IMPLEMENTATION OF ISSAI 4000 By Mrs. Raj Esther Thomas Regularity Audit Manager CAS 14th Meeting in New Delhi, India 20-21 February 2017

Innovation and Creativity Developing Competence Improving Credibility STATEMENT OF INTENT Making a difference in the performance of SAIs OUR MISSION AFROSAI-E is, through innovation, committed to cooperate with and support its member SAIs to enhance their institutional capacity to successfully fulfil their audit mandates, thereby making a difference to the lives of citizens   VALUE STATEMENT Innovation and Creativity Developing Competence Enhancing Confidence Improving Credibility

Overview Pilot Audit Development of Compliance Audit Methodology Compliance Audit Manual (CAM) – Exposure Draft

AFROSAI-E Pilot audit Workshop 5-9 September 2016 Pilots from Botswana, Eritrea, Kenya, Seychelles, Zambia and Zimbabwe Facilitator from CAS and OAGN First Draft of CAM shared with the pilots

Follow-up workshop 30 Jan to 3 Feb 2017 Country Support visits AFROSAI-E Pilot audit Subject matters: Procurement, Performance Information, Extractive Industries and IFAD Projects Follow-up workshop 30 Jan to 3 Feb 2017 Country Support visits

AFROSAI-E Pilot audit Training workshop – Sept 2016 Introduction to ISSAI 4000, exposure draft Compliance Audit – risk based approach Sessions with presentation and practical group work Feedback from participants on ISSAI 4000 and structure of the compliance audit manual’s first draft

AFROSAI-E Pilot audit Follow-up workshop – Jan-Feb 2017 Racap of Compliance Audit methodlogy Presentations from the pilots Feedback from particpants and group discussions Individual feedback

Audit of Externally Funded Projects in Agriculture & Food Security Cooperating Partner : IDI and IFAD AFROSAI-E collaborating with IDI on this audit program Malawi Liberia Rwanda The Gambia Sierra Leone Tanzania Zambia Research done by IDI and AFROSAI-E revealed that countries in Africa are among the highest recipients of development aid in agriculture and food security. IFAD is a specialized agency of the United Nations. Established to finance agricultural development projects primarily for food production in the developing countries.

Programme components 1. Agreement with SAI leadership Roles & responsibilities 2. Design and Development of Guidance and Tools 3. Workshop for SAI Teams and development of plans 4. Pilot Audits and Support for finalising audit report 5. Independent assurance of audit quality 2017

SAI Commitments 1 Agreement with SAI leadership Roles & responsibilities Agreement made among all the stakeholders in the programme on the key deliverables of the programme as well as agree on the imprementation strategy 2 Design and Development of Guidance and courseware Developed Financial audit and Compliance Audit Courseware as well as guides for project audit in accordance with ISSAIs Participants trained in Compliance and Financial Audits as per ISSAIs. Focused on Direct Reporting CA as per ISSAI 4000 Training and Planning Workshop for SAI teams - 2016 3 4 Participating SAIs conduct audits as per standards and report on their audits - 2016 6 SAIs conducted the audits on IFAD Projects in both FA and CA Onsite support provided to 3 SAIs IFAD Suggestions for possible areas of focus 10

CAM Based on ISSAIs ISSAI 100 Fundamental Principles of Public Sector Auditing ISSAI 400 Fundamental Principles of Compliance Auditing ISSAI 4000 Compliance Audit Standard

CAM Structure Chapter 1: CA in public sector context Chapter 2: Key concepts of Compliance Audit Chapter 3: General principles and requirements of compliance auditing Chapter 4: Overall CA Planning Chapter 5: Compliance Audit Process – step by step approach Appendix: Guidance on report writing and sampling Working paper templates

Compliance Audit Process Initial considerations Planning the Audit Performing the audit and gathering evidence Evaluating evidence and forming conclusions Reporting

Guidance Regularity vs Propriety Reasonable vs Limited Assurance Direct Reporting vs Attestation Engagement Conclusion vs Opinion Standalone vs Combined Audit ISSAI 1250 vs ISSAI 4000

Levels of assurance and engagement types   Direct reporting Attestation Assurance level Reasonable assurance Conclusion Opinion Limited assurance

Questions Is compliance audit mentioned in your SAIs mandate? Does your SAI have discretion to select subject matter? What challenges do you think you will encounter in applying this methodlogy

Response from SAIs 14 SAIs responded to these questions 6-7 combined approach of these Challenges: Resistence to change Lack of capacity and skills Peformance vs compliance audit

Future development Combined audit approach for compliance and financial audits AFROSAI-E needs to address this in the near future

www.afrosai-e.org.za CONTACT AFROSAI-E esther@afrosai-e.org.za secretariat@afrosai-e.org.za AFROSAI-E @AFROSAIE

THANK YOU