Rules of Procedure, Policies and Standards of the AU BoEA

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II. RULES OF PROCEDURE, POLICIES AND STANDARDS OF THE AU BoEA

(a) RULES OF PROCEDURE OF AFRICAN UNION BOARD OF EXTERNAL AUDITORS

BACKGROUND

1. The Rules of Procedures of the Board of Auditors supplement the Articles 77 to 84 of the Financial Rules and Regulations of the African Union, that provide the terms of reference governing the external audit of the African Union.
SESSIONS

2. The Board of Auditors of the African Union, hereafter referred to as the Board, shall convene annually normally in the month of April at the AU Headquarters on days agreed to by the Board.

3. The Board may convene in like manner at such other times and places as may be necessary for the due performance of its duties or at the request of any member of the Board and as agreed to by the Board.

4. Three members, duly appointed to the Board by the Executive Council and endorsed by Assembly, shall constitute a quorum, but a member shall not be bound by any decision of policy taken in his/her absence unless he/she has had reasonable notice of the date of meeting and the matters to be considered. A member unable to attend a meeting of the Board may make his/her views on the matters to be considered known in writing, or through his/her representative, or by way of telephone or video-conferencing. The member may also request to state his/her views at a subsequent meeting.

5. A member is represented in his/her absence at a given meeting of the Board by a designated official not lesser in rank than his/her Director of Audit and this representation shall be taken into consideration in order to establish the existence of a quorum. This designation shall be addressed in writing, to the Board’s Secretary. Such designation shall confer upon the designated official all the powers and duties of the member making the designation, except those which he/she may have expressly reserved for himself/herself.

6. The Chairpersonship of the Board is based on the principle of equal sharing of the Chairpersonship, on a two-year rotational basis.

7. The Chairpersonship is assumed on 1 January every other year by the member following in seniority (member with the longest past service on the Board) to the member whose Chairpersonship term ends on 31 December of the preceding year.

8. If the member appointed Chairperson under the provisions of paragraph 6 above decides not to serve, one of the other four members, commencing with the most senior one (member with the longest past service on the Board), shall assume the Chairpersonship for the full period or the remainder of the period, as the case may be, indicated in paragraph 6 above.

9. If the Chairpersonship becomes vacant due to the Chairperson ceasing to be a member of the Board, his/her successor shall assume the Chairpersonship for the full period or the remainder of the period, as the case may be, indicated in paragraph 6 above.

10. If the Chairperson for any reason is temporarily unable to act, the member with the longest past service on the Board shall assume the functions of the Chairpersonship for the time the Chairperson is unable to act.

11. The Chairperson shall:
(a) Convene the session as provided in paragraph 2 and 3 above.
(b) Prepare the provisional agenda for the meetings, with the assistance of the Secretary to the Board, upon the advice of the Audit Operations Committee.
(c) Conduct the meetings of the session.
(d) Vote only as member.
(e) Issue such correspondence on behalf of the Board, as may be required.

INDEPENDENCE AND ETHICS

12. The Board members and the auditors are independent of the management of the African Union and its Funds and Programmes. They neither seek nor receive instructions from an individual member state. Each Board member ensures that his/her auditors are perceived to be so independent, that they strive to be objective in dealing with the audit issues and that are free of personal interest and any external pressure, basing conclusions exclusively on audit evidence obtained in accordance with relevant standards.

13. The position of Board member, Director of audit or auditor for the Board is incompatible with any office, duties, mandate or participation in any organ of the AU, its funds and programmes and other entities audited by the Board. AU employees do not participate in the decisions related to the contents of the audits, draft management letters and reports.

14. Each Board Member ascertains that the conduct of his/her auditors shall be in conformity with the INTOSAI Code of Ethics and principles, IFAC Code of Ethics and other generally accepted professional standards.

15. A Board member, director of external audit or auditor shall disclose to the Board any close relationship with the African Union, its funds and programmes and other entities audited by him/her, their directors, officers or employees.

