Professional Documents
Culture Documents
Either:
International Standards on Auditing, issued
by IFAC (International Federation of
Accountants)
or:
TYPES OF AUDITS
Financial
Compliance
Operational
FINANCIAL AUDITS
The Implementing Organization’s
Financial Statements
Project Financial Statements
Statements of Expenditures (SOEs)
Special Bank Account (SA)
Implementing Organization’s
Financial Statements
Overall objective is to express an
opinion on fairness of
statements
Phases:
Understanding the Organization
Evaluating Internal Controls
Testing Financial Statement
Balances
Understanding the Organization
Nature of the Organization’s
Activities
Organization’s Background
Significant Trends and
Relationships
Staff Appraisal Report (SAR)
Loan Agreement
Other Documents Pertaining to the
Project
Evaluating Internal Controls
Why?
» Because withdrawal requests are
not supported by documentation
submitted to the Bank
Effect?
» Results of audit are basis for
determining whether to continue
use of SOEs, or if adjustment must
be made on subsequent claims
Audits of Special Accounts
Auditors should:
» Review the SA records maintained by
the Implementing Institution
» Review the SA bank statements
» Reconcile (including tracking of in-
transit items)
» Directly confirm balances with Bank
» Examine treatment and disclosure of
interest earned on SA
Audits of Adjustment Loans
Important issues:
» TOR must satisfy financial covenants
» Documentation must not have been used to
justify another adjustment loan
» Claims must be properly documented
» Negative list items must be verified
» Cut-off dates must be verified
Requirements for Auditors