International Journal of Government Auditing – January 2014
Liu Jiayi: Good national governance and security are the common aspirations of people around the world and constitute a shared mission of all SAIs. Today, as economic globalization develops in depth, global issues—climate change, energy and resources security, economic security, environmental security, food security, government honesty and efficiency, and anti-corruption efforts—have become more acute, posing higher requirements for, and new challenges to, SAIs. The greatest challenge of all, I believe, is to promote and serve good national governance.
First, since this new era of development assumes an increasingly important role in national governance, it calls for the continuous deepening of the functions of national audit. As a vital force in maintaining democracy and the rule of law, national audit plays a crucial role in enhancing government efficiency, advancing clean administration, safeguarding national security, and improving people's livelihood. However, audit institutions are presently constrained in their guiding ideas, approaches, and impacts to fully meet the needs of good national governance.
Second, this new era of transformation cries for expansion of the scope of audit. In the context of a world afflicted by financial crisis, countries are exploring and seeking new ways of development. Changing situations, measures, and demands require SAIs to keep pace with the times. It will become normal for SAIs to constantly embrace new challenges, make changes, and take proactive measures to push forward good national governance.
Third, this new endeavor encourages the development of national audit theories. Research on theories of national audit promoting and serving national governance should be deepened, as there is no ripe experience from which to draw lessons. In practice, theories of audit need to be enriched by exploring its mechanisms, core content, path of realization, and approaches to evaluation.
Opportunities always go hand in hand with challenges. To address the challenges cited above, we need to take innovative approaches in our audit work and create a sound environment for economic development, which would, in turn, offer new opportunities for SAIs to play a more visible role in promoting their national interests. SAIs can help make government accountable for using public resources by disclosing violations and malpractice and promoting accountability and transparency. SAIs can enable regular distribution and utilization of public resources by carrying out audits in related areas. In coping with financial deficits and the public debt crisis, SAIs can, by focusing on the overall or systemic factors that gravely affect policy implementation and long-term financial stability, contribute to the formulation of sound public financial and monetary policies. In dealing with climate change, energy and resources security issues, and environmental crisis, SAIs can provide objective information, disclose existing problems, and provide recommendations for improvement.
The important position and role of national audit in promoting and improving good national governance are best demonstrated in its effective addressing and defusing of various crises. At present and in the future, SAIs should—in line with the concept of "national audit serving national governance"—grasp this primary opportunity, earnestly fulfill their audit responsibilities, and intensify capacity building. This will enable them to play a greater role in promoting the long-term sustainability of financial policies, improving national governance, actively participating in high-level governance globally, and realizing, in particular, the United Nations Millennium Development Goals.
Terrence Nombembe: I believe there are many more opportunities than challenges confronting SAIs today. One of the primary opportunities for SAIs is to build on the great strides we have already made in consolidating cooperation within INTOSAI— both among its various structures and among individual SAIs—as well as with our partner organizations and key stakeholders. We need to sustain this momentum by continuing the cooperation among individual SAIs and between INTOSAI regions, utilizing our different strengths and sharing our respective innovations to the benefit of all. While it is incumbent upon the stronger SAIs to do more to support and uplift their more vulnerable counterparts, less privileged SAIs should realize that they, too, can greatly support each other through the exchange of knowledge.
SAIs also have the opportunity to continue to respond to humanity’s great need for truth, honesty, and integrity. By increasingly demonstrating our impact as a credible voice of reason, public auditors will enhance transparency and ensure accountability and will help governments improve performance, fight corruption, promote public trust, and protect the interests of the citizens they serve. The ISSAIs provide a world-class set of standards that ensures the credibility of our work. The ISSAIs are complemented by INTOSAI’s strategic plan as well as numerous other guidelines that enable SAIs to respond confidently to challenges facing the public sector. As we continue to strive for excellence in every aspect of our work, all SAIs, as part of their professionalization, must take advantage of the opportunity offered by the ISSAI framework and swiftly implement these standards. SAIs should also persist with extensive training to maintain their supremacy in the public sector audit environment. Such training will equip SAI staff with the powers of independent thought and analysis and the ability to forge a route to audit excellence for all INTOSAI regions.
Liu Jiayi: INTOSAI should face up to the impacts of globalization on SAIs, identify expectations of stakeholders, and assess and address multiple challenges. In representing SAIs in the international arena, INTOSAI should consider providing a unified voice on trans-boundary and international issues, thus putting its role as an important part of the public sector accountability and global governance system into full play.
