COVID‑19 is a novel coronavirus, so no one has immunity. In the short term, audit offices are also not immune to its effects—in many jurisdictions, offices are closed with auditors working at home.
But what about the longer term? Are my performance audit plans immune to COVID‑19? Here are five questions to consider:
- Should some planned audits be delayed? Many government organizations are involved in the COVID‑19 response. Beyond the health emergency itself, government organizations are launching new economic and social programs to deal with societal impacts. Upcoming and recently started performance audits may no longer be feasible because of this shift in priorities. Even if the audited program is not itself involved, other parts of the department may be responding and consuming the time of senior officials. Pressing forward with an audit during a crisis may make us look “tone deaf”.
- Should some planned audits be advanced? On the other hand, it may be an excellent time to begin audits that were not scheduled until later. Some government programs are largely moth-balled, for example if they involve face-to-face program delivery, operations in other countries or non-essential back office support. Even if the program is operating, staff may be working from home, with time available because some of their duties are no longer possible. Program management may welcome the choice of having the audit conducted during this interlude, rather than when operations return to their normal busy time.
- Have risks significantly changed? The COVID‑19 crisis is creating new risks and increasing pre-existing ones. In many jurisdictions, major new programs are being launched in a matter of days, with high inherent risk of control weaknesses. Even where residual risks have been low, controls may be left unattended as staff focus on responding to the crisis. And the crisis is shedding new light on existing risks – in many places, emergency response was not well planned, important data was unavailable, on-line resources were inadequate, and action by different levels of government was uncoordinated (suggesting the need for collaborative audits covering different levels of government).
- Is this a good time to engage stakeholders? Audit selection is an ideal opportunity for stakeholder engagement. Stakeholders – interest groups, other audit and watchdog agencies, experts and members of the legislative oversight committee – can provide unique insights into risks, suggest specific audit ideas or comment on those already identified. And engaging them raises awareness of the performance audit practice. With stakeholders unable to do some of their work from home, this may be an ideal time to consult them.
- Should I invest available staff time in improving the audit selection process? Home-bound auditors may also have available time that could be used in the audit selection process. Some performance auditors (and financial auditors too) may not have been involved in past audit selection, and may have audit ideas and risk insights to share. This may also be a great time to improve the “knowledge of the business” in areas not recently audited. Or available staff might help improve the audit office’s data analytics to support audit selection, for example by analyzing recent performance audits to identify areas of under-coverage, or whole-of-government risks. Lastly, this might be an excellent time to review and improve the existing audit selection process. The Canadian Audit and Accountability Foundation has published a discussion paper on audit selection that includes many examples of good practices used in Canada and elsewhere. The Foundation has also facilitated audit design workshops in several audit offices in Canada and internationally.