By Camilla Fredriksen, Manager, IDI Global Foundation Unit
The Global SAI Stocktaking Report 2020 was launched in September. This is the fourth triannual exercise that analyses data from an INTOSAI Global Survey, to give a snapshot of SAI performance and capacities. The report marks the 10 years anniversary for the Global Stocktake which has been an important source to inform INTOSAI and donors about where the need of SAIs lie. 178 SAIs responded to the Global SAI Survey.
This year’s report shows how SAIs operate in increasingly difficult environments, characterised by democratic backsliding and elevated levels of corruption. A main message of the report is that SAI Independence remains at risk and will continue to do so in the existing political environment. In low-income countries, SAIs are more likely to have an inadequate legal framework that may compromise their financial and administrative autonomy even further.
Yet, even with an adequate framework in place, the report suggest that SAIs experience other emerging risks. For example, only 44% of SAI had full access to the information they need to carry out their audits. Recent developments have confirmed that the reported risks to SAI Independence are expanding, and that there is a need to better understand what these risks entail. Furthermore, there is a need for stakeholders to rally behind SAIs to support their right to conduct and report autonomously. The GSR webinar on SAI Independence, which brought stakeholders together to discuss the results, pointed out that as trends on decline in civil liberties continue, there is a need to be thinking more pro-actively about SAI Independence, acting through broad coalitions and focusing not only on SAI Independence alone, but on the detrimental effects constraints to delivery of audits and assurance will have to overall accountability, and services provided to citizens over time.
The Global Stocktake suggests that access to resources is affecting SAI performance in its core audit services. For the first time, SAI were asked whether they see themselves having sufficient resources, both financially and in terms of staff. Only 52% of SAIs confirmed to have sufficient resources, while 70% of SAIs found staff to be inadequate either in terms of staff numbers, competencies, or both. This is concerning as SAIs are facing additional requirements to be able to fulfill mandates and implement ISSAIs. Results show that audit coverage has dropped from 2014 both for financial and performance audit, and that still few SAIs are complying with the ISSAI standards for audits. 37% do not have a quality monitoring system for any of the audit streams, and a lack of resources is the report main reason for not being able to implement the ISSAIs. At the same time many SAIs recognize their limitations and the need for capacity development. 96% of all SAIs plan to develop competencies in the coming period. Going forward it remains critical to support SAIs to continue to do their work in the wake of the pandemics, and to equip them with tools that allow them to do remote auditing and a risk-based approach to clear backlogs.
It is worrying to see that, since the initial rise after the establishment of INTOSAI-Donor Cooperation in 2010, the value of capacity development support to SAIs globally has flatlined while pressure on SAIs increases. $88 million in support annually, for the past seven years, represents a real term fall in support for SAIs, at a time when global development spending has been rising. It suggests that the need to scale-up support is more important than ever.
It’s also notable that certain regions are falling short at the expense of global initiatives: notably, the financial value of support to ARABOSAI has fallen, and the value of the support to CAROSAI, CREFIAF and PASAI remains low. In addition, some SAIs are reporting not to receive any support at all, creating a real risk that SAIs and countries may be left behind. Moreover, 74% of SAIs in lower income countries had challenges in obtaining support for projects to be implemented by the SAI itself, a trend that may go against the IDC principle the support should be SAI-led.
When presented with the findings during the IDC Annual Meeting 2021, IDC members discussed how to address the issues the Global Stocktake raised. They agreed that providers must find a good way to align their support to the context of the SAIs because a lack of understanding of context can be an important reason for failed projects and lack of willingness to support. Donors also need to be flexible when considering supporting SAIs, also in cases where SAIs don’t have capacity to develop concept notes. When providing support to SAIs in challenging contexts, providers need to consider their starting capacity as well as absorption capacity and strike a balance between the support offered and the demands to the SAIs. This will allow the provider to meet the most critical needs the SAI, but also the SAI to lead the processes in ways where they can achieve results, and gradually build up competencies
There is also a potential for donors to increase support to SAIs by using peer support. The Global Stocktake confirms again that peer support is the preferred support modality by SAIs, because it means involving other SAI staff with a better understanding of the role and the challenges of the recipient SAI. While the COVID-19 has brought on limitations to on-site exchange, this could still be achieved through establishment of infrastructure to allow for more digital exchange between the SAI and the peers. To identify peers and understand the SAI better, donors could interact more with regions who have a better view of the needs of SAIs, to inform themselves.
The Global Stocktaking Report concludes that there is a need for SAIs to have a more holistic approach to audit, to ensure impact. Globally, there is limited communication and involvement of key stakeholders in the audit and follow-up process. In order to help SAIs focus more on Stakeholder Engagement, there is a need to support them in establishing them more strategic communication with and involvement of key stakeholders such as Parliament and Executive to increase impact of audits and use channels to advocate for independence where that is an issue. Here, donors have the possibility to use their PFM coordination networks on country level to raise the importance of Supreme Audit Institutions, as a way of facilitating interaction with other stakeholders.
GFU will continue to disseminate the findings of the Report by region, theme and cross-cutting priorities, as well as in events with partner and stakeholder organisations that also focus on support for SAIs and PFM.