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Training Profile-Papua New Guinea

(A Detailed Description of Localisation And Staff Development Programmes of The Auditor-General's Office of Papua New Guinea)

By M. Geno, Auditor-General

1.    Introduction

papua New Guinea attained independence in 1975. Prior to that the country was administered by Australia. The Office of the Auditor-General of Papua New Guinea was established on 1st December 1973 and an officer of the Commonwealth Auditor-General's Office was appointed as the first Auditor-General. Prior to that time the audit of the Administration of Papua New Guinea was carried out by the Auditor-General of Australia, through a resident branch located in Port Moresby. In 1983 the first national Auditor-General was appointed under the Constitution of the Independent State of Papua New Guinea.

Papua New Guinea is desperately short of experienced and trained accounting and financial management personnel at both the professional and sub-professional levels. At the professional level both the Government and private sector are overly dependent on the services of expatriate accountants and financial managers. It appears that this will be the case for many years. Education Institutions are presently unable to supply an adequate number of accounting personnel at either the professional or the sub-professional level.

2.    'Strategic Plan' for Staff Development and Training

The Auditor-General is required under the provisions of the Constitution to inspect, audit and report at least once in every fiscal year to the National Parliament on the Public Accounts of Papua New Guinea, and on the control of, and on transactions with or concerning the public moneys of Papua New Guinea. To fulfil these responsibilities, proficient auditors are required. Due to the lack of national auditors a high proportion of senior positions are occupied by contract officers. An independent country should develop its own resources to manage its affairs. It cannot be dependent on overseas expertise all the time.

The Universities and other education Institutions do not cater for the training of auditors as a specialist discipline. The only way to develop auditing skills is by post graduate exposure to in-house auditing concepts, techniques and methodologies.

In recognition of this fact, a training programme has been developed, which blends theoretical concepts with practice. The details of this programme are given below. By giving details of our programmes, I am hoping to hear from other institutions, specially in the third world counties, about their training programmes and also would like to solicit valuable suggestions to improve our existing programme.

2.1    The Objectives of the "Strategic Plan"

1. To localise senior and middle management positions within the Auditor-General's Office within five to seven years;
2. To develop a Training Programme in auditing and accounting to give the National Officers a sound theoretical and on the job training;
3. To develop a career path for National Audit Officers with a view to retain and motivate them; and
4. To identify among the national officers those who are suitable to occupy the senior and middle management positions in the Office and eventually appoint them to these positions.

2.2    Implementation Strategies

The programme of training takes into account the need to train the officers in the performance of the functions of the three main divisions of the Office, namely, the National Government Division, the Provincial Government Division and the Commercial Division.

In addition, they are to be exposed to working in a private sector environment by attaching them to an Auditing or Commercial firm. The Training Programme has been designed to cater for two groups of officers- New Graduate Trainees and non-graduate Officers already in service with the Office. The key features of the two training programmes are outlined below:

In-house training which includes theoretical training in Introductory and Advanced Auditing courses coupled with rotation of officers by placing them from time to time to the three main divisions of the Office.

On the job training by placing the trainee as an Audit Supervisor in charge of an audit team, progress being monitored by the Senior Audit Inspector.

Attachment to an auditing Firm or a Commercial Organisation for one year in order to gain a first-hand knowledge of private sector auditing.

Theoretical training in Management by enrolling the trainees in Management courses conducted by the Administrative College; participation in Seminars and exposure to international conferences like those organised by the ASOSAI and the INTOSAI, coupled with on the job training as Regional Managers.

Attachment to a Senior Audit Inspector as an understudy. Assistance being given to acquire professional qualifications.

Appointment as Senior Audit Inspector.

1. Graduate Officers: To be attached to an auditing or commercial firm for one year and to be exposed to international seminars. They are to be considered along with the new graduate trainees for localisation purposes.
2. Under-Graduate Officers: To be given assistance to complete their tertiary education; and/or overseas training. Successful officers are to be considered for localisation purposes.

This plan was drawn up with the approval of the Public Services Commission and was implemented commencing 1984.

3.    RESTRUCTURE OF THE AUDITOR-GENERAL'S OFFICE

Action was initiated in late 1983 to reorganise the Office structure so as to complement the localisation programme by increasing proportionately the national positions in the Office. The restructure proposal was approved by the Public Services Commission and was fully implemented in 1985. Resulting from the restructure the funded positions increased as follows:-

*    Due to reduction in manpower ceilings.

In order to professionalise the national positions, the base recruitment level qualification was raised to Graduates in Accountancy/Commerce/Economics. Earlier the base level qualification was Grade 12.

4.    Other Staff Development Programmes

As part of the professional development programmes Officers are sponsored to overseas courses.

(a)    Canadian International Development Agency- Fellowship Programme

 The main objective of this fellowship is to train auditors in the theoretical and practical aspects of value for money auditing.

(b)    Graduate Training Programme-Commonwealth Auditor-General's Office, Australia

The objectives of this programme are:-

1. to develop a practical understanding of auditing standards and techniques;
2. to train officers to understand, appreciate and perform system based audits; and
3. to develop an awareness of internal controls in computer environment.

(c)    Financial Management Course

The objectives of this course are:-

1. to introduce current thinking in public sector financial management;
2. to provide instruction and practice in modern budgetary techniques;
3. to develop a framework for managerial accounting and decision making; and
4. to explore the role of financial planning in the economic development process.

