News:  Year 2005: July-September

Bhutan could benefit from Macau’s best practices in anti-corruption practices  

21 september 2005: The Auditor General of Bhutan returned from a two days official visit of Macau Special Administrative Region at the invitation of the Commissioner of Audit. The Auditor General had discussions with the Commissioner of Audit Ms. Fatima Choi and Commissioner Mr. Cheong U of the Commission Against Corruption.  

The Auditor General of Bhutan observed first hand the set up, systems and processes in these these two organizations.

He said that the Commissions strategies and implementation machineries are well structured.

The Commission pays special attention to the prevention of corrupt activities brought about by economic growth. It makes all proper arrangements and takes measures to curb bribery in the Legislative Assembly elections. The Commission continues to supervise the authorities and ensures they implement policies according to the law. To build an honest and fair society together, more anti-corruption programmes to target particular corrupt activities are found being launched.

Possibilities of cooperation between the organizations with the RGOB were being in principle agreed.

The Auditor General of Bhutan also made a courtesy call on the Chief Executive of Macau SAR His Excellency Mr. Edmond Ho in his Office.
 

Regional Workshop on Standardization

16 September 2005: Two officials from the Royal Audit Authority attended the workshop on standardization held from 7^th to 8^th September at the Royal Banquet Hall. The workshop was organized by the Asia-Pacific Telecommunity   and it was hosted by the Ministry of Information and Communications. The workshop was organized to create awareness on the standardization activities for telecommunication and ICT amongst the member countries. It also aims to reiterate among the member countries in the Asia- Pacific region, on the need to further promote and coordinate expert activity in ICT standardization. There were about 21 countries participating in the workshop with 78 delegates including the local participants from various ministries and agencies.

The resource speakers were from Japan. On the first day, the resource speakers presented one paper on the standardization activities and policies for telecommunication and radio system in Japan. They also talked on the standardization activities for high speed access system and briefly highlighted on the ITU-T activities for the developing countries.  On the same day, the Telecom Section Head, Bhutan Information Communication and Media Authority presented the standardization activities carried out in our country.

On the last of the workshop, the delegates presented their country paper on the same topic.
 

35^th ASOSAI (Asian Organisation of Supreme Audit Institutions) Kunming, China

1 September 2005: Dasho Kunzang Wangdi, the Auditor General of Bhutan will be leading a 3-member delegation to the 35^th ASOSAI (Asian Organisation of Supreme Audit Institutions) Governing Board Meeting to be held at Kunming, China from 5^th - 10^th September 2005. The delegates will leave Bhutan on 2^nd September 2005. 

The Royal Audit Authority (the Supreme Audit Institution of Bhutan) was elected as one of the 9 Governing Board members of ASOSAI in 2003. The other members are India, Japan, China, Philippines, Malaysia, Pakistan, Saudi Arabia and Bangladesh.

On his way back, the Auditor General will visit Macau and meet with the Commissioner of Audit and Commissioner against Corruption and discuss on anti-corruption policies and strategies.

As per the schedule Mr. Edmund Ho, the Chief Executive of the Macau SAR has arranged a reception in honour of the Auditor General of Bhutan on 12^th September 2005.
 

The RAA's support to the nation's campaign against drug and substance abuse.

22 August 2005: To support the National campaign against drug and substance abuse launched on August 20, 2005 by the Royal Government of Bhutan, the Royal Audit Authority officials uprooted the Marijuana plants, thriving plentiful around the RAA office premises. Marijuana is one of the most common and popular psychotropic substances grown wildly in Bhutan and is readily accessible to the addicts. 

The effort of the RAA faculty dedicates to all the youths who will never yield to drug and substance abuse ever.
 

RAA official back from study abroad

18 August 2005: Choida Jamtsho, Chief Auditor, of the RAA returns from UK on August 16, 2005, after completing the Masters Degree in Environmental Impact Assessment, Auditing and Management System from the University of East Anglia, Norwich, UK. 

