Statement of Responsibility and Independent Auditor's Report

Statement of Responsibility

In accordance with section 45C of the Public Finance Act 1989, I am responsible, as Chief Executive of the Department of Corrections, for:

  • the preparation of the Department’s financial statements, and Statement of Departmental Expenditure and Capital Expenditure, and for the judgements expressed in them
  • having in place a system of internal control designed to provide reasonable assurance as to the integrity and reliability of financial reporting
  • ensuring that end-of-year performance information on each appropriation administered by the Department is provided in accordance with sections 19A to 19C of the Public Finance Act 1989, whether or not that information is included in this annual report
  • the accuracy of any end-of-year performance information prepared by the Department, whether or not that information is included in the annual report.

In my opinion the financial statements and Statement of Performance, including the forecast financial statements fairly reflect the financial position of the Department as at 30 June 2016 and the result of its operations for the year ended on that date.

Ray Smith, Chief Executive

Neil Cherry, Deputy Chief Executive Finance, Property and Technology

30 September 2016


Independent Auditor's Report

To the readers of the Department of Correction's annual report for the year ended 30 June 2016

The Auditor-General is the auditor of the Department of Corrections (the Department). The Auditor-General has appointed me, Clint Ramoo, using the staff and resources of Audit New Zealand, to carry out the audit on her behalf of:

  • the financial statements of the Department on pages 115 to 151, that comprise the statement of financial position, statement of commitments, statement of contingent liabilities and contingent assets and statement of trust monies as at 30 June 2016, the statement of comprehensive revenue and expense, statement of changes in taxpayer’s funds, and statement of cash flows for the year ended on that date and the notes to the financial statements that include accounting policies and other explanatory information;
  • the performance information prepared by the Department for the year ended 30 June 2016 on pages 26 to 76 and 84 to 112
  • the statements of expenses and capital expenditure of the Department for the year ended 30 June 2016 on pages 153 to 154.
OPINION

In our opinion:

  • the financial statements of the Department:
    • present fairly, in all material respects:
      • its financial position as at 30 June 2016; and
      • its financial performance and cash flows for the year ended on that date;
    • comply with generally accepted accounting practice in New Zealand and have been prepared in accordance with Public Benefit Entity (PBE) Reporting Standards
  • the performance information of the Department:
    • presents fairly, in all material respects, for the year ended 30 June 2016:
      • what has been achieved with the appropriation; and
      • the actual expenses or capital expenditure incurred compared with the appropriated or forecast expenses or capital expenditure;
      • complies with generally accepted accounting practice in New Zealand.
  • the statement of expenses and capital expenditure of the Department on pages 153 to 154 are presented fairly, in all material respects, in accordance with the requirements of section 45A of the Public Finance Act 1989.

Our audit was completed on 30 September 2016. This is the date at which our opinion is expressed.

The basis of our opinion is explained below. In addition, we outline the responsibilities of the Chief Executive and our responsibilities, and we explain our independence.

BASIS OF OPINION

We carried out our audit in accordance with the Auditor-General’s Auditing Standards, which incorporate the International Standards on Auditing (New Zealand). Those standards require that we comply with ethical requirements and plan and carry out our audit to obtain reasonable assurance about whether the information we audited is free from material misstatement.

Material misstatements are differences or omissions of amounts and disclosures that, in our judgement, are likely to influence readers’ overall understanding of the information we audited. If we had found material misstatements that were not corrected, we would have referred to them in our opinion.

An audit involves carrying out procedures to obtain audit evidence about the amounts and disclosures in the information we audited. The procedures selected depend on our judgement, including our assessment of risks of material misstatement of the information we audited, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Department’s preparation of the information we audited in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Department’s internal control.

An audit also involves evaluating:

  • the appropriateness of accounting policies used and whether they have been consistently applied;
  • the reasonableness of the significant accounting estimates and judgements made by the Chief Executive;
  • the appropriateness of the reported performance information within the Department’s framework for reporting performance;
  • the adequacy of the disclosures in the information we audited; and
  • the overall presentation of the information we audited.

We did not examine every transaction, nor do we guarantee complete accuracy of the information we audited. Also, we did not evaluate the security and controls over the electronic publication of the information we audited.

We believe we have obtained sufficient and appropriate audit evidence to provide a basis for our audit opinion.

RESPONSIBILITIES OF THE CHIEF EXECUTIVE
  • The Chief Executive is responsible for preparing:
  • financial statements that present fairly the Department’s financial position, financial performance, and its cash flows, and that comply with generally accepted accounting practice in New Zealand and PBE Standards;
  • performance information that presents fairly what has been achieved with each appropriation, the expenditure incurred as compared with expenditure expected to be incurred, and that complies with generally accepted accounting practice in New Zealand.
  • statement of expenses and capital expenditure, that are presented fairly, in accordance with the requirements of the Public Finance Act 1989.

The Chief Executive’s responsibilities arise from the Public Finance Act 1989.

The Chief Executive is responsible for such internal control as is determined is necessary to ensure that the annual report is free from material misstatement, whether due to fraud or error. The Chief Executive is also responsible for the publication of the annual report, whether in printed or electronic form.

RESPONSIBILITIES OF THE AUDITOR

We are responsible for expressing an independent opinion on the information we are required to audit, and reporting that opinion to you based on our audit. Our responsibility arises from the Public Audit Act 2001.

INDEPENDENCE

When carrying out the audit, we followed the independence requirements of the Auditor-General, which incorporate the independence requirements of the External Reporting Board.

Other than the audit, we have no relationship with or interests in the Department.

Clint Ramoo

Audit New Zealand

On behalf of the Auditor-General

Wellington, New Zealand


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