WA Attorney-General Michael Mischin has all but ruled out changing the law to allow the auditor-general to scrutinise Cabinet documents and articles protected by legal professional privilege.

The Office of the Auditor-General yesterday released its annual report and flagged the idea of amending the Auditor-General Act 2006.

Auditor-General Colin Murphy said the Act was mostly adequate but could be improved to remove barriers preventing him doing his job.

"In particular, access constraints to documents protected by Cabinet-in-confidence or legal professional privilege have impacted recent audits," Mr Murphy said in the annual report.

"The ability to gather sufficient and appropriate evidence is a fundamental audit requirement and in worst-case scenarios can prevent an auditor from issuing an audit opinion."

But Mr Mischin said legal professional privilege was a fundamental legal right.

"It does seem to me the auditor-general has been able to do his job in the past without access to material that is legally protected," Mr Mischin said.

"If advice is provided to the auditor-general without some stringent protections by law, anyone can then have access to that material and [that] can jeopardise the legal position of the state.

"It can jeopardise the legal position of the contractors that are dealing with the state in good faith."

Mr Mischin did however suggest that problem could be dealt with.

"It's an issue that may need to be addressed through legislative changes that will allow the auditor-general to have access to certain materials but protecting and preserving legal professional privilege," he said.

The Office of the Auditor-General is currently undergoing a performance review by a parliamentary committee which will then review the Act which governs the office's operations.

The legislation is expected to be examined after the parliamentary committee completes its performance review in November.

Perth Stadium row

The inability of the auditor-general to access Government commercial-in-confidence documents and legal advice was highlighted in a report tabled last month.

Mia Davies defended the Government's refusal to let the auditor-general review legal advice relating to Perth Stadium. ( ABC News: Andrew O'Connor )

The auditor-general had scrutinised three decisions by Minister for Sport and Recreation Mia Davies to not provide information to Parliament about contractual arrangements and payments for the new Perth Stadium.

The Opposition has pursued the Government for months on the total cost of the project, including ongoing monthly payments to the Westadium consortium for 25 years to cover services and maintenance.

The minister had declined to provide either information from the contract or a non-redacted copy of the contract, based on legal advice to her department claiming the information was commercial-in-confidence.

In trying to assess the validity of that decision, the auditor-general sought the legal advice provided by the State Solicitor's Office, but was denied access on the basis the advice itself was covered by legal professional privilege.

As a result, Mr Murphy reported he had been unable to form an opinion on whether the minister's decision to not provide the information to Parliament was appropriate and reasonable.

In Parliament on Wednesday afternoon, the Opposition again questioned the Government over the cost of the 25-year payments, and its refusal to hand over the information to the auditor-general.

But Ms Davies defended the Government's decision.

"The auditor-general's opinion was that in 15 of the 16 criteria we were tested on, we made a reasonable decision," she said.

"In 15 out of 16 criteria, we were found to have made a reasonable decision not to release information, because it would significantly impact on the decisions that we've made to secure this contract with Westadium."

She acknowledged the auditor-general had been unable to form an opinion on the 16th matter because he was not permitted to access to the Government's legal advice.

"On the 16th case, he could not form an opinion. That is not the same as saying we made an unreasonable decision," she said.