THE ROLE OF AN AUDIT SERVICE UNIT IN EFFICIENT

MANAGEMENT OF RESEARCH RESOURCES

Presentation By:

SLARI Internal Audit Department

BackgroundWhen SLARI was formed in 2007 there was nothing like an internal audit unit. There was no internal control system, lack of supporting documents and the use of SLARI finances. An issue came up that was sent to the Anti Corruption Commission. Arrests were made and court cases followed which subsequently, led to the conviction, dismissal and imprisonment of the staff members involved.The external audit report about SLARI again conducted in 2010 for 2009 Financial Year revealed a huge amount of money that was not accounted for, which also caused serious problems for the Institute.This necessitated the creation of an internal audit unit charged with responsibility of ensuring internal control systems. The unit however initially had challenges including:

Staff frowning at the creation of the unit. Trying to put the internal controls systems in place to avoid a repeat

of the same ugly situation. Scientists and other staff members who handled SLARI funds still did

not comply with the policy of submitting credible documents.

The then Director General, Dr. Alfred Dixon took the issue- staff non-compliance on

submitting returns to council and the council members gave their support.

The only remedy to this situation at the time was withholding salaries of staff who failed to

submit returns for research activity. This suggestion was tabled before council for the Council

to find ways and means to remedy the situation. It was agreed by Council that salaries of all

those who fail to submit returns should be withheld.

This however met some successes, there was compliance and this was evidenced when in

2010 the external audit exercise carried out was good in terms of compliance with returns

and other areas.

The Internal Audit Unit of the Sierra Leone Agricultural Research Institute (SLARI) also has

the responsibility to look into all SLARI financial transactions for its core funds

and project activities and the internal controls systems put in place to ensure

the accuracy and reliability of the financial records and to safe guard the

assets of SLARI as a whole.

The Unit conducts audit inspections twice during the year i.e. January – June

and July to December. The scope of the audit covers both finance and capital

assets owned by SLARI.

The assets including guest houses and canteens found at the SLARI Centres fall

under the scope of the Audit Unit.

The unit is obliged to look at compliance with the payments of statutory

deductions like NASSIT, PAYE or Income tax and even staff contribution to the

staff benefit account for staff retirement or terminal ben

Objective The objective of the SLARI internal audit is to ensure that internal control system

works well;

Makes meaningful contributions to management as to how costs can be saved. So

that government and donor funds allocated to SLARI are judiciously utilized for its

intended purpose for the benefit the Sierra Leoneans.

Laid down policies for the operation of SLARI is followed fully.

Make recommendations to Management on other pertinent issues

The current situation at SLARI with regards internal controls still has challenges. The unit is trying hard to ensure compliance. The penalties, including withholding of salaries for failing to submit returns on time still stand. Compliance rate is encouraging, but there are still defaulters.

Challenges Procurement In the area of procurement the unit has observed that procurement procedures are not properly followed. This again goes against best practice and may result to serious consequences if action is not taken.

Budget

The internal audit unit during its review of returns realized that budget lines are not followed strictly. If in any case a budget is altered while in the field of implementation scientists must make justifiable explanations in writing and attach such document to the returns before submission for audit verification.

However, the unit expects 98% of the expenditure for any research should go by the budget line presented for funds.

Supporting Documents

Supporting documents presented including receipts does not meet half of the ten qualities of an authentic receipt and is risky and difficult to defend to External Auditors, Parliament and the Court.

Therefore the unit would like to use this opportunity to advice that authentic receipts should be obtained when purchases are made.

The internal audit also observes that per diem claim forms are not fully endorsed or signed by respective authorities at centres before payments are made.

Vehicle Log Books

Another challenge the unit is facing is in the area of vehicle log

books. All SLARI vehicles are supposed to have log books for

recording of mileages and fuel supply. The unit has observed

with grave concern that the drivers fail to record mileages as

they go around with officials. Failing to record the mileages, will

affect the proper reporting of fuel consumption. These are

queries that may difficult to give convincing answers to.

“Ignorance of the Law is no Excuse”.

Audit Inspection of Project Sites

Our current audit shows a weak internal control lapse for most of the SLARI implemented projects more so for monitoring. The problem is likely because there is lack of adequate control measures to ensure site visits by the Internal Audit Unit. Although the project proposals note that on- site monitoring should be done at least once during project implementation. In order to help put on track SLARI implemented projects that may not be on course as a result of unseen factors; it is our humble position that a quarterly site of such projects be recognized and is effected by the internal audit unit and the Monitoring and Evaluation Officer.

Audit Committee

The Audit committee is a committee that looks into all audit reports prepared by the Internal Audit Unit of SLARI. The committee goes through the report and ensures that all recommendation put forward by the Internal Audit is complied with fully to put the internal control systems on its proper footing.In the recent external auditors report it was recommended that an audit committee be formed which shall include members outside SLARI with thorough knowledge in accounting and administration.The Unit would therefore suggest to the Director General to table this issue at the next Council Meeting for the appointment of members of this committee.

Recommendations

A number of challenges have been highlighted so far in this report. The Unit would like to make recommendations to management if we want to see an effective management of research resources. The Challenges highlighted should be considered and looked into

carefully and appropriate action taken. All the areas we see lapses should be addressed for SLARI to be a better place.

More importantly, the issue of returns is still a challenge even though management through council instituted the withholding of salaries. We therefore want to recommend that the accounts department prepare an imprest register where all funds allocated to scientists or other officers of SLARI will be entered to be able to know all those handling SLARI funds. An officer or scientist requesting for funds must have sent returns for previous funds collected before requesting for another fund. This can be verified through the register. This should be an addition to the already existing sanction of withholding salaries.

Recommendations

That all SLARI officials using SLARI vehicles must sign in the log books stating

reasons for which vehicles are assigned. A driver using any vehicle must

always ensure that mileages covered are recorded in the log book.

Conclusion

I wish to express my thanks and appreciation to the chairman and all of you

present here for the attention. If we want SLARI to be a better place we need

to do the right things and try to work cohesively with one focus of achieving

one objective. What we are doing now is what our children will inherit from

and continue the fight to make SLARI a better place.

We should therefore avoid the risk of going to Parliament, Anti Corruption

Commission or Court to answer lamely to questions that cannot bail us out

and that can damage the image of the institution.

I Thank You All.