Before proceeding with today’s article, I refer to the comment by parliamentarian Juan Edghill in connection with the forensic audits being conducted at various government agencies and departments. The Government had correctly stated that the auditors do not need practicing certificates from the Institute of Chartered Accountants of Guyana because the audits do not require expressions of opinion on the financial statements of the concerned entities. Mr. Edghill, however, contended that “…yet every day we are being treated to an opinion or recommendation being reported in the press”.
Every entity (whether incorporated under Company Law or by specific legislation) has to appoint external auditors whose responsibility it is to audit the annual financial statements prepared by management and to express an opinion of their truth and/or fairness in compliance with applicable laws, regulations and circular instructions. In contrast, the forensic audits being conducted are not directed towards a set of financial statements. Rather, they are to a large extent managerial in nature, and it obvious that emanating from these audits would be a set of conclusions and recommendations to remedy any shortcomings identified. The forensic audits are not internal audits but are dedicated studies conducted by experts external to the organization. In accordance with Section 4(3) of the Audit Act, the Minister of Finance may request the Public Accounts Committee (PAC) to cause an additional audit to be conducted by an auditor other than the Auditor General. Suffice it to state that at the time the decision was taken to conduct these audits, no PAC was in place.
Mr. Edghill sought to question the competence of Minister Sharma to oversee the forensic audits. While he is not a qualified accountant, Minister Sharma displays a deep understanding of auditing, having worked in the Audit Office during my tenure of office. In my discussions with him on the results of the
