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INTOSAI	International Journal Of Government Auditing: 
					
July 2010: 
Volume 37, No. 3: 

Board of Editors: 
Josef Moser, President, Rechnungshof, Austria: 
Sheila Fraser, Auditor General, Canada: 
Faiza Kefi, First President, Cour des Comptes, Tunisia: 
Gene Dodaro, Acting Comptroller General, United States of America: 
Clodosbaldo Russian Uzcategui, Comptroller General, Venezuela: 

President: Helen H. Hsing (U.S.A.): 

Editor: Muriel Forster (U.S.A.): 

Assistant Editor: Linda J. Sellevaag (U.S.A.): 

Associate Editors: 
Office of the Auditor General (Canada): 
Sudha Krishnan (ASOSAI-India): 
Luseane Sikalu (PASAI-Tonga): 
CAROSAI Secretariat (St. Lucia): 
EUROSAI General Secretariat (Spain): 
Khemais Hosni (Tunisia): 
Yadira Espinoza Moreno (Venezuela): 
INTOSAI General Secretariat (Austria): 
U.S. Government Accountability Office (U.S.A.): 

Administration: 
Sebrina Chase (U.S.A.): 
Paul Miller (U.S.A.): 

Members of the Governing Board of INTOSAI: 
Juan M. Portal-Martinez, Auditor General Auditoria Superior de la 
Federation, Mexico, Chairman: 
Terence Nombembe, Auditor-General Office of the Auditor-General South 
Africa, First Vice-Chairman: 
Osama Jaffer Facieeh, President, General Auditing Bureau, Saudi 
Arabia, Second Vice-Chairman: 
Josef Moser, President; Rechnungshof; Austria, Secretary General: 
Liu Jiayi, Auditor General National Audit Office, People's Republic of 
China: 
Paul R.S. Allsworth, Director of Audit, Cook Islands Audit Office: 
Ziriyo Bogui, President, Chambre des Comptes, Cote d'Ivoire: 
Pal Csapodi, Acting President; Allami Sztimvevoszik, Hungary: 
Vinod Rai, Comptroller and Auditor General, India: 
Hwang Sik Kim, Chairman, Board of Audit and Inspection, Korea: 
Ali Al-Hesnawi, Auditor General, General People's Committee of 
Institution for Auditing and Technical Supervision, Libyan Arab 
Jamahiriya: 
Luis A. Montenegro Espinoza, President, Consejo Superior de la 
Contraloria General Nicaragua: 
Jurgen Kosmo, Auditor General, Riksrevisjonen, Norway: 
Sergey Vadimovich Stepashin, Chairman, Accounts Chamber, Russian 
Federation: 
Wesley Galloway, Acting Director of Audit, National Audit Office, St. 
Kitts and Nevis: 
Amyas Morse, Comptroller and Auditor, General National Audit Office, 
United Kingdom: 
Gene Dodaro, Acting Comptroller General, Government Accountability 
Office, United States of America: 
Clodosbaldo Russian Uzcategui, Comptroller General Venezuela: 

The International Journal of Government Auditing is published 
quarterly (January, April, July, October) in Arabic, English, French, 
German, and Spanish on behalf of INTOSAI (International Organization 
of Supreme Audit Institutions). The Journal, which is the official 
organ of INTOSAI, is dedicated to the advancement of government 
auditing procedures and techniques. Opinions and beliefs expressed are 
those of editors or individual contributors and do not necessarily 
reflect the views or policies of the organization. 

The editors invite submissions of articles, special reports, and news 
items, which should be sent to the editorial offices at: 

U.S. Government Accountability Office: 
Room 7814, 441 G Street, NW: 
Washington, D.C. 20548: 
U.S.A. 
(phone: 202-512-4707; fax: 202-512-4021; 
e-mail: intosaijournal@gao.gov) 

Given the Journal's use as a teaching tool, articles most likely to be 
accepted are those that deal with pragmatic aspects of public sector 
auditing. These include case studies, ideas on new audit 
methodologies, or details on audit training programs. Articles that 
deal primarily with theory would not be appropriate. 

The Journal is distributed to INTOSAI members and other interested 
parties at no cost. It is also available electronically at 
http://www.intosaijournal.org or http://wwwintosa.org and by 
contacting the Journal at spel@gao.gov. 

Articles in the Journal are indexed in the Accountants' Index 
published by the American Institute of Certified Public Accountants
and included in Management Contents. Selected articles are included in 
abstracts published by Anbar Management Services, Wembley, England, 
and University Microfilms International, Ann Arbor, Michigan, U.S.A. 

Contents: 

Editorial: 

News in Brief: 

Alleged Fraud Involving Millions of Euros: Why Didn't We Notice? 

ASOSAI Assembly Report: 

CAROSAI Congress Report: 

Spotlight on the Strategic Plan: 

Inside INTOSAI: 

IDI Update: 

INTOSAI Calendar: 

[End of section] 

Editorial: 

Auditing: An Immune System to Protect Society and the Economy: 

Liu Jiayi, Auditor Generate National Audit Office of the People's 
Republic of China: 

[Photograph: Liu Jiayi] 

In China, audit is considered an indispensable part of the national 
political system. It is a product of, and a means of promoting, 
democracy and the rule of law. It is also an important tool for 
upholding the security of the national economy. It functions like an 
immune system for the economy and society. The body's immune system 
recognizes foreign and abnormal cells and destroys them. In the same 
way, audits reveal existing problems, proactively prevent others, and 
promote resistance throughout the entire system of government by 
ensuring that taxpayers' monies are managed and spent properly. On 
behalf of the general public and in accordance with the law, auditors
(1) monitor the performance of various levels of government and their 
respective departments, along with other organizations that have 
access to taxpayer money, and (2) report audit results to the general 
public. During this process, auditors detect wrongdoing and make 
corrective recommendations, investigate and deal with serious 
violations, promote efforts to combat corruption, and safeguard the 
orderly operation of the economy. They also reveal institutional 
problems and systematic deficiencies, promote reasonable deployment 
and efficient utilization of public resources, ensure effective 
implementation of important government economic policies and measures, 
and safeguard national economic security. 

The National Audit Office of the People's Republic of China (CNAO) has 
more than 20 years' experience and has also learned from and drawn on 
the experience of other countries. Based on tangible conditions in 
China, the CNAO has set up an audit system with Chinese 
characteristics. 

* The fundamental goal of audit in China is to safeguard the vital 
interests of the general public. At this time, the intent and purpose 
of audit can be defined as promoting the rule of law, upholding the 
people's livelihood, promoting reform, and stimulating development. 
The primary and utmost task of auditing is upholding national 
security, which is carried out by promoting national economic 
security, safeguarding national interests, giving impetus to democracy 
and the rule of law, and carrying sustainable development forward in a 
coordinated way. The basic guideline is "conducting audits on the 
basis of law, serving the overall public interest, giving priority to 
key issues of government and public concern, seeking truth, and being 
realistic and pragmatic." 

* A legal mandate for audit has been established based on the 
constitution, consisting of the Audit Law and its implementation and 
supported by audit standards. 

* A framework for audit work has been set up, comprising audits of 
public finance, financial institutions, state-owned enterprises, 
accountability, the environment, and foreign issues. 

* The CNAO has established a preliminary comprehensive audit pattern 
with Chinese characteristics. Based on financial audit, with a focus 
on performance and accountability, our audits integrate compliance and 
performance audits; focus on disclosing, investigating, and dealing 
with serious violations and evidence of economic crimes; identify 
institutional obstacles and systematic deficiencies; and propose 
relevant reforms and improvements. 

* The CNAO has expended significant efforts to explore information 
technology auditing and shift from traditional to modern audit 
approaches. As a result, we have enhanced the quality, efficiency, 
internal controls, and management level of our audits. 

In accordance with these guidelines, the CNAO has been actively 
addressing the international financial crisis since 2008 while at the 
same time responding to the government's key task of ensuring stable 
and rapid economic growth, making every effort to track the flow of 
public funds. We have concentrated on real time audits covering the 
life cycle of projects such as (1) the relief, rehabilitation, and
reconstruction in Wenchuan and Yushu, which were stuck by two serious 
earthquakes, (2) the Beijing Olympics, and (3) the implementation of 
policies and measures to address the financial crisis. These efforts 
have brought into play the "immune system" function of audit for 
ensuring the healthy operation of society and the economy. As China 
emerges from the financial crisis, it still faces the challenge of 
maintaining stable and rapid economic growth and speeding up the 
transition of economic development modes. In accordance with the 
provisions of law, Chinese audit institutions are focusing their 
attention on the government's performance of this central task. The 
audit institutions are strengthening their audits to protect the 
livelihood of the people and sound economic growth with a view to 
effectively implementing the government's proactive financial and 
monetary policies. By doing so, government audit in China will play a 
positive role in achieving China's macro-policies for sustaining 
economic growth, ensuring its people's well-being, and maintaining 
social stability. 

[End of section] 

New in Brief: 

Australia: 

Award from the Government of Indonesia: 

In February 2010, His Excellency Primo Alui Joelianto, the Indonesian 
Ambassador to Australia, awarded the Indonesian First Class Medal of 
Honor to Ian McPhee, the Auditor-General of Australia. The award 
recognised the contributions of Mr. McPhee and the Australian National 
Audit Office (ANAO) in promoting the transparency and accountability 
of public finance for the government of Indonesia. In particular, the 
award cited contributions to the audit of natural-disaster management 
in Aceh and Nias and to best practices and capacity building in 
auditing. 

The ANAO has been contributing to capacity building with the 
Indonesian Board of Audit (BPK) over the past 4 years. The ANAO's 
activities have been focused on both performance and financial 
auditing, included a series of long-term secondees from the BPK and 
the delivery of Jakarta-based training and pilot audit workshops. 

In accepting the award, Mr, McPhee expressed appreciation for the 
honor the Indonesian government had bestowed on him and his office and
acknowledged the important work of colleagues within both the ANAO and 
the BPK who had made the relationship a success. 

[Photograph: Presentation of First Class Medal of Honor to Ian McPhee, 
the Auditor-General of Australia (left), by His Excellency Primo Alui 
Joelianto, the Indonesian Ambassador] 

The ANAO's contribution to the BPK has been strongly supported by 
AusAID, the Australian government's overseas aid program, and the 
Department of Foreign Affairs and Trade. 

For additional information, contact the ANAO: 

E-mail: iagl@anao.gov.au: 
Web site: www.anao.gov.au: 

Azerbaijan: 

Book on SAIs and International Audit Organizations Published: 

The Chamber of Accounts of the Republic of Azerbaijan has published a 
book entitled Supreme Audit Institutions and Their International 
Organizations to inform the public about the roles and 
responsibilities of supreme audit institutions. 

