Inside INTOSAI

International Journal of Auditing – January 2003

Governing Board Charts Dynamic Course at 50th Meeting

Governing Board members in Vienna
Governing Board members in Vienna

INTOSAI’s Governing Board convened in Vienna, Austria, for its 50th meeting and took a number of decisions to position INTOSAI to effectively address the many challenges facing the organization and its member SAIs. The following Board member countries engaged in lively discussion and debate during the 2-day meeting on October 16-17, 2002: Korea (chairman), Hungary (first vice-chairman), Saudi Arabia (second vice-chairman), Austria (general secretary), Antigua and Barbuda, Brazil, Burkina Faso, Egypt, India, Japan, Norway, Peru, Portugal, Tonga, Tunisia, the United Kingdom and the United States. Joining in as observers and reporting on their committees’ progress were the SAIs of Canada, Sweden, Mexico, France and Belgium; the European Court of Auditors also sent three observers.

Among the Many Important Decisions Taken by the Board

1. Admission of the newly created SAI of Cambodia as INTOSAI’s newest member, bringing total worldwide membership to 185 countries.

2. Creation of a task force on money laundering that will explore the SAI’s role in helping prevent and detect money laundering on an international basis. The first meeting of the task force—which was initially proposed by the auditor general of Russia at the 2002 Seoul INTOSAI congress—is tentatively scheduled to be held in St. Petersburg, Russia, in late July 2003.

3. Elimination of the US$5 subscription fee for the International Journal of Government
Auditing and the introduction of electronic distribution of the Journal as a way to more efficiently reach a wider audience. The Journal will continue to be printed and distributed in hard copy as well.

4. Selection of themes for the 2004 INTOSAI congress to be held in Budapest. Theme I will address the subject of bilateral and multilateral cooperation among SAIs in the areas of joint audits, training and capacity building, and knowledge sharing; theme chair is the National Audit Office of the United Kingdom. Theme II will address the subject of coordination of audit efforts among national, regional, local and self-governing bodies; theme chair is the Office of the Auditor General of Canada.

5. Acceptance of Mexico’s offer to host the 2007 congress.

6. Endorsement of the auditing standards committee’s proposal to engage with the International Federation of Accountants work in revising international auditing standards and to solicit funding from the World Bank to support this work. As the Journal goes to press, indications are that the Bank is inclined to provide funding for the committee’s work!

7. Adoption of the Strategic Planning Task Force report including the proposed INTOSAI strategic planning framework.

Full reports on INTOSAI’s numerous committees, task forces and other programs are available by contacting the relevant SAI chairs or the General Secretariat:

Mutual Experience Benefits All: INTOSAI Strategic Plan 2004 to 2009

In addition, more detailed information on new developments related to INTOSAI’s auditing standards collaboration with the International Federation of Accountants and INTOSAI’s strategic planning framework are highlighted below. Comments on the strategic planning framework are being solicited from SAIs and other interested parties; comments should be sent by e-mail to niemic@gao.gov or by fax 1-202-512-4021 no later than March 1, 2003.

Update on INTOSAI Auditing Standards

During the INTOSAI Governing Board meeting held in Vienna in October 2002, the Auditing Standards Committee (ASC) presented the progress it has made on the tasks assigned to it at the XVII INCOSAI in Seoul. Until 2004, the ASC’s primary projects are to develop Implementation Guidelines for Performance Audit (an exposure draft was sent to all INTOSAI members in December, and the guidelines are posted on the Web sites of INTOSAI and the Swedish National Audit Office);

  • conduct a survey in 2003 in cooperation with the Subcommittee on Independence;
  • develop a web-based bibliography;
  • create an ASC Web site; and
  • develop Implementation Guidelines for Financial Audit.

Development of Financial Audit Guidelines

In accordance with mandates received at the Montevideo and Seoul INCOSAIs (in 1998 and 2001, respectively), the ASC is to implement and lead the work of producing guidelines for financial auditing that will provide in-depth guidance on the INTOSAI Auditing Standards. These guidelines will add a fourth level to the existing hierarchy of INTOSAI standards (the Lima Declaration, the Code of Ethics, and the Auditing Standards). The International Federation of Accountants’ (IFAC) existing internationally accepted standards (ISA) are to be used in the project.

With the aid of experts from SAIs (both from the ASC and INTOSAI at large), the ASC is to participate in the work of IFAC’s International Auditing and Assurance Standards Board (IAASB) and its working groups to help ensure that to the greatest extent possible, the standards being developed there take into consideration the specific conditions of public sector audits. When necessary, the ASC is to produce practice notes to clarify how the ISA can be applied in the public sector. The ASC is also to write new guidelines in areas not covered by IFAC. An INTOSAI guideline will consist of the ISA and the practice note or a new guideline written by the ASC.

Project Structure

The Governing Board approved the ASC’s proposal for a work plan and project structure to implement guidelines for financial audit. The ASC is currently working on setting up the project structure, which will include: a Working Group, a Project Secretariat and a Reference Panel.

The Swedish National Audit Office leads the working group, whose other members are the SAIs in Austria, Canada, Cameroon, Namibia, Norway, the United Kingdom and the United States. The working group is to produce proposals for guidelines on the ASC’s behalf.

The reference panel will consist of 25-30 experts from INTOSAI’s member organizations who will contribute professional expertise and safeguard the public sector perspective in IFAC’s working groups. The ASC will contact INTOSAI members during the coming year to ask some SAIs to make experts available to participate in this work.

To provide support for the working group, its chairman has appointed a Project Director—Ms. Karin Holmerin, Audit Director in the Swedish National Audit Office and a Certified Accountant—who, together with other staff members, forms a project secretariat. This secretariat works on behalf of the working group chairman and is responsible for the practical coordination and preparation of the work in the working group and the reference panel.

Future Work

IFAC is reviewing existing ISAs, as well as writing new ones as needed. Exposure drafts are published on the IFAC web site: http://www.ifac.org.

Based on IFAC’s current work plan, the ASC Working Group will prioritize the appropriate IFAC working groups to participate in and contribute to.

The ASC hopes to report on the first guidelines for the Governing Board’s approval in October 2003 and will ask that INCOSAI endorse those guidelines by 2004.