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External scrutiny

Reports by the Australian National Audit Office

The Auditor-General tabled in Parliament 13 audit reports relevant to departmental operations: one audit examining the department's passport services and 12 cross-agency audits. The department provided six-monthly reports to the Joint Committee on Public Accounts and Audit (JCPAA) on follow-up action taken in response to these ANAO reports.

Report No. 37: Passport services

This audit assessed the effectiveness of the department's passport issuing processes in Australia. In particular, the audit focused on whether the department had effective strategies for managing passport services; provided quality client service; and had effective and secure processes for passport issue to entitled persons. The ANAO made four recommendations aimed at strengthening performance management and reporting of passport services, as well as enhancing operational procedures. The department agreed with the four recommendations and has made substantial progress in their implementation.

The relevant cross-agency ANAO reports were:

Report No. 8: Senate Order for department and agency contracts

This audit was conducted to assess agency performance in relation to compiling website listings required by the Order and the appropriateness of the use of confidentiality provisions in contracts. The department has implemented both recommendations.

Report No. 16: Administration of grants (post-approval) in small to medium organisations

This audit assessed whether small-to-medium organisations had implemented appropriate risk management strategies for grant programs and if grants had been administered in accordance with the appropriate legislation and government guidance. The department's foundations, councils and institutes, which administer the majority of departmental grant funding, had been subject to an internal review in May 2002 in line with an ANAO best practice guide. That review addressed four of the seven recommendations. The department is monitoring the progress of the implementation of the remaining three.

Report No. 18: Management of trust monies

The audit reviewed the management of trust monies in five government organisations to assess whether they were being managed in accordance with legal and administrative requirements and better practice principles. The department obtained advice from the Australian Government Solicitor to clarify the legal status of some monies which were being reported as Special Accounts. This advice confirmed that the department's treatment of its Special Accounts was correct.

Report No. 22: Payment of accounts and goods and services tax administration by small Commonwealth organisations

The audit examined the appropriateness of risk management strategies and whether organisations had made effective use of technology in the payment of accounts process, particularly with regard to GST obligations and transactions. The department had already implemented the report's seven recommendations before the report's release.

Report No. 23: Physical security arrangements in Commonwealth agencies

This audit evaluated the protective security policies and practices of seven government agencies to determine whether they had established an appropriate physical security control framework based on the principles outlined in the Commonwealth Protective Security Manual. All six recommendations have been implemented by the department.

Report No. 24: Energy efficiencies in Commonwealth operations—follow-up audit

The audit reviewed the extent to which selected government agencies had implemented the recommendations of Report No. 47 of 1998–99. The ANAO report provided a useful review and assessment of policies and implementation measures being undertaken in the public sector. This information is assisting the department in the continuing development of a comprehensive environmental management system.

Report No. 27: Management of Commonwealth guarantees, warranties, indemnities and letters of comfort

The audit reviewed the extent of improvement in agencies' management and monitoring of the Government's exposure to guarantees, warranties, indemnities and letters of comfort; changes in the size and nature of its reported exposure since 30 June 1997; and the approach of agencies to effective risk management and control. Only two of the three recommendations applied as the department does not hold substantial instruments; both recommendations have been implemented.

The department is currently examining the recommendations contained in the following five cross-agency reports, tabled in June 2003:

Courts and administrative tribunals

Twenty-one legal matters were resolved during the reporting period. Of these, 14 matters were resolved in favour of the department, four were settled and three claims against the department were withdrawn. Details of these and other matters currently before the courts and administrative tribunals are at Appendix 7.

Parliamentary committees

The department made submissions or gave evidence to 17 parliamentary committee inquiries. In addition, departmental staff appeared before the Joint Standing Committee on Treaties on 11 occasions in relation to proposed treaty actions. See Appendix 6 for further information.


The Commonwealth Ombudsman investigated 35 issues with respect to the department's activities in 2002–03 and arrived at 11 negative findings. No formal reports were issued.


We managed effectively the process for adoption of all portfolio-related legislation. The Charter of the United Nations Amendment Act 2002 was assented to on 10 December 2002. The Non-Proliferation Legislation Amendment Bill 2003 was introduced into Parliament on 26 June 2003 proposing measures to strengthen arrangements for the protection of nuclear facilities, material and related information. The department facilitated the enactment and variation of several regulations including the Timor Sea Treaty Designated Authority (Privileges and Immunities) Regulations, the Passports Regulations and regulations pursuant to the Charter of the United Nations Act 1945. We contributed to development of legislation initiated by other portfolios that affected the foreign affairs and trade portfolio.

Compensation for detriment caused by defective administration

Three cases were lodged under the compensation scheme for detriment caused by defective administration. All three cases remained in progress at the end of the financial year. No payments were made from either departmental or administered funds.


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Department of Foreign Affairs and Trade Annual Report 2002–2003
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