The First ASOSAI_EUROSAI Joint Seminar on
“Challenges for ensuring transparency and
accountability in public financial management”
Country Paper by the SAI Pakistan on
“ The importance of enhancing the quality of SAI Reports,
and their impact on Parliament with reference to ensuring
accountability and transparency”
Asia Sherazi,Director Audit,
SAI Pakistan
Sequence
• Introduction
• Accountability paradigm in Pakistan
• Initiatives taken by the SAI Pakistan for
enhancing the quality of Audit Reports
• Impact of the SAI Reports
• Way forward
2
Parliamentary financial control
(Select committees)
Approve
taxation &
expenditure
Examine
budget
estimates,
accounts &
audit
reports
Make
recommendations
3
Importance of SAI reports
• A tool for the Parliamentary financial control
and oversight
• Comprehensive and competent external
audits required for effective scrutiny by the
legislature
• Quality audit reports vis-à-vis enhanced
accountability and transparency in
governmental operations
4
Accountability paradigm in Pakistan
Legislature
Auditor
General
Accountability
cycle
Executive
Public
Accounts
Committee
5
SAI Pakistan
• Known as Auditor General of Pakistan
• Appointed by the President under Article 168
of the Constitution
• Conducts audit of all (Federal, Provincial ,
District) government entities
• Submits audit reports to the President and
Governors to be laid before the
National/Provincial Assemblies and discussed
in Public Accounts Committees
6
Initiatives taken by the SAI Pakistan for
enhancing the quality of Audit Reports
• Project to improve financial reporting and
auditing (PIFRA)
• Financial Audit Manual (FAM) and guidelines
• Quality Management Framework(QMF)
• Code of ethics
7
PIFRA
• Launched in 1994
• Audit Component facilitated Department of AuditorGeneral of Pakistan to modernize its auditing processes:
– Financial Audit Manual was prepared and implemented
– Risk based audit methodology was introduced at all the
three tiers of government
– Certification audit cycle was reduced from 22 to 8 months
– Audit Command Language (ACL) was introduced in field
audit offices, and
– AGP staff had been equipped with modern working
accessories
8
FAM & Sectoral Guidelines
• Launched in 2006
• Introduced methods and approaches based on
INTOSAI Auditing Standards & international best
practices
• Provides guidance throughout the Audit Cycle
9
QMF
• Launched in 2010
• Draws on ISSAI 40, which is an adaptation of the
International Standard on Quality Control
• Provides for quality assurance procedures at all
stages through quality assurance, control &
improvement mechanisms
10
Code of Ethics
• Adoption of COE was formalized in 2002
• COE Plan being made to ensure adherence to
Integrity, Independence, Objectivity and
Impartiality, Professional Secrecy & Non
disclosure , Competence
• Its impact would be widespread awareness of
COE among the staff of DAGP and its strict
implementation
11
Impact of SAI reports
(Audit activity 2010-2011)
Rs. In million
164,577.11
violation of Rules and Regulations
24,733.64
348,192.09
fraud,embezzlement etc.
accounting errors
127,678.70
internal controls weaknesses
recoveries and overpayments
non production of record
181,875.23
others
16,043.41
5,840.05
12
Impact of SAI reports
(Recovery made at the instance of audit)
Wing
Total amount
Audited
Federal Audit
Amount
Recovery made
placed under
at the instance of
audit observations
audit
534,700.47
27,064.45
1,195.69
4,087,080.34
220,798.43
9,193.96
828,497.15
18,3602.26
2,527.66
District Audit
186,107.57
103,830.33
870.87
Defense Services Audit
126,648.19
56,452.28
397.85
9,515,157.61
277,192.50
55,434.14
15,278,191.33
868,940.25
69,620.71
Corporate Audit
Provincial Audit
Revenue Receipts Audit
Total
Impact of SAI reports
(Systemic improvements)
Sr.
No.
Audit
sectors
Systemic improvements
1
Foreign
Affairs
Rules revised regarding utilization of Pakistan Community Welfare &
Education Fund (PCW&EF) and Fund for improvement of Government
Owned Buildings (FIGOB)
2
Federal
Legal Practitioners and Bar Councils Act being amended,
Government Provincial Governments Rules being framed to regulate regimental
funds of the Civil Armed Forces
3
Works
Public Procurement Regulatory Authority (PPRA) Rules been adopted
by Provincial Engineering Departments,
Civil Aviation Authority (CAA) and Pakistan Rangers, CAA formulating
Standard Operating Procedures to streamline its posting/transfer
procedures
14
Way forward
For SAI Reports to create rightful impact, continuous efforts
are required:
• The code of ethics should be made a part of staff contracts
• Accountability in the Supreme Audit Institution be ensured
• Internal audit function be strengthened
• Necessary dissemination arrangements for the audit reports should
be clearly laid down in the legislation
• Public Accounts Committee processes be improved
• An effective channel of communication between the civil society
and the accountability institutions should be maintained
15
Thank You
16