He wrote his dissertation on "Environmental Auditing and Sustainable Development in the Government Perspective". 

He is appointed as the Division Chief of the Report Follow-up Division responsible for effective follow-up on all audit findings. Besides, he would also be responsible for drafting the Environmental Audit Guidelines for the Royal Audit Authority.
 

Talk on Open Source Software 

18 August 2005: Mr. Sean Doyle, founder and Chief Technology Officer of M/s MEDCOMMONS, USA, delivered a talk on Open Source Software at the Royal Audit Authority on August 16, 2005. He acquainted the auditors about Open Source Software and about its popularity, which he said attributes to its Cost, Autonomy & Control and Quality. Mr. Sean also explained the difference between open source and closed source softwares.  

It was highlighted that the source code for computer software is what is created by software engineers. This often translated into object code in different formats so that it can be executed on a computer. The object code is what is used; the source code can be used to recreate the object code. 

Most application softwares are sold or licensed as object code. 

Open source means that the source code is available for anyone to look at; whereas close source means that the source code is considered private property by the company that owns it. 

Microsoft products are close source; whereas most of the internet's basic components are open source. 

He said that the Open Source Software may give Bhutan more autonomy and would be appropriate for building a Bhutanese software sector, chiefly due to the following aspects:- 

• Software can be customized for Bhutan. For example - if your tax system is different than other countries you may want to make a small change to a program.

• As more human knowledge is encoded in software - lack of control means dependency on others.

• Software development need not be done from scratch. Open source software is most successful where there are community of programmers that share source code; many such communities exist and could be joined by programmers here.

• Lawrence Lessig has written several books that discuss the relationship between the architecture of software and the architecture of social control.

• One can start very small – most open source software projects have a handful of developers. A few individuals can make a big difference.

He also remarked that:- 

• Open source software is both a software development strategy and a social movement

• Closed source software is often extremely useful but comes with hidden costs.

• Open source may provide a strategy for controlling software costs in Bhutan.

• Open source may provide a way for programmers in Bhutan to join as equal partners in software projects around the world.

• Open source may provide a strategy for building a software industry in Bhutan.

Mr. Sean Doyle and Cynthia Col are on a fortnight's visit to Bhutan. Ms. Cynthia will deliver a talk on SDE DGE PAAR KHANG MURALS and SUTRA PAINTING OF SSHECHWANG, CHINA on 22^nd August at CBS.
 

RAA(AG-SP)/2005/6485                                               Dated:  15^th August 2005

To,
          The Webmaster,
          M/s Kuensel Corporation,
          Thimphu, Bhutan 

Please refer to the allegations that are being published on the Kuenselonline, that affects the integrity of the Royal Audit Authority and the auditors. 

While we have no objection for any issue on the Royal Audit Authority being publicized in your “From the Readers” column, we failed to understand the non-publication or the delayed publication of our responses to these. 

Our response to "Getting Audit Clearance" posted on 10^th August 2005 at 4:34 PM is found yet to be posted by you.  We have sent the same at 10:00 AM on 12^th August 2005 and even as of date i.e. 12 Noon on 15^th August 2005 it is not posted.  We know that more than 462 persons could have by now formed differing opinions on the hard works of audit. 

I would therefore expect you to give me an appropriate explanation or provide the facts. 

I am holding you responsible for slander and defamation, not the authors hereafter for any false issues on the Royal Audit Authority cleared by you for publication on the Kuenselonline. 

Yours sincerely,  

(Kunzang Wangdi)
Auditor General of Bhutan.

Director of International Relations from the Office of the C&AG in Thimphu

8th July 2005: Mr. Khalid Bin Jamal, Director of International Relations from the Office of the Comptroller & Auditor General of India arrived at Thimphu on 8^th August 2005. 

