15 February 2018

Liberia: Rebranding the General Auditing Commission Under a Professional Auditor General - Profile and Strategic Vision of Mr. P. Ernest Parker, CPA, Mba/Ms

opinion

Since its establishment as the government's external audit organ in 1972, the General Auditing Commission (GAC) has suffered from total leadership deficit as well as the sustained strategic visions to get it on par with other supreme audit institutions in the world vis-à-vis the African Organization of English Speaking Supreme Audit Institutions (AFROSAI-E) and the umbrella organization, which is the International Organization of Supreme Audit Institutions (INTOSAI).

This is apparently occasioned by acts of the presidency in appointing individuals with close ties, instead of appointing real professionals with the rightful skillset and leadership pedigree to keep pace with the times of professionalizing the image of the audit office and auditors. The quintessential auditor general candidate should aim at building a value orientation and professional pursuit of auditors as well as establishing a good image among auditees and the public at large, due to common knowledge within the audit world that the auditor should not only serve as a watchdog for fiscal management, but also be a beacon of hope for the citizenry in the financial management cycle.

The GAC, as a major cornerstone of the president's pro-poor governance agenda, which is meant to diametrically breakaway from the odious ethos of the immediate past, and further expand developmental objectives, is an integral part of the public financial management system, thus it should be an important carrier of good governance, transparency and accountability as well as an embodiment of the spirit of the pro-poor initiative of President George M. Weah.

Common sense would dictate that, the appointment of a competent and professional auditor-general to steer its affairs for the next seven (7) years should be a matter of utmost priority not just by the presidency but also with individuals having direct insights with the workings of the commission. It is within the scope of such motivation that I feel extremely obligated to showcase a highly competent and job readied audit professional that I sincerely believe can help the president in achieving his pro-poor agenda by rebranding the lost image of the General Auditing Commission within a shortest possible time.

As an auditor who has to his credit ten years of direct experience with the GAC, and having served as an employee and management staff under four auditor-generals (John S. Morlu to Yusador S. Gaye), I am placed in the perfect position to showcase this well-qualified leader within the audit fraternity of Liberia, whose professional competence and contributions to the deepening of our reforms as well as leading a healthy development of the audit cause from the private sector vantage point in Liberia is unmatched. Thus, this article includes a summary of the profile and strategic vision of Mr. P. Ernest Parker, CPA, an assurance, auditing and accounting professional, who in my mind is the preferred candidate for the position of auditor-general of the General Auditing Commission for consideration by His Excellency President George M. Weah.

P. Ernest Parker, CPA, has been the managing partner of the Parker & Company, LLC (formerly Parker & Associates) since 1992. He is an audit, assurance and accounting professional with over 28 years of experience in the public accounting and consulting industry. He is currently responsible for project and business management of Parker & Company, LLC. In this capacity, he manages engagements in the accounting, auditing and consulting practice--from engagement planning through execution, supervision and reporting; and keeps abreast of new and emerging issues in the accounting and audit professions including hands-on knowledge of GAAP, GAAS, IFRS and FAS pronouncements and various other pronouncements pertaining to general ledger accounting and financial statement disclosures. Mr. Parker regularly consults on a broad range of issues including strategic planning and compliance with laws and regulations in governmental accounting.

As government audit services partner, Mr. Parker supervises accounting and auditing engagements in accordance with international public sector accounting standards for governmental clients. These engagements include financial and compliance auditing, attestation and consulting engagements, as well as desk reviews and quality control reviews assessing compliance with the requirements of the Public Finance Management Act, and other applicable regulations. He has extensive experience in auditing and accounting, and in dealing with complex issues that arise during the conduct of his work.

Mr. Parker has managed numerous engagements involving teams of accountants and auditors performing on long-term and short-term assignments and has extensive experience in the preparation of financial statements and management letters in accordance with GAAP and IFRS accounting in a wide range of industry sectors including: government, banking, insurance, oil and gas, mining, manufacturing, and NGO. As an audit partner, he has developed substantial experience in all phases of the audit cycle.

He participated in the planning of audits and reviews, discussed audit progress (including significant issues); provided technical expertise when difficult audit matters arise; and performed primary and overriding reviews of working papers and reports to clients, including financial statements prepared under GAAP and IFRS and management letter comments. For government clients, Mr. Parker has conducted IT audit surveys to determine the effectiveness of controls over automated information security programs, including assigning responsibility for security, security planning, and management authorization of systems to process information.

He draws on his extensive IT experience and experience in the governmental sector, industry best practices, frame works promulgated by ISACA, GAO, and AICPA, and developed criteria tailored specifically for client environment. Mr. Parker conducts reviews to ensure compliance with COBIT framework to provide a means for establishing minimum acceptable security practices related to computer systems.

