External audit

Internal audit function

Integrated into the internal audit and business divisions, regional bureaux and country offices, the quality assurance function complements internal and external audits in the following ways

The working group fully supported the resources requested for external audit ( 479,900) and internal audit ( 1,240,700).

(d) Enhancement of the external audit functions of the Fund and expansion of the Fund's internal audit coverage

Follow up of the recommendations made in prior external audit reports

Enterprises should disclose the scope of work and responsibilities of the internal audit function, as well as the highest level within the leadership of the enterprise to which the internal audit function reports.

(d) Assessing the adequacy and effectiveness of internal and external audit services

(i) To consider the effectiveness and objectivity of the external audit process

UNICEF will issue guidance on the follow up of external audit recommendations.

Enterprises with no internal audit function should disclose the reasons for its absence.

This evaluation will also prepare the UNHCR Audit Service for the external audit envisaged by the United Nations Board of Auditors.

Given the potential variation in the internal audit function among enterprises, it is recommended that relevant details of this function be disclosed.

In paragraph 272 of the report, UNFPA agreed with the Board's recommendation that it (a) develop an internal audit charter detailing the purpose, authority and responsibility of the internal audit function and (b) educate personnel about the functions and positive impact of an internal audit function.

In paragraph 272, UNFPA agreed with the recommendation of the Board of Auditors to (a) develop an internal audit charter detailing the purpose, authority and responsibility of the internal audit function and (b) educate personnel about the functions and positive impact of an internal audit function.

All publicly owned enterprises are subject to external audit and accounts are published.

The office of the Director also coordinates the reviews of the internal and external audit functions and ensures the implementation of audit recommendations.

(viii) Identify appropriate key performance indicators for the performance management of external audit services

This provides an overview of the tools and processes in place to analyse, track and manage external audit recommendations and corporate audit issues at UNDP.

External audit welcomes this initiative to modernise the procurement system, which should carry significant benefits.

These include the implementation of a web based audit recommendation tracking dashboard (http audit dashboard.undp.org) to manage corporate audit issues, and the establishment of a quality assurance function within the Bureau of Management (BOM) to analyze systemic issues arising from audit observations.

The United States delegation wondered whether the lower estimated cost of external audits by the Board of Auditors reflected reduced audit coverage or better audit efficiency.

An external audit was something completely separate from and outside the management structures of an organization.

This recommendation is related to the recommendation of paragraph 195 of the 2004 External Audit Report.

It is worth noting that even the organizations that do not have an institutionalized audit committee have set up mechanisms to review internal and external audit matters as well as progress made in implementing audit recommendations.

(ii) Audits facilitation of internal and external audits and follow up on the implementation of audit recommendations

Following previous external audit recommendations on this matter, UNHCR has introduced a new policy on audit certification for implementing partners which will affect projects as of 1 January 2004.

The audit committee should play a role in establishing a policy on purchasing non audit services from the external auditor this policy should be disclosed along with an explanation or assessment of how this policy sufficiently ensures the independence of the external auditor (FEE, 2003a).

The status of the implementation of external and internal audit recommendations was reported regularly to the Oversight Committee.

Under the cost sharing arrangements, it is estimated that approximately one half of external audit costs are expended on the audit of administrative operations and one half on investment operations.

The UNHCR Audit Service works in close cooperation with UNHCR's Inspector General's Office and liaises with the United Nations Board of Auditors to ensure coordination between external and internal audit.

(a) Reviewing the strategy and workplans of internal and, in some organizations, external audit and discussing the scope and content of their audits so as to identify audit priorities and suggesting potential audit areas within which to address the organization's risks

UNHCR planned to invite a representative of the Board of Auditors to attend the review of external audit reports.

Accordingly, most governance codes and guidelines define procedures for enhancing the independence, objectivity and professionalism of the external audit.

The Office of the Comptroller General has proved to be helpful in facilitating the implementation of external audit recommendations.

The reduction in the estimated costs of external audit reflects a reduced provision by the Board of Auditors ( 27,000).

In paragraph 389, the Board recommended that UNICEF issue an instruction on the follow up of external audit recommendations.

Implementation of an audit recommendation tracking dashboard atnc (http audit dashboard.undp.org) and Establishment of a quality assurance function with responsibility for working with country offices and the audit office to address emerging issues proactively, to analyse trends and to address systemic issues.

Finally, Japan applauded the Secretariat for complying with the External Auditor's recommendations and enhancing UNIDO's internal oversight function.

Furthermore, in light of UNIDO's limited financial resources for external audit costs, the Philippines Commission of Audit was ready to modify its proposed audit fee, but without in any way compromising the quality of services Mr. Carague and his team intended to render.

A number of approaches regarding the external audit, such as the need for auditor partner rotation and the avoidance of possible conflicts of interest involved in providing non audit services, can be considered to ensure that external audits serve shareholder and other stakeholder interests in the intended manner.

The group recognized that an effective internal audit function plays a significant role within the corporate governance framework of a company.

OIOS assumes the internal audit function for UNHCR on the basis of a Memorandum of Understanding concluded on 24 July 2001.

(e) Providing an open avenue of communication between the governing board, management and the functions of internal and external audit

The amount of 1,657,900 covers the estimated requirements for external audit ( 462,400) as requested by the Board of Auditors, and for internal audit ( 1,195,500) as requested by the Office of Internal Oversight Services.