Land Transport New Zealand Annual Report

Audit report

To the readers of Land Transport New Zealand's financial statements

For the year ended 30 June 2007

The Auditor-General is the auditor of Land Transport New Zealand. The Auditor-General has appointed me, John O’Connell, using the staff and resources of Audit New Zealand, to carry out the audit on his behalf. The audit covers the financial statements and statement of service performance included in the annual report of Land Transport New Zealand for the year ended 30 June 2007.

Unqualified opinion

In our opinion:

• The financial statements of Land Transport New Zealand on pages 56 to 73:
  • comply with generally accepted accounting practice in New Zealand; and fairly reflect:
    • Land Transport New Zealand’s financial position as at 30 June 2007; and
    • the results of its operations and cash flows for the year ended on that date.
• The statement of service performance of Land Transport New Zealand on pages 32 to 55:
  • complies with generally accepted accounting practice in New Zealand; and
  • fairly reflects for each class of outputs:
    • its standards of delivery performance achieved, as compared with the forecast standards outlined in the statement of forecast service performance adopted at the start of the financial year; and
    • its actual revenue earned and output expenses incurred, as compared with the forecast revenues and output expenses outlined in the statement of forecast service performance adopted at the start of the financial year.

The audit was completed on 11 October 2007, and is the date at which our opinion is expressed.

The basis of our opinion is explained below. In addition, we outline the responsibilities of the Board and the Auditor, and explain our independence.

Basis of opinion

We carried out the audit in accordance with the Auditor-General’s Auditing Standards, which incorporate the New Zealand Auditing Standards.

We planned and performed the audit to obtain all the information and explanations we considered necessary in order to obtain reasonable assurance that the financial statements and statement of service performance did not have material misstatements, whether caused by fraud or error.

Material misstatements are differences or omissions of amounts and disclosures that would affect a reader’s overall understanding of the financial statements and the statement of service performance. If we had found material misstatements that were not corrected, we would have referred to them in our opinion.

The audit involved performing procedures to test the information presented in the financial statements and statement of service performance. We assessed the results of those procedures in forming our opinion.

Audit procedures generally include:

• determining whether significant financial and management controls are working and can be relied on to produce complete and accurate data;
• verifying samples of transactions and account balances;
• performing analyses to identify anomalies in the reported data;
• reviewing significant estimates and judgements made by the Board;
• confirming year-end balances;
• determining whether accounting policies are appropriate and consistently applied; and
• determining whether all financial statement and statement of service performance disclosures are adequate.

We did not examine every transaction, nor do we guarantee complete accuracy of the financial statements or statement of service performance.

We evaluated the overall adequacy of the presentation of information in the financial statements and statement of service performance. We obtained all the information and explanations we required to support our opinion above.

Responsibilities of the Board and the Auditor

The Board is responsible for preparing financial statements and a statement of service performance in accordance with generally accepted accounting practice in New Zealand. The financial statements must fairly reflect the financial position of Land Transport New Zealand as at 30 June 2007 and the results of its operations and cash flows for the year ended on that date. The statement of service performance must fairly reflect, for each class of outputs, Land Transport New Zealand’s standards of delivery performance achieved and revenue earned and expenses incurred, as compared with the forecast standards, revenue and expenses adopted at the start of the financial year. The Board’s responsibilities arise from the Crown Entities Act 2004.

We are responsible for expressing an independent opinion on the financial statements and statement of service performance and reporting that opinion to you. This responsibility arises from section 15 of the Public Audit Act 2001 and the Crown Entities Act 2004.

Independence

When carrying out the audit we followed the independence requirements of the Auditor-General, which incorporate the independence requirements of the Institute of Chartered Accountants of New Zealand.

In addition to the audit we have carried out assignments during the reporting period in the areas of review of the costing methodology for proposed changes to the transport services licensing fees and charges and retrospective assurance over a tender process. These assignments are compatible with those independence requirements. Other than the audit and these assignments, we have no relationship with or interests in Land Transport New Zealand.

 

John O’Connell
Audit New Zealand
On behalf of the Auditor-General
Wellington, New Zealand

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Page created: 14 November 2007