During his 1-day visit, he will meet with Dasho Kunzang Wangdi, the Auditor General of Bhutan and discuss on the agendas for the 35^th ASOSAI (Asian Organization of Supreme Audit Institutions) Governing Board Meeting to be held at Kunming, China. He will also formally invite Bhutan delegation led by Dasho Kunzang Wangdi for the 35^th Governing Board Meeting. 

Bhutan was elected as one of 9-Governing Board Members of the Asian Organization of Supreme Audit Institutions in 2003. The Comptroller and Auditor General of India is the Secretary General of the Asian Organization of Supreme Audit Institutions.
 

Gearing up for auditing in an IT Environment 

"We wish to see how we can harness IT to take out drudgery and monotony out of auditing, while enhance the capacity to manage the complexity and bring in greater sophistication, economy, efficiency and effectiveness in auditing for creating bigger impact towards accountability in every sphere of public affairs", said the Hon'ble Auditor General of Bhutan, Dasho Kunzang Wangdi at the 8^th Annual Audit Conference 2005. 

The 8^th Annual Audit Conference on the Theme "Auditing in an IT Environment" was held from 21^st to 23^rd July 2005 at the Conference Hall of the Hotel and Tourism Management Training Institute, Motithang, Thimphu.

His Excellency Lyonpo Yeshey Zimba, the Hon’ble Prime Minister of Bhutan graced the opening ceremony. H.E. stated that "Auditing in an IT environment" is timely and necessary in this Information and Communications (ICT) age keeping in view that ICT is wide spread in every field, be in government, business or private organizations. 

H.E. further stressed that effectiveness in auditing should not be at the cost of attainment of the higher national cost. 

"A lot of Offices have websites and we would want to see if the websites are established to serve the purpose of communication and education and not to put up simply because it is fashionable," said the Hon'ble Auditor General of Bhutan. 

The 3-day conference reviewed the implemented of the resolutions of earlier annual audit conferences and two years’ experiences of operationalising the concept; "Auditing beyond the Books of Accounts".

AG's Report for 2004-2005

The Auditor General, presenting his report sees urgent need to step up education and awareness in Auditing.

According to the report, in 2004-2005, 266 audits were conducted of the 283 planned audits representing over 94%. 5,707 clearance certificates were issued - 2,866 for promotion, 2,109 for training, 492 for retirement and resignation, 232 for contract extension and eight for secondment. Audit recoveries for the year amounted to Nu.28.730 million.

Further he reported that the Annual Audit Report 2004 was issued in May 2005 and irregularities in monetary terms had witnessed yet another decline as compared to all the previous annual audit reports.

While presenting the report the Hon'ble Auditor General of Bhutan stated that the year was particularly significant as it was able to successfully able to host an international meeting for the first time in its history and history of the country - the 14^th INTOSAI Standing Committee Meeting on IT Audit.

He reported that the Royal Audit Authority completed the audit awareness programme in all twenty Dzongkhags for members of the Geog Yargay Tshogchung, Dzongkhag Yargay Tshogchung, Gaydrungs and Dzongkhag Public Servants.

"The second RAA open forum was organized on 10^th Dec. 2004. Only finance personnel and engineers attended the session as if they only have interest in national accountability issues," he reported.

The Hon'ble Auditor General of Bhutan reported that there was a knowledge and interest deficit on accounting in the central government employees at all levels.

"As far as the centre is concerned there is a problem of reaching people since most audit reports issued are given to either accounts people or project managers while the rest of the people are not aware of what is happening," he said.

IT auditing - Challenges ahead 

The development and increasing use of Information and Communication Technology (ICT) in the auditees was a challenge to the traditional approach of auditors, which focused on scrutiny of accounts maintained manually. It was felt that such a situation would create room for inaccurate accounting and ICT related fraud as the auditors would find it difficult to complete their task effectively and efficiently in an electronic environment. 

In order to maintain pace and momentum with the auditees it was important for the Royal Audit Authority to adopt strategies to tackle the challenges of this ICT age. Therefore, it is important for auditors to use ICT as a tool in their work to test the accuracy of information generated and audit the effectiveness of IT systems used by various organisations.

