INTERNATIONAL PROJECTS GROUP

Background

A number of parallel initiatives are driving an

increasing focus on the development of effective

audit regimes in both the public and private sector

worldwide. These include:

• the need to improve investor confidence in the

wake of a number of international accounting

scandals

• a greater awareness of the need for

transparency and accountability in the Public

Financial Management (PFM) cycle, including

the receipt of revenues and the allocation and

expenditure of public funds, and the role which

a Supreme Audit Institution (SAI) should play in

ensuring value-for-money

• a trend by the international donor community

to include Direct Budgetary Support to their aid

portfolio– further emphasising the increasing

role played by SAIs

• an increasing convergence in both the auditing

and accounting spheres between international

standards of public and private sector policy

and practice.

Our experience

As one of the leading international audit and

accountancy networks, BDO has been at the

forefront of these developments. In the UK in

particular, both the public audit bodies (the

National Audit Office and the Audit Commission)

routinely mandate private sector accounting

practices to undertake audits of public sector

organisations on their behalf. As a result, in recent

years BDO has undertaken more than 50 such

public sector audits (both external and internal)

with an annual fee value in excess of £ 6.25 mill.,

under the auspices of these two organisations.

One of the core themes of developmental

consultancy is the sustainable implementation of

sensitively modified international best practice

into sectors and institutions in developing nations

and emerging markets. Building on its leading-edge

audit expertise in the UK, BDO’s International

Projects Group (IPG) has successfully transferred

this body of knowledge and skills to clients around

the world.

Public and private sector audit and assurance

A selection of assignments

• Sierra Leone – a 7½ -year, DFID-funded

project designing and implementing a

comprehensive Technical Assistance (TA)

Programme for the SAI. Included a legislative

review, institutional development and capacity-

building, the development of policies and

procedures, HR development, formal training

and on-the-job training through INTOSAI-

compliant Joint Audits, awareness-raising for

the legislature (PAC) and civil society groups, as

well as the development of external training

institutions.

• Afghanistan – two phases (1 & 3) of a World

Bank funded TA Programme to the Control and

Audit Office (CAO) comprising 5½ years of

support in total. The focus of the programme

was to introduce best practice in public sector

auditing policies, procedures and techniques,

including design and delivery of training

programmes working along-side CAO teams

undertaking audit assignments.

• Liberia – designed and presently implementing

a comprehensive 2-year programme of technical

assistance to the General Auditing Commission

(GAC). Specific activities include strengthening

the legal and regulatory framework of the GAC,

its organisational structure and procedures, and

the development of audit manuals, CAATs and

other audit support tools.

• South Sudan – 6-year World Bank-funded

institutional development and capacity-building

programme providing technical assistance to

the South Sudan National Audit Chamber, the

SAI for the newly self-governing country. The

underlying core of the project was a

comprehensive programme of joint audits,

encouraging the transfer of knowledge by

alongside-working.

.

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• Occupied Palestinian Territories – for the EU,

designed and presently implementing a

comprehensive 2-year programme of technical

assistance to the Palestinian State Audit and

Administrative Control Bureau (SAACB), supporting

its establishment and development as a fully

independent institution and in line with INTOSAI

standards.

• Kyrgyz Republic – responsible for the external and

internal audit components of a multi-component,

DFID - funded programme of TA support to the

Ministry of Finance. For the Chamber of Accounts

(the Kyrgyz SAI), developed Code of Ethics, Code of

Conduct and detailed Audit Manual with associated

procedures. For MinFin Internal Audit Department,

introduced the modern concepts of internal audit

and internal financial controls and assisted in roll-

out of internal audit procedures and practices to key

spending ministries.

• The Gambia – led a consortium providing 2 years of

Technical Assistance under the Gambia Financial

Governance Programme and responsible in particular

for the provision of institutional strengthening and

capacity-building support to the Gambian National

Audit Office (GNAO), the Supreme Audit Institution.

Involved working with the Auditor General and his

staff to prepare and implement a strategic

development plan for the NAO to guide its

transformation and development into an

internationally-recognised SAI.

• Bangladesh - currently implementing the

Strengthening Public Expenditure Management

Program (SPEMP-B). The main task is to assist the

Office of the Comptroller and Auditor-General

(OCAG) of Bangladesh to work towards the adoption

of international auditing standards, making the

necessary changes in their working methods to

achieve this goal. The project is also assisting with

organisational development, working with its

Financial Management Academy (FIMA) to develop an

institution that can deliver trained and educated

professional audit officers for the future.

• Bosnia and Herzegovina – 2-year programme of

support to the introduction of Public Internal

Financial Control (PIFC) in Bosnia and Herzegovina

funded by the EC, including direct support to the

Central Harmonisation Units as well as Introduction

of best practice PIFC and internal audit policies and

practices.

• Russia – Tacis-funded 2-year project to assist the

Ministry of Finance in the development of private

sector auditing standards and professional

associations. Involved a review of existing standards,

an evaluation of these against international norms

and the development of a recommended code of

good practice. Also included an extensive

programme of seminars and European study tours,

the publication of regular reports on auditing in

Russia, the development of a web site focused on

the audit profession and a “hot line” providing a

rapid response to auditors’ queries.

• Sierra Leone – financial systems audit, EC imprest

replenishment request approval and value-for-money

review of five agricultural projects financed by EDF

resources, provided by a full-time audit team over a

period of five years.

• Russia – value-for-money review and financial audit

(applying IAS) of a World Bank Programme disbursing

US$300 mill. for the rehabilitation and maintenance

of selected Federal roads.

• Sierra Leone – preparation of EC/EDF TA

Programme for the Auditor-General’s Department

and review of budget preparation and monitoring

systems adopted by two key ministries.

• Kosovo – design and implementation of best

practice internal financial controls and internal audit

procedures in the Ministry of Economy and Finance

and line ministries. The project increased the

capacity of the internal audit function across

government institutions and improved the

effectiveness and efficiency of public spending.

• Russia – support to the Federal Ministry of Finance

and internal and external control institutions

(Treasury and Chamber of Accounts) for the

introduction of an internal control and audit system

in the public sector. The project provided an

analysis of European ‘best practices’ in

implementing an internal control and audit system,

adapting them to reflect the Russian budgetary

environment.

• Afghanistan – Monitoring Agent of the World Bank-

administrated Afghanistan Reconstruction Trust Fund

recurrent fund window which disburses

approximately US$ 200 mill. per year.

For more information on our consultancy services for developing

nations, emerging markets and transition economies, please

contact:

Murray Ross, Partner

BDO LLP, 55 Baker Street, London W1U 7EU

e: murray.ross@bdo.co.uk | t:+44(0)20 7893 3338 |

f:+44(0)871 429 9198 www.bdo.co.uk