Presentation by Dr. Ahmed El Midaoui First President of the Audit Court of the Kingdom of Morocco (Cour des comptes)

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1 Presentation by Dr. Ahmed El Midaoui First President of the Audit Court of the Kingdom of Morocco (Cour des comptes) Auditing for Social Change 6 th Global Forum on Reinventing Government May 27, 2005 Seoul, Republic of Korea Translated into English by Mr. Ali Idouz. Mrs. Ichraf Amghouz Fifth Technical Committee in collaboration with the United Nations Department of Economic and Social Affairs (UNDESA), and in partnership with the Board of Audit and Inspection (BAI), Republic of Korea and the Korean Association for Public Administration (KAPA).

2 Workshop on Auditing for Social Change Outline Introduction 1- Challenges and Imperatives of Development in Morocco 2- Institutional Evolution and New Mandates of the Moroccan Audit Court (Cour des Comptes) 3- Social Auditing among Other Activities of the Audit Court: The case of auditing of projects for the promotion of social development within the framework of international cooperation (United Nations Development Programme (UNDP) and the United Nations Population Fund (UNFPA). 4- Compassing Social Changes with Audit and Perspectives of the Audit Court Conclusion 1

3 Introduction Government auditing in Morocco is characterized by a multiplicity of participants and the diversity of the modalities (public or private) and the objectives sought by public audit. In recent years, significant reforms have been introduced in this field. They included many areas such as financial control, the Expenditure Commitment Audit, the General Inspection of Finance, and the Jurisdictional Audit (Audit Courts). The aim of these reforms is to: Redefine and improve the modalities of public control. Make the participants aware of the process of the execution of public financial operations (commitment officers, auditors, public accountants) Establish a modern audit based on performance and results. Enhance autonomy of public management institutions. Reinforce transparency and ethics in public management. Improve investigation and risk management techniques. Taking into account the theme of the Fifth Committee of the Sixth Global Forum on Auditing for Social Change, the following presentation will highlight the following points: The evolution and reforms of social development in Morocco The organization and missions of the Audit Court and the Regional Audit Courts so as to allow them to ensure their role in controlling and auditing of socio-economic and public services projects (example of auditing of socio-economic projects carried and co-financed by the Kingdom of Morocco, UNDP and UNFPA The role the Audit Court is expected to play to fully ensure its mission in terms of auditing for the accompaniment of socio-economic changes as well as the implementation of a work strategy 1- Challenges and Imperatives of Moroccan Development Since the independence of Morocco, and especially since the 1990s, the public authorities have given much importance to programs and plans willing to develop the level of social welfare of the Moroccan population. Important evolutions are witnessed nowadays concerning social and political aspects of life and are noticed through political and associative activities, an increased involvement and participation of the population into the administration of public affairs and the apparent willingness to involve women in active life. The social development strategy followed by public authorities is based on: Reduction of social and regional inequalities targeted towards poor people especially in rural areas. Generalisation of access to schools. Fight against illiteracy. Promotion of government partnership programs, cooperation funds, and civil society aiming to fight against poverty. Support of projects creating jobs and extra revenues. Some important actions achieved in recent years confirm the public authorities determination to make of the social development a national priority. For example: the imputation of the privatization revenues to a fund to finance programs to fight against poverty. 2

4 the creation of the Mohamed V Foundation for Solidarity aiming along with other mobilized actors to fight against poverty. The foundation takes advantage of the special consulting status of the Economic and Social Council of the United Nations the creation of Hassan II Fund for Development with the objective to undertake projects creating multiple and diversified jobs and to promote the development of the rural world. the creation of a Social Development Agency whose tasks are to put in place development programs aiming to fight against poverty. the implementation of legislations related to the mandatory sickness insurance. reinforcement and development of NGOs working in the social sector. Nevertheless, social development and the improvements achieved remain, dependent on real possibilities of a pertaining development in socio-economic sector, mainly: boosting strong and sustainable economic growth reducing the unemployment rate to acceptable rates eradication of illiteracy and generalizing basic education facilitating easy access to basic social services and infrastructure; basically, access to health care, integration of rural population, electricity in rural areas; access to clean water, and housing in rural areas. The imperatives of these developments and the constant evolution of social and economic statistics impose an urgent call for reforms by public authorities to act on administration reform in order to make it a modern and productive tool, which is capable of adapting and assuring progress, governance based on transparency, and good management and public funds. In fact, since 1993, public authorities have become aware of the increase of accumulated deficits in the social sphere and the need to improve and rationalize public management. A social development strategy has been implemented and was assigned three priorities: growth of employment opportunities and population revenues increase access to basic social services (clear water, electricity, sanitation, education, literacy, housing) among impoverished population reinforcing assistance and social security programs to the most vulnerable social groups. This social orientation was, in fact, sustained in the social and economic development plan which marked the adhesion of Morocco to the objectives of the World Summit for Social Development held in Copenhagen in 1995 and very recently on the occasion of the adoption and application of the Millennium Development Goals (MDGs). The aim consists of matching each of the eight main objectives held, by targeted figures which have to be reached in a deadline of 25 years, between 1990 as a starting year and 2015 ending year. The Moroccan approach was formalized in the national report related to the objectives of the Millennium for Development in December This new approach in the social field necessitates a strong mobilisation of all the national actors in order to achieve a real boost and combined efforts to improve management methods and guidelines of economic and social policies of development reinforced by good governance on the national, sectorial, regional, and local levels. 3

