sai-bhutan royal audit authority auditing and reporting on economy, efficiency & effectiveness
TRANSCRIPT
SAI-BHUTANRoyal Audit Authority
Auditing and Reporting on Economy, Efficiency & Effectiveness
PRESENTATION ON AUDITING SYSTEM IN
BHUTAN
Auditing system in SAI Bhutan
Area = 38,394 sq. Area = 38,394 sq. kmskms
Population = Population = 0.647 million0.647 million
National Language = DzongkhaNational Language = Dzongkha
Major Exports = Major Exports = Electricity, Timber, Electricity, Timber, Cement, Cement,
Agricultural Agricultural Products, Products, handicrafts etc.handicrafts etc.
Density = Density = 16/sq.km16/sq.km
(Audit Act of Bhutan, 2006)
(16th National Assembly proposed for Auditing System in Bhutan)
1963 - Accounts and Audit Organization
1970- Royal Audit Office
1974 – Department of Audit (Financial manual 1974)
1985 – Royal Audit Authority - autonomous & independent)
2005 – Constitutional Body
Kashos (Royal Edict) Issued
1970 – 4 Royal Auditors
1985 – RAA autonomous & independent)
1997
1999
2000
2005 – Constitutional Body
Reiterating independence of the RAA
Independent views on the quality of public sector activities and the stewardship of Public Funds
(People’s Representatives)
(Executing Agencies)
Independent views on the quality of public sector activities and the stewardship of Public Funds
.
Auditing & Reporting without fear, favor and prejudice on the economy, efficiency and effectiveness in the use of public resources.
Article 25.1, Constitution
of the Kingdom of
Bhutan
Article 3, of the Audit
Act of Bhutan
2006
There shall be a Royal Audit Authority to audit and report on the Economy, Efficiency and Effectiveness in the use of Public Resources.Article 44 (c), Audit
Act It shall be the duty of the Authority to promote Economy, Efficiency and Effectiveness in the use of public resources through its reports and recommendations.ACHIEVE ULTIMATE
OBJECTIVE
WHAT HAS BEEN DONE
WHAT HAS NOT BEEN DONE
Government or any of its instrumentalities
Legislature & related institutio
ns
Judicial and Judicial Bodies
Zhung Dratshang, Rabdeys & related institutions
Constitutional
Bodies
Defence & Security Services
Corporations & Financial Institutions established under the laws of the Kingdom in which the Government has an
ownership interest.
All entities fully or partly funded by the Government &
NGOs
All entities whose loans are approved or guaranteed
by the Government
All entities receiving funds, grants and subsidies directly or through the Government
Collections and contributions from the people & fund raised
through lottery
Any entity or activity upon command of the Druk Gyalpo
The RAA shall conduct without fear, favour or prejudice, the audits of the following:
Not withstanding the provisions of any laws relating to the accounts and audit of any public authority, the Parliament, if satisfied that the public interest so requires, shall direct that the accounts of such authority be audited by the Auditor General.
