A GOOD IDEA WHICH CAN BE MADE BETTER

May 29, 2014 Features / Columnists, Peeping Tom

The government has established or plans to establish an Internal Audit Department as a means of ensuring greater accountability and in order also to reduce the incidence of fraud and public malfeasance.
This Internal Audit Department will fall under the Ministry of Finance. All departments of the government must be responsible to some subject minister and in this instance the proposal is for such ministerial responsibility to be reposed in the Minister of Finance, as it rightly should. It is the Minister of Finance who is responsible to the National Assembly and by law under the Fiscal Management and Accountability Act for the proper spending of public funds. As such it is only fit and proper that it is who should hold ministerial responsibility for the Internal Audit Department.
This Department in no way dilutes to takes away the ultimate responsibility for the auditing of public funds from the Office of the Auditor General. No the Auditor General is still expected to pronounce upon the use and accounting for public funds. In so doing the Auditor General cannot be expected to detect every fraud and correct any flaws in systems. The job of State auditors is not to comb through every transaction done within the government. The principal task is to pronounce of the government accounts as presented for auditing.
Too often, far too often, the Office of the Auditor General is being summoned to investigate alleged frauds within government. Too often scarce resources available to the Office of the Auditor General have to be deployed to help investigate malfeasance and fraud within government departments. This should not be happening and is an unnecessary burden to the Office of the Auditor General.
The Auditor General cannot be expected to micro-police the bulk of government transactions. This would represent an onerous burden on his Office. The Office of the Auditor General cannot be reasonably expected to detect every fraud or incidence of maladministration in so far as the finances of the government.
And every time there is a suspicion of a fraud within a government agency, the Auditor General should not be summoned to conduct an investigation. This violates the independence of the Office and turns the Office of the Auditor General into an Internal Audit Division of the government, allowing the Office of the Auditor General to become a servant of the government rather than the external Auditor which the Office is expected to play.
Each government department should have its own internal audit departments. These departments are better suited to the type of fine-teeth comb policing that many people expect of the Office of the Auditor General. It will also allow for proactive work in preventing fraud.
Each government Ministry should have its own Internal Audit Unit to ensure that the day to day financial transactions are conducted in accordance with established rules and procedures. Such departments will help intercept fraud and ensure that systems are being complied with. They will also conduct investigations into alleged fraud and therefore relieve the Office of the Auditor General of having to be summoned to undertake such investigations.
The Office of the Auditor General should remain the external auditors of the State but the internal auditors should not be centralized as is presently proposed. There is no need for a centralized Internal Audit Department. What is needed is for every government department and ministry to have its own internal audit departments.
This will be costly but accountability has its price. Instead therefore of there being a single Internal Audit Department located and accountable to the Ministry of Finance, there should be individual but small internal audit departments in each government Ministry.

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