International Journal of Government Auditing, January 2002, Vol. 29, No. 1

International Journal of Government Auditing January2002 PIb -.---.---.-__--_.--.---.-.--.---.- -. .~..-.-------.-.__ - .-_--__- .- -__ -- International Journal of Government Auditing January 2002-Vol. 29, No. 1 02002 International Journal of Government Auditing, Inc. Board of Editors Franz Fiedler, President, Court of Audit, Austria The InternationalJournal of GovernmentAuditing is published quar- Sheila Fraser, Auditor General, Canada terly (January, April. July, October) in Arabic, English, French, Ger- Mohamed Raouf Najar, Premier President, Cour des Comptes, Tunisia man, and Spanish on behalf of INTOSAI (International Organization David M. Walker, Comptroller General, United States of Supreme Audit Institutions). The Journal, which is the official Clodosbaldo Russian Uzcategui, Comptroller General, .Venezuela organ of INTOSAI, is dedicated to the advancement of government auditing procedures and techniques. Opinions and beliefs expressed President Gloria Jarmon (U.S.A.) are those of editors or individual contributors and do not necessarily reflect the views or policies of the Organization. Editor Donald R. Drach (U.S.A.) The editors invite submissions of articles, special reports, and news items, which should be sent to the editorial offices at U.S. General AssistantEditor Accounting Oflice, Room 7826,441 G Street, NW, Washington, D.C. Linda J. Sellevaag (U.S.A.) 20548, U.S.A. (Phone: 202-512-4707; Facsimile: 202-5 12-4021; E- mail: [email protected]>). AssociateEditors Office of the Auditor General (Canada) Given the Journal’suse as a teaching tool, articles most likely to be Deepak Anurag (ASOSAI-India) accepted are those which deal with pragmatic aspects of public sec- Luseane Sikalu (SPASAI-Tonga) Michael C.G. Paynter (CAROSAI-Trinidad and Tobago) tor auditing. These include case studies, ideas on new audit method- EUROSAI General Secretariat (Spain) ologies or details on audit training programs. Articles that deal pri- Khemais Hosni (Tunisia) marily with theory would not be appropriate. Yadira Espinoza Moreno (Venezuela) INTOSAl General Secretariat (Austria) The Journal is distributed to the heads of all Supreme Audit Institu- U.S. General Accounting Office (U.S.A.) tions throughout the world who participate in the work of INTOSAI. Others may subscribe for US$5 per year. Checks and correspon- Production/Administration dence for all editions should be mailed to the Journal’s administra- Sebrina Chase (U.S.A.) tion office, P.0. Box 50009,Washington, D.C. 20004, U.S.A. Members of the Governing Board of INTOSAI Articles in the Journal are indexed in the Accountants’ Index pub- Jong-Nam Lee, Chairman, Board of Audit and Inspection, Korea, lished by the American Institute of Certified Public Accountants and Chairman included in Management Contents. Selected articles are included in Arpiid Kovacs, President, Allami Szamvevoszdk, Hungary, First Vice- Chairman abstracts published by Anbar Management Services, Wembley, En- Tawfik Ibrahim Tawfik, President, General Auditing Bureau, Saudi gland, and University Microfilms International, Ann Arbor, Michi- Arabia, Second Vice-Chairman gan, U.S.A. Franz Fiedler, President, Rechnungshof, Austria, Secretary General Arah Armstrong, Director of Audit, Audit Department, Antigua and Contents Barbuda - Humberto Guimarbs Souto, Ministro, Presidente do Tribunal de Contas da Unigo, Brazil Leopold A.J. Quedraogo, Inspecteur General d’Etat, Burkino Faso Mohamed Gawdat Ahmed El-Malt, President, Central Auditing 1 Editorial Organization, Egypt Vijay Krishna Shunglu, Comptroller and Auditor General, India 2 XVII INCOSAISeoui Akira Kaneko, President of the Board of Audit, Kaikeikensain, Japan Bjarne Merk Eidem, Auditor General, Riksrevisjonen, Norway Genaro Matute Mejfa, Contralor General, Contraloria General, Peru 20 Fighting Corruption Alfred0 Jose de Sousa, President, Tribunal de Contas, Portugal Pohiva Tui’i’onetoa, Auditor General, Audit Department, Tonga 23 Inside INTOSAI Mohamed ‘Raouf Najar, Premier President, Cour des Comptes, Tunisia Sir John Bourn, Comptroller and Auditor General, National Audit Office, United Kingdom David M. Walker, Comptroller General, General Accounting Office, United States Guillermo Ramirez, President, Tribunal de Cuentas, Uruguay INTOSAI’s motto, “Mutual Experience I3enefitsAl1,” is one that truly describes INTOSAI’s value to its members, and this is never more evident than at INTOSAI’s triennial congresses. The XVII Congress in Seoul demonstrated this motto in action, with 140 SAIs and over 400 delegates participating in the discussions, work groups and committees that give INTOSAI its vitality. “One picture is worth a thousand words,” and so this edition of the Journal, which is dedicated to the XVII Congress, begins with a pictorial