AUDIT OF WATER RESOURCES

1. AUDIT OF WATER RESOURCES SUBJECTSELECTION

2. Learning Objective At the end of this session, participants will be able to • explain auditing of water issues methodology, • describing key risks, • identifyissues related with water resources management, • create recommendation to solve water related issues.

3. Selecting Water Related Studies • Governments spend money on many different programs and projects related the water usage. • It is important that the money is spent to achieve the desired objectives with emphasis on the 3 E’s (i.e. Economy, Effectiveness and Efficiency). • Project managers are responsible for ensuring the projects are managed in a proper manner. • Auditors are responsible for providing independent assurance to legislatures and sponsors on whether objectives and goals have been achieved effectively. • The selection process must consider several key factors to guide the selection of appropriate topics.

4. How to select the subject? EXERCISE :1 You will perform an environmental audit in your country in the field of water resources. You have no experience in this field. What do you do to learn the field? Make alist. (Information Sources and What you learn) Describe the subject selection process considering the threats against usage of water resources in your country. Decide on your audit topicand audit type.

5. Factors affecting the subject selection I • natural geography of the country • influences of neighboring countries • other national interests (for example, security, poverty eradication, economic development) • the strong presence of specific industries • urgent environmental problems

6. Factors affecting the subject selection II • need for good governance • capacity of the national government and SAI • a perception that environmental protection and management can only occur after a country becomes more prosperous • Changing security or political stability

7. Subject selection criteria Performance risks /environmental risks Interest of public, media and Parliament Impact expected from audit Significance Being auditable

8. Understanding The Audit Topic • Understanding the entities is the initial stage of the audit examination which requires the development and maintenance of relevant information. • This stage is carried out to undertake to gather information about the entities and to identify the factor that affect whether or not entities achieve their objectives economically and efficiently. • Breaking down an activity into its constituent parts, such as by objectives, inputs, processes, outputs, variables, and outcomes can help understand

9. Sources of Information Sources of information to assist in understanding may include; • Legislation and regulations • Ministerial statements, government submissions and decisions, • Recent audit reports, reviews, evaluations and inquiries,  • Scientific studies and relevant research (including from other countries and international organizations • Strategic and corporate plans, mission statements and annual reports; • Policy files, management committee and board minutes, • Organisation charts, internal guidelines and operating manuals, • Programme evaluation and internal audit plans and reports, • Conference reports • discussions with auditee management and key stakeholders, and management information systems.

10. Assessing Parliamentary and Public Interest • The auditor may wish also to consider the major stakeholders (for SAIs, Parliament) and their views and interests. • We should assess how interested Parliament; the public and the media. • We may monitor debates in Parliament, correspondence with the public and members of Parliament, and media interest. • We may also identify any entities or topics that Parliament’s Public Accounts Committee is concerned about.

11. Auditability Before deciding the audit topic, we should answer these questions: • Can we carry out this audit? • Do we have any limits to access to documents and officials, or rights to report publicly. • Is there any lack of audit mandate? • Do we have enough audit skills and experiences? • Can we find out sufficient data on the state of the water related topics?

12. Audit Objectives and Scope • Determining audit objectives gives us a sense of direction and clarifies the purpose of audit.(Audit Map) • After deciding on the audit objectives, the auditor must decide on the scope of the examination to undertake to achieve the audit objectives. The scope of an audit establishes the audit’s framework or limits.

13. Selecting Audit Types Environmental audits can be conducted in several types by SAI’s. • Regularity audit( Compliance and Financial) • Performance audit • Combination of both It is clear fact that the vast majority of environmental audits include performance audits.

14. Audit Types Regularity Auditing • Auditors review transactions and financial statements or reports to see ıf the government conformed to all laws and regulations. • It with regard to water issues may relate to providing assurance that governmental activities are conducted in accordance with relevant laws, standards and policies at both the national and international levels.

