12 June 2012

Ghana: Duffour Warns Internal Auditors to Stick

The Minister of Finance and Economic Planning, Dr Kwabena Duffuor, has warned internal auditors to stick to the principles of internal auditing and abide by their professional code of ethics.

According to him, internal auditors in the Ministries, Departments, and Agencies (MDAs) and Metropolitan, Municipal, and District Assemblies (MMDAs) were to ensure compliance with an entity's policies, procedures and financial laws of the country.

Dr Duffour gave the stern warning in a speech read for him by the Chief Director of the ministry, Mr. Enoch Hemans Cobbinah, at the final consultative forum on the amendment of the Internal Audit Agency Act, 2003 Act 658 in Accra, yesterday.

In the Finance Minister's own words: "You are not responsible for the executive of an entity's activity, but rather you should play your advisory role to management of the MDAs and MMDAs, by providing timely advice on how to better execute their responsibilities."

Dr. Duffour noted that if the amendments to the identified areas in the Act were effected, it would enhance and enrich the existing Internal Audit Agency Act.

It would also ensure that the Internal Audit Units (IAUs) of the various MDAs and MMDAs become more independent, and enable internal auditors carry out their duties in an objective manner, he added.

Dr. Duffour emphasised that: "if internal auditors are effective and efficient in the performance of their work, resources could be saved and channeled into priority areas that require funding."

To achieve this objective, he said, they need to empower the Internal Audit Agency (IAA) to deal with the challenges faced in the implementation of the Act, including issues of recruitment, transfers and general supervision of internal auditors serving the MDAs and MMDAs.

On his part, the Board Chairman of the Internal Audit Agency, Nii Adumansa-Baddoo, who chaired the forum, emphasised that the process of amendment initiated by the board and other stakeholders had reached its high point, with the final consultative forum that would examine feedback from the various regional workshops held last year.

The board has a legal duty to go through all these motions before other next steps are initiated to complete the amendment process, he stressed.

Nii Adumansa-Baddoo further explained that if the existing Act was amended, it would further enhance and finally secure the AII.

The Acting Director General of the Internal Audit Agency, Mr. Ransford Agyei, in a presentation, mentioned that sections 5, 12, 16, 17, and 22 of the existing AII Act were to be amended.

He, however, disclosed that if the Act was amended, salary and other emoluments of Internal Audit staff would not be changed.

Instructively, the Internal Audit Agency (IAA) was established by the Internal Audit Agency Act 2003 (Act 658) with a mandate to co-ordinate, facilitate and provide quality assurance for Internal Audit Units in MDAs and MMDAs.

The key requirements of the Act are the provision of internal auditing assurance and consulting services that will ultimately lead to the enhancement of efficiency, accountability and transparency in the management of resources in the public sector.

The creation of the Internal Audit Agency was predicated on the need for the government to put in place a structure that could support the eventual transfer of budgetary authority, and expenditure control to the MDAs and MMDAs.

These initiatives are part of the government's efforts under the Public Financial Management Reform Programme (PUFMARP).

The Act received Presidential assent on 31 December 2003, administrative transition was allowed up to 31 August 2004, and effective implementation started in 2005.

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