MODERN INTERNAL AUDITING IN THE PUBLIC SECTOR

• NCJ Number: 68006
• Journal: Internal Auditor Volume: 35 Issue: 3 Dated: (JUNE 1980) Pages: 79-85
• Author(s): M E AIKEN
• Date Published: 1978
• Length: 7 pages
• Publication Format: Article
• Language: English
• Country: United States of America
• Note: THIS ARTICLE WAS ADAPTED FROM A SPEECH GIVEN TO THE INSTITUTE OF INTERNAL AUDITORS' CANBERRA, AUSTRALIA, CHAPTER

Annotation

THIS ARTICLE DISCUSSES EFFECTIVE STEPS FOR MANAGEMENT CONTROL OF INTERNAL AUDITING IN THE PUBLIC SECTOR BY DEFINING THE RESPONSIBILITIES OF INTERNAL AUDITING MANAGEMENT.

Abstract

ALONG WITH MANAGEMENT CONTROL, INTERNAL AUDITING INVOLVES WHICH FUNCTIONS ARE TO SPONSOR RESEARCH AND EVALUATE IDEAS THAT PROVIDE DIRECTION FOR THE USE OF RESOURCES. IT ALSO INCLUDES INTERNAL CONTROL WHICH CONSISTS OF THE MEASURES THAT GEAR COOPERATIVE EFFORT TOWARD ACHIEVING ORGANIZATIONAL GOALS THROUGH COMPLIANCE WITH EXECUTIVE POLICY. FINALLY, INTERNAL AUDITING INCLUDES FEEDBACK WHICH PROVIDES DECISIONMAKING INFORMATION REQUIRED BY ALL PARTICIPANTS IN THE ORGANIZATIONAL PROCESS. THE GENERAL ACCOUNTING OFFICE FAVORS A COMPLETE AUDIT CONSISTING OF THREE COMPONENTS: FINANCIAL AUDITING WHICH INVOLVES FINANCIAL TRANSACTIONS, ACCOUNTS, AND FINANCIAL REPORTS; MANAGEMENT AUDITING WHICH IS CONCERNED WITH THE EFFICIENCY AND ECONOMY WITH WHICH RESSOURCES ARE MANAGED AND CONSUMED; AND PROGRAM AUDITING WHICH INQUIRES INTO THE RESULTS OR BENEFITS ACHIEVED BY THE ORGANIZATION AND WHETHER PROGRAMS ARE MEETING OBJECTIVES. THE INTERNAL AUDITOR IN GOVERNMENT IS CONCERNED WITH REGULARITY, ACCURACY, AND RELIABILITY OF SYSTEMS AND INFORMATION; ECONOMY AND EFFICIENCY; AND EFFECTIVENESS IN MEETING KNOWN OBJECTIVES. THE AUDITOR SHOULD FOCUS ON THE GENERAL INDICATORS OF STRENGTHS AND WEAKNESSES IN MANAGEMENT CONTROL. WEAK MANAGEMENT INCLUDES THE INABILITY TO MAKE DECISIONS, FAILURE TO COORDINATE ACTIVITIES AND RECOGNIZE AND SOLVE PROBLEMS, FEAR OF DELEGATING RESPONSIBILITY, INABILITY TO MOTIVATE STAFF, AND LACK OF VISION AND IMAGINATION. THE RESOURCES OF INTERNAL AUDIT, EXTERNAL AUDIT, AND INVESTIGATING AGENCIES SHOULD BE COMBINED FOR LASTING BENEFITS. OVERALL, MODERN INTERNAL AUDITING MAKES USE OF CONTINUOUS APPRAISAL OF THE ORGANIZATION AND AN INTIMATE KNOWLEDGE OF OBJECTIVES, POLICIES, AND PRACTICES OF GOVERNMENTAL DEPARTMENTS. FOOTNOTES ARE INCLUDED. (JLF)