PROJECT DESCRIPTION
BIBLIOGRAPHIC BACKGROUND
The existence of the following works related to the investigation has been determined:
1) Liñán Salinas Elcida Herlinda (2002), in “Control actions for the development of a comprehensive audit in a Public University”; establishes that the control actions are the basic tools to determine the evidence that the comprehensive audit needs, to specify its process.
2) Accounts Figueroa, Ana María (2003), in “Application of control mechanisms in the sale of hospital services”; establishes that the control mechanisms are constituted by the control actions carried out by a Hospital to control the sale of health services that it provides to the insured and uninsured community. Said actions work as a thermometer to establish costs, sale values, sale prices and profit margin.
3) León Flores, Gilberto & Zevallos Cardich, José María (2001), in “The administrative process of internal control in municipal management”; seeks to promote a modern and effective administrative control instrument that implies a change in the functional structure of the responsible body so that it functions comprehensively, effectively and efficiently and that ensures, as far as possible, permanent control of all the procedures of the municipal body in order to that each action be executed within the financial, administrative and operational fields, exercising strict and permanent vigilance of compliance with the previous, concurrent and subsequent control measures.
4) Bendezú Iriarte, Juan Héctor (2001), in “Management Audit in the modern company”, develops the different concepts, methodologies and control tools to carry out the management audit. It presents a management audit model which breaks with the traditional “finding - proposal” dichotomy of classical management audit. In effect, it proposes a more complete cycle in order to achieve the adaptation of the audit dynamics to the technical and cultural needs of modern organizations.
5) Hernández Celis, Domingo (2003), in “Effective control of the management of a Cooperative Company of Multiple Services”, goes so far as to demonstrate that effective control constitutes an instrument that helps to optimize the comprehensive management of companies multiple service cooperatives. In this thesis, a study of the cooperative control system is carried out considering the establishment of normative documents, strategic control points, corrective actions, nature of the control, importance of prior, concurrent and subsequent control, special techniques necessary to do an effective control work., work programs, control procedures, control techniques and other elements that facilitate the optimization of institutional management.
6) Hernández Celis, Domingo (2004), in “Control of Non-Governmental Development Organizations-NGDOs-for the effectiveness of International Technical Cooperation”; establishes the control mechanisms that allow evaluating the efficiency, effectiveness and economy of the programming and management of the International Technical Cooperation (CTI), which are executed by the Non-Governmental Development Organizations (NGDOs), in favor of the Peruvian population. It also establishes that the prior, simultaneous and subsequent verification control actions of the International Technical Cooperation, managed by the Non-Governmental Development Organizations, constitute the pillars for achieving efficiency, effectiveness and economy of resources, which correspond to all Peruvians.-
7) Miraval Contreras, Lizet Gladys (2005), in “Internal Control Deficiencies in the Budget Execution Process”; conducts a diagnosis of internal control activities in the budget execution process applied to a Ministry of Health hospital, determining a set of deficiencies; Then it proposes the corresponding solutions so that the budget execution process can meet the goals and objectives in the provision of health services required by the community.
PROBLEM STATEMENT
DESCRIPTION OF THE PROBLEMATIC REALITY
The project refers to the control actions practiced at SUNASS, during the 2000, 2001 and 2002 fiscal years, as part of planned and unplanned control actions within the framework of the Internal Audit, Financial, Budgetary Audit and Special Examinations carried out in the regulatory entity.
SUNASS is a Decentralized Public Institution with functional, economic, technical, financial and administrative autonomy; attached to the Presidency of the Council of Ministers - PCM, as established in the Framework Law of Regulatory Bodies for Private Investment in Public Services, promulgated on 19.12.1992 as part of the regulation of the Sanitation Sector.
In accordance with SUNASS regulations, this entity has the following powers:
• It guarantees the user that sanitation services are provided in the best quality conditions.
• Establishes the general conditions of service provision.
• Issues complementary regulations on the provision of sanitation services. This includes regulations on the organization of the Sanitation Service Provider Entities (EPS), service quality, rate regulation, instruments for dealing with user complaints and other aspects related to the provision of sanitation services.
• It supervises the fulfillment of the norms of benefit of the service and of fixation of tariffs, watching that the service that the EPS provide is given in conditions of quality, and if applicable, applies the pertinent sanctions.
The SUNASS PEI stresses that it is the mission of this Agency to ensure that sanitation services are offered within established quality and price ranges, and that users are satisfied with the quality of the service they receive and aware of the value of the services of sanitation, as well as their rights and duties.
