The use of internal audit for corruption: A discussion on NSW and Federal Government in Australia

The paper aims to discuss the increasing use of internal audit as a technology by government against corruption. We study this, in particular, in the state of New South Wales (NSW) and in the Federal Government of Australia. The conceptual space is that the implications of new public management in the public sector provokes the employment proliferation of many forms of control, and we understand internal audit in that context. Auditing (external, internal, performance) constitutes a set of apparatuses of control. From a neoliberal perspective, public policies are justified by how they improve efficiency, efficacy and accountability. We challenge the role of internal audit, as a technology against corruption, as we examine the discursive extension of internal audit into the corruption space also constitutes an attempt at extending control, as a technology of governance. In Australian politics, there has been a significant focus on corruption activities. This is in the context of systematic cases of corruption in the public sector in a variety of contexts and across a variety of forms of corruption. Precise definitions of corruption are unclear. We are interested in the extension of the ambit of control of internal audit into corruption debates, as this seems to extend the logic of trust in technocratic experts at the centre of Power (1997) Audit Society. At the heart of our concerns with the effectiveness of internal audit with respect to corruption is that this seems to change the nature of the internal audit process, which focuses on efficacy with respect to organisational process. The extension to corruption seems to ask internal audit to take on a significant role in surveillance, as a mechanism of control. Consequently, we see regulatory bodies promote the use of internal audit for preventing and detecting corruption in Australia. This is certainly the case in a number of decisions or pronouncements of the Independent Commission Against Corruption (ICAC) in NSW. The Federal Government has subsequently considered a Federal ICAC in Australia to be important. Our theoretical approach on surveillance and questions the appropriateness of the use of internal audit as a mechanism of control. The concept of surveillance is based on the French philosopher Jean Baudrillard. In this, powers are more disperse and they became impossible to locate in a virtual, interchangeable and dynamic societies. The forms of surveillance using internal control are a powerful technology. We employ a discourse analysis to understand and evaluate the use of internal audit – a governance technology – in the NSW ICAC guidelines and seven investigation cases (Operations Tarlo, Credo, Artek, Ricco, Scania, Nestor and Greer) as well as a reflection on the current state of affair of the lobbying for a Federal ICAC in Australia. It is a political paper situated in an interdisciplinary approach for accounting, business and finance studies gathering information from the politics of corruption in Australia.