Montserrat National Audit Office

Audit Services

Our primary role is to audit the accounts of Montserrat and public sector agencies and to report our opinion on the spending of public sector finances to the Legislative Assembly, Accounting Officers and taxpayers. A secondary role is to provide funding agents with information that would assure them that their monies were spent wisely and as intended. Our Audit Services include the following:

Financial Audits

The Public accounts of Montserrat are audited by the NAO on behalf of the Auditor-General in accordance with Section 103 of the Montserrat Constitution Order 2010.  These comprises the statement of accounts as specified in Section 41 of the Public Finance (Management and Accountability) Act. 

The Government of Montserrat’s current policy is to prepare the public accounts on the cash-basis of accounting (modified).  On this basis revenue is recognized when received rather than earned, and expenses are recognized when paid rather than when incurred. 

Section 45 of the Public Finance (Management and Accountability) Act empowers the Auditor-General to audit the accounts of any public organization and may authorize any person eligible to be appointed as an auditor. The accounts of many of these agencies are prepared on the accrual basis of accounting.

The Auditor-General is mandated to form an opinion as to whether all accounts are free from material misstatement. The Auditor-General is required to state whether the transactions conform to appropriate legislative authority. With respect to quasi-government agency accounts, the Auditor-General must state whether the accounts conform to international accounting standards.  Currently, the Auditor-General does not play a role in the audit of some agencies but we are working to address this issue.

Our audit of financial statements is carried out in accordance with the International Standards on Supreme Audit Institutions (ISSAIs).   The ISSAIs are the authoritative international standards on public sector auditing. The purpose of the ISSAIs is to:

  • ensure the quality of the audits conducted
  •  strengthen the credibility of the audit reports for users
  • enhance transparency of the audit process
  •   specify the auditor’s responsibility in relation to the other parties involved
  • define the different types of audit engagements and the related set of concepts that provides a common language for public sector auditing.

The full set of ISSAIs is based on a basic set of concepts and principles that defines public sector auditing and the different types of engagements supported by the ISSAIs.

Performance Audits (or Value-for-Money Audits)

Performance audits focus on how specific public sector projects, programmes and activities were implemented and are based on a planned and shared audit programme which may be adjusted due to unforeseen circumstances. This audit review the way the policies were effected and assess whether value-for-money was obtained. Performance audits do not question the merits of policy objectives. However, the means by which policy objectives are pursued, the implementation arrangements and controls, the costs incurred and the results achieved are all legitimate subjects for performance audits.

Performance audits assess the extent to which government ministries and departments and other public bodies have employed their resources; whether financial, human or material; in the performance of their functions and activities.  Performance audits principally provide independent information, advice and assurance concerning economy, efficiency and effectiveness in the major fields of revenue, expenditure and the management of resources, including the evaluation of service quality and the measurement of performance.  it also highlight appropriate means of securing improvements in financial control and value for money, and encourage, support and assist audited bodies in taking proper action where improvements are shown to be necessary and cost effective to enhance accountability.  These audits also cover governance and sustainability and are conducted following International Standards on Supreme Audit Institutions.

The Auditor-General reports both good practice and management deficiencies. The selection of topics for investigation is based on a systematic review of government spending with particular attention given to areas where the largest resources are involved, where performance is judged most at risk and where there are greater opportunities to enhance performance. All studies undertaken as part of the performance audit programme should have a lasting benefit to the audited body through improved service delivery, financial savings and/or improved governance.

Draft performance audit reports are discussed with the audited body concerned with a view to identify any fundamental differences of opinion on the main facts and conclusions to ensure accuracy and completeness as well as a balanced and fair presentation.  Reports do incorporate responses received to the main issues raised.

A summary of the main findings and recommendations are presented annually in the Auditor-General’s Report on the public accounts of Montserrat.

The NAO is always happy to hear about any areas or issues that we should consider in our performance audit work programme. Therefore, if there are issues or areas that you think we should look into, please Contact Us.

Compliance Audits

Compliance audits are conducted in accordance with accordance with the International Standards on Supreme Audit Institutions (ISSAIs) to enable the Auditor-General to arrive at a conclusion as to whether the activities of public sector entities are in accordance with the relevant laws, regulations and authorities that govern such entities.  Such audits involve an assessment of the degree to which the audited entity is accountable for its actions and exercises good public governance.  Specifically, this may involve auditing the extent to which the audited entity follows rules, laws and regulation, budgetary resolutions, policy, established codes, or agreed terms, such as the terms of contract or the terms of a funding agreement.

Information Technology Audits

We conduct information technology (IT) audits to ensure that the Government of Montserrat’s IT systems, operations and related control processes are effective and efficient to achieve their objectives.  The objectives of an IT audit include:

  •  Evaluate the reliability of data from IT systems that have an impact on the financial statements.
  • Evaluate the effectiveness of IT controls to ensure systems are functioning as intended.
  • Ascertain compliance with applicable laws, policies, and standards.
  • Assess whether the IT systems are aligned with the entity’s business objectives.

Environmental Audits

An environmental audit is an assessment of the condition of the environment, or the nature and extent of harm (or risk of harm) posed by an industrial process or activity, waste, substance or noise.  These audits are conducted in accordance with International Standards for Supreme Audit Institutions (ISSAIs) and with relevant environmental laws, standards and policies at a national level.  Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives.

Special Audits

Special Audits are focused on important issues or information received from our stakeholders or concerned citizens that we feel should be reviewed and reported to the Legislative Assembly.