Transcript CAS official presentation

INTOSAI Compliance
Audit Guidelines
(ISSAI 4000-4200)
Presentation by (name and tittle)
Venue and date
1
Content
1
Implementation
4
2
Compliance Audit
ISSAI 4000-4200
INTOSAI and ISSAI
framework
3
The Professional
Standards Committee
(PSC) and
the Compliance Audit
Subcommittee (CAS)
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INTOSAI
INCOSAI
Regional Working
Groups
Professional
Standards
Committee
Performance Audit
Subcommittee
Financial Audit
Subcommittee
Governing
Board
Secretary General
Capacity
Building
Committee
Knowledge
Sharing
Committee
IDI
International
Journal of
Government
Auditing
Finance and
Administration
Committee
Compliance Audit
Subcommittee
3
The South Africa Declaration
XX 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 Framework
Level
Subject
ISSAI No
1
Founding Principles
Lima Declaration
1
2
Prerequisites for
functioning of SAIs
Independence
Transparency and Accountability
Ethics
Quality
10-40
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Fundamental
Auditing Principles
Basic Principles
General -, Field – and Reporting
Standards
100-400
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Auditing Guidelines
Financial Audit Guidelines
Performance Audit Guidelines
Compliance Audit Guidelines
Specific Guidelines
1000-2999
3000-3999
4000-4999
5000-5999
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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
1
Implementation
4
2
Compliance Audit
ISSAI 4000-4200
INTOSAI and ISSAI
framework
3
The Professional
Standards Committee
(PSC) and
the Compliance Audit
Subcommittee (CAS)
8
Professional Standards Committee
(PSC)
Objectives
Promote strong,
independent and
multidisciplinary SAIs by:
 Encoururaging SAIs to
lead by example
 Contributing to the
development and
adoption of
appropriate and
effective professional
standards
Partners
The 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)
Objective
Develop high quality,
globally accepted
guidelines for Compliance
Audit in the public sector
Strategy
The 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
1
Implementation
4
2
Compliance Audit
ISSAI 4000-4200
INTOSAI and ISSAI
framework
3
The Professional
Standards Committee
(PSC) and
the Compliance Audit
Subcommittee (CAS)
12
Three Audit types
Financial
audit
Compliance
audit
Performance
audit
The reliability of
financial
reporting
Compliance of a
subject matter
with criteria
Economy
Efficiency
Effectiveness
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Compliance Audit – bridging
the gap
Compliance Audit
The 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, standalone 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
Transparency
Accountability
Stewardship
Good governance
Compliance Audit –
The extended perspective
The specific constitutional
arrangemement of the SAI
THE LEGISTALURE
AUTHORITIES
THE EXECUTIVE
AUTHORITIES
AUTHORITIES
THE ENTITY
Compliance Audit
The three parties of an audit
THE
LEGISLATURE
INTENDED
USER
ELEMENTS
OF AN AUDIT
THE SAI
THE EXECUTIVE
PRACTITIONER
RESPONSIBLE
PARTY
Extension in terms of
AUDIT PRINCIPLES
Extension in terms of
AUDIT APPROACH
Quantitative
Qualitative
Extension in terms of
Reporting formats
Attest
engagements
 Long form reporting
 Short form reporting
 Findings, conclusions,
opinions
Direct
reporting
Variations of Compliance Audit
SCOPE &
SUBJECT
MATTER
AUDIT
APPROACH
REPORTING
FORMATS
AUDIT
PRINCIPLES
Compliance Audit Process
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
1
Implementation
4
2
ISSAI 4000-4200
INTOSAI and ISSAI
framework
3
The Professional
Standards Committee
(PSC) and
the Compliance Audit
Subcommittee (CAS)
31
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
Sustaining the
results
Applying the
standards
Learning the
standards
Link the ISSAIs to the
priority needs of SAI
Awareness ( highlighting
the benefits of using the
ISSAIs)
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
Transparency
Accountability
Stewardship
Good governance