A Practitioner's Guide to Corruption Auditing

The Role of Internal Auditors and Government Auditors

About the Author

Khan photo

      Muhammad Akram Khan

B.Com (Hons), M.Com, (Punjab), M.Sc (UK), Fellow Canadian Comprehensive Auditing Foundation (Canada)
Email: Muhammad Akram Khan <makram100@yahoo.com>

Muhammad Akram Khan, a pioneer in the effective use of Performance Auditing, is an Audit Professional with over 35 years of experience.  Pleier Corporation published his CD A Practitioner’s Guide to Performance Auditing in 2005. The Guide has been well received by the profession. Now he has distilled his life-long experience and produced A Practitioner’s Guide to Corruption Auditing. This is the first ever step-by-step full length guide on corruption auditing. Most of the auditing literature discusses fraud auditing.

Corruption auditing has not received the attention of the profession so far. Mr. Khan is the pioneer in developing this Guide for the first time.

The Guide takes the auditors step-by-step on their usual path of planning, executing and reporting of an audit and tells a way out for auditing against corruption where usual documentary evidence is not available. It is profusely illustrated with graphics and real-life case studies, emanating from the author’s vast experience.

Mr. Khan developed the Performance Auditing Methodology used by the Department of the Auditor General, Pakistan. For years he served as the Director General of Performance Auditing in the Department of the Auditor General of Pakistan.

Mr. Khan is currently Chief Resident Auditor at the United Nations Mission in the Sudan (UNMIS).

During 2002-03, Mr. Khan consulted with the Government of Pakistan and developed a Strategy for Introducing Internal Audit in the Federal and Provincial Governments. He also wrote a state-of-the-art Government Internal Audit Manual for the Government of Pakistan. Besides, he drafted Internal Audit Law also for the Government of Pakistan.

Before joining the United Nations Office of Internal Oversight as Chief Resident Auditor in June 2003, he was Deputy Auditor General of Pakistan. He has a diversified experience of working in the public sector at a senior level. He worked as Additional Secretary in the Ministry of Finance, Government of Pakistan. For over two years, he served at the apex level as Member Finance in the Pakistan Telecommunication Authority, a regulatory body for the telecom sector.

In the Department of the Auditor General of Pakistan, where he spent about  three decades, he held various positions from Assistant Director of Audit to Deputy Auditor General.

His international experience includes work as Chairman Board of Auditors, Economic Cooperation Organization Tehran (Iran) in 1996 and Member of the said Board during 1995-97. He was Member of the Board of Auditors for the Organization of Islamic Countries, Jeddah during 1995-97.

Mr. Khan also served as Alternate Governor of the Islamic Development Bank Jeddah (Saudi Arabia) during 1999-2000.

Besides, he was a visiting professor on performance auditing in the International Islamic University Malaysia during 1992-93. He has a been regular speaker on performance auditing for training programs of senior executives and middle managers in the National Institutes of Public Administration, and Administrative Staff College for senior bureaucrats, both at Lahore, Pakistan.


His previous experience includes the delivery of numerous training courses and workshops for auditors in Pakistan, Saudi Arabia, Malaysia and China. Responsible for training auditors of all levels in the Department of the Auditor General of Pakistan during 1991-95, he trained hundreds of auditors in scores of professional courses, developed training material for various programs, and wrote a training manual for the department of the Auditor General of Pakistan.

Mr. Khan has audited various departments and ministries of the Government of Pakistan including Post Office, Railway, Telephone, Public Works, Public Enterprises, and Foreign Missions.

Mr. Khan is well known internationally for representing Pakistan at over 44 international conferences. He represented Pakistan at UNCTAD’s Intergovernmental Group of Experts on International Standards of Accounting and Reporting (ISAR) at Geneva during 1998-2000.

His contributions to the Internal Audit Profession include his extensive writing consisting of 20 books / booklets and 44 research papers – click the current vitae link below for a partial listing.

He is Fellow of the Canadian Comprehensive Auditing Foundation, Ottawa, Canada, Sponsoring Governor of the Association of Accounting Technicians (Pakistan Institute of Public Finance and Accounting), and Member of the Institute of Internal Auditors, Florida, USA.

Mr. Khan has Master of Science degree from both the University of Aston in the United Kingdom (1970) and Master of Commerce degree (1967) and Bachelor of Commerce (Honours) (1966), both from Hailey College of Commerce, University of the Punjab, Lahore, Pakistan. He won several distinctions including four Gold Medals and two Silver Medals for his excellence as a student. 

