Presentation on theme: "PRE-AUDIT/POST AUDIT PRESENTATION"— Presentation transcript:
1 PRE-AUDIT/POST AUDIT PRESENTATION Charles BarugahareDirector Internal Audit
2 PRESENTATION OUTLINE Definitions and back ground of Pre/Post Auditing Merits and Demerits of pre and post AuditingRisk assessment in MUKPre- Auditing in Makerere UniversityPost -Auditing in Makerere UniversityAuditing in the college systemWay forward 1st July 2011 and beyondConclusionQuestions/Comments
3 Definition/Back ground to Auditing Internal auditing (IA) is an independent objective assurance and consulting activity designed to add value and improve organization’s operations (iia definition)Independence & objectivity aspects are very criticalConsulting refers to furnishing Council, Mgt and staff with analysis, appraisals, recommendations and capacity building aspectsAdd value & improving operations coversrecommending use of best practices,identification of new risks/new required controlsBeing able to handle emerging business issues
4 Definition & background of IA Cont’d IA is aimed at evaluating and improving the effectiveness of;Risk management,controls,and governance processes
5 Definitions cont’dPre -Auditing –refers to an examination of documents supporting a transaction or a series of transactions before they are paid for and recorded.Post- Auditing refers to the review of documents or a series of transactions after the transaction has been recorded or consummated.
6 Rational for pre- Audit Rising incidents of illegal, irregular, wasteful and anonymous disbursements of public fundsMarked inadequacies in internal controlsCase for Selective pre -auditingNot all transactions are subject to pre-auditing –only transactions or areas considered to have issues above.
7 Rational for post audit Able to review more areas than under pre- auditPossible to assess the organisation's resources and ensure that all resources (human,material, and financial) are utilised appropriately so that the best possible results are achieved;Able to produce meaningful reports for mgt & Council attentionAble to verify the reliability and suitability of the information systems;Able to ascertain compliance to policies, laws independentlyAble to inform the management of any irregularity or anomaly revealed and to recommend appropriate measures for their elimination;Able to Follow-up on whether the recommendations by the internal auditors/external Auditors have been implemented.
8 Merits/Demerits of Pre/post audit Looks at transactionsSome transactions are impractical to pre-auditErrors are identified & corrected before transactionNarrow scopeGenerally limited or no reportsAuditors are part of operationsTraditional practiceLooks at risks, processes, controlsIts practical to audit for all activities or risky onesErrors are identified after payment/transactionWider scopeGenerally reports producedAuditors independent of operationsRecommended best practice
9 PRE- AUDITING IN MUK The key areas currently pre-audited are; Verification of all deliveriesReviewing all payment vouchersVerification of all pay change reportsReviewing all accountabilitiesCertifying certain project reports
10 Verification of deliveries Must audit verify all deliveries or critical deliveries?If some, who verifies the rest?How do we select those to be verified by Audit and those by the rest?How do we monitor that those verified by others are actually verified?
11 Verification Cont’dThe Answer to 1 is NO, only critical deliveries require to be verifiedCritical deliveries can be determined by amount or nature of delivery-Nature – All capital items continue to be verified by AuditAmount – All transactions above 2million ( micro procurements)In the Colleges- The transactions below 2M, the person responsible for administration receives the items and be verified by Accountant- Reporting.For Administration Units ???Audit to review on an going basis stores records and reportsAudit to be represented in opening all procurement bids above 30M
12 Other pre-audit aspects in the schedule See details in the schedule
13 Post auditing in MUKThe audit structure, staffing and positioning were all planned for a post audit set upCouncil has pronounced itself post auditingThe risk assessment and the demands from mgt, Audit committee and stakeholders are driving the post audit approach.
14 Current post audit situation About 70% pre- Audit and 30% post audit.No comprehensive risk assessment, Audit areas selected judgementally or using rough assessmentsLimited skills and knowledge in most staffLimited computer skills
15 Post Audit cont’d Limited access to computerized systems Limited guidelinesLimited exposure by most staff on Audit program set up, identifying and documenting audit evidence, report writing etc.
16 Post audit -Going forward Staffing with technical/practical skills improvedStrategize to give more attention to post auditDocumentation and marketing post auditingRefer assessment done by the Committee
17 Auditing in the college System Auditing will remain a central activity in the universityPost auditing largely influenced this decision.More in the pre- template
18 EndQuestions, comments & remarks!!!!!!! Thank you