The Internal Audit Agency, GoL
HOW INTERNAL AUDIT HELPS YOU ACHIEVE YOUR DELIVERABLES
Helping you do the right thing in the right way
The Internal Audit Agency, GoL
What is Internal Audit
According to the Institute of Internal Audit:
‘Internal auditing is an independent, objective, assurance and
consulting activity designed to add value and improve an
organization's operations. It helps an organization accomplish
its objectives by bringing a systematic, disciplined approach to
evaluate and improve the effectiveness of risk management,
controls, and governance processes.’
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The Internal Audit Agency, GoL
Perception of Internal Audit
According to a recent world survey by Protiviti, an internal audit, risk
management and consulting firm, the mention of internal audit inspires fear
or assurance:
 fear for those with competence and integrity issues; and
 assurance for those anxious to deliver top quality services efficiently,
effectively and economically
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The Internal Audit Agency, GoL
How Internal Audit is Perceived in the Public Sector
In Liberia, the Internal Audit Agency (IAA) has found that internal audit, or audit for
that matter, evokes:
 anger among those who think they are above the laws governing the public
sector;
 fear among those with integrity and competence issues;
 assurance among those who need comfort that they are doing the right thing in
the right way; and
 hope among those who don't want to get into trouble, and who want to
demonstrate to their staff, the public and critical stakeholders that they are
transparent and accountable.
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The Internal Audit Agency, GoL
Clarification of misunderstanding about internal audit (IAA) and external audit (GAC):
 IAA is different from the GAC, and there are no overlapping functions. Here are some key
differences:
GAC is the supreme audit institution, the external auditor, whose mandate is derived from the
GAC’s Act of 2005 and other legal instruments. GAC’s functions and standards are guided by
the International Organization of Supreme Audit Institution, or INTOSAI. INTOSAI’s guiding
principles clearly state that the internal and external audit functions should coexist, coordinate
and cooperate. ISSAI 1610 provides guidance on how the external auditors should rely on the
work of internal auditors especially if the internal audit function is established by a legislation,
and sufficiently removed from political pressure and management control. Furthermore,
INTOSAI GOV 9150 elaborates the modalities for coordination and cooperation between the
GAC and the IAA. GAC is based outside of the entities they audit and visits periodically for audit
purposes. The GAC conducts post audits, i.e., by CHECKING after the fact; and GAC REPORTS to
the National Legislature and the general public.
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The Internal Audit Agency, GoL
Clarification of misunderstanding about internal audit (IAA) and external audit (GAC):
IAA on the other hand is a management support tool, the internal auditor, based within the entity. IAA’s
mandate is derived from the IAA Act of 2013, and its functions are defined by the Institute of Internal
Auditors (IIA), the global professional coordinating body for the profession.
The IAA reports to the head of the entity and to the President of Liberia. It performs both pre and post
audits; advises and gives assurance; and most importantly IAA supports you by alerting you promptly about
issues/risks and how to correct them thus preventing fraud, corruption, waste and abuse
If the tone from above within any given entity is keen on transparency and accountability, supportive,
cooperative, and accommodative, the IAA is better able to support you in strengthening internal controls,
thereby ensuring efficiency, effectiveness and economy in your operations
Simply put, IAA "helps you do the right thing, in the right way."
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The Internal Audit Agency, GoL
Cooperation and Collaboration amongst Anti-graft Entities
The IAA is part of an effort of collaboration and cooperation with the GAC, LACC, PPCC, etc.
to ensure that public sector entities meet the accountability and regulatory requirements of
the public sector as they execute their respective mandates and objectives.
Since its inception, IAA has conducted four major entity-wide risk assessments across 35
MACs and SOEs. With the risk assessments, you are able to see clearly the health/state of
your entity.
Enterprise or entity wide risk assessments are conducted every six months following the
rotation of Internal Audit Directors to identify opportunities for improvement and to add
value to operations.
Additionally, we have conducted assessments for the Judiciary, the Office of the Senate Pro
Temp, USAID and other development partners.
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The Internal Audit Agency, GoL
Status of IAA’s Rollout
IAA is currently in 40 entities including MACs, SOEs, etc. In January
this year, we rolled out to the Legislative and Judiciary branches of
Government. The IAA’s sole objective is to support senior
management to deliver high quality services fully compliant with
the relevant regulatory requirements thereby avoiding potential
issues that could get you in trouble with the GAC, LACC, PPCC,
GSA, CSA, etc.
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The Internal Audit Agency, GoL
How IAA Supports You in Human Resource Management
 The IAA has supported the removal of more than 200 ghost names from the payroll of
over 30 entities.
 IAA has ensured that all 40 entities have time and attendance records which are
monitored.
 IAA has helped more than 15 entities develop personnel manuals in compliance with
CSA’s requirements.
 Due to IAA’s support, now more than 60% of government’s employees in 30 entities
have files with accurate records as opposed to less than 10% when we first deployed.
 Over 70 staff due for retirement have successfully gone through the process
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How IAA Supports You in Bank Reconciliation
 Due to IAA’s intervention, many entities are now doing monthly bank reconciliation.
Many had not reconciled their accounts in years.
