INTOSAI Compliance Audit Guidelines (ISSAI 4000-4200)
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Transcript of INTOSAI Compliance Audit Guidelines (ISSAI 4000-4200)
INTOSAI Compliance Audit Guidelines(ISSAI 4000-4200)
Presentation by (name and tittle)Venue and date
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Content
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4INTOSAI and ISSAI framework
The Professional Standards Committee (PSC) and the Compliance Audit Subcommittee (CAS)
Compliance AuditISSAI 4000-4200
Implementation
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INTOSAIINCOSAI
Governing Board Secretary GeneralRegional Working
Groups
Capacity Building Committee
Professional Standards Committee
IDIPerformance Audit Subcommittee
Knowledge Sharing Committee
Finance and Administration Committee
International Journal of Government Auditing
Financial Audit Subcommittee
Compliance Audit Subcommittee
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The South Africa DeclarationXX INCOSAI (2010) resolves to call upon its members and
other interested parties to: Use the ISSAI framework as a common frame of reference for
public sector auditing; Measure their own performance and auditing guidance against
the ISSAIs; Implement the ISSAIs in accordance with their mandate and
national legislation and regulations; Raise the awareness of the ISSAIs and INTOSAI GOVs globally,
regionally and at the national level; Share experience, good practice and challenges in
implementing the ISSAIs and INTOSAI GOVs with those responsible for developing and revising the ISSAIs and INTOSAI GOVs
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The Purpose and Authority of the ISSAIs
provides an Institutionalised Framework for SAIs to: promote development and transfer of knowledge improve public sector auditing worldwide enhance the professional capacities, standing and
influence of its members in their respective countries
Two sets of professional standards: ISSAIs - the International Standards of Supreme Audit
Institutions INTOSAI Gov - the Guidance for Good Governance
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ISSAI FrameworkLevel Subject ISSAI No1 Founding Principles Lima Declaration 12 Prerequisites for
functioning of SAIsIndependenceTransparency and AccountabilityEthicsQuality
10-40
3 Fundamental Auditing Principles
Basic PrinciplesGeneral -, Field – and Reporting Standards
100-400
4 Auditing Guidelines Financial Audit GuidelinesPerformance Audit GuidelinesCompliance Audit GuidelinesSpecific Guidelines
1000-29993000-39994000-49995000-5999
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ISSAIs add value to the work of SAIs
Adherence to the ISSAIs
Promotes transparency in the public sector and adds Credibility to our work as auditors
Improves the effectiveness and efficiency of the work of the SAI and provide the basis for high Quality audits
Increases the perceived level of Professionalism of the SAI
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Content
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4INTOSAI and ISSAI framework
The Professional Standards Committee (PSC) and the Compliance Audit Subcommittee (CAS)
Compliance Audit ISSAI 4000-4200
Implementation
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Professional Standards Committee(PSC)
ObjectivesPromote strong, independent and multidisciplinary SAIs by:
Encoururaging SAIs to lead by example
Contributing to the development and adoption of appropriate and effective professional standards
PartnersThe PSC is working together with other international, recognized standard-setting bodies:
The International Federation of Accountants (IFAC)
The Institute of Internal Auditors (IIA)
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Compliance Audit Subcommittee
Compliance Audit Subcommittee (CAS)
ObjectiveDevelop high quality, globally accepted guidelines for Compliance Audit in the public sector
StrategyThe objective will be reached by cooperation, participation and commitment by all committee members and the INTOSAI community, and by cooperation with other standard setting bodies.
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Content
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4INTOSAI and ISSAI framework
The Professional Standards Committee (PSC) and the Compliance Audit Subcommittee (CAS)
Compliance AuditISSAI 4000-4200
Implementation
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Three Audit types
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Financial audit
The reliability of financial reporting
Compliance audit
Compliance of a subject matter with criteria
Performance audit
Economy Efficiency Effectiveness
Compliance Audit – bridging the gap
Compliance AuditThe independent asessment of whether a particular subject matter is in compliance applicable authorities identified as criteria.
