International Journal of Auditing – October 2005

Accounting and Reporting Subcommittee

The Accounting and Report Subcommittee of the Professional Standards Committee, formerly the Accounting and Reporting Committee, is an official observer of the International Public Sector Accounting Standards Board (IPSASB) as it sets international public sector standards. The subcommittee has full floor rights at IPSASB meetings and represents the broad interests of the SAI community.

At its latest meeting, the IPSASB continued its debate on an exposure draft for the standard on revenue from nonexchange transactions. This is expected to be the first standard that deals with a unique government issue; it includes the accounting for tax revenues. The exposure draft is to be issued for comment by the end of 2005.

Another exposure draft under development addresses the reporting of budgetary information in general-purpose financial statements. Under this draft, both budget and actual amounts would be reported for comparison. This exposure draft should also be issued before the end of 2005.

The IPSASB is also continuing to develop an exposure draft on social-policy obligations accounting for programs such as old age pensions, social welfare, and other social services. There are complex accounting and conceptual issues related to these types of programs. One or more exposure drafts are expected to be issued for comment in 2006.

The subcommittee will keep the SAI community informed about IPSASB developments on an ongoing basis.

For additional information, contact: U.S. Government Accountability Office, fax: +(202) 512-4201; e-mail:

Subcommittee on Financial Audit Guidelines

With the establishment of the Professional Standards Committee (PSC), the INTOSAI Auditing Standards Committee became the PSC’s Subcommittee on Financial Audit Guidelines. The subcommittee holds two meetings each year. As reported in the July 2005 Journal, the SAI of Peru generously hosted the subcommittee’s first 2005 meeting in Lima on March 2-4. At that meeting, the terms of reference for experts working on practice notes were approved, as were the reporting format and procedures for the practice note process. After the Lima meeting, the subcommittee held a telephone conference on June 20 and approved a new work plan for 2005-2007. The subcommittee also provided comments to the International Auditing and Assurance Standards Board (IAASB) on the exposure drafts of International Standards on Auditing (ISA) 320, 540, and 600.

Reference Panel Meetings in Stockholm

Close to 60 different SAIs have nominated over 100 experts to the reference panel. This has enabled the subcommittee to make remarkable progress on developing financial audit guidelines for INTOSAI.

In February 2005, all reference panel members appointed as experts or back-office experts on ISA task forces and members of the panel’s focus group were invited to Stockholm. They exchanged experiences, discussed the development of practice notes, and provided suggestions for improving the process of developing INTOSAI financial audit guidelines. INTOSAI experts from Denmark, India, Italy, Malaysia, the Netherlands, New Zealand, Norway, Slovenia, South Africa, Sweden, the United Kingdom, and the United States took part in the meeting along with IAASB technical staff.

In June 2005, 16 members of the reference panel who were not yet appointed as experts or back-office experts were invited to Stockholm for a working meeting. They were introduced to the work with the guidelines and provided input on ongoing work. At that time, INTOSAI expert nominees from Colombia, the Czech Republic, Denmark, Ecuador, Finland, Greece, Hungary, Jordan, Lesotho, Nepal, the Netherlands, Norway, Saudi Arabia, Turkey, Tunisia, and the United Kingdom participated in the meeting along with IAASB technical staff.

Information on Ongoing Work

In each issue of the Journal, the subcommittee Project Secretariat offers a brief update on the ongoing work with ISA task forces. The Web site of the International Federation of Accountants ( provides updated information on the ISA task forces, exposure drafts of ISAs, and related matters. The subcommittee’s Web site ( offers current information on such topics as work with the guidelines and the approved minutes from committee and working group meetings.

Work is in progress on the following ISAs where INTOSAI experts are involved:

ISA 230 – Documentation
Expert: Ms. Kelly Ånerud, Norway Back-office experts: Mr. John Fretwell, United States; Mr. Inge Danielsson, Sweden Final version expected in September 2005 and Practice Note expected in June 2006

ISA 705 – Modifications to the Opinion in the Independent Auditor’s
Report and ISA 706 – Emphasis of Matter Paragraphs and Other Matters
Paragraphs in the Independent Auditor’s Report

Expert: Vacant Back-office experts: Ms. Marcia Buchanan, United States; Ms. Mary Radford, United Kingdom Final version expected in March 2006 and Practice Note expected in December 2006

ISA 260 – Communications with Those Charged with Governance
Expert: Ms. Tove Myklebust, Norway Back-office experts: Mr. Filip Cassel, Sweden; Mr. John Fretwell, United States Final version expected in March 2006 and Practice Note expected in December 2006

ISA 800 – The Independent Auditor’s Report on Special Purpose Audit Engagements
Expert: Mr. Jonas Hällström, Sweden Back-office experts: Mr. Demsash Betemariam, Ethiopia; Mr. Martin Dees, the Netherlands; and Mr. Robert Cox, New Zealand Final version expected in March 2006 and Practice Note expected in December 2006

ISA 550 – Related Parties
Expert: Mr. John Thorpe, United Kingdom Back-office experts: Ms. Zainun Taib, Malaysia; Mr. Uwe Schreiner, Germany; and Ms. Goranka Kiralj, Slovenia Final version expected in June 2006 and Practice Note expected in March 2007.

