- What are the various types of audit conducted by OAG ?
- Does OAG have any affiliation to any international professional body?
- Is OAG's audit work governed by professional standards ?
- What are the objective of Auditor General's Reports
- What is OAG's role in preventing fraud and corruption in the public sector?
- Where can I get copies of Auditor General's reports ?
- What internal management processes have been adopted by OAG to fulfil its mandate efficiently and effectively ?
- How does OAG propose to cope with its ever increasing workload
- What are major Management Challenges being faced by OAG management?
- What impact the computerisation of government financial management will have on OAG's work?
- What steps are being taken to enhance the information technology capabilities of OAG?
- Does OAG get external financial assistance for capacity building ?
1.What are the various types of audit conducted by OAG ?
In order to provide the Parliament with relevant information on all aspect of Government's functioning, the Office of the Auditor-General undertakes three basic types of Audits:
- Financial audit
- Compliance audit
- VFM Audit
which is the most traditional form of audit, is basically concerned with expression of opinion on the financial statements and the appropriateness of the accounting records and the adequacy internal control systems. Financial audit is an essential requirement because of the need for an independent and objective assurance on the correctness of the accounts and financial statements prepared by the Department of Finance, Provincial Governments and public bodies.
deals with compliance with laws and financial statutes and points out instances of extravagant and wasteful expenditure. Traditionally the focus of OAG's audit has focussed in these two areas.
However, today the scope of public accountability has grown beyond traditional horizons. Government's activities have expanded into social and economic sectors. A diverse range of economic and social programmes have been initiated with a view to achieving rapid economic growth and creating basic infrastructure in the fields of education, health, housing, agriculture and industry
In these circumstances it was no longer sufficient to merely testify the correctness of accounts and assure compliance with rules and procedures. It is necessary to safeguard the interests of the people by ensuring that funds have been spent economically, efficiently and effectively in attaining programme objectives.
Value-for Money Audit or Performance Audit is based on the concepts of economy, efficiency and effectiveness in analysing the operations of agencies and implementation of public programmes. The purpose of performance auditing is to assess and promote the effectiveness and efficiency of government and government-financed operations. It is intended to provide parliament, Government and its agencies with a basis for reappraisal, the reassessment of priorities and a review of existing operations aimed at achieving better resource utilisation.
Value-for Money Audit or performance audit, is today the most significant field of audit in Government Audit Institutions all over the world. The Supreme Audit Institutions in most of the countries have been switching their focus to Value-For-Money Auditing, which has become the most important instrument in ensuring Public Accountability.
Although financial and regularity audits have been existence for many years, VFM auditing is a relatively new form of auditing. OAG's goal is to integrate VFM auditing with other traditional types of audits. This would enable OAG to provide a better picture of the performance of the various public sector agencies.
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2.Does OAG have any affiliation to any international professional body?
OAG is a member of the INTOSAI and its regional grouping in Africa , AFROSAI. INTOSAI (International Organisation of Supreme Audit Institutions) is the professional organisation of Supreme Audit Institutions (SAIs i.e. national Audit Offices) in countries that belong to the United Nations or its specialised agencies. There is an international consensus that SAIs plays a major role in auditing government accounts and operations and in promoting sound financial management and accountability in governments in their respective countries.
INTOSAI supports its members in this task by providing opportunities to share information and experience about auditing and evaluation challenges facing them in today's changing and ever increasingly interdependent world, through organising training courses seminars and bringing guidelines and other publications related to Government audit.
Today INTOSAI comprises 185 member countries. Its LIMA declaration of guidelines of Auditing Precepts, adopted at the ninth International congress and recognised as the Magna Carta of government auditing, provides the philosophical and conceptual framework for INTOSAI's work. The Washington Congress of the INTOSAI 1992 adopted the two landmark publications: INTOSAI International Auditing Standards and Guidelines for Internal Controls Standards which are used by INTOSAI member countries .
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3.Is OAG's audit work governed by professional standards ?
The general framework of OAG's Audit is governed by INTOSAI Auditing Standards and also the of International Standards of Auditing formulated by the International Federation of Accountants (IFAC) . These describe the basic principles, which must be complied with whenever an audit is carried out for ensuring high quality in the audit work performed by OAG employees.
Audit is essentially a process of giving an opinion on the adequacy of the accounts and financial statements and critically evaluating efficiency and effectiveness of management systems and reporting the findings to concerned authorities.
