INTOSAI comments on the exposure draft of ISSAI X … No. 10... · performance indicators refer ... organisational level requirements for audit quality. ... 2 thReport on the 20 UN/INTOSAI

INTOSAI comments on the exposure draft of ISSAI X

Project team discussion version dated 3 September 2013 Page | 1

WGVBS: INTOSAI comments on the exposure draft version of ISSAI X

Exposure period ending on 28 February 2013

Section Exposure draft ISSAI X Comment

received from

Comment / Suggested amendments

Response and final changes recommended by

the project group

Ge

nera

l

General / Overall Canada We have reviewed with interest the Exposure Draft: ISSAI X: The Value and Benefits of Supreme Audit Institutions – making a difference in the lives of citizens. Overall, we do not have any contentious issues to highlight. Congratulations on preparing a substantive draft ISSAI. We found the references made in the footnotes to related ISSAIs to be very useful.

Noted.

Monaco We thank you for sending the exposure draft of ISSAI X. This tool is very interesting and we don't have any comments about it. The SAI of Monaco avails itself of this opportunity to reiterate the assurance of its best regards.

Noted.

Compliance Audit Subcommittee (CAS)

The Compliance Audit Subcommittee (CAS) congratulates the Working Group on the Value and Benefits of SAIs of having accomplished a valuable and history-making ISSAI on The Value and Benefits of Supreme Audit Institutions – making a difference to the lives of citizens. The document is comprehensible, to the point and placing the SAI as an institution clearly within the context of society, the constitutional arrangement of the public sector and its relations to democracy and the citizens.

Noted.

Portugal On behalf of Director-General of Tribunal de Contas de Portugal, I would like to congratulate you for the work done on producing the Draft of ISSAI X: The Value and Benefits of Supreme Audit Institutions – making a difference to the lives of citizens. We think it is a very important document as a guide for developing International Standards and we haven’t any comments to this Draft.

Noted.

Denmark Thank you for the opportunity to provide comments and input on the draft ISSAI X developed by the Working Group on the Value and Benefits of SAIs. Initially, Rigsrevisionen would like to commend the WG for having developed a well-structured document that reflects and elaborates very effectively on the essential

Noted.



principles of ISSAI 1 The Lima Declaration

Denmark By general agreement in INTOSAI only ISSAIs on level 3 and 4 are referred to as standards and hence we would suggest that references to ISSAI X in the document are made to the “principles” rather than to the “standard”/ Example: Item 5 in the preamble “This standard is …” should instead read: “These principles are …”

Project team agreed to make the suggested change. “The principles set out in this document are constructed …”

Denmark Notwithstanding the importance of SAIs, we think that the role of the respective countries’ parliaments as the commissioning entities deserves to be further highlighted in ISSAI X. Please see our specific comments on the subject in the attached appendix. Specific comments included below under the principles and guidance.

Specific comments have been considered under the relevant principles and guidance.

Denmark Taking into consideration that INTOSAI will soon have an entire new set of updated fundamental auditing principles at level 3 of the ISSAI framework, we would suggest that ISSAI X at every opportunity given includes references to the new principles.

The project team agreed to include references to ISSAIs 200, 300 and 400.

Estonia We have carefully studied the draft ISSAI X: The Value and Benefits of Supreme Audit Institutions - making a difference to the lives of citizens. We would really like to acknowledge the work of authors who have produced most useful document. We have no comments to the draft.

Noted.

Thailand Regarding to the e-mail from the Court of Accounts of the Kingdom of Morocco dated 1 November 2012, requiring us to comment on the exposure draft of ISSAI X: The Value and Benefits of Supreme Audit Institutions – making a difference to the lives of citizens, please be informed that the mentioned draft is appropriated and consisted of a completed content for the Supreme Audit Institutes which enable to be used as the International Standard and there is not any comment from our SAI.

Noted.

Lesotho Generally the draft is very good and well addressing all the key Principles, congratulations. Once again congratulations to the excellent work!!! This ISSAI is going to be of great benefit to the SAIs and the Society at large especially because in most countries the public is not familiar with the roles and responsibilities of these institutions.

Noted.



Sweden Concluding paragraph:

- Finds that all key principles has been included in ISSAI S, and that the guidance supporting each principle is appropriate, and thus endorses the exposure draft of ISSAIX

- Finds that the three objectives and the twelve principles provide adequate guidance to what SAIs have to do in relation to the executive, the citizens and stakeholders, including the public administration, to promote the value and benefits of SAIs

- Considers ISSAI X to be an essential contribution to the ISSAI framework

- Acknowledges the importance of the principles in ISSAI X, thus to be incorporated at level one of the ISSAI framework

- Emphasizes the link between the rights of SAIs in the founding principles of the Lima declaration and the prerequisites of the ISSAIs at level 2 by defining the responsibilities of SAIs towards citizens through the key principles in ISSAI X

- Acknowledges that ISSAI X underlines SAIs’ unique dual role in providing impartial information, by speaking truth to power and speaking truth to citizens

- Emphasises that democracy, accountability and its relationship to the citizens deserves adequate attention in the preamble

Noted.

Uruguay We would like to mention that, in general terms, this Court does not have any objection. However, taking into account the goal pursue by the OLACEFS, the draft includes the fundamental principles and it is a proper guide for measuring the performance of our Supreme Audit Institutions. In that sense, our court proposes the following comments: 1) Besides the fundamental principles, on the Domain

A should also consider: Performance of SAIs, which performance indicators refer on ISSAIs 200, 300 and 400. As such texts are under review by INTOSAI, it should be verified in what extent future changes will be reflected in those indicators.

It appears that the comments relate to the SAI PMF and not this ISSAI. The project team has removed the references to draft guidelines and included references to ISSAIs 200, 300 and 400.



2) From the different fields included in the evaluation, measurement should be contained in a defined period of time (that is, to fix a maximum timeframe). Moreover, it should also make sure that measurement does not stay in a single stage, but to go through revisions on a certain temporal basis, depending on the effectiveness of the tool and the fact of designing, at the same time, a plan to measure and evaluate performance within a specific period of time. This process should be repeated in specific periods or on the contrary, the application of time should be under the stipulation of the SAI.

3) Finally, even though the object of the draft is auditing itself, there is no clear explanation, in the guide, concerning the SAIs plying a preventive role (in advance), as well as to having the tools to measure performance of those SAIs.

Hungary The exposure standard is of good quality, we do not recommend any changes regarding the 3 main objectives, as listed in paragraph 5, and the 12 principles. You are kindly requested to consider some minor changes though, as follows. Minor changes are detailed below under each of the principles.

Noted. Minor suggestions were considered by the project team as set out below.

United Kingdom Thank you for the opportunity to comment on the document exposed as ISSAI X on 8 October 2012. Our answers to the Exposure Questions are provided in the Annex along with a suggestion to remove Annexure C. I would first like to thank the Project Group for producing this high quality document which captures the important role of a modern SAI. This letter however raises a more fundamental concern about how such documents relate to the ISSAI framework.

The project team has removed “Annexure C”.

United Kingdom In our view the document has considerable merit but should not be given the status of an ISSAI within the ISSAI framework. The headline principles are well drawn and relevant for all modern SAIs, as is the supporting guidance. The Preface explains the context, referencing Lima but focussing on today’s emerging expectations that SAIs should make a contribution to improving the lives of citizens. It also illustrates how SAIs might strive to bridge between Lima at Level 1 and Mexico and other standards

Noted: The Johannesburg Accords from the XX

th INCOSAI

record that the INTOSAI members support consideration of the framework as part of the ISSAI framework at level 1, once it has been refined and subject to meeting all the INTOSAI due process



at Level 2. But our concern is whether ISSAI X itself can be considered a standard. Standards generally place a direct responsibility to act on a specified subject group in dealing with issues within the locus of control of that group (for ISSAIs the group are the members of INTOSAI). The characteristic sets standards apart from guidance and helps differentiate between mandatory and aspirational material. Standards have authority and provide a clear basis for developing robust professional quality assurance criteria against which compliance with the standard can be measured. Standards should also integrate smoothly and logically into a wider standards framework thus contributing to a coherent collective integrity for the whole framework. Repetition or confusion between levels an purposes distorts the line of sight across the framework. Applying these few, but key, criteria indicates clearly to us that ISSAI X is not a standard.

requirements in consultation with the INTOSAI Professional Standards Committee. The WGVBS through the project team has been working to execute the mandate entrusted to the WGVBS. The INTOSAI due process requirements have been followed and the PSC Chair has decided to propose inclusion at level 1 of the ISSAI framework. The final decision to include the document in the ISSAI framework rests with the INTOSAI community. The intention is that the proposed ISSAI be presented and considered by the INTOSAI members during the XXI

st

INCOSAI, 2013, Beijing.

United Kingdom To treat it as an ISSAI, especially at level 1 would, in our opinion increase the risk of a critical response from stakeholders, partners and donors on three fronts – the professional rigour of INTOSAI’s standards setting processes, the coherence of its standards framework and the basis and consistency of application by its members. This external risk has increased in recent years through INTOSAI’s success in raising its profile via the UN General Assembly Resolution and, ironically in the current context, through its emergence as a standards setter for public sector auditing.


th INCOSAI

record that the INTOSAI members support consideration of the framework as part of the ISSAI framework at level 1, once it has been refined and subject to meeting all the INTOSAI due process requirements in consultation with the INTOSAI Professional Standards Committee. The WGVBS through the project team has been working to execute the mandate entrusted to the WGVBS. The INTOSAI due process requirements have been followed and the PSC Chair has decided to propose inclusion at level 1 of the ISSAI framework. The final decision to include the document in the



ISSAI framework rests with the INTOSAI community. The intention is that the proposed ISSAI be presented and considered by the INTOSAI members during the XXI

st


United Kingdom The NAO participated in the Project Group that developed this draft, as we had in the group developing the original Values and Benefits Framework for INCOSAI 2010, and we remain convinced that providing a commentary of this type has a value. We can also understand the attraction of using the ISSAI framework to publicise and promote aspirational, strategic information such as this – PSC has a very high profile amongst INTOSAI’s activities and has a widely consulted “public face” through the issai.org website. And there are precedents at Level 2 in the linked treatment applied to ISSAI 10 and ISSAI 11 and ISSAI 20 and 21. However, as outlined above, at the time INTOSAI’s external profile and adherence to effective due process were both considerably lower than is the case today. In any event we believe it is not precedent that should be applied to Level 1 and that INTOSAI’s immediate and longer term credibility as a standards setter should not be jeopardised to achieve high profile and exposure for non-standards documents.


th INCOSAI

record that the INTOSAI members support consideration of the framework as part of the ISSAI framework at level 1, once it has been refined and subject to meeting all the INTOSAI due process requirements in consultation with the INTOSAI Professional Standards Committee. The WGVBS through the project team has been working to execute the mandate entrusted to the WGVBS. The INTOSAI due process requirements have been followed and the PSC Chair has decided to propose inclusion at level 1 of the ISSAI framework. The final decision to include the document in the ISSAI framework rests with the INTOSAI community. The intention is that the proposed ISSAI be presented and considered by the INTOSAI members during the XXI

st


Czech Republic It is my responsibility to communicate the view of our audit department to the draft ISSAI X concerning value and benefits of SAIs. Representatives of our audit department state that: “We do not have any additional comments to the draft ISSAI X and in our opinion the draft includes all major principles and aspects of SAIs´ work that can be

Noted.



considered relevant for assessment of SAIs´ value and benefit to the lives of citizens. It is also well-designed with respect to the ISSAI 10-40 and draft Performance measurement framework for SAIs.” I hope that our input would be helpful and thank you for your efforts in developing the ISSAI X.

Venezuela The International Standards of Supreme Audit Institutions ISSAI:

Establish basic requirements for SAIs´ proper functioning and professional conduct, and fundamental audit principles of public entities.

Provide guidance or direction. While traditionally they usually are general, we find that the ISSAI X:

Adjusts to the fundamental purpose of the Lima Declaration to defend independence in auditing of public administration.

Ensure that the processes of accountability and transparency are adequate.

Aims to enable the empowerment of citizens as an important part of a healthy and responsible audit cycle.

Take care with zeal of effective communication with stakeholders.

Looks forward to ensure good governance of the SAI.

Covers the fundamental aspects to be addressed in each principle.

Noted. The project team acknowledges the key points highlighted by the SAI.

Venezuela With regard to human capital, and in line with the provisions of the Human Resources Management Guide by the INTOSAI´s Capacity Building Committee (CBC), the exposure draft ISSAI X, could insist on the need to strengthen a motivated staff in sufficient numbers to perform their functions, and on the implementation of best practices by SAIs concerning to recruitment, retention, rotation and promotion of staff, thereby to ensure a modern and strategic management of human resources, and meet the changing needs of staff.

We agree with the importance of human resources but we want to ensure that the ISSAI remains high-level, thus do not want to go into too much detail. Principle 12 already refers to the document “Building capacity in Supreme Audit Institutions – A guide”, that covers these issues as part of developing a human resource strategy.

Germany The German SAI does not intend to comment on the content of the exposure draft. We would however like to

Comments on the classification of ISSAI X do not form part of



clarify our understanding that comments on the classification will be discussed apart from the exposure procedure.

the exposure procedure. The cover letter distributed with the exposure draft confirmed that the classification of ISSAI X falls outside the exposure process.

Peru In general, we agree with the principles comprised in the draft, as they aim to highlight that the purpose of control is to contribute to the generation of value for citizens. Such purpose will be achieved through the promotion of efficiency, effectiveness, responsibility and transparency in the public administration. We should also mention that this document is lined up with the Declaration of Lima, where is established that independence of SAIs is an indispensable platform for government control to be carried out with objectivity, fairness; and sustained on professional, technical and legal standards. Article 5 of the Lima Declaration states: “Supreme Audit Institutions can accomplish their tasks objectively and effectively only if they are independent of the audited entity and are protected against outside influence”. Likewise, notes that the degree of their independence shall be laid down in the Constitution; therefore, legislation and democracy constitute essential premises of a real independent audit in the Public Administration. Those are the pillars the Lima Declaration is based on.

Noted. The project team acknowledges the points highlighted by the SAI.

Malaysia SAI of Malaysia would like to congratulate the Working Group on the Value and Benefits of SAIs project group in developing the exposure draft of ISSAI X. After reviewing the exposure draft ISSAI X, we agree to what have been proposed and have no objection for the exposure draft.

Noted.

USA This letter provides the U.S. Government Accountability Office’s (GAO) comments for the International Organization of Supreme Audit Institutions (INTOSAI) Working Group on the Value and Benefits of SAIs’ (WGVBS) exposure draft entitled The Value and Benefits of Supreme Audit Institutions – making a difference in the lives of citizens. GAO supports the WGVBS’s efforts to implement the Johannesburg Accords’ Framework for

Noted. The project team acknowledges the importance of this ISSAI being an enduring document.



Communicating and Promoting the Value and Benefits of SAIs (Framework). In our view, the proposed International Standard of Supreme Audit Institutions (ISSAI) represents an important step in this direction. In accordance with the due process for INTOSAI Professional Standards, in January 2013, the Professional Standards Committee Chair ruled that this exposure draft will be incorporated into level 1 of the ISSAI framework, where it will take its place alongside the Lima Declaration as ISSAI 2, once it is approved and adopted. We reviewed the exposure draft with the perspective that as a level 1 Founding Principles document, ISSAI 2 will not be subject to regular review or revision and as such needs to be written in a manner that will endure over time.

USA The 12 principles outlined in the draft ISSAI 2 encompass many of the prerequisites for the function of Supreme Audit Institutions (SAI) already established in level 2 of the ISSAI framework. Therefore, we believe that it is important to consider reexamining the related level 2 documents to make sure that key principles and prerequisites are appropriately aligned as the ISSAI 2 exposure draft is finalized. Linking the level 2 prerequisites for the proper functioning and professional conduct of SAIs to the principles in the foundation document at level 1 will promote consistency and clarity for users of the standards.

The project team recognizes the importance of alignment with level 2 documents. The project team feels that this has been achieved.

Mauritius SAI Mauritius has no comments on the Exposure Draft ISSAI X.

Noted.

Cyprus Further to your letter of 8.10.2012, please note that we have no comments on the exposure draft. We find the exposure draft and generally its guidance appropriate and very helpful.

Noted.

Mexico First of all, I would like to apologize for the late submission of comments to the exposure draft of ISSAI X: The Value and Benefits of SAIs – Making a Difference to the Lives of Citizens. Hereby I kindly ask the responsible task team for its support considering these comments. Additionally, we would like to express our thankfulness. The responsible task team considered most of the

Noted.



comments previously submitted by our SAI in July 2012, and the exposure draft reflects relevant modifications according to the WGVBS members’ feedback. We acknowledge the effort made, particularly regarding the charts included and the comparison between the ISSAI X (2) and the original Framework for Communicating and Promoting the Value and Benefits of SAIs. Through the submission of this document, at the SAI of Mexico we sincerely hope to contribute to the final drafting of this relevant ISSAIs.