16. A Board member, Director of audit or auditor should refrain from communicating their individual positions to third parties on such matters that are to be considered or are under consideration by the Audit Operations Committee or the Board.

17. A Director of audit or an auditor should not meet in an official capacity with Member State representatives and other third parties regarding the work of the Board or related thereto either directly or indirectly, without informing and obtaining the consent regarding any substantive position to be taken by the Board.

18. The deliberations and the minutes of the Board are confidential.

REPRESENTATION OF THE BOARD

19. As a rule, the Chairperson shall be the Board’s representative, but if for any reason it is impracticable for him/her to do so at any conference or meeting, one of the other four members, commencing with the most senior one (member with the longest past service on the Board), shall do so. This rule of procedure shall not be construed as restricting the right of any member to attend any such conference or meeting. It is the duty of the Chairperson and of the Secretary to the Board to give notice to all members of the Board of any such conference or meeting.

20. The Board shall not be bound by any expression of personal opinion or voluntary undertaking by its member representative.

21. At the Permanent Representative Council, Executive Council and Assembly, or similar meetings of Policy Organs, the Board shall normally be represented by the Chairperson. The Chairperson of the Board will be assisted, for replies to substantive questions, by the Chairperson of the Audit Operations Committee and/or the Director of audit representing the Lead Auditor.

22. The Chairperson and the Secretary to the Board shall promptly transmit to each member of the Board and of the Audit Operations Committee copies or summaries of all important communications issued or received by him/her.

AUDIT ASSIGNMENT ALLOCATION

23. The Board continually assesses whether the evolution of the African Union institutions warrants a change in the audit assignment allocation and arrangements. In case the scope or structure changes fundamentally, the audit arrangements are considered and updated, if necessary.

24. The Board shall annually, or whenever necessary, decide who will conduct each audit. This allocation will then be communicated to the Advisory Sub-Committee on Audit Matters for its information.

25. In the event that only two members participate in the performance of a function and they disagree, the circumstances and the respective opinions shall be jointly stated to the Chairperson. No further action shall be taken until that chairperson communicates his views.

THE AUDIT OPERATIONS COMMITTEE

26. The Audit Operations Committee (AOC) shall comprise the five Directors of Audit of each member of the Board and the Secretary to the Board as an ex officio member. The chairperson of the AOC shall be designated by the chairperson of the Board of Auditors.

27. The Audit Operations Committee reaches agreement by consensus, or makes decisions by a majority of three of the five directors of external audit. The Secretary to the Board does not take part in the vote.

28. The Director of Audit in charge of the audit shall circulate each draft management letter to the other members of the Audit Operations Committee. The absence of any written comment within a period of seven working days implies approval of the draft. A director of external audit may request a delay or a meeting of the Audit Operations Committee to further examine a draft. It is the duty of directors of external audit to circulate draft management letters at appropriate times to give the other directors a reasonable opportunity to duly consider them within the five working day period.

29. Each draft report of the Board shall be examined in at least one formal session of the Audit Operations Committee.30. A Board member may designate in writing a representative ad interim, in exceptional cases, to the Audit Operations Committee, when the director of audit is unavailable due to circumstances beyond his/her control. The representative ad interim enjoys the same powers as the director of external audit he or she represents. The members of the Audit Operations Committee individually, and the Audit Operations Committee collectively, shall plan their work in a manner that limits the need for such ad interim designations.

CONDUCT OF THE AUDITS

31. Each Board Member ascertains that the auditors have a thorough knowledge of, and experience in auditing and examining public sector operations in accordance with the International Standards on Auditing and the tasks entrusted to them, and a good working knowledge of at least one of the official working languages of the African Union. As such, each auditor shall hold the designations and qualifications required within his or her nation to carry out the task of public or private sector external auditing in line with the afore-mentioned standards.

32. Each Member of the Board is free to determine the scope, methods and resources required to conduct an audit, in accordance with the framework, budget, audit plan and audit manual of the Board. The objective should be to obtain the necessary assurance, in compliance with the applicable auditing standards and guidelines, in the most efficient manner.

