INTERNAL AUDIT
3.1 Enhancing Internal Controls in the Public Sector.
Internal Audit is going through a significant period of change globally. As with any other
department, there are pressures on the internal audit function to add value to an organisation.
Furthermore with the high expectation of the public for higher standard of performance for less
money the importance of internal audit in the public sector is increasing.
Internal audit is a key component of any organisation’s governance framework, and plays a
critical role in providing assurance regarding the conformance and performance of the
organisation’s systems and administrative processes. Indeed Internal Audit is a very important
part of the structure that management put in place.
With a view to improve internal control in the Civil Service, Government, in 1991, set up
Internal Control Units (ICU) in most Ministries and Departments and Internal Control Roving
Teams were constituted to service small organisations. The Ministry of Finance issued Circulars
to all Heads of Ministries and Departments in 1991, 1994, and 2001 reiterating
 the role of the Internal Control Units and the Roving Teams, and
 the responsibility of management in
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Establishing controls.
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In providing the staff of the ICU and roving teams with the necessary facilities such as
accommodation, office equipment, furniture, stationery etc.
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Approving the annual programme of work.
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Monitoring the work performed by the staff of the ICU.
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Ensuring appropriate, prompt remedial actions on reports submitted by the ICU.
After more than ten years of operation, taking in view the increasing importance of Internal
Audit, it is time for an assessment of the status of Internal Audit in the Civil Service.
The role of internal audit has evolved from that of an assessor of compliance with procedures
and controls, to a strategic partner with the organisation’s executive management. Internal
auditors can expect to be responsible for many, broad and varied tasks, ranging from assessing
the quality, economy and efficiency of business activities and controls, to advising on
opportunities to harness emerging technologies and improved business practices, including
advice on the design and application of risk management practices.
An internal audit unit is often established by management, as part of the internal control system,
and used to help monitor the effectiveness of internal control. Monitoring internal control should
include policies and procedures aimed at ensuring the findings of audits and other reviews are
adequately and promptly resolved. Accounting Officers are to:
 Promptly evaluate findings and recommendations from audits and other reviews.
 Determine proper actions in response to findings and recommendations from audit and
reviews.
 Complete, within established time frames, all actions that correct or otherwise resolve the
matters brought to their attentions.
For an internal audit function to be effective, it is essential that the internal audit staff be
independent from management, work in an unbiased, correct and honest way and that they report
directly to a high level of authority within the organisation. This allows the internal auditors to
present unbiased opinions on their assessments of internal control and objectively present
proposals aimed at correcting the revealed shortcomings.
An evaluation of the operation of the ICUs indicates that in most Ministries and Departments:
 The lack of involvement/interest of Accounting Officers in the operation and work of the
ICU.
 Responsibility for internal audit was delegated to an officer below the rank of PAS.
 No review of the work performed by staff of the ICU was carried.
 Roving teams were not provided with proper accommodation; as a result, these teams were
not able to carry out their audit function, and hence had to shift to other organisations.
 Some Accounting Officers gave instruction to their ICU to refrain from submitting adverse
reports.
 Not all audit tasks which were planned could be completed due to lack of adequate staff.
 Not enough training was provided on new modern audit approaches to improve the standard
of audit.
The International Organisation of Supreme Audit Institutions (INTOSAI) prescribes that the
attitude established by top management is reflected in all aspects of management’s actions. The
commitment, the involvement and support of top government officials in setting “the tone at the
top” foster a positive attitude and are critical to maintain a positive and supportive attitude
towards internal control in an organisation. If top management believes that internal control is
important, others in the organisation will sense that and will respond by conscientiously
observing the controls established. On the other hand, if the members of the organisation feel
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that control is not an important concern to the top management and is given lip service rather
than meaningful support, it is almost certain that management’s control objectives will not be
effectively achieved.
Resources in the public sector generally embody public money and their use in the public interest
generally requires special care. Moreover budgetary accounting on a cash basis does not provide
sufficient assurance related to the acquisition, use, and disposition of resources. Therefore
safeguarding resources, especially against loss due to waste, abuse, mismanagement, errors,
fraud and irregularities becomes a very important objective for management and the ICUs.
To achieve this important objective the ICUs require the support and involvement of every
person involved in the organisation. It is also vital that all the personnel know the role,
responsibilities, limits of authority and scope of work of the ICUs and Roving Teams.
In this regard National Audit Office proposes that government makes it mandatory for every
Ministry/Department to have an Internal Audit Charter, along the model at Appendix II, signed
by the Accounting Officer, and circulated to all staff members. This measure, it is felt, will
 Promote the concept of internal audit.
 Establish and maintain an effective internal control in the civil service.
 Contribute in enhancing good governance in the public sector.
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