Back

Appendix - ‘A’
Key Elements of the SAI’s Audit Quality Management Framework*

* Adapted from VFM Quality Framework and Annual Audit Quality Management System of OAG Canada.

Quality Management Element

This element should provide assurance that:

Key Instruments employed

Leadership and Direction
1. Tone at the top	SAI has appropriate tone-at-the-top policies for SAI top management to ensure that the leadership SAI receives is consistent with the highest professional standards, SAI core values and its vision and mission.	Strategic Plan of the SAI Annual Activity/Performance Report Audit Advisory Board Auditing Standards of the SAI
2. Vision, Mission, Core Values and Auditing Standards	SAI has its own vision, mission and core values and auditing standards, which conform to the audit quality management system.	Vision, Mission Statement and core values Strategic Plan INTOSAI Auditing Standards SAI Auditing Standards
3. Strategic Direction and Planning	The Strategic Plan prescribes the broad contours for medium term progress of the organisation and should help in establishing goals and delineating ownership & responsibility. The plan also incorporates the vision, mission and the core values of the SAI with the objective to improve the quality and impact of audit, to promote excellence in audit and for overall improvement in the quality of governance.	Strategic Planning exercise: vision, mission, values, including SAI top management’s focus areas.
4. Strategic Audit Planning	SAI should have in place strategic audit plans defining the goals and objectives to be achieved through audit and the strategic measures to attain them.	Strategic Audit Plans of the SAI
5. Portfolio and Risk Management	The SAI undertakes work that is within its jurisdiction and authority to audit and that it efficiently and effectively manages the risks involved in performing the audit assignment. While planning for audit, SAI has considered all deserving and significant programmes/entities which are vulnerable to risks and /or are seen as important and relevant for review by legislature, the departments and the public.	Act governing audit Other legislation Strategic Plan of the SAI Strategic Audit Plan for performance and financial audits Client survey results Request by Stakeholders

Human Resource Management

1. Resourcing & Recruitment	Audit teams possess the required qualifications, collective knowledge of the subject matter, competencies and the auditing proficiency to enable them to carry out the audits and fulfill the audit mandate.	Auditing Standards relating to resources and recruitment - Human Resources rules, policies and guidance Specific requirements for resourcing & recruitment in the audit manual on performance and regularity auditing (financial and compliance), audit policies and guidance,
2. Training and Capacity Building	The audit teams designated to carry out the work have adequate technical training and proficiency	SAI Auditing Standards relating to Training Training Plan of the SAI Human Resources policies and guidelines Training policies and guidelines
3. Performance Management and Appraisal	The staff members receive timely and constructive feedback on their performance and have access to counselling and guidance to manage and develop their careers. Personnel selected for advancement i.e. those who are promoted are competent and fully qualified to fulfill the responsibilities that they will be called upon to assume. Personnel undertake professional development through such means as on-the-job training, self-directed studies, internal and external assignments An evolving learning curricula and development opportunities are maintained for the personal growth in knowledge and experience of the audit staff Personnel welfare and benefit measures are in place in the organisation to motivate the staff to give their best	Performance Appraisal System Human Resources Policies and Guidance Counselling, guidance and monitoring processes Professional development through such means as on-the-job training, self-directed studies, internal and external assignments
4. Personnel Welfare and Benefits		Personnel Welfare Policies

