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Jun 25, 2018
Presentation by G. de Vries (English), Regional Conference for Supreme Audit Institutions of the European Neighbourhood South Region, June 2018
Regional Conference for Supreme Audit Institutions of the
European Neighbourhood South Region
The changing role of Supreme Audit Institutions in the
light of the Sustainable Development Goals
Gijs de Vries
Senior Visiting Fellow, London School of Economics (LSE)
Former Vice-President, Netherlands Court of Audit
20 June 2018
• The Sustainable Development Goals
• Accounting for progress: follow-up and review
• A role for audit institutions?
• Opportunities for SAIs
o Auditing national preparedness
o Auditing financial management
o Auditing SDGs 16 and 17
o Leading by example
• Making a difference
The Sustainable Development Goals
“Transforming our World: the 2030 Agenda for Sustainable Development”
United Nations General Assembly Resolution A/RES/70/1, 25 September
17 Sustainable Development Goals
so that “no one will be left behind.”
“A universal, transformative and integrated agenda that heralds a historic
turning point for our world” – UN Secretary-General Ban Ki-Moon (2015)
Follow-up and review
Global level: High-level Political Forum on Sustainable Development
- at the level of Heads of State and Government every 4 years, under the
- at technical and ministerial level in other years, under ECOSOC
Themes for review
2017: Goals 1, 2, 3, 5, 9 and 14
2018: Goals 6, 7, 11, 12 and 15
2019: Goals 4, 8, 10, 13 and 16
National level: Voluntary National Reviews
- member states invited to “conduct regular and inclusive reviews of
progress” at the national and sub-national levels and present Voluntary
National Reviews (VNR) at the HLPF (Agenda 2030)
22 countries submitted VNRs in 2016, including Egypt, Morocco
43 countries submitted VNRs in 2017, including Jordan, Qatar
47 countries submitted VNRs in 2018, including Bahrain, Egypt, Lebanon,
Qatar, Saudi Arabia, State of Palestine, United Arab Emirates
The role of Supreme Audit Institutions
Why? • Trust is a cornerstone of the social contract between citizens and governments;
• Trust in government requires the public sector to be transparent and
• Supreme Audit Institutions (SAIs) are pillars of transparency and accountability
What? SAIs provide independent assurance to the legislature and the citizens about the
legality, efficiency, effectiveness, and integrity of public financial management
How? SAIs make a difference to the lives of citizens if they:
• strengthen the transparency, accountability, and integrity of government and
public sector entities;
• demonstrate ongoing relevance to citizens, the legislature, and other
• are model organisations that lead by example (ISSAI 12)
INTOSAI “aims to become an authoritative, independent voice on the challenges
facing the global community in planning and implementing the SDGs and reporting
on their progress.” (Abu Dhabi Declaration, December 2016)
Cross-cutting priority: contributing to the follow-up and review of the SDGs
Four objectives for SAIs:
assessing the preparedness of national governments to implement, monitor, and
report on progress of the SDGs, and subsequently to audit their operation and
the reliability of the data they produce;
undertaking performance audits that examine the economy, efficiency, and
effectiveness of key government programs that contribute to the SDGs;
assessing and supporting the implementation of SDG 16 which relates in part to
transparent, efficient, and accountable institutions; and SDG 17, which concerns
partnerships and means for implementation;
being models of transparency and accountability in their own operations,
including auditing and reporting
(INTOSAI Strategic Plan 2017-2022)
How to audit national preparedness?
Has the government set national priorities, baselines, measureable targets, and a timetable to
implement the relevant goals and targets?
Are coherent implementation plans being developed? Have the SDG-related policies been
integrated with other national development plans? Who is in charge of co-ordination?
Responsibilities and budgets
Have political responsibilities and resources been allocated for each of the priority targets?
Are budgets realistic? Will additional funds be required?
Monitoring and reporting
Are arrangements in place for monitoring and reporting on progress in reaching the SDGs?
Will the reports be made public, and is Parliament ready to debate them?
Does the government encourage public awareness of the SDG? Does it stimulate dialogue with
all relevant stakeholders, including the private sector, academia, and civil society organisations?
Is the national statistical agency free to collect and report data without political interference?
Is it able to collect and public complete, credible, relevant, accurate, and timely data?
Are national SDG-related policies implemented well?
How to audit good financial management (performance)?
Effectiveness: on key government targets, are indicators improving, stagnating, or regressing?
Are programs having a clear and positive impact on the quality of life of citizens? Is government
doing the right things, and is it doing things right?
Economy and efficiency: are programs financed at reasonable cost, and implemented within
budgets? Has funding been wasted?
Integrity: have programs and projects been designed and managed to minimize the risk of fraud
The environmental aspects of the Sustainable Development Goals can also be audited in the
context of financial and compliance audit.
SDGs 6 (Clean water and sanitation), 13 (Climate action), 14 (Life below water), 15 (Life on land), as
well as relevant environmental targets under other Sustainable Development Goals
Example: water management
The Middle East and North Africa is the most water scarce region in the world. Over 60% of the
region’s population lives in areas with high or very high water stress. The MENA region has the
greatest expected economic losses from climate-related water scarcity, estimated at 6-14% of GDP by
Relevant SDGs (selection): SDG 6.1, 6.4, 6.5 (water and sanitation); SDG 13.1, 13.3, 13.4 (climate
change); SDGs 1.5 and 11.5 (disaster management)
Possible audit questions:
Are national water resources being managed sustainably and efficiently?