It was important that the Royal Audit Authority had chosen the Theme for the 8^th Annual Audit Conference as "Auditing in an IT Environment" in order to address the auditing issues relating to ICT. 

The drafting team of the Theme paper pointed out that inadequate IT audit awareness among the auditees, lack of IT auditing software, technical capability and ICT infrastructures were some of the limitations that the Royal Audit Authority had to overcome to conduct audit in an IT environment effectively and professionally.  

In order to overcome the above limitations and to prepare for the future, the drafting team had identified fourteen strategies out of which ten strategies were adopted as conference resolutions. 

The Theme of the conference was also presented in the form of audiovisual clearly demonstrating the will of the Royal Audit Authority in its pursuit of auditing in an IT environment. 

To begin with the drafting team had recommended adopting the recommendation of the Peer review of the RAA to form a core group of seven (7) members, an advisory body who will spearhead in the conduct of IT audits. 

The RAA during the conference had adopted the recommendation of the drafting team. 

To begin with, the conference adopted that the Royal Audit Authority in a modest way would take up the audit of procurement and use of IT equipment, development and use of websites, development and use of software and evaluate the implementation of Bhutan ICT Policies and Strategies (BIPS).

Two Years experiences of "Auditing beyond the Books of Accounts"

A total of 11 Team Leaders presented their experiences on operationalising the concept "Auditing beyond the books of accounts" during the course of auditing during the past two years. 

The Team Leaders highlighted that important issues and irregularities were unearthed by going beyond the books of accounts rather than restricting to the documents and accounts maintained.

In following the above approach, pertinent and common methods adopted by all auditors were physical verification or field inspection, Market survey analysis, distribution of questionnaires, interviewing & enquiring, visual aid and photographs, confirmation from the third party on forged signature etc. 

The issues unearthed by adopting the above approach were mainly of construction works where payments were made without executing the works, use of substandard materials, use of materials in deviation to specifications etc. In adopting such approach, auditors were made to travel all the way to rural and far flung areas where constructions works were carried out and proper supervisions were not carried out. 

The Hon'ble Auditor General of Bhutan appreciated the use of graphic and audio visuals by the auditors in auditing beyond Books of Accounts and presentation of their findings. However, he urged all auditors to take due care on use of appropriate language while writing and presentation of reports to ensure the means do not undermine the ends and to follow the common standard of reporting. 

It was decided that Team Leaders' experiences on operationalising the concept "Auditing beyond the Books of Accounts" will be one of the agenda in future conferences.

Review and evaluation of Annual Audit Plan 2004-2005: Office of AAG, Tsirang topped 

By looking back at the Annual Audit Plan 2004-2005, the RAA had reasons to take pride in its achievement, for it had achieved 94% of the plans in terms of audit conducted and planned, which was a significant improvement over the 2003-2004 plan achievement of 87.04%. 

The audit plans were evaluated in terms of audit conducted and the reports issued as against plans, timeliness of audit, audit started and completed, and reports issued, comparison of planned duration vis-à-vis actual duration taken for completion of audit and issuance of report and computing the deviations thereof.  

In overall the RAA had shown improvement from the previous years both in terms of audits conducted and reports issued. The final rankings of the divisions were also assigned on the basis of all the evaluations. The Office of the Assistant Auditor General, Tsirang was reported to have topped the overall ranking of the RAA.

Further the Annual Audit Plan 2005-2006 was also presented to the House for approval. For the Year the RAA had planned 332 audits across 358 agencies and 332 reports are expected to be issued during the Financial Year 2005-2006.

ICT - A tool for transparency and combating corruption 

At the Closing Ceremony of the Conference on 23^rd July 2005, H.E. Lyonpo Leki Dorji, Hon'ble Minister for Information and Communications said that ICT affects our everyday lives at both an individual and organisational level. 

"We cannot avoid the use of information and communication technologies, and it is important that we know how to live with those technologies appropriately," H.E. said. 

