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International Journal of Government Auditing:

January 2004:

Vol. 31, No. 1:

©2004 International Journal of Government Auditing, Inc.

The International Journal of Government Auditing is published quarterly 
(January, April, July, October) in Arabic, English, French, German, and 
Spanish on behalf of INTOSAI (International Organization of Supreme 
Audit Institutions). The Journal, which is the official organ of 
INTOSAI, is dedicated to the advancement of government auditing 
procedures and techniques. Opinions and beliefs expressed are those of 
editors or individual contributors and do not necessarily reflect the 
views or policies of the organization.

The editors invite submissions of articles, special reports, and news 
items, which should be sent to the editorial offices at U.S. General 
Accounting Office, Room 7814, 441 G Street, NW, Washington, D.C. 20548, 
U.S.A. (phone: 202-512-4707; facsimile: 202-512-4021; e-mail:

Given the Journal's use as a teaching tool, articles most likely to be 
accepted are those which deal with pragmatic aspects of public sector 
auditing. These include case studies, ideas on new audit methodologies 
or details on audit training programs. Articles that deal primarily 
with theory would not be appropriate.

The Journal is distributed to INTOSAI members and other interested 
parties at no cost. It is also available electronically at and by contacting the Journal at

Articles in the Journal are indexed in the Accountants' Index published 
by the American Institute of Certified Public Accountants and included 
in Management Contents. Selected articles are included in abstracts 
published by Anbar Management Services, Wembley, England, and 
University Microfilms International, Ann Arbor, Michigan, U.S.A.



News in Brief:

Accrual Budgeting and Accounting:

Ninth ASOSAI Assembly:

XIII OLACEFS General Assembly:

Audit Profile: Papua New Guinea:

Reports in Print:


IDI Update:

INTOSAI Calendar:

[End of Contents]

Board of Editors:

Franz Fiedler, President, Court of Audit, Austria;

Sheila Fraser, Auditor General, Canada;

Mohamed Raouf Najar, Premier Président, Cour des Comptes, Tunisia;

David M. Walker, Comptroller General, United States;

Clodosbaldo Russian Uzcategui, Comptroller General, Venezuela;


Helen H. Hsing (U.S.A.)


Donald R. Drach (U.S.A.)

Assistant Editors:

Linda J. Sellevaag (U.S.A.)

Alberta E. Ellison (U.S.A.)

Associate Editors:

Office of the Auditor General (Canada);

Deepak Narain (ASOSAI-India);

Luseane Sikalu (SPASAI-Tonga);

Michael C.G. Paynter (CAROSAI-Trinidad and Tobago);

EUROSAI General Secretariat (Spain);

Khemais Hosni (Tunisia);

Yadira Espinoza Moreno (Venezuela);

INTOSAI General Secretariat (Austria);

U.S. General Accounting Office (U.S.A.)


Sebrina Chase (U.S.A.)

Members of the Governing Board of INTOSAI:

Yun-Churl Jeon, Chairman, Board of Audit and Inspection, Korea, 

Arpád Kovács, President, Allami Számvevöszék, Hungary, First Vice-

Osama Jaffer Faqeeh, President, General Auditing Bureau, Saudi Arabia, 
Second Vice-Chairman;

Franz Fiedler, President, Rechnungshof, Austria, Secretary General;

Arah Armstrong, Director of Audit, Audit Department, Antigua and 

Valmir Campelo, Ministro, Presidente do Tribunal de Contas da Uniăo, 

Leopold A.J. Ouedraogo, Inspecteur Général d'Etat, Burkina Faso;

Mohamed Gawdat Ahmed El-Malt, President, Central Auditing Organization, 

Vijayendra N Kaul, Comptroller and Auditor General, India;

Tsutomu Sugiura, President of the Board of Audit, Japan;

Bjarne Mřrk Eidem, Auditor General, Riksrevisjonen, Norway;

Genaro Matute Mejía, Contralor General, Contraloría General, Peru;

Alfredo José de Sousa, President, Tribunal de Contas, Portugal;

Pohiva Tu'i'onetoa, Auditor General, Audit Department, Tonga;

Mohamed Raouf Najar, Premier Président, Cour des Comptes, Tunisia;

Sir John Bourn, Comptroller and Auditor General, National Audit Office, 
United Kingdom;

David M. Walker, Comptroller General, General Accounting Office, United 

Guillermo Ramírez, President, Tribunal de Cuentas, Uruguay;

Accountability Begins at Home:


In recent days, I led a strategic forum within the World Bank, 
brainstormed what it takes to manage for results with fellow heads of 
multilateral development banks, joined the deliberations of 
Organization for Economic Cooperation and Development (OECD) finance 
ministers laying the groundwork for a G-8 summit meeting in June 2004, 
and traded observations on challenges to development and peace with a 
group of parliamentarians from around the world.

No matter the audience, no matter the venue, everyone has the same 
hope: building a better life for our children and for all children. But 
the question is, How do we go about it? How do we make every penny 
count? How do we scale up our efforts to serve millions over time? How 
do we ensure leadership, partnership, and inclusion?

The Importance of SAIs:

Financial accountability is a necessary condition for efficient public 
management and hence for the management of funds in favor of poverty 
reduction, health and education, a clean environment, and peace.

Over the last decade, the development community has come to understand 
the importance of public financial management for reaching the 
Millennium Development Goals, as well as the need for accountability 
systems that perform well in client countries. At the same time, donors 
realize that for development impact to be sustainable, they must depend 
on these national systems, rather than impose separate systems of their 
own. [NOTE 1]

Effective supreme audit institutions are a key element of such systems. 
As the Lima Declaration states, they seek "the proper and effective use 
of public funds; the development of sound financial management; the 
proper execution of administrative activities; and the communication of 
information to public authorities and the general public through the 
publication of objective reports."

The World Bank-SAI Partnership:

The World Bank is at the forefront of support for and mutually 
beneficial interaction with SAIs. Examples of practical partnerships 
and dialogue include the following:

* Supreme audit institutions are already helping to shape the World 
Bank's audit policy. Public audit institutions (among them a large 
number of supreme audit institutions) already provide close to half of 
all audit reports on loans and credits received by the Bank.

* When changes to the Bank's audit policy were discussed in November 
2002, an advisory panel of SAIs offered insights and recommendations.

* The Bank's Development Grant Facility has been supporting the INTOSAI 
Development Initiative (IDI), the training arm of INTOSAI, since 2001 
and more recently helped to underwrite the INTOSAI Working Group on 
Auditing Standards.

* An increasing number of grants from the Institutional Development 
Fund support staff training, needs assessment, and the design of 
auditing manuals or information technology in SAIs.

* Between 1997 and 2002, more than 90 adjustment loan conditionalities 
were designed to have developing country governments better support 
their SAIs.

* As part of its governance agenda, the World Bank Institute provides 
training and organizes seminars aimed at enhancing government auditing 

SAI Independence Is a Prerequisite:

The Bank is cautious not to endanger the independence of SAIs-indeed, 
we do all we can to bolster it. As the Lima Declaration articulates, 
SAIs must have the capacity to perform their professional mission--to 
report freely to the parliament and the public on their findings.

There are many obstacles to overcome: formal and unofficial limitations 
to their mandate, limited access to the public and the media, 
underfunding, understaffing, and "incentives" given in favor of "soft" 

The survey INTOSAI conducted in March 2001 clearly showed that putting 
independence into practice is a complex and constant struggle requiring 
patience and strength and-somewhat ironically-some support from the 
government itself through proper funding.

In our dialogues with country representatives, especially through 
diagnostic work on public financial management, [NOTE 2] the World Bank 
continuously makes the case for improved accountability, transparency 
in the management of public funds, and independence for government 

The agendas of the donor and SAI communities are highly consistent: to 
promote better public management, increase transparency, and improve 
accountability. Development and the fight against poverty depend on it.

Our Growing Commitment:

The Bank-like other donors-can do more to strengthen public sector 
financial management institutions in borrowing countries and to 
increase our reliance on those countries' audit institutions. A 
strategy paper is under preparation, with much appreciated input 
expected from an advisory panel of SAIs in March 2004.

One area for exploration relates to the practice of peer reviews. Peer 
reviews are, for many reasons, a preferred means of identifying 
necessary changes, improving performance, and better serving a 
country's citizens. The World Bank fully supports this approach and is 
very willing to increase the feasibility and frequency of such reviews 
by providing grant funds for that purpose.

The Bank is also exploring ways in which it could cooperate with 
regional organizations of SAIs to better and more often draw on the 
expertise of the SAI community to improve the design and implementation 
of projects related to strengthening the government audit function.

Helping Each Other: 

Cooperation and mutual support were at the heart of the founding of 
INTOSAI in 1953. The organization's motto--"Experientia mutua omnibus 
prodest"--speaks to the need for exchanging experiences in order to 
guarantee that government auditing progresses.

The next INTOSAI Congress in Budapest in October 2004 represents an 
opportunity to further enhance our bilateral and multilateral 
partnerships in support of accountability. Speaking on behalf of the 
Bank, we look forward to continued progress and mutual reinforcement.


[1] The OECD-DAC Good Practices Paper on Financial Reporting and 
Auditing prepared as part of the harmonization initiative states, 
"Donors should accept the Supreme Audit Institutions of partner 
countries as auditors of donor-supported projects when their capacity 
is judged to be acceptable."

[2] This work is reported in Country Financial Accountability 
Assessments, some of which are available on the Bank Web site, 

[End of article]

News in Brief:


International Meeting of Latin American SAIs and the European Court of 

In October 2003, the SAI of Argentina (AGN), together with the European 
Commission, organized an international meeting between the SAIs of 
MERCOSUR (Argentina, Brazil, Paraguay, and Uruguay), Chile, and Bolivia 
and the European Court of Auditors. Participants included auditors 
general and other representatives of the SAIs; members of Parliament 
from Latin America and Europe; Dr. Clodosbaldo Russián, President of 
OLACEFS; and MERCOSUR and European Union officials. Representatives of 
nongovernmental organizations, members of the press, and over 300 audit 
staff from Argentina also attended. Dr. Leandro Despouy, President of 
the AGN and of the Organization of SAIs of the countries of MERCOSUR, 
Bolivia, and Chile, presided over the meeting, which was held in Buenos 
Aires, Argentina.

The meeting dealt with a variety of issues, including the following:

* The role of audit in the evolution of European integration, what the 
countries of MERCOSUR, Bolivia, and Chile can learn from that 
experience, and how cooperation has developed between both regional 
groups over the years.

* A summary of the audits carried out by the SAIs of the member 
countries of MERCOSUR, Bolivia, and Chile, demonstrating the 
cooperative efforts among the audit organizations of the six countries.