Australia The Australian National Audit Office recognises the importance of and supports the continuing development of the International Standards of Supreme Audit Institutions. We appreciate the opportunity to comment on the Exposure Draft ISSAI X: The Value and Benefits of Supreme Audit Institutions – making a difference to the lives of citizens and acknowledge the efforts of the working group in producing this document. I apologise for our late response. We believe that the three objectives and twelve principles enunciated in the document are relevant to communicating the role and value of an SAI to citizens and other stakeholders, as well as to the staff of an SAI, and the importance of such communication is acknowledged.

Noted.

Australia We note, however, that some principles and guidelines are high-level, aspirational statements and are not in the nature of requirements that can objectively be complied with. One such example is guideline 5.1 which states that SAIs should “be aware of expectations ...” and “respond ... as appropriate, in a timely manner”. This is a critical behaviour for SAIs but, in the absence of criteria, would seem to be difficult to assess objectively.

The project team acknowledges that these principles are collectively aspirational. Accordingly this ISSAI is not designed as a detailed measurement tool. Similar to the Lima Declaration, it should work together with other material in the ISSAI framework.

Australia On the other hand, some principles and guidelines in the Exposure Draft which relate to independence and to SAIs being model organisations are already requirements

The Johannesburg Accords from the XX

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that the INTOSAI members



in existing ISSAI Level 2 standards (Prerequisites for the Functioning of SAIs), being the standards that address organisational level requirements for audit quality. Care needs to be taken not to compromise the existing logical hierarchy of the ISSAI standards by designating, as standards, documents which may cut across the existing structure. With this in mind, it is important that the relationship of this document to the existing organisational level standards in the ISSAI framework be clearly explained. We observe that a model for placing this document may exist in the way ISSAI 11 Guidelines and Good Practices Related to SAI Independence relates to ISSAI 10 The Mexico Declaration on SAI Independence and ISSAI 21 Principles and Good Practices Related to Transparency and Accountability relates to ISSAI 20 Principles of Transparency and Accountability respectively.

support consideration of the framework as part of the ISSAI framework at level 1, once it has been refined and subject to meeting all the INTOSAI due process requirements in consultation with the INTOSAI Professional Standards Committee. The WGVBS through the project team has been working to execute the mandate entrusted to the WGVBS. The INTOSAI due process requirements have been followed and the PSC Chair has decided to propose inclusion at level 1 of the ISSAI framework. The final decision to include the document in the ISSAI framework rests with the INTOSAI community. The intention is that the proposed ISSAI be presented and considered by the INTOSAI members during the XXI

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Question 1: Are you of the opinion that all the key principles have been included in ISSAI X? If not, please explain by stating the key principles that have been omitted.

INTOSAI-Donor Secretariat and Stakeholder Relations INTOSAI Development Initiative (IDI)

We are of the view that all the key principles have been included.

Noted.

Canada We believe that all of the key principles are included and that, overall, the guidance is appropriate.

Noted.

ARABOSAI We believe that the key principles have been included in ISSAI X. However, 2 other principles can be added: - SAIs’ role in preventing and fighting corruption, - Cooperation between SAIs and citizens to enhance public accountability. Please refer to question three for detailed information about these two principles.

Noted. The project team has increased the emphasis on these two aspects but decided not to create new principles as explained in the project team’s detailed response under question three below, refer to



principles 2.3, 6.4 and 6.5.

State Audit Office of the Republic of Latvia

As requested within the Cover letter, please be informed, that in the opinion of the State Audit Office of the Republic of Latvia all key principles have been included within ISSAI X and really extensive and precise work has been done!

Noted.

State Audit Bureau-Qatar

Yes. Noted.

Nyenrode Business University, The Netherlands

I have developed this input in dialogue with my students of the Professional Program Public Sector Auditing at Nyenrode Business University in The Netherlands. Under objective 1 (strengthening the accountability…etc.), additional principles (or sub-principles) could be included to reflect the importance of the assessment by SAIs of internal control (including IT-controls) and internal audit.

The project team wanted to ensure that the ISSAI remains high-level, thus did not want to go into too much detail. The project team did include the following reference to internal control: Principle 9.3: “SAIs should have an appropriate organisational management and support structure that will give effect to good governance processes and support sound internal control and management practices.”

Malta Yes, agreed.

Noted.

Singapore We are of the view that all relevant key principles have been stated in ISSAI X.

Noted.

Sweden ISSAI X is based on the Framework for Communicating and Promoting the Value and Benefits of SAIs (henceforth referred to as the Framework), which was included in the discussion paper on the Value and Benefits of Supreme Audit Institutions, one of the two themes at the XX

th INCOSAI in South Africa in 2010.

From our point of view, the draft ISSAI X captures the essence of the principles and has met the requirements of further refinement, as stated in the Johannesburg Accords, to be considered for inclusion in the ISSAI framework. The transformation of the two objectives in the Framework in to the three objectives and twelve principles in ISSAI X clearly defines what SAIs have to do to in relation to the founding principles set out in the Lima

Noted.



Declaration. Furthermore, ISSAI X underlines the prerequisites of the ISSAIs on level 2 of the ISSAI framework. Acknowledging the high-level principles of ISSAI X, we are convinced that ISSAI X is more suitable for inclusion at level one of the ISSAI framework, for a more logical structure and in line with the ongoing process of harmonizing the ISSAI framework. ISSAI X would complement the Lima declaration and the remainder of the ISSAI framework.

Sweden Democracy and Accountability We find that the principles in ISSAI X cover the appropriate deliverables in promoting the value and benefits of SAIs towards the executive, the citizens and other stakeholders, including the public administration. However, a few perspectives have been adjusted in the preamble of ISSAI X compared with the preamble of the Framework. The changes refer mainly to the wording related to democracy, which is especially significant in an ISSAI emphasising the value and benefits of SAIs towards the citizens. In the Framework, the first point in the preamble connects democracy and accountability – key principles in democratic governance, especially when defining representative democracy as a learning process built upon fair, just and impartial information. SAIs’ audits can be regarded as a measurement of the outcome of democratic governance, providing impartial information for future deliberations and decisions. ISSAI X underlines SAIs’ unique dual role, by speaking truth to power and speaking truth to citizens for enhanced democratic governance. ISSAI X could even more clearly underline the relationship between SAIs, democracy, accountability and the citizens in the preamble of ISSAI X, in line with the Framework and the Johannesburg Accords.

Noted. The project team agreed that the principles of democracy and accountability deserve appropriate attention.

Iraq Yes, we agree that all the key principles have been included in the ISSAI X, and we would like to call your attention to the fact that the law of the BSA No. 31 of 2011 is inclusive of all the details of the principles set out in the draft.

Noted. The project team is pleased to learn that the ISSAI is consistent with BSA No. 31.

United Kingdom Yes – The NAO considers that the headline objectives and principles provide a clear, high-level framework for

Noted.



SAIs striving to make a difference to the lives of citizens.

Panama In our analysis, we consider that all key principles have been included in the ISSAI X.

Noted.

Lithuania Yes, we think that the 12 principles under the 3 objectives included in ISSAI X fully cover that area in question.

Noted.

France We acknowledge the important work done by the Working group on the Value and Benefits of SAIs and specifically the Auditor General of South Africa and the Controller and Auditor General of New Zealand. The three objectives about (1) strengthening the accountability, integrity and transparency of government and public entities, (2) demonstrating ongoing relevance to citizens and other stakeholders and (3) being model organisations through leading by example are indeed crucial and well-illustrated by the 12 principles of the value and benefits and their detailed provisions.

Noted.

France However, we should keep in mind that all these principles are permanently dependant on and sometimes endangered by the real economic and political context in which SAI work and strive towards best standards. In fact, we could even consider that the “virtuous circle” allowing the SAIs to better audit, then better inform the citizen, then better advise the government, then improve the citizen’s life, does not yet exist in most of the countries, even those having an ancient tradition regarding the control of public funds. The reasons for that relative failure lie in many socio-economic factors that SAIs do not directly master: for example, SAIs mainly play a role a posteriori for evaluating the consequences and results of a public policy. They can marginally influence some decisions by through previous targeted, dedicated audits or recommendations, but cannot prevent a priori debatable decisions from being made; even in developed countries, SAIs do not play a direct role in terms of regulation of the financial system, they have not been able to foresee or mitigate the financial crisis; they can only influence by general warnings the public debate. Furthermore, in some developing countries, SAIs remain hollow shells, created to satisfy the donors’ demands without having no

The project team has dealt with these suggestions under each of the three objectives as set out below.



or few capacities to really implement their official mandate. It may therefore be of use to recall the (political) conditions for a concrete implementation of the different principles that are enforced by this ISSAI as well as by the UN Resolution A/66/209. Proposal for the introduction of each of the 3 objectives Details of these proposals are included under the three objectives.

Kenya All the key principles for SAI operations are included in the draft

Noted.

Honduras We consider three objectives on strengthening accountability, integrity and transparency of government and public entities, ongoing relevance to the public and other interested parties and organizations be model through leading by example are really crucial and are perfectly illustrated by the 12 principles of value and benefits and its implementing rules.

Noted.

Brazil Answering question 1 of the cover letter, we believe that the key principles have been included in the ISSAI.

Noted.

Chile We believe that all principles are included in this ISSAI, we only need to emphasize certain aspects that are discussed in question two.

Noted.

Australia Yes. We agree that the document presents the key principles that describe the manner in which an SAI adds value to the lives of citizens.

Noted.

Switzerland Yes Noted.

Question 2: Do you consider that the guidance supporting each key principle is appropriate? If not, please explain why and provide additional suggestions.


We are of the opinion that the guidance is appropriate.

Noted.

Canada We believe that all of the key principles are included and that, overall, the guidance is appropriate.

Noted.

ARABOSAI We consider that the guidance supporting each key principle is quiet suitable. However, principle 12 needs some comments. In fact, we

We agree with the importance of capacity building and have amended principle 12



consider that capacity building can constitute a principle in itself without being combined with “promoting learning and knowledge sharing” as written in the draft. We can refer to IDI guide about “building capacity in SAIs” (2007) to put the guidance supporting this key principle as follows

1:

SAIs should

- systematically assess their current level of capacity, and their strengths and weaknesses;

- determine what additional capacity they seek to build, the resources it will need and the outcomes they expect to achieve;

- develop a strategy for delivery of this increased capacity, and related outcomes;

- implement this strategy; - evaluate the impact of the changes and the outcomes

achieved; and

- sustain the changes and develop a new strategy to build on what has been achieved.

accordingly. Principle 12: Capacity building through promoting learning and knowledge sharing Footnote 21 already refers the user of the ISSAI to “Building Capacity in Supreme Audit Institutions – A guide”.


Yes. Noted.

Malta Yes, agreed. However, NAO believes that the importance of adequate funding of SAIs is to be further highlighted in the ISSAI. This can be achieved by making slight amendments to two Articles to the ISSAI. Paragraph 8 of Principle 1 would be amended to read as follows: “SAIs should seek to maintain financial and managerial or administrative autonomy and have available appropriate human, material and financial resources.” In addition, paragraph 4 of Principle 11 would read as follows: “SAIs should ensure that they have sufficient and appropriate resources, including adequate funding, to perform their work in accordance with relevant standards and other requirements including having timely access to external and independent advice where necessary.” Moreover, NAO opines that more emphasis is to be

Comments have been dealt with under the specific principles and guidance.

1 IDI guide page 6.



placed on the importance of SAIs setting up and operating mechanisms to tackle financial impropriety, fraud and corruption. As a result, it is proposed that paragraph 3 of principle 5 should read: “SAIs should evaluate changing and emerging risks in the audit environment and respond to these in a timely manner.” After paragraph 6 of principle 5, an additional paragraph would then be added stating: “SAIs are to institute and implement appropriate mechanisms to tackle financial impropriety and mismanagement, fraud and corruption.” We feel that the Exposure draft is already of a very good quality. All amendments proposed are meant to perhaps slightly fine tune the Exposure Draft. We do not feel strongly about any of them. You may therefore feel free to incorporate or ignore any of these amendments. Comments dealt with under the specific principles.

Singapore We assess that overall, the guidance supporting the key principles is appropriate. For presentation purposes and completeness, we would like to propose changes to two of the provisions. Please refer to Table A for our suggested amendments. Suggested changes included in under principle 1 and 2.

Comments have been dealt with under principles 1 and 2 below.

Sweden SAIs operate under different jurisdictions, in different political and legislative traditions, and with different organisational models. We find that the principles in ISSAI X are appropriate as guidance for adaption and implementation in any environment in which SAIs operate. The principles accentuate the role of SAIs in relation to the executive, the citizens and stakeholders, and the public administration – all vital parts of a representative democracy. The principles are further clarified by references to other relevant ISSAIs for more detailed guidance. Hence, we find that ISSAI X provides a solid framework and provides appropriate guidance in promoting the value and benefits of SAIs.

Noted.

Iraq Yes, we believe that the guidance of each key principle is appropriate save what is mentioned in principle 1-7, SAIs should have relevant procedures for following up audit findings, as the scope of such procedures should include more than report composition and reporting and be

Comments have been dealt with under principle 1.7 below.



associated with accountability and ensuring that recommendations are carried out.

United Kingdom Yes – The NAO recognises that the guidance provides good support to SAIs in benchmarking or developing systems and procedures to promote the efficiency, accountability, effectiveness and transparency of public administration.

Noted.

Panama In general, we consider that the guide of support for every key principle is appropriate; however, we suggest the following modifications: See detail below. Suggested changes noted below under the principles and guidance.

Suggested changes have been dealt with below under the principles and guidance.

Lithuania Yes, we consider it is appropriate. Noted.

France We consider that the guidance supporting each key principle is appropriate for the chosen framework, as the ISSAI 2 must remain flexible as well as prescriptive. However, we should be attentive to the ultimate meaning of a few concepts that are never completely defined and described within the actual ISSAI. For example, “integrity”, “ethics”, “information”, even “independence” should be better defined so that they do not remain formal incantations and mantras without real content, agreed by everybody. Unless these notions are better defined, there is a risk any SAI could pretend acting upon them, without really intending to implement changes useful for the citizen’s life. We therefore propose that a glossary and possibly best practices be annexed to the draft to illustrate the possible application (and sometimes limitations or risks, for example when the “excess of information” or publication can possibly lead to a loss of influence on crucial topics) of these different concepts.

1. The project team considers it unnecessary to create another glossary.

2. The project team agreed that best practice could become a future project and is outside the scope of the current project.

Kenya The guidance supporting each key principle are appropriate and nearly exhaustive. However the drafters may consider the following additional proposals on the guidance: See detail under principles below.


Honduras We believe that the orientation of each key principle support is appropriate for the location chosen as the

Noted.



ISSAI X must be flexible and prescriptive.

Brazil Answering question 2 of the cover letter, we consider that the guidance under each key principle is appropriate.

Noted.

Chile We can highlight the importance of generate and gain the trust of society and citizens acting through a professional, objective, independent, transparent, providing security for effective management and efficient with respect to the control of the management and use of public resources, to be able to demonstrated ability to respond appropriately to changes in the environment in which they develop the audits and the trust including the expectations of citizens. This ISSAI focuses on a crucial aspect as the Value and Benefits of Supreme Audit Institutions that should generate, and which should make a difference in the lives of citizens, This can be reinforced with the view that has the SAI-PMF particularly in regard to results and impact generated by the performance of the SAI, and therefore the importance of the role of evaluations by the PMF on the building capacities of SAIs, that will generate the value and desired benefits. We understand that this is a statement of principles for the SAIs, which should be achieved. Because of this, we believe even more it is especially relevant to emphasize citizen participation (empowerment) and transparency (taking in account all the angles of this). We should reinforce that the SAI should be an example for the public sector. Finally, and attended the above, it been suggests to be more explicitly emphasize that SAIs should aspire to be an institution of excellence in a democratic society, to generate synergies and virtuous circles in the universe of public institutions with which they must interact. Therefore SAIs should looks through these trying to achieving and maintaining a stronger reputation, with an attitude that increases permanently institutional quality standards at the highest level. For the above we suggest the following changes in the wording of some of guidance of principles.




See detail in principles below.

Australia Yes. We agree that the guidance supporting each key principle is appropriate.

Noted.

Switzerland Yes Noted.

Question 3: Are there any other matters that you wish to raise?


No Noted.