Independence, integrity, objectivity and professional competence are the cornerstones of the Audit function. By its very nature Audit is a fairly complex process required to be performed by professionally qualified and trained personnel. Audit work is highly demanding in technical skills in accounting, Auditing and information technology and communication. Continuing professional education is an essential requirement for the OAG employees.
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4.What are the objective of Auditor General's Reports
Preparation and submission of Audit reports is the logical outcome of every audit. According to Article 163 of the Constitution, Auditor-General's reporting responsibilities are primarily directed towards providing the Parliament with information it needs to evaluate the performance of the Executive.
However, the Public Finance and Accountability Act also gives Auditor-General the responsibility to report to the Executive on any matter relating to management of Public Finances including any important irregularities revealed by audit.
The importance of the reports submitted by the Auditor-General to the Parliament and to the Executive cannot be over-emphasised. These summarise the findings of the Audits performed by the OAG and contain important and critical information for the parliamentarians and the Executive to act upon. Parliamentarians want relevant information on whether the objectives of specific programs and themes are being achieved or on how well the various Government agencies are doing.
The Parliament needs this information in order to assure itself on sound management of public finances and to hold the government agencies accountable for their actions .The executive needs Auditor-general's Report to take appropriate action on administrative lapses and deficiencies pointed out by Audit and to improve upon the existing systems.
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5.What is OAG's role in preventing fraud and corruption in the public sector?
As far as prevention of fraud and corruption is concerned , the three essential aspects of the impact of the work done by Auditor-General's Office (OAG) are prevention, detection and correction.
Audit is a periodic activity which critically examines the accounting records , financial statements and also the legality and regularity of actions and efficiency and effectiveness of performance of the audited entity. Thus audit itself is a major component of the control system in the administration which helps prevent financial and administrative irregularities. Thus efficient and effective audit is a check against weaknesses in internal control systems from arising. Audit therefore directly and indirectly prevents creation of conditions, which may give rise to fraud and corruption. This is the essence of the role of Public Sector audit.
While during the course of audit, many cases of financial irregularities, fraud etc., specially those having a material effect of the financial statements, are detected by audit and brought to the notice of the management. Propriety audit points out actions by management, which may be financially or administratively improper - thereby attracting attention to major instances of corruption. However, it needs to be emphasised that the objective of audit in not detecting fraud per se unless it is a special investigation. The main objective of public sector audit is to express an opinion on the fairness of the financial statements, ensure observance of rules and regulations and examine efficiency and effectiveness of operations.
The legislature and the executive are supposed to take action on the reports of Auditor-General, which point out general and specific causes of waste and inefficiency in public administration. The recommendations for improving the internal control systems and management practices made by Audit for the purpose of reducing the risks of fraud, corruption, inefficiency and wastage of public resources, if implemented by the management constitutes the corrective component of OAG's work.
From what has been stated previously , it would be apparent that the distinctive character of Auditor-General's work, is that in combating financial mismanagement, corruption, inefficiency, OAG has a proactive role. Whereas other enforcement agencies act in a reactive manner by carrying out investigations on specific allegations, presence of a strong and effective audit will reduce the scope of irregularities from taking place much in the same manner as a strong police force has a preventive effect on criminal activities. For this reason Audit has often been described as the watchdog of public moneys.
However , the modern concept of auditing goes beyond this preventive role to the assumption of a more proactive role . By virtue of this aspects of its role audit takes a wider perspective of the management practices and helps improving them through making of constructive evaluations and recommendations. This proactive role of audit as an aid to the administration rather than being content with a mere watchdog has gained wide acceptance not only in the private sector but in the public sector.
The OAG in the course of its business has the unique advantage of looking across a diverse range of public agencies and thus able to compare and analyse their performance and make recommendations regarding improvements in systems and performance. Audit can play a constructive role as an ally and aid to the administration. Audit can add value to public administration by pointing out areas of improvements in management systems, prescribing standards for financial control and suggesting codes of best practice.
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6.Where can I get copies of Auditor General's reports ?
You may get these reports from the Reports section of this web site . You may also contact us by email at
or visit us personally at our office at Treasury Building , Plot 2/4 , Treasury Building , Apollo Kagwa Road, Kampala .
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7.What internal management processes have been adopted by OAG to fulfil its mandate efficiently and effectively ?
