Local Government Audit: It's a Whole New Ball Game

Article Abstract:

Many large accounting firms have accepted positions in local government audits. This seems inconsistent with their fear of litigation as audits in the public sector increase responsibilities of the auditor making him more susceptible to litigation. The availabity of public sector accounting to private sector firms is a controversial issue mainly due to possibilities of a conflict of interest. The public sector auditor is required to resolve items for legality. Auditors have been associated with fraud detection and exposure of corruption. There is responsibility for assuring proper arrangements' for value for money. However the Commission's Code of Audit Practice is not clear on how to determine this. Accountability to the public is a responsibility of the public sector accountant that is not a concern of a company auditor.

United Kingdom

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Forget the Jargon, Let's Communicate

Article Abstract:

Research by Ralph Estes, an American professor, indicates that an audit report does not affect the behavior of the investor. The language has become so standardized that it is not attended to. Estes proposes rejuvenating the language in the audit report. Users and preparers must be getting the same message in language usage. It appears that users are inferring too much due to the nature of an audit. It is not logical to conclude that if one audit report is not understood that allowing a variety of audit reports would make them comprehensible. Several committees and associations have studied alternate audit reports without success, as yet. This type of study should continue.

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Public sector audit challenge

Article Abstract:

Public sector auditors must create and maintain relationships with an audited body while remaining independence. The National Audit Office, created by the National Audit Act of 1983, works with the UK Parliament and is guaranteed operational and financial control. Because of increased privatization and decentralization in public sector entities, there is a trend towards adopting a more commercial approach to public sector accounting. The challenge to public accountants lies in increasing value to clients. Public accountants must tailor cost-effective recommendations to the needs of the audited organization to improve their financial performance and public accountability.

Analysis, United Kingdom. National Audit Office

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