The internal checks and balances in the accounting function and consequent financial transparency and accountability in the public sector is potentially at risk with the current plans for restructuring the internal audit function of the MMDAs the Institute of Internal Auditors (IIA) has warned.
In the 2018 Mid-Year Fiscal Policy Review Statement and the 2019 budget, the Finance Minister indicated the need to restructure and strengthen the Internal Audit Function in the public sector.
However, the Institute insists that the plans to make the audit function a department under the Ministry of Finance (MoF) not only has the potential of weakening internal financial controls in public institutions, but could furthermore make MoF a “super ministry”.
In an interview with Goldstreet Business, at the 2018 Board, CEO, MCE, DCE Forum on Wednesday in Accra, the President of IIA, Juliet Aboagye-Wiafe noted that majority of members believe that the current structure should be left as it is, but it has to be strengthened because as at now public sector internal auditors don’t have the resources to work.
“As an internal auditor in a company, when I have to report something I have to report to the board, there is no way you should report to a finance person, since the internal auditor audits the finance people,” Aboagye-Wiafe said.
The real issue has to do with the rationalization of the salaries and conditions of services of staff of all the three key financial institutions- Audit Service, Internal Audit Agency and the Controller and Accountant General’s Department (CAGD), she stated.
The current law, Internal Audit Agency Act, 2003(Act 658), and the structure of IAA does not empower it to effectively supervise, manage and regulate the practice of internal auditing in the public sector.
At the forum, Dr. Eric Oduro Osae, the Technical Advisor of the Ministry of Local Government and Rural Development said “once this rationalization takes place and the Internal Audit Agency (IAA) is changed from Agency to a Service and Audit Service moved from Service to an Authority, sanity will prevail in our financial sector.”
Currently, the Ministry of Finance is supporting the Internal Audit Agency to conduct extensive stakeholder consultations as part of the key processes that will lead to its restructuring.
By Joshua W. Amlanu