Mr. Parker has prepared and conducted training seminars for staff accountants and audit professionals as part of his firm's continuing education program. He has developed and delivered seminars to business owners under topics such as: Business Records and Taxation, Accounting and Its Use in Business Development and Cost Volume Profit Analysis. Mr. Parker has extensive international experience having managed projects in North and West Africa, Latin America, Eastern Europe, Asia and the U.K. Specifically, Mr. Parker has managed audit and accounting projects in the following countries: Liberia, Nigeria, Ghana, Morocco, Thailand, Viet Nam, the Ukraine, Croatia, Slovakia, Romania, Brazil and England, while partnering with major auditing firms including KPMG, Moore Stephens, etc. He currently partners with a number of international firms in undertaking engagements in Liberia.

Mr. Parker has overseen large, multi-site audit and consulting engagements for entities with complex organizational structures and accounting systems. He prepares numerous management letters recommending improvements in the internal controls for a wide variety of accounting systems in both the public and private sectors. Additionally, he managed the implementation of system improvements such as the standardization of accounting procedures among related entities.

As an audit partner, Mr. Parker has substantial experience in all phases of the audit cycle. He participates in the planning of audits and reviews; discusses audit progress (including all significant issues) with the audit managers or in-charge accountants; and provides technical expertise when difficult audit matters arise. He performs primary and overriding reviews of the working papers and client reports despite his top-level engagements with auditees to have their systems improved.

Mr. Parker's financial executive and consultancy portfolio has led him to building a 35 person CPA practice serving primarily government, quasi-government agencies, private sector and international non-governmental agencies, as well as management of key client relationships. He developed the firm's annual strategic marketing plan; handled firm's human resources and financial management activities and directed all business development initiatives in audit and consultancy sectors and managed engagements and projects.

To his credit, he expanded the firm's practice internationally from a base in the USA. He executed the firm's strategic marketing plan including proposal preparation; planned, organized and reported results of projects managed; supervised audit and project team. He served in various position since he embarked on the noble auditing profession, including managing partner at the Parker and Company, LLC, in Washington, D.C. and Monrovia, Liberia, from 1992 to present; manager, asset based lending at the National Bank of Washington, from 1989 to 1992; and assistant manager (last position) at the Price Waterhouse in London and Monrovia, from 1983 to 1989. He also served as an independent audit and assurance consultant for several local and international organizations.

Mr. Parker has a prodigious professional education and experience background. He obtained his Master of Business Administration (MBA) and Master of Science in General and Strategic Management from the Indiana University, Kelly School of Business; Bachelor of Business Administration (BBA) in Accounting from the University of Liberia; and an Associate Degree (AA) in Engineering from the Ricks Junior College, Monrovia, Liberia. Professionally, Mr. Parker is a Certified Public Accountant (CPA), and holds active membership in the following professional institutions: American Institute of Certified Public Accountants (AICPA) and Liberia Institute of Certified Public Accountants (LICPA).

Most importantly, Mr. Parker is a consummate team builder and player and fully understands the needs and strategic direction that the General Auditing Commission is to take to rebrand and transform to a viable organization amongst the community of supreme audit institutions. Some of his immediate action plans, when he is considered by the president to help rebuild the GAC, is to strategically work with the workforce of the commission to build morale by providing better incentives to increase job productivity as well as scout for more local and international trainings to sharpened their audit capabilities to enhance performance as required by professional standards.

He has specifically committed himself to ensuring compliance with international standards of Supreme Audit Institutions (ISSAI) in order to ensure employees achieve high standards of performance in improving the knowledge and understanding required by the standards. He envisions maintaining GAC's membership with INTOSAI while adhering to key tenets of its regulatory framework of guidelines, principles and standards. By so doing, the GAC will ensure continued compliance with international best practices followed by other member organizations. Key principles contained in ISSAI include, inter alia, transparency and accountability, independence, code of ethics and quality control.

While his key objective is to adhere to all standards, his core vision for the GAC focuses on the standard dealing with quality control. The standard requires agencies to have in place quality control policies and procedures, and adhere to the rules of evidence. Specifically agencies must verify findings and "auditees" must be given the opportunity to comment prior to finalizing the report especially in instances where reports are made public. This is a fundamental principle of auditing. Every good auditor strives to understand the entity being audited by gaining insights from the auditee's perspective and Mr. Parker perfectly understands that. His interests in the quality control standard stems from what appears to be a critical deficiency in the GAC audit methodology, which has resulted in a syndrome I like to refer to as "tabloid auditing".