H.E. complimented the audit community led by Dasho Kunzang Wangdi that RAA is proactively keeping abreast of the very fast developments in information and communications technologies. 

"ICT is a means to achieving a corruption-free Bhutan, a necessary catalyst to boosting the Royal Audit Authority's motto of "Clean Public Service - Nation's Pride", very instrumental to achieving our common goal of Gross National Happiness," H.E. said. 

H.E. highlighted that the importance of auditing in an IT environment is twofold: "First, ICT tools are now used across all agencies and all sectors of the economy, so auditors need to understand ICT to understand how modern organisations work. Secondly, ICT tools offer new opportunities for increased efficiency to auditors, as well as all other sectors; auditors need to make most of these opportunities". 

The Hon'ble Auditor General of Bhutan said that as we enjoy the support of the Royal Government, the Bhutanese people and the recognition of the world auditing family, it calls on us to deliver even more. 

"We shall be firm and assertive in our works but conduct them with a humane face and approach," he said. 

The 8^th Annual Audit Conference came to successful conclusion on 23^rd July 2005, where the RAA had adopted a total of 26 Resolutions to be implemented in the coming years. 

-  Proceedings of the 8th Annual Audit Conference Format: MS Word
-  Resolutions of the 8th Annual Audit Conference Format: MS Word

"Inroads to Performance Auditing": Theme for the RAA's 9^th Annual Audit Conference 2006 

28 July 2005: The 8^th Annual Audit Conference of the Royal Audit Authority (RAA) unanimously adopts "Inroads to Performance Auditing" as the theme for the 9^th Annual Audit Conference to be held from 21^st to 23^rd July 2006. The auditors voted for the theme out of more than fifteen themes proposed by different individuals. 

The United Nations Development Programme (UNDP) is training 27 Officers of the RAA on Performance Auditing of Works at the Office of the Comptroller & Auditor General of India.  

While Financial, Propriety and Compliance audits are equally important in their own right, these are inadequate to address as to whether the intended objectives for which public resources applied are attained. 

Performance auditing, one of the most important auditing functions of modern government auditing promotes accountability and ascertains economy, efficiency and effectiveness of public services. Therefore, increasing importance is being attached to the performance auditing, i.e. Value for Money Audit (VFM) by all Supreme Audit Institutions (SAI) over the last several decades.  

As the RAA had committed to ensure the successful implementation of the 9^th Five Year Plan of the Royal Government of Bhutan, performance auditing would enable the RAA to see and ascertain whether the planned activities are carried out economically, efficiently and effectively and the desired results as envisaged in the plan document are achieved. 

The 9^th Conference shall review the experiences gained from the application of performance auditing.

Significant Audit Observations 2005 

18 July 2005: The presentation of the Significant Audit Observation by each division is a mandatory annual feature of the Royal Audit Authority. The event is aimed to share, enlighten and alert the auditors on various facets of irregularities and corruptions discovered and encountered during audit assignments and equip them with counteractive measures. 

This year the presentation was made on the 14^th July 2005 in the BCCI conference hall. There were altogether eight divisions presenting the Significant Audit Observations unearthed during the course of their year long audit.

The panel of judges was appointed from each of the RAA divisions to assess and evaluate the observations. The evaluation was mainly based on application of professionalism and tactfulness while conducting audit, such as Planning; Approach; Analysis; Professional Judgment & Common Sense; Monitory Implications and Benefit to the Auditee Agency/Government as a whole. 

