buletin - Jabatan Audit Negara

RENCANAAccountability And Good Governance :Auditors Roles – Public ExpectationsPresented by YB. Dato’ Shahrir bin Abdul Samad, Chairman of Parliament Public Accounts Committeeat the National Audit Convention in conjunction with the 100 th Anniversary Celebration of the National Audit Institution Of Malaysia14 February 2006Auditing – no laughing matter?While I was preparing my speech andsearching through the Net, I realised thatauditors are hardly the subject of humanwit - auditing a serious business andauditors serious! Nobody laughs at themand they do not laugh at themselves.When I asked my wife, a companydirector what she thought of auditors,and she said: “they are feared.”My personal experience with auditorsstarted after I left the Governmentin 1987 to start my own business. Thepresence of auditors scrutinising mycompanies’ accounts did not makeme see the connection betweenauditors and issues of accountabilityand governance because it involved mymoney. It was just what the ROC wanteddone. “Get your accounts audited.” Myintroduction to real auditing was when Ibecame Chairman of the ParliamentaryPublic Accounts Committee (PAC) on14 December 2004.Can auditors ensureaccountability and goodgovernance?My appointment as Chairman of agovernment-owned company in early2005, flushed with cash but notoriousfor financing dubious enterprises andlosing money, vividly demonstrated tome the connection between auditing,accountability and governance. At thattime I was already the Chairman of thePAC. It gave me the opportunity to seekthe counsel of Tan Sri Dr. Hadenan A. Jalil,our Auditor General, who advised meto invite the Audit Department to do amanagement audit on the company.The audit was done. It appeared the auditprevented bureaucratic and politicalinterference in the board’s decisionmakingpowers and allowing good| governance. I can say affirmatively nowthat auditing reinforces accountabilityand good governance. However, auditorscan only lay out the problems andweaknesses of the organization and itwill still require its leadership at boardlevel to use the auditors’ work to achieveaccountability and good governance.Auditors by themselves cannot achievethat.Auditors do not laugh becausethey have no teeth?Here are my experiences as Chairman ofthe PAC. A well-publicized case was theprivatization of Lumut Naval Dockyardand building of offshore patrol vessels forMalaysian Navy by a private entity. Thecost overruns and failure of the privateentity to deliver was already an obviousand indisputable fact. The ones that hadto bear the failure were the employeessince they were subsequently offeredVSS. No consequences suffered by thosereally responsible for the financial andmanagement.Another celebrated case would be theMatrade Building, a landmark buildingcosting RM167 million that could notbe occupied and requiring more moneyto make it usable. These facts were notdisputed but nobody was ever heldaccountable for the massive cost overrun.In the case of the famous MRR2 elevatedhighway, the opinion of PAC that repairworks should begin immediately wasignored. It required the Prime Ministerto intervene and the affected portionwas closed for repairs two weeks ago.The choice of the method of repairs isstill mired in confusion over whetherresponsibility for operational decisionsis political or professional. We have theultra-modern hospital in Pandan, Johoropened after 2 years delay with thedefect liability period almost over.The common theme of these projectswas they were design-and-build projects.The approach was chosen becauseprivate contractor was thought tobe far more efficient and withoutgovernment interference such projectwill be completed faster. But whenthings go wrong, there was no recourseto accountability. There were no projectaudit measures because they aretiresome and cumbersome. Privatizationwas implemented without any auditingmechanism.We cannot laugh because wecan only cry?When I look at my old photos as CabinetMinister in Parliament till 1987, theyshowed my huge smile, but now seldomsmile. No good jokes and laughter atPAC meetings. We were serious peoplelistening to horror stories!The PAC’s task is to discuss auditedreports of government departments andagencies ensuring that monies approvedby Parliament are indeed well spent. Weare looking at problems highlighted inaudit reports. We have the assistance ofthe Auditor General and the NationalAudit Department which is very criticalfor the functioning of the PAC.buletin AUDIT