Are water services being delivered reliably and affordably?
Are water-related risks being appropriately recognized and mitigated?
World Bank, Beyond Scarcity. Water Security in the Middle East and North Africa (2018)
Auditing SDG 16
(I) SDG 16 (4) and SDG 16 (5)
SDG 16(4): By 2030, significantly reduce illicit financial and arms flows, strengthen
the recovery and return of stolen assets and combat all forms of organized crime
SDG 16(5): Substantially reduce corruption and bribery in all their forms
Audit questions might include:
Is there a national anti-corruption strategy which includes targets, indicators, and a timetable?
Does the government report publicly on the results obtained? Does it encourage the active
participation of individuals and groups outside the public sector, such as civil society, in the
prevention of and the fight against corruption (Art. 13, United Nations Convention against
Corruption)? Are whistle-blowers protected?
Do the agencies charged with combating fraud and corruption have appropriate mandates,
budgets, and human resources? Do they share information and work together?
• State-owned companies
Does each state-owned company have a system of internal control and internal audit that is fit for
• Political finances
Are political finances sufficiently transparent (parties, elections, ministers, members of
Parliament)? Are transparency requirements being enforced effectively? Are sanctions dissuasive?
Auditing SDG 16
SDG 16(6): Develop effective, accountable and transparent institutions at all levels
Indicator 16.6.1: Primary government expenditures as a proportion of original approved budget, by
sector (or by budget codes or similar)
Audit questions might include:
Does the government report the rate of primary government expenditures by sector in the annual
budget execution report? Are the figures correct?
Does the government publish the annual draft budget and the annual budget execution report on
the internet? Does the government publish a Citizens Budget? Is the annual budget execution
report issued on time, and does the SAI receive it within three months of the end of the fiscal
year? Do budgetary documents reflect national policy on the SDGs?
Auditing SDG 17
SDG 17 (1): Strengthen domestic resource mobilization, including through international support to
developing countries, to improve domestic capacity for tax and other revenue
Indicator 17.1.1: Total government revenue as a proportion of GDP, by source
Indicator 17.1.2: Proportion of domestic budget funded by domestic taxes
Audit questions might include:
Have policies been agreed to improve domestic resource mobilization? Do they reflect the targets
and indicators of SDG 17?
Does the customs administration follow international good practice?
Are taxation policies structured and administered to minimize the risk of losses to the treasury
from illicit financial flows? Has the country joined international initiatives to combat tax avoidance
E.g. WCO, Framework of Principles and Practices on Customs Professionalism (2015); OECD, Integrity in Customs –
Taking stock of good practices (2016)
E.g. Multilateral Convention on Mutual Administrative Assistance in Tax Matters; Global Forum on Transparency
and Exchange of Information for Tax Purposes; Extractive Industries Transparency Initiative (EITI)
Being a model of transparency and accountability
“SAIs only deserve trust if they themselves are objectively judged as being credible, competent and
independent and can be held accountable for their operations. In order to make this possible, they
need to be model institutions (…)” (ISSAI 12)
How can SAIs lead by example?
o Internal governance and ethics
o Audit quality and reporting
o Financial and human resource management
o Communication and stakeholder management
o Effective constitutional framework
o Financial autonomy
o Organisational autonomy
o Independence of the Head of the SAI and its officials
o Including performance audit (economy, efficiency, effectiveness)
o Access to all relevant information (including security-related)
o Right and obligation to report
SAIs are required
to make public their mandate, responsibilities, mission and strategy
to adopt standards, processes and methods that are objective and transparent
to apply high standards of integrity and ethics for staff at all levels
to operate systems of risk-based auditing and of quality control that reflect the relevant INTOSAI
to communicate timely and widely on their activities and audit results through the media,
websites and by other means
to communicate effectively with the Parliament, the government, and other stakeholders
ISSAIs 1, 10, 11, 12, 20, 30, 40; Fundamental Auditing Principles
Building blocks of trust in institutions
– performance and accountability
“The Arab Spring events caught the world by surprise. Standard development indicators failed to
capture or predict the outburst of popular anger during the spring of 2011. What could explain this
(…) people felt stuck (…) and the middle class in particular was frustrated. Measures of subjective
wellbeing and determinants of life (…) show a precipitous decline in life satisfaction scores on the eve
of the Arab Spring, especially for the middle class. These declines reflected perceptions of falling
standards of living, related to the shortage of formal-sector jobs, the dissatisfaction with the quality of
public services, and government accountability. (…) The social contract of redistribution without voice
stopped working. The middle class wanted more – it wanted voice, real opportunities and
Elena Ianchovichina, Lili Mottaghi, and Shantayanan Devarajan, Inequality, Uprisings, and Conflict in the Arab World, World Bank,
MENA Economic Monitor, 2015
N. Spierings, ‘Trust and Tolerance across the Middle East and North Africa: A Comparative Perspective on the Impact of the Arab
Uprisings’, Politics and Governance, 2017, Volume 5, Issue 2, p. 10
Making a difference
By auditing national implementation of the Sustainable Development Goals, Supreme Audit
make a difference to governments (good financial management)
make a difference to parliaments (accountability)
make a difference to citizens (trust)
strengthen the position, performance, and reputation of the SAI