International Journal of Government Auditing – October 2004
Botswana
Audit Profile: The Office of the Auditor
General of Botswana
From the colonial period up to 1964, the headquarters of the audit office of what were known as the High Commission Territories (Bechuanaland Protectorate, Basutoland, and Swaziland) was based in Pretoria, South Africa. Each territory had a Senior Auditor. In the case of the Bechuanaland Protectorate, the Senior Auditor was stationed in Mafikeng, the capital. The post of Senior Auditor was later changed to Director of Audit.
The audit office of what was to become the independent country of Botswana was moved from Mafikeng to Gaborone in 1965 before independence. The office continued under a Director of Audit until 1970, when the title of the post was changed to Auditor General (AG).
The office focused primarily on financial audits, which addressed the accuracy, completeness, and timeliness of financial statements. Audit activities were carried out manually, and there was little planning with regard to such issues as the audit approach or the qualifications of the staff needed to be engaged in the audits.
The Office of the Auditor General (OAG) of Botswana has undergone significant changes and improvements since that time. The improvements have included the introduction of an audit manual and auditing standards; the merger with the local audit division; and the introduction of the performance audit division and computers. These have improved the quality and timeliness of the audit work, leading to a more positive outlook on the part of members of the public.
Mandate, Responsibilities, and Independence of the Auditor General
Section 124 of the Constitution of Botswana provides that there shall be an Auditor General and a public audit office. The AG is appointed by an act of Parliament, which is ratified by the President, in accordance with the Constitution and the Finance and Audit Act. The AG is empowered to examine the accounts of all ministries, departments, local authorities, councils, land boards, and parastatals. The Finance and Audit Act was amended to encompass performance auditing in addition to financial auditing.
The AG’s responsibilities are detailed in section 29(1) of the Finance and Audit Act. The AG shall satisfy him/herself that
- all reasonable precautions have been taken to safeguard the collection and custody of public moneys and that the laws, instructions, and directions relating thereto have been duly observed;
- the disbursement of public moneys has taken place under proper authority and for the purposes intended by such authority;
- all reasonable precautions have been taken to safeguard the receipt, custody, issuance, and proper use of public stores and that the instructions and directions relating thereto have been duly observed; and
- adequate instructions or directions exist to guide the officers responsible for the collection, custody, issuance, and disbursement of public stores.
Vision, Values, and Ethics of the OAG
The vision of the OAG of Botswana is to be an independent and proactive SAI that is responsive to the needs and expectations of the nation and keeps abreast of regional and global developments.
The OAG’s values and ethics are as follows:
- Timeliness: Reports will be produced on time.
- Independence, Objectivity, and Impartiality: Auditors will be impartial in both fact and appearance when dealing with auditees. Therefore, conclusions and opinions will be based exclusively on evidence provided.
- Trust, Confidence, and Credibility: The SAI will ensure that its conduct and approach are above suspicion and reproach.
- Integrity: High standards of behavior, such as honesty and candidness, will be maintained.
- Professional Development: Auditors will adhere to professional auditing standards.
- Conflict of Interest: Auditors will be made aware of issues that could jeopardize their independence, such as personal relationships.
- Competence: Auditors will follow international auditing, accounting, and financial management standards.
- Political Neutrality: Actual and perceived political neutrality will be maintained.
Mission Statement
The OAG’s mission is to promote accountability, provide quality audit in the public sector, and assure the nation that public resources are applied to the purposes intended.
Primary Objective
The primary objective of the OAG is to enhance the socioeconomic development of the nation through the promotion of sound financial management and proper accountability for public funds and assets.
Types of Audits Conducted
Financial Audit: The OAG examines the financial statements and expresses an opinion as to whether the accounts show a true and fair view of the financial affairs of the entity. The OAG’ s report is released annually for both the central government and parastatal government audits.
Performance Audit: Performance auditing focuses on the economy, efficiency, and effectiveness with which public resources are being handled and accounted for. The reports are issued upon completion.
Local Government Audits: These audits are conducted for the councils, land boards, and local authorities. The reports are issued upon completion within a particular financial year.
Information Technology (IT) Audits: These are primarily focused on the activities of the IT units within the audited entities. However, they are often used as a complement to the other types of audit.
Special Audits: These emanate from requests by the President, Members of Parliament, or the AG and warrant immediate attention.
Audit Process
The OAG adheres to the following procedures when conducting its audits.
- An engagement letter is issued to the auditee, where applicable.
- A planning memorandum is prepared.
- The planning memorandum is approved by the Assistant Auditor General (AAG).
- An audit program is prepared.
- The audit program is approved by the AAG.
- A pre-audit meeting is conducted.
- The audit is conducted.
- A letter of management is obtained, where applicable.
- A draft management letter is prepared and discussed with the AAG.
- The draft management letter is discussed with the head of department at an exit meeting.
- The management letter is finalized and auditee comments are incorporated.
- The management letter is approved by the AAG.
- The management letter is issued to the auditee.
- Follow-up is carried out.
Organization
The AG, who is independent from the executive, heads the OAG. A Deputy Auditor General (DAG) and four Assistant Auditors General (AAGs) assist the AG. The DAG’s main duty is to coordinate sectional activities through the AAGs and the Under Secretary (US). The US is the head of administration.
The OAG is divided into six operational departments and/or divisions/units:
- The Administration Division handles the OAG’s administration of finance, planning, and accounting.
- The Central Government Division audits all government ministries, departments, and capital projects.
- The Performance Audit Unit conducts value-for-money audits and performance audits on public spending.
- The Parastatal Audit Division audits parastatal organizations.
- The Local Government Audit Division, which has four sections, audits local authorities, councils, and land boards.
- The Special Operations Unit is responsible for audit reports, legislation and auditing standards, information system administration, and information systems audits.
Reporting
Section 124 of the Constitution and Section 29 (1) of the Finance and Audit Act empower the AG to report the results of OAG audits to the National Assembly through the Public Accounts Committee (PAC).
The PAC discusses the reports and makes recommendations for corrective action to the accounting or executive officers of audited organizations. By convention, the government must implement these recommendations. Thus, the reports help the government to exercise accountability. In this manner, the OAG plays a role in strengthening the democratic process and ensuring good governance.
Personnel
The OAG currently has approximately 98 auditors and 41 administrative staff. The auditing staff is made up of officers from varying educational backgrounds. These include certifications from the Association of Chartered Certified Accountants (ACCA) or Chartered Institute of Management Accountants (CIMA), undergraduate and masters degrees, diplomas, and computer specializations.
Challenges
The OAG faces challenges in a number of areas, including the following:
- the lack of skilled manpower, the shortage of computers, and limited funds;
- the lack of proper guidelines and procedures for staff training and development;
- having only one staff person in the newly established Quality Control Office;
- auditing “around” but not “through” the computer; and
- the lack of its own office building.
Future Prospects
The OAG has a strategic plan for 2003-2009 that focuses on two key result areas: accountability to the public sector and organizational effectiveness. The SAI has set goals and objectives with regard to these areas as well as concrete steps on how to achieve them. Specifically, the OAG’s goals are to achieve the following by March 31, 2009:
- provide high quality audit service that conforms to international auditing standards,
- report the performance and delivery of results by the public sector,
- create an audit environment conducive to public accountability in the nation,
- build a human resource capacity to deliver results,
- have processes in place that service the delivery of the core business,
- improve the efficiency and effectiveness of OAG operations, and
- manage contributions from stakeholders.
For additional information, contact: OAG, fax: ++267 58 81 45; e-mail: oag@gov.bw.