Strengthening Internal Audit Functions in County Governments
In an initiative aimed at enhancing the internal audit functions within County Governments, the Public Sector Accounting Standard Board (PSASB), in collaboration with officials from the County Governments, is developing county audit programs that will enhance the efficiency and efficacy of Internal Auditors working in the County Governments.
A recent diagnostic review conducted across 27 out of the 47 county governments revealed significant capacity gaps in areas such as performance management and accountability – a reason why the program is being developed. The finding highlighted that a majority of counties, approximately 86%, have yet to adopt a risk-based internal audit approach. Moreover, the critical gaps identified were inadequate documentation of internal audit work, lack of investment in automated tools, and absence of sufficient documentation of audit programs.
To address these challenges, PSASB has introduced County Audit Programs to standardise internal audit processes, promote effective audit functions, and ensure compliance with the International Professional Practices Framework.
“These guidelines will enhance audit planning and execution in the county governments by providing evidence of audit planning. It also outlines the audit processes to be followed by the county governments in their routine audit operations,” PSASB Director, Internal Audit, Mr. Edwin Tito said during a workshop in Naivasha.
The guidelines emphasise the importance of meticulous planning in the audit process and provide a structured framework for developing audit programs. By outlining detailed audit steps and procedures, these programs facilitate the execution of various audits, ensuring adequate coverage of the audit scope and alignment with audit objectives.
Furthermore, the guidelines underscore the benefits of standardized audit work programs, including improved audit planning, enhanced understanding of audited units, methodical execution of audit tasks, and evidence of audit completion. Additionally, these programs serve as a valuable training tool for new auditors, enabling them to familiarize themselves with audit procedures and objectives.
The risk-based methodology recommended in developing audit programs involves a systematic approach to identifying risks, assessing controls, and designing tests to evaluate control effectiveness. By incorporating international standards for the professional practice of internal auditing, the guidelines are hoped to enhance the quality and consistency of audit processes across County Governments.
The scope and application of these audit programs extend to all internal audit functions within County Governments, including departments and agencies. By embracing these guidelines, County Governments are poised to strengthen their internal audit functions, promote accountability, and ensure effective governance structures for sustainable development.