In accordance with the MAGU that contains the rules on the process of financial audit, management and special examinations; SUNASS is subject to regulations that govern the national public sector and is liable to control actions by the Comptroller General of the Republic or the Audit Companies that it designates; as well as by the Institutional Control Body (OCI) of the entity.
The SUNASS, is located in the Magdalena del Mar District, Province and Department of Lima, to date is responsible for regulating and supervising the rates applied by the 45 Service Providers Companies - EPS nationwide, among which are find SEDAPAL, which is one of the largest EPS in Peru; as well as, to resolve in second and last administrative instance the claims presented by the users of the sanitation services.
The Diagnosis carried out at SUNASS reports that the Financial and Budgetary Audits for fiscal years 2000, 2001 and 2002, were carried out by Audit Companies designated by the Office of the Comptroller General of the Republic and the Special Examinations were carried out by the Institutional Control Body.
With regard to the Financial and Budgetary Audits, it is revealed that they have only had an impact on the Financial and Budgetary Statements of the entity, with the purpose of expressing its opinion regarding their reasonableness; on the other hand, no control actions have been applied to evaluate the activities of the line bodies that constitute the entity's raison d'être and about which there is concern on the part of the Sanitation Sector and especially of the national community that uses the services.
Likewise, the Special Exams practiced included the traditional critical areas, related to the processes of contracting and acquiring goods and services and disbursements in favor of suppliers, having avoided the application of control actions in the framework of the Special Examinations to the line bodies of the entity, on which revolves the objectives, mission and vision of the regulatory entity.
MAIN PROBLEM:
How to specify the control actions in the Sanitation Services Regulatory Body to identify different events based on which institutional effectiveness will be facilitated?
SECONDARY PROBLEMS:
1. How to use the diagnosis to facilitate the effectiveness of the SUNASS management process?
2. How to establish a synergy between control actions and decision-making, so that they are facilitators of the institutional effectiveness of SUNASS?
DELIMITATION OF THE INVESTIGATION
SPACE DELIMITATION
The research will include the diagnosis of control actions and their effect on the institutional management of SUNASS.
This includes prior, simultaneous and subsequent verification precautionary actions carried out as part of the financial audit and special examinations carried out in each of the headquarters and its dependencies at the national level.
TEMPORARY DELIMITATION
The investigation will include the diagnosis of the control actions applied in SUNASS the fiscal years 2010 to the present.
SOCIAL DELIMITATION
The investigation will take into account the directors, officers and workers of SUNASS; as well as to the users of the sanitation services that the entity supervises and controls.
THEORETICAL FRAMEWORK
NATIONAL SUPERINTENDENCY OF SANITATION SERVICES:
The National Superintendency of Sanitation Services - SUNASS, is a Decentralized Public Institution with functional, economic, technical, financial and administrative autonomy; attached to the Presidency of the Council of Ministers - PCM, as established in the Framework Law of Regulatory Bodies for Private Investment in Public Services.
SUNASS is the regulatory body for sanitation services, guaranteeing that its decisions are the most accurate according to current regulations and according to criteria that demonstrate fairness based on controlled source information. Likewise, it must ensure that its actions are procedural in a way that facilitates the jurisdictional function that is its responsibility.
BASIC POSTULATES OF THE GOVERNMENT AUDIT:
The control actions that are applied in SUNASS are carried out within the framework of the government audit.
The postulates are basic hypotheses, coherent premises, logical principles and requirements that contribute to the development of auditing standards and support the opinions of the auditors in their reports, especially in cases where there are no specific applicable standards.
The Government Audit Manual refers to Mautz and Sharif, who say that a postulate is an assumption that can be verified and is essential for the development of the theory. They indicate five general characteristics that the postulates must meet: i) Essential, for the development of any intellectual discipline; ii) Assumptions, which do not by themselves reach direct verification; iii) A basis for inference; iv) Fundamental for the construction of any theoretical structure; and, v) Susceptible to be challenged in light of the subsequent advance of knowledge.
