RAA being assessed under SAI Independence Assessment Study
The Chapter 8 Section 86 of the Audit Act of Bhutan 2006 states that “The Authority may undertake a peer review by a member of peer organizations or other professional bodies from time to time to ensure consistency and high standard of auditing.” Based on this mandate, the Royal Audit Authority is currently being assessed under the Supreme Audit Institution (SAI) Independence Assessment Study. A detail of the study is highlighted as follows in an interview with the Assessment Team:
Brief introduction on the Study: How is the study designed? How it is different from SAI-PMF assessment?
The independence of a Supreme Audit Institution (SAI) is crucial to ensure its ability to carry out its work in a free and impartial manner, thus contributing to good governance, transparency and accountability. Therefore INTOSAI and the Austrian Court of Audit (ACA) in its function as the General Secretariat of INTOSAI together with the Austrian Development Agency (ADA) initiated the Peer Review Project on independence of SAIs.
The overall objective of the Peer Review Project is to enhance transparency and accountability of public finances by strengthening the independence of seven SAIs in the seven INTOSAI Regions. To this end seven SAIs, one in every INTOSAI region, will be provided with an assessment of compliance with ISSAIs related to SAI independence as well as to make recommendations for action for promoting the SAI’s independence. To this effect the Royal Audit Authority of Bhutan agreed to be peer-reviewed on the subject of independence by a team composed of the Austrian Court of Audit (ACA) and the Board of Audit of Japan.
The assessment is implemented as a peer review, conducted according to the Peer Review Guideline (ISSAI 5600), focusing on the eight principles of independence according to the Declaration of Mexico (ISSAI 10). Each of the seven peer reviews in the seven INTOSAI Regions will also include recommendations for action for promoting the reviewed SAI’s independence.
Furthermore, the results obtained in the course of the seven worldwide peer reviews will be compiled in an anonymized cross-cutting report. This report will comprise the results of the seven peer reviews conducted worldwide in parallel illustrating the problems and necessary measures in the INTOSAI regions related to the implementation of the principles of independence of SAIs.
Team composition: Name of team leader and members with their SAIs:
The ASOSAI peer review team reviewing the RAA consists of four auditors, three from Austria and one from Japan. The team leader is Mr Klemens Gundacker from ACA, he is deputy head of the department responsible for the financial statement of the state and for audit of the final accounts.
Further team members are Mr Ukai Makoto from the Japanese Board of Audit, Ms Martina Schenk, auditor at the ACA in the department for educational affairs and Ms Elfriede Hammelmueller, auditor at the ACA and working for the INTOSAI General Secretariat.
Objectives of the Study: Why the study for the RAA?
The main objective of the Peer Review Project on independence is the assessment of compliance with ISSAIs related to SAI independence (ISSAI 1: Lima Declaration; ISSAI 10: Mexico Declaration on SAI Independence; ISSAI 11: Guidelines and Good Practices Related to SAI Independence; ISSAI 12: The Value and Benefits of SAIs) including recommendations in order to trigger national actions for promoting the reviewed SAI’s independence. The report on the status of its independence shall be an instrument for the RAA for national follow-up measures and for enforcing the principles of its independence by using the report as an effective tool to approach Parliament, media, donors and the public at large.
The RAA is the representative of the ASOSAI region to participate in this global Peer Review Project. The agreement on the peer review to be conducted is based on the principles of voluntariness, partnership and mutual trust.
Scope: List of key stakeholders to include for the study.
The Peer Review at the RAA involves internal and external stakeholders. The overall goal for the peer review team by conducting interviews is to get a comprehensive view of the work and independence of RAA.
Interviews within the RAA are conducted with the Auditor General, Deputy Auditor General, Assistant Auditor Generals and other RAA staff members. External stakeholders to be interviewed include the PAC, Director of Parliament, representatives of the Ministry of Finance and the Royal Civil Service Commission.
What will the peer review report entail? When will the report be finalized and released? How will the peer review report of the RAA support the global initiatives of the IDI/INTOSAI/ASOSIA?
The peer review report will include an assessment of the implementation of the eight principles of independence at the RAA as well as recommendations for action for promoting the reviewed SAI’s independence.
· Legal status of independence
· Head and members of SAI
· Mandate of SAI
· Access to information
· Reporting audit results
· Content, timing and publishing of audit reports
· Follow-up mechanism
It is expected that the draft final report will be submitted for commenting to the Royal Audit Authority of Bhutan no later than mid-2016. The RAA is asked to provide its comments on this draft no later than three weeks after the draft report is submitted. The final report will be delivered to the RAA in the second half of 2016, presented to the management and thereafter – upon decision of the Royal Audit Authority of Bhutan – made public.
The results of the final peer review report of the RAA will be used in an anonymized way by the INTOSAI General Secretariat to compile a cross-cutting report. This cross-cutting report will also include the anonymized results of six further peer reviews conducted in parallel on the independence of SAIs of the different INTOSAI Regions and will be published by the INTOSAI General Secretariat. The cross-cutting report will be presented to the INTOSAI community at the XXII INCOSAI in December 2016.
In continuation a specific action plan based on the recommendations from the peer reviews will be drafted and adopted by INTOSAI and UN bodies as well as development partners at a conference at the end of 2017 to deliver sustainable international programmes to strengthen SAIs at national level.