Harvesting Public Audit Knowledge: Implications for Theory and Practice

Abstract

For over three decades international public policy has dictated that not-for-profit organisations achieve economy, efficiency and effectiveness or 'value for money' (VfM). Across the globe VfM performance audits are deployed in order to promote compliance with this objective. Despite consistent political discourse, the current literature lacks conceptual integration of the factors that affect performance information and use, which frustrates efforts to better understand the factors that inhibit the emergence of VfM. Using the lens of information processing theory (IPT) this paper systematically analyses VfM audit reports produced by the Comptroller and Auditor General, Ireland. The contribution categorises strategic, operational and tactical barriers that affect the motivation, opportunity and ability to process information related to value for money. A key implication is that effectiveness needs to be reframed in terms of service-dominant (S-D) logic and is thus defined as value co-created by politicians, policy makers and public servants.

The contents of the National Audit Office of Finland performance audits, 2001–2016

“…The substantive concerns of performance auditing are often pragmatically summarised in terms of the "three Es" of "economy", "efficiency" and "effectiveness" (INTOSAI, 2004;NAOF, 2007, p. 7). Interestingly, the rare empirical scholar of the actual contents of government performance audit reports, McKevitt (2017), to a substantial extent elaborates upon nothing but the "three Es" division. Let us formulate our first research question: RQ1.…”

“…In what we call the extensive research dimension, countries in which government auditing is not institutionalised too differently from Finland and in which analogous (Ireland;McKevitt, 2017) or resembling studies (Sweden; Grönlund et al, 2011) to our study could be comparatively examined together with Finland. We see in this extension additional advantages as it enables probing the capability of the method we have used in examining texts published in different natural languages and in different although sufficiently comparable political and other contexts.…”

“…Accounting research using conventional quantitative content analysis used to be fairly common at the turn of the 1990s and the 2000s (Milne and Adler, 1999;Unerman, 2000;Guthrie et al, 2004), but we hardly could trace content analyses of government performance audit reports (except for McKevitt, 2017) despite that textual analysis is fairly common in accounting research (Loughran and McDonald, 2016). We shy away from ex ante researcher decisions on which textual elements in the research material might be important.…”

“…We contribute towards filling the empirical research gap we discerned given the dearth of research on the contents of government performance audit reports ( for an interesting exception, see McKevitt, 2017). However, research with indirect relevance for our study on nearby topics is ample.…”

“…The general contents of government accounting have been examined (Liguori et al, 2018). Frequent topics of academic research also comprise other than content aspects of government performance auditing in individual countries (Guthrie and Parker, 1999;Dirsmith et al, 2000;English and Guthrie, 2000;Sampaio de Freitas and Aquino Guimarães, 2007;Grönlund et al, 2011;Raudla et al, 2016;Taft, 2016;McKevitt, 2017;Reichborn-Kjennerud and Johnsen, 2018). Moreover, government performance auditing in two or more countries has often been contrasted (Gray et al, 1993;Pollitt et al, 1999;Rist, 1999;Furubo et al, 2002;Norton and Murphy Smith, 2008;Torres et al, 2019;Jeppesen et al, 2017).…”