As practitioners have theorised, auditing is a central element of any accountability system. It verifies and legitimizes the information based on which organizations are to be judged. Whenever audits are performed well, they help public institutions to act in accordance with the principles of accountability and integrity, improve their performance and earn the confidence of the Ghanaian citizenry. In the real sense, countries have established national audit institutions to monitor the financial operations and performance of public sector institutions. These national audit institutions are referred to as Supreme Audit Institutions (SAIs). In Ghana, the national audit institution is the Ghana Audit Service (GAS). Therefore, GAS, as a noble office, is a SAI that subscribes to the International Organization of Supreme Audit Institutions (INTOSAI). GAS is headed by the Auditor General who is mandated to audit the public accounts of Ghana and all public offices, thus, Ministries, Departments and Agencies including Metropolitan, Municipal and District Assemblies, Public Corporations, Companies and Organizations established by an Act of Parliament and report the findings to Parliament. GAS is therefore the monitoring and accountability organ of the state, and the SAI of Ghana. These SAIs are key components of the formal system of financial accountability in many countries. As the institution in charge of auditing government revenues and expenditures, the GAS acts as the watchdog over the country’s financial integrity with the mandate to assess whether public funds are managed in an effective and efficient manner in compliance with existing laws. They are also tasked with ensuring that the government’s reported financial data is credible and of good quality.
SAIs themselves are not considered anti-corruption bodies as they are not explicitly charged with detecting or investigating corruption. This equally applies to GAS. However, the four core objectives of INTOSAI are highly relevant to the fight against corruption. These are the proper and effective use of public funds, the development of sound financial management, the proper execution of administrative activities and the communication of information to public authorities and the general public through the publication of objective reports. GAS derives its mandate from the 1992 Constitution as well as other acts or laws, especially the Audit Service Act, 2000, Act 584, which established GAS. This Act regulates and contains a number of provisions that specify the audit functions of GAS, including the performance of certain audit tasks.
AS provides audit or assurance services by comparing economic information with a framework for financial reporting, and to produce knowledge derived from the conduct of audit investigations, which creates the basis for the implementation of corrective actions. In other words, GAS has a commitment to ensure accountability in government finances. It is also empowered to audit the use of public money, resources and assets, the collection of revenues owed to the government or public entities, the legality and regularity of public institutions’ accounts and the performance of public institutions in terms of value for money. Based on this core mandate, the GAS has the mandate to conduct three types of audits; financial audits that focus on providing a financial opinion on the annual accounts of public institutions, compliance audits that seek to verify the legality of the transactions made by public institutions and performance audits that assess the efficiency and effectiveness of public institutions’ use of resources.
Corruption is the abuse of entrusted power for personal gain or for the beneﬁt of a group to which one owes allegiance. Corruption is a menace that produces detrimental effects on society, democracy and the economy. Whereas it is widely considered a critical issue to be addressed in Ghana, there is not a single measure that can curb corruption. Several institutions must work together to ﬁght it. As the watchdog of the country’s public financial management, the Auditor General (AG), the ultimate head of GAS, has a key role to play in efforts to curb corruption in Ghana. In fact, the AG is the guardian of the public interest and often enjoys greater levels of citizen trust. As such, some scholars argue that this legitimacy position should give him the needed impetus to promote transparency and ethical conduct in the public sector. More specifically, the AG can contribute to anti-corruption approaches in two main ways, through deterrence and detection.