ARABOSAI Fighting corruption and cooperation between SAIs and citizens are among topical issues in INTOSAI activities today, and can be important factors in making a difference in the lives of citizens. Suggestion 1: Add a principle dealing with SAIs’ role in preventing and fighting corruption We suggest that more importance can be given to SAIs’ role in fighting corruption. In ISSAI X’s Draft, it is written under principle 5, third point that “SAIs should evaluate changing and emerging risks in the audit environment and respond to these in a timely manner, for example, by promoting mechanisms to tackle financial impropriety, fraud and corruption”. “Corruption is the reason for lacking development and a structural obstacle to the development of nations”

2. And

INTOSAI is acting to promote a proactive role and international cooperation in reference to fight against corruption in a manner consistent especially through its “Working Group on the Fight against Corruption and Money Laundering”. According to us, a principle can be added as follow “Acting actively against fraud, corruption and misuse of public funds to participate in poverty reduction”. For that: - SAIs should take a leading responsibility for

The project team has increased the emphasis on preventing and fighting corruption but decided against creating a new principle. Principle 2.3 was included: “SAIs should respond appropriately, in accordance with their mandates, to the risks of financial impropriety, fraud and corruption.”

2 Report on the 20

th UN/INTOSAI Symposium on Government Audit, “INTOSAI: Active Partner in the international anti-corruption network, Ensuring transparency to promote social security and poverty

reduction”. Vienna 11 to 13 February 2009. Refer also to the Report on the 12th UN/INTOSAI Symposium on Government Audit, “The role of SAIs in fighting corruption and mismanagement”. Vienna 21 to

25 October 1996.



developing and implementing standards of good governance including transparency, full disclosure and accountability.

- SAIs should design a map of corruption risks within different government entities, as well as a corruption prevention plan. This should provide follow-up mechanisms for audit findings designed to enhance internal control systems, information systems and build capacity in audited bodies.

- SAIs should take responsibility to develop themselves and enhance their audit approach with a focus on contributing to preventing fraud and corruption.

- During audit missions, SAI auditors should routinely perform detailed risk analysis, including corruption risks analyses.

- SAIs should strive to ensure that their staffs have the professional competencies based on minimum levels of qualifications required to carry out missions to detect corrupted cases.

- SAIs should include, in the audit reports, recommendations to amend legislation with view to making their intervention in fighting corruption more efficient so that weaknesses that would increase corruption risk can be identified and addressed.

- SAIs should make use of their unrestricted rights of access to all the necessary information and of their broad mandates and full discretion in discharging their functions to contribute in unveiling corruption networks especially those involving public and private sectors.

- SAIs should report directly to their legislatures in order to avoid any influence from executive bodies.

- SAIs should submit their findings related to corruption to judicial power or any other responsible entity for punishing corrupted persons.

- SAIs should contribute specifically to the prevention of corruption in accordance with the United Nations Convention against Corruption.

- SAIs should strive to co-operate nationally and internationally with the broader parties involved in combating corruption.



Suggestion 2: Add a principle about effective practices of cooperation between SAIs and citizens to enhance public accountability

3

Cooperation between citizens and SAIs benefited all, since citizens and SAIs share the same objectives about increasing the efficiency of government, securing public governance, enhancing transparency, warranting accountability of the public sector and, ultimately, fostering development for all, contributing to the achievement of the Millennium Development Goals (MDGs)”. To reach this goal:

- SAIs should clearly communicate to the citizens what they do and what added value they generate for their states and societies in order to increase public knowledge about the accountability role played by SAIs.

- SAIs should develop and implement public relations for active and transparent communication, through on-going media coverage, public campaigns and other awareness-raising activities.

- SAIs should support budget transparency systems and actions that will inform citizens about the entire budget process, including amendments to and the execution of the budget.

- SAIs should promote citizen participation by developing mechanisms to receive and monitor complaints for noncompliance and misuse, as well as suggestions for improved public administration.

The project team included principle 6.4: “SAIs should interact appropriately with the media in order to facilitate communication with the citizens.” Principle 6.5 also covers this in a general way: “SAIs should engage with stakeholders, recognising their different roles, and consider their views, without compromising the SAI’s independence.”


No matters to report at present. Noted.


We feel that the subtitle ‘Making a difference to the lives of citizens’ does, as such, not sharply, deeply and powerfully reflect the exclusive and fundamental value and benefits of SAIs. The same expression could, for example, be legitimately used by any consultant. Therefore, we suggest to add some words taken from the key concepts in paragraphs 1 and 2 of the preamble – e.g. ‘…by upholding and promoting public accountability’ (like in paragraph 36 of the current/old ISSAI 100), or

Noted. Consideration was given to the suggestion but the project team decided to retain the wording in the ED. This matter was referred to the WGVBS for further consideration and it was agreed that the name should not be changed.

3 As described in the report on the 21

st UN/INTOSAI Symposium on Government Audit, Vienna 13 to 15 July 2011.



‘…by contributing to good public governance’ (or: ‘improved public sector administration’, like in the draft of the new ISSAI 100, par. 16), or…’by contributing to trust in society’; Suggestion: Title: The Value and Benefits of SAIs- making a difference to the lives of citizens by contributing to good public governance (= fundamental expectation);


We recognize an important difference between the nature of the first objective on the one hand, and the second and third objective on the other: the first objective is externally oriented, and reflects the essential function of SAIs in democratic societies. The second and third objective are, in our view, subordinated to and (necessary, insufficient) prerequisites for the fulfilment of this objective. We suggest to reflect this hierarchy in both the text and the model (Annexures A and B); Suggestion: Purpose (or: key objective): strengthening the accountability, integrity and transparency of government and public entities (principles 2, 3 and 4 being sub-objectives or just ‘objectives’);

Noted. Consideration was given to the suggestion and the project team reaffirmed that each of the objectives has equal importance; therefore they decided to retain the wording in the ED.


In our view, principle 1 is very important, but cannot directly be seen as an elaboration of the first objective. It is rather a prerequisite for the functioning of SAIs in general, or – in the context of this specific ISSAI and this specific objective, for strengthening the accountability, integrity and transparency of government and public entities. We suggest to change the status/position of this principle. Suggestion: Prerequisites: independence, ongoing relevance, being model organizations (and principles for every prerequisite).

Noted. Consideration was given to the suggestion but the project team decided to retain the wording in the ED. The issue of independence is fundamental for strengthening the accountability and transparency of public spending and therefore fits best under the heading that speaks most generally about this. Furthermore, it is more consistent with other INTOSAI material to mention independence as one of the first things in the document. Finally, independence is not



entirely within the control of the SAI itself, and is therefore not something on which the SAI can necessarily lead by example.

Singapore There are no other matters that we wish to raise. Noted.

Iraq Yes, we have some questions and remarks about certain items included in the draft standard. Suggestions were included below under the principles and guidance

Suggestions have been dealt with under the specific principles and guidance below.

United Kingdom a) The NAO believes strongly that a clear hierarchy should be maintained within the established ISSAI Framework, especially pertaining to Level 1 where due process is of paramount importance. We consider that Level 1 must be reserved for documents with a clear standards pedigree commensurate with the classification of fundamental (founding) principles that INTOSAI members “shall” or “must” adopt. Placing other documents at Level 1 could be seen as modifying that intention with the associated risk of diluting the status of legitimate Level 1 documents and adversely impacting the authority, coherence and credibility of the ISSAI framework in the eyes of stakeholders.

a) The Johannesburg Accords from the XX

th INCOSAI

record that the INTOSAI members support consideration of the framework as part of the ISSAI framework at level 1, once it has been refined and subject to meeting all the INTOSAI due process requirements in consultation with the INTOSAI Professional Standards Committee. The WGVBS through the project team has been working to execute the mandate entrusted to the WGVBS. The INTOSAI due process requirements have been followed and the PSC Chair has decided to propose inclusion at level 1 of the ISSAI framework. The final decision to include the document in the ISSAI framework rests with the INTOSAI community. The intention is that the proposed ISSAI be presented and considered by the INTOSAI



b) “Annexure” C evidence the completeness of the

output (draft ISSAI X) compared with the mandate given by INCOSAI (based on the 2010 Framework). This is helpful information for the ED process but not necessary or appropriate once the final document is adopted and stands in its own right. “Annexures” A and B add value by making the content, inter-relationship and structure of the document understandable at a glance.

members during the XXIst

INCOSAI, 2013, Beijing. b) The project team has deleted

Annexure C.

Panama No Noted.

Lithuania No matter to raise. Noted.

France We consider that the operational aspects of the ISSAI 2 are important and could be reinforced. In this regard, the footers are extremely useful. Paradoxically, the annexures B and C underline, with the triangle representation, that “all is in all”: a new SAI would not know from where to start as all angles are so interdependent. There is at the moment no obvious “lexical priority” (as John Rawls would have put it!) within the principles. However, in real life, there probably are other more practical ways of considering the prerequisites for guaranteeing SAIs added value and benefits. Even before safeguarding the accountability, demonstrating relevance or being model organisations to “change the life”, SAIs do have to define concretely who they work for (who the stakeholders are, how they relate to the Parliament, the Government and the public opinion), what they do (what functions they take upon themselves: compliance, performance and financial audits, but also and not mentioned in the actual ISSAI, potentially judgments and evaluations) and how they do it (with what guarantees in terms of statute, with what collegiality and contradictory principles, with what tools for sanctioning irregularities etc.). If we try and define more concretely these issues in other documents, be they the other ISSAIs, the general

The project team reaffirmed that the diagram is intended to show each of the objectives has equal importance. The WGVBS was made aware of the importance of alignment



INTOSAI Committees groups’ guidance on implementing the ISSAIs, the draft Performance measurement framework, the draft guidelines for Communicating and promoting the Value and Benefit and, primarily, the INTOSAI Draft Guidelines for Enhancing SAI’s effectiveness through cooperation with the Legislature, Judiciary and Executive, we have to avoid a possible gap between the general principles and the practical modalities. We keep back the possibility to provide further comments on these other documents and congratulate again the Working group for their awareness-raising of the Value and benefits of SAIs within the INTOSAI community

between this document and the other products being developed by the WGVBS during the WGVBS meeting in Peru. Noted.

Kenya We have no other comment. Noted.

Honduras Only point out the importance of avoiding a possible gap between the general principles and the practicalities of the SAI.

This document is intended to be aspirational. As set out in paragraph 6 of the Preamble, “SAIs are encouraged to apply them in a manner that is most appropriate for their respective environments.”

Brazil We think that the text is well written, straightforward and concise. Despite the fact that some principles were already included in other of level 2 standards, we believe that ISSAI X will contribute to summarize the main topics directly related to showing the value that the SAI(s) add to the Public Administration and to society.

Noted.

Chile We will not add any other matter that ones are exposed in question 2.

Noted.

Australia No. Noted.

Switzerland No. (“Yes” was indicated on the email but no other comments were provided, thus we are assuming that it should have been “No”.)

Noted.



Section Exposure draft ISSAI X

Comment received

from



the project group

General comments on the ISSAI name Mexico The SAIs’ work directly have an impact on the public administration performance and continuous improvement. Just after a positive and direct impact to democracy and accountability, SAIs could make a difference to the lives of citizens. Therefore, we consider that SAIs could only and indirectly contribute to make a difference to the lives of citizens. A proposed wording for the ISSAI X could be: “ISSAI X: The Value and Benefits of Supreme Audit Institutions – contributing to make a difference to the lives of citizens”.

The project team acknowledges the point made by the SAI that SAIs are not the only party contributing to making a difference to the lives of citizens. This matter was referred to the WGVBS for further consideration and it was agreed that the name should not be changed.

General comments on the preamble Sweden Emphasises that democracy, accountability and its relationship to the citizens deserves adequate attention in the preamble

Noted.

South Africa The definition of “democracy” differs from member state to member state. Is this defined in INTOSAI?

Noted. The project team is of the view that it is very difficult to define “democracy” in broad terms and therefore has chosen not to try and define it. This is the same approach that is followed in other INTOSAI documents including the Lima Declaration.

South Africa Are other terms used sufficiently universal? It is difficult to say if other terms used are sufficiently universal but the comments on the exposure draft should clarify this.

Peru Considering the components of the principles, and the efforts to be carried out by SAIs, in order to achieve their responsibilities; we suggest to emphasize, on the preamble of the ISSAI X that, the entire applications of such principles along with their components will be done gradually. SAIs should adequate their capacities and legal framework they perform until they are completely aligned with such

Noted. The project team is of the opinion that the requirements may be challenging. "...in a manner that is most appropriate...", already indicates that we acknowledge the need for time to implement these principles.




Comment received

from



the project group principles. “SAIs may establish principles and components which are in capacity of fulfill by communicating the goals achieved to citizens, and gradually incorporating, according to their capacities, principles and components needed to complete the total frame of principles.”

USA Generally, the exposure draft refers to “accountability, transparency, and integrity,” whereas the preamble reference is to “accountability, good governance, and integrity (see below). ISSAI 2 would be more effective if this variation in language is eliminated or clarified as appropriate.

Noted. The project team agreed to change the Preamble to align it with the body of the exposure draft using “accountability, transparency, and integrity,”

Pre

am

ble

1. Public sector auditing, as championed by the Supreme Audit Institutions (SAIs), is an important factor in making a difference in the lives of citizens. The auditing of government and public entities by SAIs has a positive impact on trust in society because it focuses the minds of the custodians of the public purse on how well they use public resources as they know that they can be scrutinised. Such awareness supports desirable values and underpins accountability mechanisms, which in turn leads to better decisions. Once the outcomes of the audits have been released, citizens are empowered to hold the custodians of the public purse accountable. In this way SAIs promote the efficiency, accountability, effectiveness and transparency of public administration.

4 An independent

and effective SAI is therefore an

Canada The second sentence of paragraph 1 of the preamble stipulates that: “The auditing of government and public entities by SAIs has a positive impact on trust in society because it focuses the minds of the custodians of the public purse on how well they use public resources as they know that they can be scrutinised”. The latter part of the sentence might suggest that public servants are inclined to be dishonest unless they know they will be audited. The sentence could end after the word “resources” and still carry the same message without potentially offending public servants.

In paragraphs 1 and 2 of the preamble, two different qualifiers for SAIs are used: paragraph 1: “…and independent and effective SAI” and paragraph 2 “…and independent and credible SAI”. You may wish to consider using the 3 qualifiers jointly in both places (e.g.,” … independent, effective and credible SAI...”) unless you were purposefully making a distinction.

Bullet 1: Project team agreed to remove “as they know that they can be scrutinised”. Bullet 2: Project team agreed to use “independent, effective and credible SAI”.

4 United Nations General Assembly Resolution A/66/209




Comment received

from



the project group essential component in a democratic system where accountability, good governance and integrity are an indispensable part of a stable democracy.

South Africa Reference to: “auditing of government and public entities” - Does this cover all types of audits, perhaps look at wording used in new ISSAIs - are public entities different from government, and what is meant by government, there are also other kinds of entities, may be just say public sector entities to be more inclusive.

Reference to : “public purse” - Be careful not to use English phrases that may be difficult to translate

“Such awareness supports desirable values and underpins accountability mechanisms, which in turn leads to improvedbetter decisions. Once the outcomes of the audits have been releasedmade public, citizens are empowered to hold the custodians of the public purse accountable.”

Reference to “democracy” - Many SAI is in countries which are not democracies.

Bullet 1: Project team agreed with using “public sector entities”. Bullet 2: Project team agreed to use “public resources” instead of “public purse”. Bullet 3: Project team agreed with the suggested amendments “improved” and “made public”. Bullet 4: Project team considers “democracy” to be aspirational and therefore prefers keeping the reference to “democracy”.

Hungary Line 6 in paragraph 1 and the wording of principle 4 include two similar phrases: ‘citizens are empowered’ and ‘empowerment of the public’, respectively. It would be more fortunate to find a solution with a different wording. In these two cases ‘enabling‘, ‘making it possible‘ is meant, and this might be confusing, misleading for those reading the standard. We recommend writing ‘citizens can hold the custodians of the public purse accountable’ in paragraph 1, and ‘facilitating the public to hold government and public entities accountable’ in

The project team agreed to replace “empowerment” with “... are able to hold the custodians of public resources accountable …”




Comment received

from



the project group principle 4.

Brazil Lastly, we just would like to propose a correction in the wording of the last sentence in the first paragraph: “(…) , good governance and integrity are an indispensable part of a stable democracy.” “ (…), good governance and integrity are indispensable parts of a stable democracy.”

The project team agreed to change the wording to: “accountability, transparency and integrity are indispensable parts”

USA An independent and effective SAI is therefore an essential component in a democratic system where accountability, good governance transparency and integrity are an indispensable part of a stable democracy.

