Audit Instinct

Recent realities across the world have shown that for countries and organisations to achieve sustainable development, auditing needs to be embraced. Even individuals that want to succeed in life must engage in regular self-auditing. This is because one of the fundamentals of (personal) financial success is financial discipline which finds practical expression in prudence and accountability.

There is now much corporate-governance consciousness globally, because of the strong desire to get out of the economic downturn plaguing the world. Auditing therefore becomes relevant because assessment of the level of compliance with corporate governance is determined through auditing. The desire to sustain the current corporate- best-practices campaign through auditing consciousness, especially in Nigeria, has inspired Obasesam Omini Etimita to write his new book entitled "Audit Instinct", with the subtitle "Excellence of Service Delivery".

Etimita, a Certified Public Accountant (CPA) is an associate member of the Institute of Certified Public Accountants of Nigeria (ICPAN). He has served in external and internal audit capacities. A 1996 graduate of Accountancy from the former Polytechnic, Calabar, Cross River State, Nigeria, Etimita believes in service to the people. He is the auditor, Obudu Ranch Hotel & Resort, Cross River State, Nigeria.

According to the author, this book brings to bear, our collective audit responsibility and timeline audit functions by leaders. He says the book also advocates an audit attitude for valuable public revenue and expenditure. Etimita stresses that it is a book on social engineering crusade as it preaches against the spirit of collusion in any given leadership structure. The professional accountant educates that the professional skills and techniques of the auditor of financial statements, transactions and accounts are broadly similar and transferable between the public and private sectors; as well as between profit-making and non-profit-making organisations.

He says in profit-making settings, the major objective of audit is to periodically, statutorily and independently validate the fairness of the profit figure or validate truth of the valuations in the balance sheet by the external auditor. In non-profit-making institutions such as government, audit is a seasonal concern of the legislature and the people, a mandate that public expenditure should be made only for duly-authorised purposes and conform to high standards of probity, expatiates the author.

According to Etimita, audit instinct is the inherent ability to effectively ask and timely verify budget outcome. He adds that it is also about objectively ascertaining the positive impact of the supplementary appropriation in order to be sure that everything is in order within the system.

As regards structure, this book is divided into eight chapters. Chapter one is based on the subject matter of the excellent instinct. Here, the author reveals that nature has made us captains of our instincts from birth. He says whether good or bad, the excellent of all is the audit instinct because it is more inclined to improving service delivery to the people. Generally, audit instinct can be defined as inherent inclination or innate behaviour of a person towards a sense of fairness without formal instructions or checks, submits Etimita. He adds that the existence of this audit virtue in any leadership structure is the sincerity to get things right. The author stresses that a good leadership structure that examines itself timely and purposefully is the audit goal and the financial security desired for adequate service delivery.

He suggests that every person within any given effective leadership structure must possess audit instinct. In Etimita's words, "The huge capital flight can be checkmated by our collective audit instincts. This I call 'self-auditing'. Therefore, it is possible for stakeholders to only invest legal proceeds of labour within our domestic structures and improve every sector of our economy."

He explains that the orthodox perception of the auditor is that of a watchdog. The author says in practice, the audit section is feared and expected not to bark or bite, but encouraged to become a mere rubber stamp. According to him, it is important for leaders to grant immunity and autonomy to auditors for improved results. Etimita expatiates that auditors are friends and important members of the system, who administer operational checks and ensure balances. He says the audit unit is often committed to observing, raising an alarm and reporting, but often nothing tangible is done by the leadership to change things. The author asserts that he believes that our collective audit instincts can make things right, otherwise we may not blame the audit.

Chapter two is based on the thematic focus of introduction to auditing. Here, Etimita says audit is defined as an evaluation of a person, organisation, system, process, enterprise, project or product. He adds that it is a similar concept applied in project management, quality management, energy conservation and good governance. The author stresses that auditing is performed to ascertain the validity and reliability of information, and provide an assessment of a system's internal controls. He says the audit goal is to express opinion on any person, organisation or community structure in question, based on work done on a test basis.

