Project Procurement Management: Analyzing Financial Audit Report

This report investigates the findings of financial audits conducted on universities and TAFEs in Western Australia, focusing on financial transactions up to December 31, 2017. The audit revealed management control weaknesses and information system control issues across the educational institutions. While universities showed better financial performance, TAFEs faced challenges related to declining funding and land/building issues. The analysis emphasizes the importance of regular audit reporting, especially for TAFEs, to address financial and managerial problems, and recommends improved monitoring and evaluation of financial reporting to ensure better exposure to funding opportunities. This document is available on Desklib, where students can find a wide array of study resources, including solved assignments and past papers.

Running head: PROJECT PROCUREMENT MANAGEMENT
Project Procurement Management
Name of the Student
Name of the University
Author Note

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Description of the issue the report investigated
The audit report in discussion focuses on one created on the findings of the financial
audits of several universities and Technical and Further Educational institutes or TAFEs in
Western Australia (Knechel, Robert and Salterio 2016). The Audit Report had recorded the
financial transactions of the reporting periods ending as on 31 December 2017. The total number
of universities and Technical and Further Educational institutes or TAFEs in Western Australia
that were taken in consideration for the audit report were 9 in total, comprising of 4 universities
and 5 TAFEs. Amongst these 5 TAFEs, 2 were metropolitan and 3 were regional. The total
combined amount of assets for these 9 educational institutes was a total of 7.6 billion AUD
where 6.3 billion AUD belonged to the universities and the rest 1.3 billion AUD to the TAFEs.
The findings of the educational institutes were taken into account to look into the fact that all the
funding for the universities was increasing at a marginal level, but the TAFEs had declines
funding including the Commonwealth as well as the State Funding.
This is why, it became important that timely audit report on the accurate financial reports
were made to find the reason for the decline in funding for the TAFEs and if there has been any
irregularities in the financial reporting due to the manual or electronically transaction recording
procedures (Wu et al. 2016). After the audit report was completed, there were several issues
detected within the financial reporting of the universities and the TAFEs, which mostly were
identified to be management and financial performance issues. Almost 60 management control
weaknesses were detected along with 114 information system control issues in all the
educational institutes. It was found that almost 3 per cent of the issues were detected but were
unresolved and in the following year the unresolved issues were raised to 36 per cent. The
management issues increased the loss at 321 million AUD. On the other hand, the financial

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performance issues stated that the Universities are at a better position but the TAFEs had
involved land and building issues along with low to medium risks against KPIs which increased
the risk levels slightly in the year 2017.
Critical analysis and recommendations for improvement
According to the findings, it can be stated that the Universities and TAFEs both had
management issues but the universities fared better when it came to financial performances.
According to Guan et al. (2016), the managerial problems does not appear to cause financial
issues in the business process at an initial level, but with increasing time it accumulates much
more financial loss and causes harm to the reputation of the organization or the institution. The
TAFEs are situated in the regional areas as well which causes lesser exposure to the financers,
thus resulting in considerable low funding. The auditing is also not regular, which is an added
disadvantage while finding out the financial and managerial issues in the institutions.
Thus it is recommended that the audit reporting should be done every year end and not
after many years combined (Chan et al. 2018). Proper monitoring and evaluating of the financial
reporting should be done focusing especially on the TAFEs and more initiative should be taken
to make the TAFEs be exposed to the Commonwealth and State funding.

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References
Wu, Chloe Yu-Hsuan, Hwa-Hsien Hsu, and Jim Haslam. "Audit committees, non-audit services,
and auditor reporting decisions prior to failure." The British Accounting Review 48, no. 2 (2016):
240-256.
Chan, David Y., and Miklos A. Vasarhelyi. "Innovation and practice of continuous auditing."
In Continuous Auditing: Theory and Application, pp. 271-283. Emerald Publishing Limited,
2018.
Guan, Yuyan, Lixin Nancy Su, Donghui Wu, and Zhifeng Yang. "Do school ties between
auditors and client executives influence audit outcomes?." Journal of accounting and
economics 61, no. 2-3 (2016): 506-525.
Knechel, W. Robert, and Steven E. Salterio. Auditing: Assurance and risk. Routledge, 2016.