The basic postulates that will be applied in the development of this work are the following:
1. Legal authority to exercise government audit activities;
2. Applicability of government auditing standards;
3. Relative importance;
4. Government audit is aimed at improving future operations, rather than criticizing only the past;
5. Fair judgment of the auditors;
6. The exercise of government auditing imposes professional obligations on auditors;
7. Access to all kinds of public information;
8. Application of materiality in the government audit;
9. Improvement of audit methods and techniques;
10. Existence of appropriate internal controls;
11. Government operations and contracts are free from irregularities and collusion;
12. Responsibility (obligation to account) and government audit.
BASIC CRITERIA OF GOVERNMENT AUDIT:
At the governmental level, the audit criteria are issued by the General Comptroller of the Republic, in order to guide the management of the bodies that make up the National Control System. The basic criteria are general lines of action that ensure uniformity in the tasks performed by the auditors. Such guidelines promote the fulfillment of activities in an effective, efficient and economic way; and, they provide a reasonable assurance that the programmed objectives and goals are being achieved.
It is equally important to have a set of auditing standards, procedures and practices that guide the action and allow for the quality control of the audit and to measure the achievements. The basic criteria applicable to government auditing are:
1. Efficiency in handling the government audit;
2. Continuous training;
3. Functional conduct of the government auditor;
4. Scope of the audit;
5. Understanding and knowledge of the entity to be audited;
6. Understanding of the internal control structure of the entity to be audited;
7. Use of specialists in government auditing;
8. Detection of irregularities or illegal acts;
9. Recognition of notable achievements of the entity;
10. Timely communication of the audit results;
11. Comments from the officials of the audited entity;
12. Presentation of the draft report to the audited entity;
13. Quality of the audit reports;
14. Constructive tone in the audit;
15. Organization of audit reports;
16. Quality control reviews in Internal Audits;
17. Transparency of audit reports;
18. Access of people to supporting documents of the audit
THE INTERNAL CONTROL SYSTEM AND THE GOVERNMENT AUDIT:
According to the MAGU, for several decades modern management has implemented new ways to improve controls in companies. This is important to keep in mind, since internal control has a direct link with the course that the company must maintain towards achieving its objectives and goals. Internal control cannot exist if previously there are no objectives, goals and performance indicators. If the results to be achieved are not known, it is impossible to define the measures necessary to achieve them and assess their degree of compliance on a regular basis; as well as minimizing the occurrence of surprises in the course of operations.
According to the Dictionary of the Spanish Language of the Royal Academy, it considers that the 6-term control has two meanings: i) Inspection, inspection, intervention; and, ii) dominance, command, preponderance.
Control is an action, insofar as it is tangible and, consequently, the effect it produces can be measured.
In auditing, the term internal control encompasses the organization, policies, and procedures adopted by the directors and managers of the entities to manage operations and promote compliance with the responsibilities assigned to achieve the desired results.
No internal control structure, no matter how optimal it may be, can guarantee, by itself, efficient management and complete, accurate and reliable financial records and information, nor can it be free from errors, irregularities or fraud, especially when those tasks are incumbent on trust charges. Therefore, maintaining an internal control structure that eliminates any risk may be an impossible objective, and it is likely that it will be more costly than the benefits considered to be obtained from its implementation.
From the first definition of internal control established by the American Institute of Certified Public Accountants - AICPA in 1949 and until its modification by SAS No. 55 in 1988, this concept did not undergo major changes until 1992, when the National Commission on Financial Information Fraudulent in the United States, known as the Treadway Commission, established Ida in 1985 as one of the multiple legislative acts and actions that stemmed from the investigations into the Watergate case, issues the document called Framework Internal Control Integrated), which further develops the modern approach to internal control in the document known as the COSO Report (Committee of Sponsoring Organizations of the Treadway Commission).
The COSO Report provides a common structure approach to understand internal control, which can help any entity achieve achievements in its performance and in its economy, prevent loss of resources, ensure the preparation of reliable financial reports, as well as compliance with laws and regulations, both in private and public entities. The concept of internal control has five components: i) control environment; ii) risk assessment; iii) control activities; iv) information and communication; and, v) supervision.
These components are integrated into the management process and operate at different levels of effectiveness and efficiency, which allow managers to rank at the level of control system evaluators, while managers who are the true executives are position themselves as the owners of the internal control system, in order to strengthen it and direct efforts towards the fulfillment of its objectives.
In the public sphere, after having discussed the issue of internal control in successive international conferences, in 1971 the concept of internal control was defined. This occurs at the International Seminar on Government Auditing held in Austria in 1971, under the patronage of the United Nations and INTOSAI (acronym in English for the International Organization of Supreme Audit Institutions), defining internal control as follows: Organizational plan and the set of coordinated measures and methods, adopted within a public entity to safeguard its resources, verify the accuracy and degree of reliability of its accounting data, promote efficiency in operations and stimulate the observation of policy.
