Nepal Engineering College

MSc. Construction Management

Construction Management in Developing Countries
CM 2014

Presentation on
What are the challenges faced by a project auditor in developing countries? Suggest
practical ways to tackle them. Explain with specific examples.

Presented By:

Bhawesh Mandal
Roll No. 03/ CM III Sem.
Nepal Engineering College

Introduction

Auditors play a critical role in any Organization/Project

There are some challenges that we should understand that facing todays auditors in providing their
services to the client so as to establish a quality audit report

Typical Stages in Audit Process

Source:
http://sitefinitytemp.acb.org.uk/whatwesay/scienc
e/audit/what_is_audit.aspx

Challenges faced by a Project Auditor

Preparation Of Information & Documentation

Clients provide insufficient information that required by auditors

Information overload ( too much information and lost in between)

Challenges faced by a Project Auditor

Communication Between Auditors & Clients

Auditee/Staff at the clients office did not want to

cooperate with the auditors

The clients Auditee/staff are lack of understanding of the

objectives of auditing

Psychological (Fear and Phobia)

Intellectual (Knowledge and Skills of Auditee)
Source :http://www.free-managementebooks.com/faqpm/quality-07.htm

Challenges faced by a Project Auditor

Definitive Standards that are Hard To Understand

Technical words regarding to Clients business operation sometimes hard to understand

by auditors.

Delaying of auditors works

Less time can be spend on more critical aspects of the clients financial statements

Challenges faced by a Project Auditor

Avoiding Traps

Misleading Information ( Fake or Tailored evidence )

Understanding exact expectation of Key stakeholders

Challenges faced by a Project Auditor

Geographic Reach Of The Clients Office

Clients office are situated far from the auditors office (to reach for documents & other
information)

Auditors need to incur more costs not only for the transportation, but also for the whole project
(papers, printing, phone calls etc)

Bearing the risk of late payment by the clients

What does Audits Provide ?

Source: http://www.free-management-ebooks.com/faqpm/quality-07.htm

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How it can be Solved

Improve Audit Quality

By focusing on clients that value audits, audit firm can work on improving the audit quality

Auditors need to be willing to exercise more judgment in assessing areas of business risk

Auditors have to change their mindset not to only focus at cost-cutting

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How it can be Solved

Refocus On The Auditors Professional Responsibility

Because of financial challenges in auditing profession, auditors have recast their role as providing
value for the client neglecting their professional responsibility

Auditors need to flashback why they were granted a statutory mandate for performing audits for their
clients

Create a culture in their firms that recognizes this celebrate

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How it can be Solved

Improve Their Audit Planning & Strategy

Auditors need to have an efficient & effective audit strategy

Always make early preparation

Make sure they always obtain preliminary knowledge of the industry of the entity to be audited

Emphasized on payment method that can encourage their client to make payment soonest possible

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Conclusion

Give opportunity for others to think about the challenges faced by auditing profession
today

Auditors must find the appropriate ways to overcome those challenges (reduced the
risk bared & to improve the quality of their audit works)

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THE END
Any Comments/ Questions ?