When Corruption Becomes a Way of Life, and What to Do about It

Levels of corruption in Africa are symptomatic of the levels of moral decay that have engulfed African society. African society is drowning in a “have all, possess all” mentality that has become an endless orgy of spend and gain. Position and power have become keys to accessing resources meant for the general good and converting them for private good. We will be forgiven in concluding that the scrambles we see for power on our continent is no longer driven by a desire to serve but by waiting turns to loot. We have seen changes in ruling parties in various countries that have not resulted in a fall in levels of corruption.
This situation is compounded by the messaging by those who seek to fight corruption. The anti-corruption message is made very complicated by a multiplicity of terms and definitions—fraud, misappropriation, money laundering, illicit financial flows, and so on and so forth! These have left average citizens wondering what this is all about. Should we not just use as simple term like theft?
Another challenge is that the various development partners have continued to focus on strengthening oversight institutions in the accountability supply chain, instead of adopting a more all-encompassing approach. The supreme audit institutions’ anti-corruption agencies generally receive a lot of capacity building support, while the accountants and other professionals who actually “see things as they happen” are generally given the leftovers. Should we not be strengthening the whole supply chain?
The failure of political governance has made corruption endemic in Africa, and is a shared fundamental root cause. Most African governments come to power through corrupt and weak institutions, such as electoral commissions and the judiciary. It is too much to expect a government that comes to power through a corrupt electoral system to then turn round and fight corruption. Unfortunately, the international elections observer will, at the end of the day, tell the world “the elections were generally free and fair.” How can professionals no matter their determination be expected to be work with integrity under such a government?
Added to this is a media that has generally taken sides instead of being independent arbiters. The media generally has adopted the philosophy of “my friend’s corruption is alright, but that of my enemy is really bad.”
I believe the first point of call to ensuring integrity of public procurement is to have a mental transformation in the whole accountability supply chain. The private sector must accept that bribery is wrong, and that demanding bribes is wrong. Authorities must accept that using their position other than for the purpose for which it was intended is wrong. Surely, procurement professionals, accountants, bankers, lawyers, and people from all walks of life must know that taking part corrupt activities is wrong and abetting corruption is wrong. Society must be sensitized to abhor the corrupt and not celebrate them. The international community must openly reject all governments that fail to run elections in a free and fair manner and not allow diplomatic etiquette and trade interests to blind them.
As French economist and author Frederic Bastiat said, “When plunder becomes a way of life for a group of men in a society, over the course of time they create for themselves a legal system that authorizes it and a moral code that glorifies it.”
We need to simplify the message about corruption so that every citizen regardless of their level of education can understand it and its negative impact on their own lives.
IFAC actively supports the fight against corruption with many interventions, including the recent The Accountancy Profession—Playing a Positive Role in Tackling Corruption on the important role the profession plays in decreasing corruption. In addition, its International Framework: Good Governance in the Public Sector, developed with the Chartered Institute of Public Finance and Accountancy, promotes the development of robust public sector governance by establishing a benchmark for good governance. Accountability. Now. promotes high-quality financial accounting and reporting by governments to improve transparency and help strengthen public sector financial management and accountability. Together, IFAC and its partners challenge and support governments to improve the quality and transparency of their financial management.
In order to promote integrity and defeat corruption, all of society needs to work together. Citizens in African countries must hold those charged with the responsibility of managing resources, whether in the public or private sector, to account for the use of these resources. Internationally, no country should allow itself to be a haven for corrupt proceeds from Africa.
Corruption must be elevated to the level of criminality that it is—a crime against humanity. Let’s stop arguing against corruption, as there has been enough of that; let us take up a fight against corruption.