CONTROL
Control is the punctual and continuous process that aims to check whether the programming and management has been carried out in accordance with what was planned and achieved the programmed objectives.
Control is punctual, when it is eventually applied to certain areas, functions, activities or people.
Control is continuous when applied permanently. Includes prior, concurrent and subsequent control.
EFFECTIVE CONTROL
Control is effective when it does not hinder administrative and operational functions and also when the suggestions and recommendations of the bodies responsible for it are taken into account and when the necessary corrective measures are applied to optimize business management.
Andrade, maintains the following theory: Effective control consists of evaluating a set of financial, economic and social proposals, with the purpose of determining if the goals, objectives, policies, strategies, budgets, programs and investment projects emanating from management are They are complying as planned.
Effective control is the verification process aimed at determining whether or not the plans are being followed, whether or not progress is being made towards achieving the proposed objectives and the action process, if necessary, to correct any deviation.
More concisely, E. Gironella Mac Graw, quoted by the Informative Caballero Bustamante, calls "Internal control to the organization plan and the set of methods and procedures that serve to help management in the best performance of its functions."
CONTROL STANDARDS
They are the control mechanisms that are part of a Control System.
The Control Standards are the Manuals of: Policies, Risks, Organization and Functions and Procedures; Regulations of: Internal Control, Internal Audit, External Audit, Organization and Functions; Institutional Strategic Plan; Budget; Investment Programs, Financing Programs and other documents.
Other control standards are the source documents, main and auxiliary books, financial statements and budget statements, the reports of the Boards of Directors, management reports, audit reports, etc.
AUDIT
According to the MAGU, the Audit is the professional, objective, independent, systematic, constructive and selective examination of evidence, carried out after the management of public resources, in order to determine the reasonableness of the financial and budgetary information, the degree compliance with objectives and goals, as well as with respect to the acquisition, protection and use of resources and, if these were managed with rationality, efficiency, economy and transparency, in compliance with legal regulations.
The audit activity is dedicated to obtaining evidence, since it provides a rational basis for the formulation of judgments or opinions. The term evidence includes documents, photographs, analysis of events carried out by the auditor, and in general, all material used to determine if the audit criteria are met. In general terms, audit evidence can be classified into four types: physical, testimonial, documentary and analytical.
For a better understanding of the auditing practice, it has been considered to divide it into three phases: Planning, Execution and Report.
Audit Planning encompasses the development of a comprehensive strategy for its conduct, as well as establishing an appropriate focus on the nature, timing and scope of the audit procedures to be applied.
Regarding the execution of the audit, it should be indicated that if, when preparing the corresponding planning memorandum, the auditor decides to trust the controls, we generally carry out tests of controls and, as the case may be, perform tests, consisting of substantive tests, analytical procedures or a combination of both. To conclude that the scope of the audit was sufficient and the financial statements or management are free from material error, quantitative or qualitative factors should be considered in evaluating test results and errors detected in conducting the audit: Part of Procedure involves reviewing the financial statements, books, source documents, to determine if they are consistent with the information obtained and were prepared and presented appropriately.
Before concluding the audit, the subsequent events are reviewed, the Management Representation Letter is obtained, the Memorandum of Conclusions is prepared and the Audit Findings are communicated to the entity. Finally, the Audit Report is prepared containing the Opinion on the Financial or Management Statements, as the case may be, Conclusions, Observations and Recommendations of Internal Financial Control resulting from the audit.
DIAGNOSIS OF PRACTICED ACTIONS:
According to Andrade (1999), it is the analysis of the control actions applied. You should understand a look at the current situation and the evolution that the entity has had in the year 2000, 2001 and 2002, based on a Diagnostic Matrix that reflects the: situation found, actions taken, expected results and results obtained.
For the elaboration of the Diagnostic Matrix, the analysis of the general and specific environment must be considered. In the general environment, it will include the analysis of the factors that correspond to it: legal, technological, social and any other factor that is considered pertinent. The specific environment will include the definition of users / beneficiaries, main collaborators and other public or private entities that provide similar services.
According to Koontz & O´Donnell (1990), a practical way of identifying the problem as well as evaluating the favorable and adverse conditions it is going through is SWOT ANALYSIS, which allows identifying and evaluating the favorable or adverse factors of the environment and internal environment. SWOT analysis allows analyzing the changes in the external environment in terms of Threats and Opportunities as well as the internal environment in terms of Strengths and Weaknesses.
