By Meresimani Vosawale-Katuba, Director (South Pacific), PASAI
For a SAI to be credible, trustworthy and effective, its audits must comply with applicable standards and its reports must be of a high quality.
INTOSAI is currently revising ISSAI 140 - Quality Control for SAIs, with plans to move towards a holistic and systemic risk-based approach to quality management. [1] The Forum for INTOSAI Professional Pronouncements has developed an Exposure Draft of ISSAI 140 Quality Management for SAIs which is now open for comments. [2]
The changes emphasise that the auditor’s objective is about managing quality and associated procedures in a risk-based and dynamic way in order to achieve the required level of quality, rather than implementing a defined set of quality control procedures.
The SoAQM pilot initiative
The INTOSAI Development Initiative (IDI) has developed the System of Audit Quality Management (SoAQM) pilot. In this system, the SAI designs and implements at the organisational level to enable it to conduct high quality audits, fulfil its responsibilities in accordance with professional standards and applicable legal and regulatory requirements, and contribute value.
There is a proposed collaboration between us and IDI to support interested SAIs in our region in this initiative, for which we held an awareness session with SAI heads.
We recently facilitated a workshop to assist SAIs in sustainably planning, executing and reporting on their financial statements of government (FSG) audits in accordance with international standards. [3] This training was the final stage of a programme of capability-building support to conduct FSG audits in accordance with the International Standards of Supreme Audit Institutions (ISSAIs). We started this programme in 2020 in collaboration with IDI.
Quality assurance reviews were carried out by independent reviewers for the participating SAIs' completed FSG audits. The workshop focused on the quality assurance review findings and provided some practical, immediate and long-term solutions for audit teams to implement in future financial audits.
It was also an opportunity for participants to share the challenges faced in audit methodology and processes, and implementing audit quality controls. They could also gain insights from their peers in other SAIs on suggested solutions.
Following these learnings, we introduced participants to the SoAQM pilot initiative to create awareness on the proposed changes to the audit quality management process for SAIs and also to assist them in planning their future activities on audit quality management.
The future of audit quality control
It is proposed that the new ISSAI 140 take effect one year after the endorsement by the INTOSAI Governing Board. The effective date for the revised ISSAI 140 is estimated to be 1 January 2025.
The effective date will be important for SAIs that wish to be able to state that an audit has been carried out in accordance with the ISSAIs. From the effective date such claims can only be made if the SAI fully complies with the requirements of ISSAI 140. [4] In light of this, we are working with our member SAIs to begin shifting our perspectives towards managing quality in a risk-based and workable way.
References
[1] The System of Audit Quality Management: Pilots for SAIs
[2] Revision of ISSAI 140 – Quality management for SAIs
[3] Twenty-one Pacific Island government audit office staff in Fiji for improved financial auditing
[4] Explanatory memorandum professional pronouncement on quality management for SAIs and related revision of ISSAI 100 – fundamental principles of public sector auditing
