|Score||Minimum requirements for scores|
30.4. Supreme Audit Institution (SAI) independence
|A||The SAI operates independently from the executive with respect to procedures for appointment and removal of the Head of the SAI, the planning of audit engagements, arrangements for publicizing reports, and the approval and execution of the SAI’s budget. This independence is assured by law. The SAI has unrestricted and timely access to records, documentation and information.|
|B||The SAI operates independently from the executive with respect to procedures for appointment and removal of the Head of the SAI, the planning of audit engagements, and the approval and execution of the SAI’s budget. The SAI has unrestricted and timely access to records, documentation and information for most audited entities.|
|C||The SAI operates independently from the executive with respect to the procedures for appointment and removal of the Head of the SAI as well as the execution of the SAI’s budget. The SAI has unrestricted and timely access to the majority of the requested records, documentation and information.|
|D||Performance is less than required for a C score.|
Dimensions 30.1, 30.2 and 30.3: Last three completed fiscal years.
Dimension 30.4: At time of assessment.
Reliable and extensive external audit is an essential requirement for ensuring accountability and creating transparency in the use of public funds. While one dimension of the indicator is focused on the independence of the external audit function, the first three dimensions focus on audit of the government’s annual financial reports. Inclusion of certain aspects of a performance audit would also be expected of an audit function, but this is covered in dimension 8.4.
Dimension 30.1 assesses key elements of external audit in terms of the scope and coverage of audit, as well as adherence to auditing standards. The scope of audit indicates the entities and sources of funds that are audited65 in any given year and should include extrabudgetary funds and autonomous agencies. The latter may not always be audited by the Supreme Audit Institutions (SAI), as the use of other audit institutions may be foreseen. Where SAI capacity is limited, the audit program may be planned by the SAI in line with legal audit obligations on a multi-year basis in order to ensure that high priority or risk-prone entities and functions are covered regularly, whereas other entities and functions may be covered less frequently. Audit work should cover total revenue, expenditure, assets and liabilities, regardless of whether these are reflected in financial reports (see PI-28).
Adherence to auditing standards, such as the International Standards of Supreme Audit Institutions (ISSAI) and the IFAC/ IAASB International Standards on Auditing (ISA)76 , should ensure a focus on significant and systemic PFM issues in reports, as well as conducting financial and compliance audit activities, such as providing an opinion on the financial statements, the regularity and propriety of transactions, and the functioning of internal control and procurement systems. The SAI should implement a quality assurance system to assess whether its audits adhere to the adopted audit standards. These reviews are generally internal to the SAI, though independent of those carrying out the audits, but external bodies may also play a role in
6 i.e., fall within the implementation of the overall risk-based audit plan of the external auditor for the given year, regardless of whether or not the plan requires substantive audit work to be carried out on that entity/fund.
7 The ISSAIs on financial audit are based on the corresponding ISAs, which guide the conduct of the audit of financial statements, including related compliance audit requirements such as consideration of laws and regulations in an audit of financial statements.