International Journal of Government Auditing – January 2012
by Averil James-Bonnette, Secretary General of CAROSAI, and Alaistair Swarbrick, Auditor General of the Cayman Islands and Chair of the CAROSAI Institutional Strengthening Committee
The 21 members of the Caribbean Organization of Supreme Audit Institutions (CAROSAI) carry out their mandates against the background of rapidly changing environments and emerging accountability issues. Many face tremendous challenges in the areas of legislation and mandates, operations, budgets, methodologies, inactive Public Accounts Committees (PAC), and the failure to be recognized as fully independent organizations within the governance modality. Additional challenges arise in the CAROSAI region from the small size of the countries and their limited human and institutional capacities.
A brief look at the Cayman Islands, one of the CAROSAI members, will illustrate the broader issues facing governments and SAIs in the region. A British overseas territory with an area of only 151 square kilometers and a population of 55,700 in 2009, the Cayman Islands is one of the wealthier countries in the Caribbean. It has the world’s largest offshore banking sector and reported real GDP per capita of $42,605 in 2010.
However, the Cayman Islands’ government operations—and related governance, transparency, and accountability issues—have not kept pace with its wealth, GDP per capita, and status as a developed nation. The Office of the Auditor General (OAG) of the Cayman Islands experiences the same challenges as its counterparts in the less developed nations of the Caribbean. These challenges include the following.
Other fundamental issues related to institutional capacities plague almost all SAIs in the region. The INTOSAI Development Initiative (IDI), one of the major supporters of CAROSAI capacity-development initiatives, sponsored the Quality Assurance Review (QAR) program in 2010 and the Risk-Based Approach to Financial Auditing (RBAFA) program in November 2011 to help strengthen regional institutional capacity in those areas. The RBAFA and QAR programs were valuable initiatives, but the ability of individual SAIs to effectively implement these methodologies may be limited. Regional SAIs are in different phases of development and have varying audit approaches. Capacity, capability, and ultimately institutional strength are key issues that may impede implementation.
Another issue is the need for effective technical support for standards for financial auditing and accounting (as well as for performance and information technology auditing). In the CAROSAI region, it is difficult to get effective technical support and advice for small audit offices. The auditing and accounting standards have changed tremendously in recent years, and maintaining and acquiring knowledge on them is a challenge.
To address some of these issues that have been plaguing the region for some time, CAROSAI developed a regional strategic plan.
CAROSAI’s strategic plan for 2008–2011 has four goal areas.
Goal 1: Raise the profile of SAIs.
Goal 2: Assist member SAIs in strengthening their institutional capacity.
Goal 3: Help member SAIs develop their professional capacity.
Goal 4: Establish an effective information-sharing process.
Given the many challenges facing SAIs in the region, goal 1 of the strategic plan seeks to
To promote the achievement of this goal, CAROSAI received an institutional development grant from the World Bank in 2009 to strengthen fiduciary oversight in the Caribbean. The United Kingdom’s National Audit Office (NAO) was given the contract in 2010 to be the consultant for this project. The NAO delivered an initial report in June 2011 that outlined the delivery and approach for the project. The following are the main components of the project:
CAROSAI is currently implementing the grant at the regional level with a view toward applying the knowledge gained at the national level. It is also seeking to update its strategic plan for 2012–2015 to further strengthen the capacity of SAIs to promote and enhance public sector accountability in the region by creating a well resourced Secretariat.