Risk Management Internal Audit Not For Profit

1. MBA Degree Research
Rovena Kokoshi
September 2014
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2. 2
 Risk Management
 Accounting
 Internal Control

3. Which are/is
 WFP/UNHCR Somalia IA and Accountability elements that count in RM
 Risk categories. Their range of intervention in WFP/UNHCR performance
 Som. managers opinion about IA/Acc/RM contribution to Org Fin.net worth
 Org. objective influence in the WFP/UNHCR organization risk appetite
 Managers preferable approaches to measurement and risk quantification
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4. Refuges 1,037,554 East Africa
IDP 1,100,000
2300 other nationalities refugees
UN Internal
Audit
Rules + IIA
Rules
WFP
Somalia
UNHCR
Somalia
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5.  General insecurity
 Repatriation process interrupt
 Lack of banking system /money vendor Dahabshil
 Local authorities often not in line with humanitarian projects /activities
 Difficulties on assuming national staff /clan related /competencies
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6.  Different Mission
 Financial net worth different
 IPSAS 2008/2012
 Risk Management 2005/2008/2006/2012
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 2005/lack of :
 Clear guidance to staff
 Distribution of skills &
responsibilities
 horizontal communication
 2013
 Risk trend analysis
 IA and Acc Standard
Compliance
 Financial risk frameworks
 WfP policies to manage risk /no
guidance to implement them
through org

7.  Time frame longer than other
investment
 Partial Monitoring system
 IA in field offices incomplete
 Partial use of Authority of
delegation / Standard Operation
System
 Difficulties to indentify local
partner
 Difficulties to reach all regions
 Tender procedures outside
 IPSAS/expenses/inventories
 Risk Assessment infancy period
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8. Different scales of risk estimations
 Institutional risks
 Contextual risks
 Programmatic risks
 Lower partner capacity
 Insufficient investments
 Gaps policies/practice
 Insecure environment
/uncertainty
 Funding environment
 Multiple emergencies
 Program design not optimal
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9.  IA/Acc/RM direct impact on organization financial net worth involving
organization credibility and operational results
 Independently of risk degree, Risk appetite goes parallel with
organization’s core objectives
 Org. Risk exposure quantification is at level zero
 Internal competition between Un agencies generates contradictory
tendencies towards local government authorities’ relationship
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10.  INSTITUTIONAL
 CONTEXTUAL
 Transfer purposes - lower partner capacity
 Providing results with lack of systems-
monitoring management gaps
 Gaps in Policies and Practices
 Funding Lack – donors/ admin cost
 Insecurity level and uncertainty- divers R.
App
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11.  PROGRAMATIC
 Overextended in multiple emergencies
 Program design not optimal
 Inflations scale
 Misbalance R. APP/ Fin R.Capacity
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12. UNSAS IPSAS
 Modified cash basis
 Purchase orders are dispatched
 Voluntary contributions are
considered revenues prior to
receipt of cash
 Assets are considered
expenses upon purchase
 Employee benefits recognized
on cash basis
 All liabilities not reported on
financial Statements
 Accrual basis of accounting
 Transactions and events are
recognized when they occurred
 Rev. are considered when
enforceable agreements are
signed/may differ revenue
recognition
 Assets are capitalized with all
associated cost/ depreciation
considered
 Employee benefits recognized
when they’re earned
 Distinguish short term/long
term benefits
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13.  Increase accountability and transparency in financial donor reporting
 Same basis of financial reporting as most of Member States
 Consistent information on organization financial wealth and health
 Better understanding of future obligations and cash flow and needs
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14.  All offices manage their assets. More accurate accounts of assets/
decrease qualification by auditors
 Units responsible for self monitoring/ Internal control increase
 Risk Register helps Management decision
 Risk will be dynamic and responsive to contextual changes
 Audit capacity development should be tailored to the situation
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15.  Increase information shearing between sibling agencies/
implementing partners
 Co-sourcing of auditors
 IPSAS training to the new staff /medium- long term perspective
 Partners and contractors selection decision to be made by regional
bureau
 More transparency towards donors
 Balance operational strategies with permanent critical risks
 The creation of a corporate fund covering unexpected emergencies
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