[Photograph: Azerbaijani book, Supreme Audit Institutions and Their 
International Organizations] 

The book provides information on the SAIs of United Nations member 
states, as well as insight into the objectives, responsibilities and 
activities of INTOSAI and its regional working groups. The book also 
mentions other international organizations of which the Azerbaijani 
Chamber of Accounts is a member. 

Currently, work is under way to draft an expanded version of the book 
in English and Azerbaijani with more detailed information on SAIs. 

For additional information, contact the Chamber of Accounts: 

E-mail: office@ach.gov.az: 
Web site: www.ach.gov.az: 

Brazil: 

Court of Audit Begins Preparations for the 2014 World Cup: 

In May 2010, the Brazilian Court of Audit (TCU) presented the audit 
model that will be used to oversee expenditures related to 
preparations for the 2014 World Cup. Representatives of the TCU signed 
a protocol with state and municipal courts of audit in regions that 
will host the games. The agreement defines each agency's role and 
provides for information-sharing to strengthen oversight of the 
government investments needed to prepare to host the championship. 

TCU President Ubiratan Aguiar expressed satisfaction at the integrated 
planning of the audit courts' oversight and stressed the important 
educational aspect of this oversight. "We must invest in preventive 
measures to avoid the misappropriation of public funds. The success of 
the 2014 World Cup depends upon the commitment of the federal 
government and the Federal District, in addition to the states
and municipalities that will host the games. Only with the 
implementation of proposed improvements to the World Cup host cities 
can the country achieve the success that we all desire." Mr. Aguiar 
also emphasized that investments need to be made in both the 
construction or renovation of stadiums and improvements to urban 
infrastructure. He stated, "Regardless of who is responsible for 
carrying out the specific projects, the Brazilian people will pay the 
bill. It is unacceptable that society pay for something from which it 
will not benefit." 

Valmir Campelo, the TCU minister reporting on the World Cup
audits, presented the Web site that has been created to monitor
preparations for this international event [hyperlink, 
http://www.fiscalizacopa2014.gov.br]. Mr. Campelo noted that the time 
remaining before 2014 is short in view of the quantity and complexity 
of the tasks the implementing agencies need to undertake. 

Other government leaders participating in the ceremony included the 
Minister of Planning, Budget and Management; the Minister of Sports; 
the Comptroller General; the Attorney General of the Republic; and 
congresspersons, governors, and mayors. 

For additional information, contact the TCU: 

E-mail: arint@tcu.gov.br: 
Web site: www.tcu.gov.br: 

China: 

CNAO Hosts the First SinoIndian Young Auditors Forum: 

From May 11-17, 2010, the National Audit Office of the People's 
Republic of China (CNAO) hosted the first SinoIndian Young Auditors 
Forum in Beijing. A total of 24 participants attended, 12 from China 
and 10 from India. 

The forum is a mechanism for bilateral communication initiated by the 
heads of the Chinese and Indian SAIs to strengthen exchange and 
cooperation between the young auditors in their offices. On May 11, 
Liu Jiayi, Auditor General of the CNAO, met with the Indian 
delegation, which was headed by Madhavi Patchilla, the Senior Deputy 
Accountant General of the Office of the Comptroller and Auditor 
General of India. At that time, Mr. Liu observed that the youth are 
the future of the nation and that Chinese and Indian youth could 
strengthen exchanges and cooperation through this forum to promote the 
development of the auditing profession and deepen relationships 
between the two countries. 

[Photograph: Participants in the first Sino-Indian Young Auditors 
Forum in Beijing in May 2010] 

During the 2-day forum, the Chinese and Indian delegates presented 
country papers and actively discussed two themes: how to become a 
qualified government auditor and the role of the SAI in promoting 
government accountability. 

During the forum, the participants also planted trees together, which 
symbolized the lasting friendship between China and India. A bowling 
match was held, and the delegates visited the Great Wall, Forbidden 
City, and Olympic Park in Beijing and the World Expo in Shanghai.
Both sides agreed that the forum provides a platform to share auditing 
ideas and experiences and learn from each other. These activities 
effectively promote bilateral exchanges between the young auditors of 
the two SAIs, thus enhancing mutual understanding and friendship. 

For additional information, please contact the CNAO: 

E-mail: cnao@audit.gov.cn: 
Web site: www.cnao.gov.cn: 

Georgia: 

New Audit Law and Role for the Chamber of Control: 

In January 2009, the new law on the Chamber of Control of Georgia 
(CCG) was enacted. It defined a new role for the CCG as an auditor-
consultant overseeing the use of state funds and state property with a 
material value. With the new law, the CCG changed its organizational 
structure and responsibilities. Levan Bezhashvili, the Chairman of the 
CCG since July 2008, is playing a leading role in modernizing the 
structure of the Georgian public audit sector and strengthening its 
organizational capacity by establishing a sustainable development 
system. 

Mr. Bezhashvili was elected Chairman of the CCG by the unanimous 
decision of Parliament for a 5-year term. He has expressed his 
commitment to developing the CCG during its transitional period and 
improving control systems in the Georgian public sector. 

[Photograph: Levan Bezhashvili] 

Mr. Bezhashvili has had broad experience in supreme legislative 
bodies. Before his appointment as CCG Chairman, he held a variety of 
governmental positions, including Governor (State Envoy of the 
President of Georgia) of Kakheti Region. From 2004 to 2008, he was a 
Member of Parliament, serving as the Chairman of the Legal Issues 
Committee. He also held the posts as the Deputy Minister of Justice 
and the head of the Legal Department of the Georgian Parliament. 

For additional information, contact the CCG: 

E-mail: iroffice@control.ge, thecontrolge@control.ge: 
Web site: http://www.control.ge: 

Kuwait: 

Awareness Campaign Focuses on Audit Guidelines: 

From January to April 2010, the State Audit Bureau of Kuwait
(SAB) organized an awareness campaign whose motto was "Precise 
Performance with Audit Guidelines." During the campaign, a number of 
activities were organized to highlight the role of professional 
guidelines issued by international, regional, and Arab audit 
organizations. 

Through educational symposiums and workshops, the campaign drew 
attention to the importance of using guidelines as a framework to guide
the audit work and as tools to organize SAB procedures and help the 
SAB achieve its goals. 

For additional information, contact the SAB: 

E-mail: undersecretary@sabq8.org: 
Web site: www.sabq8.org: 

Lithuania: 

New Auditor General of the National Audit Office: 

In April 2010, the Lithuanian Parliament appointed Giedre Svediene to 
a 5-year term as Auditor General of the Republic of Lithuania on the 
recommendation of the President of the Republic. 

Ms. Svediene graduated from Vilnius University with an economist-
analyst diploma. She continued her studies at the Central European 
University in Prague, where she obtained a master's degree in 
economics, and in Milan, where she obtained a master's degree in 
banking and finance. 

[Photograph: Giedre Svediene] 

Ms. Svediene has had an extensive career in the public sector. She 
worked at the Permanent Representation of Lithuania to the European 
Union in Brussels, the Ministry of Finance, and the Ministry of the 
Interior. 

For additional information, please contact the National Audit Office 
of Lithuania: 

E-mail: nao@vkontrole.lt: 
Web site: www.vkontrole.lt/en/: 

Poland: 

SAI Bids Farewell to Its Former President: 

On April 10, 2010, the plane carrying Lech Kaczynski, President of the 
Republic of Poland and former President of the NIK, crashed while 
trying to land at an airport near Smolensk, Russia. Mr. Kaczynski's 
wife and 94 other top officials, including members of Parliament and 
top military officials, were also killed in the crash. 

[Photograph: Lech Kaczynski] 

Lech Kaczynski was the President of the Polish SAI (NIK) from 1992 
through 1995. During his term of service, he significantly increased 
public trust in the NIK and enhanced its role as an efficient state 
audit body. 

In 2000, Mr. Kaczynski was appointed Minister of Justice, and 2 years 
later he was elected Mayor of Warsaw. In December 2005, he assumed 
office as the President of the Republic of Poland. 

For additional information, contact the NIK: 

E-mail: wsm@nik.gov.pl: 
Web site: www.nik.gov.pl: 

Romania: 

Recent Developments at the Romanian Court of Accounts: 

The Romanian Court of Accounts (RCA) has new collegiate leadership 
modeled on a modern European Union (EU) approach. The new leadership's 
mandate started in November 2008. During 2009, many RCA activities 
were significantly improved and a comprehensive process to 
continuously update those activities was begun. 

* A new Web site was created to present basic information on the RCA 
in both Romanian and English. 

* A new strategic plan for 20102014 has been drafted, is being 
reviewed, and will be continuously updated. Its main strategic 
objectives include the following: 

- The impact of RCA's control and audit activity will be maximized. 

- RCA's reputation will be improved and the authority of and respect 
for the organization will increase in response to the high-quality 
results it achieves. 

- RCA's reports will be relevant, realistic, clear, credible, timely, 
and useful. They will be duly drafted and made available to 
stakeholders. The Parliament will be able to make legislative 
decisions based on their conclusions and recommendations. 

- Available resources will be used with greater efficiency. 

- Intra- and inter-institutional communication will be improved, 
creating a positive impression of the RCA's image and credibility. 

- The professionalism of specialized RCA staff will have a decisive 
effect on the quality of RCA's activities. 

- In its capacity as an SAI, RCA will function in accordance with 
INTOSAI professional standards and will safeguard Romanian and EU 
financial interests. 

Strategic measures and specific actions have been detailed for each 
objective. The strategic objectives will be updated as necessary by 
carefully monitoring emerging risks factors. 

* RCA's standards are being updated, with an emphasis on implementing 
good practice in the management of audit quality. 

* RCA's Code of Ethics is also being updated to ensure auditors' 
independence, objectivity, and integrity within the audit work 
performed. 

For additional information, contact the RCA: 

E-mail: rei@rcc.ro: 
Web site: www.curteadeconturi.ro: 

Sweden: 

New Auditor General: 

The Swedish Parliament has appointed Gudrun Antemar as a new Auditor 
General for the Swedish National Audit Office for a term of 7 years, 
effective July 1, 2010. The Swedish SAI is headed by three Auditors 
General. Ms. Antemar joins Claes Norgren and Jan Landahl, who continue 
in their respective positions as Auditors General. 