INTOSAI should do the following:
Terrence Nombembe: Establishing the Standing Supervisory Committee on Emerging Issues is a clear indication of INTOSAI’s intention to expand its value-adding role to the global stage. It is an acknowledgement of INTOSAI’s intention to positively and proactively influence the direction of global trends and to advance to a position where global public sector insights can be shared with public sector stakeholders to enhance transparency, accountability, and good governance.
The efforts of INTOSAI can only succeed, however, if we make an effort to participate in influential global forums and their key discussions. INTOSAI is a highly respected organization, filled with people with highly developed technical skills and wide experience. For INTOSAI to respond to global changes and challenges, its leaders need to be visible on global platforms carefully identified for optimum impact. Although it is important and relatively easy for INTOSAI to be monitoring key global developments, INTOSAI has to be able to impact such development by engaging with forums identified as relevant in directing global trends.
We have the opportunity to consolidate our existing networks, which have historically been proven to be invaluable in directing global trends. In this context I am referring to bodies such as the International Federation of Accountants, Institute of Internal Auditors, United Nations, Organization for Economic Cooperation and Development, and our key donor partners, with whom we have established a high level of credibility and authority on matters of standard setting as well as the implementation of such standards and frameworks.
In keeping with the spirit of the 22nd UN/INTOSAI Symposium, which recognized and elevated the role of SAIs as dependable advisors, INTOSAI can extend this role beyond our SAI-specific territory to forums where those we advise can meet with their global partners to influence world events and trends. These forums would include the G8, G20, and BRICS forums; the World Economic Forum; high-level development forums; and key regional forums.
I am greatly appreciative that INTOSAI has advanced this far by establishing the Standing Supervisory Committee on Emerging Issues. It is important that it has been established at the appropriate level of authority by having it chaired by the President of INTOSAI. I have no doubt that in the next three years Mr. Liu Jiayi and the Supervisory Committee, supported by the regional leadership in INTOSAI, will, by demonstrating mature leadership, tact, and strategic influence, respond to global changes as the independent voice of reason at global levels of governance.
Liu Jiayi: As an umbrella organization for SAIs, as well as the key hub of and major decision-making platform for information exchange, technical cooperation, and training and seminars in the field of national audit worldwide, INTOSAI plays a positive role in both promoting the independence of SAIs and fostering collaboration with those partners charged with the responsibility of good governance.
INTOSAI has taken the following measures to promote the independence of SAIs:
Terrence Nombembe: (a) The adoption of UN Resolution A/66/209 was a momentous milestone in the history of INTOSAI and the global public sector. SAI independence enables an SAI to adapt to any situation and to apply this noble and powerful privilege to demonstrate our relevance and our benefit to society. I have, on a number of occasions, stated my belief that SAIs can grow to be the preeminent voice of reason in our respective countries and in the global public sector, provided that we never become complacent about the underlying principles and values of the Lima and the Mexico Declarations. However, much remains to be done to ensure that all SAIs attain full independence.
To this end, INTOSAI—especially its regional structures—will continue to use every platform available to promote the doctrine of independence. I believe, though, that individual SAIs need to do more to support and encourage one another as they strive to successfully complete the journey to full independence.
(b) With regard to fostering collaboration with those partners charged with governance, INTOSAI has, through the adoption of ISSAI 12 in Beijing last fall, recognized the value of ongoing, structured communication and of stakeholder engagement. This ISSAI urges SAIs to build partnerships that will enable those charged with public sector governance to discharge their responsibilities in responding to audit findings and recommendations, to take appropriate corrective action in order to strengthen service delivery to citizens, and to build public confidence.
SAIs must use their unique privilege of engaging with their country’s government leaders to create conditions that consistently produce credible information related to the stewardship of public funds, delivery of services to citizens, and respect for the rule of law in managing state resources.
For SAIs to achieve optimal value from these partnerships, we must have continuous, systematic, and structured processes through which we will build a reputation of responsive institutions, ones that develop professional relationships with relevant legislative oversight committees, executive authorities, and management of audited entities. Audit standards clearly define the conditions and interventions that we should use in order to create a successful relationship with those charged with governance.
This will require persistence, persuasion, and humility on our side as SAIs, but it is a journey that is certainly worthwhile, one that is in our interest and even more so, in the interest of those we ultimately serve—the citizens.
Liu Jiayi: As another major document that “summarizes history, meets challenges and builds consensus,” after the Lima and Mexico Declarations, the Beijing Declaration on Promotion of Good Governance by Supreme Audit Institutions will, I believe, have a profound and far-reaching influence on ensuring the independence of individual SAIs and the roles played by SAIs in promoting national good governance, safeguarding the long-term sustainability of financial policies, and ensuring good governance globally.
