1. Eastern African Association of Public Accounts Committees (EAAPAC) & Southern African Development Community Organisation of Public Accounts Committees (SADCOPAC) How to use Audit Reports to oversee Public Procurements John F. S. Muwanga Auditor General-Uganda Kampala, 7 May 2013

2. LEGAL MANDATE OF OAG The Mandate of the Auditor General (AG) The Constitution of Uganda - Article 163 ~ audit and report to Parliament on the public accounts of Uganda. The National Audit Act (NAA) 2008, ~ section 21- conduct value for money audits of all projects involving public funds. ~ under section 13(e)- shall undertake procurement audits.

3. Objectives of the Procurement Audits Ensure the Application of; ◦ fair, ◦ competitive, ◦ transparent, ◦ non-discriminatory ◦ value for Money procurement and disposal standards and practices are followed

4. Procurement procedures undertaken OAG Inquire whether there has been a procurement audit by PPDA. Obtain the report and review its scope, methodology and where possible the qualifications of the auditor before relying on it. Review audit issues raised and action taken by management to address them Extract issues raised and not addressed and report on them For complex procurement request for procurement expert

5. Procurement procedures for sample selected ProcedureRisks (What can go wrong) Review the entity budgets and reconcile it with the procurement plans Deliberate failure to plan for procurement leading to emergency requirements- Procurement planning is a mandatory requirement under Section 58 of the PPDA Act Ensure appropriate documents are kept as required by the procurement laws and procedures False documentation and Statements Our experience is that there is still a big problem with record keeping and this is a very prone area procurement corruption. Review for repetitive transactions in a year and confirm whether their procurement followed the procurement procedures Splitting of procurements

6. Procurement procedures cont… Confirm whether the value of the procurements followed the PPDA threshold The procurement guidelines provides thresholds as a basis for choice of procurement methods. The higher the value the more competitive methods of procurement that should be used. Rigged Specifications, terms of reference Review the procedures for bid issuance and receipts to ensure compliance Bid Rigging – this may happen even after bid submission Review the contract awards patterns and review any circumstances that may indicate bid collusion Bidders collusion in bidding instead of competing Under the PPDA regulations – Bidders are required to adhere to the ethical code For high value procurements, check whether post evaluation reviews were made to confirm previous works done (due diligence) Brief case providers – unreliable Eligibility requirements if adhered and due diligence could minimise this

7. Procurement procedures cont… Check whether each procurements had a different evaluation committee and properly instituted. One Evaluation Team for all procurements Ensure that sourcing of the procurement follow the PPDA guidelines Unjustified single Source Awards or direct procurements The PPDA regulations provides guidance on where direct procurement is applicable Review the reasonableness of evidence for contract evaluation Rigged contract amendments and variations Review the code of ethics were signed as required and inquire whether there are circumstances they may have indicated conflict of interest Conflicts of Interest Confirm evidence that support the claims and re-compute the payments taking into account all deductions False payments and claims

8. Real time procurement procedures Use of the procurement plans to follow up procurements timely as they occur Using a risk assessment, the Auditor General may appoint a person to seat on the procurement committees as an ex- official to observe the procurement processes and make an opinion thereafter.

9. Post Procurement Audit actions ◦ The Auditor General may request the Accounting Officers to prepare Action plans for implementation of the audit recommendations.