[Photograph: Gudrun Antemar] 

Ms. Antemar has a masters degree in law from Stockholm University and 
previously served 6 years as Director General at the Swedish Economic 
Crime Authority. She also served for 4 years as Director and Chief 
Legal Officer at the Office of the Prosecutor-General and as a
judge at the Stockholm District Court. Before that, she served 7 years 
as a Deputy Director and Legal Adviser at the Ministry of Justice. In 
addition Ms. Antemar has been a trade union representative. 

For additional information, please contact the Swedish National Audit 
Office: 

E-mail: int@riksrevisionen.se: 
Web site: www.fiksrevisionen.se: 

Switzerland: 

Federal Audit Office Publishes Annual Report for 2009: 

The Swiss Federal Audit Office (SFAO) is the supreme audit authority for
the Swiss Confederation and reports annually to Parliament and the 
Federal Council on the extent and focus of
its audit activities and on important findings. The SFAO audits all 
levels of budget implementation, and its audit activities support the 
Parliament in its overall supervision and the Federal Council in its 
supervision of the administration. The 2009 annual report gives an 
overview of the audit activities and their results for the past year. 
It can be found at www.efk.admin.ch and is available in English for 
the first time. The Web site contains reports on several evaluations, 
including sideline jobs held by university professors, cost 
development in motorway tunnel construction, energy research, and the 
authorization procedure and costs in animal testing. 

For 2009, the SFAO conducted various financial supervisions and annual 
audits resulting in written reports. The introduction of the Swiss 
Confederation's New Accounting Model led to a fundamental change in 
financial management of the federal administration. The SFAO found 
that although administrative units were generally successful in adopting
the changes, the new principles of accounting, internal cost 
allocation, and internal control systems were not always applied 
correctly. The SFAO will continue to help consolidate the New 
Accounting Model. The SFAO's recommendations are not intended to 
encourage excessive bureaucracy but rather to help balance costs and 
benefits. With regard to purchasing goods and services, the SFAO 
repeatedly insisted that procurement legislation directives be 
observed and orders be awarded based on a competitive tender process. 
Finally, regarding fiscal equalization within the cantons, the SFAO 
noted improvements in the quality of data for equalizing resources and 
compensating burdens. 

In addition to financial supervision, the SFAO carries out a number of 
annual audit assignments and acts as the statutory auditor for social 
institutions of the Confederation, various public institutions and 
foundations, and international organizations. 

For additional information, contact the SFAO: 

E-mail: info@efk.admin.ch: 
Web site: www.sfao.admin.ch: 

[End of section] 

Alleged Fraud Involving Millions of Euros: Why Didn't We Notice? 

by: Freddy Dezeure and Gregory Van Caenegem (DG INFSO, European 
Commission) and Dominique Bernadaux, Mattia Ferrara, and Kjell Larsson 
(OLAF, European Anti-Fraud Office): 

Editor's note: 
This article expresses the personal views of the authors and in no way 
constitutes a formal/official position of the European Commission. 

Toward the end of 2007, allegations of fraud[Footnote 1] were made 
involving millions of euros spent to carry out research projects 
funded by the European Union (EU). This alleged fraud had apparently 
gone on for a number of years and had been previously undetected. 

This article describes the factors that may have allowed this alleged 
fraud to occur and the actions that have been taken to address it and 
prevent its future recurrence. While the alleged fraud in this case 
occurred in the context of audits of research grants—a rather common 
public sector role—we believe that the lessons learned can be applied 
in many other areas in the public sector, such as grants and subsidies 
or the procurement of infrastructure, goods, or services. 

Background: 

The European Commission is the executive arm of the EU. DG INFSO, one 
of the Commission's departments, provides EU grants to information 
technology research projects by cofunding the costs incurred. DG INFSO 
manages 5,000 projects, and its 15,000 beneficiaries invest more than 
1 billion euros per year. DG INFSO carries out 200 annual financial 
audits on these projects, and the audit results contribute to the 
annual assurance process. 

OLAF, the European Anti-Fraud Office, conducts administrative 
antifraud investigations to protect the EU budget. Although 
statutorily part of the European Commission, OLAF is operationally 
independent as far as its investigations are concerned. It can carry 
out controls with the help of Member State authorities and, in some 
cases, with powers similar to national administrative authorities. In 
its investigations, OLAF cooperates with European Commission 
departments and national authorities and helps the Commission prevent 
fraud. 

How Did It Start? 

At the end of 2007, OLAF contacted DG INFSO to discuss allegations 
that several entities had claimed substantial but fictitious costs in 
EU-funded research projects. A highly disturbing detail was that some 
of these entities had received clean audit reports in the recent past. 

As DG INFSO and OLAF analyzed the projects and entities in question, 
we determined that to confirm or dismiss these allegations we needed 
radically new cooperation mechanisms between our two departments to 
synchronize audits and investigations. 

A first step was to ensure that we were using the most modern auditing 
methods, drawing on the new standards issued by the International 
Auditing and Assurance Standards Board adapted to the public sector 
context by INTOSAI, and carefully tailoring them to the particular 
situation. 

We also realized that we needed to get insight and drill into vast 
amounts of data (thousands of legal entities, contracts, transactions, 
people, addresses, and e-mails). To do that, the advanced data-mining 
tools that OLAF used were adapted to DG INFSO's audit environment. 
This resulted in excellent synergies between audits and 
investigations, though we were always careful to bear in mind and 
respect the different roles and mandates of audit and investigation. 

The information gathered seemed to confirm that a complex fraud scheme 
had been discovered that might have gone unnoticed over many years. 
The alleged fraud was conservatively estimated at millions of euros. 
The alleged fraud scheme we identified gave both auditors and 
investigators new insights about the strengths and weaknesses of their 
respective methods and the importance of an effective cooperation 
between the two professions. 

Let us share some of these lessons learned from an auditor's point of 
view. 

How Could This Go Unnoticed? 

We are convinced that the alleged perpetrators of the fraud had in-
depth knowledge of the EU's control systems and were constantly 
adapting their behavior as the controls evolved. Loopholes or 
weaknesses in the regulations were exploited, and misrepresentations 
were used to an extent that none of us had seen before. The modus 
operandi included the following: 

* Fictitious documents that look formally correct but were completely 
fabricated were produced to comply with controls. 

* Shell companies were set up in remote and uncooperative (tax-haven) 
places, using fake Web sites, hypothetical activities, and clients 
involved in other offshore entities. 

* Fictitious staff with fabricated curricula vitae were listed. E-
mails between these fictitious staff were generated to make it appear 
that they had worked on the projects. 

* Names of real companies and real people were used without their 
consent to unduly benefit from their established reputations. 

* Contracts, invoices, and accounting transactions were massively 
falsified or coded using fake descriptions. 

* Intercompany subcontracting, cross-payments, and back-payments were 
used to circumvent controls. 

EU services were not prepared for the complexity of this fraud scheme 
and its massive use of misrepresentation. Also, the auditors used 
traditional audit approaches with standard audit programs that were 
simply bound to fail in this case. Furthermore, audits were conducted 
as separate assignments, without links between them. 

A key weakness of the existing control processes was undoubtedly the 
lack of healthy professional skepticism in planning and carrying out 
audits. Fraud was considered as a scope exception in the auditors' 
opinion rather than an integral part of the scope, as specified in 
International Standard on Auditing (ISA) 240 "The Auditor's 
Responsibilities Relating to Fraud in an Audit of Financial 
Statements," and International Standard of Supreme Audit Institutions 
(ISSAI) 1240. 

Why Could This Fraud Be Addressed Now? 

The shock of large-scale fraud in entities with a clean audit opinion 
provoked a radical rethinking of our tools and methods, resulting in 
the following: 

* A continuous and proactive cooperation between OLAF and DG INFSO was 
set up. 

* Audit methods were brought in line with current standards. Entities 
were assessed as a whole, gathering as much information as possible 
before the fieldwork (ISA 315). For every entity, specific risks were 
identified and the audit program adapted accordingly (ISA 240). 

* An innovative data-mining and risk-assessment approach for audit 
preparations was designed. 

* A new intelligence tool (PLUTO, see box) was developed to analyze 
anomalies in large volumes of structured data. 

* Operational data from DG INFSO's contractual and financial systems, 
dating back 10 years and comprising 500 gigabytes of information, were 
downloaded and indexed, allowing keyword search (names, amounts, and 
dates). This information was used in audit preparation and during the 
fieldwork. 

* All past audit reports and documentation on the suspicious companies 
and projects were retrieved and analyzed. 

* A complete inventory of people, companies, and projects under 
suspicion was drawn up. 

[Text box: PLUTO is an intelligence database storing all information 
about the 15,000 beneficiaries and 5,000 research projects funded by 
DG INFSO. PLUTO allows the relationships between the various entities 
it contains (beneficiaries, projects, persons, telephones, and 
addresses) to be analyzed visually. This analysis identifies risky 
areas in the contractual environment, facilitating auditing and 
investigative work. While auditors and investigators still need to 
demonstrate the fraud, PLUTO makes their task easier by locating the 
possible areas to look for fraud. PLUTO is based on the commercially 
available software iBase from i2 Inc. End of text box] 

Building on this information, a large number of targeted audits were 
launched, incrementally building on available information. 

Audits were conducted with the level of secrecy required by 
investigations, limiting the information to a core group of staff. 
Information was shared on a "need to know" basis. Data and documents 
were protected using encryption techniques; they were also protected 
physically. 

Lessons Learned for Ongoing Audits and Investigations: 

While this approach was applied for the first time in a specific fraud 
case, the lessons learned have now been integrated into our respective 
daily activities. The following sections describe some of the key 
elements that have been adopted. 

Preparation for Fieldwork: 

The preparation is designed to: 

* obtain an accurate risk assessment of the entity, 

* devise a proprietary audit program based on identified risks, and, 

* limit the likelihood that audit evidence will be altered. 

The aim is to assess the risk of intentional material misstatements in 
the entity's cost claims. Two main factors influence this risk: 

* the entity's inherent dependency on EU funds and, 

* evidence of misrepresentation in documents submitted to obtain 
funding. 

For this risk assessment, we analyze the entity as a whole, using all 
accessible information sources—internal, open, and commercial. 

Information is extracted from DG INFSO's contract management systems, 
and EU project officers are interviewed about the entity's 
performance. Unexpected changes in the project's objectives are 
highlighted. Documents submitted by the entity are assessed for 
indications of misrepresentation or anomalies (in names, signatures, 
authenticity, authors, or dates). Previous and related audit reports 
on the entity are analyzed. 

Information is collected from company registries: shareholders, 
directors, related entities, contact references, and accounting data. 
Information is cross-checked with open sources (such as Google, 
company Web sites, Wayback Machine, phonebooks, and Google Maps) and 
internal sources. 

