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Practice Guide to Auditing Efficiency

Determining the Audit Focus

When planning a performance (value-for-money) audit that will integrate efficiency considerations, auditors will need to decide the focus of the audit. Focus relates to the level or degree of attention given to efficiency in a performance audit.

The Spectrum of Focus

There are many ways in which a performance audit can integrate efficiency considerations. Some audits will focus exclusively on efficiency while others will only cover efficiency as a secondary topic. This varying level of effort and focus directed at efficiency can be thought of as a spectrum (Figure 5) along which are different categories, from “marginal or no focus” to “exclusive focus”:

  • Marginal or no focus—There is no formal plan to audit efficiency, but the issue comes up during an audit.
  • Non-specific focus—Some audit steps touch on efficiency even though there is no specific efficiency criterion. 
  • Specific focus—Structured audit work on efficiency is part of a larger audit.
  • Exclusive focus—This is an efficiency-focused audit (or stand-alone efficiency audit).

Figure 5

The Spectrum of Audits of Efficiency

The Spectrum of Audits of Efficiency

Audit work on efficiency will also vary along other dimensions. For example, an audit of efficiency could:

  • Be government-wide, sector-specific, or entity-specific.
  • Look at routine management systems or at specialized efficiency improvement frameworks or initiatives.
  • Focus on the efficiency of controls, on the efficiency of operations, or both.