The author explains that audit at the moment seeks to provide only reasonable assurance that the statements are free from material errors as it was with banks and companies that eventually became distressed. He says a mere assurance or opinion will not help in the desired service delivery, hence the need for daily auditing attitude by all players in the system. In financial auditing, a set of financial statements are said to be true and fair when they are free from material misstatements, a concept influenced by both quantitative and qualitative factors, educates Etimita.

The professional accountant adds that recent auditing worldwide has begun to include other information about the system, such as security risk, environmental performance, information systems performance. Budget audit or cost audit, personnel audit, inventory audit and revenue audit are all forms of auditing that refer to a systematic and accurate verification of the transactions and records and checking of adherence to the objective of the system under assessment, explains Etimita.

According to him, people are no longer satisfied with hearing the billions and trillions of naira budgeted and spent by government and corporate organisations annually in Nigeria. Rather, they want to know the impact such huge spending will have on the development of the country and enhancement of their lives, says the author, adding that audit instincts can help in this regard.

Chapter three examines the concept of internal audit role. Etimita educates that given its vital advisory role, a timely independent report on operations will assist sensitive decision-making in leadership. He says this opinion affirms an earlier World Bank position on the internal audit that seeks to affiliate internal audit with the leader as a check unit to all first-line operations for an efficient service delivery.

Etimita explains that in Nigeria, the law that seeks to amongst other things, provide for the prudent management of the nation's resources and secure greater accountability and transparency in fiscal policy framework is the Fiscal Responsibility Act 2007. He says the strength of any law is when its enforcement is instinct-driven, and on this note, it becomes imperative to understand that the audit role is driven by fiscal responsibility.

The author says, "Internal auditing is the pivot of good corporate and public-sector governance. It provides timely objective assessment of the way resources are managed to achieve target results. The internal auditor helps the organisation and government achieve accountability, improve operations and instil confidence in the citizenry whose public trust government and private institutions hold."

In chapters four to seven, Etimita analytically X-rays concepts such as fiscal responsibility; value for money audit; due process and price intelligence; and audit working papers and reporting.

Chapter eight, the last chapter examines the subject matter of budget monitoring and evaluation. The author educates here that in practice, audit is hardly called into a budget preparation session. He adds that the reason may be old-fashioned because the document finally becomes public data and has impact. Etimita says budget is about monitoring and evaluation, and you can budget even in your home but it appears today, its essence is gradually depleting. The author discloses that it is the concern of the audit unit to improve budget implementation especially that it is a universal practice for individuals, companies and government as a medium of measurement of action and performance. Etimita adds that a budget for a trading company may be better appreciated if based on percentage benchmarks for an efficient cash flow management.

Stylistically, this book is outstanding. For instance, the language is very standard, pictorial and yet simple. This book is segmented into eight chapters that are well articulated. The intellectual creativity of the author, originality of the contents and depth of research are indeed commendable. What's more, another unique selling point of the book is the generous use of detailed and accurate illustrations to ensure easy understanding by readers. To fulfil literary academic requirement of source disclosure for credibility, bibliography section is included.

However, "Perfection" is one word that is not in the dictionary of Textual Criticism. Therefore, one area that needs to be improved upon is the outer front cover design which can be visually reinforced with the highlight tool and other necessary auditing tools to achieve effective non-verbal communication that easily is suggestive of the overall subject matter.

Generally, this text is a brilliant package. It is highly recommended to everybody because the author creatively articulates all-encompassing audit functions that guarantee all-round success in all aspects of our lives.

GOKE ILESANMI, Editor-in-Chief/CEO of http://www.gokeilesanmi.com and Managing Consultant/CEO of Gokmar Communication Consulting, is a Certified Public Speaker/Emcee, (Business) Communication Specialist, Motivational Speaker, Career Management Coach, Renowned Book Reviewer, Corporate Leadership Expert and Editorial Consultant.

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