This document provides guidance for accounting officers on responding to audit queries and appearing before the Public Accounts Committee (PAC). It outlines stakeholders' responsibilities under the financial regulations to address audit queries promptly. It describes potential penalties for failing to respond satisfactorily or crossing the "red line," such as dismissal. The document advises accounting officers to maintain positive relationships with auditors, respond openly and honestly to queries, and provide all required documentation to defend their positions before the PAC. It includes tips for proper documentation, log analysis, and decorum during a PAC appearance to avoid sanctions like arrest, prosecution or executive orders.
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Staying Out of Audit Trouble: A Guide to Handling Queries and PAC Appearances
1. Staying Out of the Audit Query
“Red Line”:
What You Need to Know
2. Stakeholders’ Responsibilities
and Audit Query Implications
Financial Regulations (FR)
Prescriptions/Penalties
Crossing the ”Red Line”… and
PAC Interventions
PAC Appearance, MDAs’ Team and
Defense…What Every Accounting
Officer should Know
In this
discourse
3. 3
Stakeholders’
Responsabilités
and Audit Query
Implications—
FR114
- FR 114 requires the sub accounting officer
(Head of Finance and Accounts) to ensure “the
existence of an effective Audit Query
unit/section to promptly deal with all queries
from Internal Audit Unit, Inspectorate
Department, Office of the Accountant-General,
Office of the Auditor-General and Public
Accounts Committee”
4. 4
Stakeholders’
Responsabilités
and Audit Query
Implications—
FR114
Failure to give satisfactory explanations to an audit query
attracts sanctions
FR 3102 – Inflation
of contract – 5 days
– removal from
post/ dismissal of
AO
FR 3103 -
Unauthorized
variation of
contract(s) and
procurement – 21
days to address –
dismissal
FR3104 – payment of
money to a contractor
for a job not executed:
refund the money,
removal from office,
referral to the EFCC
for prosecution
FR 3105 - Poor
quality work
carried out by a
contractor – 42
days, etc.
5. 5
Issues with Reports
of the OAuGF
and Internal
Dimensions
Audit reports
not released
to the public
on time
As of 2018 the
NASS has not
finalized any
PAC
recommendation
since 1999
Public
accounts
committees
not effective
As of
2017/18,
Audit
reports not
released to
the public
for up to six
years
As of today, 2018/2019 are still in areas
6. International
Dimensions—Ghana
and Rwanda in
Perspective
6
Audit reports released on time, no arrears, see
www.oag.gov.rw (Rwanda) and
www.ghaudit.gov.gh (Ghana) for all recent
audit reports of these countries
Proceedings of
PAC televised live
Recommendations publicized,
sanctions enforced, offenders
known, named and shamed publicly
PAC review of audit
reports:
Rwanda up to date
Ghana – one year
in arrears as of
2018
In Ghana
and
Rwanda
7. 1
2
3
4
5
Know the AG and the audit Team
Ensure positive and cordial relationship
Listen and adhere to audit requirements more efficiently
Designate and official for the whole process
Establish clear line of communication
Before The Auditor-general—Crossing the “Red Line”
Issues with Audit
Query Responses—
Accounting
Officers Crosses
the “Redline”
8. Before The Auditor-general—Crossing the “Red Line”
6
7
8
9
10
Respond to informal queries promptly and efficiently
Provide information as required and inform the auditors if
not available
Have an open office approach and assist as
far as possible
Be as honest and possible, likewise ensure
you follow all ethical rules in dealing with the
OAuGF team
As much as possible, Do Not Cross
the “Red Line”
Issues with Audit
Query Responses—
Accounting
Officers Crosses
the “Redline”
10. Team composition
Accounting Officer
Head of
Procurement
Any other
Officer (SME)
Any other
Officer (SME)
Director of Accounts
and Finance
Appearance
Before The
PAC
11. Achieving Proper
Documentation
For A PAC Defense
Nature and types of
documents
Document Log
analysis
Document Quality Control
Document authenticity
and Accuracy
Document References
12. Nature and types of
documents
Accurate figures
Accurate
tabulation of
figures
Completeness
and accuracy
required
Proper item
classifications
and accuracy
A checklist of
banks, accounts
classification, and
periods
Achieving Proper Documentation
For A PAC Defense
Appearance
Before The
PAC
13. MDA….
Unit
Schedule
DOCUMENTS LOG REMARK
S/N CATEGORIES Received SUBMITTED In Process
1
VAT credit notes Not Existing
2 WHT deductions √ 2009 √
3 Budget Report from 2000 to 2015 x
4 Schedule of receipts from √
5 Strategic Planning Reports x
6 Schedule of budgetary allocation from Federation Accounts √ x
7 Schedule of Grants and subventions √
8 Schedule of other revenue from √
9 Schedule of Capital Expenditure from 2001 to 2015 √
10 Payment vouchers x
11 Nominal Ledger x
12 Schedule Retirements √
13 Fixed Assets Register 2007 to 2015 √ 2015 √
14
Payroll File 2007 to 2015 √ 2007,08 & 09 √
15 Operations Manual √
16
Auditors Management Report 2007 to 2015 (Mgt Letters) √ 2007/2011 √
Document Log
analysis
14. Document Log
analysis
##
#
Bank and Cash
A Current Account
- Bank reconciliation statements for all the bank accounts
- Individual bank ledger accounts
- Individual bank statements √
- Names and addresses of bank accounts with circularisation
B Fixed Deposit
-Schedule of placements with banks with its offer letter and roll over letter where
applicable ?
-Schedule of placements with other financial institutions with its offer letter and
roll over letter where applicable
C Bank Loan & Overdraft
- Loan obligation categorized into short and long term loan ?
- Offer letters and roll over letter where applicable
15. Ethics and Integrity of
CAO and Appearance
Decorum
--A few Dos and Don’ts
If possible
request for
time to get
the
informatio
n required
to clear
your query
Do seek
clarifications
on questions
asked
Don’t get
ruffled and
confused
Present your
case as
intelligently
as possible
Don’t argue
unnecessarily
1
2
3
4
5
17. Orders for
arrest may be
made
Order for
recoveries
Other executive
orders
Recommendation to
law enforcements
Recommendations
to the House for
other sanctions
Any other
disciplinary action
Queries not cleared
18. In Conclusion
..and get cleared
Do your homework
Appearance before the PAC
Stay out of the “Red Line”
Engage the Auditors more professionally