ISA 580 – Management Representation
Expert: Ms. Vijaya Moorthy, India Back-office experts: Mr. Martin Garrido, Chile; Mr. Ennio Colasanti, Italy Final version expected in September 2006 and Practice Note expected in June 2007

ISA 620 – Using the Work of an Expert
Expert: Ms. Cláudio Branco, Brazil Back-office experts: Mr. András Morvay, Hungary; Monica Besetsa, Lesotho Final version expected in December 2006 and Practice Note expected in September 2007

In addition, the subcommittee is charged with developing practice notes for each ISA to provide additional guidance that auditors in the public sector may need to apply to the ISA. The practice notes will be based on the contributions of the audit experts from the reference panel.

Practice notes will also be developed for ISAs already approved at the time the reference panel was created or where no expert participated in the IAASB task force. The Project Secretariat is currently forming task forces with experts and back-office experts from the reference panel to develop practice notes for these ISAs.

Work Ahead

Before the end of the year, the heads of all INTOSAI SAIs will receive a letter from the subcommittee chair asking them to nominate experts and to reconfirm their commitment regarding the experts that are already a part of the reference panel.

Funding the Project

The project entirely relies on the contributions by the experts and their respective SAIs, who have agreed to cover the costs. The Project Secretariat is continuously approaching external parties to seek external funds. The project has so far been granted funding from the World Bank and the Asian Development Bank. These funds will, among other things, cover the costs for reference panel meetings, certain WGFA meeting expenses, the running of the Project Secretariat, translations of standards and guidelines into the official INTOSAI languages, and printing and distributing of approved guidelines.

For further information, please contact the Project Secretariat, fax: ++46-8-5171 4111; e-mail:; Web site:

Committee on IT Audit

The 14th meeting of the INTOSAI Standing Committee on IT Audit was held at Paro, Bhutan, April 27-29, 2005. Attending the meeting were 48 delegates and 10 observers from 23 member countries and the INTOSAI Development Initiative.

On April 26, 2005, the district head of Paro, Dasho Lam Dorji, hosted a dinner in
honor of the delegates. For the opening ceremony, His Excellency Lyonpo Khandu Wangchuk, Bhutan’s Minister for Foreign Affairs, was the chief guest. Other senior officers from the Royal Government of Bhutan also attended.

During the meeting, delegates updated the group on initiatives from the previous
meeting, including issues related to the committee Web site, measures taken to counter fraud in the IT environment, INTOSAI IT audit courseware and advanced training modules, and computer-assisted audit techniques (CAATS) for non-financial auditing. Delegates also discussed ongoing projects on auditing e-government, a proposed survey for future projects, and the use of modern technology in INTOSAI’s decision-making.

Several SAIs presented country papers on topics such as computerized audit systems and the results of the first work period (2002-2005) of the EUROSAI IT working group. In addition, IDI discussed cooperative training matters. The committee decided that its 15th and 16th meetings will be held in Brazil and Oman, respectively.

Attendees of the IT audit committee meeting outside the National Assembly Hall of Bhutan.

In addition to the professional discussions, the delegates and observers visited Thimphu, the capital of Bhutan, and were taken on a trekking trip to Paro Taktsang (the Tiger Nest Monastery). For additional information, contact: Chair, Committee on IT Audit, Principal Director International Relations, Office of the Comptroller and Auditor General of India, fax: ++91 (11) 2323; e-mail:; Web site:

Public Debt Committee

The INTOSAI Public Debt Committee met in Sofia, Bulgaria, June 2-3, 2005, to plan future activities in its successful joint training program with IDI and regional INTOSAI associations. Committee members also discussed potential themes for the next Congress of INTOSAI in 2007 in Mexico City and two surveys on laws applicable to public debt and reporting on contingencies.