33. The Board decides on requests through the Executive Secretary, from the Policy Organs, Advisory sub-committee on Audit matters, Advisory sub-committee on Administrative, Budgetary and Financial matters and the AU Commission to perform specific or additional audit work in line with the specific procedures adopted by the Board.

34. The Board Members shall not provide non-audit services to the African Union unless formally decided by the Board.

REPORTS

35. In addition to the audit findings reflected in the management letters issued by the Directors of Audit addressed to the Chairperson of AU Commission or appropriate Heads of Organs, the Board shall issue and transmit separate reports to the Executive Council, or other concerned Policy Organs, in accordance with Financial Rules and Regulations. The Board of Auditors shall issue a report on the audit of the financial statements and relevant schedules relating to the accounts for the financial period, which shall include such information as the Board deems necessary with due regard to provisions in the FRR.

36. During the performance of an audit allocated by the Board to a member, no undertaking, recommendation, or direction given to the Management of any AU organ audited by the Board should be deemed to be that of the Board unless it is contained in a management letter duly considered by the Advisory Sub-Committee on Audit Matters, or included in a Board’s report to the PRC or other appropriate policy organ.

37. The reports of the Board of Auditors shall be transmitted to the Assembly through the Advisory sub-Committee on Audit Matters, together with the audited financial statements, in accordance with any directions given by the Assembly. The Advisory sub-committee on Audit matters shall examine the financial statements and the audit reports and shall forward them to the Assembly with such comments as it deems necessary. The reports of the Board to the Assembly shall be prepared in draft form by the Audit Operations Committee for the review and approval by the Board at its sessions prior to submission to the Advisory sub-committee on Audit matters. In addition, each Director of Audit has the responsibility to ensure that draft management letters and draft reports submitted to the AOC are of a high quality and of the same standard as when these audit outputs are, once adopted, transmitted to auditees.

38. Upon approval by the Board of the reports, the Secretary to the Board shall distribute copies of the reports to the appropriate officials and committees or organs of the Union.

39. Final Reports of the Board shall be prepared in English. They are then translated in the other working language of the African Union (French, Arabic, and Portuguese)

40. Except with unanimous consent, the draft of a document to be signed by the Board shall not be considered until the members have had five working days to study it. After a report is signed by the Board members, no alterations may be made in the text, save to correct typographical or other obvious errors, without the consent of the Board.

41. The Chairperson of the Board and the Member who is the Lead Auditor for a particular audit are designated as such in the pages to be co-signed by the Board members.

42. In the event that an audit opinion or report of the Board is signed by less than the three members, there shall be associated therewith a certificate of the other member or members of the Board to the effect that the relative audit programme had been approved by the Board and that all special instructions given by the Board were carried out.

QUALITY ASSURANCE

45. Each Board member is responsible to ensure that the audits assigned to them are in compliance with the applicable international standards and are performed in an economical, efficient, and effective manner; that to that effect professional and ethical standards are maintained in the audits through their in-house quality assurance programmes or systems.

46. The Board members do so by adherence to (a) the International Standards on Auditing issued by the International Federation of Accountants and (b) the Auditing Standards of the International Organisation of Supreme Audit Institutions (INTOSAI).

47. To ensure that quality of the Board’s reports, they will be subject to a peer review by the Audit Operations Committee and the Board of Auditors, as provided for in these rules and procedures.

48. Upon completion of an audit, each board member who is the lead auditor on a particular audit will be required to sign a certificate to confirm that the requirements of the ISAs have been complied with in relation to the achievement of the following objectives of the ISAs in conducting an audit of financial statements:
(a) to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error
(b) to express an opinion on whether the financial statements are prepared, in all material respects, in accordance with the applicable financial reporting framework
(c) to report on the financial statements in accordance with the audit findings.

49. A failure to achieve an objective should be properly documented by identification of the failure and details of its nature and cause in the certificate to be provided by each board member.