Exploring the Demand for Agreed-Upon Procedures Engagements and Other Services, and the Implications for the IAASB’s International Standards

Agreed-upon procedures (AUP) engagements are widely undertaken in many jurisdictions and frequently used by regulators, funding bodies, not-for-profit organizations, creditors, and other users.
In 2015, the International Auditing and Assurance Standards Board (IAASB) formed a Working Group to help the board understand AUP engagements use, national developments in relation to standards addressing AUP engagements, and broader market needs. This information will support any possible revisions of International Standard on Related Services (ISRS) 4400, Engagements to Perform Agreed-Upon Procedures Regarding Financial Information, which was developed over 20 years ago (for additional background, see our previous article on some of the issues the Working Group planned to explore).
  • highlights the key features of AUP engagements performed in accordance with ISRS 4400;
  • highlights the results of research and outreach by the Working Group; and
  • seeks stakeholder views on the issues to help inform the development of a standard-setting project proposal to revise ISRS 4400 and any other activities that may be necessary.
Specifically, the paper explores:
  • current demands for AUP engagements, implications for IAASB standard setting, and, in particular, the extent to which users and practitioners find existing requirements and guidance helpful in undertaking an AUP engagement and producing an AUP report that is valued by users; and
  • the demand for engagements that combine reasonable assurance engagements, limited assurance engagements, and non-assurance engagements, such as AUP engagements, to meet emerging needs.
The IAASB and the Working Group would like input from investors, preparers, those in governance roles, standard setters, practitioners, internal auditors, regulators, academics, and other stakeholders. This input will help determine what is needed to meet stakeholder’s needs, including standard setting and other possible actions.

The future of the audit industry: From masses of data, to meaning

 THE HISTORY of the audit profession there have been shifts in how audit is executed, because of the transformations in the environment in which companies operate. The audit industry is now facing significant changes in this financial crisis and as the purpose of audits change, we implement the learnings.
An auditor was once trusted to provide an accurate and detailed account of company data without the need or requirement to offer meaning or purpose to that data, but now auditors are increasingly in need of different skills to adapt to new user needs.
The key driver of this change has undoubtedly come from the users of audit data who are demanding an increasingly diverse array of data sources, those that do not traditionally fall within financial accounting. As a result, we are seeing more requests for data related to governance and corporate social responsibilities.
For example, data might be collected on the carbon footprint of company movements or information related to employees. This data is then open to users that would not traditionally have use for audit data, such as company employees and partners.


Technological change is also occurring at a rapid pace, ushering in the capability to capture and share data, on an unprecedented scale and almost instantaneously. This has resulted in an increasing focus on data, whether structured or unstructured, and whether generated internally or externally to the entity.
This new demand for data has led to the most critical aspect of this change to the audit industry. Auditors increasingly need to adapt to the changing needs of users and therefore provide meaningful interpretations of data. While many traditional investors would have pored through the financials to make long-term decisions, a newer breed of investors is more likely to invest in companies that offer a holistic view.
This view would be on how they treat their employees, manage their carbon footprint and anything that indicates the company is moral and upstanding. Auditing is no longer a transactional reporting exercise and the auditors have a key role in contributing to the credibility of the financial statements as well as obtaining assurance.
We auditors are now being called upon to provide a final step in the audit process – data illumination, requiring a two-fold development. Firstly, the auditors of the future will need to embrace technology and the ever expanding array of tools and techniques that advanced data analysis affords them. Secondly, they will need to be experts in data interpretation and synthesise meaning from the empirical evidence.
When I think of our newest RSM trainees, their experience will differ radically to my experience. Our newest RSM recruits are as comfortable discussing machine learning as they are forensic accounting, and we must cultivate these new skills if we are to continue to remain relevant.

Going further

Companies are increasingly driven and defined by their purpose, and we are seeing this at all levels of business activity both regionally and globally. Auditors must go further to make sure they are at the heart of these changes by continually engaging with all stakeholders and moving towards a new reality where they can lend credibility and confidence over a continuous stream of meaningful information.
Consumers of client information are no longer focused solely on the one time audit of the year. Now we must embrace the audit of the future

By Bob Dohrer who is global leader of quality and risk at RSM