Deterrence principle emphasises that the AG should be more proactive in his functions, in order to recommend practical measures to be implemented, to prevent corruption. The AG should endeavour to create an environment that is unfavorable to corruption. The AG contributes to the prevention of corruption by promoting sound public financial management systems based on reliable reporting and robust control mechanisms, which contribute to support transparency and accountability in the public sector. By contributing to a system of financial checks and balances, the AG should provide the public with information on acceptable standards of financial management, thereby promoting a stronger framework to support financial integrity and predictability of government operations. As such, the AG can play an important role in raising awareness to the risks of corruption and promoting good governance and standards of financial integrity. The disclosure of wrongdoing through the publication of audit reports can also have a deterrent effect and discourage public officials from engaging in fraudulent or corrupt practices. However, Mr. Osei-Kyei Mensah, the Minister for Parliamentary Affairs has a dissenting view. On the 18th of December 2019, Mr. Osei-Kyei Mensah emphasized that the AG is a tool for Parliament in exercising its oversight responsibilities and urged the outfit to make its findings and reports available to Parliament, before making them public. Meanwhile, once the AG’s audit results have been made public, citizens are able to hold the custodians of public purses accountable. In this way, the AG promotes the efficiency, accountability, effectiveness and transparency of public administration. An independent, effective and credible office of the AG is therefore an essential component in a democratic system where accountability, transparency and integrity are indispensable parts of a stable democracy.
While the primary responsibility for the detection of corruption lies with institutions such as the police or anti-corruption agencies, the Ghanaian public expects the AG to play a key role in uncovering malpractices of public servants, civil servants and government appointees. Indeed, auditors are experts in detecting fraudulent financial reporting which can conceal corrupt activities. Falsified statements and claims, illegal bidding practices, tax and customs evasion, overpayment and non-delivery of goods and services as well as malpractice in the liquidation of public companies are some of the fraudulent and corrupt activities that auditors may encounter. While the AG has limited capacity and authority to investigate cases of corruption, he should be mandated to pass cases on to the relevant authorities for investigations. Some countries, such as Germany, Sweden and the UK, explicitly require their SAIs to report instances of suspected corruption. Corruption may be detected during all three types of audit: financial, compliance and performance. The primary purpose of financial audits is not to detect corruption but to ensure that financial statements are not misleading and reflect an organization’s genuine economic transactions. Having said that, inaccurate or incomplete statements can indicate fraud, embezzlement or corruption. This is one of the reasons why people do advocate that the AG must be granted prosecutorial powers to deal with such matters.
In practice corruption is more often revealed through compliance audits, which are designed to ensure the legality of financial transactions and verify that they comply with existing laws, rules and regulations. Breaches of laws and regulations may indicate fraudulent or corrupt activities. Similarly, performance audits that assess the management of public resources can be designed to include some references to laws and regulations and thereby help identify fraud and corruption. Indeed, when a project or programme exceeds its planned costs, it takes longer than expected or fails to achieve the planned results, this could be a red flag and merit further investigation to ensure probity. Public audits can have the potential to reduce corruption drastically, especially in a situation where the AG is entrusted with greater sanctioning powers.
The AG can contribute significantly to improving the efficiency of governmental activities and have a notable influence on the perceived level of corruption in the country. The more extensive the AG’s work, the more it contributes to reducing corruption. However, the effectiveness of the AG depends on the extent to which his recommendations are acted upon by the relevant actors, be the Public Accounts Committee, the courts or law enforcement agencies. Unsurprisingly, this varies widely depending on the context. More recently, an evaluation of government anti-corruption audit programmes aimed at uncovering the misuse of public resources at the local level in Brazil showed that audits can be an effective tool to reduce corruption. They posited that elected public officials may refrain from corruption if they are concerned that audits will increase the probability of their corrupt behaviour being exposed to the voters and compromise their re-election. Alongside an adequate mandate, the level of independence the AG enjoys is a key determinant of his ability to counter corruption.
The AG’s office is considered to be one of the so called “integrity pillars” of the policy response against corruption. In their professional practices, they contribute to the effective management of public spending, ensure transparency in the use of public funds, ﬁnancial accountability and strengthen the democratic institutions. Transparency and accountability are important to prevent public sector corruption, while effective auditing helps to reduce misrepresentation and provide assurance for accounts to be trusted. Not only does the AG preach his anti-corruption practices based upon his own volition but international pressures from institutions like the World Bank, the Organization for Economic Co-operation and Development (OECD) and the International Organization of Supreme Audit Institutions (INTOSAI) descend on him to thread that pathway. The INTOSAI which provides a forum for state auditors, has shown a growing commitment in promoting anti-corruption audit practices in SAIs. While the AG shows a growing interest in ﬁghting corruption, his capacity to do so nevertheless remains uncertain, since both his mandate and investigative powers are limited. We should not forget that an effective SAI also relies on an effective Parliament and a free and independent media that can publish its audit ﬁndings.
