Bangladesh
The Office of the Comptroller and Auditor General of Bangladesh organised a workshop on ‘Audit Awareness’ on October 26, 2005 at the Pan Pacific Sonargaon Hotel, Dhaka in association with the DFID-Royal Netherlands government funded financial Management Reform Programme (FMRP). Secretaries, Additional Secretaries, Joint Secretaries and senior officials participated in the deliberations of the workshop.
The concept of entity audit with vertical audit trails leading to certification and system audit were explained. The audit dimension was linked with the new initiative in public expenditure management in Bangladesh called Medium Term Budgetary Framework (MTBF) – a multi- year approach to budgeting that provides a medium term framework for government receipts and expenditure. MTBF incorporates
Multi year approach covering a period of 5 years
A framework for revenue receipts and both non-development and development expenditure
Estimated budget for the ensuing financial year and the projections for two
Accommodated estimates/projections within the expenditure ceiling
Rolling forward of the previous estimates by one year and the addition of a new year
These are aimed at enhancing the efficiency and accountability of resource utilization by linking resource allocation to performance criteria through MTBF framework where the role of audit will be vital. The government has published an Internal control Manual (ICM) and a Public Expenditure Manual (PEM) to ensure value for money and improved governance in resource allocation.
During discussions on ‘Changing Audit Environment’ mention was made of entity wise audit as a first step in performance auditing by reviewing management decisions, evaluating the results of the total operations of the Ministry and allowing the CAG to comment on the performance of the Ministry on the basis of the macro indicators. Discussions on ‘Auditor-Auditee Relationship’ emphasized on involving the auditee during audit planning, field audit and reporting to assess the quality of audit reports.
A paper was presented on ‘Reporting to Parliament’ with a thrust on the following
Production of objective and quality audit report by CAG for effective dispensation by the Parliament
Accurate and transparent certification of Finance Accounts and Appropriation Accounts by CAG
Close co-operation between the Public Accounts Committee and CAG for Quick disposal of audit objections, Clearing the backlogs of unsettled audit objections, Focusing on important policy and management issues, and Following up the implementation of PAC’s decisions by the executive
Positive role of audit in ensuring economic growth was emphasised, with a stress upon preparing field-tested performance audit, environmental audit and special audit guidelines to enable auditors follow a standardized auditing format.
India
SAI-India
SAI-India has been organising International Training Programmes since 1979 and has contributed to professional capacity building in SAIs all over the world. In this effort the Comptroller and Auditor General has been getting full cooperation of the Government of India So far 72 International Training Programmes have been organised. The fifth and the last programme of the financial year 2005-06 on “Auditing in EDP Environment-Challenges for SAIs” was held from February 27 to March 28, 2006. Thirty-nine Participants from 27 SAIs attended this International Training Programme
Participants of the 72nd International Training Programme on “Auditing in EDP Environment-Challenges for SAIs”
In the year 2005-06 the international participants from all over the world attended five such programmes. The programmes for the year 2006-07 are as follows:
|
# |
Name of course |
Period |
|
1 |
Audit of Public Enterprises & Disinvestment Issues |
August 7 to September 6, 2006 |
|
2 |
Audit in IT Environment |
September 18 to October 17, 2006 |
|
3. |
Performance Audit |
November 20 to December 19, 2006 |
|
4. |
Environment Audit |
January 8 to February 07,2007 |
|
5 |
Audit of Energy Sector |
February 26 to March 27, 2007 |
-SAI-Japan
Strengthening the Audit Capability of Members of the Asian Organization of Supreme Audit Institutions
ASOSAI launched a new project to enhance audit capabilities of newly established SAIs with the following outline.
1) Objectives:
The primary goal of the project is to improve audit capabilities for newly established SAIs (the targeted SAIs) in ASOSAI through hands-on workshops and upgrade training capacity for ASOSAI including its member SAIs.
2) Target SAIs:
The targeted SAIs in this project are grouped by geographical location and language to be used as medium of instruction: (i) East and Central Asia – Azerbaijan, Kazakhstan, Kyrgyz and Mongolia (Group 1); and (ii) Mekong and South Asia – Afghanistan, Cambodia, Laos, Maldives, Myanmar, and Vietnam (Group 2).
