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International Journal of Government Auditing, April 1994, Vol. 21, No. 2

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International Journal of Government Auditing, April 1994, Vol. 21, No. 2 Iillill Iill I!111 Ij II IllI II !!I1 II! 153063 April 199”Vol. 21, No. 2 01994 Intemutional Journd of Government Auditing, Inc. Board of Editors TheInternationalJourndofGovernmentAuditing ispublishedquar- Franz Fiedler. President, Court of Audit, Austria terly (January, April, July, October) in Arabic, English, French, L. Denis Desautels, Auditor General, Canada German, and Spanish editions on behalf of INTOSAI (International Dali Jazi, Premier President, Court of Accounts, Tunisia Organization of Supreme Audit Institutions). The Journal, which is Charles A. Bowsher, Comptroller General, United States the official organ of INTOSAI, is dedicated to the advancement of Jose Ramon Medma, Comptroller General, Venezuela government auditing procedures and techniques. Opinions and beliefs expressed are thoseof editors or individual contributors and do President, IJGA, Inc. not necessarily reflect the views or policies of the Organization. Peter V. Aliferis (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 Editor AccountingOffice.Room7806,441GStreet,NW,Washington,D.C. 20548. U.S.A. (Phone: 202-512-4707. Facsimile: 202-512-4021). Donald R. Drach (U.S.A.) Given the Journal’s use as a teaching tool, articles most likely to be accepted are those which deal with pragmatic aspects of public sector Assistant Editor auditing. These include case studies, ideas on new audit methodolo- Linda L. Weeks (U.S.A.) gies or details on audit training programs. Articles thatdeal primarily with theory would not be appropriate. Associate Editors The Journul is distributed to the heads of all Supreme Audit Jnstitu- Hubert Weber (INTOSAI- Austria) tions throughout the world who participate in the work of INTOSAJ. Mark Hill (Canada) OthersmaysubscribeforUS$5peryear. Checks andcorrespondence Axe1 Nawrath (Federal Republic of Germany) for all editions should be mailed to the Journuls administration Hisashi Okada (ASOSAJ-Japan) office-P.O. Box 50009. Washington, D.C. 20004, U.S.A. Luseane Sikalu (SPASAI-Tonga) Articles in the Journal are. indexed in the Accountants’ Index Sharma Ottley (CAROSAI-Trinidad and Tobago) published by the American Institute of Certified Public Accountants Abderrazak Smaoui (Tunisia) and included in Management Contents. Selected articles arc in- Diane Reinke (U.S.A.) cluded in abstracts published by Anbar Management Services, Susana Gimon de Nevett (Venezuela) Wembley, England, and University Microfilms International, Ann Arbor, Michigan, U.S.A. Production/Administration SebrinaChase (U.S.A.) Members of the Governing Board of INTOSAI Contents Charles A. Bowsher. Comptroller General, United States, Chairman Fakhry Abbas. President, Central Auditing Organization, Egypt, Fit Vice-Chairman Elvia Lordello Caste110Branco, Ministro-Presidente, Court of Accounts, Brazil, Second Vice-Chairman 1 Editorial John C. Taylor, Auditor General, Australia Franz Fiedler, President of the Court of Audit, Republic of Austria, 2 News in Brief Secretary General E. David Griffith, Auditor General, Barbados 7 SPASAI Paul Ella Menye, Coordinator General, Cameroon 10 Auditing Project Sustainability L. Denis Desautels. Auditor General, Canada Tapio Leskinen, Auditor General, Finland 13 Selecting Audit Topics Hedda Czasche-Meseke, President, Court of Audit, Federal Republic of Germany 16 International Auditing Symposium J. B. Sumarlin. Chairman, Supreme Audit Board, Indonesia 17 Audit Profile-Republic of Poland David G. Njoroge, Controller and Auditor General, Kenya Javier Castillo Ayala, Contador Mayor de Hacienda, Mexico 19 Reports in Print Pascasio S. Banaria, Chairman of the Commission on Audit, Republic of the Philippines 20 Inside INTOSAI Ioan Bogan, President, Court of Audit, Romania Omar A. Fakieh, State Minister and President, General Audit Bureau, Saudi Arabia Pohiva Tui’i’onetoa, Auditor General, Tonga By S. A. Goolsarran, Auditor General, Guyana September1,1993 was a special day for the Office of the Auditor General (OAG) of Guyana. On that day-after a 10 year absenceof government financial reporting-the OAG issuedits report on Guyana’s public accountsfor 1992.For the first time since 1957, the annual audit had been completed within the statutory deadline. Our report noted many serious problems with the accounts and with governmental financial management generally. Nonetheless, this achievement of producing audited public accounts in a timely manner indeed brings back some semblance of effective accountability to Guyana. Reaching this important milestone was a tremendous challenge that required intensive efforts not only internally at S. A. Goolsarran the OAG but externally with governmentas