The program started in 2003 with intensive 2-week public debt auditing workshops in Spanish for SAIs in the OLACEFS region. More than 70 auditors were trained to conduct public debt audits in their countries. In 2004, ASOSAI instructors delivered the first workshop in English for 31 SAI members in Asia, the Pacific, and the Middle East. Before the delivery of the course in Canberra, Australia, IDI-trained instructors from Bangladesh, Bhutan, China, India, Indonesia, Nepal, and Vietnam produced course materials in English with the support of a subject matter expert from the U.S. Government Accountability Office. IDI plans to deliver a public debt auditing workshop for Russian-speaking SAIs in the near future. IDI will also distribute the English version of the course among other interested SAIs.

At the meeting in Sofia, Arturo Gonzalez de Aragon, Chairman of the Public Debt Committee, stressed the importance of having a theme related to public debt as part of the technical discussions at the 2007 INCOSAI in Mexico. After considering a number of themes that could be proposed at the 54th INTOSAI Governing Board meeting, the committee members agreed on the following—theme: public debt, with sub-themes (1) public debt management and (2) accountability and auditing of public debt.

The Public Debt Committee will meet again in 2006 in Buenos Aires, Argentina.

For additional information, contact: Public Debt Committee, e-mail:; Web site:; or INTOSAI Development Initiative, e-mail:; Web site:

Changes in CAROSAI

A new era began in CAROSAI on September 1, 2005, when the SAI of Saint Lucia assumed the General Secretariat. Since CAROSAI’s inauguration in 1988, the Secretariat had been located within the Auditor General’s Department of the SAI of Trinidad and Tobago. While Trinidad and Tobago considered it an honor to house the Secretariat for the past 17 years, it has now passed this leadership role to Saint Lucia. This decision was approved at the VI CAROSAI Congress held in Bermuda in August 2003, and the Government of Saint Lucia was granted formal approval by the Cabinet Conclusion dated August 30, 2004.

All correspondence regarding CAROSAI should be addressed to Mrs. Arlette Hyacinth, Director of Audit, Office of the Director of Audit, Conway Business Center, Level 3, Jn Baptiste Street, Castries, Waterfront, Saint Lucia; telephone: ++1-758-468-1501, -1508, or -1510; fax: ++1-158-468-1534; e-mail:

18th UN/INTOSAI Seminar in Vienna

From April 18-22, 2005, the United Nations (UN) and INTOSAI hosted a joint symposium, The Use of Information and Communication Technologies in the Audit of e-Government: A Strategy for Efficiency, Transparency and Accountability. The symposium was held at the Vienna International Center, the UN’s seat in Vienna. About 60 delegates, primarily heads of SAIs, attended the event. Speakers came from the UN, the World Bank, and the SAIs of Argentina, Canada, India, Oman, South Africa, and Austria. A representative of the United Kingdom National Audit Office served as technical chair.

Participants in 18th UN/INTOSAI Seminar in Vienna
Participants in 18th UN/INTOSAI Seminar in Vienna

During the seminar, participants held in-depth discussions on the following topics:

  • the legal framework and audit mandate for e-government audit,
  • the current status and future aspects of e-government,
  • risks in the field of e-government,
  • online audits of e-government,
  • challenges when auditing e-government, and
  • electronic procurement.

The SAIs of Algeria, Bhutan, Bolivia, Chile, Denmark, the Dominican Republic, Ethiopia, Fiji, Israel, Jamaica, Japan, Kuwait, Lesotho, Libya, Lithuania, Malawi, Mongolia, Namibia, the Netherlands, Tunisia, and Venezuela reported on the use of information and communication technologies in e-government audits in their countries. Seminar participants provided valuable insights about the organization of their SAIs and exchanged information on future trends and the potential for improving their SAIs’ audits of e-government.

Following the keynote speeches, discussions enabled participants to exchange ideas and identify key aspects of e-government audits. Several working groups at the symposium afforded participants a smaller forum for sharing their experiences and the opportunity to address issues raised during the discussions in greater detail and to arrive at conclusions and recommendations.

Specifically, seminar participants concluded the following:

  • SAIs should take on a proactive role in e-government to promote increased transparency and improved services for citizens.
  • Governments should elaborate e-government strategies that are subject to SAI audit.
  • Auditors should receive the education and training necessary to meet the requirements of e-government audits.
  • SAIs should launch a broad-based exchange of experiences and a process of mutual learning in the area of auditing e-government.
  • The role of SAIs in auditing government financial management should be enhanced.

Participants also discussed the need for sufficient funding as well as audit-related methodological skills and expertise if SAIs are to carry out their statutory audit mandates most effectively.

Upon completion, the report on the 18th UN/INTOSAI seminar will be available on the INTOSAI Web site.

For additional information, contact: INTOSAI Secretariat, fax: ++43 (1) 718 09 69; e-mail:; Web site: