Đề tài Performance audit with enhancing effectiveness of Collecting and spending toll fee

apers. The analysis might also require comparisons of findings between: operations that work well and those that work less well – see analysis example below; one or more operation and an overview of the subject; An audited area and a similar audit area in another country. The final stage in the analysis of data involves combining the results from different types of sources. This phase involves weighing up arguments and assertions, consulting experts, and making comparisons and analyses. Tools that can used for data analysis include excel spreadsheets and software packages designed specifically for questionnaire entry such as SNAP and SPS Data Entry, SPSS Statistical Software and file interrogation tools such as IDEA. Preparation of performance audit report Experience shows that it is much easier to produce a good audit report if auditors develop a report outline first. The report outline contains the chapter headings and paragraphs headings for the report. The chapter and paragraph headings communicate the key messages effectively if they are expressed as statements summarizing the audit findings. The chapter headings summarize the key messages for each chapter and the paragraph headings summarize the key messages for each paragraph. Bullet points should go under the paragraph headings to indicate the sub-points to be included in each paragraph. Completing the Report Outline Once auditors are sure that they have sufficient relevant, reliable evidence which answers the audit questions they can complete the report outline and proceed to the report drafting stage. The report outline is the same format as the audit summary form, but without the audit evidence column. The last column contains bullet points to guide auditors on what to include in the report paragraphs for each chapter. Examples of two completed audit report outlines are demonstrated at the end of this chapter. Producing the report outline. The completed audit results form can be used as the basic structure for the report outline. The report outline has a pyramid format. The answer to the main question will point auditors to the title for the audit report. The answers to the main question and second level questions point auditors to what should be included in the Executive Summary. The answers to the second level questions also point auditors to statements for the chapter headings. The answers to the third level questions point auditors to statements for the paragraph headings, and the audit evidence points them to the bullet points within each paragraph. The format for the report outline. There are no strict rules for a report outline but a recommended format is: Executive Summary – answer to main audit question; Chapter headings based on answers to sub-questions; Paragraph headings based on third level questions; Annexes: Audit objectives and methodology; Detailed audit findings; Statistics. Developing the report outline. One way to develop the report outline is for the audit team to meet and work together to develop the paragraph headings for each chapter. The team can then agree the chapter heading which best answers the second level audit question and summarizes the contents of the chapter. The main messages for the executive summary can also be developed, and they should represent the main audit finding and the key points from each chapter. Drafting the Report Once auditors have developed the report outline, they know the basic structure of the report. Each paragraph heading should summaries the main points auditors want to make in that paragraph. They can then complete the text under each paragraph heading. If the chapter and paragraph headings are in the form of statements, the contents page will become a one-page summary of the report findings. Audited body - full report; National Assembly – full report, particularly executive summary; Media and citizens – press notice where appropriate. Auditors need to identify the 3 key messages and make sure that they are communicated effectively in the executive summary the body of the report and the press notice where appropriate. It may be necessary to take another look at the paragraph and chapter headings to ensure that they convey the key messages that auditors want their readers to receive. Drafting Conclusions and Recommendations It is important that audit conclusions and recommendations are: clearly signposted, meaningful and linked to the appropriate evidence. They should address underlying causes of concern, be useful, realistic and cost-effective. Recommendations should take into account any financial, legal, or practical constraints or those imposed by Government policy. If there is a clear solution, the auditors should recommend it. If there are a number of possible solutions, auditors can list them, stating the advantages and disadvantages of each. Auditors need to be sure that the audited body will be able to put their recommendations into practice, so they need to discuss with the audited body how this will be done, what it may cost, and over what time period it can be achieved. If the audited body requires help in implementing audit recommendations, auditors can discuss with it how it should go about getting such help. Review of the implementation of performance audit recommendations All auditors should carry out follow-up checks on the implementation of audit recommendation in order to ensure the effectiveness of the audit. Procedures for performance audit are similar to those for financial audit. The main procedures are as follows: Review of the audited body’s report on implementation of audit recommendations; Inspection of audited body’s procedures to establish whether, and to what extent, audit recommendations have been implemented; Assessment of the effectiveness of the audited body’s implementation of audit recommendations in delivering the outcomes specified by State Audit of Vietnam; Preparation of an audit report summarizing the results of the review and stating any further action that the audited body should carry out. The methodologies used to review the implementation of the audit recommendations will depend on the nature of the recommendations. Audit methodologies will include: Structured interviews with relevant staff from the audited body; Examination of files and documents; Review of systems and processes, including observation of work; Data collection and analysis if appropriate. If the audited body has failed to implement the audit recommendations effectively, the auditors should: Conduct a structured interview with the relevant senior officials responsible for implementation Establish the reasons that implementation was not effective; Agree corrective actions that the audited body will undertake, including dates when implementation will be completed; Produce a record of the interview, including corrective action agreed, and obtain the signature of the senior official, certifying that the record is correct; Include a copy of the record of the interview in the audit report on implementation of the audit recommendations. Performance audit in other countries Supreme Audit Institutions in many countries carry out performance audit. Performance audit is generally interpreted as referring to economy, efficiency, and effectiveness, but different countries interpret this in different ways. Some countries focus on the achievement of objectives. Others focus on developments against past performance, rather than benchmarks of good practice. Differences also appear in the time at which a performance audit can be started. In some countries performance audit work takes place during and after the implementation of a particular program. Other countries permit an examination of a subject as soon as a decision to start a project is taken, or once a policy decision has been made. The system-oriented approach of effectiveness auditing. Public services are complex, and the growing complexity of government programs increases the incidence of conflicting goals and unintentional side effects, caused by overlapping or coinciding functions. Further, most central decisions on public programs must be made without being completely sure that they will attain the stated objectives, at least not at the first attempt. It is not an easy task to turn political goals into government pro- grams and to design and implement measures that will obtain desired results. It may even prove difficult to find suitable methods to assess the results and the effectiveness of government interventions. There is a growing insight that there often is a large gap between what has been decided politically and what will later be implemented and finally achieved. It is therefore essential to develop models to help performance auditors in their efforts to analyze and evaluate the implementation and effectiveness of government interventions. One common approach in performance auditing is the so-called goal-means (aims and methods) model. In this model implementation is seen as a process where general goals are broken down into sub-goals or means by ministries and executive authorities; authorities later being held accountable for how they manage and produce the services. The system-oriented approach to effectiveness auditing, presented below, has it roots in the goal-means model. It is also based on ideas and concepts from ‘system theory’, where government undertakings or programs are seen as systems of interacting and functional inter- dependent elements. Regulations, resources, government bodies etc. are all examples of elements that constitute a system of this type of a government undertaking. Defining a government undertaking as a system means that the performance auditors have to apply a holistic perspective. In auditing effectiveness of such systems, less emphasis is put on the accountability of individual agencies. The focus is on the effectiveness of the systems themselves. The system-model and government undertakings. The system-model is presented below, step by step. Production – the first component in the model. Production is the core of the system-model. In all production of services, production and consumption occur simultaneously. Consequently, clients, staff, working methods and resources are all part of the production system. This is shown in the figure below. Figure 1.6: The system-model type a Clients Staff PRODUCTION Methods Resources (Source: EC-Project) The aim of production is to deliver services to society efficiently. This might, for instance: require motivated and competent staff; rational use of resources; good practices; participating and well-in- formed clients etc. Administration – the second component in the model. The operation of the production system takes place within the frame- work of an administration, involving perhaps several ministries and many departments and agencies, as well as regional offices and local authorities. Figure 1.7: The system-model type b SOCIAL UNDERTAKING PRODUCTION Resource Planning monitoring Allocation And follow-up ADMINISTRATION (Source: EC-Project) The function of the administrative systems – to allocate resources, to plan and implement activities, to monitor and evaluate progress etc– is basically to make it easier to coordinate and control the operations of government undertakings. The administrative systems should contribute to effective implementation of the undertakings. Structural design – the third component in the model. This structural design forms another framework (around the production and administrative systems). The societal undertaking and the concomitant political goals are not the only matters that parliaments and governments decide upon. Other important issues are the structure of the executive organization, budget frameworks and regulations that direct operations in production systems. This is shown in the figure below. Figure 1.8: The system-model type c ADMINISTRATION Resource Planning monitoring Allocation And follow-up STRUCTURAL DESIGN (Source: EC-Project) The environment and the complete system model. Finally, it must be noted that forces in the environment have a bearing on the way a societal undertaking is implemented. Therefore, the complete system model is: Figure 1.9: The complete system model (Source: EC-Project) The system model shows that the actions of government bodies or authorities (departments or agencies) form one of many links in a larger chain of events. A government body must therefore be assessed in the light of other control factors in the form of rules, resources, the organization set up to carry out certain activities, and the social environment in which the individual unit or organization operates. The systems model allows for a wide concept of effectiveness auditing and questions such as: Is the government undertaking well structured? Audits of such issues may involve assessments regarding the regulatory approach, the distribution of responsibilities, or the granting of appropriations etc. Effectiveness auditing – some conclusions. In its effectiveness auditing, the SAI examines the effectiveness and government-financed activities. By that we mean that an examination is made of whether the results are those that parliament and government intended to achieve when they allocated resources, established agencies, and passed legislation to implement a societal undertaking. The model presented above illustrates that this type of effectiveness assessment requires a systems approach. All factors that have a tangible effect on the degree to which the goals are attained must be considered. Otherwise there is considerable risk that in the assessment, for example, the importance of a single agency is magnified. The instruments at the disposal of the agencies may in fact be rather feeble compared to the forces at work in society. An important part of all effectiveness auditing is the assessment of actions and decision-making. Therefore, a simple explanation of possible reasons for failing to attain the established goals is often not enough. The factors that can be influenced must also be identified. The systems model shows that there are two types of factors that can be influenced: The agency’s actions – do the agencies involved perform their tasks in the most appropriate way, seen in relation to the undertaking to be carried out? Structural design – is the body of rules, the appropriation of re- sources and the organization of agencies appropriate for its purpose in relation to the undertaking to be carried out? The systems approach to effectiveness auditing works on the basis of a dual auditing issue. Both the activities of the agency and the structural design are considered in assessing whether or not the operation is effective. Effectiveness auditing may always run a certain risk of gazing blindly at the internal workings of the agency under audit. One does not always notice that a possibly needed tightening up of routines and planning procedures can be of lesser importance in terms of the impact on real effectiveness. Strong criticism may sometimes be leveled, without noting that the agency’s activities are limited by the fact that its resources are far too meager or that it has a weak position in the government administration. By placing the agency in a wider context, the systems approach to auditing counteracts the risk of adopting a narrow view. The intention of the model that has been developed is to clarify the aims of a system-oriented audit. The next question is how to attain that level of ambition. On the basis of the agency’s experience of the systems approach gained in concrete projects, three requirements regarding methods can be discerned: In system – oriented auditing, the operations in a certain area of society are the point of departure. This is expressed by allowing a particular undertaking to form the basis of both the study and the final assessment. In system-oriented auditing, the scope of the analysis is defined in terms of the ‘system’ that is formed by the undertaking itself and the forces/actors that affect the realization of this undertaking. In system – oriented auditing, data on outcome are always included in the basis for analyses and assessments. The purpose of this model is to provide a theoretical framework for effectiveness auditing that takes the government undertaking, i.e., the ultimate effects that the public program/agency is intended to bring about, as its point of departure. Chapter 2: Real situation of Collecting and spending toll fee audit An overview of performance audit and objectives of the State Audit of Vietnam in implementation of the performance audit Objectives of State Audit of Vietnam in implementation of performance audit The goal for audit implementation until 2010 of the State Audit of Vietnam is to serve the Government administration reform program; take priority to implement performance audit for state agencies. Therefore, since 2005, the State Audit of Vietnam has implemented performance audit to do its function and contribute positively to the state administration reform program and public finance reform program. To implement performance audit, the State Audit of Vietnam needs to prepare necessary factors for implementing and setting up professional method; training and developing auditors and chief of auditor group, developing and applying advanced IT into performance audit. Besides, it is necessary to set up a suitable implementation road, basis of summarizing practical experience and developing performance audit theory, suitable with the auditing demand at the end of period 2005- 2015. Expanding Performance audit in State Audit of Vietnam is an objective demand to develop fully the State Audit of Vietnam’s role in social and economic development process. At the same time, it brings about the responsibility for State Audit of Vietnam to innovate the auditing method. Real situation of performance audit of State Audit of Vietnam Up to now, Vietnam has not promulgated any regulations and process of performance audit. The State Audit of Vietnam hasn’t implemented any performance audit independently. The Collecting and spending toll fee audit is a combination of financial audit and performance audit. So, the research of Collecting and spending toll fee audit to improve performance audit process, enhancing effectiveness of Collecting and spending toll fee audit to develop performance audit is necessary. . Requirements and objectives of Collecting and spending toll fee audit When building the audit