THE SOUTHERN AFRICAN JOURNAL OF ACCOUNTABILITY AND AUDITING RESEARCH VOLUME 9: 2009   CONTENTS The development of practical experience requirements for Registered Government Auditors in South Africa Internal audit in the federal organizations of Malaysia: Is there light at the end of the long dark tunnel? The experience of accountancy departments at South African universities in appointing black, coloured and Indian chartered accountants in academia Towards performance budgeting The audit expectation gap in Malaysia: an investigation into its causes and remedies ABSTRACTS The development of practical experience requirements for Registered Government Auditors in South Africa (JD Gloeck & H de Jager) The Registered Government Auditor (RGA) functions in the specialised public sector audit environment and therefore requires specific audit competencies. Professional competence rests on three main pillars, being knowledge, skills and attitudes. The latter two are specifically developed by working as a member of an audit team in a professional environment. Whilst the Common Body of Knowledge and Skills for RGAs (COBOKS for RGAs), published by the Southern African Institute of Government Auditors (SAIGA) in 2000, focuses mainly on the academic requirements to qualify as a RGA, SAIGA, as custodian of the government auditor qualification (RGA), is also expected to determine detail practical experience requirements for RGAs, also referred to as Government Auditing Experience (GAE). Apart from a few basic requirements regarding the period of practical training (for example, prospective RGAs have to gain four years of practical experience), the COBOKS for RGAs contains no detailed guidance as to specific experience requirements during these four years. In 2007, following a request from the Auditor- General, SAIGA proceeded to develop detailed guidelines and regulations which would have to be met by trainee auditors (prospective RGAs) during their period of GAE. SAIGA subsequently commissioned a research team to steer the development process from its research phase to the finalisation of the official institutional GAE publication. This developmental process and the final product thereof form an important part of the historical development of government auditing, government auditing standards and the professionalisation of the government auditor in South Africa. This article places the GAE within a professional auditing context, describes the GAE development process from 2007 to 2008 and records the final Government Auditing Experience requirements for Registered Government Auditors as published in 2008. [ BACK TO THE TOP ] Internal audit in the federal organizations of Malaysia: Is there light at the end of the long dark tunnel? (A Md Ali, A Ahmi, A Ali, JD Gloeck & MZ Ghazali) Internal audit is supposed to help members of organizations to improve their business activities. But the findings from in-depth interviews with internal auditors from a total of 40 federal government ministries, departments and agencies in Malaysia, conducted in the middle of 2004, have revealed a number of serious shortcomings. Most notable of these shortcomings are that many internal audit units have a shortage of staff, and that the audit staff lack internal audit skills. In addition, a majority of the audit units still employ outdated audit practices, and have failed to get the right level of support and assistance from the Treasury. Worse still, their operational effectiveness and efficiency is threatened by the high-handed conduct of the National Audit Department which arbitrarily and unilaterally shuffles staff between the body and internal audit units. With national and pubic sector surrounding leaving much to be desired for in regard to transparency and public accountability of the major actors and the fact that Malaysia is a large power distance society, it may not be too far fetch to expect the internal audit quagmire to continue to take place into the foreseeable future. The experience of accountancy departments at South African universities in appointing black, coloured and Indian chartered accountants in academia (LP Steenkamp) Universities are under pressure to diversify the ethnic profile of their academic personnel. In spite of the fact that accountancy departments are not exempt from this pressure, black, coloured and Indian chartered accountants remain under-represented in these departments. A questionnaire was distributed to the heads of academic accountancy departments offering chartered accountancy programmes to ascertain the cause of this under-representation. The findings from the questionnaire indicate that few applications from black, coloured and Indian chartered accountants are received for positions in academia and the consensus is that this can be ascribed to the fact that salaries in academia are too low and are uncompetitive with those offered by positions outside academia. The situation is exacerbated by the small pool of candidates, i.e. the low number of black, coloured and Indian chartered accountants in the profession world-wide, and more so in South Africa. [ BACK TO THE TOP ] Towards performance budgeting (JI Nkoana & P Bokoda) As a way of improving financial management and accountability, South Africa introduced the Public Finance Management Act, Act 1/1999, as amended by Act 29 of 1999 (PFMA). Within this Act is an implied accountability approach to financial management that has led South Africa to adopt a result- orientated or performance based budgeting process, with more emphasis being placed on service delivery outputs. Used alongside departmental spending plans, this approach provides a basis for assessing whether public spending represents value-for-money, and for determining if it is aligned with government objectives. The progress is evident when examining the changes made to the structure of the national budget document and those of government departments, provinces and eventually municipalities and enterprises, and the kind of reporting reqirements imposed on thee accounting officers (National Treasury 2001 and 2006). The South African budget structure has evolved from simply showing traditional line items to the point where it now shows programmes, sub programmes and performance targets within a standard chart of accounts. Although performance targets (outputs) form part of the budget in South Africa, there are no resources directly allocated to these individual performance targets. Instead, resources are allocated at programme level to a basket of outputs for that programme. The lack of rigorous resource allocation to individual outputs makes it difficult to calculate unit costs of service delivery outputs. The audit expectation gap in Malaysia: an investigation into its causes and remedies (TH Lee, A Md Ali & JD Gloeck) Increased litigation and criticism of auditors has left little room for doubt that auditors are facing a liability and credibility crisis. The auditing profession has named this problematic issue the “audit expectation gap”. To complement the previous study of Lee et al (2007), this study aims to investigate the causes of the audit expectation gap in Malaysia. 35 semi-structured in-depth interviews were conducted. This study found that the causes of the audit expectation gap in Malaysia are complicated. They arise from a combination of misconceptions or ignorance on the part of users, the complicated nature of the audit function, unreasonable expectations, inappropriate legislation, and under- performance by auditors due to reasons including “low balling” and unreasonable audit fees amongst others. This study draws on these findings and proposes various remedies that may help to bridge the audit expectation gap in Malaysia. [ BACK TO THE TOP ]
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