Section 39 of the Audit Act of Bhutan 2006“The Authority shall conduct without fear, favour or prejudice the audits of the following”
a. Government or any of its instrumentalities which include, Ministries, Departments,
Divisions, Units, Dzongkhags, Gewogs, Thromdues, autonomous bodies, foreign-assisted or special projects of the Royal Government;
Audit Jurisdictions
b. Zhung Dratshang, Rabdeys and all related institutions;
c. Judiciary and Judicial Bodies;d. Legislature and related institutions;e. Constitutional bodiesf. Defense and Security Services;g. All corporations, Financial Institutions including
the Central Bank and their subsidiaries established under the laws of the Kingdom in which the Government has an ownership interest;
Cont. Audit Jurisdictions
h. All entities including non-governmental organizations, trusts, charities and civil societies fully
or partly funded by the government; whose loans are approved or guaranteed by the government; and those receiving funds, grants and subsidies directly or through the Government and collections and contributions from people and fund raised through lottery
i. Any entity or activity upon Command of the Druk Gyalpo
Cont. Audit Jurisdictions
Scope of Audit
The Authority shall audit the following matters to ascertain whether:
(a) The amount appropriated have been expended for the specified programs and tasks within the approved
budget limits;(b) The financial transactions comply with the existing
laws and the evidence relating to items of income and expenditure are sufficient;
(c) The accounts have been maintained in the prescribed forms and such accounts fairly represent the position of the transactions;
(d) The program implementations are adequately monitored to avoid incidences of cost and time overruns;
Cont…Scope of Audit (e) The inventory of public properties is accurate and upto- date, and custody, control, management and physical safeguard measures instituted are adequate;(f) Physical assets and infrastructures reported actually exist and confirm to the required specifications and standards;(g) The available resources including human, financial and other assets are properly utilized;(h) The accounting and related system of controls, financial or otherwise including the arrangements for internal audit and internal control of cash, kind and other public property against any loss, damage and abuse are adequate;
Conti….Scope of Audit
(i) The accounts of revenue, taxes, other incomes and deposits are accurate and the systems relating to assessment, realization, recording and methods of
reporting are adequate;(j) The debts, liabilities and specific purpose funds are
recorded accurately and managed properly;(k) The ICT and other technological systems developed
are appropriate and adequate controls and security measures are instituted to prevent unauthorized access to the system; and
(l) The implementation of programs and activities are as planned and the intended objectives achieved.
Performance Audit
Financial Audit
Compliance Audit
Propriety/Regularity Audit
Special Audit
Individual reports to the agencies
Certification Report of the consolidated financial statements
Annual Audit Report
AG’s Advisory series
AG’s Occasional Paper
Direct Accountability
Supervisory Accountability
Team level
Divisional Level
Committee level
PAC/Parliament
Our Audit Framework
System Audit
Environment Audit
Thematic Audit
Role of RAA
Prior to 2006
1. Auditing
2. Investigatio
n
3. Prosecution
REPORTSAudit Reports – Issued after completion of each audit &
after providing 1 month to respond to initial audit observations
Audit Reports addressed to:
The concerned Minister & head of the audited entity
The Speaker of the N.A for the audits of the Legislative Offices
The Chairman of the NC for the audit of the National Council
The Minister of Finance for audit of Defence and certification of donor funded projects
The Chief Justice of Bhutan for audits of the courts
The Chairperson of the Board for the audits of the corporations and financial institutions
Audit Clearance Certificate
Promotion
Further Studies
Training
Post Retirement Benefits
Elections
Contract Extension
Secondment
Contents Result of the audit of the Annual Financial Statement of
the Government;
the overall financial condition and recommendation to improve the economy, efficiency and effectiveness of the govt.
Significant audit findings and recommendations for improvement of agencies
Annual Audit Report
Cases where the Authority did not receive acceptable responses or cooperation
Cases where the follow-up reports are not adequate or are not being carried out as recommended
Cont. Annual Audit Report
Follow-up of Audit Reports
Section 76 of the Audit Act of Bhutan 2006
“The Lhengye Zhungtshog, Ministries, and other concerned authorities shall be responsible to take timely follow-up actions on Audit Reports”
Dedicated Follow-up Division
- Issue reminders
- Up date the status
Audit Information Management System
Audit Information Management System (AIMS)
- All Audit Reports
- Accountability for each lapses
- Up dated on a continual basis
- Generates latest status of individual audit reports
- Produces Audit Clearance Certificate
Relations with stakeholders
Parliament through PAC Anti-corruption Commission Office of Attorney General Continuous relations with agencies Awareness programme at the grass root levels Awareness programme with ministries, departments and
Dzongkhags PAC’s hearing RAA’s participation in the conference organized by other
organizations
BHUTAN THE LAND LOCKED COUNTRY