[See PDF for image]

Photo Caption: Participants at the Buenos Aires meeting: Robert 
Reynders, Belgian member of the European Court of Auditors; Angelo 
Pagkratis, head of the European Commission delegation in Argentina; 
Leandro Despouy, President of the AGN; Francisco Galiano Morán, 
Comptroller General of Paraguay.

[End of figure]

* Auditing in different government spheres: the executive for the 
European Commission; the Parliament for the budget commissions of the 
European Parliament and the Argentine Parliament; and the important 
task of the European Court of Auditors.

For additional information, contact: Auditoría General de la Nación, 
telephone: (+5411) 4124 3775; fax: (+5411) 3775; e-mail:; Internet:


New Auditor General:

Mr. Gehendra Nath Adhikary was appointed as the ninth Auditor General 
of the Kingdom of Nepal on August 22, 2003.

Prior to his appointment, Mr. Adhikary was the Financial Comptroller of 
Nepal from 1992 to 1994. He also served in this office from 1968 to 
1992 and was an Assistant Auditor General for 14 years.

[See PDF for image]

Photo caption: Mr. Gehendra Nath Adhikary, Auditor General of Nepal.

[End of figure]

Born in Kathmandu, Mr. Adhikary holds bachelor's degrees in Commerce 
and Law from Tribhuvan University, Nepal, and is a member of the 
Institute of Chartered Accountants of Nepal. He has been awarded medals 
and prizes by His Majesty the King of Nepal in recognition of his 
outstanding performance.

Mr. Adhikary was a member of various committees constituted by His 
Majesty's Government of Nepal. Starting in 1996, he served 6 years as 
member secretary in the Irregularities Clearance Committee chaired by a 
Member of the House of Representatives (Parliament) of the Kingdom of 
Nepal. He has contributed articles to journals and periodicals and has 
attended training and scholarship programs in the United States, 
Israel, and Canada.

For additional information, contact: Office of the Auditor General of 
Nepal, telephone: ++977 (1) 26 29 58; fax: ++977 (1) 26 27 98; e-mail:; Internet:

Saudi Arabia:

Enhancing Professional Ties and Building Capacity:

In September 2003, His Excellency (H.E.) Mr. Osama Jaffer Faqeeh, the 
President of the General Auditing Bureau (GAB), presided over a meeting 
between a group of public accounting firms in the Kingdom of Saudi 
Arabia and the GAB's senior management. The meeting was designed to 
enhance the GAB's professional ties with these firms, pave the way for 
exchanging experiences and special knowledge, and keep abreast of 
sophisticated methods and techniques being applied in auditing 

To continue building constructive relationships with auditees, the GAB 
also organized a seminar entitled "Ways and Means of Cooperating to 
Fulfill Comprehensive Auditing and Performance Audit Goals." A large 
number of senior financial personnel drawn from ministries, government 
departments, and public corporations attended the seminar. The seminar 
was designed to provide a professional platform to exchange opinions 
and pursue a dialogue with senior government auditees that would help 
to establish a practical methodology for enhancing the role of 
auditing. The seminar also investigated ways to remove operational 
obstacles to achieving an advanced level of efficiency and 
effectiveness in the governance of public moneys and to deploy public 
resources in order to maximize value-for-money returns. The seminar 
addressed a number of specific areas, including updating the GAB's 
statutes, implementing the comprehensive auditing concept and 
information technology auditing methods, and developing financial rules 
and regulations.

H.E Mr. Osama also led delegations to several international meetings, 
including the third meeting of the Gulf Cooperation Council (GCC) in 
Qatar in May 2003, the INTOSAI Governing Board meeting in October 2003 
in Budapest, Hungary, and the ASOSAI 9th General Assembly meetings in 
October 2003 in Manila, Philippines.

[See PDF for image]

Photo caption: Participants in the General Auditing Bureau's training 
course on performance evaluation for ARABOSAI.

[End of figure]

GAB staff participated in a number of overseas training courses during 
2003 in India, Egypt, and Morocco. The training included topics such as 
audits of social services and rural development programs, IT auditing, 
and financial analysis and budgetary planning. In addition, the GAB 
implemented the second phase of its internal training program for its 
employees by offering 10 training courses. Finally, in October 2003, 
the GAB hosted a training course on performance evaluation for the 
staff of ARABOSAI. This course was organized by the Arabian Group of 
Supreme Institutions for Accountancy and Financial Auditing.

For additional information, contact: General Auditing Bureau, P. O. Box 
7185, University Street, Riyadh 11128, Saudi Arabia; fax: ++966 (1) 403 
20 57; e-mail:; Web page: [Hyperlink, http://]

South Korea:

New Chairman of the Board of Audit and Inspection:

In November 2003, Mr. Yun-Churl Jeon was appointed to be the new 
Chairman of the Board of Audit and Inspection (BAI) of the Republic of 
Korea. In his new capacity, he also serves as Chairman of the Governing 
Board of INTOSAI. He succeeds Mr. Jong Nam Lee, who retired from the 
BAI in September 2003 after completing his 4-year term.

[See PDF for image]

Photo Caption: Mr. Yun-Churl Jeon, Chairman of the Board of Audit and 
Inspection of the Republic of Korea.

[End of figure]

Mr. Jeon has had a lengthy and distinguished career in government. He 
brings to his new position a wealth of experience in public service, 
particularly in financial management, government reform, and budgeting. 
In 2002, he was the Deputy Prime Minister, Minister of Finance and 
Economy, and Presidential Chief of Staff. Earlier in his career, he 
served as Minister of Planning and Budget and Chairman of the Fair 
Trade Commission. He also held various positions in the Economic 
Planning Board and other government offices. Just before his 
appointment to the BAI, he was the chairman of the College of Law and 
Political Science of Cheju National University.

A strong advocate of market economy and competition, Mr. Jeon is 
committed to implementing reform measures to make his organization more 
competitive and to help the Korean government achieve the goals of its 
reform program.

Mr. Jeon graduated from the College of Law of Seoul National University 
with an LL.B. in 1965. He also holds honorary doctorates in economics, 
business administration, and law from several universities in Korea. He 
is the author a number of publications about the market economy.

For additional information, contact: Board of Audit and Inspection, 
telephone: ++82 (2) 2011-2186; fax: ++82 (2) 2011-2189; e-mail:; Internet:

European Court of Auditors:

2002 Annual Report Issued:

In November 2003, the European Court issued its 2002 Annual Report, 
opining that the 2002 accounts of the European Communities prepared by 
the European Commission faithfully reflected the revenue and 
expenditure and the financial position of the Communities at year-end 
except for some shortcomings caused by weaknesses in the design of the 
accounting system. In the Court's opinion, the transactions underlying 
the accounts were legal and regular in regard to resources, 
commitments, administrative expenditures, and preaccession aid, 
although supervisory systems and controls should be improved in the 
latter case.

The Court noted substantial progress in the Commission's implementation 
of administrative reforms. Despite this progress, internal control 
standards were still not being fully applied at a minimum level 
throughout all Directorates-General by the end of 2002, a matter of 
some urgency. Difficulties were encountered in implementing reform in 
the areas of expenditure where the Commission and Member State 
administrations share management. Progress in these areas--which 
constitute more than 80 percent of the budget and involve agricultural 
policy and structural measures--depends on making improvements in the 
administrative and control systems set up by the Member States. To 
improve transparency and monitoring of the reform process, the Court 
recommended that the Commission update the 2000 White Paper on 
administrative reform by revising the timetable and consolidating the 
list of outstanding issues.

Since its previous Annual Report, the European Court of Auditors issued 
13 special reports as well as 6 opinions covering different aspects of 
European Union finances and management issues.

For further information, contact the External Relations Department of 
the European Court of Auditors, telephone: ++352-021-36 31 03; fax: 
+352-4398-46430; or e-mail: The full text of the 2002 
Annual Report is available on the Internet at A summary of the report is 
available at

[End of News in Brief]

Addressing Fiscal Risks: A Case for Greater Truth and Transparency in 
Government Financial Reporting:

By David M. Walker, Comptroller General of the United States:

I recently gave a speech at the National Press Club in Washington, 
D.C., on a subject that, in my view, has not been getting the attention 
it deserves: the U.S. government's worsening financial situation. [NOTE 
1] In my remarks, I tried to present the facts, speak the truth, and 
explain to the American people that our country has a serious and 
growing fiscal imbalance.

The reality is that the United States faces a structural deficit that 
will only deepen as the baby boomers [NOTE 2] begin to retire and put 
unprecedented strains on the nation's spending and tax policies. The 
impact of slower economic growth and the recent difficulty in 
maintaining fiscal restraint have not helped matters. The expected 
fiscal gap is now so large that there is little chance we will be able 
to simply grow our way out of the problem.

Yet, this sobering assessment would come as a surprise to many 
Americans, in part because government financial reporting provides an 
unrealistic and even misleading picture of the federal government's 
overall performance and financial condition. Few agencies adequately 
show the results they are achieving with the taxpayer dollars they 
spend, and too many government commitments and obligations are reported 
in an incomplete or invisible way.

Every nation has its own set of fiscal challenges, and the United 
States is not unique. Most governments today face some degree of fiscal 
risk that is not as transparent as it should be. For instance, many 
industrialized nations will have to make difficult choices to meet the 
needs of their aging populations. Regardless of the specific issues 
involved, government financial reports generally fall short in 
conveying the threat that these longterm challenges can pose to future 
budgets, tax burdens, and spending flexibilities.

Particularly troubling are the many commitments that governments have 
made that may not show up in their budgets or financial statements for 
years. In the case of the United States, the government has pledged its 
support to a long list of programs and activities--including pension 
and health care benefits for senior citizens, veterans' medical care, 
and government-sponsored entities--that will cost billions of dollars 
but whose future unfunded commitments do not appear in government 
financial statements.

Commercial accounting practices require companies to record their 
pension, health care, and other obligations on their balance sheets, 
but many governments fail to fully disclose similar costs, such as 
those of veterans and social insurance programs, in their financial 
statements. Too often, taxpayers and even some public officials become 
aware of these commitments only when a crisis is upon them. In recent 
years, countries from Latin America to East Asia have faced economic 
instability when their governments were suddenly forced to make good on 
obligations that few knew existed.

Greater truth and transparency in government reporting are essential if 
the United States and other nations are to address their long-term 
fiscal challenges. The fact is that the fiscal risks just mentioned can 
be managed only if they are properly accounted for and publicly 

Supreme audit institutions (SAI) can play a vital role in drawing 
attention to serious fiscal imbalances and promoting sound accounting 
and reporting practices in their respective countries. An agency 
insulated from day-to-day political pressures, such as an SAI, can 
afford to take a longer term view and provide professional, objective, 
and nonpolitical information on its government's fiscal health.

SAIs should consider moving beyond routine oversight of day-to-day 
government operations to alert policymakers to long-term trends with 
serious implications.

