Department of Home Affairs

The Department of Home Affairs coordinates policy and operations for Australia’s national and transport security, federal law enforcement, criminal justice, cyber security, border, immigration, multicultural affairs, emergency management and trade-related functions.

The department’s total budgeted expenses for 2019–20 are just over $4.6 billion, with 51 per cent of these expenses attributable to supplier expenses, as shown in Figure 2.

Figure 2: Department of Home Affairs’ total budgeted expenses by category ($’000)

Source: ANAO analysis of PBS 2019–20 Budget related papers pre–machinery-of-government changes announced on 29 May 2019.

The six key risks for the department’s 2018–19 financial statements that the ANAO has highlighted for specific audit coverage in 2019–20, including those that the ANAO considers potential Key Audit Matters (KAMs), are the:

• accuracy and completeness of customs duty collections and refunds, due to the self-assessment regime and complexity of the related IT systems (KAM – Completeness and accuracy of customs duty);
• accuracy and completeness of visa revenue, as this is collected through a number of domestic and international locations, by both departmental staff and third parties under service level agreements, using a number of IT systems (KAM – Completeness and accuracy of visa application charges);
• management of, and accounting for, the onshore and offshore detention network and processing centres. Third-party providers are engaged for health services, centre management and the construction of assets under a variety of complex service delivery contract arrangements. In addition, the valuation of land and buildings associated with the detention and processing centres is subject to judgement and estimation (KAM – Accuracy of detention and regional processing centre expenses and valuation of the associated non-financial assets);
• payment of personal benefits to specific visa holders under third-party arrangements with Services Australia and other providers, where the eligibility criteria for the categories of allowable personal benefits are complex and subject to change;
• accounting for employee benefits, due to selected departmental staff being entitled to a range of allowances, subject to a number of varying conditions. Staff are also located both in Australia and overseas, including locally engaged staff who may be entitled to varying employment conditions and benefits based on local laws and regulations; and
• reporting of overseas transactions managed under third-party arrangements through service level agreements with the Department of Foreign Affairs and Trade, and the Australian Trade and Investment Commission.

Australian Federal Police

The Australian Federal Police (AFP) is responsible for the provision of police services in relation to laws of the Commonwealth, the provision of policing services to the Australian Capital Territory and external territories, combatting transnational serious organised crime and terrorism, disrupting crime offshore, supporting regional security, and protecting Australian interests and assets.

The AFP’s total budgeted expenses for 2019–20 are just over $1.5 billion, with 59 per cent of these expenses attributable to employee benefits, as shown in Figure 3.

Figure 3: Australian Federal Police’s total budgeted expenses by category ($’000)

Source: ANAO analysis of PBS 2019–20 Budget related papers pre–machinery-of-government changes announced on 29 May 2019.

The AFP’s two key risks for its financial statements are:

• the recognition and measurement of payroll, due to its size and complexity and the underpayment of superannuation on allowances in prior years; and
• IT general controls, due to unresolved audit findings from prior years.

Australian Security Intelligence Organisation

The Australian Security Intelligence Organisation (ASIO) is responsible for protecting Australia, its people and its interests from threats to security through intelligence collection, assessment, and advice to the government.

ASIO’s total budgeted expenses for 2019–20 are just over $579 million, with 48 per cent of these expenses attributable to employee benefits, as shown in Figure 4.

Figure 4: Australian Security Intelligence Organisation’s total budgeted expenses by category ($’000)

Source: ANAO analysis of PBS 2019–20 Budget related papers pre–machinery-of-government changes announced on 29 May 2019.

ASIO’s key risk for its financial statements is the accuracy and completeness of employee benefits, due to reliance on manual calculations because of limitations in the current payroll system.