Aug 07, 2020 Letters Comments Off on Urgent need of risk management, internal audit and a UG Diploma in Auditing
On the eve of the General Elections on March 2 earlier this year, I had written a letter articulating the need for the new government to establish a risk management and internal audit function in each government agency to bolster oversight and accountability. I would like to echo that call again in addition to asking the University of Guyana to introduce a Diploma in Auditing programme. I suggested over a decade ago at that institution and which was approved but never implemented. Countries like Canada, Israel, Malta, South Africa, and Sweden, as an example have all successfully implemented internal audit functions in government ministries with effective coordination between internal audit and their respective audit offices. Huge monetary and non-monetary savings have been realized.
An internal audit function will provide risk-based and objective assurance, advice, and insight for a better-run ministry to ensure the new policies of the government are implemented, operations are effective and efficient with economical use of resources. The existence of a risk management effort which entails a structured approach that aligns strategy, processes, people, technology, and knowledge to manage risks and uncertainties is now a best practice. Resources are deployed to the greatest effect while problems are identified long before they take root ultimately leading to improved outcomes. The risk management effort will complement internal audit and enhance internal oversight and coordination between departments, and institutionalise robust decision-making, thus ensuring value for public funds being spent.
Traditional academic accounting programs do not address the specific skills for today’s auditors in this era of technology, digital transformation, and big data world and ever-changing risk, control, and governance landscape where auditors need to be smarter and most current. My proposed two-year Diploma in Auditing programme covered areas like financial statement auditing, government accounting, public sector auditing, information technology auditing, fraud auditing and investigation, operational auditing, and value-for-money auditing. Moreover with limited resources and technological advancements, auditors can be trained to audit smarter with real-time data and address problems instantly.
A well-structured and equipped internal audit effort or even elements of it is a critical element in public sector agencies where it can cover areas not ordinarily covered by the Audit Office. Its mandate encompasses extensive financial, operational, value-for-money, systems, and special audits within that ministry. Internal auditors at a ministry will garner detailed knowledge of that ministry’s risks and operations and root out problems long before they explode. Such knowledge can be unleashed to assess the economical acquisition and use of resources, efficiency of routines, and effectiveness in the discharge and application of government policies.
An internal audit and risk effort can be tailored to local conditions and will enable the government to make smarter decisions and embed a respect for taxpayer dollars within government itself. As a result, all Guyanese can expect improved services, better value for their money and smarter government. In addition, a two-year Diploma in Auditing program will attract students from around the Caribbean as the University of the West Indies does not have such a program in place.
I am quite sure that with the new government now in place reflecting the will of the Guyanese, that organizations like the World Bank, IMF, INTOSAI (International Organization of Supreme Audit Institutions), the Global Institute of Internal Auditors, and IADB will be only too keen to help with these initiatives of mine. Moreover, there are qualified people in Guyana who can be tapped.
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