In A Practitioner’s Guide to Corruption Auditing Mr. Khan shares the vast amount of knowledge he has gained about this important subject in his 35 years of experience.

Click here for complete current vitae.



A Practitioner's Guide to Corruption Auditing


This 164-page publication is designed specifically for Internal Audit Professionals and Government Audit Professionals
who would like to improve their auditing effort in the area of Corruption Auditing but need a comprehensive approach as the "standard audit tools" simply are not effective.  The Guide provides a framework for how internal auditors and government auditors can effectively audit corruption by diversifying the toolkit they use.

Click here to review the Preface of this publication.

This publication contains in one place the information audit practitioners are seeking about how to start addressing the growing concern about corruption auditing including the following:

Chapter One: What is Corruption Auditing?

Corruption Auditing and NOT Fraud Auditing  

General Lack of Concern with Corruption Auditing

Auditors’ Dilemma

Organizations Where Internal Auditors Have a Role

Scope

Type of Corruption the Auditors Can Deal With

Audience of the Guide

Enabling Environment for Audit against Corruption

Chapter Two: Global Concern

Recent Upsurge in Anti-Corruption Efforts

Causes of Corruption

Economic Impact of Corruption

Chapter Three: Corruption and the Auditor

Defining Corruption

Defining Governance, Accountability, Transparency and Integrity

INCOSAI Observations and Recommendations

Auditors’ Role With Respect to Corruption and Fraud

Corruption and Evidence   

Corruption and Collusion

Corruption and Discretion

Role of Auditors in Corruption Investigation

Preparing the Auditors for Fight against Corruption

Chapter Four: Planning for Corruption Auditing 

                    Audit Objective

                    Corruption Audit Planning Process

                    Knowing the Audit Entity

                    Developing Audit Criteria

                    Building Inventory of Corruption Opportunities

Applying Corruption Opportunity Test

Defining Most Likely Areas of Corruption

Developing Audit Plan

Chapter Five: Criteria for Corruption Auditing 

Audit Criteria for Procurement

Procurement of Goods and Services

Procurement of Short Term Consultancy Services

Procurement of Consultancy Services for Regular Appointment

Procurement of Space on Lease

Audit Criteria for Good Governance

Audit Criteria for Public Performance Reporting

Audit Criteria for Human Resource Management

Code of Conduct   

Recruitment

Promotion

Transfer

Foreign Training and Posting

Financial Disclosures

Salaries and Pensions

Protection of Whistleblowers, Witnesses and Experts

Chapter Six: Building Inventory of Corruption Opportunities

Indicators of Corruption: General Administration

Indicators of Corruption: Procurement

Indicators of Corruption: Capital Works

Indicators of Corruption: Human Resource Management

Indicators of Corruption: Privatization

Indicators of Corruption: Ministry of Finance

Indicators of Corruption: Government Audit Departments

Indicators of Corruption: Revenue Collecting Departments

Indicators of Corruption: Judiciary

Indicators of Corruption: Education

Chapter Seven: Applying the Corruption Opportunity Test

Developing the Corruption Opportunity Test

Corruption Opportunity Test Exercise

Illustration: Applying COT to Procurement Function

Chapter Eight: Executing Corruption Audit

Audit Program

Confirming the Understanding

Client or Public Surveys

Employee Surveys

Designing Client or Public Surveys

Some Tips for Executing Corruption Audit

Chapter Nine: Using performance audit as a Tool of Corruption Audit

Indicators of Corruption Highlighted By Performance Audit

Preventive Role of Performance Auditing

Limitations of the Performance Auditor

Chapter Ten: Reporting Results of Corruption Audit

Possible Recommendations

General Administration

Procurement

Capital Construction Works

Human Resource Management

Privatization

Ministry of Finance

Government Audit Departments

Income Tax, Customs, Land Revenue and Other Revenue Collecting Departments

Judiciary

Education

Chapter Eleven: Strengthening Supreme Audit Institutes

                    The Current State of SAIs

                    Proposed Action

Annex-I: INCOSAI Recommendations on Prevention and Detection of Fraud and Corruption

Annex-II: Information to be Called from Candidates at the Time of Recruitment

Annex-III: Checklist for Verifying Antecedents of Candidates for Employment

Bibliography of 65 References used in This Publication


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