SECRETARIAT TO THE BOARD

50. The Secretary to the Board manages the work of the Secretariat to the AU Board of Auditors.

51. The AU Commission shall appoint competent staff to serve as Secretary to the Board as well as appoint an administrative assistant to provide secretarial duties to the Board.

52. Regarding audit matters, the Secretary to the Board will assist in all possible ways deemed appropriate, the Board of Auditors and the Audit Operations Committee in the development and implementation of audit policies and procedures, on administrative matters and financial practices and procedures in the African Union, on past discussions, decisions, work of the Office of Internal Audit (OIA).

53. Regarding information-gathering, the Secretary to the Board prepares periodic information reports for the members of the Board on senior management changes, audit-related policy decisions, etc., taken by Management and the legislative authorities. The Executive Secretary maintains close liaison with the Secretariats of the Advisory sub-committee on Audit matters, the Permanent Representative Committee, and OIA to ascertain the extent of work, if any, being done on items or areas of interest to the Board, as well as facilitate the scheduling of meetings, and undertakes assignments as requested by the Members of the Board and by the Audit Operations Committee.

54. Regarding Board and Audit Operations Committee meetings, the Secretary to the Board (a) Plans and organizes the work of and assists in conducting the proceedings of the sessions including preparation of the agenda and related documents for discussion and drawing the attention of the Chairperson and members on policy decisions, discussions, etc., arising from the intergovernmental legislative bodies that may be relevant to the work of the Board (b) Assists in the transmission of queries to the AU offices, in the formal editing of the Board's reports and memoranda, and in the distribution of the Board's questions to and replies from the Offices of the AU (c) Communicates and coordinates the attendance of participants at Board meetings as required; (d) As an employee of the AU, the Secretary, while preparing summary records of the meetings, does not participate in the Board’s and Audit Operations Committee’s decisions related to the contents of the draft management letters and reports.

55. The Secretary to the Board takes appropriate measures to guarantee the full confidentiality of the Board’s and the Audit Operations Committee’s deliberations and minutes, which may be consulted only by their members and by auditors designated by them.

56. Regarding administrative responsibilities, the Secretary to the Board (a) Renders support to the Chairperson of the Board and of the AOC; (b) Maintains the Board’s management letters and reports database and a permanent record of the discussions, resolutions and decisions of the Assembly with audit implications and informs Members of the Board accordingly; (c) Ensures a comprehensive and current permanent record of parliamentary and other documentation (inter alia management letters, Financial Rules and Regulations, etc.) for use by the Board and its staff as well as records relative to the activities of regular and special sessions of the Board (d) Prepares the Annual budget proposals of the Office and for the Board of Auditors, for approval by the Audit Operations Committee and the Board and submit it to the Financial Controller of the Union to be included in annual Union budget.

RECORDS, DATABASE AND WORKING PAPERS

57. All records of the Board not contained in official documents of the AU, such as minutes of the sessions of the Board, rules of procedure and the like, shall be part of the permanent, confidential records of the Board under the custodianship of its secretariat. General correspondence and memoranda formally issued by members of the Board, of the Audit Operations Committee and the Secretary to the Board shall be subject to disposal action after a period of four years. They shall not be communicated to outside parties unless the Board or the Audit Operations Committee agrees to do so.

58. Reports and audit working papers of whatever nature related thereto or to the activities of the Board are the property of the Board and shall be kept in such places and in such manner as the Board may direct. Until final action is taken by the appropriate authority with respect to the Board report, each person who signed a report of the Board, or his/her successor, shall have right of access to all papers and documents, including in an electronic form, relating thereto notwithstanding the fact that he/she may no longer be a member of the Board, or after a similar period with respect to reports submitted to policy Organs.

59. A database of the management letters and reports, replies and relevant documents is maintained by the Board, for the use of its audit teams. The Secretary to the Board is in charge of maintaining its confidentiality, to the extent determined by the Board or the Audit Operations Committee.
60. Audit working papers such as schedules, analysis, memoranda, etc. prepared by the auditors in the course of the examination of the accounts and records which serve as the basis for the reports on the financial statements of the organizations shall be subject to disposal action after a period of four years after Assembly acceptance of the applicable financial statement and the Board’s audit report thereon, unless the Board or the Audit Operations Committee decides on a longer period.

61. Access to working papers by third-parties, such as investigative or internal audit bodies, is determined by the Board, its position on this matter and the Board’s own procedures.

OTHER MATTERS

62. Communications within the Board may be made by post, fax or electronic transmission.

63. In the event of the handover of an audit from one Board Member to another or to his or her successor, a formal record of the hand-over is prepared and kept on file by both the predecessor and successor auditors. It lists notably the documents handed over and the key information provided orally.

64. Cooperation with other assurance providers: In the identification of focus areas and in the determination of the extent of the Board’s audit procedures, due consideration should be given to the work of internal audit services. This should involve reviewing the works plans and reports of internal audit, as well as having detailed discussions with them, the objective being to avoid duplication of audit effort, as well as gaps in assurance providing activities. A key component involves ascertaining the extent to which the work of internal audit services can be used in keeping with the requirements of the International Standards on Auditing.

(b) RULES OF PROCEDURE OF THE AUDIT OPERATIONS COMMITTEE

Background and Mandate

1. The audit operations committee (AOC) was established to enable African Union (AU) Board of Auditors (BoA) to discharge its mandate in compliance with Article 78 of the AU Financial Rules and Regulations. The AoC shall comprise five directors of audit appointed by each member of the board and executive secretary to the board as an ex-officio member.

Sessions

2. A member unable to attend a meeting of the AOC may make his /her views on any matters to be considered known in writing or through his / her representative. A member’s representative at any given meeting shall not be lesser in rank than the director of audit and this representation shall be taken into consideration while establishing quorum. This designation shall be addressed in writing to the secretary. Such designation shall confer upon the designated official all the powers and duties of the member making the designation.

3. The AOC reaches agreement by consensus, or makes decisions by a majority of two at any meeting so long as they are more than two directors of external auditors. The Executive Secretary does not participate in the vote.

4. The AOC shall determine when or where it shall meet depending on the circumstances and / or matters to be addressed.

5. A Board member may designate in writing a representative ad interim, in exceptional cases, to the AOC , when the director of external audit is unavailable due to circumstances beyond his/her control. The representative ad interim enjoys the same powers as the director of external audit he or she represents. The members of the AOC individually, and the AOC collectively, shall plan their work in a manner that limits the need for such ad interim designations.

Independence and ethics

6. The AOC members are independent of the management of the African Union and its Funds and Programmes. They neither seek nor receive instructions from an individual member state. Each AOC member ensures that their auditors are perceived to be so independent, that they strive to be objective in dealing with the audit issues and that are free of personal interest and any external pressure, basing conclusions exclusively on audit evidence obtained in accordance with relevant standards.

7. The position of AOC members is incompatible with any office, duties, mandate or participation in any organ of the AU, its funds and programmes and other entities audited by the Board. AU employees do not participate in the decisions related to the contents of the audits, draft management letters and reports.

8. Each AOC member ascertains that the conduct of their auditors shall be in conformity with the INTOSAI Code of Ethics and principles, IFAC Code of Ethics and other generally accepted professional standards.

9. An AOC member shall disclose to the Board any close relationship with the African Union, its funds and programmes and other entities audited by him/her.

10. An AOC member should refrain from communicating their individual positions to third parties on such matters that are to be considered or are under consideration by the AOC or the Board.

11. An AOC member should not meet in an official capacity with Member State representatives and other third parties regarding the work of the Board or related thereto either directly or indirectly, without informing and obtaining the consent regarding any substantive position to be taken by the Board.