Information about the entity's key staff is collected from open 
sources (such as Linkedln, PIPL, 123People, and Yasni) and cross-
checked with the data provided by the entity. 

Information about other fund sources is collected. Income from grants 
is compared with the entity's annual income statements to assess 
potential overdependency on grants, which could be an incentive to 
invent and claim costs not incurred. 

All the gathered information is structured and discussed in a 
brainstorming session with the audit team to determine the key risks 
and the appropriate audit program. 

In most cases, we grant a very short lead-time between the time the 
audit is announced and the fieldwork (2 weeks instead of months) in 
order to find the situation as unaltered as possible. In cases where 
there are clear indications of fraud, OLAF carries out on-the-spot 
checks without any advance warning, involving DG INFSO auditors as 
technical experts. 

During Fieldwork: 

Our aim during fieldwork is to: 

* gain access to essential information, 

* obtain an accurate assessment of the entity, and, 

* safeguard important evidence. 

We implement an audit program that is tailored to the entity, applying 
professional skepticism at every stage. If new elements or new risks 
emerge during the fieldwork, the audit program is quickly fine-tuned 
to address them. We ensure that we incorporate unpredictable or 
unusual components in the program. For example, we: 

* interview employees that worked on EU-funded projects, including 
previous employees; 

* interview the auditors that have signed assurance statements; 

* request that the project's tangible outputs are demonstrated to us; 

* consult documents other than traditional ones (such as general 
ledgers, bank accounts, employment registers, and tax declarations); 

* visit the operational premises of the entity; and; 

* use scientific experts to control the substance and quality of work 
completed. We pay additional attention to any scope limitations 
imposed by the entity. 

Essential documents-—authenticated by the entity where relevant-—are 
safeguarded as part of the audit documentation. In doing so, we also 
bear in mind the need for OLAF investigators to substantiate their 
case and allow documents to be swiftly transmitted to national 
judicial authorities. 

Feedback to the audited entity may be limited to protect subsequent 
audits or investigations. 

After the Fieldwork: 

After the fieldwork, our main goal is to: 

* carefully consider whether we have grasped the complete picture, 
seeing the forest and not only the trees, and, 

* document the audit findings accurately and in a self-explanatory way. 

We analyze the collected information for coherence and plausibility. 
In some cases, we organize audits in related entities to obtain a 
complete overview. Communication of conclusions to the audited entity 
may be deferred until all the linked audits have been completed.
All comments that the audited entity makes when reviewing the audit 
findings are carefully analyzed, and the audit conclusions are worded 
carefully. 

We feed lessons we have learned concerning potential weaknesses of 
operational controls into DG INFSO operational services to allow them 
to improve the controls of the payment and other processes 
(information technology systems, changing procedures, training staff). 

We actively encourage that audit conclusions be implemented as swiftly 
and efficiently as possible in order to achieve a rapid recovery of 
improper payments and to dissuade other beneficiaries from similar 
fraudulent activities. 

Challenges: 

Our new approach is not only resulting in more effective audits and 
investigations, but also preventing problems. However, it also brings 
new challenges: 

* Success in detecting irregularities results in increased risk of 
litigation, with additional burden and cost to the European Commission. 

* More effective audits increase the reported error rate, which, 
paradoxically, could result in the perception that the system is more 
vulnerable to fraud than before. 

Both these points underline the importance of active communication 
with internal and external stakeholders to avoid serious 
misunderstandings. The underlying reasoning should be that detecting 
fraud is a positive result that demonstrates an improved control 
system and, first and foremost, helps ensure that money is used for 
its intended and rightful purpose. 

Therefore, higher error rates that result from better detection 
mechanisms are, at least in the short term, good news and a promise of 
better public services in the future. 

Conclusions: 

This article demonstrates how EC services implemented INTOSAI's motto, 
"Experientia mutua omnibus prodest."In this case, mutual experience 
did benefit all and resulted in a new combined audit and investigation 
approach that helped to successfully untangle a very complex and 
costly example of fraud. 

The lessons learned have already led to improved financial and other 
controls in INFSO. The new approach and tools will also be used by 
other EC bodies to implement their risk analysis and organize their 
controls. 

We are sure the improved detection of irregularities and the 
subsequent administrative, financial, and judicial follow-up will also 
prevent future problems. 

However, we also expect that perpetrators of fraud will apply their 
own lessons learned, which means that our methods will need continuous 
updating to keep abreast of a changing reality. This case has given us 
new perspectives and a salutary electroshock, preparing us also for 
new challenges. We have identified misrepresentation as a key risk 
factor in our audit work and developed appropriate methods to cover 
this risk. Things will never be the same again. 

For additional information, please contact the authors at: 
kjell.larsson@ec.europa.eu or freddy.dezeure@ec.europa.ek 

Footnote: 

[1] To improve readability, the term "fraud" is used here to refer to 
irregularities and suspected fraud, even though the allegations have 
not been substantiated in a court of law. 

[End of section] 

XI ASOSAI Assembly and 4th ASOSAI Symposium: 

The XI ASOSAI Assembly and 4th ASOSAI Symposium were held October 12-
15, 2009, in Islamabad, Pakistan. Participants included 138 delegates 
from 31 member SAIs and observers from the INTOSAI Secretariat and the 
INTOSAI Development Initiative (IDI). The ASOSAI Governing Board met 
for its 40th and 41st meetings before and after the assembly and 
symposium, respectively. 

[Photograph: Participants in the ASOSAI Assembly in Islamabad, 
Pakistan, in October 2009] 

The inaugural ceremony of the assembly was chaired by Farooq H. Naek, 
Chairman of the Senate (upper house of the Parliament) of Pakistan. 
Liu Jiayi, then Chairman of ASOSAI and Auditor General of China 
National Audit Office, and Josef Moser, INTOSAI Secretary General and 
Auditor General of Austria, welcomed the attendees during the opening 
ceremony. 

In his inaugural address, Mr. Naek stated, "Supreme Audit Institutions 
are important pillars of good governance. They play a crucial role in 
ensuring that public resources are managed and utilized with financial 
propriety and in compliance with the laws and rules. The greater the 
powers, independence, and capacity of audit institutions, the greater 
will be the impact on the country's financial management and 
operations besides promoting transparency, accountability, and good 
governance." He emphasized that the "spirit of democracy lies in 
openness, fair play, transparency, and accountability. An efficient 
and effective SAI goes hand in hand with democracy and good 
governance." Mr. Naek expressed his hope that the deliberations and 
discussions in the assembly and the symposium would be productive and 
contribute to the promotion of good governance—a common goal we all 
cherish. 

First Plenary Session: 

During the first plenary session, the assembly approved reports on 
ASOSAI's (1) activities since the 2006 assembly in China, (2) 2008 
financial statements and the Audit Committee report on those 
statements, (3) strategic plan, (4) training activities, including IDI-
INTOSAI activities for ASOSAI, (5) eighth research project on 
environmental auditing, and (6) journal and Web site. Reports on 
INTOSAI's Finance and Administration and Knowledge Sharing Committees 
were also presented. 

The assembly also discussed the ASOSAI strategic plan. In view of the 
significant progress made under the plan, the assembly approved the 
recommendation of the 40th ASOSAI Governing Board meeting to develop 
an updated 5-year strategic plan for 2010-2014 and to set up a task 
force to carry out this work. 

The assembly approved an amendment to the ASOSAI Charter making the 
ASOSAI Training Administrator a member of the Governing Board. As a 
result, the Board of Audit of Japan, the current ASOSAI Training 
Administrator, has become a board member. The assembly also increased 
the size of the Governing Board from 9 to 11 members, with the 
outgoing Chairman and Secretary General serving for one additional 
term to recognize their past contributions and provide continuity in 
the board's functioning. 

The assembly approved the recommendation that ASOSAI's rules and 
regulations explicitly reflect the board's responsibility to seek and 
nominate the next host/Secretary General candidate and nominate the 
ASOSAI representative to the INTOSAI Governing Board. 

The assembly recognized the best article published in the ASOSAI 
journal (the Asian Journal of Government Audit) over the preceding 3 
years. The journal's Board of Editors (the heads of the SAIs of the 
Philippines, Sri Lanka, and India) served as the panel of judges and 
named "Problems of Risk Assessment in Group Financial Statements" by 
Tanweer Ahmed of the SAI of Pakistan, published in the October 2007 
issue, as the best article. 

During the first plenary session, the chairmanship of ASOSAI was 
transferred from Liu Jiayi, Auditor General of China, to Tanwir Ali 
Agha, Auditor General of Pakistan. On that occasion, Mr. Liu thanked 
the ASOSAI community for its contributions and support during his 
tenure and expressed his anticipation of ASOSAI's continued success in 
the future. Mr. Agha acknowledged ASOSAI's progress under China's 
leadership and his appreciation for Mr. Liu's stewardship of the 
organization. Mr. Agha assured ASOSAI members that he would focus on 
carrying ASOSAI's mission forward within the framework of its charter 
and with the cooperation, assistance, and support of the ASOSAI family 
and its strategic partners. 

Second Plenary Session: 

During the second plenary session, the assembly approved the Governing 
Board recommendation that the SAI of India host the XII ASOSAI 
Assembly in 2012. The assembly also elected the SAIs of Kuwait, 
Indonesia, Bangladesh, Turkey, Vietnam, and Iraq to the Governing 
Board and approved the selection of the SAI of Korea as the next 
Secretary General. The assembly also approved the ASOSAI budget for 
20092011 and the report of the ASOSAI Working Group on Environmental 
Auditing for 2006-2009. 

During the second plenary session, Hwangsik Kim, Chairman, Board of 
Audit and Inspection of Korea, took over as Secretary General from 
Vinod Rai, Comptroller and Auditor General of India. In his remarks, 
Mr. Kim noted that the 21st century is characterized by ever-changing 
information and that SAIs need to commit themselves to ongoing renewal 
and innovation to keep pace with changing demands. He assured the 
ASOSAI fraternity that he would focus on fully supporting member SAIs 
as they take initiatives to face the challenges of the 21st century. 

Fourth ASOSAI Symposium: 

The 4th ASOSAI Symposium, held on October 14, addressed the role of 
SAIs in enhancing the effectiveness of public expenditures and was 
moderated by Tanwir Ali Agha, the new ASOSAI Chairman. Vinod Rai, then 
Secretary General of ASOSAI, noted in his opening remarks the 
significant role that public audit plays in enhancing the 
effectiveness of public expenditures. Muhammad Anwar, Deputy Auditor-
General of Pakistan delivered the keynote address, followed by special 
reports from the SAIs of Sri Lanka, Kazakhstan, and Vietnam and a 
panel discussion by representatives from the SAIs of Bhutan, Malaysia, 
Pakistan, and Russia. 

The following common elements emerged during the presentations and the 
subsequent open discussion among all participants: 

* Stakeholders around the world are interested in enhancing the 
effectiveness of public expenditures. SAIs have a responsibility to 
ensure that the expectations of society at large are met. 

* Timely accountability is very important in ensuring effectiveness, 
and SAIs play a fundamental role in ensuring effectiveness through 
high-quality, timely reports. Delayed audit reports are not relevant 
and do not enhance effectiveness or support accountability. 
Transparency also plays a significant role in this regard. The media 
in particular highlight specific issues. 

* To evaluate effectiveness, appropriate and acceptable performance 
indicators must be developed to establish benchmarks against which the 
effectiveness of expenditures can be measured. The SAI of Malaysia has 
developed an innovative Accountability Index against which agencies 
are rated; this concept generated significant interest among 
participants. 

* SAIs cannot play their roles in isolation. They must develop links 
with other stakeholders, such as Parliaments, the executive branch, 
media, and citizens. SAIs need to create greater awareness of the 
problems they identify. However, they need to do this in accordance 
with the environment and legal and constitutional frameworks within 
which they operate. 

* Value-for-money/performance audit and special audit reports are 
appropriate and effective tools in reporting on the effectiveness of 
public expenditures. 

* SAIs must insist on robust and rigorous internal controls. SAIs must 
ensure that internal controls are not only in place but are also 
effective. The effectiveness of internal audit must be similarly 
evaluated. 

* While high quality and timely audit reports are important, it is 
equally important that there be compliance with the directives issued 
by the competent forum at which the reports are discussed. New audit 
reports must start by identifying issues of non-compliance. 

* The quality of institutions and processes has a significant impact 
on the effectiveness of public expenditures. 

For additional information, contact the SAI of Pakistan: 

E-mail: agp@agp.gov.pi: 
Web site: www.agp.gov.pk: 

[End of section] 

VIII CAROSAI Congress: 

The VIII CAROSAI Congress was held in Belize City, Belize, February 15-
19, 2010. The congress theme was promoting effective auditing through 
an audit quality assurance management framework, and participants 
included auditors general and directors of audit from across the 
Caribbean region and observers from other SAIs, external 
organizations, and this Journal. 

The outgoing Chair of CAROSAI, Terrance Bastian, Auditor General of 
the Bahamas, opened the first general plenary meeting. At that 
meeting, Dan Duguay, then Auditor General of the Cayman Islands and 
the Chairman of CAROSArs Regional Institutional Strengthening 
Committee (RISC), presented a report noting that the RISC program was 
coming to an end. He submitted a resolution to dissolve the RISC that 
was approved by the participants. 

Else Karin Kristensen, Deputy Director General of the INTOSAI 
Development Initiative (IDI), made a presentation on IDI's role in 
CAROSAI and activities since the previous congress. She reported that 
the emphasis had been on the transfer of learning for on-the-job use 
and that a handbook on quality assurance for financial audits had just 
been issued. She also noted that risk-based audit had been identified 
as a future priority for the region. 

Terrance Bastian and Lorelly Pujadas, IDI Institutional Strengthening 
Manager, discussed CAROSArs operational plan for 2009. They reported 
that several proposed 2009 activities linked to the projects funded by 
the World Bank had not been undertaken since the process of procuring 
a World Bank project consultant is ongoing. It was decided that a 
subcommittee of the VIII Congress would develop a resolution that 
would allow CAROSAI to raise its concerns about the nonfunctional 
nature of certain Public Accounts Committees at the next meeting
of CARICOM (the Caribbean Common Market), scheduled to be held in 
Trinidad and Tobago. 

Florence Lee, Auditor General of Montserrat, presented a paper on the 
role of SAIs in the fiscal management strategies of government in 
times of global crisis. Pamela Monroe Ellis, Auditor General of 
Jamaica, presented a paper on promoting effective auditing through a 
quality assurance framework. 

[Photograph: Florence Lee, Auditor General of Montserrat, addresses 
the CAROSAI Congress in Belize] 

In the areas of knowledge sharing and capacity building, Ms. Pujadas 
also reviewed the risk-based approach to financial audit programs, 
providing the heads of SAIs with detailed information on how this 
approach will be used on the next joint cooperation program that 
CAROSAI will undertake. The SAIs of Jamaica, Barbados, and St. Lucia 
confirmed their participation in the program. The SAI of Guyana also 
asked to be part of the program. The SAIs of St. Lucia and Barbados 
agreed to host a development workshop and review meeting, respectively. 

Several external participants also made presentations at the congress. 
Gillian Fawcett, head of public sector policy for the Association of 
Chartered Certified Accountants, led a public sector round table 
discussion. Robert Reeve, a senior analyst and value-for-money 
specialist at the United Kingdom's National Audit Office, discussed 
enhancing SAI value-for-money capability. Rolf Elm Larsen, a director 
with the SAI of Denmark and representative of the Professional 
Standards Committee, discussed the role of standards and, 
specifically, the International Standards of Supreme Audit 
Institutions (ISSAI). John Noseworthy, Auditor General of the Province 
of Newfoundland and Labrador, Canada, reviewed a recent audit his 
office conducted regarding the allowances spent by members of the 
provincial parliament. 

Representatives of the OLACEFS Chair (the Colombian SAI), the 
Organization of American States, and the Inter-American Development 
Bank (IDB) also made brief presentations on topics including the 
initiatives of the Colombian SAI to fight corruption and the changing 
role of the IDB. 

At the second general plenary session, delegates discussed the 
strengthening and sustainability of CAROSAI as a regional body. In 
this regard, a four-committee structure for implementing the goals of 
the CAROSAI strategic plan for 2011 was ratified. The General 
Secretary noted that a manager and an administrative assistant at the 
CAROSAI Secretariat may be needed to facilitate administrative and 
program activities resulting from a World Bank grant. 

It was also noted that IDI would facilitate a study tour for the 
Chairman and Secretary General of CAROSAI to the office of the AFROSAI-
E (English-speaking AFROSAI) Secretariat based in Pretoria, South 
Africa, in March. The purpose of the tour is to observe the 
organizational structure and sustainability models at the AFROSAI-E 
Secretariat with a view to enhancing CAROSAI's institutional capacity. 

In other business, a new Executive Council was established with the 
SAI of Belize as Chair; the SAI of St. Lucia as Secretary General; and 
the SAIs of Montserrat, Antigua and Barbuda, and Trinidad and Tobago 
as members. The SAI of Jamaica was appointed auditor, and the SAI of 
the Bahamas was named as CAROSAI's representative to the INTOSAI 
Governing Board. 

At the end of Congress, Edmund Zuniga, Auditor General of Belize and 
the incoming CAROSAI Chair, noted that it was time for CAROSAI to 
begin drafting a new strategic plan. 

The SAI of Trinidad and Tobago agreed to host the IX CAROSAI Congress 
in 2013. For additional information, contact the SAI of Belize: 

E-mail: zgp@agp.gov.pk: 
Web site: www.agp.gov.pk: 

[End of section] 

Spotlight on The Strategic Plan: 

by Kirsten Astrup, INTOSAI Director of Strategic Planning: 

[Photograph: Kirsten Astrup] 

At the 2004 INCOSAI in Budapest, member countries unanimously adopted 
INTOSAI's first-ever strategic plan. During the past 2 years, I have 
had the honor and pleasure of assisting the Chair of INTOSAI's 
Strategic Planning Task Force in developing the organization's second 
strategic plan in close cooperation with the Secretary General, the 
goal chairs, and other task force members. The final plan
document will be distributed to the Governing Board and all members 
SAIs before it is presented to the XX INCOSAI for approval. 

During the first hearing round, we incorporated comments received from 
both the task force and INTOSAI members and, during March/April 2010, 
produced a new draft plan based on the task force members' review. 
That draft was translated into INTOSAI's official languages in May 
2010 and sent to all SAIs for a second hearing round. 

Most of you are still reviewing that draft, but I have already 
received some comments from member SAIs. I am looking forward to 
analyzing these comments in more depth, as I am convinced that they 
will improve the latest draft of the second strategic plan. I believe 
that this will be the final draft of the plan for 2011-2016 that I 
will forward to the Chair of the task force following consultation 
sessions with the four goal committee chairs over the summer. While I 
am unsure about the number of drafts I have worked with during the 
past 2 years, every version has been improved after incorporating 
comments from the task force, the Finance and Administration 
Committee, and the Governing Board as well as from the whole 
membership during the first hearing round. 

In the April issue of the Journal, I wrote about key issues in the 
revised INTOSAI strategic plan for 2011-2016 and the importance of 
INTOSAI's seven core values, which form the basis for the new plan. In 
my opinion, the strategic plan has revitalized the whole organization—
not only the chairs of our four strategic goal committees
and the subcommittees, working groups, and task forces, but also all 
the supreme audit institutions (SAI) participating in those groups 
that are implementing the plan's strategic objectives and activities. 
In our SAIs, we already have thousands of people working to promote 
INTOSAI and advocate for it as a model international organization. 

While having a strategic plan is important, it is equally important to 
ensure that the elements of the plan are being implemented effectively 
to achieve the plan's strategic objectives. Since being appointed 
Director of Strategic Planning, I have closely followed activities 
related to the plan. I am happy to witness every day that INTOSAI's 
first strategic plan continues to be implemented with great efficiency 
and broad-based support. 

At the beginning of May, I participated in the meeting in Copenhagen 
of the Steering Committee of the Professional Standards Committee, 
together with about 40 other professionals who demonstrated their 
strong engagement in efforts to improve our organization by developing 
standards and other audit guidance material. The Steering Committee of 
the Capacity Building Committee also recently held its annual meeting 
in Washington, and the Steering Committee of the Knowledge Sharing 
Committee will hold its meeting later this summer. 

All the activities and efforts I have witnessed during my period as 
Director of Strategic Planning have clearly demonstrated that INTOSAI 
members are working together in a more structured way as a result of 
our first strategic plan. INTOSAI's motto, "Mutual Experience Benefits 
All," has taken on a renewed meaning for all of us. 

The strategic plan has also opened the door for partnership between 
the international donor community and INTOSAI. The memorandum of 
understanding INTOSAI entered into with the donor community last year 
stipulates, among other things, that donor support will be used to (1) 
develop and implement SAI strategic plans and (2) develop action 
plans, as many SAIs still need support to strengthen their strategic 
planning capabilities. 

A new Director of Strategic Planning will be appointed for the next 3 
years at the XX INCOSAI in South Africa in November. My final column 
in the October issue of the Journal will summarize my experience with 
INTOSAI strategic planning in general and the implementation of the 
second INTOSAI strategic plan. I will also look back and summarize my 
time as Director of Strategic Planning. 

Please feel free to contact me at astrup@rechnungshof.gv.at if you 
have comments or would like to give feedback on issues related to 
implementing INTOSAI's strategic plan. 

[End of section] 

Inside INTOSAI: 

Conference on Strengthening External Public Auditing in the INTOSAI 
Regions: 

On May 26 and 27, 2010, the INTOSAI General Secretariat hosted a 2-day 
conference in the Austrian Parliament on strengthening external public 
audit. Heads of SAIs from INTOSAI's seven regional working groups 
(AFROSAI, ARABOSAI, ASOSAI, CAROSAI, EUROSAI, OLACEFS, and PASAI); 
representatives of the United Nations, World Bank, Interparliamentary 
Union, and donor community; and external experts attended the event. 

[Photograph: Participants in the conference on strengthening external 
public auditing assemble in front of the Austrian Parliament] 

On the first day, the conference sessions addressed the role and 
responsibilities of external public audit. The speakers emphasized the 
role that SAIs play in the system of checks and balances of state 
powers in democracies in ensuring efficient and transparent government 
and accountability and promoting good governance. The speakers also 
underlined the instrumental function of SAIs in fighting corruption 
and achieving the United Nations Millennium Development Goals. There 
was a general consensus that given the current financial and economic 
crisis, SAIs are gaining importance and influence. SAIs are perceived 
as embracing values such as credibility; in addition, they are trusted 
by citizens and the international community. 

The speakers repeatedly stressed independence as a fundamental 
prerequisite for the effective delivery of SAI tasks. The conference 
re-endorsed INTOSAI's objective of incorporating the basic principle 
of independence that the Lima and Mexico Declarations laid down in 
international law. Moreover, the crucial role of INTOSAI's standards 
and guidelines in asserting SAI independence was recognized. 

The speakers emphasized that presenting the value and benefits of 
independent SAIs for government and civil society is another major 
prerequisite for the effectiveness of external public auditing and 
that communication with the public is instrumental in achieving this 
goal. 

The second day of the conference was devoted to SAI capacity building. 
The issues addressed included INTOSAI's cooperation with the donor 
community to build institutional capacity in developing and emerging 
countries. Specific presentations discussed current activities of the 
INTOSAI Development Initiative (IDI) in this area and IDI's role in 
the cooperation between INTOSAI and the donor community. 

Based on the specific needs and challenges identified by the SAIs 
represented, the joint conclusions of the delegates recommended that a 
stronger focus be placed on the following core issues: independence, 
institutional capacity building, the development of material and staff 
competences, the development and use of professional audit standards 
and methods, training and development, knowledge sharing and transfer, 
and the presentation of the value and benefits of independent SAIs. A 
document containing the complete text of the conclusions and 
recommendations was issued after the conference. The document is 
available in INTOSAI's five official languages on the INTOSAI Web site 
(www.intosai.org/en/portal/). 

For additional information, contact the INTOSAI Secretariat at 
intosai@rechnungshof.gv.at. 

Meeting of the Steering Committee of the Professional Standards 
Committee: 

The annual steering committee meeting of the Professional Standards 
Committee (PSC) took place in Copenhagen in May 2010. One of the 
meeting's purposes was to approve the last few International Standards 
of Supreme Audit Institutions (ISSAI) and INTOSAI Guidance for Good 
Governance (INTOSAI GOV) that had been prepared by the PSC 
subcommittees on Financial Audit, Performance Audit, Compliance Audit, 
Internal Control Standards, and Accounting and Reporting, as well as 
the Projects on Audit Quality Control and Transparency and 
Accountability. 

The ISSAI framework has been developed into a comprehensive set of 
standards and guidelines. After a very productive session in 
Copenhagen, the PSC is ready to present 36 ISSAIs and 2 INTOSAI GOVs 
for approval in November at the XX INCOSAI in Johannesburg, South 
Africa. Mr. Otbo, Chairman of the PSC, stated, "It is my hope that 
SAIs around the world will find the ISSAIs useful and supportive in 
their daily auditing practice." 

Three of the new ISSAIs deal with transparency, accountability, and 
quality control. A number of other ISSAIs related to audits of 
financial statements address such areas as audit evidence, using the 
work of internal auditors, sampling, and fraud. Similarly, standards 
for performance and compliance audit are now included in the ISSAI 
framework. The two new INTOSAI GOVs deal with internal auditors and 
cooperation between internal auditors and SAIs. 

[Photograph: Participants in the May 2010 Steering Committee meeting 
of the Professional Standards Committee] 

Before being endorsed at the XX INCOSAI, versions of the new ISSAIs 
and INTOSAI GOVs have been released on www.issai.org in English. 
Translations into the other official INTOSAI languages will be 
available in October. The PSC encourages all INTOSAI members to visit 
the Web site and familiarize themselves with the new standards. In 
line with the request of the South African INCOSAI host to keep 
printed material to an absolute minimum, the new ISSAIs will be 
available only electronically to congress delegates on the ISSAI Web 
site, which also presents information on the ISSAI framework and all 
the previously endorsed ISSAIs. Interested parties can receive news 
from the Web site by signing up for the e-mail update service. 

In the coming years (2011-2013), the PSC will shift its main focus 
from developing new ISSAIs to the following three new tasks: 

* continuing to develop and maintain the current ISSAIs and INTOSAI 
GOVs, 

* raising awareness of the ISSAIs and promoting the visibility of the 
ISSAI framework and the application of the ISSAIs and INTOSAI GOVs in 
SAIs, and, 

* working on the Harmonization Project, which will provide a 
conceptual basis for public sector auditing and ensure consistency in 
the ISSAI framework. 

For additional information, contact the PSC: 

E-mail: psc@rigsrevisionen.dk: 
Web site: http://psc.rigsrevisionen.dk: 

Financial Audit Subcommittee: 

Activities to Raise Awareness: 

The Financial Audit Subcommittee's (FAS) introductory presentation, 
handout, and speaking notes on the INTOSAI Financial Audit Guidelines 
have been translated into the official INTOSAI languages and will be 
available on the FAS Web site by the end of August. The English 
version of the material had previously been sent to key persons 
nominated by SAIs to enable them to give introductory presentations to 
their respective organizations. 

Development of Standards and Guidelines: 

* The Professional Standards Committee (PSC) approved International 
Standards of Supreme Audit Institutions (ISSAI) 1000 and 1003 at their 
May steering committee meeting. 

* The FAS Chair, Gert Jonsson, is a member of the International 
Auditing and Assurance Standards Board (IAASB) and is supported by 
Jonas Hillstrom as technical advisor. The most recent meeting was held 
in Mainz, Germany, in June. 

* FAS continues to appoint experts to IAASB task forces. Currently, 
there are INTOSAI experts on task forces to revise International 
Standard of Accounting (ISA) 610, Special Considerations — Using the 
Work of Internal Auditors, and ISA 720, The Auditor's Responsibility 
in Relation to Other Information in Documents Containing Audited 
Financial Statements. 

* The practice notes included in the ISSAIs have been translated into 
the five official INTOSAI languages. The European Court of Auditors 
generously translated and proofread the French, German, and Spanish 
versions, and the translating firm Biiro Tazir translated the practice 
notes into Arabic. The Arabic version was proofread by the Moroccan 
SAI. 

* The endorsement versions of the ISSAIs for financial audit will be 
available on the ISSAI Web site in all language versions before the 
INTOSAI congress in November. 

FAS Work Plan for 2011-2013: 

The FAS work plan was approved by FAS in April and by the PSC Steering 
Committee in May. The work plan includes the following main tasks: 

* maintaining and continuing to develop the ISSAIs on financial audit, 

* raising awareness, 

* contributing to the consistency of the ISSAI framework, 

* exploring the possibility of including other standards issued by the 
IAASB as part of the financial audit guidelines, 

* summarizing lessons learned, and, 

* monitoring implementation of the guidelines among INTOSAI members. 

Meetings: 

The next FAS meeting will be hosted by the Swedish National Audit 
Office on the island of Sandhamn outside of Stockholm, Sweden, 
September 8-9, 2010. 

For additional information, please contact the FAS Secretariat: 
E-mail: projectsecretanat@riksremssonen.se: 
Web site: http://psc.rigsrevisionen.dk/fas: 

Capacity Building Committee: Advisory and Consultant Services 
(Subcommittee 2): 

The Office of the Comptroller General of the Republic of Peru (CGR), 
Chair of Subcommittee 2 of the INTOSAI's Capacity Building Committee, 
is requesting the collaboration of the INTOSAI community in developing 
a database of experts in the field of public finance. SAIs are asked 
to supply information about professionals currently working in 
different SAIs, as well as recently retired SAI staff who may be 
available to perform consulting and advisory duties upon request of 
other SAIs. 

To register or to search for experts, please fill out the application 
at the following Web site: 
http://apps.contraloria.gob.pefintosai. 

For additional information, contact Subcommittee 2: 
E-mail: cooperacion@contraloria.gob.pe: 

Working Group on IT Audit: 

From April 12-17, 2010, the National Audit Office of the People's 
Republic of China (CNAO) hosted the 19th INTOSAI Working Group on IT 
Audit (WGITA) meeting and 6th Performance Auditing Seminar in Beijing. 
A total of 93 participants from 40 SAIs attended. 

In his welcoming address, Liu Jiayi, Auditor General of the CNAO, 
remarked that with the integration of the global economy and 
increasing communication in recent years, information technology has 
brought new challenges as well as new vigor to the auditing 
profession. He praised the WGITA as an important research group within 
the INTOSAI community that promotes knowledge-sharing in the field of 
IT audit. He also stated that the CNAO would like to strengthen its 
exchanges and cooperation with other SAIs through the WGITA to 
contribute to the development of IT audit. 

Vinod Rai, Chair of the WGITA and Comptroller and Auditor General of 
India, and Anol Chatterji, his Deputy, presided over the meeting and 
seminar, respectively. As this was the last meeting before the XX 
INCOSAI in South Africa in November, participants focused on taking 
stock of WGITA developments and achievements for the current period 
that will be reported to the congress. The participants also discussed 
and approved the results of the survey on future projects for 
initiating the new work plan for 2010-2013. 

During the seminar, 12 papers from 9 SAIs were presented on the theme 
of performance measures indicating IT project effectiveness and 
investment success. Participants exchanged ideas and experiences and 
actively discussed the theme, which may also be addressed at the next 
seminar. 

For more information, please contact the CNAO: 
E-mail: cnao@audit.gov.cn: 
Web site: www.cnao.gov.cn: 

INTOSAI Working Group on Key National Indicators: 

Many countries have developed systems of key national indicators (KNI) 
to address the important issue of evaluating socio-economic 
development. SAIs have a key role to play in this process. A draft 
guide to KNI terms and concepts the U.S. Government Accountability 
Office (GAO) developed in cooperation with the Organisation for 
Economic Co-operation and Development (OECD)[Footnote 1] states the 
following: 

The development of key national indicators can help nations to measure 
progress toward desired national outcomes, assess conditions and 
trends, and help communicate complex issues. Key national indicators 
can be seen as part of efforts to align the programs and policies of 
governments with the results—-a healthy and educated population, 
adequate jobs and housing a healthful and sustainable environment-—
that citizens care about. For Supreme Audit Institutions (SAIs), key 
national indicators represent an important tool to help promote 
transparency and accountability in government. 

SAIs can contribute to the use of KNIs in a wide variety of ways, 
including validating the reliability of indicators and incorporating 
them into their performance audits. KNIs can also support the work of 
audit organizations by providing widely-accepted standards, goals or 
criteria against which to assess government performance. 

Footnote: 
[1] GAO/OECD, Key National Indicators: Draft Guide to Terms and 
Concepts (www.ach.gov.ru/userfileshree/OECD-GA0%20Glossary-tree_files-
fl-186doc), March 2010. 

The INTOSAI Working Group on Key National Indicators was established 
by the XDC INCOSAI (November 2007 in Mexico City) within the framework 
of goal 3 of the INTOSAI Strategic Plan for 2005-2010. The working 
group, which comprises 21 full members and 5 observers, has collected 
extensive materials on SAI experiences in developing and using 
national indicators and launched several pilot projects. It has
carried out scientific and practical tests of methods and techniques 
for multidimensional visualization of KNI measurements. 

The working group's first meeting, held in Moscow in May 2008, was 
attended by representatives of 20 SAIs (16 working group members and 4 
observers) and two international organizations (OECD and the World 
Bank). During this meeting, terms of reference, rules of procedures, 
and a working plan for 2008 were discussed and approved. A working 
plan for 2009 was proposed for further consideration. 

After this first meeting, a bilingual (English and Russian) Web site 
was developed for the working group (www.ach.gov.ru/en/intosaikni). It 
serves as a tool for online exchanges of information related to the 
development and use of key national indicators. 

The working group's second meeting was held in Beijing in April 2009. 
It included a seminar on conceptual approaches to developing and using 
KNI systems. It was attended by 16 SAIs (15 working group members and 
1 observer) and one international organization (OECD). During this 
meeting, the output of the working group subprojects was considered 
and the working plan for 2009 was approved. 

At the working group's third meeting—held April 7-8,2010, in Astana, 
Kazakhstan—the main outcomes of working group activities for the 
preceding 3 years were discussed. In addition to discussing subproject 
outcomes, working group members approved the structure of a white 
paper on developing and using KNI systems and the working plan for 
2010. The white paper provides the basis for developing a reference 
model for SAI activity within the KNI system to develop, implement, 
and compare national strategies for social and economic development. 
Also, a knowledge base on KNIs, which includes data from countries and 
international organizations, and principles for SAI application of 
KNIs were presented at the meeting. The working group members decided 
to examine the working group activities that the Secretariat had 
proposed and draw up a working plan for the next 3 years. 

Since its first meeting, the working group's membership has increased. 
The SAIs of Austria, Israel, Indonesia, and Bulgaria became members 
and Kyrgyzstan joined the group as an observer. 

Several subprojects are being carried out to implement the working 
group's terms of reference: 

* The U.S. GAO prepared the previously mentioned Key National 
Indicators: Draft Guide to Terms and Concepts 
(www.ach.gov.ruluselfiles/tree/OECD-GA0%20Glossarytree_files-j7-
186doc) based largely on GAO and OECD work. More than a glossary, it 
is a dynamic guide to terms and concepts and will be regularly updated 
to reflect new developments in this evolving field. The terms and 
definitions of the guide will be part of the INTOSAI Glossary of 
Auditing Terms. 

* The SAI of Hungary is coordinating a KNI pilot project to develop a 
common set of metrics for a knowledge-based economy in order to allow 
for international comparisons. A final paper on this subproject 
(available at http://www.ach.gov.ru/em/intosiakni/wpaperskni/?id=380)
describes the importance of disseminating knowledge-intensive products 
and services, the need to develop a knowledge society, and the 
indicators in these fields. 

* The SAI of Latvia prepared a review of international experiences in 
developing and using KNIs. The review outlines established principles 
for policy planning and performance measurement in 47 countries that 
were surveyed. The information in this review was obtained through 
responses to a survey and information from publicly available sources. 
The review was divided into three sections: general issues of planning 
and performance measurement, national indicators review, and 
performance management review. 

* The SAI of Russia is coordinating a subproject on KNIs within the 
framework of the Commonwealth of Independent States (CIS). For this 
subproject, draft guidelines for using KNIs in performance audits have 
been prepared. The guidelines include a glossary of English-Russian 
comparisons. The subproject has also (1) analyzed international 
experiences and perspectives on the use of KNIs in the activities of 
the SAIs of CIS member states and (2) developed a knowledge base of 
KNIs. Also, a KNI expert group, comprising the heads of the CIS SAIs, 
was established and met three times in 2008 and 2009. All the 
documents of the expert group have been placed on its Web site 
(www.ach.gov.ru/ru/th). 

The working group's cooperation with the OECD has been an important 
part of its activities. In early 2009, the two parties signed a 
memorandum of understanding (MOU) to collaborate on measuring the 
progress of societies. In accordance with the MOU, the working group 
organized a parallel session entitled "Key National Indicators in the 
System of External Control" during the OECD Third World Forum in 
Busan, Korea, in October 2009. During that session five members of the 
working group—representatives of Austria, Poland, Hungary, the United 
States, and Russia—discussed issues of knowledge-based economies and 
societies, KNIs as a tool of planning and auditing, and issues in the 
use of KNIs in SAI activities. 

The activities of the working group were reported in this Journal 
(January 2009), in the Asian Journal of Government Audit (April 2009), 
and at the first meeting of the INTOSAI Knowledge Sharing Committee 
(under goal 3 of the INTOSAI Strategic Plan) in New Delhi, India, in 
March 2009. The working group will report on its activities over the 
past 3 years and its proposals for the future at the XX INCOSAI in 
South Africa in November 2010. 

Underlying the working group's activities is a recognition that each 
country has its own values and chooses its own goals and paths to 
development. Asian, African, American, and European countries have 
very different starting points, capabilities, and traditions. While 
sharing an interest in having metrics for measuring progress both 
nationally and globally, working group members recognize that the 
national, historical, cultural, and economic differences within each 
country should be respected. 

This means that in developing KNIs, the objective should be 
transparency in the formation, implementation, and assessment of 
national strategies rather than unification. Working group members 
believe it would be inappropriate to draw up a prescriptive list 
enumerating KNIs for development. At the same time, however, SAIs can 
play a constructive role in ensuring that KNIs in their own countries 
are reliable and relevant and can serve as a basis for assessing 
government performance. 

For additional information, contact the working group: 

E-mail: intrel@ach.gov.ru, inorg@ach.gov.ru: 
Web site: www.ach.gov.ru/en/intosaikni: 

Meeting of the Working Group on the Value and Benefits of SAIs
The Working Group on the Value and Benefits of SAIs met in Moscow 
during March 2010. The Auditor-General of South Africa, Terence 
Nombembe, chaired the meeting, which was hosted by Sergey Stepashin, 
the Chairman of the Accounts Chamber of the Russian Federation. The 
meeting's objectives included finalizing the group's discussion paper 
that is to be presented at the XX INCOSAI in South Africa later this 
year and discussing the future plans of the working group. 

The working group agreed on the following in principle: 

* a framework to communicate and promote the value and benefits of 
SAIs; 

* inclusion of the framework in the ISSAI framework following proper 
due process; 

* the need to promote global understanding on the value and benefits 
of SAIs; 

* use of the framework as a basis for assessing where SAIs need 
further assistance and where INTOSAI can develop that guidance; and; 

* use of the framework as another tool to provide input into the 
INTOSAI strategic plan. 

The final discussion paper on the value and benefits of SAIs will be 
made available in all official INTOSAI languages on the official 
INCOSAI Web site (www.incosai.co.za) by the end of July 2010. 

The next meeting of the working group is planned for November 20, 
2010, in Sandton, Johannesburg, South Africa, preceding the INTOSAI 
Governing Board meeting and the XX INCOSAI. 

For additional information, contact the SAI of South Africa: 
E-mail: agsa@agsa.co.za: 
Web site: www.agsa.co.za: 

Third Meeting of the INTOSAI Communications Task Force: 

Based on the Communications Policy adopted by the XIX INCOSAL the 
INTOSAI Governing Board resolved in November 2007 to establish the 
INTOSAI Communications Strategy Task Force, under the chairmanship of 
the INTOSAI Secretary General, to enhance INTOSAI's internal and
external communications. The members are India (ASOSAI and the INTOSAI 
Collaboration Tool), Libya (AFROSAI), New Zealand (PASAI), Norway 
(IDI), Panama (OLACEFS), Spain (EUROSAI), St. Lucia (CAROSAI), Tunisia 
(ARABOSAI), and the United States of America (this Journal). 

The third meeting of the INTOSAI Communications Strategy Task Force 
took place on May 28, 2010, at the Austrian Court of Audit in Vienna. 
Attending the third meeting were representatives from the SAIs of 
Austria, Belize, Denmark, India, Mexico, Morocco, Norway, Pakistan, 
Panama, Poland, Saudi Arabia, South Africa, South Korea, Spain, 
Tunisia, the United States of America, and Yemen. 

Dr. Josef Moser, Secretary General of INTOSAI and chair of the task 
force, welcomed task force members. The SAI of India presented an 
update on the INTOSAI collaboration tool and distributed a training CD 
to task force members, noting that this Journal had recently run an 
article profiling the collaboration tool and that any SAI could 
request access to the tool for its staff or INTOSAI work groups by 
sending an e-mail to the SAI of India at support@intosaictool.org. 