editorial that highlights some of the events in Seoul. The SAI that hosts an INTOSAI congress devotes much time, energy and resources to planning and delkvering a successful congress. Pictured here are the many men and women from the Board of Audit and Inspection of Korea whose work and dedication resulted in a successful congress and won the admiration and thanks of all congress participants. The,informal networking that takes place during congresses is a valuable aspect of INTOSAl’s work. Pictured here during a coffee break are Mr. Mohamed Hadhoudi, Morocco; Ms. Esther Stern, the United Nations; and Ms. Inga-britt Ahlenius, Sweden. Among the many professional guides and manuals adopted in Seoul was a practical guide on internal control published by the Internal Control Standards Committee. internal Control: Providing a Foundation for Accountability in Government is available from the INTOSAI web site www.intosai.orq or from the Belgium Court of Audit, committee chair (see page 16). 1 International Journal of Government Auditing-January 2002 Cooperation Produces Results INCO$AI 2001 A record-setting 140 supreme audit institutions gathered strategic planning framework that can guide INTOSAI’s future in Seoul October 2O-27,2001, for INTOSAI’s 17” International in the 21st century. The culminating product of the Congress, Congress of Supreme Audit Institutions (INCOSAI). The the Seoul Accords, was unanimously approved at the closing congress was hosted by the Board of Audit and Inspection of plenary session and contains the conclusions and Korea under the chairmanship of Dr. Jong-Nam Lee. INTOSAI’s recommendations from the discussions on the two Congress motto, “Mutual Experience Benefits All,” is never more evident themes, “The Audit of International and Supranational than during INTOSAI’s triennial congresses, and the active Institutions. by SAIs” and “The Contributions of SAIs in participation of so many SAIs, who were joined by observers Planning and Implementing Administrative and Government from 12 international organizations for a total delegate count Reforms.” of 426, demonstrated the motto in action. Outgoing INTOSAI Chairman and President of the Court of Accounts.of Uruguay, Opening Ceremony Sets Stage and Guillermo Ramirez? noting that INTOSAI’s membership had grown from 34,SAIswhen it v&s founded in 1953 to its current Honors SAIs membership of .184,member states, emphasized this historic The opening ceremony officially inaugurated the ?WII event during.his~address at the opening ceremony when he INCOSAI with a program that included remarks from INTOSAI told participants, “Your presence at this event is the most and Korean government leaders, the presentation of INTOSAPs eloquent evidence of the success achieved by our international highest two awards, and a special welcoming performance by community of government auditing throughout its 4%year life.” a Korean children’s folk ballet company, The Little Angels. Dr?Lee delivers welcoming cfficial ““IY”‘-(I,~,~~~~,~zct**.“,:, c&&g of the XVII INCOSAI: ‘- ,,‘_ ‘+,;.‘i C%tinui&%$-t’one..,.,s.:,,? .:“.“‘.,, < chairman tb an,$~er is shbtin, here./. ( .“<‘..>&“&:.$aaskoutgor.ngI chawman Cyl,lermo Ramirez, host of the 1998 INCOSAI 8mtMontevrck?o ‘-:‘:.:;2<,&$;,:” and chairman of INTOSAI since .that time, talks -tiith:r,ncommg chaimian,Dr. ,Lee of Korea. Joining them, from left to right,’ are Ms. :Lorenzc -arid Mr. Fonseca, officers from the 1998 congress, ,‘and Dr. Song from the 2001 congress. : -._ : .I~. ::!. .The ceremony began with remarks from INT’GSAI’s delegates had adopted a variety of standards, guidelines, and outgoing Chairman, Mr. Guillermo Ramirez, President ofthe methodologies for use by auditors; approved the 3-year work Court of Audit of Uruguay and host of the 1998 INCOSAI. plans for INTOSAI’s eight committees and working group; Mr. Ramirez looked back on the 3 years since the last congress and revised its statutes to increase the size ‘of the Governing and reflected on the “ongoing work between congresses” that Board to 18 members. In addition, the Board established a contributes to INTOSAI’s effectiveness and usefulness to its Strategic Planning Task Force charged with developing a members. He noted the support provided by the General 2 International Journal of Government Auditing-January 2002 Secretariat in Vienna, the research and training conducted by Canada and Iceltid Win Kandutsch and Staats INTOSAI’s seven regional working groups, and the great Awards contributions made by the eight committees and working For the seventh time in its 48-year history, INTOSAI groups. He also cited two particular activities that, “due to the importance of their purpose and results achieved, deserve our presented two awards in Seoul, one to recognize outstanding special

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