The presentations were on following observations:- 

1.      Inadmissible payment of winter vacation salary for the teachers by OAAG, S/Jongkhar;
2.      Construction of Thangna & Pangna Irrigation Channel at Tsirang and Irregularities thereof by OAAG, Tsirang;
3.      Non-maintenance of Vehicles Log Book and the consequences thereof by Corporation & Financial Institutions Division;
4.      Irregularities in construction of Police Outpost at Damdara under Gedu Police Station and recoverable amount of Nu 1,082,295.95 by General Governance Division;
5.      Improvement & extension of landfill site at Memelakhang and irregularities thereof by Communication Information & Construction Division;
6.      Less deduction of house rent resulting in loss of Government Revenue to the tone of Nu. 244,508.00 by Resource Trade & Commerce Division;
7.      Irregularities in procurement of camping equipments by Social & Cultural Division; and
8.      Misuse of School Development Fund by OAAG, Bumthang.  

The observations presented were all sensational and noteworthy involving much groundwork and perseverance. Though common sense as we all know is rarely common nevertheless the auditors were not short of this sense while conducting audit, in fact it had a crucial hand in unveiling the discrepancies discerned by the auditors.

It was the Office of the Asst. Auditor General, Tsirang, that swept away the first position last year, however, it was the presentation made by Wangchuk (C) on behalf of the General Governance Division that captivated the attention of the jury as well as the audience this year. The presentation was on "Irregularities in construction of Police Outpost at Damdara under Gedu Police Station and recoverable amount of Nu 1,082,295.95". It had all the ingredients required to churn out a highly successful audit assignment. Congratulations GGD for the deserving win.

The RAA Training Specialist leaves for Beijing, China to design a course on "Audit of Fraud" 

11 July 2005: Tashi, Head, Human Resource and International Relations Dvision who is also the ASOSAI Training Specialist left for Beijing on 9^th July 2005, China to design a course for the ASOSAI region on the "Audit of Fraud". Tashi will be joined by the training specialists from Philippines, Indonesia, Maldives, China and Pakistan. 

During the two weeks design meeting, the six member training specialists will review various documents on Fraud and design a 5-day course on the "Audit of Fraud". The same group will deliver the course in Pakistan in December 2005 to the selected auditors from the Asian region. 

This will be the third course designed and delivered by Tashi during the last 2 years.

Annual Inter Divisional Khuru Tournament 2005 

11 July 2005: As a regular annual audit event the RAA Inter-Divisional Knockout Khuru Tournament began from 25^th June 2005 at the YHSS football ground. A total of 10 teams participated in the tournament. After a fortnights tussle amongst the Divisions, the General Governance Division's (GGD) team and the Office of the Asst. Auditor General (OAAG), Samdrupjongkhar's team immerged as the finalist. The final was held on the 9^th July 2005 with both the teams displaying spectacular performance on that pleasant day. The GGD team put forth an impressive performance in the first game by finishing the game 25-10, however, the OAAG, S/Jongkhar team retaliation with an vengeance in the second and the third game and bagged the RAA Inter-Divisional Khuru Tournament Trophy 2005 with a lead of 25-05 and 25-07.

The champion team will be taking the trophy all the way to the OAAG, S/Jongkhar, as a souvenir.

In-House Training: Dzongkha Computing Training 

8 July 2005: As a part of the Annual Audit In-house Training, the RAA is conducting a week long training on Dzongkha Computing for 50 auditors in the RAA Conference Hall. The training is conducted by a resource person from the RAA. The training is targeted towards creating awareness among the Dzongkha key users on the Dzongkha Unicode tools and fonts developed by the Dzongkha Development Authority in collaboration with Department of Information & Technology. 

The course encompasses the following topics: 

• Installation and configuration of Dzongkha Unicode fonts and Keyboard driver;
• Use of Dzongkha Keyboard layout;
• Creating Dzongkha Word document;
• Creating Dzongkha plain text document;
• Creating Dzongkha Spreadsheet document;
• Creating PowerPoint document using Dzongkha Unicode fonts;
• Creating Dzongkha Access document;
• Creating Publishing document using Dzongkha Unicode fonts;
• Creating simple Dzongkha web pages using Microsoft Word application;
• Sending E-mail messages in Dzongkha using MS Outlook Express 2003; and
• Use of Unicode Converter to convert the legacy documents into Unicode document format.