skills: show scepticism about management's claims, give commercial reasoning, and keep your report conclusions clear and concise.
  7. Finish by drafting short report extracts and judging whether a conclusion should be modified, and why.

Common mistakes in The audit of performance information (pre-determined objectives) in the public sector

  • Listing generic audit steps without applying them to the public body in the scenario.

    Fix: Quote or refer to a specific fact in every paragraph and explain what it means for the audit.

  • Confusing economy, efficiency and effectiveness.

    Fix: Define each in one line: cost of inputs, output per input, and achievement of intended results. Use a small example for each.

  • Testing only the reported figure and ignoring the system behind it.

    Fix: Always consider how data is captured, recorded, aggregated and reviewed, and test controls over that process.

  • Accepting the criteria as given.

    Fix: Assess whether criteria and indicators are relevant, clear and measurable before planning procedures.

  • Vague reporting points such as 'report any problems'.

    Fix: State what you would find, what it means, and how it affects the form of conclusion.

  • Ignoring professional skills marks.

    Fix: Show scepticism, analyse the facts, give commercial reasoning and write in a clear, structured style.

Last-day revision: The audit of performance information (pre-determined objectives) in the public sector

  • Pre-determined objectives are set in advance and results are reported against them.
  • Performance information is mostly non-financial, so evidence often comes from systems and records, not ledgers.
  • Good criteria are clear, relevant and capable of consistent measurement.
  • Indicators should link directly to the stated objectives.
  • Targets need a defined measure, a baseline and a time frame.
  • Plan using risk: unreliable data, complex measures and weak controls raise risk.
  • Test the data collection system as well as the reported number.
  • Use recalculation, inspection and inquiry, and corroborate management's answers.
  • Economy, efficiency and effectiveness are the usual value for money lenses.
  • Reports must state the criteria used and the basis for the conclusion.
  • Unsupported or misleading indicators can lead to a modified conclusion.
  • Always apply points to the scenario and show professional skills.

The audit of performance information (pre-determined objectives) in the public sector practice questions

The audit of performance information (pre-determined objectives) in the public sector in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

The audit of performance information (pre-determined objectives) in the public sector: frequently asked questions

What is performance information in a public sector audit?

It is the non-financial and financial results a public body reports against its pre-determined objectives. Examples include services delivered, targets met and outcomes achieved. The auditor assesses whether this reporting can be relied on.

How is this different from a financial statement audit?

The process is similar: plan, assess risk, gather evidence and report. The difference is the subject matter and criteria. You test indicators, targets and data systems instead of account balances.

What makes an indicator suitable?

It should link to the objective, be clear, and be measurable in a consistent way. You should also be able to get reliable data for it at reasonable cost. If it fails these, your plan should reflect that risk.

How should I answer a question on this chapter in the exam?

Read the requirement, then use a short structure such as criteria, risks, procedures and reporting. Tie each point to the scenario and explain why it matters. This earns both technical and professional skills marks.