Through considered analysis based on foresight and strategic thinking, 
they can help to prepare their governments for the challenges of the 
future--before they reach crisis proportions. SAIs should encourage 
their governments to look beyond current year budget numbers and 
consider the long-term consequences of current policy decisions. 
Governments could then better manage their cash flow and make informed 
choices about future financing needs.

Educating key policymakers, opinion leaders, and the public is 
essential. To this end, SAIs can shed considerable light on fiscal 
risks. Importantly, history shows that with light comes heat, and with 
heat comes action. A crucial first step will be to identify and 
classify the significant commitments facing the government. If both 
citizens and government officials come to understand various fiscal 
exposures and their potential claims on future budgets, they are more 
likely to insist on prudent policy choices and sensible levels of 
future fiscal risk. In seeking to stimulate broader public discussion 
and debate, SAIs will need to be careful to provide constructive 
recommendations that do not compromise their independence or cross over 
into policy-making.

Increasing awareness of fiscal exposures, however, is not enough. To 
create incentives to better support sound decisions about how to 
finance or avoid such exposures, SAIs will need to encourage the 
development of accurate cost measurements and their integration into 
financial reporting, budgeting, and other policy processes. SAIs may 
also want to consider developing a single portfolio of a country's 
fiscal exposures and using fiscal simulation models to help illustrate 
the nature, timing, and context of fiscal challenges and imbalances. 
SAIs should also consider encouraging the development and use of a set 
of key national indicators spanning economic, social, environmental, 
safety, and security issues to assess a nation's position and progress 
over time and relative to those of other countries.

While there is no easy solution to improving government financial 
reporting, nations around the world are making progress little by 
little. Some nations have already made great strides. In 1992, New 
Zealand became the first country to present central government 
financial statements on an accrual basis. In addition to enhancing the 
transparency of its financial commitments in budget documents and 
including items such as capital charges and cost allocations, New 
Zealand has also embraced various modern management practices, 
including strategic plans and executive performance agreements.

Some SAIs have begun to increase understanding of their government's 
long-term fiscal outlooks. For several years, the U.S. General 
Accounting Office (GAO) has been simulating the interactions of the 
federal budget and the economy to show the longterm effects of current 
law and various fiscal policy alternatives, including the projected 
growth in existing social insurance programs. Several SAIs have been 
trying to measure potential fiscal contingencies. The United Kingdom's 
National Audit Office, for example, recently reported on fiscal 
exposure arising from the clinical negligence of employees of the 
National Health Service, including hospital doctors.

An informal Auditor General's Global Working Group, of which the United 
States is a member, has also been addressing many of these challenges. 
At its 2003 meeting in the Hague, SAIs from more than a dozen major 
countries were joined by their senior budget officials to discuss the 
role that audit institutions can play in deliberations over current 
budgets and future fiscal challenges. Treasury officials acknowledged 
that SAIs can and have been essential to disclosing underlying fiscal 
commitments and claims. The SAIs and the budget officials agreed that 
the independence and credibility of audit institutions can be a 
powerful force to enhance the transparency of a nation's fiscal 
standing and condition in both the short and long terms.

INTOSAI's Public Debt Committee has also issued valuable guidance to 
audit institutions on how to work more actively with government 
officials to reform reporting practices and procedures. The goal is to 
produce government financial reports that more systematically disclose 
and highlight the nature of existing budget commitments and claims and 
their future fiscal implications. In a recent report, the committee 
developed a framework for defining and disclosing long-term commitments 
facing various nations. The committee concluded that this framework 
would help promote full information on the nature and the level of 
commitments entered into by nations that encumber future resources. 
[NOTE 3]

In the United States, we are starting to see efforts to address the 
shortcomings in federal financial reporting. The President's most 
recent budget submission and the latest annual report of the U.S. 
government focus more on the nation's long-range fiscal imbalance. The 
President's Management Agenda, which closely reflects GAO's list of 
high-risk government programs, is bringing additional attention to 
problem areas across government. The government is also taking steps to 
assess the results that programs are achieving with the resources they 
are given.

GAO recently published a framework for analyzing various Social 
Security reform proposals and will soon publish a framework for 
analyzing health care reform proposals. GAO has also helped to create a 
consortium of "good government" organizations to stimulate the 
development of a set of key national indicators to assess the United 
States' overall position and progress over time and in comparison to 
those of other industrialized nations.

GAO and other budget experts continue to urge enhancements to the 
federal budget process to better reflect the government's commitments 
and signal emerging problems. Among other things, GAO has recommended 
that the government issue an annual report on major fiscal exposures.

"We might hope to see the finances of the Union as clear and 
intelligible as a merchant's books," U.S. President Thomas Jefferson 
wrote his Secretary of the Treasury in 1802, "so that every member of 
Congress, and every man of any mind in the Union, should be able to 
comprehend them, to investigate abuses, and consequently to control 
them." Unfortunately, timely, reliable, and useful government financial 
information can seem as elusive in 2004 as it did in Jefferson's day.

But the way in which a government measures and keeps score still 
matters. Government auditors and policymakers alike need to start 
facing fiscal facts squarely so that future financial stresses can be 
anticipated and addressed. The importance of speaking out on these 
issues cannot be overemphasized. Elected officials will have more 
incentive to make difficult but necessary choices if the public knows 
the truth and comes to support serious and sustained action to address 
fiscal risks. Without meaningful public debate, however, real and 
lasting change is unlikely. SAIs, with their reputation for 
professionalism, independence, and integrity, are in a unique position 
to lay the facts on the table and get the discussion going. The time to 
start is now.


[1] The full text of the speech, entitled "Truth and Transparency: The 
Federal Government's Financial Condition and Fiscal Outlook," is 
available on the Web site of the U.S. General Accounting Office at

[2] "Baby boomer" generally describes persons born in the United States 
during a period of high birth rates from 1946 to 1964.

[3] See Fiscal Exposures: Implications for Debt Management and the Role 
for SAIs (INTOSAI Public Debt Committee, Feb. 2003), available online 

[End of article]

Five Countries Pioneering Accrual Budgeting and Accounting in Central 

By Martin Dees and Paul Neelissen, Netherlands Court of Audit:


In its 2001 Budget Memorandum, the Dutch government announced that 
accrual budgeting and accounting would replace the current obligation-
cash budgeting and accounting system in ministerial budgets and 
accounts in several years' time.

In order to support the Dutch parliament and the government in their 
preparations to introduce this system, the Netherlands Court of Audit 
published a report on this subject in April 2003, Accrual Budgeting and 
Accounting in Central Government-Budgets and Accounts in Balance. The 
report discusses the government's proposals and describes and analyzes 
accrual budgeting and accounting standards and practices in the 
Netherlands and abroad.

The report states that accrual budgeting and accounting have been 
introduced in many countries. This has happened because results-
oriented and transparent budgeting, accounting, and management require 
a focus on costs instead of (or as well as) expenditures and a greater 
understanding of income, expenses, and financial position.

It should be noted, though, that at present no two countries have 
introduced identical systems. No trend towards international 
harmonization has developed as yet. Even within individual countries, 
the details differ significantly from one part of the public sector to 
another. In addition, many countries are reluctant to apply accrual 
systems to their budgets. Many members of parliament consider the 
authorization of cash expenditures to be a great benefit; they have an 
abiding fear of cash overruns and are daunted by the technical 
complexity of the accrual system and the attendant potential for 
manipulating financial data. In a more technical sense, moreover, the 
system must take account of specific government issues as well as those 
known from the private sector, such as the valuation of buildings and 
the recognition of provisions. [NOTE 1] These issues include the 
appropriate accounting treatment of defense equipment, cultural 
heritage, social security obligations, and obligations relating to the 
government's position as ultimate guarantor of the continuity of such 
privatized services as public transport and the electricity supply.

The remainder of this article compares the technical manifestations of 
the accrual system in five countries (New Zealand, Australia, the 
United Kingdom, the United States, and Sweden) that have been pioneers 
in this area. These examples may serve as a source of reflection for 
other countries that are considering introducing this system. This also 
goes for the Netherlands, whose government has recently decided to 
postpone the introduction of the new system for several years.

Five Pioneering Countries Compared:

With respect to the general design of the accrual system, the following 
can be observed about the five countries whose practices we compared:

* Most introduced an accrual system that was both comprehensive (for 
all central government entities) and full (including complete 
statements of financial position and financial performance and a link 
between these two main documents).

* Most adopted an accrual basis for both budgeting and accounting.

* The budgets and, in particular, the accounts of most include the 
three main accrual-based financial statements (statement of financial 
position, statement of financial performance, and cash flow statement).

* The financial statements of the various parts of central government 
are generally consolidated into central government financial 
statements; the public sector as a whole is generally not consolidated.

* The legislature authorizes various items: costs, cash expenditures, 
obligations, or both; in most cases it principally authorizes costs.

* Accounting standards in most pioneering countries are based on 
private sector standards, with certain departures to allow for the 
unique characteristics of their government. National and government 
accounting are separate; national accounting standards played virtually 
no role in the development of government accounting standards in most 
pioneering countries.

The details of these observations are presented in table 1.

Table 1: Design of Accrual Systems in Five Countries:

General design issues: Comprehensive accrual system;
New Zealand: Yes;
Australia: Yes;
United Kingdom: Nearly comprehensive;
United States: Yes;
Sweden: Yes.

General design issues: Full accrual system;
New Zealand: Yes;
Australia: Yes;
United Kingdom: Nearly full;
United States: Nearly full;
Sweden: Yes.

General design issues: Accrual budgeting and accounting;
New Zealand: Yes;
Australia: Yes;
United Kingdom: Yes;
United States: No budgeting;
Sweden: Yes, budgeting being developed (2004).

General design issues: Main budget statements: Estimated statement of 
financial position;
New Zealand: Yes;
Australia: Yes;
United Kingdom: No;
United States: No;
Sweden: Yes (2004).

General design issues: Main budget statements: Estimated statement of 
financial performance;
New Zealand: Yes;
Australia: Yes;
United Kingdom: Yes;
United States: No;
Sweden: Yes (2004).

General design issues: Main budget statements: Estimated cash flow 
New Zealand: Yes;
Australia: Yes;
United Kingdom: Yes;
United States: Yes;
Sweden: Yes (2004).

General design issues: Main accounting statements: Statement of 
financial position;
New Zealand: Yes;
Australia: Yes;
United Kingdom: Yes;
United States: Yes;
Sweden: Yes.

General design issues: Main accounting statements: Statement of 
financial performance;
New Zealand: Yes;
Australia: Yes;
United Kingdom: Yes, but in specific form[B];
United States: Yes, but in specific form[C];
Sweden: Yes.

General design issues: Main accounting statements: Cash flow statement;
New Zealand: Yes;
Australia: Yes;
United Kingdom: Yes;
United States: No;
Sweden: Yes.

