Internal auditors are becoming more important to the functioning of institutions but in Guyana their development is being stymied as most units are understaffed and underpaid, according to Chairman of the Guyana Chapter of the Institute of Internal Auditors (IIA-Guyana) John Seeram.
Seeram told those present at the opening of a two-day IIA-Guyana seminar last Wednesday at the Regency Suites in Georgetown that the focus of internal auditing has extended beyond the accounting and financial functions of an entity to other functional areas, such as engineering, information technology and management, among others.
“[It] is designed to add value and to improve on an entity’s operations,” he noted, before adding that these developments mean that internal auditors have serious challenges ahead, which might prove difficult to cope with since they are yet to attain the required quality assurance standards.
Seeram stressed that while some auditing units in the private sector are making every effort to attain the required standard, there are many in both the private and public sectors which are a distance away because in some cases they know little about the IIA’s international standards.
Additionally, he posited that the members of these units cannot analyse and interpret management reports and financial statements, such as statements on the entity’s financial position, its net income, and its cash flow.
He explained to Sunday Stabroek that the ability to analyse this information allows the unit to create and consistently manage performance indicators.
“If you cannot fully understand these statements, how can you make meaningful decisions?” he questioned.
In his presentation, he further noted that several units do not adhere to the institute’s Code of Ethics, its Mission Statement and its Definition of Internal Auditing and are not communicating their reports to management in accordance with the institute’s pronouncement on Communication Standards.
“The auditors’ independence, as required by the IIA’s Standards are questionable, as an example there are no Audit Committees and if they are it is not properly constituted and the reporting line of communication is not being adhered to,” Seeram explained.
However having identified the issues plaguing the profession, IIA-Guyana is focusing on having more outreach meetings with the management of both private and public sector organisations, with emphasis being placed on having intensive and relevant on-the-job training geared towards the institute’s international standards and current best practices and the existence of audit committees to which the audit units report, among other things. The members of this committee must not be operational, must be adequately qualified and aufait with their entity’s operations, Seeram said.
Additionally, he noted that ensuring that units are adequately staffed with persons in possession of required qualification and skills and who are properly remunerated is an aim of IIA-Guyana, which continues to stress that encouraging staff to obtain certification as auditors should be the focus rather than Association of Chartered Certified Accountants qualifications. “Continuing professional development for internal auditors in order to enhance their knowledge, skills and other competencies requires that adequate funds be budgeted, especially for short and medium term training of staff on the job,” Seeram stressed.