3) Duration:
From August 2005 to July 2008
4) Activities:
The project comprises of a one week planning meeting, two 2-3 week Capacity Building Needs Surveys for each Group, and based on the survey results, two Pre-Workshop Instructors’ Meetings for two weeks each, and a total of four workshops for 2.5 weeks each. All of the activities will be engaged in by a team of selected Training Specialists created in the first and second Long Term Regional Training Programs (LTRTPs).
5) Financial Assistance:
US$ 650,000: the Asian Development Bank (Japan Special Fund) US$ 350,000: the INTOSAI Development Initiative
-SAI-Pakistan
Auditor General of Pakistan held a five-week training program in Performance Auditing (62nd International – ITP) in Lahore from January 17 through February 18, 2006. The program was participated by twenty three (23) middle managers from the SAIs of Saudi Arabia, Sri Lanka, Oman, Turkey, Botswana, Nepal, Iraq, Qatar, Zambia and Pakistan. The program was to impart the concepts, tools, techniques and methods of performance auditing enabling the participants of the program to evaluate the performance of development projects/programs and, to produce quality performance audit reports, independently. The whole program was divided into four phases and each phase into the subject-wise lectures, exercises, and case studies. Participants also visited various cultural and historical programs and places during their stay at Lahore and Islamabad.
-SAI-Philippines
Notwithstanding all the sophistication of computer-based monitoring systems and the other elaborate, and complex methods or even state-of-the-art technology in which a crime can be uncovered, there is simply no alternative for the perceptiveness and acuity of the human mind when it comes to spotting the patterns that invariably underlie the commission of a crime, more particularly, the commission of fraud for that matter-that unique configuration of events, strange incidents, and unlikely coincidences that signal the presence of wrongdoing.
In fact, our experience apparently make us aware that such crimes-whatever their particular form-exhibit quite specific, and identifiable, characteristics. Investigative data or information – which can include computer files, records, changes in the subject’s lifestyle, to name but a few sources of intelligence-invariably reveal clues that only a properly trained, and perceptive fraud investigator can discern.
To address this concern and keeping with its end of enhancing public accountability and significantly with the unsolicited financial and expert assistance and coordination provided by the Untied States agency for International Development (USDAID) under its project, rule of Law Effectiveness (ROLE), the Philippines’ Commission on audit conducted a seminar on Advanced Fraud Investigation for Trainers from October 24-28, 2005 at the Commission’s Professional Development Center Building.
Discussed in the seminar-workshop includes among other things; Anti-Money Laundering and Fraud Audit, Best Practices in Financial/Fraud Investigation, Developing a Fraud Case and Evaluation of evidence from Fraud Investigation; all geared towards improving COA Fraud Audit reports. It emphasized that successful fraud investigation requires more than gathering and collation of various sources of circumstantial evidence into a solid, coherent structure that either proves or disproves the existence of the fraud.
The seminar also focused on the types of fraud, documents, sources of evidence, and analysis of internal and external fraud schemes pointing out the skills needed to identify and investigate fraud. An open forum with a panel of experts ensured on the last day of the workshop.
COA is well aware of the fact that while it is true that fraudulent acts exhibit certain universal characteristics and display common “footprints”, every agency or government instrumentality is different and requires its own special set of tailor-made solutions to the ever-growing problem of crime involving the bureaucracy.
The training was participated in by fifty-three lawyers: forty-one of which are lawyers of the Commission; eight from the Office of the Ombudsman (OMB); two from the Department of Finance (DOF); and, two from the Presidential Anti-Graft Commission (PAGC).
SAI-Australia
Better Practice Guide Public Sector Audit Committees
In February this year the Australian National Audit Office (ANAO) published its Better Practice Guide (Guide) on Public Sector Audit Committees. The Guide updates and replaces the Guide the ANAO issued in 1997 and is directed at Australian Government public sector entities.
Over recent years, a series of corporate mishaps and collapses, both in Australia and internationally, has heightened attention on the importance of good governance for investor and consumer confidence. The changing environment has significant consequences for public sector auditors, given the increased emphasis on establishing and demonstrating sound control systems, sound risk management, and on achieving a suitable balance between conformance and performance requirements.