There are best practices in involving audit institutions in anti-corruption work. There are few emerging principles on how to involve SAIs to help counter corruption. These include risk-based auditing, coordination with other anti-corruption institutions and law enforcement, and engagement with the public, among others. It is therefore appropriately established that the AG should constantly engage the public on matters of anti-corruption and corruption risk assessments. The AG should always play the role of detecting corruption by identifying and monitoring corruption “hotspots”. By focusing audit efforts on areas known to be susceptible to corrupt practices, such as public procurement, the AG can assist other anti-corruption players by producing hard financial information. However, coordination between a SAI and other agencies in this part of our world is, however, not always straightforward. The difference in mandates and also the rivalry between different agencies can have significant impact in the fight against corruption. In Ghana, the government intended to lessen the burden on existing anti-corruption agencies and remove the institutional roadblocks that exist as hindrances to the fight against corruption. With the end result being to make anti-corruption agencies in the country more effective at discharging their duties, the Office of the Special Prosecutor of Ghana was established by the Office of the Special Prosecutor Act, 2017 (Act 959). This office is an independent investigating and prosecution body to make inquiries into corruption. Mr. Martin Amidu, the Special Prosecutor, has continuously expressed his dissatisfaction of non-cooperation from other institutions. Inter-agency rivalry has been a consistent feature of the country’s anti-corruption efforts. In Nigeria, for example, the lack of cooperation between different anti-corruption bodies is seen as one of the main problems in President Muhammadu Buhari’s anti-graft campaign. The State Audit Office (SAO) of Hungary, for example, contributes to the fight against corruption in three major ways. First, during its audits, the SAO pays special attention to the identification of corruption risks and takes them into consideration at the audit planning stage. The SAO also compiles summary reports by examining corruption trends, assessing corruption risks and analysing the reasons for corruption. Finally, the SAO initiates the sanctioning of corruption when evidence is well-established by referring its findings to relevant authorities such as the police or prosecutor’s office.
In Ghana, the AG has the power to surcharge perpetrators of financial malfeasance of quantum of funds involved. However, this practice is not of any punishment since others equate it to a self-granted loan being repaid at the time the surcharge is invoked. In addition to the surcharge, the AG should be empowered to refer suspicions of fraudulent and criminal activities uncovered during their routine audits to the police and other competent authorities. In practice, cross-agency coordination of anti-corruption activities remains weak in Ghana. To address this issue, some countries have established specific coordination bodies and law enforcement agencies. In Bulgaria, for example, the Inter-ministerial Commission for Coordinating Actions against Corruption has been established, while in Bolivia, this anti-corruption coordination mandate was given to the SAI itself.
To conclude, the office of the AG yearns for improved cooperation with the legislative and the executive arms of government, in order to bring about a significant change in audit outcomes for the better but not to side-step the functions of Parliament. The office of the AG is well known for its independence, objectivity and professionalism, and consequently enjoys nationwide recognition. Tracing the evolution of government from hierarchical bureaucracy to democracy with multiple stakeholders, the tasks of public sector managers have been transformed from direct control to balancing the interests of the public stakeholders. With this, nothing should be done to compromise the professional independence of the office of the AG. The stature of the AG is revolutionizing the public sector, seriously changing them from being budget maximizing managers, to being cost-conscious and revenue-hungry organizations. In response to widespread citizen dissatisfaction of perceived corruption in the state institutions, the AG is a professional personality destined for ingenuity and thoughtfulness over a disturbingly poor consequent financial management culture within the public sector. According to Patricia Moreira, the Managing Director of Transparency International, corruption chips away at democracy to produce a vicious cycle, where corruption undermines democratic institutions and, in turn, weak institutions are less able to control corruption. Moreover, it has been found out that more than a trillion dollars are stolen from developing countries every year, which is such a vast sum that it is hard to visualize. It is therefore appropriate to put strings together to help the AG and all other anti-corruption institutions to fight corruption in Ghana.