General design issues: Consolidation of central government accounts;
New Zealand: Yes;
Australia: Yes;
United Kingdom: Yes, being developed (2005);
United States: Yes;
Sweden: Yes.

General design issues: Consolidation of public sector accounts (incl. 
Local government);
New Zealand: No;
Australia: No;
United Kingdom: Yes, being developed (2007);
United States: No;
Sweden: No.

General design issues: Authorization;
New Zealand: Costs (of outputs)[A];
Australia: Costs (of outcomes)[A];
United Kingdom: Net costs and cash expenditures;
United States: Cash expenditures/ obligations;
Sweden: Cash expenditures (2004: costs).

General design issues: Based on existing accounting standards;
New Zealand: Yes: NZ GAAP; (private sector);
Australia: Yes: AAS; (private sector);
United Kingdom: Yes: UK GAAP; (private sector);
United States: No: standards specifically developed for federal 
Sweden: Yes: Swedish GAAP (private sector).

General design issues: National accounting of relevance to government 
New Zealand: No;
Australia: No (relevant to budget);
United Kingdom: No;
United States: Some relevance;
Sweden: No, barely relevant.


AAS = Australian Accounting Standards;
GAAP = Generally accepted accounting principles;

[A] Operating cost statement (costs less direct program revenues).

[B] Statement of net costs (costs less direct program revenues).

[C] And partly cash expenditures.

[End of table]

With respect to the main accounting principles applicable in each 
country, the following observations were made:

* There are considerable differences in valuation policies from 
primarily historical cost (Sweden, United States) to primarily modified 
historical cost (New Zealand, United Kingdom) to primarily current 
value (Australia).

* The main statement of financial position classification agrees with 
the generally accepted classification of fixed and current assets, 
liabilities, and equity as a balancing item.

* The depreciation method is either straight-line or optional.

* Provisions are permitted in all five countries.

* All five countries calculate equity (under a variety of names) in 
accordance with generally accepted principles as the balance of assets 
and liabilities.

* In all five countries, tax revenue allocated by the central tax 
collecting agency is accounted for by the other parts of central 
government receiving the revenue.

* All five countries calculate an operating result (in a variety of 
ways) as the balance between income and expenses.

* Three of the five countries apply a capital charge.

Table 2 presents the main accounting principles applicable in each 

Table 2: Accounting Principles Applicable in Five Countries:

Accounting Principle: Main valuation policy for fixed assets;
New Zealand: Modified historical cost (with revaluation) or market 
Australia: Market value (previously historical cost or market value) or 
replacement value;
United Kingdom: Modified historical cost or replacement value or 
realisable value;
United States: Historical cost;
Sweden: Historical cost or, in certain cases, lower market value.

Accounting Principle: Main statement of financial position 
New Zealand: Assets (current and non-current); liabilities (as above); 
Australia: Assets (financial and non-financial, and current and non-
current); liabilities (as above); equity;
United Kingdom: Assets (fixed and current); liabilities; equity;
United States: Assets (entity and non-entity); liabilities (covered and 
not covered by budgetary resources); equity;
Sweden: Assets (intangible fixed, tangible fixed, financial and various 
categories of current assets); liabilities; equity.

Accounting Principle: Depreciation method;
New Zealand: Straight-line; with residual value; prescribed terms;
Australia: Straight-line; with residual value; prescribed terms;
United Kingdom: Optional, but in principle straight-line; no prescribed 
United States: Optional, provided systematic, rational and best 
reflecting use; with residual value;
Sweden: Optional, but 'normal method' (straight-line) and 'normal 
terms' are named.

Accounting Principle: Provisions permitted;
New Zealand: Yes: provisions;
Australia: Yes: provisions;
United Kingdom: Yes: provisions for liabilities and charges;
United States: Yes: loss contingencies;
Sweden: Yes: provisions.

Accounting Principle: Determination of equity;
New Zealand: Yes: public (tax payer's) equity (consolidated: crown 
Australia: Yes: equity (consolidated: net assets);
United Kingdom: Yes: taxpayer's equity;
United States: Yes: net position;
Sweden: Yes: agency capital plus funds (consolidated: net capital plus 

Accounting Principle: Allocation of tax revenue to parts of central 
New Zealand: Yes;
Australia: Yes;
United Kingdom: Yes (in notes);
United States: Yes;
Sweden: Yes.

Accounting Principle: Determination of operating result;
New Zealand: Yes: operating surplus/deficit (consolidated: operating 
Australia: Yes: net surplus/deficit (consolidated: net result);
United Kingdom: Yes: net operating costs (but excluding tax revenue, 
United States: Yes: net result of operations;
Sweden: Yes: change in capital for the year.

Accounting Principle: Use of capital charge;
New Zealand: Yes: 6% of equity;
Australia: Yes: 12% of equity;
Australia: Yes: 6% of equity;
United States: No;
Sweden: No.

[End of table]


The optimal design of accrual systems in the public sector is expected 
to remain hotly debated both nationally and internationally in the 
years ahead. Organizations and networks such as INTOSAI, the 
Organisation of Economic Co-operation and Development (OECD), the 
International Federation of Accountants (IFAC) Public Sector Committee, 
and Comparative International Accounting Research (CIGAR) might provide 
valuable information and stimulus for further development and 
international harmonization.

An English copy of the report Accrual Budgeting and Accounting in 
Central Government-Budgets and Accounts in Balance is available on 
request from the author ( or on the Internet 
( Further information on government budgeting and 
accounting in nine European countries (Finland, France, Germany, Italy, 
Netherlands, Spain, Sweden, Switzerland and the United Kingdom/Ireland) 
can be found in a recent book, Reforming Governmental Accounting and 
Budgeting in Europe, Klaus Lüder and Rowan Jones (eds.), (Frankfurt, 
Germany: Fachverlag Moderne Wirtschaft, November 2003), ISBN: 3-934803-


[1] Provisions are part of an organization's liabilities created for a 
clear and specific purpose to meet certain future obligations.

[End of article]

Ninth ASOSAI Assembly and 2nd Symposium:

By Alberta E. Ellison, U.S. General Accounting Office:

The Asian Organization of Supreme Audit Institutions (ASOSAI) held its 
9th Assembly and 2nd Symposium in Manila, Philippines, October 20-26, 
2003. Hosted by the SAI of Philippines, the Assembly drew delegates 
from 33 SAIs as well as observers from other SAIs, the Asian 
Development Bank, the INTOSAI Secretariat General, the INTOSAI 
Development Initiative (IDI), and this Journal.

Opening Ceremony:

The 9th Assembly of ASOSAI opened on October 21, with Dr. Panya 
Tantiyavarong, ASOSAI Chairman and Chairman of Thailand's State Audit 
Commission, and Chairman Guillermo N. Carague of the Assembly host, the 
Philippine Commission on Audit, leading the opening ceremonies. They 
both welcomed the 130 delegates and observers from 33 ASOSAI member 

Philippine Vice President Teofisto T. Guingona, Jr., was the guest of 
honor and keynote speaker at the opening ceremony. In his address, he 
called the attention of ASOSAI to "the need for auditing to be 
responsive to the demands of globalization and technology advances as 
well as to the goals and development needs of its member countries."

Chairman Carague urged the delegates to make use of the 9th Assembly as 
a "venue to renew old ties, bid farewell to those whose terms are 
expiring, and warmly welcome those who are joining for the first time" 
and to perpetuate the bond of friendship and camaraderie to ensure the 
continued smooth functioning of ASOSAI in the future. In addition, he 
stressed that everyone must be more "vigilant in the discharge of the 
responsibilities of their own SAIs in the face of recent developments 
that have buffeted the world of accountancy and which saw the 
unraveling of a number of supposedly financially sound companies and 
even the collapse of one of the world's oldest and largest auditing 

Ceremony to Unveil ASOSAI Marker:

The 130 ASOSAI assembly delegates and observers gathered at the 
Professional Development Center Building of the Commission on Audit to 
witness the unveiling of the souvenir architectural representation 
celebrating the 9th ASOSAI Assembly and 2nd Symposium. Upon arrival, 
the delegates were greeted by top Commission officials. The special 
guest speaker during this event was Dr. Francisco Tantuico, Jr. (former 
Chairman of the Commission of Audit, ASOSAI founding member, and first 
ASOSAI Secretary General), who briefed the delegates on the founding of 

First Plenary Session Summarizes Governing Board Meeting:

The first plenary session reviewed the report of Secretary General 
Vijayendra N. Kaul on ASOSAI's activities since the previous Assembly. 
Highlights of the report included the:

* approval of financial statements for 2000-2002 and the report of the 
audit committee,

* ASOSAI training activities,

* the sixth ASOSAI research project on IT audit,

* presentation and discussion of audit guidelines on fraud and 
corruption, and:

* IDI's report on training initiatives in ASOSAI.

[See PDF for image]

Photo caption: During the first plenary session, Mr. Vijayendra N. Kaul 
(India), Secretary General of ASOSAI, second from left; Mr. Guillermo 
N. Carague (Philippines), Incoming ASOSAI Chairman, center; and, Dr. 
Panya Tantiyavarong (Thailand), Outgoing ASOSAI Chairman, second from 
right; addressed the assembly.

[End of figure]

The SAIs of Afghanistan, Bahrain, Georgia, the Lao People's Republic, 
and Mauritius were admitted as members of ASOSAI. It was also reported 
that ASOSAI, the Asian Development Bank, and the Government Auditing 
Foundation of Japan had signed an agreement to provide technical 
assistance that aims to enhance the training capabilities of member 
SAIs by expanding the existing pool of training specialists. This pool 
of 27 certified training specialists was created in 1998 under the Long 
Term Regional Training Program.

Second Symposium on Quality Management in Public Audit:

The 2nd Symposium on "Quality Management in Public Audit" was held with 
the former Philippine Finance Secretary and now Asian Institute of 
Management President Roberto de Ocampo as guest speaker. In his speech 
on "Public Audit and Good Governance," he stated that his topic "is 
timely as countries all over the world today are very concerned about 
good governance in both the public and corporate sectors." He also 
stated, "Quality audit means a balance between discretion and common 
sense versus being a stickler for the absolute letter of rule. It means 
not losing sight of the forest by being too finicky about the trees. It 
means the ability to prioritize so as not to waste time--both the 
auditor's and the auditee's. It means not overburdening either of them 
by an overzealous passion for detail so that one ends up losing sight 
of the overall objective of the audit--was government money spent 

Assistant Commissioner Roberto B. Catli moderated a panel presentation 
on quality management in public audit. Participants included Dr. 
Gertrude Schlicker (INTOSAI General Secretariat), Mr. Muhammad Yunis 
Khan (Pakistan), Mr. Asif Ali (Bangladesh), Mr. Kevin Brady (New 
Zealand), and Mr. Sunil Bahri (India).

