Engineering Services_ Value For Money

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					                                                          GAMA
                                                            Engineering Services, Value For Money

                                                                                                             2007
                                                                                                             Gaborone, Botswana

                                                                                                        ACEB


                            TECHNICAL AND FINANCIAL AUDITING OF ENGINEERING PROJECTS
                                       S. Mambo, Council Member, ACEK, Nairobi, Kenya.
Abstract

This paper discusses the need for auditing engineering projects. It is to be presented to the 14th GAMA Conference to be held in
Gaborone, Botswana from 14 to 16 May 2007. The general theme shall be “Engineering Services, Value for Money” and the paper
falls under the sub-theme of Industry Regulation.

Why Audit? To independently verify that the Client is getting value for the money invested. Carrying out technical and financial
audit on ongoing and completed projects puts the project designer and those charged with implementation on the spot. On ongoing
projects, auditing would help identify early when the quality of work is wanting and also if the money is being well spent. It helps to
avoid very costly mistakes if the audit is left until the project is completed. However, carrying out an audit once the project is
completed is also useful to evaluate whether the final project cost represents good value for money and lessons learnt could be
applied to future projects.

Who should carry out the audit? A competent engineering consulting firm, supported by a firm of financial auditors who have
been appointed in a competitive and transparent manner.

How should audit be carried out? By taking an agreed sample and subjecting it to agreed tests, both technical and financial.

What are the audit deliverables? Technical and financial audit reports that clearly describe how the audit was carried out, tests
done, results obtained, conclusions drawn and recommendations based on the audit findings.

This paper shall discuss auditing methodology, data collection, analysis, evaluation and interpretation. The writer shall highlight
actual case studies of technical and financial auditing carried out in Kenya on road projects. Although the paper rightly falls under
the topic of Industry Regulation, the writer will emphasize the importance of procuring the services of consultants in a transparent
manner. There are inherent risks in auditing that shall be highlighted. These include accusations that can be levelled against a
consultant if he is auditing work carried out by the competition such as malice or a case of sour grapes if the report is negative.
Many a time, the auditees fail to give the expected cooperation since auditors are often viewed with suspicion. The audit exercise
only has value if reliable data is collected and the auditor analyses the data with an open mind without bias.

The paper will give the merits of auditing and the assurance the exercise gives the Client regarding whether or not value for money
is obtained on an investment. Recommendations on required actions whenever things are not going right will be given.