First, the Beijing Declaration includes major achievements and experience obtained by INTOSAI since its official establishment 60 years ago and reaffirms the guiding principles embodied in the Lima and Mexico Declarations and UN Resolution A/66/209, particularly the basic rules for national audit and the principle of independence. Standing for all individual SAIs, it calls for the implementation of these principles by each legislature and government body.
Second, the Beijing Declaration identifies the promotion of good national governance and global governance as the common goal of all SAIs and develops mandates of SAIs from a future-oriented perspective. In accordance with the Beijing Declaration, SAIs, as an indispensable part of national governance, should propose constructive recommendations to decision-makers in order to uphold democracy and the rule of law, increase the efficiency of government, prevent and combat corruption, ensure national security, promote people’s livelihood, strengthen transparency and accountability, and build SAIs into trustworthy, honest, and model organizations of integrity. The Beijing Declaration appeals to individual SAIs to shoulder our shared responsibilities, resist common risks, take joint actions, and speak with one voice. By enhancing international cooperation and playing a vital role in finding solutions to the major challenges confronting the world today—such as crises related to the sovereign debt, ecology, global financial security, and anti-corruption— we can encourage individual governments to fulfill their obligations through auditing such areas as tackling climate change, eliminating trade barriers, ensuring financial sustainability and encouraging anti-money laundering efforts. SAIs can also promote accountability, transparency, and better performance in order to ensure a smooth development of the world economy. This goal can be achieved by participating in governance activities such as evaluating social progress, by conducting external audit of international and regional organizations, and by contributing to the fulfillment of tasks defined in the United Nations Millennium Declaration—consulting with multilateral organs such as the UN, World Bank, G20, and OECD, and engaging in continuous improvements of global governance.
Third, faced with the financial and economic crisis plaguing the world at the beginning of the 21st century, the Beijing Declaration calls for all SAIs, in light of their national conditions and legal mandates, to carry out independent and strict audit on government accounting statements and public debt to safeguard the long- and mid-term sustainability of financial policies, ensure the public interest, and promote social and economic development. The Beijing Declaration also calls for individual SAIs to improve their mandates so as to conduct audits on the sustainability of financial policies.
Finally, the Beijing Declaration calls upon member SAIs, in compliance with the strategic plan of INTOSAI, to enhance capacity building and knowledge sharing, to establish and observe the ISSAIs, and, based on the above, to maintain independence and improve performance to build INTOSAI into a model organization. The XXI INTOSAI endorsed the work theme for 2014 as “implementation of the Beijing Declaration, especially of the UN General Assembly Resolution A/66/209 Resolution on strengthening the independence of supreme audit institutions and the framework of ISSAIs to ensure sustainable development of public finances.” This has further highlighted the significance of the Beijing Declaration.
Terrence Nombembe: The Beijing Declaration confirms that INTOSAI now fully embraces the principles of the value and benefits of SAIs and sets a tone that inspires all SAIs to remain firmly committed to strengthening the accountability, integrity, and transparency of the governments we audit. The Declaration motivates us to sustain our relevance and responsiveness to citizens and to all oversight bodies that hold our governments to account, while continuing to build and sustain model organizations that lead by example, so that we can be respected by those placing reliance on our work. It is now up to us as individual SAIs to put measures in place to ensure alignment with the objectives and principles contained in ISSAI 12 and to prepare to be measured in terms of the SAI performance measurement framework being piloted in INTOSAI.
The Beijing Declaration also recognizes the important role that SAIs can play in strengthening national governance. Public sector auditing should increase government’s efficient, effective, economic, and equitable use of public resources, thereby creating a basis for sustainable development, ensuring a “life of dignity” for citizens, and promoting the improvement of people’s livelihood. I would like to challenge SAIs to ensure that they are strategically positioned to fulfill this honorable role with excellence. This should include adopting and implementing the full ISSAI framework, especially the ISSAIs adopted at the XXI INCOSAI; ensuring continued and well-coordinated capacity-building activities in all audit disciplines in the SAI, including making full use of the support available in INTOSAI, its regional secretariats, and individual SAIs; and increasing public sector knowledge-sharing within the SAI, including developing capabilities to respond to fiscal and economic challenges, to ensure the SAI remains relevant.
In conclusion, I wish to remind us all as SAIs that our role is to bring hope to the citizens of the world. I am confident that if we continue in the direction in which we set out 60 years ago—a direction confirmed and refined in Beijing—we as SAIs will indeed bring hope to the citizens of the world.
As INTOSAI, it is our time to shine, and we shall indeed shine.