World Bank Group: Important Steps Taken on Internal Control but Additional Assessments Should Be Made
GAO-03-366
Published: Jun 16, 2003. Publicly Released: Jun 16, 2003.
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Highlights
The Congress passed Public Law 106-429 because it was concerned about the sufficiency of external audits of the financial operations of the World Bank Group, a set of multilateral development banks. This law provides that GAO report on the sufficiency of such audits of each Bank Group entity. GAO addressed (1) the extent that the external auditor was providing assurance on internal control over financial reporting, operations, and compliance with key provisions of bank charters and policies in conjunction with financial statement audits and (2) the role the Bank Group's audit committee plays in providing oversight of external financial statement audits and internal control.
Recommendations
Recommendations for Executive Action
Agency Affected | Recommendation | Status |
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Department of the Treasury | The Secretary of the Treasury should instruct the U.S. Executive Director of the Bank Group to take the lead in working with the other executive directors in developing a policy requiring the Bank Group entities to enhance the audit function and reporting of their financial operations. This would entail conducting a comprehensive evaluation of internal controls over operations and compliance to determine whether such controls are in place and are functioning properly to prevent misuse of funds and to ensure compliance with key provisions of bank charters and policies. |
Treasury's Under Secretary for International Affairs informed the USED in March 2004, of the United States policy goal set in P.L. 108-199, which includes establishing a plan and schedule for conducting regular, independent audits of management controls.
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Department of the Treasury | The Secretary of the Treasury should instruct the U.S. Executive Director of the Bank Group to take the lead in working with the other executive directors in developing a policy requiring the Bank Group entities to enhance the audit function and reporting of their financial operations. This would entail reporting annually to the board of executive directors through the audit committee on the progress made. This evaluation could be carried out in any of several ways, including through the internal audit function; by the external auditor, in conjunction with the financial statement audit; by another entity within the Bank Group; or by an external party, such as a consultant. |
Treasury's Under Secretary for International Affairs informed the USED on March 2004, of the United States policy goal set in P.L. 108-199, which includes establishing a plan and schedule for conducting regular, independent audits of management controls.
|
Department of the Treasury | The Secretary of the Treasury should instruct the U.S. Executive Director of the Bank Group to take the lead in working with the other executive directors in developing a policy requiring the Bank Group entities to enhance the audit function and reporting of their financial operations. These Bank Group entities should also provide the results of the assessment to member countries annually. |
Treasury's Under Secretary for International Affairs informed the USED in March 2004, of the United States policy goal set in P.L. 108-199, which includes establishing a plan and schedule for conducting regular, independent audits of management controls and making reports describing the scope and findings of such audits available to the public.
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Topics
Bank managementInternal controlsAudit oversightFinancial statement auditsFinancial statementsFinancial reportingGovernment auditing standardsDevelopment assistanceAccounting standardsPerformance monitoring