12. The deliberations and the minutes of the AOC are confidential.

Representation on the audit operations committee

13. The Audit Operations Committee (AOC) shall comprise the five Directors of Audit of each member of the Board and the Secretary to the Board as an ex officio member.

14. The chairperson of the AOC shall be designated by the chairperson of the Board of Auditors. The term of the chairperson of the AOC will be in line with that of the chairperson of the Board of Auditors.

15. If the Chairperson for any reason is temporarily unable to act, the member with the longest past service on the Board shall assume the functions of the Chairpersonship for the time the Chairperson is unable to act.

16. The Chairperson shall:
(a) Convene the session as provided in paragraph 1 and 2 above.
(b) Prepare the provisional agenda for the meetings, with the assistance of the Secretary to the Board, upon the advice of the AOC.
(c) Conduct the meetings of the session.
(d) Vote only as member.
(e) Issue such correspondence on behalf of the Board, as may be required.

Allocation of audits – procedures required

17. As per the rules and procedures of the Board, there shall be an annual decision, or whenever necessary, as to who will conduct each audit of the AU organs.

18. The following criteria should be considered in the decision of allocating audits to the respective board members:
a. geographical location of the audits
b. size and budget of the organ
c. capacity / available resources of the SAI
d. Language.

Conduct of audits

19. The AOC coordinates the work of the board to ensure that professional standards are maintained in the course of audits. This is achieved through reviews of audit plans, management letters and reports. It also reviews specific topics if need be and also reviews quality assurance.

20. Each Board Member shall ascertain that the auditors ascertain that the auditors have a thorough knowledge of, and experience in auditing and examining public sector operations in accordance with the International Standards on Auditing and the tasks entrusted to them , and a good working knowledge of a least one of the official working languages of the African Union. As such, each monitor shall hold the designations and qualifications required within his or her nation to carry out the task of public or private sector external auditing in line with the afore-mentioned standards

21. Each Member of the Board shall determine the scope, methods and resources required to conduct an audit, in accordance with the Board’s work plan, budget and the International Standards on Auditing. The objective should be to obtain the adequate assurance to discharge the Board’s mandate in the most efficient manner.

22. Though each director is free to determine the scope, methods and resources required to conduct his / her assigned audit in accordance with best auditing standards and guidelines, he / she shall ensure each audit has a permanent file and a temporary file. The permanent file shall among others include information / documents relating to the Organ/ entity that shall be used as a reference on a continuous basis during and after the audit. The temporary working file will contain information specific to the audit of the financial year. All this information will form part of the data base that will be kept by the executive secretary.

Reporting responsibilities

23. Each director assigned an audit shall, upon completion, circulate the draft management letter and draft audit report to the other members of the AOC for peer review. The absence of any written comments within a period of five working days shall imply approval of the draft. However, a director may in writing, request a delay or a meeting of the AOC to further examine the draft. In so doing, he / she shall ensure reasonable time and opportunity is accorded other directors within the five working day period.

24. The AOC will determine how best the unapproved or queried management letters shall be handled but in so doing will be guided by acceptable international audit standards.

25. Each draft report of the Board shall be examined in at least one formal session of the AOC.

26. The approved or revised drafts will be handed to the executive secretary for onward submission to relevant organs for comments / answers.

27. Based on the responses received, the final management and audit reports will be prepared for consideration by the Board.

28. The Board shall then provide the long form report and an audit opinion on the financial statements of each audit / AU organ

29. In addition to the management letters issued by the Directors of External Audit addressed to the African Union organs the Board shall issue and transmit, in accordance with relevant Financial Regulations.

30. The reports of the Board to the African Union shall be prepared in draft form by the AOC for the review and approval by the Board at its sessions prior to submission to the PRC subcommittee on audit matters. The reports of the Board to other bodies shall also be prepared in draft form by the AOC for the review and approval by the Board at its sessions.

31. Each Director of External Audit has the responsibility to ensure that draft management letters and draft reports submitted to the AOC are of a high quality and as far as possible of the same standard as when these audit outputs are, once adopted, transmitted to auditees.

