Mid Sweden University

Purpose

This article aims (i) to develop a classification scheme of different types of value for money (VFM) audits with different degrees of compliance audit, and (ii) to classify the performance audits carried out by the Swedish National Audit Office (SNAO) during its first six years as an independent state audit organisation reporting to parliament.

Design/methodology/approach

The empirical data was gathered from all of the 150 audit reports published by the SNAO from its establishment in 2003 to the end of 2008. Seminars were arranged to discuss the classifications for validation.

Findings

The focus on traditional VFM audits (the “Three Es”) is unusual. Most audits carried out by the SNAO combine different types of extended VFM audits with compliance audit. On the one hand, they audit how the government and/or central agencies fulfil their mandates (from good to bad). On the other hand, they audit how the government and/or central agencies adhere to legislation, rules and policies (right or wrong). In some cases, the SNAO equates compliance audit with performance audit.

Practical implications

We have verbalised and visualised performance audit activities of interest not only to state auditors, but to external stakeholders as well. One practical implication is that the Swedish national audit committee has conducted an evaluation of the SNAO that is partly based on our national report of this study, and has proposed a stronger focus on the Three Es.

Originality/value

The study addresses a new approach in terms of a classification scheme for performance audits, consisting of eight types of VFM audits and three degrees of compliance audit, and creating 24 possible combinations.