Page 70 - Azerbaijan State University of Economics

Samuel Atsibha Gebreyesus: The Effect of Audit Legal Frameworks on Public

Expenditure Management …

Public-sector auditing is crucial because it offers information and independent and

objective judgments about the management and execution of government policies,
programs, or activities to those in charge of governance, the legislative and oversight
bodies, and the general public (INTOSAI, 2019).The purpose of auditing is to gather
the data required for performance reports and to provide independent assurance that
public sector activities are "fairly" reflected in accounting statements and reports
provided by management. The aim of statements is to provide information,
comments, and suggestions that will enable Parliament to examine government
operations, government review management operations, and management review
authority or department activities (Nosworthy, 1999).

In the public sector, auditing is an important component of the financial system. The
actual function of audit has evolved over time from simple detection-focused
processes to a performance assessment method that emphasizes advocacy and
prevention. The audit institutions are working to cover more pertinent financial
sector responsibilities in order to assure the responsibility of the budget recipients in
response to this changing situation (Matendera, 2013).Since the management of
public resources is an issue of trust, public-sector auditing is crucial for the public
administration. An organization or individual acting on behalf of the public is given
the duty of managing public resources in accordance with their intended uses. By
providing information and unbiased, independent assessments of violations of
established norms or good governance principles, public sector auditing builds the
intended users' confidence. Supreme audit institutions (SAIs) are a country's highest-
ranking public-sector auditing body. Their primary function is to assess whether
public funds are being used effectively, economically, and efficiently while adhering
to existing laws and regulations.

The effectiveness of controls can be confirmed, waste can be found, and
improvements to the performance of government organizations can all be made with
the help of well-functioning SAIs. They can aid in the fight against poverty and
national development by ensuring that money is wisely spent (OECD, 2010).The
term "accountability" refers to the organizational structure, strategy, processes, and
activities that help ensure that Supreme Audit Institutions (SAI) fulfill their legal
requirements. It also refers to the legal and reporting framework. Along with
overseeing the operations of its own office, the Office of the Auditor General (OAG)
is mandated to use its discretion to ensure accountability in other public
organizations (Nosworthy, 1999).

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