With the dynamic pace of change at international and local levels worldwide, the public sector is under consistent pressure to respond to both familiar risks and the emergence of new risk scenarios. The rise of cyber-attacks on public institutions and the increased reliance upon social media are new developments which require a strong information security strategy. Failure to manage risks appropriately can result in a loss of reputation and citizens’ trust in government.
Audit professionals need to ensure that their audit methods are up-to-date, accurate and able to uncover bad governance in order to recommend innovative and effective solutions. In other words, Auditors need to make sure that they are able to meet their new responsibilities and to extend their know-how on a daily basis. As the public sector is undergoing significant transformations, fighting fraud and corruption remains an imperative for public sector officials. In the wake of declining budgets and the demand to do more with less resources, it is of utmost importance that fraudulent behaviour is prevented from the outset. The bottom line is that it is always easier to set early warning systems in place than to deal with the consequences of a failed anti-corruption policy. Facing this array of challenges, how can officials best succeed in fighting corruption?
The best solution for promoting good governance is to put in place an accurate risk management system which supports officials in detecting weaknesses and risky areas. A proper risk assessment hence lays the foundation for a robust anti-fraud policy. Moreover, public organisations must establish a solid internal control framework which determines roles and responsibilities and ensures that appropriate standards are put in place to guarantee the good governance of the organisation. In this context it is crucial that public officials charged with financial responsibilities carry out their tasks in efficient and trustworthy manner. Financial control mechanisms are indispensable if the public sector wants to maintain its integrity. However, it is important to note that public institutions across the world faces a different set of risks depending on context, culture and the given governmental mandate. Thus, institutions might need to adopt different risk management solutions as well as a risk management strategy tailored to their institutional demands. Compliance audits can be powerful instruments to strengthen the good governance of public organisations. In particular, they assist Auditors in assessing the causes of rule violations or identifying whether laws and regulations meet the set standards. In this way, compliance audits can effectively cure mismanagement and prioritise those areas where corrective actions are particularly urgent.
As a matter of course, detecting fraud when it comes to EU funds control is particularly challenging. Firstly, it is in practice difficult to distinguish between actual fraud and cases where (unintentional) procedural errors have occurred. Secondly, responsible authorities need to establish a fail-safe anti-fraud strategy that complies with the standards set by the European Commission. Particularly the audits in ISF as well as audits in AMIF are subject to strict rules and guidelines. In this context statistical samples, eligibility rules and error rates prove to be among the most burdensome tasks to be conducted in EU funds auditing. At the same time, Audit Authorities need to keep a close eye on public procurement control as an integral part of the internal audit system. Apart from audits in AMIF and ISF, funds in the area of EU development cooperation projects and those related to EU humanitarian aid funding have gained greater importance. Already in the early preparation phase Project Managers need to be capable of showing that they are able to implement the external audit guidelines of the European Commission or the donors respectively. It is therefore absolutely crucial that a proper risk assessment procedure and project risk analysis is carried out at the pre-audit stage. Another major audit area concerns audits in European research and development funding. EU funded projects, such as Horizon 2020 or the Marie Skłodowska-Curie programmes provide huge opportunities for universities and research institutes for realising research projects. At the same time, the management of these grants is subject to strict and complex guidelines. If responsible authorities fail to meet those, grants might be frozen or even worse, have to be fully reimbursed. Every European research project should therefore be supported by effective financial accounting mechanisms such as detailed record keeping and addressing distinctions between the eligibility of direct and indirect costs. Project Managers therefore need to have a solid understanding of how financial accounting in European research is correctly carried out.
Fraud and corruption remain the biggest threats to the proper functioning of public institutions. The European Academy for Taxes, Economics & Law supports internal and external Auditors by providing high-quality practical seminars and trainings on key issues including business risk analysis, political risk analysis and project risk management. Our seminars are designed with the highest standards, up-to-date, and provide practical solutions for everyday challenges public sector officials face in their work. Our distinguished expert speakers are themselves familiar with the peculiarities, needs and problems of audit professionals and hence provide trainings that are tailor-fitted to your needs. In hands-on workshops participants have the opportunity to transform the knowledge gathered during the seminar into immediate practical actions. You will gain a deeper understanding of how to conduct risk identification, write an advanced audit report, develop a risk management plan and familiarise yourself with different auditing standards. Finally, as IT threats are becoming increasingly frequent and severe, we aim to support public sector officials in developing strong IT risk management strategies and demonstrate how an IT security audit is conducted properly. Only through a holistic approach that encompasses risk management, internal control and internal audit, are public sector officials comprehensively equipped to best meet the challenges ahead.