Once the identification of weaknesses and strengths has been achieved, together with the opportunities and threats presented by the environment, the combined analysis of both, expressed in a Matrix, can provide an adequate panorama within which to determine the strategic objectives. That array must contain:
SWOT MATRIX
Opportunities are situations or factors that are beyond our control, whose peculiarity is that they are feasible to be exploited if certain conditions are met.
Threats are those external factors that are beyond our control and that could harm and / or limit the development of the organization. Threats are events that occur in the environment that represent risks.
Strengths are the human and material capacities available to adapt and take full advantage of the advantages offered by the social environment and face possible threats with greater possibilities of success.
The weaknesses are the limitations or deficiencies of skills, knowledge, information and technology that are suffered and prevent the use of opportunities offered by the social environment and that do not allow it to defend itself from threats.
CONTROL ACTIONS
According to Contreras (1995) Control actions are activities that are carried out as part of the evaluation of the Internal Control System, special examinations, financial and budgetary audit, etc.
Según el Informe COSO, las acciones de control comprenden las políticas y los procedimientos que tienden a asegurar que se cumplen las directrices de una evaluación. También tienden a asegurar que se toman las medidas necesarias para afrontar los riesgos que ponen en peligro la consecución de los objetivos de una sección, división. Departamento, gerencia o entidad en general. Las acciones de control se llevan a cabo en cualquier parte de la organización, en todos sus niveles y en todas sus funciones y comprenden una serie de actividades tan diferente como pueden ser evaluación de aprobaciones y autorizaciones, verificaciones, conciliaciones, arqueos, tomas de inventario, análisis de resultados de las operaciones, salvaguarda de activos y segregación de funciones, etc.
Control actions are the rules and procedures that aim to ensure that the guidelines that the decision-making body has established in order to control risks are followed.
Control actions can be divided into three categories, depending on the type of objective of the entity: operations, reliability of financial information and compliance with applicable legislation.
Although some types of control are related to only one specific area, they often affect various areas. Depending on the circumstances, a certain control action can help achieve the entity's objectives that fall into various categories. In this way, operational controls can also contribute to the reliability of financial information, controls over the reliability of financial information can contribute to compliance with applicable legislation, and so on.
According to the MAGU, through the application of control actions, the auditor gathers the evidence to report on the financial statements, management and operations of the entity, the management's assertions related to the effectiveness of internal controls and compliance with the legal and regulatory provisions. Control actions can be implemented through Tests of controls that are performed to obtain control security, by confirming that the controls have effectively operated during the period under review. Also through Compliance control tests that are carried out to obtain evidence and on compliance with the relevant legal and regulatory provisions. Likewise, substantive tests are performed to obtain audit evidence,Regarding whether the statements in the financial statements lack significant errors. Within them, substantive detail tests and substantive analytical procedures are applied.
The application of control actions in the development of the financial audit allows the auditor to obtain evidence on whether the financial statements lack significant errors, for which it considers the applicable laws and regulations. In the event that situations denoting the existence of illegal acts become evident, in accordance with the government audit standards issued by the Office of the Comptroller General of the Republic, the auditor must issue a special report, without prejudice to continuing with the examination.
During the execution of the audit, the auditor, as part of the control actions, carries out the following activities: i) Considers the nature and scope of the tests; ii) Design effective and efficient tests; iii) Perform the tests; iv) Identify errors or irregularities of relative importance and weaknesses in the internal control structure (audit findings); v) Evaluate the results.
AUDIT PROCEDURES AND TECHNIQUES:
According to the MAGU, coinciding with the opinion of Elorreaga (2002), during the execution phase, the audit team works to obtain evidence and carry out tests on it, apply audit procedures and techniques, develop findings, observations, conclusions and recommendations. Audit procedures are specific operations that are applied in an audit and include techniques and practices deemed necessary, depending on the circumstances. Auditing techniques are practical methods of investigation and testing that the auditor uses to obtain necessary evidence to support her opinion. Auditing practices constitute the specific tasks performed by the auditor as part of the examination.
