Departments are accountable to Parliament and the community for what they achieve using public funds. They must accurately report their performance in the Budget papers and their annual reports because this information is essential to identify what is working and what areas need improvement.

Over the last 20 years, numerous audits have found significant and persistent weaknesses in departments' performance reporting, including weak links between the objectives they set and the way they measure success.

This audit examined all eight departments and selected the following three for further analysis as case studies: the departments of Treasury and Finance (DTF), Education and Training (DET) and the former Health and Human Services (DHHS).

Key findings:

• Departments do not measure or report on their performance well.
• There are too many input and process measures and poorly constructed output measures and objective indicators in the Budget papers. This obfuscates departments' performance reporting and diminishes their accountability.
• The Auditor-General's Office continues to find the same issues whenever they examine departments' performance reporting, which indicates the need for a 'root and branch' review of the entire performance reporting framework.

This audit report provides 11 recommendations to all departments to improve the quality of the information in their performance statements, maintain complete data dictionaries, and improve their explanations of variances between actual and targets.