 The head of entity now knows exactly how many bank accounts the entity has along with
the bank balances
 The Finance Departments have been able to close dormant accounts that were accruing
bank charges
 In one, the IAA helped an entity discover and recover over US$80,000 which was
erroneously charged by the bank
 The head of entity/finance head can determine on a monthly basis how many checks
issued were not cashed, cancelled checks, etc
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The Internal Audit Agency, GoL
How IAA Supports You in Procurement Controls
 The IAA ensures that your procurements procedures are in compliance with the PPC
Act
 IAA works with the relevant departments to ensure that all statutory taxes are
withheld from vendors
 IAA counter checks that the goods and services paid for are actually delivered
 IAA works with the procurement department to ensure that all records of
procurement are kept safely, as required by the PPC Act; and so as to avoid suspicion
or accusation that the procurement was fraudulent which is usually the case when
documents are not available to verify
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How IAA Supports You in Asset Management
 IAA has ensured that more than 35 entities either develop an asset register or update the
existing asset register. Ministry of Health and several other entities have succeeded in coding
and registering more than 90% of their fixed assets through internal audit’s support.
 The Internal Auditors have helped entities retrieve assets from staff who took away assets
when leaving.
 IAA is working with the various entities to put in place an efficient method of tracking assets.
 IAA ensures that GSA’s policies on assets is adhered to.
 The IAA advises and supports management in conducting verification exercises periodically.
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The Internal Audit Agency, GoL
How IAA Supports You in Accounting and Budgetary Controls
 IAA has worked with over 30 entities to develop their financial manuals as required by the PFM
law.
 IAA has supported more than 35 entities to develop their petty cash policies.
 In entities where the Finance Department subsumed HR, Procurement, or other functions, IAA
supported management in segregating duties. For instance in many entities, the Finance Dep.
prepares and pays the general allowance listing without the HR’s involvement.
 IAA is supporting the entities to prepare quarterly budget performance reports for submission to
MFDP as required by law.
 The IAA over the last months has been working with MACs and SOEs to prepare IPSAS and IFRS
compliant financial reports.
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The Internal Audit Agency, GoL
How IAA Supports You in Pre-audit of Disbursements
 Internal Auditors check to ascertain that all required documents are attached and signed by the appropriate persons
before payments are made.
 IAA works with the Finance Department to ensure that checks are written in the appropriate names to avoid payments
to third party.
 In cases where liquidation is required, IAA ensures that funds are adequately liquidated before disbursement
 In the case of a contract, the Internal Auditor verifies that the payment are in line with the terms of the contract. In
one instance, a contractor was about to be paid the final installment for completing a building, however, pre -audit
revealed that in fact the building was not completed and the work completion certificate was not authentic.
 IAA also pre-audits the quality and quantity of goods and services before the entities pay.
 Internal Auditors have no authority to block or interfere with management's operations or decisions. Internal Audit is
purely an advisory and assurance function consistent with the definition of internal auditing.
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The Internal Audit Agency, GoL
How IAA Supports You in Focusing on Prior Audit Recommendations
 Internal auditors collate and track the status of implementation of
recommendations from GAC, donors and all external and internal
auditors.
 Internal Auditors work with the various departments concerned
to implement audit recommendations.
 Management is supported by IAA to set realistic timelines for the
implementation of recommendations.
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How IAA Supports You in Validating Your Deliverables
 The internal auditors advise management on the importance of a workplan for all
departments.
 Project implementation is monitored and reported on regularly.
 Internal Auditors work with management to institute system such as setting time
limits on various kinds of documents aimed at making time spent processing
documents more efficient to avoid unnecessary delays, and kickbacks.
 IAA monitors through continuous audits the control environment, giving real time
advice to support senior management.
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The Internal Audit Agency, GoL
How IAA Supports You in Revenue Management
 IAA supports management in blocking revenue leakages and
ring fencing revenue.
 Internal Auditors work with revenue generating entities to
ensure revenue generated is deposited into the general
revenue account.
 IAA strengthens internal controls around revenue collection.
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The Internal Audit Agency, GoL
What Informs IAA’s Support to You
 Annual audit plans informed by risk findings and management's priorities are
developed to support entities.
 Reports are written and addressed to senior management to inform them of audit
issues and recommendations on how to fix those issues before they become a
major hindrance to the achievement of the entity’s objectives.
 A Recommendations Tracker is developed and updated regularly to keep
management informed of outstanding issues requiring management's action.
 A quarter end report is submitted to the President to provide a snapshot of the
state of affairs at the individual entities.
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The Internal Audit Agency, GoL
IAA’s Staff Capacities and Competences
Our personnel come with diverse credentials, but are undergoing continuous professional
development.
We are enrolling our staff into these certification programs of the IIA and the CFE program of the
Association of Certified Fraud Examiners (ACFE).
•
Certified Government Auditing Professional (CGAP)
•
Certified Financial Services Auditor (CFSA)
•
Certification in Control Self-Assessment (CCSA)
•
Certification in Risk Management Assurance (CRMA)
•
Certified Internal Auditor (CIA)
•
Certified Fraud Examiner (CFE)
To achieve this, we are engaging Pearson VUE and Prometric to establish a testing center in Liberia.
We have also submitted proposals to collaborate with LIPA to run training courses at LIPA for
internal audit professionals, and have enrolled a number of our staff in the LICPA/ICAG certification
courses in Accountancy.
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The Internal Audit Agency, GoL
Introduction of a Course on Internal Audit at Universities
Finally, we are planning to engage a number of universities in Liberia
to adopt an IIA approved academic course on internal auditing, so that
university students can have a choice like student in the rest of the
world to study internal auditing as a separate and distinct course.
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The Internal Audit Agency, GoL
Conclusion
IAA is the Government's best opportunity to reverse the culture of systemic
and endemic practice of corruption, inefficiency, and ineffectiveness. Our
approach however is to help you do the right thing in the in the right way.
 Sanction entities that are hindering the work of IAA.
 Reinforce implementation of audit recommendations.
 Designate a focal person in the Office of the President to follow up on
internal audit matters.
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The Internal Audit Agency, GoL
Internal Auditor
The eyes and
ears of
management
Helping you do the right thing in the right way