The project team agreed to change the wording in the Preamble to be aligned with the rest of the document using “accountability, transparency and integrity”

European Court of Auditors

Public sector auditing, as championed by the Supreme Audit Institutions (SAIs), is an important factor in helps makeing a difference in to the lives of citizens. The auditing of government and public entities by SAIs has a positive impact on trust in society because knowing their actions may be scrutinisedit focuses the minds of the custodians of the public purse on how well they use public resources as they know that they can be scrutinised. Such awareness supports desirable values and underpins accountability mechanisms, which in turn leads to better decisions. Once the outcomes results of the audits have been released, citizens are empowered can use them to hold the custodians of the public purse to accountable. In this way, SAIs promote the efficiency, accountability, effectiveness and transparency of public administration. An independent and effective SAI is therefore an essential component in a democratic system, where and accountability, good governance and integrity are an indispensable part elements of a stable democracy.

First sentence: Agree with replacing “in” with “to” but prefer to keep “is an important factor in” given the aspirational nature of the document. Second sentence: The project team deleted “as they know that they can be scrutinised” based on other comments received. Third sentence: The project team changed the wording to read as follows: “Once SAIs’ audit results have been made public, citizens are able to hold the custodians of public resources accountable.” Fourth sentence: Noted. The project team has agreed to use the following wording: “An independent, effective and credible SAI is therefore an




Comment received

from



the project group essential component in a democratic system where accountability, transparency and integrity are indispensable parts of a stable democracy.”

Mexico “Public sector auditing, as championed by the Supreme Audit Institutions (SAIs), is an important factor in making contributing to make a difference in the lives of citizens.” “Once the outcomes of the audits have been released, citizens are empowered to hold the custodians of the public purse accountable. In this way SAIs promote the economy, efficiency, accountability, effectiveness, and transparency of public administration.”

Suggestion 1: This matter was referred to the WGVBS for further consideration and it was agreed that the name should not be changed. Suggestion 2: The wording used is directly quoted from the United Nations General Assembly Resolution A/66/209, therefore the wording was not changed.

2. In a democracy, structures are created and elected representatives are empowered to implement the will of the people and act on their behalf through legislative and executive bodies. A risk factor to consider when constructing democratic institutions is that power and resources can be mismanaged or misused, leading to an erosion of trust that can undermine the essence of the democratic system. It is therefore critical that the citizens of a country are able to hold their representatives accountable. Democratically elected representatives can only be held accountable if they, in turn, can hold accountable those who implement their decisions. As set out in the Lima Declaration

5 an important part of the

accountability cycle is an independent

Canada In paragraphs 1 and 2 of the preamble, two different qualifiers for SAIs are used: paragraph 1: “…and independent and effective SAI” and paragraph 2 “…and independent and credible SAI”. You may wish to consider using the 3 qualifiers jointly in both places (e.g.,” … independent, effective and credible SAI...”) unless you were purposefully making a distinction.

Project team agreed to use “independent, effective and credible SAI”.

5 ISSAI 1: Lima Declaration of guidelines on auditing precepts




Comment received

from



the project group and credible SAI to scrutinise the stewardship and use of public resources.

South Africa “A risk factor to be considered when constructing democratic institutions is that power and resources can be mismanaged or misused, leading to an erosion of trust that can undermine the essence of the democratic system.”

The project team agreed to make the suggested changes.

1. European Court of Auditors

“A risk factor to consider when constructing democratic institutions is that power and resources can be mismanaged or misused, leading to an erosion of trust that can and ultimately undermininge the essence of the democracytic system itself. It is therefore critical that the citizens of a country are able to hold their representatives to accountable.”

The project team made the following change: “A risk to be considered with public sector institutions in a democracy is that power and resources can be mismanaged or misused, leading to an erosion of trust that can undermine the essence of the democratic system. It is therefore critical that the citizens of a country are able to hold their representatives accountable.”

2. European Court of Auditors

“Democratically elected representatives can only be held to accountable if they, in turn, can hold to accountable those who implement their decisions.” Comment: This sentence is somewhat difficult to follow. Is it necessary?

Project team decided not to adopt this suggestion as it is not consistent with the wording used throughout the document.

3. Acting in the public interest places a further responsibility on SAIs to demonstrate their ongoing relevance to citizens and other stakeholders

6. SAIs

can show their relevance by appropriately responding to the challenges of citizens, the needs of different stakeholders, the emerging

State Audit Bureau of Kuwait

Paragraph (3) within the Introduction: The need to emphasize that SAIs should communicate with citizens and stakeholders without consideration of their political trends or parties so as not to affect SAIs independence and thus affect SAIs legitimacy. In this regard, the emphasis is on full compliance of SAIs with the Code of Ethics and hold members

Project team considered the comment but felt the overriding issue is independence. The importance of independence is stressed throughout the Preamble.

6 Stakeholders can be defined as a person, group, organisation, member or system that can affect or can be affected by the actions, objectives and policies of government and

public entities. Source: www.businessdictionary.com - adapted for the SAI environment.

http://www.businessdictionary.com/definition/person.html

http://www.businessdictionary.com/definition/group.html

http://www.businessdictionary.com/definition/action.html

http://www.businessdictionary.com/definition/objective.html




Comment received

from



the project group risks and changing environments in which audits are conducted. Furthermore, it is important that SAIs have a meaningful and effective dialogue with stakeholders about how the SAI’s work can support public sector improvement. This enables SAIs to be a credible source of independent and objective insight and guidance to support beneficial change in government and public entities.

accountable for non-compliance.

Denmark We suggest that more emphasis is put on the importance of parliament as the commissioning party and key stakeholder in the work performed by the SAIs and therefore propose the following changes: Page 4 – item 3, line 2. “... ongoing relevance to citizens, parliament and other stakeholders.”

The project team agreed to include the suggestion.

South Africa Reference to: “auditing of government and public entities” - Does this cover all types of audits, perhaps look at wording used in new ISSAIs - are public entities different from government, and what is meant by government, there are also other kinds of entities, may be just say public sector entities to be more inclusive.

“Furthermore, it is important that SAIs have a meaningful and effective dialogue with stakeholders about how the SAI’s work can support improvements in the public sector improvement.”

Suggestion 1: Project team has agreed to make use of “public sector entities”. Suggestion 2: Project team agreed to change the wording to: “Furthermore, it is important that SAIs have a meaningful and effective dialogue with stakeholders about how their work facilitates improvement in the public sector.”


“SAIs can show their relevance by appropriately responding to the challenges of citizens, the needs of different stakeholders, and the emerging risks and changing environments in which audits are conducted. Furthermore, it is important that SAIs have a meaningful and effective dialogue with

Project team agreed to make the following changes: “SAIs can show their relevance by appropriately responding to the challenges of citizens, the expectations of different




Comment received

from



the project group stakeholders about how their SAI’s work can support public sector promotes improvement in the public sector. This enables SAIs to be a credible source of independent and objective insight, and to give guidance to supporting beneficial change in government and public entities.”

stakeholders, and the emerging risks and changing environments in which audits are conducted. Furthermore, it is important that SAIs have a meaningful and effective dialogue with stakeholders about how their work facilitates improvement in the public sector. This enables SAIs to be a credible source of independent and objective insight, supporting beneficial change in the public sector.”

4. To be able to fulfil their functions and ensure their potential value to citizens, SAIs need to be seen as trustworthy. SAIs can only deserve trust if they themselves are objectively judged as being credible, competent and independent and can be held accountable for their operations. In order to make this possible they need to be a model institution by setting an example from which others in the public sector and the auditing profession at large can learn. With such a solid foundation in their own functioning, SAIs are better placed to strive for service excellence and quality while complying with a Code of Ethics and ensuring good governance.

South Africa “SAIs can only deserve trust if they themselves are objectively judged as being credible, competent and independent and can be held accountable for their operations. In order to make this possible they need to be a model institution by setting an example from which others in the public sector and the auditing profession at large can learn.”

Project team agreed to make the following changes: “SAIs only deserve trust if they themselves are objectively judged as being credible, competent and independent and can be held accountable for their operations. In order to make this possible, they need to be model institutions, setting an example from which others in the public sector and the auditing profession at large can learn.”

Hungary The first sentence of Paragraph 4 (‘SAIs need to be seen trustworthy‘) should be amended as follows: ‘SAIs need to be and be seen as trustworthy’.

The project team noted the suggested change but decided that the key issue is the perception and therefore did not make the suggested change. ISSAI 20: Principles of transparency and accountability




Comment received

from



the project group does expand further on this concept.


“SAIs can only deserve trust if they themselves are objectively judged as being credible, competent and independent and can be held to accountable for their operations. In order to make this possible they need to be a model institutions, by setting an example from which others in the public sector and the auditing profession at large can learn. With such a solid foundation in their own functioning, SAIs are better placed to should strive for service excellence and quality while complying with a Code of Ethics and ensuring good governance.”

The project team considered the suggestions and made the following changes: “SAIs only deserve trust if they themselves are objectively judged as being credible, competent and independent and can be held accountable for their operations. In order to make this possible, they need to be model institutions, setting an example from which others in the public sector and the auditing profession at large can learn.”

Mexico “To be able to fulfill their functions and ensure their potential value to citizens, SAIs need to be seen as trustworthy. SAIs can only deserve trust if they themselves are objectively judged as being credible, competent and independent and can be held accountable for their operations. In order to make this possible, they need to be a model institution by ...”

The project team agreed: 1. Fulfil is spelled correctly.

(UK English) 2. Comma added.

5. This standard is accordingly constructed around the emerging fundamental expectation of SAIs making a difference to the lives of citizens. The extent to which SAIs are able to make a difference to the lives of citizens depends on SAIs: 5.1 Strengthening the accountability,

integrity and transparency of government and public entities;

5.2 Demonstrating ongoing relevance to citizens and other

Denmark We suggest that more emphasis is put on the importance of parliament as the commissioning party and key stakeholder in the work performed by the SAIs and therefore propose the following changes: Page 5 – item 5.2. “Demonstrating on-going relevance to citizens, parliament and other stakeholders.”

The project team agreed to make the suggested change.




Comment received

from



the project group stakeholders; and

5.3 Being model organisations through leading by example.

This fundamental expectation and the three objectives which have been used to categorise the 12 principles of the value and benefits of SAIs and their detailed provisions are linked to the International Standards of Supreme Audit Institutions (ISSAIs) that are situated at level 2 of the ISSAI framework.

South Africa “The extent to which a SAIs isare able to make a difference to the lives of citizens depends on the SAIs:”


Iraq Item 5 – We recommend adding a new item to the topic to 5.4 (“which has the capability to evaluate the performance of entities and contribute the amendment of the laws of certain entities that are concerned with the lives of citizens”)

The project team agreed that the current objectives as captured in paragraphs 5.1. - 5.3 of the Preamble are sufficient and provide the structure under which the 12 principles sit. The principles under objective 1, Strengthening the accountability, integrity and transparency of government and public entities, cover the suggestion of SAIs evaluating the performance of public entities which leads to appropriate action being taken, that would include the amendment of laws, if appropriate.


“This standard is accordingly constructed around the emerging fundamental expectation of SAIs making a difference to the lives of citizens. The extent to which SAIs are able to make a difference to the lives of citizens depends on themSAIs:

The project team considered the suggestions but agreed to change the wording in accordance with the suggestions received from




Comment received

from



the project group 5.1 Helping Sstrengthening the accountability,

integrity and transparency of government and public entities;

5.2 Demonstrating ongoing relevance of SAIs’ work to citizens and other stakeholders; and

5.3 Being model organisations through leading by example.

This fundamental expectation and together with the three objectives which have been used to categorise the 12 principles of the value and benefits of SAIs. and tTheir detailed provisions are linked to the International Standards of Supreme Audit Institutions (ISSAIs) that are situated at level 2 of the ISSAI framework.”

other SAIs. The project team agreed to remove the entire paragraph because it was found unnecessary.

Mexico “This standard is accordingly constructed around the emerging fundamental expectation of SAIs making contributing to make a difference to the lives of citizens. The extent to which SAIs are able to make a difference positively impact to the lives of citizens depends on SAIs: 5.2 Demonstrating ongoing relevance of supreme

auditing to citizens and other stakeholders; and This fundamental expectation and the three objectives which have been used to categorise the 12 principles of the value and benefits of SAIs and their detailed provisions are linked to the International Standards of Supreme Audit Institutions (ISSAIs) that are situated at level 2 of the ISSAI framework

7.”

This matter was referred to the WGVBS for further consideration and it was agreed that the name should not be changed. The suggestion relating to paragraph 5.2 was considered but the term suggested was inconsistent with the rest of the document. The project team agreed to remove the entire paragraph because it was found unnecessary.

6. SAIs operate under different mandates and models. However, these objectives and principles are intended

Denmark Page 5 – item 6: We appreciate and agree that the objectives and principles of ISSAI X set a standard to strive towards. For some SAIs this standard will

The project team considered the suggestion and made the following changes:

7 Further information can be found at www.issai.org




Comment received

from



the project group to set a standard to strive towards and enable all SAIs to communicate and promote the value and benefits that they can bring to democracy and accountability in the respective jurisdictions. The principles apply equally to SAI staff and those who work on behalf of the SAIs

8. The

detailed provisions for the application of the principles included herein, serve as best practice for an independent SAI and SAIs are thus encouraged to apply them and assess their compliance with such provisions in a manner that is most appropriate for their respective environments.

be extremely difficult to achieve and we are a little concerned that – due to the different environments of SAIs – some SAIs may be further discouraged by the highlighting of the provisions for the application of the principles being referred to as best practice for independent SAIs. We therefore propose the following minor adjustment: The sentence beginning: “The principles apply equally to SAI staff and those who work on behalf of the SAIs” should continue: “and SAIs are thus encouraged to apply them and assess their compliance with such provisions in a manner that is most appropriate for their respective environments”. This means that the sentence: “The detailed provisions for the application of the principles included herein, serve as best practice for an independent SAI” could be deleted.

“The principles apply equally to SAI staff and those who undertake work on behalf of the

SAIs9. SAIs are encouraged to

apply them and assess their compliance with such provisions in a manner that is most appropriate for their respective environments.”

South Africa “SAIs operate under different mandates and models. However, these objectives and principles are intended to set a standard to strive towards and to enable all SAIs to communicate and promote the value and benefits that they can contributebring to democracy and accountability in their respective jurisdictions. The principles apply equally to SAI staffpersonnel and those who undertake work on behalf of the SAIs.”

The project team made the following changes: “SAIs operate under different mandates and models. However, these objectives and principles are intended for SAIs to strive towards and to enable all SAIs to communicate and promote the value and benefits that they can bring to democracy and accountability in their respective jurisdictions. The principles apply equally to SAI staff and those who undertake work on behalf of the SAIs.”

7. Mexico “… The detailed provisions for the application of the principles included herein, serve as best practice for

The project team made changes to the paragraph

8 Further guidance can be found in ISSAI 20, principle 5.

9 Further guidance can be found in ISSAI 20, principle 5.




Comment received

from



the project group an independent SAI, and SAIs are …” based on other comments

received, which makes the suggestion no longer relevant.




Comment received

from



the project group STRENGTHENING THE

ACCOUNTABILITY, INTEGRITY AND TRANSPARENCY OF GOVERNMENT AND PUBLIC ENTITIES To ensure that elected officials act in the best interests of the citizens they represent, governments and public entities need to be properly accountable for their stewardship over, and use of, public resources. SAIs strengthen accountability, integrity and transparency by auditing public sector operations and reporting on their findings, whilst safeguarding their independence. These reports enable those charged with governance to discharge their responsibilities and thus complete the cycle of accountability.

Canada In the second sentence of the opening comments for the first objective, we would suggest replacing the word “strengthen” by “play a key role in the…”. We believe that SAIs, in fulfilling their mandate in a public manner, help to promote accountability, integrity and transparency but do not directly strengthen these.

The project team agreed to keep the current wording, consistent with the aspirational nature of the ISSAI.


Under objective 1 (strengthening the accountability…etc.), additional principles (or sub-principles) could be included to reflect the importance of the assessment by SAIs of internal control (including IT-controls) and internal audit.

The project team agreed that the suggestion would be too detailed and the assessment of internal controls (including IT controls) and internal audit is covered in the audit process when using professional auditing standards.

South Africa Reference to: “government and public entities” - Does this cover all types of audits, perhaps look at wording used in new ISSAIs - are public entities different from government, and what is meant by government, there are also other kinds of entities, may be just say public sector entities to be more inclusive.

“To ensure that elected officials act in the best interests of the citizens they represent, governments and public entities need to be properly accountable for their stewardship over,

Bullet 1: The project team agreed with the use of “public sector entities”. Bullet 2: The project team agreed with removing “properly”. The sentence reads as follows:




Comment received

from



the project group and use of, public resources.”

“These reports enable those charged with governance to discharge their responsibilities and thus complete the cycle of accountability.” - Not sure about this sentence, can a report enable someone to do their job, and does it really complete the cycle of accountability? The report provides information on areas that require attention, what they do about it demonstrates their accountability in this regard.