32. Upon approval by the Board of the reports, the Executive Secretary shall distribute copies of the reports to the appropriate officials and committees or organs of the African Union.

33. Reports of the Board shall be prepared in English. They are translated in other official languages of the African Union in accordance with the African Union’s procedures.

34. Except with unanimous consent, the draft of a document to be signed by the Board shall not be considered until the members have had five working days study it and the round-robin approach could be used to clear it. After a report is signed by the Board members, no alterations may be made in the text, save to correct typographical or other obvious errors, without the consent of the Board.

35. The Chairperson of the Board and the Member who is the lead auditor of a particular AU organ audit are designated as such in the pages signed by the Board Members.

36. In the event that a member dissents from a decision or conclusion of the majority of the Board, he/she must:
a. Direct that the fact of his/her dissent and the reasons thereof be officially noted in the records of the Board; or
b. Set out in the report, with or without a statement or reasons, the fact that his/her opinion is to be regarded as qualified with the respect to the particular matter.

37. Regardless of the mode a Board member selects to record his/her dissent, the other members shall so conduct themselves that all views are fairly represented in the event of any questions arising with respect to the matter.
Quality assurance

38. Each member of the AOC is responsible to ensure that the audits assigned to them are in compliance with the applicable international standards and are performed in an economical, efficient, and effective manner; that to that effect professional and ethical standards are maintained in the audits through their in-house quality assurance programmes or systems.

39. The AOC members do so by adherence to (a) the International Standards on Auditing issued by the International Federation of Accountants and (b) the Auditing Standards of the International Organisation of Supreme Audit Institutions (INTOSAI).

40. To ensure that quality of the Board’s reports, they will be subject to a peer review by the AOC and the BoA, as provided for in these rules and procedures.

41. Upon completion of an audit, each AOC member shall ensure that each board member who is the lead auditor on a particular audit will be required to sign a certificate to confirm that the requirements of the ISAs have been complied with in relation to the achievement of the following objectives of the ISAs in conducting an audit of financial statements:

a. to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error
b. to express an opinion on whether the financial statements are prepared, in all material respects, in accordance with the applicable financial reporting framework
c. to report on the financial statements in accordance with the audit findings.

42. A failure to achieve an objective should properly documented by identification of the failure and details of its nature and cause in the certificate to be provided by each board member.
Records, databases and working papers

43. Though each director is free to determine the scope, methods and resources required to conduct his / her assigned audit in accordance with best auditing standards and guidelines, he / she shall ensure each audit has a permanent file and a temporary file. The permanent file shall among others include information / documents relating to the Organ/ entity that shall be used as a reference on a continuous basis during and after the audit. The temporary working file will contain information specific to the audit of the financial year. All this information will form part of the data base that will be kept by the executive secretary.

44. All records of the Board not contained in official documents of the African Union, such as minutes of the sessions of the Board, rules of procedure and the like, shall be part of the permanent, confidential records of the Board under the custodianship of its secretariat. General correspondence and memoranda formally issued by members of the Board and of the AOC shall be subject to disposal action after a period of four years. They shall not be communicated to outside parties unless the Board or the AOC agrees to do so.

45. Reports and audit working papers of whatever nature related thereto or to the activities to the activities of the Board are the property of the Board and shall be kept in such places and in such manner as the Board may direct. Until final action is taken by the appropriate authority with respect to the Board report, each person who is signed a report of the Board, or his/her successor shall have right of access to all papers and documents, including in an electronic form, relating thereto notwithstanding the fact that he/she may no longer be a member of the Board, or after a similar period with respect to reports submitted to other Governing Bodies or parties. If the working papers of a past Board member are requested by the serving member, upon request from the Executive Secretary, the past member will be obliged to provide access to these papers.

46. Management letters and reports, replies and relevant documents are maintained by the Board, for the use of its audit teams. The Executive Secretary is in charge of maintaining its confidentiality, to the extent determined by the Board’s secretariat on the Board Secretariat’s shared drive or the AOC.

