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Public Procurement Audit in African Countries

Public Procurement Audit in African Countries

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Published by umboni
Mau Anga
Mau Anga

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Categories:Business/Law, Finance
Published by: umboni on Apr 08, 2010
Copyright:Attribution Non-commercial

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03/04/2013

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PUBLIC PROCUREMENT AUDIT IN AFRICAN COUNTRIESBy: Gerald U.G. MabvekaPublic procurement is an activity that is implemented through the expenditure offunds in the procurement of goods, services and works to be used by the government. In financial management, the institutions that have spent the funds have tobe audited to establish if the funds were spent as intended. On a different point, procurement activities have to be audited to establish if the spending institution complied with procurement legislations. This activity is call procurementaudit. This article highlights how procurement audit is done in different African countries. It also discusses some of the important points that have to be part of the public procurement law on the issue of procurement audit.In Zambia the Public Procurement Act 2008 (PPA) gives the Procurement Authoritythe powers to conduct procurement audit. In the PPA 2008 section 6 (2) (f) saysthe authority;commission and undertake investigations in public procurement matters and institute procurement audits.In Uganda, procurement audit is done at different levels. In the Public Procurement and Disposal of Public Assets Act 2003 (PPDAA 2003) part II (j) the Public Procurement and Disposal of Public Assets Authority is empowered to institute procurement audit at the following levels;I.Procurement of disposal audits during the bid preparatory processII.Contract audits in the course of the execution of an awarded bid;III.Performance audit after the completion of the contract in respect of anyprocurement or disposal, as may be requiredIn Nigeria, the Public Procurement Act 2007 empowers the Bureau of Public Procurement (BPP) to conduct procurement audit. Under the function section article (p)of their Public procurement Act 2007, the bureau;Perform procurement audits and submits such report to the National Assembly bi-annually;In Botswana, the Public Procurement and Asset Disposal Board is not empowered toundertake procurement audit. In the Public Procurement and Asset Disposal Act 2001 Section 79 says;The Auditor-General, in exercise of his powers under the Cap. 54:01 Finance andAudit Act may initiate audits at any point of the procurement or disposal cycle,such as during the bid preparatory process (tender audit), in the course of theexecution of an awarded bid (contract audit), and after the procurement, when bids have been completely delivered by the contractors (performance audit).The Act gives a detailed process of procurement audit in sections 77 to 82 of the Act. This includes who should conduct the audit exercise, reporting proceduresand implementation of the recommendations made at the end.In Ghana, the Public Procurement Authority is not empowered to conduct procurement audit according to Public Procurement Act 2003. In Section 91 of the Act, theAuditor General is empowered to audit all the procurement activities. The section says;(1) The Auditor-General shall conduct annual audits of the procurement activitiesof entities and shall furnish copies of reports on the audits to the Board upon
 
request from the Board.(2) The Auditor-General shall also carry out specific audits into the procurementactivities of entities and compliance by contractors, suppliers and consultantswith the procurement requirements in this Act and regulations made under this Act at the request of the Board.(3) The statutory audit of procurement activities may be relied upon by the Boardto institute measures to improve the procurement system.In Kenya, the Public Procurement Oversight Authority has not been empowered to conduct procurement audit. Rather it is the Controller and Auditor General underSection 49 (1) (b) of Public Procurement and Disposal Act 2005. The section says;the Controller and Auditor-General, or an auditor authorised by the Controller and Auditor-General, may audit the accounts of the procuring entity and contractor relating to the contract and the procuring entity and contractor shall co-operate with and assist whoever does such an audit.Finally, in Malawi, the Public Procurement Act 2003 empowers the Auditor Generalto conduct procurement audit. In Section 39 of Public Procurement Act 2003, itsays;Procurement activities shall be subject to regular auditing by the Auditor General to ensure that public funds are expended for their intended purpose, and witha view to maximizing value received by the public purchaser, ensuring that proper and accountable systems are in place and adhered to, and identifying any weaknesses in procurementThe preceding presentation has shown that different countries conduct procurement audit differently. However, it could be discovered that the exercise is paramount to the achievement of primary objectives of public procurement. These include value for money, fair competition, transparency and accountability in the useof public funds. In addition, the exercise assists countries to identify weaknesses of their procurement systems.However, it has been noted that some countries went further to explain how procurement audit would be done. For instance, in Botswana the procurement law is more explicit on how it would be conducting the procurement audit. It clearly states how the Auditor General and the Head of public procurement body would work inconducting the exercise. It is very important to clearly come out with the relations in terms of offices that will be working hand in hand to avoid blame shifting which is common in public service.Secondly, it is important to define the reporting/feedbacking procedure. In Nigeria and Botswana, they have their public procurement laws detailing the reporting procedure of the audit exercise. For example, in Nigeria, the Bureau has to report to Parliament bi-annually. However, it could be assumed that Finance and Audit Acts of the respective countries have defined the reporting procedures in auditing.Thirdly, the public procurement law has to be clear on what stage(s) procurementaudit would be conducted. A number of countries sampled have detailed the stages procurement audit would be conducted. For example, in Botswana and Uganda, procurement audit could be conducted at bid preparatory stage, during execution (contract audit) and after the procurement activity (performance auditing). In Ghana, they conduct annual procurement audit and specific ones when need arises. TheMalawian Public Procurement Act 2003 only says that procurement activities would be subjected to regular auditing. The Audit Act defines regular auditing as an

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