plan, many meetings, and conversations were organized. Audit association leader, audit team leader, experts are all unanimous are bout the audit objectives. They were specified as bellow: Evaluation the economy, effectiveness and efficiency of Collecting and spending toll fee. Evaluation of the economy of human resources management in Collecting toll fee Evaluation of the efficiency in achieving the target management. Real situation of Collecting and spending toll fee audit Preparation of collecting and spending toll fee audit Collecting data Firstly, the leaders of Collecting and spending toll fee audit association have to setup general audit team. The general audit team has to collect all the data about audited body’s activities to get an overview about audited body’s activities. Information assessment General audit team assessed risk for an audit plan, using typical risks set out in the table below: Table 2.1: Typical Risks Risk Risk Rating The audited body does not have systems to monitor whether State Budget Organizations are meeting objectives, but the evidence suggests that objectives are being met. Medium The audited body does not have systems to monitor whether State Budget Organizations are meeting objectives, and the evidence suggests that objectives are not being met. High The financial audit found that medium-sized part of a significant allocation of budget expenditure could not be fully brought to account, and there was evidence of possible misappropriation. Medium – High A large capital construction project may: cost significantly more than planned to deliver; be 6 months late; not include all the facilities specified. High High High (Source: Performance Audit Guide- EC project) General audit team realized that it was necessary to investigate to get understand the audited body’s systems, and examine the working papers from financial audits which record any weaknesses in the audited body’s systems and operations. Based on research and background information, auditors can identify risks, and depending on the extent of weaknesses and their potential financial or operational impacts, they could rank those risks as high, medium or low. An assessment of the value of expenditure and the likelihood of risk resulted in the following risk ratings: Understanding situation and complication This is the starting point of the audit. This identifies issues arising out of the situation that explain why the audit is necessary. This could involve new government projects, changes in legislation, and concerns about weaknesses in operations or business and financial systems. This stage could take about 2 days, with points again suggested by the audit team, and recorded on a flip chart white-board. Points taken from the COMPLICATION are included in the section of the audit plan covering issues and risks. 2.3.3. Making question Main audit question must be about the economy, efficiency and or effectiveness. They include: Keeping costs low; Making best use of resources; Delivering what government asked for. Here are some main questions: Is the audited body’s purchasing of construction materials efficient and effective? Is the audited body’s internal structure operating efficiently and effectively? Was the new equipment developed efficiently and effectively? The audit sub-questions will direct the main lines of investigation for the audit, and will be reflected in the chapter headings for the audit report. It is important that they cover the main issues identified under the “Complication” heading of the issues analysis. These issues often relate to delivery of the organization’s programs and projects. The issues covered by the sub-questions will depend entirely on what is being audited. Examples of issues for sub-questions include the following: The organization’s ability to monitor its own performance in meeting strategic objectives; Delivery of programs and projects to time, cost and quality, with appropriate monitoring of performance; Meeting the needs of citizens; Risks of fraud; Using modern technology to reduce time spent on labor-intensive operations; Making best use of staff resources – prioritizing deployment and maximizing attendance; Benefits to be obtained from economies of scale – merging operations or centralizing purchasing. Once the audit questions have been produced they can be developed into audit methodologies using the Audit Methodology Analysis table below. It would not be possible to cover all of a State Budget Organization’s operations in one issues analysis. This is why auditors need to go through the process of Situation – Complication – Question, to decide priority issues for the audit. A broader analysis of some of the main operational issues applying to most State Budget Organizations is shown below, to assist auditors in deciding the scope of their review. Designing the performance audit plan A well structured performance audit plan leads to a well focused audit. It provides a logical framework for the audit and assists in project management, helping to ensure the audit is delivered on time and at low cost. In effect it provides a road map to enable auditors to get where they want to go. Implementation of collecting and spending toll fee audit The purpose of the collecting and spending toll fee audit is to answer audit questions about economy, efficiency and effectiveness of collecting and spending toll fee. As auditors satisfied that they obtained sufficient, relevant and reliable evidences, they can analyze their audit findings. It is necessary to organize audit findings in a way that helps auditors to see if they have answered the audit questions. Auditors can use an audit summary form to do this. At the Implementation of performance audit process, auditors collected evidences from people as well as documentary sources, useful information is not always written down and written material can quickly become out of date. Evidence from external stakeholders – such as users of public services and third parties involved in service delivery – can be just as valuable as that obtained from ministries. A worked audit summary form is included as question table below: Table 2.4: worked audit summary f