Deodat Sharma

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The folks at the Audit Office of Guyana are always on the lookout for more ways to better serve the people in their roles as ‘guardians of their tax dollars’ and it appears that they have found yet another.Last year the Audit Office embraced several new areas in the pursuit of improved services – one of these was the Risk Based Audit.The risk-based audit approach uses a formal and systematic analysis of the factors that may lead to errors and misstatements in financial reporting.Based on the results of these analyses, the extent and frequency of the audit tests to be conducted on various parts of an account can be determined.Low risk areas will only be subjected to the minimum audit testing as required by the International Audit Standards. Meanwhile, for higher risk areas, the audit can concentrate sufficient effort based on the risk assessment.Risk-based auditing will allow auditors to utilize their resources more effectively and also obtain more pertinent information from the audit than the current methods.The pilot audits which have all been successfully completed were presented to the National Assembly late last year.The Auditor General, Deodat Sharma, noted that if any Guyanese was interested in seeing the results of these pilot audits then they needed to go no further than the Auditor General’s report of 2009. Five agencies were audited using the Risk Based approach; among these were the Ministry of Education, the Ministry of Health and the Office of the President.According to Sharma, the 2010 Report will consist entirely of Risk Based Audits. He noted that over the last year he has been steadily training all of his staffers so that at this point almost his entire work force is versed in applying this audit approach at every agency that they visit.Value for Money Audits are also another type of audit that the AG would like to see more of. Instead of focusing entirely on the financial aspect of the agency, a VFM audit will focus on the efficiency of the agency’s operations as well as their use of resources. Administration and management are also put under the magnifying glass as well.Sharma noted that his agency had a historical first this year when they placed two reports in one year, the 2008 AG report was placed in March and the 2009 Report in October meaning that for the first time in years the office has caught up with its reporting requirements.During the year two VFM reports were also placed in Parliament, the first was that of the Pilot VFM audit undertaken at the Palms Geriatric Care Facility and the other was a VFM of the Old Age Pension Fund.Both reports revealed a number of shortcomings in the management and administration of the two institutions that not only affected the efficiency of the services that the agencies’ were offering but actually created a number of possible openings for fraudulent activities to take place.There are also several VFM Audits in the works. The VFM audit of the National Procurement and Tender Administration Board has been wrapped up and is now in its reporting stage meanwhile another is ongoing in the Ministry of Health.The VFM in the Ministry of Health is focused on the management and control of drugs and medical supplies. It will look at the procurement and control (distribution, destruction, etc) of the drugs and supplies used by Government run health centers and the Ministry of Health.The Auditor General stated that he was not at liberty to discuss the findings of these audits however since they remain confidential until the audits are laid in the National Assembly at which time the outcomes of the audits becomes public information.