5 The Cour des comptes, as a financial jurisdiction and given its roles and missions, has among its main concerns the promotion of human development and intends to contribute to achieve this goal in the most efficient way. 2- Institutional Evolution and New Mandates of the Audit Court: After this brief overview on the social issue in Morocco, it would be suitable to present the context and foundations of the new missions of the Court. Aware of its responsibilities, the Court is making a great effort to develop its organizational structure and methods of working in a new environment characterized by a dynamic evolution towards initiating new reforms to set up a sustainable development nationwide. Evolution of the Institutional Framework of the Audit Court: In 1979, the establishment of the Audit Court under law N 12/79 In 1996, the elevation of the Audit Court to the Status of a constitutional institution In 2002, the promulgation of law N 62/99 (the Public Finance Jurisdiction Code). This law marks an important stage in the Audit Court s development, as it expressly lays down the mandates, composition, and work methods of the Audit Court and the regional Audit Courts. Major Innovations of the Public Finance Jurisdiction Code an expanded and redefined function the preparation of the annual report and its submission by the Senior President to His Majesty the King the adoption of comprehensive audit methods the priority given to management audit the establishment of the Regional Audit Courts and the reinforcement of their mandates the assistance provided to parliament and government. The Code expressly provided new forms of assistance: With regard to Parliament, the Audit Court may reply to questions which may be put to it by the chairmen of the two Houses of Parliament (the House of representatives and the House of Counsellors) in connection with the examination of the Budget Act Implementation Report and the General Statement of compliance which accompany the Settlement Act when it is submitted by the government to one of the Houses of Parliament. With regard to government, the Audit Court may, at the request of the Prime Minister, include in its programmes the function of assessing public policies and evaluating the management of the institutions audited by it. 4

6 3- Social Auditing among Other Activities of the Court: The case of auditing projects for the promotion of social development within the framework of international cooperation (United Nations Development Programme (UNDP) and the United Nations Population Fund (UNFPA). This chapter highlights the status of social auditing through social projects co-funded by the government of Morocco and the United Nations Population Fund and the United Nations Development Programme. It also shows its importance through the Audit Court s organizational structure and work methods. At the Organizational Level: The Court includes five Chambers composed of magistrates and civil servants, three of those Chambers exercise the same duties and responsibilities. They only difference between them is the nature of their scope of intervention (social, economic, financial etc.) Two new Chambers were set up in April 2004: the Appeal Chamber and the Budgetary and financial Discipline Chamber. The workload of the Court has been distributed between the above-mentioned three Chambers as follows: First Chamber: Ministries and sovereignty government departments. Second Chamber: the economic and financial sector Third Chamber: the Social and cultural sector. On the other hand, the management audit programme for this year 2005 includes the following areas: Social security and retirement Supplying the rural zones with drinking water (PAGER) Supplying the rural zones with electricity Health services management Social housing Tourism Technical assistance projects The Promotion of Social Development Projects Auditing through International Cooperation: The Moroccan SAI carries out the audit of technical assistance projects cofunded by the government of Morocco and some international institutions such as the United Nations Development Programme (UNDP) and the United Nations Population Fund (UNFPA). The main projects audited by the Court during the last two years are as follows: Social projects co-funded by the Moroccan government and the UNDP concerning: Environment protection, natural resources management and the promotion of renewable energy resources and substitute fuels programmes. Mor 97/2004 Anti-desertification and anti-dryness programmes. Mor/02/ 2003 Governance and institutional building programme Mor/97/2001 Strategic planning support programme 5

7 Social projects co-funded by the government of Morocco and the UNAPF include Health and family planning programme, and Gender and development programme. The Impact and Follow-up of Audit Recommendations: The deficiencies detected by the auditors during the audit of these projects are contained in a provisional report submitted to the project director. After that, a final report shall be prepared which includes the responses of the audited entity and, if necessary, the recommendations issued to improve the projects management. This report shall be sent to the UNDP or UNAPF and to the government departments concerned. In case some breaches and violations which come under the remit of the Audit Court relating to the Budgetary and Financial Discipline or to the facto management occur, a report is to be prepared accompanied with the necessary supporting documents. This report is also submitted to the Attorney-General of the ing who may refer the case to common law Courts through the Ministry of Justice, if some penal violations are committed. 4- Compassing Social Changes with Audit and The Perspectives of The Audit Court: The scope of audit has been extended to include not only regularity audit, but to give priority also to the principles of economy, effectiveness, and efficiency of public management. New public management has put more emphasis on the promotion of performance and value for money standards with which public funds have been spent. Auditing and the accountability it implies have led to the adoption of international new approaches and methods to ensure a more efficient and economic management that takes into consideration the social dimensions of sustainable development. Nowadays, the quality of public services and the social and economic achievements are two important indicators to measure the degree of development of a nation. The Audit Court adheres to the global goals agreed upon by the Moroccan Government and the two international organizations (UNDP and UNAPF) to ensure a sustainable development and issue recommendations and suggestions to improve the management methods of the provided public services. To achieve that, the Audit Court has adopted a new strategy based on the fulfilment of its tacks and duties through its support of development measures particularly in the social sector. The Strategic Orientation of the Audit Court The major challenges mentioned above enhances the Moroccan SAI to share its goals, methods, and strategies with its partners and the entities subject to its audit in order to attain the same results by the Audit Court and the Regional Audit Courts by setting up good governance at the national and regional levels. Based upon a pragmatic and realistic vision, the Audit Court has adopted new strategic orientations to reinforce professionalism and the implementation of public audit s international standards. These strategic orientations put an emphasis on: the growing importance of management audit the establishment of an orderly and well balanced programming the set up of operational Regional Audit Courts the reinforcement of professional capacities of members and officials of the Court the adoption of international standards on regularity and management audits the introduction of new information and communication technologies 6

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