Task force members then reviewed and commented on a draft of the 
INTOSAI Communication Guideline, which sets out the principles of 
internal and external communication for INTOSAI and its members to (1) 
ensure effective, transparent, accurate, and timely communication and 
(2) help enhance the visibility of the organization. A final draft, 
based on the comments received at the meeting, will be circulated to 
task force members for another round of comment. 

The task force also continued work on a SWOT (Strengths, Weaknesses, 
Opportunities, and Threats) analysis of INTOSAI communications to help 
develop appropriate communication strategies for the organization. 
Task force members agreed to submit to the chair by the end of June 
the elements identified to date in the SWOT analysis that they 
consider to be most important. 

The next task force meeting will be held during the XX INCOSAI in 
Johannesburg, South Africa, in November. 

For additional information, contact the INTOSAI Secretariat: 

E-mail: intosai@rechnungshof.gv.at
Web site: www.intosai.org: 

EUROSAI Seminar on Performance Audit of Social Programs for 
Professional Integration of the Disabled: 

In January 2010, the SAI of Poland (NIK) hosted a 2-day seminar on 
performance audit of social programs for professional integration of 
the disabled. The seminar was organized in cooperation with the 
European Institute of Public Administration and its Warsaw-based 
European Centre for Public Financial Management, which contributed 
subject matter expertise on the topic. The seminar was designed for 
EUROSAI practitioners involved in auditing social programs. 

The seminar's objective was to discuss the experiences of EUROSAI 
member SAIs and give delegates a step-by-step approach to use in 
designing, managing, and conducting performance audits and reporting 
findings. The inspiration for the seminar came from the VII EUROSAI 
Congress held in Krakow in June 2008, one of whose themes was the 
audit of social programs for the professional integration of the 
disabled. The congress recommended that SAIs take full advantage of 
the opportunities to share knowledge and experience that EUROSAI 
colleagues had already gained in this area. The NIK of Poland decided 
to follow up on this recommendation during its term as President of 
the EUROSAI Governing Board by offering this seminar and a parallel 
audit on employing persons with disabilities in the public sector. 

[Photograph: Participants in the EUROSAI seminar in Poland on auditing 
social programs for the professional integration of the disabled] 

All materials from the seminar-—general information, presentations, 
and group photos—-are available on the EUROSAI Presidency Web site at 
www.eurosai2008.pl. 

For additional information, contact the NIK: 

E-mail: wsm@nik.gov.pl: 
Web site: www.nik.gov.pl: 

[End of section] 

IDI Update: 
IDI Update keeps you informed of developments in the work and programs 
of the INTOSAI Development Initiative. To find out more about IDI and 
to keep up to date between editions of the Journal, look at the IDI 
Web site: www.idi.no. 

IDI/OLACEFS Train the Trainer Program: 

In response to OLACEFS' request that IDI train a new group of training 
specialists, preparations have been completed for the region's third 
round of the modified Train the Trainer Program during 2010. The 
program, which now includes modules on capacity building and learning 
for impact, will be delivered as a blend of e-learning and classroom 
training. Its first activity was the online selection of 50 
participants. The next activity will be the online delivery of the 
Course Design and Development Workshop (CDDW). Participants who 
successfully complete the CDDW will be invited to an Instructional 
Techniques Workshop (ITW) to be held in 2011. At this workshop, they 
will learn and have opportunities to practice a variety of 
instructional techniques. They will also be evaluated on their 
instructional and facilitation skills. Participants who successfully 
complete the CDDW online and the ITW will graduate as IDI-certified 
training specialists. 

Transregional Capacity Building Program on Public Debt Management: 

In 2008, IDI launched the Transregional Capacity Building Program on 
Public Debt Management, which is designed to enhance professional 
staff development and the organizational capacity of participating 
SAIs in public debt audit. The program, which will continue until 
2011, is being delivered in cooperation with the Debt Management 
Program (DMFAS) of the United Nations Conference on Trade and 
Development (UNCTAD), the United Nations Institute for Training and 
Research, and the INTOSAI Working Group on Public Debt (WGPD). 

For the program, audit teams from 29 participating SAIs are expected 
to hold an audit planning meeting and carry out public debt management 
audits in accordance with their audit plans before February 2011. 
Expert teams from the WGPD, DMFAS, and UNCTAD will support them during 
these audits. Experts from the World Bank and the Commonwealth 
Secretariat, as well as regional subject matter experts, will also 
participate in the program. Support for the participating SAIs will be 
provided through the Internet or through visits as needed. The audit 
teams will also be encouraged to share their experiences and 
challenges with other SAI teams. By the end of this phase in February 
2011, the teams are expected to have tested the draft audit procedures 
for their SAIs and prepared a draft of their audit findings. 

IDI/PASAI Cooperative Performance Audit Reporting Meeting: 

In 2009, IDI cooperated with PASAI and the Asian Development Bank on 
the region's first cooperative performance audit of an environmental 
issue (solid waste management). After a pilot study and audit planning 
meeting last year, teams from 10 SAIs completed their field audits and 
preliminary data analysis by the end of February 2010 and sent their 
draft audit findings to a subject matter expert (SME) and IDI.
IDI invited the teams that had completed the field assignment to a 
meeting on writing audit reports that was held in Fiji April 8-15, 
2010. The participating SAIs were from Fiji, the Cook Islands, the 
Federated States of Micronesia, the Marshall Islands, Palau, Tonga, 
Tuvalu, Papua New Guinea, Guam, and Samoa. During the meeting, the SME 
and IDI staff reviewed and approved the reports. As the last component 
of the program, the reports have been taken back to the respective 
SAIs for approval from the Auditors General. 

[Photograph: Participants in the April 2010 PASAI reporting meeting in 
Fiji for the first cooperative performance audit on solid waste 
management] 

During 2008 and 2009, IDI conducted a train-the-trainer program for 
French-speaking sub-Saharan African SAIs. Twenty-five new training 
specialists graduated from that program and an audit methodology 
course was designed and delivered. The same audit methodology course 
has been revised and is being delivered locally in 2010 to strengthen 
the audit capacity of selected SAIs in French-speaking sub-Saharan 
Africa. Based on the results of a survey questionnaire, the SAIs from 
four countries (Burkina Faso, Burundi, Congo Brazzaville, and the 
Democratic Republic of Congo) were selected to participate. 

The first stage of the program was a planning meeting at which the 
heads of the four selected SAIs agreed on the program process and 
outcomes and provided the input needed to customize the program to 
their SAIs' specific needs. During the next stage of the program, four 
instructor teams are attending workshops in June and July to design 
local audit methodologies. Each team is responsible for designing an 
audit methodology course tailored to the needs of one SAI. All 
relevant International Standards for Supreme Audit Institutions 
(ISSAI) have been incorporated into the workshop materials. 

Transregional Capacity-Building Program for Performance Audits of 
Environmental Issues in Forestry: 

IDI is cooperating with the INTOSAI Working Group on Environmental 
Audit (WGEA) on a Transregional Capacity-Building Program for 
Performance Audits of Environmental Issues in Forestry. This program 
has been designed to promote active knowledge-sharing and learning by 
doing, and its objective is to build professional and organizational 
capacity to conduct forestry-related performance audits in 12 
participating SAIs from three English-speaking INTOSAI regions: 
ASOSAI, AFROSAI-E (English-speaking AFROSAI), and CAROSAI. At the May 
2010 planning meeting, representatives from the INTOSAI WGEA 
Secretariat, subject matter experts, and IDI staff agreed on key 
program activities, roles and responsibilities, as well as audit areas 
and objectives. The program was launched at the INTOSAI WGEA Meeting 
in China in June. 

[Photograph: Participants in the May 2010 planning meeting held in 
Oslo for the Transregional Capacity-Building Program for Performance 
Audits of Environmental Issues in Forestry] 

IDI/CAROSAI Development Workshop for the Risk-Based Approach to 
Financial Audit Guidance: 

At the February 2009 CAROSAI meeting, the heads of regional SAIs 
ranked the risk-based approach to audit (RBA) as their highest 
priority. It was agreed that IDI and CAROSAI would launch an RBA 
program to assist SAIs in implementing professional standards by 
developing and initiating a risk-based approach to financial audits. 
At a development workshop, which took place in St. Lucia in May 2010, 
a team of regional financial auditors, a subject matter expert, and 
IDI's Program and Institutional Strengthening Managers worked together 
for 8 days to develop a step-by-step guide with practical tools to 
facilitate implementation of a risk-based approach for financial 
audits. The guide has been aligned to ISSAIs and other best practices. 

Contacting IDI: 

To discuss any of the issues raised in this edition of the IDI Update, 
please contact IDI: 

E-mail:	idi@idi.no: 
Web site: www.idi.no: 

[End of section] 

INTOSAI 2010 Events: 
	
July 7-12: 
13th PASAI Congress, Tarawa, Kiribati. 

July 12-13: 
Meeting of the Working Group on Accountability for and Audit of 
Disaster-related Aid, Lima, Peru. 

August 5-6: 
Meeting of the Working Group on the Fight against Corruption and Money 
Laundering, Quito, Ecuador. 

August 11-13: 
Meeting of the Steering Committee of the Committee on Knowledge 
Sharing and Knowledge Services, Mexico. 

September 8-9: 
Meeting of the Financial Audit Subcommittee, Sandhamm, Sweden. 

September 14-16: 
Meeting of the Global Financial Crisis Task Force, London, England. 

September 27-30: 
Meeting of the Performance Audit Subcommittee of the Professional 
Standards Committee, Brasilia, Brazil 

October	26-27: 
10th General Assembly of ARABOSAI, Riyadh, Saudi Arabia. 

November 20: 
Meeting of the Working Group on the Value and Benefits of SAIs, 
Johannesburg, South Africa. 

November 21: 
Meeting of the Professional Standards Committee, Johannesburg, South 
Africa. 

November 22-27: 
760th INTOSAI Governing Board meeting, XX INCOSAI, 61st INTOSAI 
Governing Board meeting, Johannesburg, South Africa. 

December 8-9: 
Financial Audit Subcommittee meeting, Stockholm, Sweden. 

Editor's Note: This calendar is published in support of INTOSAI's 
communications strategy and as a way of helping INTOSAI members plan 
and coordinate schedules. Included in this regular journal feature 
will be INTOSAI-wide events and regionwide events such as congresses, 
general assemblies, and board meetings. Because of limited space, the 
many training courses and other professional meetings offered by the 
regions cannot be included. For additional information, contact the 
Secretary General of each regional working group. 

[End of July 2010 Edition of The Journal]