“To ensure that elected officials act in the best interests of the citizens they represent, governments and public sector entities need to be accountable for their stewardship over, and use of, public resources.” Bullet 3: The project team agreed to change the wording as follows: “This enables those charged with public sector governance to discharge their responsibilities, in responding to audit findings and recommendations and taking appropriate corrective action, and thus complete the cycle of accountability.”

France p.6, after “SAIs strengthen accountability, integrity and transparency by auditing public sector operations and reporting on their findings, whilst safeguarding their independence”, we could insist and add that “SAIs therefore need to build and maintain their institutional position, with the help of the legislative, executive and judicial powers, so that the statute and independence of the entity (be it an Audit office, a Court of Accounts, a Board or any other SAI) and of its staff (be they magistrates, counselors or auditors) is guaranteed by the rule of law”.

The project team agreed that the suggestion was already covered in principle 1.1.


HELPING STRENGTHENING THE ACCOUNTABILITY, INTEGRITY AND TRANSPARENCY OF GOVERNMENT AND PUBLIC ENTITIES

The project team considered the suggestions but agreed to change the wording in accordance with the suggestions received from other SAIs. “strengthening the accountability, integrity and transparency of government




Comment received

from



the project group “To ensure that elected officials act in the best interests of the citizens they represent, governments and public entities need to be properly accountable for their stewardship over, and use of, public resources. SAIs strengthen accountability, integrity and transparency by independently auditing public sector operations and reporting on their findings, whilst safeguarding their independence. These reports enable those charged with governance or its oversight to discharge their responsibilities and thus make an important contribution to complete the cycle of accountability.”

and public sector entities” The project team considered the suggestions and made the following changes which include suggestions from other SAIs: “SAIs strengthen accountability, transparency and integrity by independently auditing public sector operations and reporting on their findings. This enables those charged with public sector governance to discharge their responsibilities, in responding to audit findings and recommendations and taking appropriate corrective action, and thus complete the cycle of accountability.”



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General comments on Principle 1 State Audit Bureau of Kuwait

Item of accountability, integrity and transparency of the government and public entities: Principle (1): The need to emphasize on non-political affiliation for all SAIs members especially leadership bodies, in order to maintain SAIs independence

The project team agreed that the suggestion is already covered in principles 1.1 and 1.2.

Denmark The excellent list of actions required to safeguard the independence of SAIs could perhaps be supplemented with a clause on the overriding importance of preserving the auditor integrity and ensuring that neither SAI heads nor members (of collegial institutions) are involved in the administration of matters that may later be subjected to audit by the SAI.

The project team agreed that it is already covered by principle 10.1.

Kenya The guidance on this principal covers nine critical issues. However, other than risks faced by SAIs due to legal and organizational deficiencies, there are also risks to independence that the SAI may bring upon itself through its own conduct or the conduct of its staff. Therefore the draft could include guidance on the need for the SAIs to conduct their affairs in a manner that assert their independence from political or other parochial interests: SAIs should plan their work to serve the national good but not parochial interests of sections of the society in which they operate.

The project team agreed that it is already covered by principles 10.1 – 10.3.

1. SAIs should strive to secure and maintain an appropriate and effective constitutional, statutory or legal framework for themselves.

South Africa “SAIs should strive to secure and maintain an appropriate and effective constitutional, statutory or legal framework for themselves.”


Mexico “SAIs should strive to promote, secure and maintain an appropriate and effective constitutional, statutory or legal framework for themselves.” Comment on the word “secure”: The first endeavor is to promote the appropriate and effective constitutional, statutory, or legal framework. This is applicable to both SAIs having and lacking this

The project team agreed to make the suggested change. The project team used the word “strive” to acknowledge the efforts of SAIs to secure their independence depending on


Comment received

from



the project group



framework, since the promotion of its relevance should be permanent (considering, for example, the institutional reforms, changes in the relevant commission responsible for overseeing the SAI, etc.)

On the other hand, do SAIs are empowered or capable to “secure” this framework? This is up to the legislative members, so the SAIs’ scope in this regard could be limited.

the legislature in each jurisdiction.

2. SAIs should seek to safeguard the independence of SAI heads and members (of collegial institutions), including security of tenure and legal immunity in the normal discharge of their duties.

Iraq Supreme Audit Institutions should seek to safeguard the independence of the SAI heads. We would like to make it clear, in this concern, that independence of heads of SAIs should be ensured by the applicable laws and constitutions. We suggest adding the following sentence at the end of the paragraph (via legal clear-cut legislation)

The project team agreed that this suggestion is already covered in principle 1.2.

USA … legal immunity within the context of appropriate legal and ethical framework in the normal discharge of their duties.

The project team agreed to make the following change: “SAIs should seek to safeguard the independence of SAI heads and members (of collegial institutions), including security of tenure and legal immunity in accordance with applicable legislation, which results from the normal discharge of their duties.”

3. SAIs should make use of their broad mandates and full discretion in discharging their functions and responsibilities to improve the stewardship of public funds.

South Africa “SAIs should make use of their broad mandates and full discretion in discharging their functions and responsibilities to improve the stewardship of public funds.”

The project team agreed with the suggestions.

Iraq Changing the phrase (improving stewardship) into (improving control).

The project team considered the suggested change but agreed that “stewardship” is a more appropriate term.


Is the guidance directly linked to independence? We suggest moving this to principle 2 as number 1.

The project team considered the suggestion and agreed that it could fit under principle 2 but because the principle is contained in ISSAI 10 it was decided not to move it to



principle 2.

4. SAIs should have unrestricted rights of access to all the necessary information, in a timely manner, for the proper discharge of their statutory responsibilities.

South Africa “SAIs should have unrestricted rights of timely access to all the necessary information, in a timely manner, for the proper discharge of their statutory responsibilities.”

The project team agreed to remove “in a timely manner” but decided not to include “timely” as it is covered by “unrestricted rights”. The wording reads as follows: “SAIs should have unrestricted rights of access to all necessary information for the proper discharge of their statutory responsibilities.”

USA SAIs should havereport compliance with audit standards only if the SAI has unrestricted rights of access to all the necessary information, in a timely manner, for the proper discharge of their statutory responsibilities if issuing an unmodified opinion.

The project team considered the suggestion but found it too specific.


... to all the necessary information, ... The project team agreed to make the suggested change.

5. SAIs should use their rights and obligations to report independently on their work.

6. SAIs should decide on the content of their reports.

Singapore We recommend that the exposure draft retain the original wording of the guiding principle presented in the Discussion Paper – SAIs should have the “the freedom to decide on the content and timing of audit reports and to publish and disseminate them.” This is to be in line with ISSAI 10: Mexico Declaration of SAI Independence

10. In order for a

SAI to discharge its duties independently and effectively, possessing the autonomy to publish the audit reports in a timely manner and being able to choose the appropriate tools of dissemination are as critical as having the freedom to decide the content of audit reports.

The project team agreed to make the following change to principle 1.6: “SAIs should have the freedom to decide on the content and timing of their reports.” The publishing and dissemination of the reports are covered under principle 4.2.

7. SAIs should have relevant procedures for following up audit findings.

State Audit Office of the

Principle 1 p.7 – SAIs should have relevant procedures for following up audit findings.

The project team agreed to make the following change,

10

Principle 6 of the Mexico Declaration of SAI Independence stipulates that SAIs should have “the freedom to decide on the content and timing of audit reports and to publish and disseminate them.” It

further elaborates that SAIs should be free to decide on the timing of their audit reports except where specific reporting requirements are prescribed by law, and should be free to publish and disseminate their reports, once they have been formally tabled or delivered to the appropriate authority—as required by law.



Republic of Latvia

Please specify what is meant by „audit findings”. Maybe “audit recommendations” would be more appropriate here?

also in the light of other comments received: “SAIs should have appropriate mechanisms for following up audit findings and recommendations.”

Chile The 4 proposals from the Chile SAI´s, that meant to reinforce the idea of involve the citizenship and the transparency in the work of the SAI. Proposal 1: 7. SAIs should use their rights and obligations for following up audit findings with relevant procedures in place.

The project team considered the suggestion but found it too specific. Based on comments received from other SAIs the wording was changed to: “SAIs should have appropriate mechanisms for following up audit findings and recommendations.”

Malta Paragraph 7 of principle 1 should be replaced by “SAIs should establish appropriate follow-up mechanisms for following up audit findings and recommendations.”

The project team agreed to make the following change: “SAIs should have appropriate mechanisms for following up audit findings and recommendations.”

Iraq Save what is mentioned in principle 1-7, SAIs should have relevant procedures for following up audit findings, as the scope of such procedures should include more than report composition and reporting and be associated with accountability and ensuring that recommendations are carried out.

The project team agreed that this suggestion is too specific. The wording was changed based on comments received from other SAIs: “SAIs should have appropriate mechanisms for following up audit findings and recommendations.”

Mexico “SAIs should have relevant procedures for planning, sampling, and conducting their audit work, as well as for following up audit findings.” Additional comments: If within principle 1 specific references are made with regard to the audit report (par #5) and the corresponding following-up (par #7), then we suggest completing the process by making explicit reference to the planning and execution phases. Furthermore, we would like to mention that paragraph 8 is clear when making reference to the

The project team agreed that this suggestion is too specific. The wording was changed based on comments received from other SAIs: “SAIs should have appropriate mechanisms for following up audit findings and recommendations.”



“financial and managerial or administrative autonomy”. Then, paragraph 7 could be dedicated to refer to the desired technical autonomy (with due respect to the national legal provisions), in order to guarantee the objectivity and reliability of their audit work). The technical autonomy would be relevant, e.g. for SAIs to decide on the use the ISSAI Framework -if the corresponding national regulation allow them to do so-, as reference when conducting audits and other types of work. Ideally, SAIs should be able to set the adequate methodology for planning, sampling, conducting and following up their audit work (which is somehow referred in paragraph 3 of Principle 8)

8. SAIs should seek to maintain financial and managerial or administrative autonomy and appropriate human, material and financial resources.

Malta Paragraph 8 of Principle 1 would be amended to read as follows: “SAIs should seek to maintain financial and managerial or administrative autonomy and have available appropriate human, material and financial resources.”

The project team considered the suggestion but found that the current wording conveys the same message.

USA SAIs should seek to maintain financial and managerial …

The project team decided that “seek to maintain” is appropriate, as it is not always within the control of the SAI to “maintain financial... autonomy.”

Mexico Comment on “financial”: From our experience in Mexico, technical and management autonomy could be possible, but how SAIs could promote and maintain the financial one. How could this type of autonomy could be possible since SAIs –as it is the Mexican case- could be a technical entity reporting to the Legislative branch, which approves the required financial resources? This comment is based on the following premise: SAI’s decision on the budget allocation is included as part of the management autonomy; financial autonomy is considered the SAI’s faculty to determine its own budget.

The project team agrees with the comment but the inclusion of the words “seek to” reflects the fact that the SAI does not necessarily control the level of resources.

9. SAIs should report on any matters that Chile The 4 proposal from the Chile SAI´s, that meant to The project team considered



may affect their ability to perform their work in accordance with their mandates and/or the legislative framework.

reinforce the idea of involve the citizenship and the transparency in the work of the SAI. Proposal 2: 9. SAIs should report on any matters that may affect their ability to perform their work in accordance with their mandates and/or the legislative framework, foremost to the citizenship as an act of transparency.

the suggestion but found that the current wording is appropriate in the context of the other guidance supporting principle 1.



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General comments on Principle 2 State Audit Bureau of Kuwait

Principle (2): The need to include certain audit types, such as environmental audit and sustainable development support, due to their importance in maintaining the States resources.

The project team considered the suggestion but found it too specific. Principle 2.2 already refers to “other types of work”, which covers “environmental audit and sustainable development support reporting”.

Denmark Principle 2 This principle refers very specifically to the three branches of audit that are very elaborately described in the new ISSAIs on level 3. We suggest that the reference is made to the relevant new ISSAIs on level 3 of the framework.

The project team agreed with the suggestion and added references to ISSAIs 200, 300 and 400.

Peru On the other hand, we recommend including in principle 2, the necessity to promote the implementation and strengthening of appropriate mechanisms of “internal control” within the public entities. “SAIs must promote implementation of appropriate mechanisms of “internal control” by public entities”.

The project team considered the suggestion but found it too specific. It is also covered by principle 2.1, specifically the need to comply with “applicable professional standards”.

Kenya Again the guidance is good. However , we think it could also include an assertion on the need for the SAI to have a detailed and global understanding of Government including its strategies , managerial and operational strengths and weaknesses as a prerequisite to the SAI’s understanding of its own role as a watchdog for public sector accountability . For that matter the guidance could assert that: i. The SAI should study the strategies, policies and

plans of the government in detail in order to inform its basis for setting audit priorities:

ii. The SAI should have an insightful understanding of its stakeholders especially their needs and on public financial management and their expectations on its own work and should seek to respond to these in the best way and most cost-effective manner possible

The project team considered the suggestion but found it too specific. Principles 5.4 and 5.5 cover these suggestions.


Comment received

from



the project group




PRINCIPLE 2: Carrying out audits and other types of work to ensure that help hold government and public entities are held to accountable for their stewardship over, and use of, public resources

The project team considered the suggestion and made the following change in the light of other comments received: “Carrying out audits to ensure that government and public sector entities are held accountable for their stewardship over, and use of, public resources”

1. SAIs should, in accordance with their mandates and applicable professional standards, conduct any or all of the following: a. Audits of financial and, where

relevant, non-financial information b. Audits of compliance with

legislation and regulations c. Performance audits

Compliance Audit Subcommittee (CAS)

CAS would like to make a minor comment on the paragraph 1.b under principle 2, where Compliance Audit is mentioned. The paragraph at present reads:

“Audits of compliance with legislation and regulations”

In the finalization of the ISSAI 400 draft the decision was made that Compliance Audit should encompass both the principle of regularity and the principle of propriety, both covered under the term “authorities”. Hence the paragraph 1.b under principle 2, page 6 in the ISSAI on the Value and Benefits of SAIs should read as follows:

“Audits of compliance with applicable authorities (laws, regulations and principles of sound public sector financial management and conduct of public sector officials)”

The project team agreed with the suggested change. Wording changed to read as follows: “Audits of compliance with the applicable authority (with a footnote to explain that “Applicable authority” refers to laws, regulations and principles of sound public sector financial management and conduct of public sector officials)”

Iraq Item 1a. – it includes the phrase – audits of financial and where relevant (non-financial) information. The sentence is not clear. We think you mean administrative audit.

The project team decided that the term “non-financial information” should be included. It refers to other types of information that are not covered by financial audits, for example the audit of performance (service) reports.

Panama Principle 2: Page 6 first line "a. Audits of financials and, where relevant, non-financial information." We suggest that the paragraph be corrected, as it may seem confusing, which may be due to the translation.

(Note of translator: The comment is not applicable as it refers to a misunderstanding on the translation of the ISSAI.)



2. SAIs may also, in accordance with their mandates, perform other types of work, for example judicial review or investigation into matters where public funds are being used or the public interest is at stake.

11

Lesotho The use of the word "MAY"; for example in Principle 2 (2) - this sounds optional and it means the SAI is not complying with this standard if this has not been in practice. Suggestion: The word may be replaced with SHOULD

The project team takes note of the comment but since SAIs have different mandates it will be necessary to keep “may”.

Malta Paragraph 2 of principle 2 is to include public sector IT audits as other work that can be performed by a Supreme Audit Institution. Thus the paragraph may be reworded: “SAIs may also, in accordance with their mandates, perform other types of work, for example judicial review or investigation into matters where public funds are being used or the public interest is at stake such as special audits and investigations or IT Audits.”

The project team considered the suggestion but found it too specific. Principle 2.2 already refers to “other types of work”, which covers IT audits.

South Africa “SAIs may also, in accordance with their mandates, perform other types of work, for example judicial review or investigation into matters where public funds are being used or where the public interest is at stake.”

The project team agreed with the suggested change. The wording was changed as follows: “SAIs may also, in accordance with their mandates, perform other types of work, for example judicial review or investigation into the use of public resources or matters where the public interest is at stake.”

Iraq Item 2 – modifying it by adding the word (misused) so that it is read as (where public funds are misused)

The project team agreed to make the following change: “SAIs may also, in accordance with their mandates, perform other types of work, for example judicial review or investigation into the use of public resources or matters where the public interest is at stake.”

Peru In general, the document focuses on the post control SAIs actions; however, numeral 2 of principle 2 refers to “other types of work”, where preventive control may also be included. In the Lima Declaration such control is known as “prior control”,

The project team considered the suggestion but found it too specific. The assessment of internal controls (preventative controls) is covered in the audit

11

Further guidance can be found in ISSAI 10, principles 3 and 6.



which implies the capacity of define and avoid damage towards the State before it happens. “SAIs may also, in accordance with their mandates, carry out preventive controls, which are meant to avoid irregularities”.

process when using professional auditing standards.

