With the Public Financial Management and Control Law no. 5018, the financial management and control system was changed with a new understanding, and the new system was built on the concepts of economy, efficiency, effectiveness, transparency and accountability. After the Law no. 5018 entered into force, the performance-based budgeting system was introduced and as a result, the public entities were required to present their mid to long term targets and objectives and indicators in their strategic plans. Additionally, it is envisaged that public entities prepare their budgets by associating them with annual performance objectives through performance programs. Also, they are required to report their performances in association with the relevant objectives and indicators via accountability reports.

The three documents in question, that is strategic plan, performance program and accountability report, form the basis of the performance-based budgeting system. By preparing these documents, public entities present their objectives, activities and performances to the public, local government assemblies and the Turkish Grand National Assembly. Through this mechanism, the target is to create a transparent and accountable financial management system.

Regarding the performance audit, Article 36 of the Law no. 6085 reads as follows: “Performance audit shall be carried out through measuring the activity results related to the objectives and indicators determined by entities within the framework of accountability”. As can be understood from this definition, the basis of performance audit is the performance information to be generated by the entities. The findings obtained about institutional performance through the examination of the performance information of entities are reported via performance audit.

In order to fulfil the requirements of the Law no. 5018 and Law no. 6085 and to present the audit methodology to be implemented, a Performance Audit Manual was prepared and performance audits are conducted in line with this manual along with regularity audits. Results of these audits are included in a separate section in the TCA Audit Report.