Performance Audit: Managing for Results to Value for Re$ources

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Performance AuditManaging for Results to
Value for Reources

• ICGFM Miami Conference Training 2008
• May 22, 2008
• .
• Jean-Baptiste Sawadogo
• Strategic Results-Based Management Consultant
• Leader One Inc
• Tel. [phone] E-mail JeanBSaw_at_aol.com
  
• The one people call when they really want
  results

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Performance AuditThe Wave of the Future

• Performance Audit is about audit on Value for
  Reources (VfR) it is a paradigm shift in
  Public Financial Management
• Early forms of performance reviews (Assessments,
  Evaluations and Audits) have put the spotlights
  on Spending vs. Results, leading to Managing
  for Results
• In turn, Managing for Results is now driving
  the rising wave of Performance Audits
• The leadership of Public Finance functions is
  key in Managing for Results to get Value for
  Reources

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Global Realities and Milestones

• Finance is finite AND Do more with less!
• Starting with the global recession of the early
  1990s
• Finance is not everything
• CIDAs Strategic Review and Renewal Exercise
  (1990)
• Results-Based Management (RBM) at CIDA (1993)
• Office of the Auditor General of Canada Report
  (19931995)
• Aid Effectiveness Principles adopted by DAC-OECD
  (1996)
• Assessing Aid a World Bank report (1998)
• Results for Canadians - a Government-wide RBM
  Policy (2000)
• Many OEDC countries have adopted a results-focus
  ( - 2000)
• The Millennium Declaration on the MDGs at the UN
  (2000)
• Managing for Development Results WB and OECD
  (2002)
• Paris Declaration on Aid Effectiveness
  DAC-OECD-led process (2005)
• Beyond Finance, there is a global consensus on
  the focus on results

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A New Global ImperativeManaging for Results

• Demands on governments and their agencies to
  deliver and to be accountable for results
• Demands on international organizations to focus
  on results (UN Multilaterals NGOs etc.)
• Demands on private firms to perform better both
  financially and socially (ethics responsibility)
• Demand for innovative results-focused management
  approaches
• Increasing demand for a new type of audit gt
  Performance Audit

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What is Performance Audit?

• Performance Audit is a systematic, purposeful,
  organized and objective examination of government
  activities designed to promote accountable
  government includes the examination of
  economy, efficiency, cost effectiveness and
  environmental effects of government activities
  ...
• A focus on performance covers both the benefits
  accomplished for citizens and due process and
  fairness in the delivery of services.
• (Excerpts adapted from the Performance Audit
  Manual,
• Office of the Auditor General of Canada - June
  2004 pages 13 and 17)

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What is Managing for Results?

• A deliberate, systematic, rigorous pursuit of
  results through the practice of Management it is
  a way of thinking a way of doing business
• Designing/planning implementing monitoring
  reporting evaluating auditing managing risks
  communicating
• Linking of Reources with Results committed
  to
• Two brands of results-focused Management
• Original Results-Based Management (RBM)1 -
  Inputs vs. Results (Results are outputs,
  outcomes, and impacts)
• Consensus Managing for Development Results
  (MfDR)2
• 1Original brand Canadian International
  Development Agency (CIDA) 1993
• 2Subsequent consensus brand
  DAC-OECD-led consultative process 2002

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A Seven-Point Overviewof Managing for Results

• Misconceptions
• Principles
• Words
• Tools
• Crosscutting Issues
• Functional Stakeholders
• Rewards

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1. Top Misconceptions

• Managing for Results is Monitoring
  Evaluation
• Attribution of Results is impossible
• The impact? Dont bother!

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2. Top Principles

• Partnership/Participation
• Transparency
• Broad application (even to Audits)

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3. Top Words

• Result an expected or actual achievement (i.e.
  an output, an outcome or an impact)
• Activity it is NOT a Result it IS the
  doing that supports the achievement of a result
• Indicator it is ONLY a measure to assess
  progress towards or achievement of a result

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4. Top Tools

• The Logical Framework Analysis (LFA) or a simpler
  Logic Model at the very least
• The Performance Measurement Framework (PMF)
• The Implementation Plan (including Work Breakdown
  Structure/activities budgets reporting risk
  management operations strategy communication
  strategy)

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5. Top Crosscutting Issues

• Gender Equality Mainstreaming responding to the
  specific issues for girls, boys, women and men
• Sustainable Environment Mainstreaming not only
  dealing with regulatory compliance, but also,
  with developmental sustainability
• Knowledge Management Sharing - addresses a 4th
  RBM principle Learning by Doing

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6. Top Functional Stakeholders

• Managerial functions - corporate and line
• Performance review functions (Monitoring,
  Reporting and Evaluation)
• Financial functions (Budgeting, Accounting
  Control Procurement Audit)

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7. Top Rewards

• Guaranteed Value for Reources right results
  at the right efficiency (effectiveness and cost
  optimization for results vs. a potentially costly
  strict lowest cost approach)
• Capacity to demonstrate relevance and communicate
  performance - Results vs. Reources (both the
  good news and the bad news)
• Rewards recognition access to more funding
  competitive funding is an emerging practice
  (excellent illustration by GAVIs DQA1)
• 1GAVI Alliances Data Quality Audits

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Summary and Conclusion

• Performance Audit is the wave of the future in
  Public Financial Management
• Managing for Results is the road to Value for
  Reources (VfR) in Public Service
• Performance review functions (ME) have been
  promoting MfR Financial functions need to catch
  up with MfR for a greater VfR
• Audit professionals acumen and leadership,
  especially with Performance Audit, is crucial
  in keeping Public Financial Managements focus on
  getting Results with public Reources.

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So, Exercise Your Results-Focused Leadership!

• For additional Information
• Office of the Auditor General of Canada
  Performance Audit Methodology http//www.oag-bvg.
  gc.ca/internet/English/oag-bvg_e_859.html
• OECD-World Bank Managing for Development
  Results www.mfdr.org
• Leader One Inc e-mail to JeanBSaw_at_aol.com