An Audit Committee plays a pivotal role in the governance framework of organisations in both the public and private sectors. Recent and emerging developments in both sectors are pointing to an increase in the importance of the role and the modus operandi of Audit Committees, including the degree of reliance Chief Executives and boards are placing on committees to provide them with independent assurance and assistance in the areas of risk, control, compliance and financial reporting in particular.
The Guide recognises that there is no one model audit committee that all entities should adopt. Rather, as all public sector entities are different and each has its own particular governance framework, risk and control structures and supporting policies and processes, the precise role each Audit Committee plays should be determined within the context of each entity’s particular governance framework.
The ANAO Guide is intended as a reference document for Chief Executives, Boards, members of Audit Committees and people with specific Audit Committee reporting responsibilities and accountabilities.
The Guide is structured around the six key characteristics of a better practice Audit Committee in the Australian Government public sector:
a good understanding of the Audit Committee’s position in the legal and governance framework;
clearly defined roles and responsibilities;
members with relevant personal qualities, skills and experience;
the ability to maintain effective relationships with key stakeholders;
the ability and capacity to conduct its affairs efficiently and effectively; and
a robust and considered process of performance assessment.
The first part of the guide outlines better practice principles and practices, including relevant considerations in establishing and operating a better practice public sector Audit Committee. The second provides model charters for different types of organisations in the Australian Government sector and the third provides aides-mémoire, checklists and other material that Audit Committees should tailor and use to assist in implementing better practice principles and supporting processes.
All ANAO Publications can be found on:
www.anao.gov.au
Here is the weblink for this document:
http://www.anao.gov.au/WebSite.nsf/1c8fb55046f2cc5cca256bed00179e7f/db82bd972f2a30aaca256faf00159722!OpenDocument
-SAI-Australia
The SAP (SAP is an integrated software solution, developed in Germany, that provides support for a wide range of business functions, including both financial and human resource management.) application is the most prevalent financial management information system used by Australian Federal Government entities. Some 17 of the major departments have implemented this system. Understanding and gaining assurance/reliance over the internal control environment surrounding SAP is therefore critical for financial statement and reporting purposes.
It can be difficult and costly to continuously monitor the effectiveness of a SAP internal control environment. A lack of focus on internal controls during implementation and the effort and cost required to perform continuous monitoring, can limit the ability to obtain assurance over the control environment.
Utilisation of technology could provide the opportunity to gain audit assurance in a more efficient and/or effective manner. In the latter part of 2004, the ANAO identified a set of new SAP audit and assurance tools, called Assure, that could greatly assist and enhance audit efforts within SAP environments. The tools offered the promise of automating the monitoring and assessment of the SAP internal control environment. The tools also claimed to automatically identify recommendations to correct security and control weaknesses.
The ANAO undertook a desktop evaluation of the tools and then subsequently ran a pilot installation on a major government department in order to assess the potential of the tools to meet audit needs. The results of these assessments indicated use of the tools would deliver significant benefits to the audit efforts of the ANAO. The tools were purchased in December 2004 and have now been implemented across some 15 government entities.
The tools comprise three modules: Assure Control, Assure Security and Assure Integrity.
The Controls module provides monitoring of SAP configuration controls through assessing internal controls against a best practice book of controls, and automatically identifying and reporting internal control weaknesses. The module can also provide notification of changes to internal controls.
The Security module enables the adequacy of security access to be monitored by identifying users that have access to sensitive and incompatible functions and providing automatic notification when access rights change.
The Integrity module assists in the identification of integrity risks and fraud through identification of potential fraudulent transactions, inappropriate use of privileged user access, duplicate transactions and integrity problems with master data.
The benefits of using the Assure tools have been, and are continuing to be achieved. The ANAO intends to continue use of the tools on future audits. The benefits achieved to date include:
Reduced effort and cost;
Increased knowledgebase of SAP controls;
Continuous monitoring of key SAP controls;
Greater coverage of SAP transactions;
Reduced substantive testing; and
Focus on 100% of the transaction population.
A number of the departments where the ANAO has run the tools have also seen the benefits from their use and have subsequently purchased the tools to enable their own internal monitoring of SAP controls.