Wiley Federal Government Auditing: Laws, Regulations, Standards, Practices, and Sarbanes-Oxley, 2nd Edition

CHAPTER 14

PERFORMANCE AUDITS

Different Scopes, Different Folks, Different Reports

PERFORMANCE AUDITING: MINIMAL GUIDANCE, NO SAFE HARBORS

Performance Audits: Origin and Credits

Performance audits generally assess the efficiency and effectiveness of operations and programs. The objectives, purposes, and scope of such audits vary with the parties desiring a performance audit. Financial audits have the support of over 100 years of uniformity, documented precedent, precise guidance, and general acceptance. Performance audits, however, lack uniformity, have little precedent, minimal guidance, and, at times, lack auditee acceptance. Nonetheless, performance audits are valuable and are often demanded to answer important questions left unanswered by annual financial statement audits, particularly in the public sector.

While many assume that accountants “invented” performance auditing, this method of evaluation and analysis is practiced possibly to a greater degree in the social sciences and other disciplines. For years, nonaccountants have conducted scores of successful performance audits that blend the scientific research method (who, what, when, where, why, and how) with rigorous social research techniques and rather different data-gathering and documentation practices. Such approaches merge cross-disciplinary skills and practices, placing greater emphasis on current or contemplated activity and performance, in contrast to the historical emphasis of an accountant’s audit of financial ...