The OAG has evolved a set of measures over the years to translate this mandate into practice and to discharge its role efficiently and effectively. The process of managing and controlling the audit work carried out every year begins with detailed planning. . Every year, the Auditor-General along with his senior management staff considers the audit portfolios mandated to be carried out and the manpower and other resources available to the Office within Budgetary allocations. Because of the limited resources available, audit program of work in respect of each public sector entity undergoes an analytical review and scoping of audit work concentrating on important areas.
The criteria by which this scoping is performed are the past experience, the outcome of previous audits, critical aspects of an activity to be examined, the degree of effectiveness of the Internal Controls in the entity, the overall audit risk, statutory requirements and many other allied matters.
The scoping is done in order to match the resources available to the program of audit work intended to be executed, so that audits are managed within the given resources, economically, effectively and efficiently.
The outcome of this process is the detailed Audit Plans for each of the Operational Divisions and Support Services. The operational Plan of each Division is then assigned to each Divisional chief to programme for execution by the staff under his control. The Audit Plan then becomes the responsibilities of the Divisional chief to schedule them in order of priority and mandays are allocated to this schedule for time-bound execution.
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8.How does OAG propose to cope with its ever increasing workload
The OAG has limited resources but a large number of public sector organisations and programmes are within its audit mandate.
Currently , steps are being taken to increase the efficiency and effectiveness of the professional staff through adoption of new audit methodologies and advanced auditing tools and techniques like risk based auditing and use of computer assisted techniques and computerisation of the audit management process with a view to empower OAG staff and management to do more with less resources .
According to the existing outsourcing policy , a part of OAG's work , mainly that relating to the audit of commercially run public enterprises and donor funded projects , are outsourced authorised professional auditing firms in Uganda . However the work of the appointed auditors is reviewed by OAG staff for the purpose of ensuring audit quality assurance .
9.What are major Management Challenges being faced by OAG management?
For OAG management the major challenge of the day is to upgrade its internal capabilities to provide value-added services and to achieve its strategic goals and objectives.
- The first major challenge before the OAG is to continue to improve and modernise its internal work processes on a continous basis .
- Second, OAG employees being its most important resource, improving the skills and knowledge of its personnel is a major challenge. To attain this objective training opportunities for OAG staff--from the senior executives to the new recruits are continuously being created . Apart from improving competency in the basic financial audit functions, the Auditor General has accorded high priority to the development of competencies in undertaking performance audits , special audit reviews and investigations and conducting audits in computerized environments has been accorded
- The third major management challenge is building an integrated and reliable Information Technology (IT) infrastructure that supports the achievement of the OAG's operations.
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10.What impact the computerisation of government financial management will have on OAG's work?
Currently Government of Uganda is implementing a computerised financial management and accounting sytem known as the Integrated Financial Management System (IFMS) . The IFMS is a very sophisticated online real-time system based on the well known software package Oracle Financials ' Treasury solutions. When it is fully operational, all Ministries and most Local Governments will be electronically linked to the IFMS and all transactions will be immediately updated in the central ledgers. Some characteristic features of such systems are absence of a visible audit trail (which is always present in a manual environment), complexity of internal controls and enhanced risks. These have serious repercussions on auditor's work. The auditing standards require that government auditors develop an understanding of the IFMS and learn to use its online audit facilities. IFMS will confer an additional audit responsibility to OAG. It is well known that IT systems are vulnerable to fraud, misuse and computer crime. As the IFMS will be critical to Governments operations, it would be necessary to assure IFMS' integrity, security and availability on an ongoing basis. OAG as the statutory external auditor will have to assume this responsibility. This however will imply that OAG staff collectively possess specialized skills.
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11.What steps are being taken to enhance the information technology capabilities of OAG?
A number of steps have been initiated in order to enhance OAG's IT capabilities and IT infrastructure . These include procurement of computers (laptops and desktop), establishment of a local area network and acquisition of audit management software. OAG staff are also being given training on using Computer Assisted Audit Techniques (CAATs) and generalised audit software IDEA and ACL. OAG staff has started applying these advanced auditing tools in performance of their audits.
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12.Does OAG get external financial assistance for capacity building ?
The Government of Uganda (GOU) has acquired an IDA credit which is being applied through the Second Economic and Financial Management Project (EFMP II) to improve public financial management. The principal focus of the project development objective is to improve the effectiveness of the public expenditure management processes with the goal to enhance the quantity and quality of public services in Uganda. Capacity building of the Office of the Auditor General is an integral component of EFMP II project. Currently a capacity building programme for OAG is being implemented under the EFMP II
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