3. SAIs should submit audit reports, in accordance with their mandates, to the legislature or any other responsible public body, as appropriate.

Chile The 4 proposal from the Chile SAI´s, that meant to reinforce the idea of involve the citizenship and the transparency in the work of the SAI. Proposal 3: 3. SAIs should submit audit reports, in accordance with their mandates, to the legislature or any other responsible public body, as appropriate, including to the citizenship as an act of transparency.

The project team decided that the suggestion is already covered by principles 4.2 and 6.3.


This guidance is directly linked with reporting on audit results. We suggest moving this to principle 4 as number 2.

The project team decided that the guidance should remain under principle 2. Submitting the report to the legislature or the responsible public body is part of the audit cycle – auditing and then reporting to the legislature.

4. SAIs should analyse their individual audit reports to identify themes, common findings, trends, root causes and audit recommendations, and discuss these with key stakeholders.

Singapore The emphasis of this principle is on the carrying out of audits, whereas the analysis and discussion of common trends and findings takes place after the carrying out of individual audits. Thus, we propose to categorise this provision under the principle “Enabling those charged with public sector governance to discharge their responsibilities in responding to audit findings and taking appropriate corrective action”. The discussion on common themes and findings with relevant public sector authorities would help them identify critical areas to respond to the findings and take corrective action, improving public sector governance as a whole.

The project team agreed to make the suggested change by moving the guidance to principle 3.3.

Iraq Item 4 – adding the phrase (within a defined period of time) at the end of the sentence.

The project team decided that it is not necessary to include the suggestion. Each SAI should determine the timing of these reports in accordance with their mandate.



Hungary Provision 4 of Principle 2: It might be reasonable to place this sentence under Principle 3 as the last provision thereof.

The project team agreed to move the guidance to principle 3.3.



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General comments on Principle 3 Nyenrode Business University, The Netherlands

Principle 3: since the relations of SAIs with the legislature and its committees on the one hand, and with auditees’ management and governing boards on the other, are fundamentally different, the principle of ‘enabling…’ could better be dealt with separately for these parties. We suggest to include one principle for enabling the legislature and its committees, and another principle for enabling the auditees’ management and governing boards. This also reflects the different responsibilities of these parties – these should not be mixed up;

The project team decided to keep the current wording. It is not necessary to distinguish between the different types of stakeholders. Furthermore, stakeholder is defined in paragraph 3 of the Preamble.

South Africa On principle nr 3 – It is recommended that we include a bullet on root cause analysis – if properly done this enables those charged with governance to do what is required to address the underlying cause of the challenge

The project team agrees with the suggestion. Principle 2.4 was moved to principle 3.3, thus addressing the root cause analysis issue raised.

Mexico “PRINCIPLE 3: Enabling those charged with public sector governance to discharge their responsibilities in responding to audit findings and recommendations and taking appropriate preventive and corrective action”

The project team considered the suggestion but prefers the current wording. Corrective action relates to the findings reported as well as “preventive actions”. The corrective actions will by nature be preventive.

1. SAIs should provide the legislature, its committees, or auditees’ management and governing boards with relevant, objective and timely information.

South Africa Timely information – What types of information are referred to here.

The project team decided that the wording should remain general. SAIs share other information with stakeholders, which goes beyond audit findings and audit recommendations.

Mexico “SAIs should provide the legislature, its committees, or auditees’ internal control bodies, management and governing boards with relevant, objective and timely information.”

The project team considered the suggestion but found it too specific. Information given to management and governing board should be sufficient – it is those bodies that are responsible, hence they should be held accountable. From a general perspective, internal


Comment received

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the project group



control bodies are included in “auditees”.

2. SAIs should, without compromising their independence, provide advice on how their audit findings and opinions might be used to the greatest effect, for example through the provision of good practice guidance.

3. SAIs should develop professional relationships with relevant legislative oversight committees and auditees’ management and governing boards to help them better understand the audit reports and conclusions and take appropriate action.

South Africa Principle 3, point 3: Also include “without compromising their independence.”

The project team considered the suggestion but decided that the wording would not be changed as the words “professional relationships” already suggest that “independence” should not be compromised.

4. SAIs should report, as appropriate, on the follow-up measures taken with respect to their recommendations.

Chile The 4 proposal from the Chile SAI´s, that meant to reinforce the idea of involve the citizenship and the transparency in the work of the SAI. Proposal 4: 4. SAIs should report, always except when the mandate said that is reserved, on the follow-up measures taken with respect to their recommendations.

The project team decided that the wording would not be changed as the words “as appropriate” do cover the suggested change.

Panama Principle 3: number 4, “SAIs should report, as appropriate, on the follow-up measures taken with respect to their recommendations”, we suggest adding: based on rules, regulations and policies established.

The project team decided that the wording would not be changed as the words “as appropriate” do cover the suggested change.



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General comments on Principle 4 Iraq Principle 4 - We suggest that it should be placed before principle 3.

The project team decided not to change the order of the principles. Principle 4 relates to reporting to citizens and this should follow after reporting to those charged with governance.

Hungary Line 6 in paragraph 1 and the wording of principle 4 include two similar phrases: ‘citizens are empowered’ and ‘empowerment of the public’, respectively. It would be more fortunate to find a solution with a different wording. In these two cases ‘enabling‘, ‘making it possible‘ is meant, and this might be confusing, misleading for those reading the standard. We recommend writing ‘citizens can hold the custodians of the public purse accountable’ in paragraph 1, and ‘facilitating the public to hold government and public entities accountable’ in principle 4.

The project team agreed to delete the word “empowerment” and changed the wording as follows: “Principle 4: Reporting on audit results and thereby enabling the public to hold government and public sector entities accountable”

Kenya The guidance covers all the key areas of this Principle. However, we thought it could be strengthened by the inclusion of the following in regard to communication: i. SAIs should develop a clear strategy for

communicating and relating to their stakeholders and ensure that their staff understand the strategy including its application

ii. In communicating its reports and other messages, SAs should use mediums of communication that are cost-effective and accessible to the vast majority of its stakeholders

iii. SAIs should communicate their audit findings in a direct and unbiased manner by reporting things (audit findings) as they are

The project team considered the suggestion but found it too specific. The suggestions are already covered in general terms by principles 4 and 6.


PRINCIPLE 4: Reporting on audit results and thereby facilitating the empowerment of the public to hold government and public entities to accountable

The project team considered the suggestion but found the current wording to be appropriate.

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Further guidance can be found in the INTOSAI draft guideline: Communicating and Promoting the Value and Benefits of SAIs.


Comment received

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the project group



Mexico Comment on the footnote 7 (principle): Please also make reference to ISSAI 20.

The project team decided that it is not necessary to refer to ISSAI 20 at the principle level as the specific items under principle 4 which relate to ISSAI 20 have been referenced appropriately.

1. SAIs should report objective information in a simple and clear manner, using language that is understood by their stakeholders.


SAIs should report objective information in a simple and clear manner, using language that is understood by their all key stakeholders.

The project team changed the wording as follows: “SAIs should report objective information in a simple and clear manner, using language that is understood by all their stakeholders.”

2. SAIs should make their reports publicly available, in an accessible form and in a timely fashion.

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South Africa “SAIs should make their reports publicly available, in an accessible form and in a timely mannerfashion.”

The project team agreed with the suggested change.

Panama Principle 4: numeral 2, “SAIs should make their reports publicly available, in an accessible form and in a timely fashion”, we suggest adding: in accordance with the legal framework established.

The project team decided not to change the wording.

Mexico Comment on item 2 and 3: Which is the difference between these paragraphs?

The project team has clarified the difference by changing the wording of principles 4.2 and 4.3: “SAIs should make their reports publicly available in a timely manner.”

“SAIs should facilitate access to their reports by all their stakeholders using appropriate communication tools.”

3. SAIs should facilitate access to their reports by all key stakeholders.

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Panama Numeral 3 should start with “the”. Note by translator: this is not applicable as it concerns an addition to the Spanish version.

4. SAIs should interact appropriately with the media in order to reach out to the

South Africa “SAIs should interact appropriately with the media in order to keepreach out to the public informed.”

The project team agreed to change the wording as follows:

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Further guidance can be found in ISSAI 20, principle 8. 14

Further guidance can be found in ISSAI 20, principle 8.



public.15

“SAIs should interact appropriately with the media in order to facilitate communication with the citizens.” The project team also decided to move this item to principle 6.4.

Kenya We think that guidance No. 4 of Principle 4(Reporting on audit results) which deals with SAIs interaction with the media appears to be more suited for inclusion in Principle No 6 - Communicating effectively with stakeholders.

The project team agreed to change the wording as follows: “SAIs should interact appropriately with the media in order to facilitate communication with the citizens.” The project team also agreed to move this item to principle 6.4.

Mexico Comment: This paragraph could also be valid as part of Principle 6, which is focused on the effective communication with stakeholders.

The project team agreed to change the wording as follows: “SAIs should interact appropriately with the media in order to facilitate communication with the citizens.” The project team also agreed to move this item to principle 6.4.

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Comment received

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the project group DEMONSTRATING ONGOING

RELEVANCE TO CITIZENS AND OTHER STAKEHOLDERS To serve as a credible voice for beneficial change, it is important that SAIs have a good understanding of developments in the wider public sector and a meaningful dialogue with stakeholders about how the SAI’s work can support public sector improvement.

France p.8 after “To serve as a credible voice for beneficial change, it is important that SAIs have a good understanding of developments in the wider public sector and a meaningful dialogue with stakeholders about how the SAI’s work can support public sector involvement”, it could be added that “SAIs therefore need to dispose of concrete financial means and adequate legal possibilities for continuously improving their capacities, for directly interacting with the legislative, judicial and executive powers and for directly communicating with all civil society’s partners.”

The project team considered the suggestion but agreed that it is already covered under principle 1.8.


DEMONSTRATING ONGOING RELEVANCE OF SAIS’ WORK TO CITIZENS AND OTHER STAKEHOLDERS To serve as a credible voice for beneficial change, it is important that SAIs have a good understanding of developments in the wider public sector and undertake a meaningful dialogue with stakeholders about how the SAI’s work can support public sector improvement in the public sector.

The project team considered the suggestions but agreed to change the wording in accordance with the suggestions received from other SAIs. “Demonstrating ongoing relevance to citizens, Parliament and other stakeholders”. The project team agreed to make the changes suggested. The wording was changed to read as follows: “SAIs demonstrate ongoing relevance by responding appropriately to the challenges of citizens, the expectations of different stakeholders, and the emerging risks and changing environments in which audits are conducted. Furthermore, to serve as a credible voice for beneficial change, it is important that SAIs have a good understanding of developments in the wider




Comment received

from



the project group public sector and undertake a meaningful dialogue with stakeholders about how the SAI’s work can facilitate improvement in the public sector.”



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General comments on Principle 5 Kenya We propose the following addition: SAIs should review their strategies and operational systems regularly to ensure that they remain relevant to changing needs and circumstances on public sector accountability

The project team considered the suggestion and decided to add the following sentence to the paragraph following the objective: “SAIs demonstrate ongoing relevance by appropriately responding to the challenges of citizens, the expectations of different stakeholders, and the emerging risks and changing environments in which audits are conducted.”


PRINCIPLE 5: Demonstrating ongoing relevance to stakeholders by bBeing responsive to changing environments and emerging risks


1. SAIs should be aware of the expectations of stakeholders and respond to these, as appropriate, in a timely manner, without compromising their independence.

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Lesotho It is advisable to use indicative words which are more comprehensible to facilitate effective implementation of the requirements of the ISSAI. for example Principle 5 (1); if we say the SAI should be aware, the extent of awareness might not easily reveal the activity required in the ISSAI but if we may say " the SAI should make a thorough study or survey of the expectations of stakeholders.......... This might in a way provide a clear guidance of what the standard actually requires.

The project team decided that the current wording is appropriate. It is not necessary to specify the method used.

South Africa “SAIs should be aware of the expectations of stakeholders and respond to these, as appropriate, in a timely manner, and without compromising their independence.”


2. SAIs should in developing their work programme respond, as appropriate, to the key issues affecting society.

South Africa “SAIs should, in developing their work programme, respond, as appropriate, to the key issues affecting society.”

The project team agreed to make the following changes: “SAIs should, in developing their work programme, respond as appropriate to the key issues affecting society.”

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Comment received

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3. SAIs should evaluate changing and emerging risks in the audit environment and respond to these in a timely manner, for example by promoting mechanisms to tackle financial impropriety, fraud and corruption.

Malta NAO opines that more emphasis is to be placed on the importance of SAIs setting up and operating mechanisms to tackle financial impropriety, fraud and corruption. As a result, it is proposed that paragraph 3 of principle 5 should read: “SAIs should evaluate changing and emerging risks in the audit environment and respond to these in a timely manner.”

The project team considered the suggestion that the importance of having “mechanisms to tackle financial impropriety, fraud and corruption” should be emphasised. The project team included principle 2.3 to deal with this: “SAIs should respond appropriately, in accordance with their mandates, to the risks of financial impropriety, fraud and corruption.”

South Africa “SAIs should evaluate changing and emerging risks in the audit environment and respond to these in a timely manner, for example by promoting mechanisms to addresstackle financial impropriety, fraud and corruption.”


Iraq Item 3 - the word (change) occurred in the first line and is amended to (evaluating risks’ change). In the second line, the word (fight) before corruption to become (dealing with fighting corruption)

The project team decided that the current wording is clearer than the suggested wording and therefore kept the original wording.

4. SAIs should ensure that stakeholders’ expectations and emerging risks are factored into strategic, business and audit plans, as appropriate.

5. SAIs should keep abreast of topical matters being debated in domestic and international forums and participate where appropriate.

Iraq Item 5 – omitting (as appropriate) occurring at the end of the paragraph.

The project team decided that it is important to keep the wording “where appropriate”.

Mexico We suggest elaborating more, so that it could be clear the reference made to “topical matters”

The project team agreed to change the wording as follows: “SAIs should keep abreast of relevant matters being debated in domestic and international forums and participate where appropriate.”



6. SAIs should establish mechanisms for information gathering, decision making and performance measurement to enhance relevance to stakeholders.

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Malta Relate to comment under principle 5 paragraph 3 - After paragraph 6 of principle 5, an additional paragraph would then be added stating: “SAIs are to institute and implement appropriate mechanisms to tackle financial impropriety and mismanagement, fraud and corruption.”

The project team decided to keep the current wording because the suggestion is already covered in principle 5.3.

Hungary Provision 6 of Principle 5 could be moved to the end of Principle 9. In this case, the last clause (‘to enhance relevance to stakeholders’) should be cancelled, thus the provision would read as follows: ‘SAIs should establish mechanisms for information gathering, decision making and performance measurement’. Its content fits more into Principle 9.

The project team decided to keep the current wording because the guidance is related to specific mechanisms to gather information that will enable SAIs to make better decisions and improve their performance to be more relevant to their stakeholders.

Mexico “SAIs should establish mechanisms for information gathering, decision making and performance measurement to respond properly to the developments, challenges and demands arising their audit environments and in the overall public administrationenhance relevance to stakeholders.” The proposed wording seeks to emphasize the contribution of SAIs’ performance measurement (SAI PMF) before diverse scenarios. Evidently the objective is “to enhance relevance to stakeholders”, but this has already been mentioned in the title of the corresponding principle.

The project team decided to keep the guidance general. The suggestion was therefore not incorporated.

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Draft SAI Performance Measurement Framework.



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General comments on Principle 6 Nyenrode Business University, The Netherlands

Principle 6: we suggest to reconsider the text of the guidance, in order to reflect that communication is two-sided: not only from the SAIs to stakeholders, but also from the stakeholders to the SAIs: SAIs should not only send, but also receive (be curious and listen);

The project team considered the suggestion but agreed that it is already covered by principle 6.5.

Peru We recommend including in principle 6, referred to “Communicating effectively with stakeholders”, citizen participation in the control of public resources. “SAIs may also, in accordance with their mandates, promote citizen participation through specific mechanisms, such as a complaints and reports office related to mismanagement and inadequate assistance of public services.”

The project team decided that “citizens” are stakeholders as defined. The project team also added principle 6.4 to increase the emphasis on citizens.

Kenya We think that guidance No. 4 of Principle 4(Reporting on audit results) which deals with SAIs interaction with the media appears to be more suited for inclusion in Principle No 6 - Communicating effectively with stakeholders.

The project team agreed to change the wording as follows: “SAIs should interact appropriately with the media in order to facilitate communication with the citizens.” The project team agreed to move the item to principle 6.4.