The Compliance Audit Guidelines - two main perspectives
ISSAI 4000 - General introduction to compliance audit
ISSAI 4100 - deals with compliance audit performed separately from the audit of financial statements, for example as a separate audit task or related to performance audit
ISSAI 4200 - deals with compliance audit related to the audit of financial statements
Written as consistent, stand-alone documents
Compliance audit:the extended perspective
Origins of cash flow in the public sector are the decisions and premises of the legislature
Compliance audit provides guidance for compliance audit related to the audit of financial statements in the public sector, including; concerns that public funds are used for the intended
purposes principles of sound management are followed in the
execution of the budgets
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Compliance Audit Guidelines:integrated approach with Financial
Audit Guidelines Compliance Audit guidelines
developed within the same structure
Cross-references made to other relevant ISSAIs
Issues on compliance audit dealt with in the context of the audit of financial statements
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Compliance Audit Guidelines:Compliance Audit performed separately from
the audit of financial statements
Caracteristics of Compliance Audit
TransparencyAccountabilityStewardshipGood governance
Compliance Audit
Compliance Audit – The extended perspective
The specific constitutional arrangemement of the SAI
Compliance Audit
THE LEGISTALURE
THE EXECUTIVE
THE ENTITY
AUTHORITIES
AUTHORITIES
AUTHORITIES
INTENDED USER
PRACTITIONER
ELEMENTS OF AN AUDIT
RESPONSIBLE PARTY
THE LEGISLATURE
THE EXECUTIVETHE SAI
The three parties of an audit
Extension in terms ofAUDIT PRINCIPLES
Propriety
Regularity
Extension in terms ofAUDIT APPROACH
Quantitative Qualitative
Extension in terms ofReporting formats
Long form reporting Short form reporting Findings, conclusions,
opinions
Attest engagements
Direct reporting
Variations of Compliance Audit
SCOPE & SUBJECT MATTER
REPORTING FORMATS
AUDITAPPROACH
AUDIT PRINCIPLES
Compliance Audit Process
Documentation, Com
munication, Quality Control
Initial conciderations
Planning the audit
Performing the audit and gather evidence
Evaluating evidence & forming Conclutions
Reporting
Court of Accounts issues
Summing up Compliance audit is the missing link between financial
audit and performance audit.
Compliance audit profits from structure and continuity of financial audit, and the political relevance and methodologically diversity of performance audit.
Compliance audit adds power and relevance to the annual audit report.
Compliance audit can be integrated in a variety of subject matters and audit approaches, tailored to different audit mandates and different jurisdictions.
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Content
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4INTOSAI and ISSAI framework
The Professional Standards Committee (PSC) and the Compliance Audit Subcommittee (CAS)
ISSAI 4000-4200
Implementation
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Adoption and implementation
It is the responsibility of all INTOSAI members to help establish the ISSAI framework as a common frame of reference for public sector auditing.
In doing so, there are two main aspects to address:
1. The decision of adopting the ISSAIs by the SAI;
2. The implementation process.
ISSAIs can be implemented in two ways
By developing national standards on the basis of ISSAI 400 Fundamental Principles of Compliance Auditing
By adopting the Compliance Audit Guidelines as authoritative standards
Implementation steps
Awareness ( highlighting the benefits of using the
ISSAIs)
Sustaining the results
Applying the standards
Learning the standards
Link the ISSAIs to the priority needs of SAI
Implementation:to improve audit quality
Implementation:quality in SAI core business
Suitable audit criteria
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Sufficient and appropriate audit evidence
Assurance & confidence of users
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ISSAIs on Compliance Audit
Outlines the basic steps and requirements on how to perform the SAI core process of Compliance Audit
– adjusted to the specific constitutional
arrangement of the SAI.
Compliance Audit
TransparencyAccountabilityStewardshipGood governance
Compliance Audit