well. Throughout this effort, the IhrTOSAI network-and by that I mean the controlling interest is vested in the state. We also used the organization’sinternationally acceptedaudit andinternal control media to inform the public about theseevents and issues.And standards, congress recommendations, training programs, finally, the OAG vigorously pressedfor appropriate discipli- cooperativeprojects with other supremeaudit institutions, and nary action against proven malefactors. other professional activitieewas a valuable resourceto us. Concurrently, we focused efforts inward to see how our When I was appointed Auditor General in 1990, govem- own organization could be improved to meetthesechallenges. ment facedenormous public accountability problems,includ- During the last 3 years,the OAG itself had to be revitalized and ing the absenceof qualified personnel, outdatedand cumber- improved, and a major improvement program was begun. In someaccounting and information systems,poor internal con- the human resources area, we introduced a 3-year internal trols, and a culture of lack of accountability. We immediately training program for new entrants to the OAG, and we revised beganto revive the accountability processand to reintroduce job descriptions and salary scales(due recognition was given financial control and sound managementto Guyana’s public to performanceand higher levels of training). We also partici- service. We began working closely with government to iden- pated in INTOSAI training (IDI) as well as training programs tify key issues,and we took a number of specific actions. offered by sister SAIs. First, the Ministry of Finance was apprised of the OAG’s The OAG adopted INTOSAI’s auditing standards,and viewsof the stateof affairs, and recommendationswere made drafted our own standards to complement them. We also (e.g., closing all overdrawn bank accounts, setting up a task introduced effective planning and review functions to our force to put togetherthe backloggedaccounts, etc.) At the same work, and set up proceduresto contract out the audits of over time, special reports identifying the most severe problems 20 public corporations. In addition, we obtained UNDP/IDB were issuedto the National Assembly. We also helped reacti- funding for a program to develop and improve the efficiency vate the Public Accounts Committee, which had not reported of the OAG; this included the servicesof an advisor from the publicly in Guyana for over 20 years. UK National Audit Office. Furthermore, we have drafted a new audit law making the OAG functionally andoperationally Accounting officers werereminded of their statutory obli- fully independent. gations,and all of them were given detailedreports of the major deficiencies in their ministries and departments. We also Again, the professional support available through INTO- provided assistanceto them in preparing and presenting their SAI and its memberSAIs continues to be a sourceof assistance accounts.In addition, the direct intervention by the President to us in our effort. was obtained to encourage accounting officers and the ac- If Guyana is to have a successful democraticgovernment, countant general to honor their statutory responsibilities. effective systemsof public and parliamentary accountability We were successfulin having the Financial Admiuistra- are vital. A strong audit office is therefore avery high priority. tion and Audit Act amendedto confirm the Auditor Generalas The OAG, like SAIs throughout the world, is committed to the auditor of all public corporations and other bodies where ensuring that this happens.E International Journal of Government Auditing - April 1994 News i Canada in a meaningful way. Chapter 5 of the tee members,most of them new to Par- report, “Information for Parliament- liament, become familiar quickly with 1993 Annual Report Understanding Deficits and Debt,” dis- the main issuesof interest to the Office Thispast January 17,Cauada’s35th cusses proposals to make the budget and on which they might want to con- Parliament since Confederation in 1867 process more open and suggests five sider taking someaction. Judging by the openedits doors for business.Two days simple indicators of financial condition number of requestsfor further informa- later, on January 19, Auditor General that, if reported by government in a tion and for appearancesbefore the Denis Desautels delivered his annual consistent manner from one year to the committeesofexpertwitnessesfromthe report for the ffical year ended March next, would help Canadiansand Parlia- Office, this initiative has been a much- 3 1,1993, to the House of Commons for mentarians develop an appreciation of appreciatednew service that the Office its consideration.The fact that 208 of the the deficit problem. would consider doing again, especially with a change
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