PRINCIPLE 6: Communicating SAIs’ role and responsibilities effectively withto stakeholders

The project team decided to keep the principle general. Principle 6.1 refers to communicating the role and responsibilities of SAIs.

1. SAIs should communicate in a manner that increases stakeholders’ knowledge and understanding of the role and responsibilities of the SAI as an independent auditor of the public sector.

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Comment received

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the project group



2. SAIs’ communication should contribute to public and political awareness of the need for transparency and accountability in the public sector.

Canada In guidance 2 under Principle 6, the word “political” could be replaced by “awareness by legislative assemblies” in order to avoid any confusion.

The project team considered the suggestions and changed the wording as follows: “SAIs’ communication should contribute to stakeholders’ awareness of the need for transparency and accountability in the public sector.”

Malta Paragraph 2 of Principle 6 should be amended to read as follows: “SAIs’ communication should contribute to public and political awareness of the need for transparency, accountability, propriety and value for money in the public sector.”

The project team considered the suggestion but agreed that the suggestion is too specific. The term accountability does cover “efficiency in the use of public funds”, thus dealing with “propriety and value for money”.

3. SAIs should communicate with stakeholders to ensure understanding of the SAI’s audit work and results.

Mexico Paragraphs 1 and 3 of Principle 6 could be merged taking into account that both make reference to the required communication between SAIs and stakeholders for the latter to understand SAIs’ role and responsibilities as independent auditor of the public sector. A single provision could be sufficient, just emphasizing the availability and accessibility of SAIs’ information on their work and results.

The project team considered the suggestion but decided to keep the paragraphs separate. One speaks to the role and responsibilities of SAIs and the other to the SAI product.

4. SAIs should ensure good communication with auditees and other related stakeholders, as appropriate, and keep them well informed during the audit process of the matters arising from the SAI’s work.


This guidance is linked with enabling auditees to respond to audit findings, ie, part of the audit process. We suggest moving this to principle 3 as number 1

The project team agreed to move principle 6.4 to principle 3.1.

Mexico It could also be convenient that SAIs ensure good communication with auditees and other related stakeholders (particularly the legislative branch or the Congress), as appropriate, to keep them timely and well informed on developments and challenges in the audit environment, and also on the risks that stakeholders themselves would face, without compromising SAIs’ independence. If a SAI complies with the provisions stated in Principle 5, then it would count on mechanisms for information gathering and decision making, whose outcomes (e.g. economic studies or risks analysis) could be communicated (Principle 6) and provide

The project team agreed to move principle 6.4 to principle 3.1. The project team decided that paragraph 5.6 does deal with the communication of the results of information gathering etc. To be relevant it has to be



relevant information to the relevant stakeholders. Subject to your validation, this could be included as a new provision within principle 6.

communicated.

5. SAIs should engage with stakeholders, recognising their different roles, and consider their views, without compromising the SAI’s independence.

6. SAIs should periodically assess whether stakeholders believe the SAI is communicating effectively.

Panama Principle 6: numeral 6. “SAIs should periodically assess whether stakeholders believe the SAI is communicating effectively”. We suggest adding: in order to acknowledge stakeholders opinion on the work of SAIs.

The project team considered the suggestion and decided that this is already covered in principle 6.6.



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General comments on Principle 7 Denmark These five items render an excellent description of the key role of SAIs

Noted.

Kenya For emphasis the guidance could include the following assertion: i. In choosing areas to audit, SAIs should be

conscious of their role as catalysts for positive /beneficial change in management of public resources and should therefore invest more resources and effort in areas and issues that maximize benefits to citizens

ii. In making audit recommendations or following-up on the their implementation by audited entities SAIs should whenever possible quantify the benefits that their audits bring to citizens.

The project team decided that the suggestions are already covered in principles 7.2 – 7.4.

USA Observation One In exposing the draft ISSAI for comment, the WGVBS asked for views on whether all the key principles have been included in the exposure draft. In our view, the 12 principles proposed provide the foundation for strengthening the relevancy of SAIs in their respective environments. SAIs have the unique opportunity to support beneficial change through adherence to recognized professional auditing standards. This can be accomplished by referring to the key audit concepts of reasonable assurance and due professional care. We believe that Principle 7, Being a credible source of independent and objective insight and guidance to support beneficial change in government and public entities, should recognize that given the crosscutting governance challenges confronting each nation (e.g., climate change, responding to the global financial crisis, and global supply chains), SAIs need to increasingly work in a collaborative and coordinated way with each other and, as appropriate, within their broader national “accountability community” if they are to be effective.

The project team decided that principle 7.5 addresses the suggestion made by the SAI.


Comment received

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the project group



Recommendations We recommend inserting the following provision into Principle 7 and renumbering it as follows: 2. SAIs should obtain reasonable assurance that evidence is sufficient and appropriate and exercise due professional care to enhance confidence in public sector auditing.

The project team decided that the suggestion is covered in principle 2.1.

USA We also recommend adding the following provision to Principle 7: 7 SAIs should be active participants in the international and national accountability communities by sharing knowledge and best practices, for example, on approaches and methodologies for assessing complex governance structures and, as appropriate, coordinating and collaborating on performance audits.

The project team decided that the suggestion is already covered by principles 12.6 and 12.7.

1. To maintain their credibility, SAIs’ work should be based on independent professional judgement and sound and robust analysis.

USA To maintain their credibility, SAIs’ work should be based on independent professional judgement, including the exercise of reasonable care and professional scepticism, and sound and robust analysis.

The project team decided that the suggestion is implicit in and already covered by professional judgement.

Mexico “… professional judgement and sound and robust analysis.”

The project team decided that the word “judgement” (English UK) was spelled correctly.

2. SAIs’ work should be used to help inform the debate on improvements in the public sector without compromising their independence.

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Principle 7, p.2 – SAIs’ work should be used to help inform the debate on improvements in the public sector without compromising their independence. Please specify what is meant by „inform the debate”.

The project team considered the suggestion and changed the wording as follows: “SAIs should contribute to the debate on improvements in the public sector without compromising their independence.”


Principle 7, point 2, and principle 8, point 1: these issues cannot be controlled completely by the SAIs themselves. SAIs can promote the use of their work and the establishment of an adequate legal framework, but other parties are responsible for

The project team decided to change the wording to the following: “SAIs should contribute to the debate on improvements in the

19




actually using the work and actually regulating. We suggest to reflect this reality in the wording;

public sector without compromising their independence.”

Mexico “SAIs’ work should be used to help inform the debate on improvements and risks in the public …”

The project team decided that the suggested change is not necessary, as by nature the improvements would address the risks.

3. SAIs should periodically assess whether stakeholders recognise SAIs’ effectiveness and contribution to improvements in the public sector.

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South Africa “SAIs should periodically assess whether stakeholders recognisebelieve that the SAIs’ is effectiveness and contributingion to improvements in the public sector.” The wording was presuming that the SAI is effective

The project team decided to make the following change: “SAIs should periodically assess whether stakeholders believe that they are effective and contribute to improvements in the public sector.” The project team also decided to move the item to principle 7.4.


... recognise SAIs’ effectiveness and their contribution ...

The project team considered the suggestions but the following changes were made to the wording: “SAIs should periodically assess whether stakeholders believe that they are effective and contribute to improvements in the public sector.”

4. In their role as active partners in the national and international public sector auditing profession, SAIs should advocate innovations and reforms, sharing their knowledge and insights, in a manner that does not compromise their independence.

Canada In point 4 of principle 7 under the second objective we would suggest removing the words “and reforms” from the sentence. Again, while a SAI’s work may indirectly lead to reform, it is not necessarily a role that it must give itself from the outset.

The project team decided that SAIs are able to “advocate” reform.


... advocate innovations and reforms in public sector management, sharing their knowledge and insights, in a manner that ...

The project team decided to change the wording as follows: “SAIs should, as active partners in the national and international public sector auditing profession, use their knowledge

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Draft SAI Performance Measurement Framework.



and insights to advocate public sector reforms, for example in the area of public financial management.”

5. SAIs should collaborate internationally within INTOSAI and with other relevant professional organisations in order to promote the role of the SAI community in addressing global issues related to public sector auditing, accounting and accountability.




Comment received

from



the project group BEING MODEL ORGANISATIONS

THROUGH LEADING BY EXAMPLE

SAIs must be trustworthy. Their credibility depends on being seen as competent, independent and publicly accountable for their operations. In order to make this possible SAIs need to lead by example.

France p.9 after “Their credibility depends on being seen as competent, independent and publicly accountable for their operations. In order to make this possible SAIs need to lead by example”, it could be added that “SAIs therefore should need to take by themselves an active part within the legal process that determines their mandate and their duties, in order to find the right balance between the necessity of an external control of their activities and the fact that their independence must remain unconditional”.

The project team decided that the suggestion is already covered in principles 1.1 and 8.1.


SAIs must be trustworthy. Their credibility depends on being seen as competent, independent and publicly accountable for their operations. In order to make this possible SAIs need to lead by example.

The project team agreed with the suggested corrections.



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General comments on Principle 8 Denmark

Principle 8 presents very well the importance of transparency and accountability of SAIs and principle 9 is referring to other elements of good governance. Transparency and accountability are generally perceived as the central pillars of good governance, and we therefore suggest merging principles 8 and 9. This solution would also solve the problem over overlap between the two principles (example: item 5 in principle 8 and item 2 in principle 9). A new headline for a merged principle 8 could read: “Ensuring appropriate transparency and accountability and good public governance of SAIs”

The project team decided that these are two different issues. Principle 8.5 relates to external audits. Principle 9.2 relates to peer reviews. The project team made changes to reflect the differences: Principle 8.5 – “SAIs should be subject to independent external scrutiny, including external audit of their operations, and make these reports available to stakeholders.” Principle 9.2 – “SAIs should periodically submit their performance to independent review, for example peer review.”


Principle 8: we suggest to include ‘assessment and public reporting of audit impact’ (both intended and unintended).

The project team decided that the guidance contained in principle 8 relates to ISSAI 20: Principles of transparency and accountability. The suggestion relates more to the impact of SAIs’ reports and for this reason the suggestion was not included.

Kenya We propose the following assertion: SAIs should continually improve their management systems to ensure that they support the principles of transparency and accountability

The project team decided that the suggestion is already covered under principle 9.3.

Mexico Comment on the footnote to the principle: Please also make reference to ISSAI 20.

The project team decided that footnote 16 does refer to ISSAI 20.

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Further guidance can be found in ISSAI 20.


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1. SAIs should perform their duties under a legal framework that provides for accountability and transparency.

Denmark Principle 8 – item 1: Generally, SAIs limited influence on the legal framework under which they perform their duties and we therefore propose the following minor adjustment: “SAIs should perform their duties in a manner that provides for accountability and transparency and good public governance”.



Principle 7, point 2, and principle 8, point 1: these issues cannot be controlled completely by the SAIs themselves. SAIs can promote the use of their work and the establishment of an adequate legal framework, but other parties are responsible for actually using the work and actually regulating. We suggest to reflect this reality in the wording;

The project team decided that the inclusion of the suggestion above from Denmark covers the concern raised.

Hungary Principle 8, Provision 1: we suggest the following amendment: ‘…that provides for the SAI’s accountability and transparency’.

The project team decided that the inclusion of the suggestion above from Denmark covers the concern raised.

2. SAIs should make public their mandate, responsibilities, mission and strategy.

Hungary Principle 8, Provision 2: please place ‘responsibilities’ at the end of the sentence. Thus, the sentence would read as follows: ‘SAIs should make public their mandate, mission, strategy and responsibilities’.

The project team decided to keep the current sentence.

3. SAIs should use audit standards, processes and methods that are objective and transparent, and make known what standards and methods are used.

South Africa “SAIs should use auditing standards, processes and methods that are objective and transparent, and make known what standards and methods are used.”

The project team agreed with the suggestion.

Hungary Principle 8, Provision 3: In order to include considerations connected with the independence of SAIs, please consider to amend the provision as follows: ‘SAIs should autonomously decide on their own audit standards, processes and methods that have to be objective and transparent. SAIs should make known what standards and methods they use.’ (From editorial point of view, if a provision shall contain only one sentence the two sentences could be merged or the provision could be split into two.)

The project team considered the suggestion and made the following change: “SAIs should use, as appropriate for their circumstances, auditing standards, processes and methods that are objective and transparent, and make known to stakeholders what standards and methods are used.”


SAIs should use audit standards, processes and methods that are objective and transparent, and make them known to stakeholderswhat standards and methods are used.

The project team considered the suggestion and made the following change: “SAIs should use, as



appropriate for their circumstances, auditing standards, processes and methods that are objective and transparent, and make known to stakeholders what standards and methods are used.”

4. SAIs should manage their operations economically, efficiently, effectively and in accordance with laws and regulations, and report publicly on these matters using an appropriate performance measurement framework.

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USA SAIs should manage their operations economically, efficiently, effectively and in accordance with laws and regulations, and report publicly on these matters using an appropriate performance measurement framework.

The project team considered the suggestion and made the following amendments: “SAIs should manage their operations economically, efficiently, effectively and in accordance with applicable laws and regulations, and report publicly on these matters, as appropriate.”


... efficiently, effectively and in accordance with all applicable laws and regulations, and report publicly ...

The project team considered the suggestion and made the following amendments: “SAIs should manage their operations economically, efficiently, effectively and in accordance with applicable laws and regulations, and report publicly on these matters, as appropriate.”

Mexico “…publicly on these matters using an appropriate annual management / performance reportmeasurement framework.” Further comment: This provision is included within principle No. 8 regarding transparency and accountability of SAIs. We consider that this principle should only include provisions related to the public visibility of SAIs, its standards and processes, and reporting. Hence, any reference to the SAI PMF should be made within Principle 9 “Ensuring good governance of SAIs”, which is aimed at helping SAIs to improve its governance, performance and proper

The project team considered the suggestion and decided that the changes above address the suggestion made.

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management. We recommend transferring the reference to the SAI PMF to provision No. 2 of Principle 9.

5. SAIs should be subject to independent external scrutiny, including external audit of their operations.

Austria In Principle 8, item 5 “SAIs should be subject to independent external scrutiny, including external audit of their operations” should clarify - perhaps in brackets - that peer reviews are considered as such external scrutiny.

The project team decided to include this suggestion in principle 9.2.

Kingdom of Bahrain

A new paragraph (e.g. 6.) in Principle 8, can be added mentioning that SAI should apply the role of declaration of financial position for the SAI's staff members, as a concept of transparency and accountability.

It is an important aspect of transparency; however, the project team considered the suggestion but found it too specific for this ISSAI. One could consider this to be covered, in a broad sense, by principle 10, relating to the code of conduct and code of ethics pointing to other relevant INTOSAI standards on ethics. See ISSAI 40, 3.17.

USA Suggestion for adding a additional paragraph: SAIs should identify appropriate performance metrics and publicly, objectively, and regularly report the SAI’s performance as measured against those metrics using an appropriate performance measurement framework.

The project team considered the suggestion but found it too specific. The suggestion is already covered in general terms in principle 9.2.

Mexico The essence of this paragraph seem to be identical to paragraph No. 2 of Principle 9, which makes reference to (internal and external) objective oversight of SAIs’ performance. To avoid having overlapping provisions, we suggest elaborating paragraph No. 5 of Principle 8, so that it could be focused on the dissemination of the external audit report, and not on the process itself.

The project team decided that these are two different issues. Principle 8.5 relates to external audits. Principle 9.2 relates to peer reviews. The project team made changes to reflect the differences: Principle 8.5 – “SAIs should be subject to independent external scrutiny, including external audit of their operations, and make these reports available to stakeholders.” Principle 9.2 – “SAIs should periodically submit their performance to independent



review, for example peer review.”



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General comments on Principle 9 Denmark Principle 8 presents very well the importance of transparency and accountability of SAIs and principle 9 is referring to other elements of good governance. Transparency and accountability are generally perceived as the central pillars of good governance, and we therefore suggest merging principles 8 and 9. This solution would also solve the problem over overlap between the two principles (example: item 5 in principle 8 and item 2 in principle 9). A new headline for a merged principle 8 could read: “Ensuring appropriate transparency and accountability and good public governance of SAIs”.

The project team decided that these are two different issues. Principle 8.5 relates to external audits. Principle 9.2 relates to peer reviews. The project team made changes to reflect the differences: Principle 8.5 – “SAIs should be subject to independent external scrutiny, including external audit of their operations, and make these reports available to stakeholders.” Principle 9.2 – “SAIs should periodically submit their performance to independent review, for example peer review.”

Hungary Principle 9: It could be reasonable to include (as a thumb rule) the general requirement of a sound internal control system. Please consider adding a new Provision 3 as follows: ‘SAIs should set up and operate adequate internal controls.’ This new provision could even replace the current Provision 3.

