1. AUDIT IN PUBLIC ADMINISTRATION Assoc. Prof. Dr. Recai AKYEL President of the TCA 04 JUNE 2013 TIRANA/ALBANIA

2. 2 INTRODUCTION As the President of the Turkish Court of Accounts (TCA), my fundamental duty is: To draw the attention of people and public to audit, and to create awareness, To work in matters of conducting the audit accurately and obtaining accurate results.

3. Important matters related to audit 3 Audit is of vital importance, and it is a necessity. Audit should be carried out accurately. Accurate audit is useful; inaccurate audit is harmful. There should be consensus and agreement between auditors, auditees, stakeholders and public in matters of audit objective, scope and content. Public has little interest in audit, and it does not have sufficient information about audit.

4. 4 DEFINITION Audit : It is an examination process for identifying whether the operations and transactions of an entity are performed in accordance with the pre- determined objectives and rules. At the end of the audit, findings are obtained and reports are written. Audit findings are used in many ways.

5. 5 DEFINITION -2 Daily language has similar concepts used interchangeably in relation to audit: -Audit, -Control/controller -Inspection, -Examination, -Monitoring, -Supervision, -Investigation-review-inquiry.

6. 6 TERMS RELATED TO AUDIT Transparency and accountability Fighting fraud and corruption Compliance with laws Efficiency, effectiveness and economy Quality control of production Ethics

7. 7 ITS NECESSITY AND BENEFITS Whether the entity reaches its objectives and targets, Whether the plans are implemented, Whether the operations and transactions are performed in accordance with rules, Whether the managers and employees use their powers and responsibilities properly,

8. 8 ITS NECESSITY AND BENEFITS-2 To reveal the ageing and failing parts in the functioning of the entity and whether innovations are needed, To identify the preventive and corrective actions to be taken, Whether there is a mistake or setback, To implement the principles of transparency and accountability; to fight fraud and corruption, To ensure the confidence of stakeholders, To protect the entity and employees against pressure and diversions.

9. 9 ACCURATE AUDIT Having no audit is a risk; inaccurate audit is another risk. Audit should be carried out accurately. Accurate audit should be carried out accurately. Accurate audit is useful; inaccurate audit is harmful. Audit should be carried out within the framework of Strategic Management understanding.

10. 10 FEATURES OF ACCURATE AUDIT Audit objective should be clear, Audit system should be reliable and valid, It should be timely, It should be economic, It should be based on the principle of providing guidance.

11. 11 FEATURES OF ACCURATE AUDIT -2 It should be flexible, It should be comprehensible, It should have reasonable criteria, It should be strategic, Exceptions should be identified, It should set forth corrective actions.

12. REQUIREMENTS FOR A SOUND AUDIT EXECUTION The existence of an accurate Audit System, Conducting the audit in accordance with strategic management understanding, The auditor should behave ethically and accurately, Well-defined and clear audit process, Clear, comprehensible and adequate rules, 12

13. REQUIREMENTS FOR A SOUND AUDIT EXECUTION-2 The personnel of the audited entity should believe in the audits usefulness, The existence of a sound communication network between the auditor and the auditee, Paying attention to and valuing the audit findings, Taking the necessary preventive, corrective and formative steps. 13

14. 14 INACCURATE AUDIT AND ITS HARMS Inaccurate audit lacks the features of an accurate audit. Inaccurate audit does not have any benefits, and it causes many harms. All the resources that are spent go to waste, It leads to inaccurate results and inaccurate guidance, It leads to a fear of audit and auditor. Nobody wants the audit.

15. WHY THE AUDIT RESULT IS INCOMPLIANCE To observe deviations in the entitys objective, To observe uncertainty, insufficiency and deterrence in the entitys rules, To detect that the operations and transactions do no comply with rules and objectives, The ineffectiveness of audit, (validity and reliability) Causes deriving from the auditor, Causes deriving from the auditee. 15

16. WHY AUDIT IS DISLIKED Audit often reveals deficiencies and errors, While audit requires compliance with theoretical rules the implementation is based on practice. The inconsistency and gap between theory and practice. Interpretation difference between the auditor and implementer, Implementation deficiencies due to human weaknesses, Lack of accountability culture, The implementers desire to act arbitrarily, Implementer and auditor have different perspectives and justifications for action. 16

17. 17 AUDIT PROCESS 1- Planning stage 2- Implementation stage 3- Reporting stage 4- Monitoring stage

18. 18 ETHICAL RULES FOR AUDITORS There are individual, professional, social and universal ethic rules. There are ethical rules for auditors as well. Here are the ethical rules to be observed by auditors: Reliability (accuracy) Objectivity Professional competency (knowledge, experience, skills) Confidentiality (Keeping institutional information secret) Professional Care and Institutional Awareness Courtesy and Respect

19. 19 QUALIFICATIONS OF AUDIT INSTITUTION Independence, Reliability, Being transparent and accountable, To have technical and professional capacity, To comply with audit ethics, To have quality control system,

20. 20 AUDIT CAPACITY of the AUDIT INSTITUTION The powers and responsibility of the audit institution should be identified, Audit management, Human resource to carry out the audit, Audit standards, Audit manuals, Audit methods, Quality assurance system.

21. 21 CONCLUSION Achieving objectives, being successful, competing and surviving a long time are important for the institution. Obtaining, using and accounting the institutions resources effectively, economically, efficiently and legally, and also taking the necessary measures to prevent the abuse of the institutions resources are important for the institution.

22. 22 CONCLUSION-2 Audit is very important for realizing the institutions objectives. Having no audit is a risk. Performing the audit accurately is a necessity. Inaccurate audit does not have any benefits, and it causes many harms. The correctness of a work in progress is understood only at the end of audit.

23. 23 Afterword Without audit, it is not possible to understand whether an entity is successful. Assoc. Prof. Dr. Recai AKYEL President of the TCA

24. 24 THANKS