Audit Performance

1. Audit Planning	The work is adequately planned and the audit issues are selected on the basis of risk, their relevance to the SAI’s mandate, significance and auditability. Criteria that are suitable for evaluating the subject matter are identified and developed	Performance Audit Manual Financial Audit Manual Audit Policy instructions and guidance Software support tools.
2. Staffing for the Audit	Adequate staffing is provided for audit to be conducted efficiently and effectively	Audit Manuals and Staffing Manuals Rules and Regulations governing service, policy instructions Manning schedules Reshuffle/reassignment policies
3. IT Tools	Appropriate IT tools are available in the SAI as a measure of audit quality improvement	Software support tools
4. Other tools and guidance	Appropriate guidance and audit tools and techniques are in place, useful and applied consistently	Office intranet site Best Practice Guides Audit policy instructions and guidelines
5. Conducting the Audit	All Audits are conducted with due regard for efficiency and economy in terms of time spent and resources utilized and in accordance with the legal mandate, policies and practices of the SAI. The audit teams deliver the audit in time, in accordance with the SAI’s principles and policies and audit costs are justified.	Performance Audit Manual Regularity (Compliance and Financial) Audit Manual Approved Audit Plans – approved budget and human resources Progress Reports Electronic Tools Sampling guides
6. Consultation and advice	Consultation is sought from experts and specialists with appropriate competence, skill, knowledge, judgment and authority to ensure due care and authoritative opinion when dealing with unusual, unfamiliar and complex issues.	Auditing Standards Performance and Financial Audit Manuals Audit Policies, procedures and guidelines Subject matter experts, to provide advice and support Audit Forum
7. Supervision and review	Personnel working in the audit team receive an appropriate level of leadership and direction so that they are encouraged to perform to their potential and to ensure that audits are properly carried out. Adequate supervision of all audit personnel is provided so as to ensure that audits are properly carried out. All audit work is reviewed by a senior member of the audit staff before the audit opinions or reports are finalized so as to bring more than one level of experience and judgment to the audit task and to ensure that all evaluations and conclusions are soundly based and are supported by competent, relevant and reasonable audit evidence as the foundation for the final audit opinion or report.	Auditing Standards Financial and Performance audit manuals Audit office policies, procedures and guidelines Human Resources policies and guidance
8. Evidence	Sufficient, appropriate, competent and relevant evidence is obtained to provide a reasonable basis to support the conclusion expressed in the report	Auditing Standards Financial and Performance audit manuals Audit office policies, procedures and guidelines Confirmation of findings resulting from field work with the audited entities Review by senior management of SAI of some important reports and conclusions and their rationale Quality Assurance Review
9. Documentation	The system of documentation in the SAI is designed to ensure that all the audit processes are duly recorded and available both for subsequent follow-up as well as for future audits.	Auditing Standards Audit Manuals – Financial and Performance Audit policies, procedures and guidelines Quality assurance review
10. Reporting and follow-up	The audit report is relevant, coherent and written in plain and easily understandable language for the readers. There is effective review of all findings, conclusions and recommendations before finalization.	Auditing Standards Financial and Performance Audit Manuals Review and quality assurance before issue of the report Post-audit quality assurance review Follow-up/monitoring of audit recommendations

Client and Stakeholder Relations

1. Communicating audit messages	Post-tabling audit messages are communicated clearly and consistently	Office policies and instructions on this issue Guidance on press releases and response to media enquiries
2. Feedback from clients and stakeholders	Clients and stakeholders perceive information and audit processes as useful	Tracking of SAI recommendations taken up by the legislature Analysis of external communications (media, public enquiries, references in debate) Survey of the legislators and government officials on the audit reports and whether they have perceived them as useful
3. Relationship between legislative committees and SAI	Effective and productive relationship exists between PAC and the SAI as regards consideration of the audit reports by the PAC. The examinations by the legislative Committees are intended to focus public attention on the audit findings and to point to the directions in which corrective action lies at present and where care is needed	PAC discussions of the audit reports PAC reports – recommendations of the PAC SAI’s analysis of the scrutiny of the report by PAC

Continuous improvement

1. Internal Audit	An effective internal audit system exists in the SAI to assist the audit organisation to achieve effective management of its operations, sustain the quality of its performance & ensure compliance with internal control policies and procedures with the SAI.	Auditing Standards Internal audit manual, policies and guidelines Action taken within the SAI on the internal audit reports
2. Internal quality assurance review	An effective internal quality assurance review mechanism exists to provide feedback on the effectiveness of the individual engagements for financial and performance audits as to whether they are performed in terms of applicable standards, policies and guidance and meet expected quality requirements.	Auditing Standards Internal quality assurance manual, policies and guidelines Action taken within the SAI on the internal quality assurance review reports
3. Peer Review	There is an institutional mechanism for periodical peer review of SAI’s quality assurance system.	Peer review reports SAI’s policy and programme on peer review of the audit practices Action taken on the Peer Review Report
4. Lessons learned	Audit experience is assessed and opportunities for improvement are identified and implemented	Lessons learned philosophy Survey instruments