Dr. Schlicker stated, "Assuring high level quality in an audit 
organization involves a succession of steps that must be taken over a 
period of time." The standards of quality should first be defined and 
ensure that quality control procedures are put in place. Once this is 
done, the auditor has to see to it that the quality control procedures 
are working efficiently and "identify ways of improving the 
effectiveness or efficiency of procedures." She even suggested 
techniques on how to do this--"use of various types of post-audit 
quality reviews, building an institutional culture wherein high quality 
is a fundamental value that is reflected in the management of the SAI's 
human resources and its relation with other institutions."

Mr. Muhammad Yunis Khan, the Auditor General of Pakistan, stated that 
"the clientele of the SAI is the public, the taxpayer, and the public 
representatives who approve public spending and scrutinize the audit 
reports." Therefore, for SAIs, the challenge of quality management in 
public audit is to come as close as possible to meeting the differing 
expectations of the clientele. Pakistan's strategies include 
dissociating itself from direct involvement in accounting and promoting 
implementation of accounting reforms, among them the installation of a 
national network of core accounting systems with accrual reporting 
features and the potential for upgrading to full accrual in the coming 
years. Pakistan's expectation is that "sound accounting and financial 
reporting will provide the basis for effective auditing during the next 
5 years."

To Mr. Asif Ali, Comptroller and Auditor General of the Bangladesh SAI, 
quality management in public audit is "certification of the accounts; 
compiling of the audit reports; the organizational capability of 
manpower, techniques, and practices; as well as implementation of the 
auditing standards and guidelines issued by the INTOSAI and the 
ASOSAI." Mr. Kevin Brady of the New Zealand SAI emphasized four 
elements: "(1) understanding the environment in which auditors work; 
(2) ensuring that the office has the best people; (3) [determining] how 
to go about promoting good governance; and (4) practicing what is being 

The Indian SAI's experiences and quality initiatives include 
"measurement of the effectiveness of audit based on a desirability-
acceptability matrix that grades the audit paragraphs or audit comments 
found in the audit reports; information technology-related initiatives 
such as workflow automation to standardize processes; external 
certification, starting with the training institutions; peer reviews; 
and revamping the technical inspection and internal audit within the 
organization." Of course, all these initiatives have taken into account 
"that standards are complied with at all levels and there is a way of 
ensuring quality."

Election of Governing Board and Audit Committee Members:

Mr. Carague advised the Assembly participants that the SAI of the 
People's Republic of China will host the 10th Assembly of ASOSAI in 
2006 and that the SAI of India will continue as the Secretary General 
of ASOSAI for the next 3 years.

Elections were held during the meeting to determine the SAIs that would 
constitute the ASOSAI Governing Board for the next 3 years. The 
Governing Board consists of nine member countries, of which five are 
elected by the Assembly. The countries of Bangladesh, Bhutan, Malaysia, 
Pakistan, and Saudi Arabia were elected for a 3-year term at this 
meeting. The other three members are the head of the SAI where the last 
Assembly was held (Philippines), the head of the SAI where the next 
Assembly will be held (Peoples' Republic of China), and the Secretary 
General of ASOSAI (India). The Governing Board unanimously appointed 
Japan as its fourth member. The SAIs of Indonesia and Turkey were 
elected to positions on the Audit Committee.

For additional information regarding the 9th ASOSAI Assembly, please 
contact Mr. Guillermo N. Carague, Chairman of the Commission on Audit, 
Central Office, Commonwealth Avenue, Quezon City 1119, Philippines; 
telephone: ++63-2-93192-32; fax: ++632-9319223; e-mail: or Web site:

[End of article]

XIII OLACEFS General Assembly Held in Cuba:

By Monika González-Koss, INTOSAI General Secretariat:

Delegates from SAIs throughout Latin America met in Havana, Cuba, to 
celebrate the XIII General Assembly of the Organization of Latin 
American and Caribbean Supreme Audit Institutions (OLACEFS). The 
Assembly was hosted by the Cuban SAI (the Ministry of Audit and 
Control) November 12-15, 2003. Participating OLACEFS member SAIs were 
Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica, the Dominican 
Republic, Ecuador, El Salvador, Guatemala, Honduras, Mexico, the 
Netherlands Antilles, Panama, Paraguay, Peru, Portugal, Spain, and 
Venezuela. Delegates of those countries were joined by observers 
representing the INTOSAI General Secretariat, the INTOSAI Development 
Initiative, and the SAIs of Algeria, China, the Russian Federation, and 
the United Kingdom.

Inaugural Ceremony:

The inaugural ceremony took place in the Hotel Melia Cohiba. In his 
opening speech, Dr. Clodosbaldo Russián Uzcategui, Comptroller General 
of Venezuela and President of OLACEFS, expressed his gratitude to the 
Cuban SAI for the excellent organization of the event and gave a 
heartfelt welcome to all participants. Dr. Enrique Lau Cortés, 
representing Dr. Alvin Weeden Gamboa, the Panamanian General Secretary 
of OLACEFS, stressed the importance and ongoing relevance of the ideas 
of Cuban hero José Marti regarding Latin American integration as a 
factor in strengthening the Latin American SAIs.

Ms. Lina Pedraza Rodriguez, head of the Cuban Ministry of Audit and 
Control, explained the importance for her SAI of celebrating the 2003 
OLACEFS Assembly in Cuba, where INTOSAI had been founded exactly 50 
years earlier. Dr. Ricardo Alarcón de Quesada, President of the 
National Assembly of Cuba, underscored the importance of the work done 
by SAIs as the principal public organ for auditing and detecting 
irregularities. The last guest speaker, Mr. Sergey Stepashin, President 
of the Russian SAI, pointed out the necessity of close cooperation 
among SAIs all over the world, especially taking into consideration the 
increasingly transcontinental character of financial offenses.

Technical Theme Presentations:

The XIII OLACEFS General Assembly was organized around three technical 
themes. Plenary addresses introduced each theme followed by delegate 
debates on the professional and technical issues mentioned in the 
principal papers and other presentations. Conclusions and 
recommendations were developed and approved for each theme.

Theme 1: Methods to Plan and Carry Out Audits of Public Debts:

Mexico was the coordinator for this theme and prepared the lead paper. 
Ecuador was the moderator, and El Salvador acted as rapporteur. A 
number of other SAIs prepared country papers on the theme. The 
representative of the INTOSAI Development Initiative (IDI) also took 
part in the debate, explaining the progress in the training courses and 
workshops on public debt audits being organized as a pilot project in 
the OLACEFS region by IDI and the INTOSAI Committee on Public Debt, 
chaired by the SAI of Mexico. The conclusions and recommendations on 
this theme included the following:

* SAIs should evaluate the quality of internal control, corroborate the 
importance of complete and reliable registers of debt transactions, and 
promote the elaboration of complete public reports.

* SAIs should assess the support for short-and long-term debts and 
express their opinion on the actions taken to refinance, convert, and 
write them off.

* SAIs should analyse the structure of public debt in order to define 
its effects on the cash flow of a country and evaluate the strategies 
applied to minimize risks and costs.

* SAIs should, within the framework of their national competencies, 
permanently control a country's public debt to guarantee clear, 
transparent, and adequate contracting, utilization, administration, 
registering, pay control, and accountability.

* SAIs should inform their parliaments, the executive power, and 
taxpayers of the public debt situation and its effect on future 
generations to foster government responsibility on this important topic 
with high transgenerational impact.

Theme II: Information Technology:

Mr. José Bidot Pelaez, Director of Information Security of the Cuban 
Ministry of Information and Communications, gave the plenary address on 
this theme, explaining the great potential, as well as the risks, of 
using information technology in public administration. The SAI of Chile 
as coordinator stressed the necessity for SAIs to increase the overall 
use of these techniques in their audits as part of their modernization 
process. The SAI of Honduras as moderator and the SAI of Paraguay as 
rapporteur and several participating SAIs provided further analysis and 
discussion. The most important conclusions and recommendations on this 
theme include the following:

* SAIs should adapt to the changing conditions of their auditees, 
taking into account the fact that nearly all their data and processes 
are electronically based.

* SAIs should elaborate within their technical frameworks special audit 
methods for the different fields of information technology.

* SAIs should actively accept the challenges of e-government and join 
this virtual world.

* SAIs should prepare their staffs to cope with and handle all kinds of 
new technologies.

* SAIs should implement a plan permitting the exchange of experiences 
and IT programs used in IT-related audits.

Theme III: Strengthening the SAI:

The SAI of Bolivia was coordinator and had also prepared the lead 
paper. The SAI of Colombia was the moderator and the SAI of Guatemala 
the rapporteur. In the debate, several delegations outlined the 
importance of SAI independence and institutional capacities, of 
fostering the public's confidence in the SAI, and of ethics.

The conclusions and recommendations include the following:

* SAIs should seek from their legislative bodies adequate legal 
frameworks to guarantee their independent work.

* SAIs should take preventive efforts to reinforce personal ethical and 
moral conduct, thus helping to establish an ethical culture.

* SAIs and OLACEFS should continue their efforts to strengthen and 
improve their situation by empowering their human resources and systems 
as well as by elaborating strategic plans for their institutions.

Signing of Agreements:

Along with the celebration of the OLACEFS General Assembly, the SAI of 
Cuba signed cooperative agreements with the SAIs of the Russian 
Federation, the Dominican Republic, and Brazil.

[See PDF for image]

Photo caption: Delegates to XIII OLACEFS Assembly in Cuba.

[End of figure]

OLACEFS Business:

During the general business plenary on the last day of the General 
Assembly, the OLACEFS Regional Training Committee reported on its 
multiple training projects, especially the great success in 
implementing the IDI-OLACEFS Long Term Regional Training Plan and their 
efforts to strengthen the training infrastructure in the region.

The Chamber of Accounts of the Dominican Republic was accepted as a new 
member of OLACEFS. The following SAIs are members of the new OLACEFS 
Governing Board: Argentina, Cuba, Honduras, Panama, Paraguay, and 
Venezuela. The SAI of Chile and Colombia were designated as auditors of 

Argentina was named as the site of the OLACEFS General Assembly in the 
year 2004.

The representative of the U.K. National Audit Office invited the 
participants to the third joint EUROSAI-OLACEFS Seminar to be held in 
London in May 2004.

Other Activities:

Throughout the conference, the Ministry of Audit and Control treated 
participants with overwhelming hospitality and Caribbean warmth. 
Delegates and special invited guests attended a cultural gala offered 
by the National Cuban Symphony Orchestra as well as a ceremony in the 
old port fortress of Havana. On Thursday afternoon, the participants 
had the unique opportunity to visit the Latin American School of 
Medicine, which offers underprivileged students from developing 
countries in Latin America and Africa a complete course of medical 
studies in Cuba, focusing their preparation on social medicine to 
prepare future doctors for work in their home countries.

