Ensuring transparency in public auditing

The importance of the Office of the Comptroller and Auditor General (OCAG) of Bangladesh is yet to be properly acknowledged, especially by the policy makers. Despite recognised by the Constitution and known as the Supreme Audit Institution of the country, the role and functions of the body are undermined in many ways. The annual report for 2014, the latest record of the OCAG's activities, implicitly reflects this.
The core function of the OCAG is 'auditing government receipts and public spending to ascertain whether expenditures have yielded value for money in government offices, public bodies and statutory organisations.'
Thus, all the accounts of the government and semi-government bodies are subject to the audit of the OCAG. There are 10 audit directorates under the OCAG to conduct audit.  
Moreover, there are three offices - Controller General of Accounts (CGA), Controller General Defence Finance (CGDF) and Additional Director General (Finance) for Bangladesh Railway - responsible for pre-auditing functions. Moreover, these offices are assigned with the responsibilities of compiling the Finance Accounts and Appropriation Accounts of the government.
STATISTICS TALKS: The latest annual report of the OCGA reveals that the body completed 14 audits in 2014. But the number of completed audit was 41 in 2013. Four types of audits have been conducted by OCGA.
In 2014, one performance audit was completed against two in 2013. Six special audits were completed last year while the number was two in 2013. In 2014, two issue-based audits were completed against five in 2013. Finally, six annual audits were competed last year while the number was 32 in 2013.
Although, lower number of audits doesn't necessarily mean that the supreme audit institution is in a bad shape but it definitely indicates lower performance of the constitutional body. Moreover, all the audits, completed last year, related to periods prior to 2012. Thus, there is a lag of minimum two years which is, however, not very unusual.
The annual report also reveals that 14 annual audit and one special audit reports are under the process of finalisation and expected to be ready for submission to the President this year.
Again, some 16,377 audit observations were settled in 2013-14 which involved Tk 186.08 billion of 51 ministries and divisions. It is interesting to note that seven ministries and divisions had maximum amounts of money involved in these audits.
Road, Transport and Highway Division alone had 341 audit observations involving Tk 67.77 billion. Power division had 399 audit objections involving Tk 33.61 billion. Other ministries and divisions having audit observations involving Tk 10 billion or more were those of education, local government, posts and telecommunication and energy and mineral resources. The Ministry of Railway and Finance and Banking Division had audit objections involving over Tk 5.0 billion each. It may be noted that these ministries and divisions deal with mega projects and programmes, and hence their spending is also large. However, allegations of fund misappropriation and irregularities are also very high in these ministries and divisions and their subordinate bodies. Thus, the bulk of the audit objections, though settled, may be seen as reflecting alleged misappropriations and irregularities.        
Last year, Public Accounts Committee (PAC) examined 148 audit observations of 16 audit reports. Of these, 32 observations involving Tk 1.32 billion were fully and three observations involving Tk 48 million were partially settled.  Of these, Tk 1.8 billion was recovered and adjusted through audit recommendation.  
The finance minister said in parliament in June this year that the total number of unsettled audit objections against 55 ministries and divisions was 8,53,314 involving Tk 6,156.06 billion. The amount, as he mentioned, is more than twice the size of the national budget for FY16. The size of the current fiscal year's budget is Tk 2951 billion. Settling the huge number of audit observations or objections is a daunting task. Shortage of manpower and logistics make it still more difficult for OCAG. Some five thousand officers and staffs are now working in the OCAG and of them around four thousand are auditors.
The annual report mentions that there is a continuous capacity building initiative under a five-year (2013-2018) strategic plan. Use of information technology in auditing has also increased.  
TRANSPERENCY WITHIN: In an interview with a newspaper recently, Comptroller and Auditor General (CAG) Masud Ahmed said that the government spent Tk 1.15 billion in FY14 for the supreme audit institution and in return it realised Tk 78.80 billion. He also said that this means Tk 68 was realised or adjusted against every taka spent by the state auditors. This statistics is quite relevant to show the importance of audit to ensure transparency in public spending. The actual budgetary allocation for the OCAG was Tk 1.45 billion in FY15 which was revised to 1.46 billion. And for FY16, budgetary allocation is Tk 1.62 billion.
But, the annual report doesn't mention anything about the budget or spending of the OCAG itself. A summarised description of spending should be there so that anyone can figure out where the money is being spent.
Moreover, one can also compare with the spending of the other government bodies. Being responsible for ensuring transparency and discipline in public spending, OCAG itself needs to be transparent in its own financial spending. Providing details of its own spending will definitely enhance credibility of the OCAG.
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