While invariably disagreements between auditors and auditees will occur in the normal course of an audit the high frequency with which major differences are surfacing publicly is suggestive of fundamental failures at the quality control level.

Mr. Parker has also highlighted Risk Management as an emphasis in rebranding the General Auditing Commission. With resource limitations, the GAC has to develop an enterprise risk management framework to effectively identify, assess, and manage risk by ensuring adequate coverage of all internal and external streams of government revenues and expenditures.

The framework should ensure systems are operating effectively and provide reasonable assurance that revenue and expenditures are properly accounted for and internal controls are operating effectively. A key tenet of this framework is risk-based auditing which focuses on linking the results of internal controls assessment to the audit strategy. Among other best practices, the framework should incorporate a rotation of emphasis wherein all areas of government are covered on a rotational basis while aligning level of emphasis with associated risks. In short, the GAC will follow the money; its strategic plan will be in sync with government revenue and expenditure priorities under Mr. P. Ernest Parker's leadership.

Due to existing facts that, standards, rules and guidelines contained in INTOSAI's regulations are limited, the GAC will have to draw on other sources for guidance. For example, COSO's Internal Control--Integrated Framework or Risk Management--Integrated Framework are all good risk management models to follow. Another good model is ISACA's risk assessment methodology, which can be applied to IT environments. He has strongly promised to use these tools in rebranding the Commission, which is highly welcomed.

Mr. Parker has further promised to improve relationship with other government agencies. As the government chief accountability arm there is a common perception that the GAC must assume an adversarial stance to maintain its independence. He abhors this school of thought. He believes that an effective GAC must maintain its independence but at the same time collaboratively coordinate its war on corruption with senior officials in line ministries and other agencies such as the Liberian Anti-corruption Commission (LACC), Ministry of Justice (MOJ), Internal Audit Agency (IIA), etc., who are all committed to ensuring economy and efficiency in consumption of government resources. In addition, there are many areas in which the GAC could offer its expertise to assist government in meeting its financial management objectives. For example, the GAC's successful participation in providing independent oversight to the Integrated Financial Management Information Systems (IFMIS) steering committee is an excellent example

of the type of inter-agency collaboration He envisions. He envisions the GAC collaborating with other ministries, agencies and implementing partners in modernizing and standardizing Liberia's accounting and auditing framework including building capacity of the Liberian Institute of Certified Public Accountants.

This highly prepared professional anticipate many challenges in building on the considerable progress made thus far in making the GAC a best of class professional government audit agency and agents of good governance. He anticipates continuous challenges as the GAC systematically and methodically adopts new methods and techniques in line with environmental and technological changes.

These challenges will require strategies, organization and operations that are more complex and uncertain. With healthy GDP growth projected in the coming years, corresponding expansion in government spending is anticipated as concessions become operational and begin contributing to government coffers. The GAC will explore opportunities for incorporating audit analytics to increase its audit coverage and productivity by conducting more efficient and faster analysis to gain more insights into fraud, error and inefficiencies.

To cope with these changes, the GAC will need to advocate for increased budgetary allotment to build human and administrative capacity in line with this increase demand on its services. Moreover, as government budget and accounting processes computerize under IFMIS, common sense will dictate that the GAC develop capacity for performing IT audits. As an IT professional, he is particularly well suited to provide leadership in making sure the Commission becomes IT audit capable. In adhering to its core values and fundamental principles of auditing, the GAC has to ensure compliance with ISSAI and specifically its quality control regime and compliance with rules of evidence.

In my view, adhering to these fundamentals will go far in aiding the Commission prepare sound, accurate and complete reports and in restoring the GAC's credibility as a vital link in the accountability process. Adopting organizational change management strategies, which is essential to avoid failure as the Commission transitions and plans for the future, will be considered in helping this preferred professional build a more expanded audit platform that is needed now to transform the institution and make it serve as a true cornerstone of the president's pro-poor agenda. Mr. Parker is a trusted and dedicated public servant who is committed to implementing good governance and professionalizing GAC in a manner mentioned in this transformation agenda.

He was previously vetted for the position of auditor-general through the Civil Service Agency in 2013, under the supervision of its director-general of the Civil Service, Mr. George Kronni sanyon Werner, and was cleared of any major ethical concerns as well as criminal history though he was considered apolitical. If our objective is to bring excellence and integrity to public service as the President mentioned in his inaugural address on January 22, 2018, we call on the President to look favorably at Mr. P. Ernest Parker, CPA to head the GAC for the next seven (7) years.

Dwana B'akongo Sesay, Cfe, Cfip, Cia

Liberia

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