On the last day of the Assembly, delegates and guests were taken to 
Varadero, the most famous tourist seaside center in Cuba, where the 
regional minister for tourism explained the development of 
international tourism in Cuba in the past 10 years.

For more information, please contact the OLACEFS General Secretariat, 
Contraloría General, Av. Balboa y Av. Federico Boyt, Apartado 5213, 
Zona 5, Panama City, Panamá; telephone: ++507 264 00 59; fax: ++507 263 
93 22; e-mail:; and Web site: 

[End of article]

Audit Profile: Auditor-General's Office of Papua New Guinea:

By Mr. Mark Wani, Auditor General:

Until 1973, the audit responsibilities relating to what was then the 
Territory of Papua and New Guinea were vested with the Australian 
National Audit Office (Commonwealth Audit Office of Australia). 
However, when the Territory of Papua and New Guinea attained self-
government status from Australia in 1973, it signaled the beginning of 
a new era marked by passage of the Public Finances (Control and Audit) 
Act, 1973. The same year, the Office of the Auditor-General was 
established and the first Auditor-General of Papua New Guinea was 
appointed. With the attainment of independence in 1975 and the birth of 
Papua New Guinea as an independent nation, Sections 213 and 214 of the 
Constitution of the Independent State of Papua New Guinea established 
the Office of Auditor-General of Papua New Guinea (PNG AGO) as the 
supreme audit institution of Papua New Guinea (PNG).

Scope of Audit Authority:

Section 214 of the Constitution of the Independent State of Papua New 
Guinea requires the Auditor-General's Office to inspect and audit and 
report to the Parliament at least once in every fiscal year (as 
provided by an act of the Parliament) on (1) the Public Accounts of 
Papua New Guinea, (2) the control of and transactions with or 
concerning the public moneys and properties of Papua New Guinea, and 
(3) other functions prescribed by or under constitutional law. The 
authority of the PNG AGO to become a Parliamentary Auditor is 
entrenched in the Constitution and was amplified in the Audit Act 
(1989) to include inspection and audit of accounts, finances, and 
property of all arms, departments, agencies, and instrumentalities of 
the national government, as well as all bodies set up by an act of 
Parliament or by an executive or administrative act of the national 
executive for governmental or official purposes. The Audit Act 
elaborates on the provisions of Section 214 of the Constitution by 
expanding the mandate of the PNG AGO to include the audit of provincial 
governments, together with their arms, agencies, and instrumentalities.

Under the Constitution and the Audit Act, the objective of the PNG AGO 
is to conduct independent audits and examinations that provide 
professional and objective information, advice, and assurance to the 
PNG Parliament on the financial operations of the PNG public sector.

SAI Independence:

Section 213(i) of the Constitution of PNG guarantees the independence 
of the Auditor-General in terms of planning, executing, and reporting 
on audits performed as the Parliamentary Auditor. Section 20 of the 
Audit Act amplifies the constitutional provisions by giving the PNG AGO 
powers to appoint its officers and set its own terms and conditions of 
employment within the finances provided to it, as stipulated under 
Section 21 of the same act.

Audit Planning:

Effective in the year 2000 and after the Auditor-General's Office 
finalized the task of documenting its audit processes and procedural 
guidelines for compliance and attestation audits, the planning and 
execution of audit work has been performed in accordance with 
international standards on auditing and guided by professionalism, 
independence, ethics and integrity, objectivity, and responsiveness in 
serving the state and public interest with commitment and excellence. 
Audit work is executed in the following three stages.

* The Annual Plan is formulated within the broad context of the PNG AGO 
Corporate Plan. For each of the three major portfolios--the national 
government departments; provincial and local level governments; and 
statutory bodies, government-owned companies, and project audits--it 
spells out the staff days required to perform the audits as well as the 
staff days available from the audit operations staff. Audits to be done 
in-house by AGO staff and those to be done by contract auditors are 
also identified so that a strategy to identify shortfalls in manpower 
is put in place.

* Entity-oriented field plans specify in detail the financial 
statements and records to be audited, including specific staff 
allocations. The field plans also specify the scope, nature, timing, 
and extent of procedures to be applied as well as other requirements, 
including detailed reviews of internal control systems.

* Audit programs are developed for each audit. These programs put in 
place the nature, timing, and extent of specific audit procedures for 
each financial statement component (auditable area); the timing and 
extent of specific audit objectives (for each auditable area); and 
assertions to be verified, materiality levels, etc.

All audits undertaken by contract auditors are reviewed in-house and 
the reports are finalized by AGO staff.

Organization, Size, and Types of Work Done:

The PNG AGO is currently organized into two wings, operations and 
support services.

The audit operations wing is further divided into three branches, each 
of which performs specific audits through its respective divisions. The 
AGO has been structured so that its branches and divisions can address 
accountability, transparency, and related governance issues in the 
public sector. The three branches and the operations divisions under 
them are as follows.

* The National Government Branch. Under this branch, the National 
Government Expenditure Division is responsible for auditing the 28 
national government departments and their agencies, while the Public 
Accounts and Revenue Division is responsible for the audit of the 
Public Accounts of PNG.

* The Provincial Government and Local Level Governments Branch has two 
divisions, which share the task of auditing the 19 provincial 
governments and their business arms, as well as the 286 local level 
governments and their business arms.

* The Statutory Bodies and Special Audits Branch houses two divisions. 
The Statutory Bodies Division audits all public bodies and their 
subsidiaries and government-owned companies. The Special Audits 
Division is responsible for project audits, performance audits, and 
audit investigations.

The support services wing comprises two divisions, the Finance and 
Administration Division and the Corporate Services Division. The 
latter, among other functions, oversees strategic as well as 
operational planning and implementation functions, the human resources 
management function, and the legal services unit. The division also 
develops various operational and administrative systems for the office.

In all, the PNG AGO employs 109 staff, 82 of whom are attached to audit 
operations. The branches are headed by First Assistant Auditors-
General, while the divisions are headed by Assistant Auditors-General. 
Together with the Auditor-General and the Deputy Auditor-General, they 
constitute the PNG AGO's senior management. Middle management comprises 
section heads designated as Directors of Audit/Managers. Various levels 
of auditors--Senior Auditors, Principal Auditors, and Senior Principal 
Auditors--perform under each section head. As shown in table 1, AGO 
divisions and branches are currently required to perform 1,478 audit 
jobs annually, and these jobs take a total of 11,584 staff days per 
year. (One staff day is defined as 7.21 hours of audit work per auditor 
per day.)

Table 1: PNG AGO Audit Jobs Required Annually:

Division: Provincial and local level governments;
Audit jobs: 1,095;
Staff days: 3,767.

Division: Line departments;
Audit jobs: 28;
Staff days: 2,245.

Division: Public accounts and revenue-generating agencies;
Audit jobs: 10;
Staff days: 1,929.

Division: Programs and projects;
Audit jobs: 10;
Staff days: 50.

Division: Statutory bodies;
Audit jobs: 335;
Staff days: 3,593.

Audit jobs: 1,478;
Staff days: 11,584.

[End of table]

Human Resources Management:

The PNG AGO has always sought to improve its staff 's abilities to 
perform their jobs by continuing to impart the necessary knowledge and 
skills through in-house seminars and workshops as well as on-the-job 
training through attachments to audit offices overseas. Giving staff 
the opportunity to pursue professional development courses leading to 
membership in various professional accounting bodies has been a 
priority, with the AGO assisting staff with payment of membership and 
examination fees. The AGO has also strengthened and undertaken an 
ongoing review of the terms and conditions of employment, while 
maintaining its policy of recruiting graduates to fill various 
positions within the office. All these activities are aimed at 
improving the AGO's human resources management.

The AGO has put in place its Five-Year Training Programme, 2000-2005, 
which provides strategic direction on the knowledge and skills that 
staff need in order to perform their audit and other tasks. The program 
is incorporated into the Human Resources Strategic Framework contained 
in the AGO Corporate Plan (2000-2010).

The office is also finalizing a report that will provide essential 
inputs to the overall training and staff development agenda for the 
AGO. The AGO Institutional Strengthening Project has become an integral 
part of the PNG Government Public Sector Reform agenda, which is being 
funded through an Asian Development Bank loan. This project is expected 
to strengthen the PNG AGO's ability to audit for impact by enabling it 
to perform audits more efficiently, add value to systems, and develop 
best practices and methods in auditee organizations. It is expected to 
cost 3.8 million Kina (US$1.4 million) over a period of 3 years. This 
funding will only address a few selected components of the AGO 
Corporate Plan.

The project will focus not only on the human resources aspect of 
training and staff development, but also on modernizing audit processes 
and the equipment of the PNG AGO, as defined in the AGO Corporate Plan. 
The Corporate Plan aims at enhancing the capacity of the AGO to perform 
not only the compliance and attestation audits it currently handles, 
but also the value-for-money and forensic audits required under the AGO 

For additional information, contact: Office of the Auditor-General of 
Papua New Guinea, fax: ++675 325 28 72; e-mail:

[End of article]

Reports in Print:

The Institute of Internal Auditors (IIA) continues to publish its 
magazine The Internal Auditor, an invaluable resource for all Journal 
readers. In the October 2003 issue, the article "Savvy Solutions for 
Small Audit Shops" tells how small audit staffs can address challenges 
such as human-resource constraints, tight budgets, and the imperative 
to do more with less. When staff sizes are limited, circumstances can 
arise that large audit offices are not likely to encounter. For 
example, if a member of a small audit team leaves the department, a 
well-planned audit agenda can be decimated, and replacing the team 
member can be very difficult. To overcome these challenges, the article 
describes seven strategies that illustrate ways in which small audit 
offices have succeeded in making the most of limited resources and 
maximizing their impact. These strategies are (1) define the risks, (2) 
choose staff wisely, (3) set aside time for consulting, (4) expand your 
network, (5) amplify outside resource engagements, (6) trumpet auditing 
capabilities, and (7) use technology wisely. The article also describes 
the advantages of small audit offices, such as reduced bureaucracy, 
streamlined processes, and easy access to senior management. For more 
information about the magazine and the IIA, contact The Institute of 
Internal Auditors, 247 Maitland Avenue, Altamonte Springs, Florida 
32701-4201, USA; Web site:

The Audit Office of New Zealand has issued its Report of the Controller 
and Auditor-General for 2003. The report, Managing Threats to Domestic 
Security, examines the wide range of arrangements in place to identify 
and respond to domestic security threats. To carry out its work, the 
Audit Office looked at (1) the adequacy of the framework in place to 
guide domestic security efforts, (2) the collection and dissemination 
of relevant intelligence, its coordination, and its sufficiency to 
address risks, goals, and objectives, (3) the preparedness and 
capabilities of various agencies to respond to domestic threats, and 
(4) the effectiveness of arrangements for monitoring and evaluating the 
allocation of resources used to achieve domestic security goals. For a 
copy of this report, contact the Audit Office of New Zealand, Private 
Box 3928, Wellington, New Zealand; telephone: ++04-917-1500); Web site:

E-government denotes the planned and coordinated use of information and 
communication technologies to perform functions for public 
institutions. These technologies can be introduced where good 
infrastructural facilities already exist, such as in industrialized 
countries. However, according to the article "E-government for Poor 
Countries?" in the June 2003 issue of D+C: Magazine for Development and 
Cooperation, e-government can also be feasible for certain purposes in 
less developed countries. The article details the benefits of E-
government --such as greater efficiency, improved public services, and 
better transparency. For example, a municipal authority in Bangladesh 
recently introduced an electronic register of births to replace an 
outdated manual system. As a result, the data management and supply 
information processes now take only a fraction of the time they took 
previously, and the risk of mistakes has been lowered. E-government can 
also boost the efficiency of public institutions, thereby saving 
taxpayers' money by increasing staff productivity and cutting 
procurement and contracting costs. However, the article cautions that 
e-government may not always result in greater efficiency automatically 
or overnight, and substantial initial and follow-up investment is often 
required. To see the complete article and other issues of this magazine 
(published in German, English, Spanish and French), contact InWEnt 
(International Weiterbildung un Entwicklung, or Capacity Building 
International, Germany), Tupenfield 5, Bonn D-53113, Germany; 
telephone.: ++49-228-2434-5; fax: ++49-228-2434-999; Web site:

The U.S. General Accounting Office (GAO) has published a report, U.N 
Peacekeeping: Transition Strategies for Post-Conflict Countries Lack 
Results-Oriented Measures of Progress (GAO-03-1071, September 2003), 
examining the United Nations' transition strategies for its 
peacekeeping efforts in Sierra Leone, East Timor, and the Democratic 
Republic of the Congo. The report concludes that "attempts to rebuild 
nations and keep peace after conflict are useless without adequate 
measures of progress." GAO states that "although the U.N. uses some 
indicators to manage the withdrawal of peacekeeping troops, the U.N. 
does not have results-oriented measures to assess the security 
situation in the countries examined. Subsequent events in each country 
have proved that the situation was not as secure as available measures 
indicated." For example, the report notes that a goal of training over 
2,000 police in East Timor was based on a standard European police-to-
population ratio using outdated population estimates. As a best 
practice model, the GAO report cites strategies developed by the U.S. 
Department of Justice for strengthening judicial independence: (1) 
identifying the country's needs, (2) identifying a measure of output 
for strategies implemented, (3) creating a specific measure of specific 
outcomes, and (4) identifying measures of the impacts on the underlying 
conditions in the country. For more on the GAO report or to download or 
order a copy of it, see the GAO Web site,

[End of Reports in Print]


Governing Board Convenes, INTOSAI Celebrates 50th Anniversary in 

Special Program Honors 50th Anniversary:

From October 13-15, 2003, INTOSAI's 50th anniversary was highlighted at 
the Governing Board's 2-day business meeting and special 1-day 
commemorative program in Budapest. Following the Board meeting, SAI 
heads from 15 other national audit offices joined the 18-member Board 
for a program that included technical and ceremonial sessions tracing 
the organization's history and accomplishments since it was founded in 
Havana, Cuba, in 1953. The technical session included welcoming remarks 
from the chairman of the INTOSAI Board, Dr. Ock-Sup Noh of the Republic 
of Korea, followed by a lecture on the interpretation of the Lima 
Declaration by Dr. Attila Chikán, Rector of Budapest University. A 
presentation on the independence of SAIs by Secretary General Franz 
Fiedler focused on this most critical aspect of supreme audit 
institutions, and Dr. Arturo González de Aragón, Auditor General of 
Mexico, concluded the technical session with a presentation on the 
benefits of INTOSAI to SAIs.

[See PDF for image]

Photo caption: Auditors general, staff, and accompanying persons from 
over 35 countries gather on the steps of the Hungarian Parliament 
building in Budapest as part of INTOSAI's 50th anniversary celebration.

[End of figure]

The ceremonial session was conducted in the main chamber of the 
Hungarian Parliament. This part of the anniversary program featured 
welcoming remarks from Dr. Arpad Kovacs, President of the Hungarian 
State Audit Office and host of the program, and a speech on the 
relationship between SAIs and the parliament by Dr. Ferenc Wekler, 
Speaker of the Hungarian Parliament. The session concluded with a 
comprehensive speech on the history of INTOSAI by Secretary General 
Fiedler, followed by a reception in the elegant Parliament reception 

[See PDF for image]

Photo caption: Dr. Arpad Kovacs, President of the Hungarian State Audit 
Office, officially opens the 50th anniversary ceremony in the main 
chamber of the Hungarian Parliament.

[End of figure]

A special 50th anniversary publication is being produced jointly by 
this Journal and the General Secretariat. It will include the full text 
and photographs of these proceedings, as well as additional historical 
information about INTOSAI and its many programs. The publication will 
be issued in each of INTOSAI's five official languages (Arabic, 
English, French, German, and Spanish) and distributed at the INTOSAI 
Congress in Budapest in October 2004.

Board Focuses on Strategic Plan:

At its business meeting on October 13-14, 2003, the Board dedicated a 
significant amount of time to discussions and debate on the report of 
its Strategic Planning Task Force. Mr. David M. Walker, Comptroller 
General of the United States and Task Force chairman, reported on the 
Task Force's work since the Board's 2002 meeting and presented the 
proposed plan, which covers goals related to professional standards, 
capacity-building, knowledge-sharing, and related governance issues. A 
lively and engaging discussion ensued with Board members and observers 
alike debating and contributing to the dialogue. There was broad-based 
support for the plan, and the Board approved a resolution adopting the 
Task Force's report, including the following points:

1. The Board endorsed the Strategic Planning Task Force's three 
proposed strategic goals and key related principles (see the following 

2. The Board endorsed the Strategic Planning Task Force's plan to 
consider comments received at the Board meeting--and other comments 
that were to be received by November 15, 2003--for inclusion in a 
revised proposed plan, including any related to governance issues and 
amendments to the Statutes. The Task Force will solicit comments from 
the regional working group general secretariats in connection with any 
proposed changes to the Statutes.

3. The Board endorsed the Strategic Planning Task Force's proposed 
process and timeline, including consideration of a final proposed 
strategic plan and any related amendments to the Statutes at the 2004 
Congress in Budapest.

Figure 1: INTOSAI Strategic Plan Overview:



INTOSAI is an autonomous, independent, professional, and non-political 
organisation established to provide mutual support, foster the exchange 
of ideas, knowledge, and experiences, act as a recognized voice of SAIs 
within the international community, and promote continuous improvement 
amongst a diverse range of member supreme audit institutions (SAIs).


Promote good government by enabling SAIs to help their respective 
governments improve performance, enhance transparency, ensure 
accountability, maintain credibility, fight corruption, promote public 
trust, and foster the efficient and effective receipt and use of public 
resources for the benefit of their citizens.

Core Values:


Strategic Goals:

1. Accountability and Professional Standards;

2. Institutional Capacity Building;

3. Knowledge Sharing and Knowledge Services;

4. Model international organization.

[End of figure]

The Task Force subsequently met in Washington, D.C., December 1-2, 
2003, to further develop the plan and to address and incorporate the 
comments received from INTOSAI members before and after the Board 
meeting. At that meeting, the Task Force proposed a new goal (strategic 
goal 4--model international organization) based in large part on a 
recommendation made by Portugal at the October 2003 Board meeting. This 
goal includes a number of recommendations to help ensure the successful 
achievement of the plan's three other strategic goals.

As this issue of the Journal goes to press, the proposed plan has been 
sent to the Board for authorization to send it to all 185 INTOSAI 
members for their review and comment. In his letter to Board members, 
Mr. Walker wrote on behalf of the Task Force, "As Chairman of the 
Strategic Planning Task Force, I believe that this first-ever strategic 
plan for INTOSAI will be instrumental in guiding an already successful 
international organization toward becoming a model international 
organization for the future. The Task Force looks forward to continuing 
to work with the Governing Board on this important initiative."

[See PDF for image]

Members of the INTOSAI Board's Strategic Planning Task Force take a 
break from their deliberations at their December 2003 meeting in 
Washington, D.C., to pose for a photo.

[End of figure]

A special Board meeting will be convened in Vienna, Austria, June 21-
22, 2004, to review and approve the plan that ultimately will be 
presented for approval by INTOSAI's members at the Triennial Congress 
in Budapest in October 2004.

Other Business:

The Board heard a number of reports from committees, working groups, 
and the General Secretariat and made the following decisions:

* On the recommendation of the General Secretariat, amended the 
Statutes related to a change in the Law on Associations of the Republic 
of Austria.

* Accepted the auditor's annual report and unqualified opinion on 
INTOSAI's financial statements.

* Accepted the report and work program of the newly created Task Force 
on Anti-Money Laundering.

* Accepted the reports of INTOSAI's eight committees and working 
groups, this Journal, and IDI.

* Noted that five new members of the Board will be elected at the 2004 
Congress to replace five current members, whose terms come to an end at 
the Congress.

* Noted that the 17th UN/INTOSAI seminar, on the subject of SAI 
independence, will be held in Vienna, Austria, April 19-23, 2004.

* Accepted reports on the preparations for the 18th INCOSAI and 
appointed the following theme rapporteurs: Theme I (United Kingdom, 
Bhutan, Austria, Mexico, South Africa, Czech Republic, Cuba, and Ghana) 
and Theme II (Canada, Tunisia, Switzerland, Fiji, Peru, New Zealand, 
Cameroon, and Burkina Faso).

* Accepted the report of the host of the19th INCOSAI (Mexico, 2007) on 
preliminary preparations for that Congress.

For more information on the Board meeting or for copies of reports 
tabled at the meeting, contact the General Secretariat at or the meeting host at

Regional Course in Public Debt Auditing in OLACEFS:

As reported in earlier issues of the Journal, the INTOSAI Public Debt 
Committee has been working together with IDI and OLACEFS to develop and 
deliver a pilot program to enhance the way that SAIs manage their 
auditing of public debt. The first regional public debt auditing 
training course was delivered to 24 OLACEFS auditors in Cartagena de 
Indias, Colombia, from October 27-November 7, 2003. Participants 
included auditors from 10 SAIs--Argentina, Bolivia, Brazil, Colombia, 
Chile, Ecuador, Paraguay, Peru, Uruguay, and Venezuela. The course 
instructors had been participants in the 5-week "champions" workshop 
held in Mexico in April and May 2003. A second course is planned for 
the SAIs of Central America in 2004. Also, the instructors will support 
the SAI of Venezuela in a pilot debt audit planned for early 2004.

