The SAI audit professional: subject matter expert or generalist?
As SAIs we aim to influence the management of public funds to ensure they impact the lives of citizens. What does this mean for the profile of an audit professional? What should they know and what should they be able to do?
I began my career working on private sector audits. When I joined the Auditor General South Africa (AGSA) I read everything I could to understand public sector auditing. I discovered that while my expertise in accounting and auditing was essential to my position, I had limited knowledge of the ISSAIs, the public sector environment and public financial management.
As a professional, I knew I needed to take responsibility to gain the expertise I needed to be effective in my role. This led me on an enriching learning journey. Nonetheless, the previous ten years that I had spent developing my competence in accountancy and financial management were essential to my ability to add value at my SAI.
SAI audit professionals need to be competent at more than just auditing. ISSAI 100 (para 26-27) introduces the concepts of subject matter and criteria. It will be difficult for an auditor to be effective in their role if they are not well versed in the subject matter and criteria of their audits.
In my work supporting professionalisation efforts at the AGSA, AFROSAI-E and the CBC’s Task Force for INTOSAI Auditor Professionalisation, I have found that it is important to differentiate between two distinct competency categories:
- Auditing competencies: the knowledge and skills needed to apply the ISSAIs or other auditing standards. These are the focus of the INTOSAI CBC’s competency framework.
- Subject matter/criteria competencies: the knowledge and skills needed to understand the auditee and its environment, to interrogate the subject matter being audited and to apply the criteria against which the subject matter will be measured. These competencies will vary between audit types.
The individuals in audit teams should collectively possess the knowledge and skills necessary to successfully complete the audit (ISSAI 100 para 39). SAIs should evaluate how this directs their hiring and learning practices, considering both auditing and subject matter/criteria competencies. It is reasonable to expect a SAI to teach a subject matter expert how to audit. It will usually be difficult to teach subject matter expertise to an auditor and such expertise may need to be recruited into the SAI.
For SAIs to make recommendations that are authoritative and impactful, they need professional staff who have the expertise needed to (i) scope and plan relevant audits; (ii) execute audit work and identify value-adding audit findings; and (iii) write influential reports. While external experts may assist with the second area, internal expertise is needed to ensure the right decisions are made about what to audit and how to report findings.
In a fast-changing world, SAIs should continuously monitor the adequacy of their internal expertise and support all their staff to continuously develop their individual subject matter expertise through a commitment to life-long learning.