IAA: Lifting Liberia Out Of Systemic Corruption

By: Ad Kawah

However, other authors have expanded this conventional definition to include any form of dishonest or unethical conduct by a person entrusted with a position of authority, often to acquire personal benefit. Accordingly, corruption harms the economic development and social stability of nations, Liberia included, since it is rooted in the existence of privileges and incomplete market mechanisms. It is bad for development because it leads governments to intervene where they need not, thus undermining their ability to enact and implement policies in areas in which its intervention is clearly needed.

In economic terms, corruption is wasteful and undermines the nation’s economy. Scarce resources are taken away from the community, projects do not go ahead, national development is undermined. It also interferes with the development of a fair market and deters investment from within and outside the national economy. Socially, it corrodes trust between citizens and government officials and amongst the community as a whole. It is no naysaying the fact that corruption is a problem in every state, no matter how prosperous or stable.

One central facet of corruption in sub-Saharan Africa is administrative corruption which points to the misapplication of a law or a regulation to accommodate bribes or extract money. It has been substantially documented in the financial literature as one of the drivers inhibiting development and fueling poverty. It ranges from ‘petty bribes to government officials overlooking the violation of the law all the way to grand-scale corruption in the awarding of contracts for huge infrastructure projects. The consequence of this is that it creates distortions in government programs and retards investment, growth and poverty reduction.

While it can never be eliminated, it can be reduced and states achieve different results depending on the power of the state and its institutions. Hence, the establishment of the Internal Audit Agency of Liberia (IAA) through an Act of the Legislature in September 2013 as an instrument to ensure that internal audit standards and systems in keeping with best practices are established and maintained across government Ministries, Agencies and Commissions (MACs).

Since its establishment, the Integrity House (IAA) has managed effectively the activities of internal audit functions in various entities of government, thereby ensuring a systematic and disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes.

It is important to indicate that of the over one hundred Ministries, Agencies and Commissions (MACs) of the government of Liberia, the IAA covers about 65% of those MACs reflected in the national budget, with priority assigned to institutions with huge spending capacities. The goal is to simply help those spending entities do the right thing the right way.

So, rather than conducting post spending audits of public institutions, our auditors are seconded to those institutions to guide their daily spending activities to ensure that it’s done in consonance with existing public financial and procurement laws, as well as other relevant regulations and best practices.

While there may be limited empirical evidence available to the public overtime to show the IAA’s impact on corruption, anecdotal evidence suggests it has played a critical role in maintaining financial discipline and public sector accountability and transparency over the short while following its enactment as a semi-autonomous agency of government.

A classic instance is the payroll cleanup exercise of key government institutions embarked upon by the IAA about a year ago. As one of the entity’s top priorities for the fiscal period, the payroll verification is aimed at heightening fiscal probity in public governance through the identification and subsequent deletion of ghost names from the government’s wage bill.

At the moment, the IAA has concluded a significant number of those audits, including the Ministries of Health, Education and Internal Affairs, among others, and has disinterred an alarming sum of ghost names totaling approximately five thousand ghost employees that have overtime constrained the government of unwarranted payments.

This singular exercise has saved the government of Liberia millions in United States dollars which can be redeployed to other priority areas of the government. And I must quicken to intimate that the effectiveness of said exercise has compelled the government to replicate same at its foreign missions across the globe with the constitution of a National Payroll Cleanup Taskforce that is Co-chaired by the Internal Audit Agency of Liberia.

Inarguably, effective internal auditing is how well auditors detect or prevent actual errors within an organization and how best they propose remedial measures to safeguard the resources of the institution/organization.

Being cognizant of the foregoing, the IAA’s deployed auditors at various MACs have over the years brought under their control existing internal audit functions, and where there’s none, established one with the goal of:

– Advising and/or providing assurance that established control and reporting systems on the management of national resources are adequate;

– Advising and/or providing assurance that financial, managerial and operating information reported internally and externally is accurate;

– Advising and/or providing assurance that financial and operational activities of government are in compliance with laws, policies, plans, standards, and procedures that are applicable;

– Advising and/or providing assurance that risks are adequately managed in government;

– Implementing programs to uncover and prevent fraud; among other things.

Foundation on these efforts, the public service has made leaps in preventing wastes and abuse in the utilization of public resources over the recent period.

Corruption is seen as a primary impediment to growth, with serious consequences for the economies of developing countries. While the phenomenon of corruption is multifaceted and difficult to measure, and can be encountered in all sectors of an economy, we are inclined to conclude that strict adherence to and the implementation of regulations and laws as well as independence of the internal audit functions will help fight administrative corruption in Liberia.

Besides, borrowing the words of His Excellency Dr. George M. Weah, President of the Republic of Liberia, the most effective way to directly impact the poor and to narrow the gap between the rich and the poor is to make sure that public resources do not end up in the pockets of individuals. And that’s exactly what the Internal Audit Agency is bent on achieving for the good of the country, though with limited financial resources at its disposal.

Research has often times cited low salaries as a major proponent for petty corruption in the country, especially across all levels of government. Towards this effect, the IAA has managed to ensure that its personnel obtain fair earnings to match the quality of work they perform. As a consequence, the institution is now moving with unprecedented speed in the discharge of its audit functions, particularly so with the ongoing payroll audits of government MACs.

It is no gainsaying corruption has persisted throughout the governance system in Liberia, and the World Bank’s most recent worldwide governance indicators reflects that corruption still remains a major problem. However, in comparison to 2015, the overall bribery rate, for instance, has dropped from 69% to 53% in 2019 which signals a fair appreciation in the fight against corruption.

According to the 2019 Global Corruption Barometer data, half of Liberians reported that corruption has dropped over the year in comparison to the previous year where almost half of Liberians reported that the level of corruption had increased, particularly in the elections and justice sectors. Thankfully, there is an ongoing payroll audit of the justice/security sector in order to get rid of non-existent or ghost names from the government’s payroll and save it of millions being lost to ghost paddling.

While the IAA may not have authority over exerting political will to prosecute corruption, it continues to primarily busy itself with assessing institutional weaknesses of public institutions and providing remedial measures that would prevent the occurrence of corruption in the first place, referencing the deployment of internal auditors at various MACs.