This course will provide immediate benefits to OLACEFS. The region can 
now count on 24 skilled auditors who possess knowledge of public debt 
issues and have been trained under a rigorous course structure. In the 
future, their public debt audits will be better planned, will be more 
in-depth, and will offer a comprehensive evaluation of public debt 
encompassing budget, economic, and fiscal effects.

The Public Debt Committee, in conjunction with IDI and the INTOSAI 
regions, will also be taking steps for translating a finalized version 
of the 2-week course into other INTOSAI languages. In order to extend 
the benefits of the public debt auditing training program to other 
regions, it will be necessary to adjust the design of the training 
program to meet the specific needs of each region.

[End of article]

INTOSAI Development Initiative: IDI Update:

IDI Update keeps you informed of developments in the work and programs 
of the INTOSAI Development Initiative. To find out more about IDI and 
to keep up to date between editions of the Journal, look at the IDI 
website: [Hyperlink,].

Enhancing the Pool of Training Specialists in Anglophone Africa:

A Course Design and Development Workshop (CDDW) was the focus of 
AFROSAI-E in November 2003. The workshop was led by the subregion's own 
training specialists, with audit practitioners who had completed one of 
the three previous AFROSAI-E Instructional Techniques Workshops 
comprising the participants. As a result of the workshop, a 5-day 
course on Detection of Fraud and Irregularities was developed for 
future delivery in the region. In addition, participants who 
successfully complete the workshop's requirements will be awarded an 
IDI Training Specialists Diploma.

Performance Auditing in ARABOSAI:

A 2-week Performance Audit Workshop, including a module on fraud and 
corruption, was delivered to a group of 25 ARABOSAI auditors at the 
beginning of December 2003. The workshop was delivered by a number of 
ARABOSAI's training specialists.

IDI's EUROSAI Program Looks Eastward:

A meeting was held in Oslo, Norway, November 17-19, 2003, to plan the 
delivery of the IDI/EUROSAI Phase II Long Term Training Program (LTTP) 
for countries in Eastern Europe, the Balkans, and Central Asia. A 
training consultant and IDI training specialists from EUROSAI and 
ASOSAI attended the meeting, as did a subject matter expert from the 
SAI of Russia.

The second activity of the Phase II LTTP, a Course Design and 
Development Workshop to be delivered in both Russian and English, will 
be held in Sofia, Bulgaria, April 26-June 4, 2004.

ASOSAI Symposium for Training Specialists:

At the recent 9th ASOSAI Assembly, the IDI proposal to hold a regional 
symposium for training specialists was approved. All of IDI's graduate 
training specialists in the ASOSAI region will be invited to the 
symposium, which will be held in Thailand from March 29-April 2, 2004. 
The main objectives of the symposium will be to enhance and upgrade 
training specialists' skills and to start preliminary course design 
work on several topics suggested by ASOSAI, such as the audit of fraud 
and corruption, and good management of public audit. It is expected 
that some of these course designs will subsequently be developed into 
full training courses.

Environmental Auditing Project:

The first delivery of a pilot 2-week environmental auditing workshop 
was held in Turkey November 3-14, 2003. The workshop is the first fruit 
of the cooperative project between IDI and the INTOSAI Working Group on 
Environmental Auditing (WGEA). A total of 29 participants from 15 
ASOSAI member SAIs attended the workshop, which was designed using 
IDI's training methodology. An instructor team comprising eight 
training specialists from AFROSAI-E, ASOSAI, EUROSAI, and SPASAI 
delivered the workshop. By the end of the 2 weeks, each participant had 
prepared an environmental audit proposal and action plan to submit to 
their SAI's management upon return. The second delivery of the workshop 
is planned for AFROSAI-E in 2004.

CAROSAI Completes the Long Term Regional Training Program:

Following the Regional Audit Workshop in Trinidad and Tobago in 
November 2003, CAROSAI becomes the latest INTOSAI region to complete 
IDI's Long Term Regional Training Program (LTRTP). The LTRTP is a 
comprehensive series of workshops and training-related events that 
helps a region build its training capacity. CAROSAI now has a pool of 
regional trainers who can be used at both the national level and in any 
future regional course deliveries. The Trinidad and Tobago workshop saw 
eight recently graduated training specialists delivering an 8-day 
financial audit workshop combined with a 2-day fraud module to 30 
participants from 18 SAIs in the region.

Web Site Changes Planned:

The IDI web site ( has been operational for over 2 
years, and IDI is planning to upgrade its functionality and content 
during 2004. IDI invites comments from users, particularly from 
developing and emerging countries. If you are a Web site user and would 
like to help by answering a brief questionnaire (available in Arabic, 
English, French, and Spanish) please contact Patrick Callaghan (e-mail:; fax: ++47 22 24 10 24; telephone: ++47 22 24 
11 14).

Contacting IDI:

If you would like to discuss any of the issues raised in this edition 
of IDI Update, please telephone ++47 22 24 13 49 or e-mail 

[End of IDI Update]

INTOSAI 2004 Events:

January 8-21: ASOSAI Instructors' Meeting (Audit of Privatization), 
Tokyo, Japan.

February 2-13: Pilot OFACEFS public debt audit, Venezuela;

February 10-11: Internal Control Standards Committee, Brussels, 

February 16-27: AFROSAI-E Environmental Auditing Workshop, Kenya.

March 28-30: EUROSAI IT Working Group Meeting, Bern, Switzerland;

March 29-April 2: ASOSAI Regional Symposium for Training Specialists, 
Bangkok, Thailand.

April 19-23: 17th UN/INTOSAI Seminar, Vienna, Austria;

April 26-June 4: EUROSAI Phase II Course Design and Development 
Workshop, Sofia, Bulgaria.

May 4: ARABOSAI meeting, Amman, Jordan;

May 24-28: SPASAI, Apia, Japan;

May 30-June 2: Working Group on Environmental Auditing and the 
International Congress of Environmental Auditing, Brasilia, Brazil.

June 21-22: INTOSAI Governing Board (extraordinary meeting), Vienna, 

June 28-30: EUROSAI Working Group Meeting, Bern, Switzerland;

June TBD: Public Debt Committee, Moscow, Russia.

October 10-16: 18TH INCOSAI, Budapest, Hungary.

Editor's Note: This calendar is published in support of INTOSAI's 
communications strategy and as a way of helping INTOSAI members plan 
and coordinate schedules. Included in this regular Journal feature will 
be INTOSAI-wide events and regionwide events such as congresses, 
general assemblies, and board meetings. Because of limited space, the 
many training courses and other professional meetings offered by the 
regions cannot be included. For additional information, contact the 
Secretary General of each regional working group.

[End of INTOSAI 2004 Events]

International Journal of Government Auditing: 

INDEX—VOLUME 30—2003: 


Kofi A. Annan, United Nations, Internal Oversight—A Key to Reform at 
the United Nations, January, p. 9. 

Sylvia van Leeuwan, Netherlands Court of Audit, The Development of 
Environmental Auditing Within INTOSAI, January, p. 13. 

Jacek Mazur, The Supreme Chamber of Control of Poland, and Brian Vella, 
Malta, Relations Between SAIs and Parliamentary Committees, January, p. 

Alfred Enoh, Cameroon, Ninth AFROSAI General Assembly, January, p. 21. 

Linda Sellevaag, International Journal of Government Auditing, XII 
OLACEFS Assembly Held in Mexico, January, p. 25. 

Alberta Ellison, International Journal of Government Auditing, 18th 
Commonwealth Auditors General Conference, January, p. 28. 

Gordon Carey, ANAO Better Practice Guides, April, p. 10. 

Jocelyn Thompson, Accountability and Audit, April, p.16. Swedish 
National Audit Office, The Creation of a New Swedish SAI, July, p. 11. 

Asif Ali, SAI Bangladesh: Work Plan for Enhancing Capacity, July, p. 

Batbayar Badamdorj, Mongolia, Overview of Reforms in the Mongolian SAI, 
October, p. 11. 

J. Graham Joscelyne, Former Auditor General of the World Bank, 
Integrated Public Sector Financial Management: A Central Role for SAIs, 
October, p. 15. 

Benjamin Ross, International Journal of Government Auditing, CAROSAI 
Convenes Its Sixth Triennial Congress in Bermuda, October, p. 19. 


Burkina Faso, January, p. 31. 
Bangladesh, April, p. 19.
Ethiopia, July, p. 20. 
Saudi Arabia, October, p. 22. 


David G. Njorge, Republic of Kenya, INTOSAI Marks 50 Years, January, p. 

Paul R. S. Allsworth, Cook Islands, Governmental Auditing in the South 
Pacific Region: A Cook Islands Perspective, April, p. 1. 

Sir John Bourn, United Kingdom, INTOSAI: 50 Years of Cooperation 
Between SAIs, July, p. 1. 

Abdullah Bin Hamad Bin Saif Al Busaidy, Oman, New Initiatives in the 
State Audit Institution of Oman, October, p. 1. 


Governing Board Charts Dynamic Course at 50th Meeting, January, p. 35. 

INTOSAI Auditing Standards, April, p. 24. 

Updating Guidelines on Internal Control Standards, April, p. 25. 

Second Meeting of INTOSAI Strategic Planning Task Force, July, p. 24. 

New Web Page for Working Group on Environmental Auditing, July, p. 25. 

16th UN/INTOSAI Seminar in Vienna, July, p. 25. 

OCCEFS Capacity Building Program in Central America, October, p. 26. 

INTOSAI Working Group on the Audit of Privatization, October, p. 26. 

Annual Meeting of INTOSAI Public Debt Committee, October, p. 27. 

IDI Update, January, p. 39; April, p. 26; July, p. 28; October, p. 30. 


Bangladesh, January p. 4. 
Barbados, January, p. 4. 
Brazil, April, p. 5; July, p. 5. 
Canada, January, p. 5; July, p. 6; October, p. 6. 
Chile, January, p. 5. 
China, October, p. 7. 
Estonia, July, p. 6. 
European Union, April, p. 6. 
Hong Kong, April, p. 6. 
Hungary, April, p. 7. 
Iran, July, p. 7. 
Malta, April, p. 7. 
Mongolia, April, p. 8. 
New Zealand, October, p. 8. 
Nigeria, October, p. 8. 
Rwanda, October, p. 8. 
Saint Kitts and Nevis, April, p. 8. 
Saudi Arabia, July, p. 7. 
Switzerland, January, p. 6; July, p. 8. 
Trinidad and Tobago, July, p. 8; October, p. 8. 
United States, April, p. 9; July, p. 8. 
Vietnam, July, p. 9. 
Yemen, July, p. 9; October, p. 9. 
European Court of Auditors, January, p. 6; October, p. 9. 
International Consortium on Government Financial Management and World 
Bank Institute, January, p. 8. 
NATO, October, p. 10. 
United Nations, October, p. 10. 
World Bank Institute/International Records Management Trust, January, 
p. 8. 

[End of Volume 31, No. 1]