I.M.F. concerns over lack of activities with internal audits

The International Monetary Fund has criticised the way internal audit programmes are conducted, a lack of reporting and a list of comprehensive audit recommendations in a new report into the Samoa Government's public finances. 

The I.M.F.'s July Public Expenditure Financial Accountability Assessment (P.E.F.A.) report says the internal audit has been an active function for several years in the Ministry of Finance and other agencies and provides comprehensive coverage for central government. 

The Internal audit is authorized through the Public finance management Act (P.F.M.A.) and the Public Bodies Performance and Accountability Act 2001. 

“The P.F.M.A. outlines the responsibilities of Heads of Departments which include the establishment of putting in place a system for effective internal control and effective internal audit. 


(covering E.B.U. (Extra Budgetary Unit) the Accident Corporation Commission and other public corporations). 

The report says that internal audit activities of entities are focused on financial compliance. 

“While spot-checks and investigative work performed may be based on risk, the risk appears related to financial activities and areas of non-compliance. For these type of activities, some reporting is based on corrective activity and limited recommendations on actions to improve business processes (other than to identify that procedures should be complied with). 

“For Ministry for Revenue, Ministry of Health and the Ministry of Works, Transport and Infrastructure findings evaluating the adequacy and/or effectiveness of internal controls with recommendations on improving processes were noted. 

The I.M.F. says while annual audit programs exist, no formal records are maintained of planned to actual; reports issued; and details on distribution of reports. 

“Due to work on investigative-spot check activities and pre-audits, discussions with ministries supported a focus for monitoring is the norm, due to a lack of documentation for some ministries and inadequate completion of audit activities.” 

There is no comprehensive list of audit recommendations prepared by internal audit units.

“For some units, a response is included within the audit report, however, follow-up on actual implementation is not tracked through the process. For this dimension, the scoring reflects that “response means that management provides comments on the auditors’ recommendations and takes appropriate action to implement them where necessary. 

Internal audit validates whether the response provided is appropriate.” No validation of the response was noted in any report,” says the report. 


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