47. Audit working papers such as schedules, analysis, memoranda, etc. prepared by the auditors in the course of the examination of the accounts and records which serve as the basis for the reports on the financial statements of the organizations shall be subject to disposal action after a period of four years after African Union acceptance of the applicable financial statements and the Board’s audit reports thereon or after a similar period with respect to reports submitted to other Bodies, unless the Board or the AOC decides on a longer period. The Lead Auditor will be the custodian of the Audit working papers and their disposal should, at minimum, be in accordance with the Board’s rules and procedures.

48. Access to working papers by third parties, is determined by the Board, and based on the Board’s own procedures.
Role of the executive secretary

49. The executive secretary, advises the AOC on administrative and financial practices and procedures of the AU.

50. The Executive Secretary is responsible for managing the work of the Secretariat of the Board.

51. Regarding audit matters, the Executive Secretary shall assist the Board and the AOC: in the development and implementation of audit policies and procedures; on administrative matters and financial practices and producers in the African Union; on past discussions and decisions of the Board and the AOC; and on the work of internal audit services.

52. The Executive Secretary prepares periodic information reports for the members of the Board on senior management changes, audit-related policy decisions, etc. taken by management and the legislative authorities. He/she maintains: close liaison with the secretaries of the relevant committees of the African Union to ascertain the extent of the work, if any being done on items or areas of interest to the Board; facilities the scheduling of meetings; and undertakes assignments within his/her area of responsibility, as requested by the Members of the Board and the AOC.

53. Regarding Board and AOC meetings, the Executive Secretary:

a. Plans and organizes the work of and assists in conducting the proceedings of the sessions, including preparation of the agenda and related documents for discussions; and draws the attention of the Chairperson and members on policy decisions, discussions etc., arising from the bodies that may be relevant to the work of the Board;
b. Assists in the transmission of queries to the African Union Offices, in the formal editing of the Board’s reports and memoranda, and in the distribution of the Board’s questions to and replies from the Offices of the African Union;
c. Communicates and coordinates the attendance of participants at Board meetings, as required
d. Does not participate in the Board‘s and the AOC’s decisions related to the contents of the draft management letters and reports.

54. The Executive Secretary takes appropriate measures to guarantee the full confidentiality of the Board’s and the AOC’s deliberations and minutes, which may be consulted only by their members and by auditors designated by them.

55. Regarding administrative responsibilities, the Executive Secretary, assisted by the staff of the Board’s secretariat:

a. Renders support to the support to the Chairperson of the Board and of the AOC;
b. Maintains the Board’s management letters and reports;
c. Ensures a comprehensive and current permanent record of permanent documentation relation to the activities of regular and special sessions of the Board.
d. Also, permanent files maintained by the Executive Secretary should include entity-wide founding resolutions under which the audit is conducted, specific resolutions governing committees, specific agreements between the Auditor and the entities and relevant financial regulations and rules. Lead auditors should add important correspondence between Auditors and clients, and conclusions and decisions adopted by Auditors on policy issues that may have a bearing on future audits. Other than this, documents that are currently available on the internet or AU’s intranet need not be saved in the permanent files. All documents provided by lead auditors should in paper and electronic format.
e. Monitors expenditures as they relate to the Board.

Other matters

56. Communications within the Board may be made by post, fax or electronic transmission.

57. In the event of the handover of audit assignments(s) from one Board Member to another or to his or her successor, a formal record of the hand –over is prepared and kept on file by both the predecessor and successor auditors. The handover note should layout the handover activities. Normally, this record should include the details of a training workshop at the incoming Member’s office to introduce the clients and their entities. There should be a full exposure to the clients that will be handed over both by the clients themselves and by the outgoing auditors. The handover record should also detail the introduction to specific executive heads and focal points amongst the clients and other specific handover activities between the outgoing and the incoming Board members. The record should also list the documents hander over and the key information provided orally.