15. Performance Audit • A performance audit is an objective, purposeful, organized and systematic examination of a public sector organisation’s programme, activity, function or management systems and procedures to provide an assessment of whether the entity, in the pursuit of objectives, has achieved economy, efficiency and effectiveness in the use oftheir resources. • Performance audit, therefore, involves an independent assessment of whether economy, efficiency and effectiveness have been achieved by the organisations concerned.

16. Risks Toidentifyourauditobjectiveandscopeeffectivelyweshoulddeterminekeyrisks in ouraudittopic. • Identify the Main Risks • Record and Rank Risks • Assess the Quality of Management

17. Identify the Main Risks • We identify risks as the factors that may make objectives hard to achieve, however well the entity manages performance. • Factors coming from outside may make the achievement of aims difficult. These would include such aspects as new legislations, laws that are difficult to implement or laws change that frequently, complex programmes, new technology, unusual events and rapid expansion. • Some factors may coming from inside such as weak internal control, bad risk management, lack of staff or insufficient staff, technology, insufficient monitoring and reporting system.

18. Record and Rank Risks • The auditor decides which of the risks remain important, after taking account of the organisation response • The auditor will than need to make an assessment of how likely and how serious he/she believes them to be. This should be enable the risks to be given an approximate order or ranking, generally in terms of “high, medium and low”. • The auditor can also use to assess degree of risk in terms of likelihood, frequency, significance, extent or consequence. • Auditor aims to be specific, and include causes and possible effects.

19. Assess the Quality of Management • The knowledge and experience gained from other audit works is also a valuable aid in identifying risks. • We take account of financial auditor’s assessment of the control environment. The control environment concerns how far the entity’s act as if they think control and achieving objectives is important. • The control environment includes management’s operating style,the assignment of responsibilities and the policing of control procedures. It is therefore fundamental to the way in which controls operate within an organisation.

20. Risks to Good Management • Management inaction in response to identified weaknesses. • Complexity in the regulations • No internal control system • High staff turnover • Significant underspending or overspending • Lack of monitoring system • Sudden program expansion • Overlapping or confused responsibility relationships

21. Protection of National Forests

22. Significance • Forests perform various vital functions such as preventing climate change, air pollution and erosion, producing clean water and oxygen, and providing a habitat for various creatures. • Our country has a total forest area of 20,7 million hectare. • In parallel with the global developments, forests in our country are in tendency to decrease due to various reasons. Çevre Denetiminde Konu Seçimi

23. Risks in relation to Efficiency, Effectiveness and Economy • The Ministry of Forestry does not perform its activities in the framework of open and clearly defined aims and measurable targetsin the framework of a strategic plan • There are risks in relation to good governance • Forestry activities are conducted under different organizational structures and effective collaboration and coordination cannot be achieved • Cadaster operations of forests are not completed. Forest resources are ruined due to rural poverty • The Ministry of Forestry does not have a management information system including activity and cost data Çevre Denetiminde Konu Seçimi

24. Parliament and Public interest • High quantity of written and oral questions submitted to the Parliament by the parliamentarians • The subject is included in news for hundreds of times in the written and visual press • Since forest existence is perceived as a national wealth, practices harming forests have repercussions in large masses of people and NGOs

25. Impact expected from audit • The Ministry of Forestry prepares a strategic plan consistent with the Development Plan and performs its activities according to clear aims and measurable targets determined in the framework of this plan, • It establishes a performance indicators set, measures its own performance and makes its resources allocations based on this information, • Creating a suitable environment for holding entity managers accountable and realizing entity activities with more transparency, • Ensuring coordination and collaboration among relevant units effectively, • Eliminating the managerial and administrative arrangements preventing the efficient and effective implementation of activities and ensuring the extensive use of good practice examples. beklenmektedir.

26. Questions regarding audit Are the audit scope and limits well-defined? What do audit subjects cover and how is the audit timing? How will you monitor the audit management and effectiveness? (quality assurance system should be questioned) Are we sure that audit subjects are complete and full? Which audit approach should be followed? What are the resources required for audit? Are there any subjects excluded from the audit scope, and why?

27. Questions