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or private sector, every professional body of accountants, whether they are a premier national body, a regional body or global body, any organisation of professional associations, every chamber or institution that engages in policy dialogue, every citizen or stakeholder of this land.
We all have a responsibility to defend and protect the office of the Auditor General. This is because we all have an expectation of the Office of the Auditor General. Public accountability from our own history dates back to King Mahinda in the 10th century AD.
With a 214-year-old past, this institution served the nation in an exemplary manner. Though there were occasional attempts to interfere, the independent role of the Auditor General’s Department was maintained. I wish to gratefully remember those who sacrificed their lives and faced physical harm in the discharge of duties.
Does Sri Lanka match up?
Well-resourced and up-to-date, thus Mr. Speaker the Office of the Auditor General must always be, well-resourced and equipped with the best people. They must be trained, they must adopt the best tools and techniques. They must also be compensated well, to get the best talents available, they must have an attractive remuneration package and must be exposed to countries that have ‘best in class’ practices.
Do we in Sri Lanka match up? Mr. Speaker, I ask, whether we have the required qualified professionals? Do they have all the tools and technique? The equipment and methodologies? What international benchmark of best practice do they adopt?
We adopted better practices 40 years ago; as far back as the early 1970s this country had a Corporations Division, under the Treasury, which monitored the performance of public corporations and statutory boards. This division survived many regimes. Its first Director was no less than P.M.W. Wijesuriya, who was later to become the country’s most revered and respected Auditor General.
The Public Enterprise Department during the regime of President Ranasinghe Premadasa, the Corporations Division was renamed the Public Enterprise Department; I think the Director General was an exceptionally capable woman professional and a Chartered Accountant whom I had the distinct privilege of working with. This Unit made sure that every Government institution or State-Owned Enterprise or statutory board, was externally audited and on time.
The performance of these entities were monitored. The reports of this Unit were feeders for cope.
Mr. Speaker, does this unit exist today? Who or what performs the functions it performed? Do we have qualified and experienced, technically up to date, empowered and independent people in these units which could well support, supplement and complement the Office of the Auditor General? Mr. Speaker, I shall appreciate answers to these questions.
Serious crime
In the discharge of my duties with COPE, I have come across the Auditor General and his staff. I have found them energetic, committed and brave. They highlight very serious breaches of financial discipline.
I am sorry to say that reports of the Auditor General are not taken seriously by some quarters. We have seen gross abuse of funds by some Government departments, provincial councils and local Government institutions. Although highlighted in the Auditor General’s Reports these discrepancies are forgotten after some time without follow through. Some of the queries are not replied nor sometimes no action taken. This is a serious crime. It is here that we advocate strict government surveillance.
Today in the country there is serious waste of public funds, the media has highlighted several instances of extravagant spending of public funds by powerful people. In the name of development we indulge in various projects, wasting enormous amounts of money without a feasibility study or project reports.
In my view it is necessary that the respective ministry secretaries be held responsible for financial discipline covering the institutions falling within their purview. It will also be the duty of the relevant Minister to give him the necessary support and even protection in this regard.
Financial reporting
In the modern world, financial reporting can be done pretty fast. I recall in 2003 the then UNF Government appointed a Cabinet Sub Committee comprised of the Finance Minister K.N. Choksy and Trade Minister Ravi Karunanayake, chaired by me. There were instances then where some of the financial reports were outstanding for over 10 years.
With the assistance of the Auditor General’s Department and using private auditors in some instances all the backlog was cleared and it was possible to present financial reports to the parliament within six to nine months, which is quite an achievement.
We are happy to note that several institutions are falling in to this category at present. I think we must make it mandatory for the submission of accounts within 9 months of the expiry of the financial year, at the very latest.
Similarly those violating financial discipline must be dealt with and made accountable. We are yet to see a settlement of a large amount due to a State media institution. This was on account of election propaganda. We cannot understand why only the ruling party is given this privilege and we insist that if the money is not paid by the political party, the dues must be paid by the high ranking officials who authorised the payment.
Political appointments
It is high time the Government appoints right and qualified people to run public bodies instead of appointing friends, relations or political supporters. To be fair there are several institutions that are being run as models with competent professional management, but there are also few that are completely mismanaged.
We ask the Government to strengthen the COPE and PAC with more power to ensure clean transparent administration of public institutions. We also believe that political appointments to the Board must be screened like in the case of diplomatic appointments.
The time has come to get help. The time has come for us to invite the international organisation of supreme audit, institutions to further strengthen to evaluate the Auditor General’s Department, to determine how well-equipped with people, tools and techniques we are and how effective the Office of the Auditor General is amidst various attempts to obstruct the good work. This Mr. Speaker is not to break or belittle it, but Mr. Speaker to build it upwards and to make it more responsive to its statutory mandate.
Vinod Rai
In this context Mr. Speaker it may be useful to hear what Vinod Rai, former Comptroller and Auditor General of India had to say about Intosai, this very month, July 2013, in the International Journal of Government Auditing. As someone who believes in good governance, transparency and accountability, I try my best to keep abreast of developments in this field.
Vinod Rai says, and I quote: “I recently completed my term as Controller and Auditor General of India. Building on the foundation laid in Lima and its reiteration and consolidation in Mexico, Intosai has emerged as a champion of the independence, of supreme audit institutions. Today, it is recognised as the leading standard-setting body in the field of public audit.
Examples of Intosai’s growing stature and confidence include formulating auditing standards and guidance on best practices for good governance; building a partnership with multilateral International donors and national development agencies to promote capacity building in supreme audit institutions in need of such efforts; and having the United Nations adopt a General Assembly resolution acknowledging the main principles of the Lima and Mexico declarations and recognising the role of supreme audit institutions in promoting the efficiency, transparency and accountability of public administration.
“These developments also underscore the fact that Intosai is a catalyst in a paradigm shift in the way public audit is perceived today and its relevance to modern societies is demonstrated. In a few months, Intosai will be adopting a standard that asserts the values and benefits of supreme audit institutions. Roles that require auditors to express an opinion about whether financial statements were free from material misstatements. While this will continue to be a key role for all auditors, the increasing complexity in governance today and the demand for greater accountability place an onerous responsibility on auditors.
“Our minds are occupied as never before with questions about whether we have obligations beyond those achieved by traditional audits, whether governance is actually improving the lives of our citizens and whether public policy and programs are responsive to the needs of those for whom such programs are intended. Intosai is now engaged in bridging the gap between the rhetoric of good governance and the actual practice thereof.” End of quote from the International Journal of Government Auditing.
I believe, Mr. Speaker, we can take a lesson from these wonderful words of Vinod Rai, former Comptroller and Auditor General of India, from that land of the Mahatma, our friend and neighbour, India.
