1. 10th Annual Conference and Annual General Meeting of the Southern African Development Community Organisation of Public Accounts Committees (SADCOPAC) How to use Performance Audit reports to conduct effective oversight. An audit perspective. John F. S. Muwanga Auditor General-Uganda Arusha, 3 September 2013

2. AGENDA (i) Obtaining an understanding of what Performance Audits are. (ii) Contextualizing effective oversight in the form of good governance. (iii) Examining the PAC expectation gaps (iv) Conclusion - Examining the characteristic of a good report that result in effective oversight "bring about good governance"

3. Performance Audits What is performance auditing ?? Economy – Doing things cheaply[ Spending less] Efficiency- Doing things right. [Spending well ] Effectiveness- Doing the right things.[Spending wisely] 3

4. Effective oversight – Good governance Contextualizing effective oversight into good governance Definition of governance – exercise of power or authority – political, economic, administrative or otherwise – to manage a country’s resources. Definition of good governance – competent management of a country’s resources and affairs in a manner that is open, transparent, accountable, equitable and responsive to the people’s needs ….. Australian Agency for International Development (AusAID),August 2000 4

5. Elements of Good Governance – Asian Development Bank perspective 1.Accountability 2.Participation 3.Predictability 4.Transparency …. Asian Development Bank perspective 5

6. What is the expectation gap In order to achieve effective oversight using the Performance audit reports it is essential that there is no mismatch between what the SAI report on, and what the stakeholders (PAC) expectations are. An ‘expectation gap’ represents the difference between what key stakeholders (PAC) expect from performance audit reports and what is actually reported.

7. EXPECTATION GAPS Possible expectation gapChallenges making it difficult to meet PAC expectation Too few performance audit reports are produced -Lack of sufficient resources in the SAI -Lack of technical support -SAI capacity needs not built stepwise -Performance audit is time consuming and expensive Reports are not easy to grasp and understand Performance audit is challenging & capacity needs to be built stepwise Audit problems, findings and conclusions are not sufficiently relevant SAI capacity needs to be built stepwise & not tackling complex areas in early stages of development

8. EXPECTATION GAPS EXPECTATION GAPS Possible expectation gapChallenges making it difficult to meet PAC expectations Audits take too long and are expensive - Performance audits take long since each is a new study area - Difficult to identify objectives and obtain relevant data from Government - Government is late in submitting information and to respond to drafts. SAI do not submit performance audit reports to Parliament - SAI mandate may be unclear - The quality of the reports or PACs interest in handling them may be unclear for the SAI management PAC is not deliberating on performance audit reports - PAC may not have had time to adjust their operations or does not have sufficient capacity to do so. - Reports may not be considered sufficiently relevant

9. Conclusion Characteristics of a good report Address an important topic within the mandate of the SAI Present an appropriate audit design Understanding of the organisation’s system Present complete & concise audit evidence Findings congruent with the audit objective Report presents reasonable conclusions

10. Conclusion Characteristics of a good report..continued.. Adds value Balanced and fair Well structured Discussed with the audited entity

11. Conclusion THANK YOU FOR YOUR PATIENCE AND FOR LISTENING TO ME