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Improving audits to increase the effectiveness of development funding

Donors and development actors rely quite heavily on audit reports, despite their high cost and the disruption they cause. Yet it is questionable whether this reliance is justified as most development sector audits over-emphasise the testing of purchase vouchers, supplier quotations and payment receipts, and do not necessarily provide sufficient decision-making information for donors. Governments and development partners can assure the success of development funding by improving the terms of reference for audits. These should promote controls to detect fraud and corruption that are aligned with ensuring quality outputs for development outcomes.

8 February 2020
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Improving audits to increase the effectiveness of development funding

Main points

  • A strong relationship between funder, implementer, and auditor is vital in ensuring the effective use of development funding.
  • Organisations using donor funds should be judged on proof of outputs or short-term outcomes rather than less reliable accounting entries.
  • An audit which concentrates on a single aspect of a development programme can harm other aspects and subsequently fail to recognise whether it is achieving its intended aims.
  • The success of development programmes relies on implementers continuously improving their systems to identify and manage risks, and a programme’s design, monitoring, and evaluation should understand those risks that could prevent its desired goals.
  • Better alignment between implementers and sponsors on project goals, the risks, and the definition of quality delivers a more satisfactory audit, which becomes a valuable oversight tool for the sponsor.

Cite this publication

McMinn Mitchell, P.; (2020) Improving audits to increase the effectiveness of development funding. Bergen: U4 Anti-Corruption Resource Centre, Chr. Michelsen Institute (U4 Brief 2020:1)

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About the author

Philip McMinn Mitchell

Philip is a Fellow of the Institute of Chartered Accountants in England and Wales. He is based near Geneva where he works with international development organisations on risk mitigation and donor audit management. He lived in East Africa for over 15 years, where he worked with local NGOs which provided primary healthcare and HIV-related services to their communities within national and donor funded programmes.


All views in this text are the author(s)’, and may differ from the U4 partner agencies’ policies.

This work is licenced under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International licence (CC BY-NC-ND 4.0)