The project team considered the suggestion and agreed to change principle 9.3 to address the suggestion. “SAIs should have an appropriate organisational management and support structure that will give effect to good governance processes and support sound internal control and management practices.”

Kenya The guidance could consider the following additional assertion: SAIs should encourage their managers and staff to embrace and promote principles of good governance in their work.

The project team decided that the suggestion is covered by principle 9.1, “adopt and comply”.

1. SAIs should adopt and comply with good governance principles and report appropriately thereon.


Principle 9 p.1 – In order to be consistent we would suggest using a reference when speaking about “good governance principles” (e.g. a reference to INTOSAI Guidance for Good Governance).

The project team considered the suggestion and found it too detailed.


Comment received

from



the project group



2. SAIs should periodically submit their performance to objective oversight, without compromising their independence.

Iraq Item 2 – amending (to be presented periodically) to become (evaluating their performance periodically).

The project team considered the suggestion and decided to make the following changes: “SAIs should periodically submit their performance to independent review, for example peer review.”

Mexico “…oversight and measurement23

, without compromising their independence.”

The project team considered the suggestion and decided to make the following changes: “SAIs should periodically submit their performance to independent review, for example peer review.”

3. SAIs should have an appropriate organisational management structure that will give effect to good governance processes and support sound project management practices.

Panama Principle 9: page 6, number 3: SAIs should have an appropriate organizational management structure that will give effect to good governance processes and support sound project management practices”. We suggest that the paragraph be corrected, as it may seem confusing, which may be due to the translation.

(Note of translator: The comment is not applicable as it refers to a misunderstanding on the translation of the ISSAI.)

USA SAIs should have an appropriate organisational management and support structure that will give effect to good governance processes and support sound project management practices.

The project team agreed with the suggested change.

4. SAIs should assess organisational risk on a regular basis and supplement this with appropriately implemented and regularly monitored risk management initiatives, for example through an appropriately objective internal audit function.

USA Suggestion to add a additional paragraph: SAIs should implement ISSAI in accordance with their mandate and national legislation and regulations.

The project team decided that the suggestion is already covered in general terms in principle 8.3.

23

Draft SAI Performance Measurement Framework



General comments on Principle 10 European Court of Auditors

PRINCIPLE 10: Complying with the SAI’s Code of Ethics

The project team decided that the original wording is correct.

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1. SAIs should apply a Code of Ethics that is at least as demanding as the relevant INTOSAI standards.

Denmark Principle 10 – item 1: We think that the phrase: ‘at least as demanding as” has a slightly negative ring and therefore suggest the following amendments: “SAIs should apply a Code of Ethics as defined in the INTOSAI standards”.

The project team considered the suggestion and made the following changes: “SAIs should apply a Code of Ethics that is consistent with their mandate and appropriate for their circumstances, for example the INTOSAI Code of Ethics.”

2. SAIs should institute appropriate policies and processes to ensure awareness of and adherence to the requirements of the Code of Ethics within the SAI, for example dealing with any breaches.


... the Code of Ethics within the SAI, for exampleincluding establishing procedures for dealing with any breaches.

The project team considered the suggestion and made the following changes: “SAIs should institute appropriate policies and processes to ensure awareness of and adherence to the requirements of the code of conduct within the SAI.”

Mexico “… Code of EthicsConduct within the SAI, for example dealing with any integrity breaches and conflicts of interest.”

The project team considered the suggestion and made the following changes: “SAIs should institute appropriate policies and processes to ensure awareness of and adherence to the requirements of the code of conduct within the SAI.”

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Comment received

from



the project group



3. SAIs should apply high standards of integrity and ethics, for example as expressed in a code of conduct.

25

Mexico “…for example as expressed in a code of ethicsconduct.” Additional comment: In the SAI of Mexico, the concept “code of conduct” refers to an internal regulation establishing the institutional provisions governing public officers’ conduct, as well as the internal processes to be followed up before any identified integrity breaches. The concept “code of ethics” is considered, on the other hand, also a key document, but establishing universal ethical principles and values to be observed. While a code of ethics could be, at a certain extent, applied to different public entities, a code of conduct should be developed according to each institution’s culture, work scope and characteristics. The aforementioned seeks to justify the amendments made in provisions 2 and 3 with regard to these concepts.

The project team considered the suggestion and agreed that the reference should be to the code of conduct and not the code of ethics.

4. SAIs should publish their core values and commitment to professional ethics.

5. SAIs should live their core values and commitment to professional ethics in order to serve as an example to their stakeholders.

Iraq Item 5 – concerning the last phrase of the paragraph (a model to be followed by their beneficiaries), we think it needs more clarification.

The project team considered the suggestion and made the following change: “SAIs should apply their core values and commitment to professional ethics in all aspects of their work, in order to serve as an example.”

Kingdom of Bahrain

As an example for paragraph number (5) of Principle 10, we can add the practice of declaration of related parties in the auditees' site by the SAI's staff members.

The project team decided that the suggestion is too detailed.

25





SAIs should live fully apply their core values and commitment to professional ethics in all aspects of the professional and administrative work, in order to serve as an example to their stakeholders.

The project team considered the suggestion and decided to make the following change: “SAIs should apply their core values and commitment to professional ethics in all aspects of their work, in order to serve as an example.”

Mexico Suggested additional item nr. 6:

SAIs’ policies and procedures should require all personnel and all parties doing work on behalf of the SAI to comply with the relevant ethical requirements.

The project team decided that the suggestion is already covered in principle 11.2.



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General comment on Principle 11 USA Observation Two In addition, we believe that Principle 11, Striving for service excellence and quality, could be strengthened by expanding the description to incorporate the concepts of quality control and assurance. Recommendations We recommend expanding Principle 11 to incorporate quality control and assurance and to read as follows: Striving for service excellence and quality control and assurance We also recommend that an additional provision be added to Principle 11 to support this concept and recommend adding the following language: 7. Establish and maintain a system of quality control that is designed to provide the SAI with reasonable assurance that the SAI and its personnel comply with professional standards and applicable legal and regulatory requirements.

The project team decided that a SAI cannot strive for quality control and assurance. The goal is quality. The project team decided that the guidance contained in principle 11 provides for a system of quality control as required by ISSAI 40.

Kenya The guidance could also include: SAIs should always strive to produce high quality audit reports in a cost-effective manner.

The project team decided that the suggestion “strive to produce high-quality audit reports” is covered under principle 11. Cost-effectiveness is covered under principle 8.4.

26



Comment received

from



the project group



1. SAIs should set policies and procedures designed to promote an internal culture recognising that quality is essential in performing all the SAI’s work.


... internal culture that recogniseing that quality is essential in performing all aspects of the SAI’s work.

The project team decided to make the suggested changes.

Mexico “… set quality control system, including policies and procedures designed …”

The project team decided that the current wording as included in 11.1 – 11.6 sufficiently covers the suggestion made by Mexico.

2. SAIs’ policies and procedures should require all personnel and all parties doing work on behalf of the SAI to comply with the relevant ethical requirements.

Panama Principle 11: numeral 2, we consider that SAIs must require all personnel and all parties doing work on behalf of the SAI to comply with honesty, truth, clarity and justice to every policy and ethical requirements.

The project team decided that the suggestion is too specific. The language used is aligned with ISSAI 40.


SAIs’ policies and procedures should require all personnel and all parties doing working on behalf of the SAI to comply with the relevant ethical requirements. This guidance is directly linked to complying with the SAI Code of Ethics. We suggest moving this to principle 10 as number 6


Mexico “…relevant ethical quality requirements.” The project team decided to use the current wording, as the language used is aligned with ISSAI 40.

3. SAIs’ policies and procedures should stipulate that the SAI will only undertake work that it is competent to perform, while managing the risks to quality.

South Africa “SAIs’ policies and procedures should stipulate that the SAI will only undertake work that it is competent to perform, while managing the risks to quality.”


4. SAIs should ensure that they have sufficient and appropriate resources to perform their work in accordance with relevant standards and other requirements, including having timely access to external and independent advice where necessary.

Denmark Principle 11 – item 4: SAIs generally have limited influence on the amount of resources that are made available to them and are therefore not positioned to ensure that they have sufficient. We suggest deletion of “ensure that they”, so that the sentence instead reads: “SAIs should have sufficient and appropriate resources …”.


Malta In addition, paragraph 4 of Principle 11 would read as follows: “SAIs should ensure that they have sufficient and appropriate resources, including adequate funding, to perform their work in

The project team decided to use the current wording, as the language used is aligned with ISSAI 40.



accordance with relevant standards and other requirements including having timely access to external and independent advice where necessary.”

5. SAIs’ policies and procedures should promote consistency in the quality of their work and should set out responsibilities for supervision and review.

6. SAIs should establish an internal and external monitoring process that ensures that the SAI’s system of quality control is relevant, adequate and operating effectively.

Austria In Principle 11, item 6 “SAIs should establish an internal and external monitoring process that ensures that the SAI’s system of quality control is relevant, adequate and operating effectively”, the phrase “internal and external” should be deleted entirely because the decision to implement an internal and/or external monitoring process should be left to the head of the respective SAI.

The project team decided to make the following change: “SAIs should establish a monitoring process that ensures that the SAI’s system of quality control, including its quality assurance process, is relevant, adequate and operating effectively.”

Chile Propose: 6. SAIs should establish and internal and external monitoring process that ensures that the SAI´s system of quality control is relevant, adequate and operating effectively and quality assurance process in place.

The project team agreed to make the following change: SAIs should establish a monitoring process that ensures that the SAI’s system of quality control, including its quality assurance process, is relevant, adequate and operating effectively.



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General comments on Principle 12 ARABOSAI However, principle 12 needs some comments. In fact, we consider that capacity building can constitute a principle in itself without being combined with “promoting learning and knowledge sharing” as written in the draft. We can refer to IDI guide about “building capacity in SAIs” (2007) to put the guidance supporting this key principle as follows

27:

SAIs should

- systematically assess their current level of capacity, and their strengths and weaknesses;

- determine what additional capacity they seek to build, the resources it will need and the outcomes they expect to achieve;

- develop a strategy for delivery of this increased capacity, and related outcomes;

- implement this strategy; - evaluate the impact of the changes and the

outcomes achieved; and sustain the changes and develop a new strategy to build on what has been achieved.

The project team decided that the suggestion is too detailed and that the footnote makes sufficient reference to the guide.

Kenya The guidance could in addition include the following assertion: SAIs should organize their internal structures in a way that facilitates internal knowledge sharing and continuous learning in order to keep abreast of changing professional and service demands from citizens and stakeholders

The project team decided that the suggestion is already covered in principles 12.1, 12.2, 12.3 and 12.4

1. SAIs should have a professional development strategy, including training, that is based on the minimum levels of qualifications, experience and competence required to carry out the SAI’s work.

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IDI guide page 6. 28

Further guidance can be found in “Building capacity in Supreme Audit Institutions – A guide”


Comment received

from



the project group



2. SAIs should encourage knowledge sharing and capacity building in support of the delivery of outputs and outcomes.


... delivery of outputs and outcomes. The project team agreed to make the suggested change.

3. SAIs should promote continuing professional development that contributes to individual, team and organisational excellence.

Iraq Item 3 – we suggest amending it to be as follow: (SAIs should continue professional and scientific development that contributes in improving the individuals, reams and organisational superiority).

The project team found the current wording more internally consistent with the balance of the principles and guidance.

4. SAIs should strive to ensure that their staff have the professional competencies and the support of colleagues and management to do their work.

South Africa “SAIs should strive to ensure that their personnelstaff have the professional competencies, capacities and the support of colleagues and management to do their work.”

The project team decided to keep the wording consistent with the Lima Declaration, thus prefers referring to “staff”.


... staff have the necessary professional competencies, as well as and the support of colleagues and management to do their work.

The project team decided that the suggestion does not change the meaning of the sentence.

5. SAIs should draw on the work of others, including peer SAIs and INTOSAI, as appropriate, without compromising their independence.


Principle 12. p.5 - SAIs should draw on the work of others, including peer SAIs and INTOSAI, as appropriate, without compromising their independence. Please specify what is meant by „draw on”.

The project team decided that the current wording reflects what is intended.

South Africa “SAIs should draw on the work of others, including peer SAIs and INTOSAI, as appropriate, without compromising their independence.”



SAIs should draw on the work experience and best practice of others, including peer SAIs and INTOSAI, as appropriate, without compromising their independence.

The project team decided that “work” is general enough and it is not necessary to refer to experience and best practice.

Mexico ”… including collaboration with peer SAIs, and INTOSAI and their regional working groups, and relevant national organizations promoting the public auditing profession, as appropriate, without compromising their independence.”

The project team considered the suggestion and made the following changes: “SAIs should draw on the work of others, including peer SAIs, INTOSAI and relevant regional working groups.”

6. SAIs should strive to co-operate with the broader auditing profession in order to enhance the profession.


Principle 12. p.6 - SAIs should strive to co-operate with the broader auditing profession in order to enhance the profession. Please specify what is meant by „to co-operate with profession”.

The project team considered the suggestion and decided that the key words are to co-operate with the “broader auditing” profession.

Mexico “… to co-operate with the broader auditing profession in order to enhance the profession it and

The project team decided that the purpose of the ISSAI is to



help promoting and communication its value and benefits of the society.”

add value and benefits for the citizens, thus it is unnecessary to mention it here.

7. SAIs should strive to participate in INTOSAI activities and build networks with other SAIs and relevant institutions, to keep abreast of topical issues and promote knowledge sharing to benefit other SAIs.

Denmark Principle 12 – item 7: In our opinion the requirements of item 5 cover also the requirements listed in item 7, and we therefore suggest deletion of item 7

The project team considered the suggestion and decided to make changes to principles 12.5 and 12.7: Principle 12.5: “SAIs should draw on the work of others, including peer SAIs, INTOSAI and relevant regional working groups.” Principle 12.7: “SAIs should strive to participate in INTOSAI activities and build networks with other SAIs and relevant institutions, to keep abreast of emerging issues and promote knowledge sharing to benefit other SAIs.”




Comment received

from


Response and final changes recommended by the project group

AN

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The extent to which SAIs are able to make a difference to the lives of citizens depends on SAIs:

Denmark We propose the following addition to the centre triangle: “SAIs making a difference to parliament as well as the lives of citizens”

The project team decided not to make the suggested change as the purpose of the document is to improve the lives of citizens.

AN

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The 12 principles of the value and benefits of SAIs under each of the three objectives are:

Denmark This figure provides an excellent overview of the 12 principles. We propose the same addition as under annexure A.

The project team decided not to make the suggested change as the purpose of the document is to improve the lives of citizens.

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Comparison between the Framework for Communicating and Promoting the Value and Benefits of SAIs as presented at the XXth INCOSAI, 2010 and the draft ISSAI X

Denmark Where the two aforementioned figures serve the purpose of illustrating the importance of SAIs and the principles governing their activities, this figure seems to be a litter out of place. We are concerned that it may be the cause of confusion and we do not think that it is relevant for the understanding and reading of ISSAI X. We therefore suggest that it is excluded from the document.

The project team removed “Annexure C”.

United Kingdom

“Annexure” C evidence the completeness of the output (draft ISSAI X) compared with the mandate given by INCOSAI (based on the 2010 Framework). This is helpful information for the ED process but not necessary or appropriate once the final document is adopted and stands in its own right. “Annexures” A and B add value by making the content, inter-relationship and structure of the document understandable at a glance.

The project team removed “Annexure C”.



USA Observation Three We agree with the WGVBS’s decision to look to the Framework as a source for the principles to be included in the ISSAI. However, users of this ISSAI would benefit from a mapping of the relationship between these documents and an explanation of the differences in objectives between the ISSAI and the Framework. For example, the WGVBS draws a parallel between the draft ISSAI’s Principle 5, Demonstrating ongoing relevance to stakeholders by being responsive to changing environments and emerging risks, and Framework Requirement 1, “Responsiveness to changing environments and stakeholder expectations, without compromising independence.” In our view, there is a marked difference between the steps an SAI would take to respond to stakeholder expectations in accordance with the framework requirement and those necessary to demonstrate relevance per the draft Principle 5. Recommendation We recommend that as the ISSAI 2 exposure draft is finalized, the ISSAI be mapped accordingly and aligned with the fundamental requirements outlined in objective 1 of the Framework.

The project team removed “Annexure C”. However, although wording used in principle 5 is not directly aligned with the wording used in fundamental requirement 1, the guidance contained under principle 5 is consistent with the guidance previously contained under fundamental requirement 1.

Documents

INTOSAI comments on the exposure draft of ISSAI X … No. 10... · performance indicators refer ... organisational level requirements for audit quality. ... 2 thReport on the 20 UN/INTOSAI