(d)    Officers are nominated to attend international seminars sponsored by the Asian Organisation of Supreme Audit Institutions and the International Organisation of Supreme Audit Institutions.

The objective of these seminars is to interchange ideas and to study audit practises of other countries.

4.2    Tertiary Studies

The Office has been for several years sponsoring National Officers to part time tertiary studies, with a view to enhancing their knowledge of accounting and auditing.

However, it is now being increasingly felt that the sponsorship to part-time tertiary studies- has certain distinct disadvantages which has affected the performance of officers both in their studies and office work. The disadvantages are-

1. New Audit Trainees have to work for two years before being sponsored for tertiary studies in accordance with the Public Services Commission rules which permit only permanent officers to be sponsored. As a result, these new Audit Trainees who are eligible to follow the University courses are effectively debarred from doing so until they are made permanent and consequently lose two valuable years to complete their studies.
2. It has been found that it takes a minimum of eight years to complete a part-time degree course in accountancy and consequently ten years for an Audit Trainee to obtain a degree in accountancy. The time span is not conducive to staff development.
3. Working in the Office under strict time schedules and continuing part-time studies for a prolonged period of eight years imposes a heavy burden on the Audit Trainees.
4. This Office has to perform certain audits within the times specified and it often finds that part-time tertiary studies of officers interfere with the programme of work and casts additional burden on other staff.

The Office in order to overcome these difficulties drafted a new training programme for the non-graduate national staff. This called for a full time release under a free place scholarship grant by the Public Services Commission coupled with in-house training on completion of their tertiary studies.

It is hoped that the new arrangement would help the Officers to pursue their studies and at the same time maintain the normal operations of this Office.

Presently, the policy of the office is to sponsor officers to tertiary institutions on a full time basis.

Internal training in this Office has been centered around four specific areas:

4.3.1    Formal classroom type courses: This is geared to impart-

1. the legal framework within which this Office's audit functions are carried out;
2. the Government Accounting System;
3. the Organisation that implements the accounting system; and
4. the procedures and forms that are used to implement the system.

These matters form the core content of the Introductory Auditing Course. The Advanced Accounting Course is the other classroom type course conducted for officers with two to five years experience with a view to emphasise the professional aspects of the audit functions such as ethical standards, auditing standards, approach to audit and report writing.

The courses are also made available to Internal Auditors of National Government Departments, Provincial Governments and Statutory Bodies.

The graduate recruits are placed with the operation divisions where they are attached to an audit team to perform audit operations. The Team Leader as well as the Senior Audit Inspector of the division are expected to brief the new recruits, on the audit objectives, audit approach, collection of evidence and formulation of opinion on the basis of evidence.

The attachment to Finance is to observe at first-hand the operation of the three important divisions of that department namely, the Budget, the Accounting and the Finance Cashier's Branch. The attachment to private Auditing Firms is to expose them to private sector auditing environment.

Internal group discussion is one of the forums through which training of National staff is being promoted. Essentially, the discussions are on matters relating to actual performance discussed in an informal atmosphere. All three operational divisions are actively engaged in group discussions.

5.    TRAINING FOR PROFESSIONAL EXAMINATIONS OF THE (PNG) ASSOCIATION OF ACCOUNTANTS

Accountancy graduates have to have practical training for at least two years and have to successfully complete the examinations of the Papua New Guinea Association of Accountants (PNGAA) before being admitted as an Associate Member of the PNGAA.

Training classes are" held in-house for all eligible national officers.

6.    PUBLICATIONS

The Office commenced publishing a quarterly journal known as the Audit Bulletin in 1978. The objective of the Bulletin is to communicate ideas and practical information to all officers in the Department with a view to inter-relate work to the growing body of knowledge, events and problems which surround the day to day working environment. The journal is increasingly sought

out by students of auditing and consequently is now being distributed to the Administrative College, the University of Papua New Guinea and the University of Technology in addition to the Internal audit section of all Government Departments.

The Office also publishes a monthly newsletter ior its staff which carries not only information relating to staff positions, promotions, recruitment, etc. but also important Financial Circulars, PSC Circulars, Staff Advices and other news of a similar nature.

7.    THE NEED FOR PROFESSIONALLY QUALIFIED NATIONAL AUDITORS

Under the constitution and other Acts, the Auditor-General is required to audit and report on all:-

• Statutory Bodies and their subsidiaries
• Provincial Governments
• Public Accounts of the National Government
• Statement of Accounts on projects funded by International Agencies.
• National Government Departments.

In addition the Auditor-General is required by cabinet decision to audit and report on Companies registered under the Companies Ordinance, in which the Government has a majority equity holding.

These audits have to be performed in accordance with International Accounting and Auditing Standards.

Generally accepted auditing standards require, inter alia, that-

• the examination is to be performed by a person or persons having adequate technical training and proficiency as an auditor
• the work is to be adequately planned and assistants, if any, are to be properly supervised
• the report should state whether the financial statements are presented in accordance with generally accepted accounting principles.

In performing these constitutional functions the Auditor General, therefore, has to have a staff who are professionally trained and proficient as an auditor.

These skills take time to master and graduates in accountancy and commerce have to have adequate training and develop the required proficiency before they could function independently.

8.    Progress of Implementing Strategic Plan

The plan became fully operative in 1985 and within the two years of its operation, the plan has been successfully implemented.

Operating positions held by National Officers in 1983 and in 1986 (September) are given below to substantiate the above claim-

All Administrative positions are held by National Officers.

The plan envisages a period of 5-7 years. The Office is confident that the target can be met.