Question No. 31

To ask the Tánaiste and Minister for Foreign Affairs and Trade if he is satisfied with the manner in which audits are undertaken on non Governmental organisations which are funded through Irish Aid; and if he will make a statement on the matter. – Anthony Lawlor.

For ORAL answer on Wednesday, 17th October, 2012. Ref No: 44645/12


The Government’s aid programme, which is managed by Irish Aid in the Department of Foreign Affairs and Trade, is sharply focused on the fight against global poverty and hunger. About a quarter of Ireland’s development assistance is channelled through development Non-Governmental Organisations (NGOs). In accordance with the objectives of the aid programme, this funding is provided to support the long term development work carried out by NGOs in developing countries as well as emergency humanitarian assistance and development education programmes.

I am satisfied that all funding to NGOs is allocated and monitored on the basis of the highest oversight standards at all stages of the funding cycle, including audit. Funding proposals submitted by NGOs are rigorously appraised against clear criteria by Irish Aid staff and, as appropriate, by external experts. The criteria include a proven organisational capacity for the effective use of funding and an assessment of management and oversight systems within partner organisations.

Audit is a fundamental component of good governance and the primary responsibility for complying with audit obligations rests with the NGOs funded by the Department. Contracts signed between the Department and NGO partners stipulate that annual audited accounts must be submitted to the Department as part of the annual reporting process. In the interests of transparency, Irish Aid also requires NGOs to publish their audited accounts on their websites.

Departmental procedures to ensure that funding is used for the intended purposes include regular field monitoring visits, annual narrative and financial reporting against agreed objectives and budgets, evaluations, audits and ongoing reviews of compliance.

In common with other Departments, expenditure under the two Votes of the Department of Foreign Affairs is audited by the Comptroller and Auditor General. In addition, the Department has its own Evaluation and Audit Unit, which is staffed by professionals and has responsibility for the internal audit function. Using a risk-based audit approach, it carries out and manages a range of evaluations, audits and Value for Money reviews, including reviews of NGO partners. Recent audits carried out have included those of the major Irish development NGOs, Concern, Goal and Trócaire.

In addition to these robust internal systems, the Department has an independent Audit Committee which reports to the Secretary General. It provides an independent appraisal of audit reports and of the Department’s audit and evaluation arrangements. The Committee meets regularly with the Secretary General and senior management of Irish Aid and annually with the Comptroller and Auditor General. It also publishes an annual report on its work.

The Government attaches the highest importance to ensuring effective audit and evaluation of all public expenditure. In my Department, regular reviews of the overall audit approach, audit work programmes and resource levels will continue to be undertaken by management to ensure that audit systems and coverage remain appropriate to the risks and challenges facing the Department of Foreign Affairs and Trade, including Irish Aid.