The most used audit techniques to gather evidence are:
AUDIT EVIDENCE AND METHODS FOR OBTAINING INFORMATION:
Cashin, Neuwirth and Levy (1998) coincide with the concepts of the MAGU, when they indicate that the set of proven, sufficient, competent and pertinent facts that support the auditor's conclusions is called evidence. It is the specific information obtained during the audit work through observations, inspection, interviews and examination of the records. The audit activity is dedicated to obtaining evidence, since it provides a rational basis for the formulation of judgments or opinions. The term evidence includes documents, photographs, analysis of events carried out by the auditor and in general all material used to determine if the audit criteria are met. In general terms, audit evidence can be classified into four types: physical evidence, testimonial evidence,documentary evidence and analytical evidence.
DEVELOPMENT OF AUDIT FINDINGS:
The Dictionary of the Spanish Language published by the Royal Spanish Academy considers that the term discovery has three meanings: a) found thing; b) action and effect of finding; and, c) casual encounter of other people's furniture that is not treasure or quotas; typical of changing the law. Although the first concept could be associated with auditing, the second meaning of action and finding effect, defines more precisely the nature of the finding that refers to the effect of detecting something important; however, this term has many meanings and conveys a different one to different people. Generally, the term finding is used in a critical sense and refers to weaknesses in the internal control system detected by the auditor. Thus,It covers facts and other information obtained by the auditor that deserve to be communicated to the officials of the audited entity and to other interested persons.
According to Panez (1986), coinciding with the MAGU, the result of the comparison that is made between a criterion and the current situation found during the examination of an area, activity or operation is called an audit finding. It is all information that in the auditor's opinion allows him to identify important facts or circumstances that affect the management of resources in the entity, program or project under examination that deserve to be communicated in the report. Its elements are: condition, criteria, cause and effect. The requirements that an audit finding must meet are: relative importance that merits being communicated, based on facts and precise evidence that appear in the work papers, objective, convincing for a person who has not participated in the audit.
According to Holmes (1999), the auditor should be trained in the techniques to develop findings objectively and realistically. When carrying out your work, you must consider the following factors: i) Conditions at the time the event occurs; ii) Nature, complexity and financial magnitude of the operations examined; iii) Critical analysis of each important finding; iv) Integrity of the audit work; v) legal authority; and, vi) Differences of opinion.
EFFICIENCY:
It is the virtue and power to achieve a certain effect. It is the normative measure of the use of institutional resources. It is the relationship between costs and benefits focused on finding the best way to do or execute tasks (methods), so that resources (people, machinery, raw materials) are used in the most rational way possible.
Efficiency seeks to use the most adequate and properly planned and organized means, methods and procedures to ensure optimal use of available resources.
Efficiency is not concerned with the ends but with the means.
Efficiency can be measured by the amount of resources used to develop a product or provide a service. Efficiency increases as costs and resources used decrease. It is related to the use of resources to obtain a good or objective.
Rationality implies adapting the means used to the ends and objectives to be achieved, this means efficiency, which leads to the conclusion that an organization will be rational if the most efficient means are chosen to achieve the desired objectives, taking into account that the objectives considered are organizational and not individual. Rationality is achieved through rules and regulations that govern the behavior of the components in search of efficiency. The concept of rationality is fundamental to understand the behavior of organizations, since that is the primary requirement in the administrative activities of an organization, which leads it to produce a wide variety of behaviors to achieve the objectives.
EFFECTIVENESS:
According to Tuesta (2000), it is the ability to satisfy a social need by supplying products (goods or services).
Efficacy is synonymous with effectiveness and refers to the degree to which a government entity, program or project achieves its objectives and goals or other benefits that were intended to be achieved, provided for in legislation or set by another authority.
According to COSO, internal control systems operate at different levels of efficiency. In the same way, a given system can work differently at different times.
When a control system meets the standard below, it can be considered an "effective" system.
Internal control can be considered effective if: i) The entity's operational objectives are being achieved; ii) They have adequate information to the point of achieving the entity's operational objectives; iii) If the entity's financial, economic and equity information is reliably prepared; and, iv) If the applicable laws and regulations are complied with.
While control is a process, its effectiveness is a state or condition of the process at a given moment, the same that when exceeding established standards facilitates the effectiveness of institutional management.
The determination of whether a control system is "effective" or not and its influence on effectiveness, constitutes a subjective stance that results from the analysis of whether the five components are present and operating effectively: control environment, risk assessment, control, information and communication and supervision activities.
Its effective operation provides a reasonable degree of assurance that one or more of the stated goal categories will be met.
Therefore, these components are also criteria for determining whether internal control is effective.
“Effective management is related to the fulfillment of the actions, policies, goals, objectives, mission and vision of the company; as established by modern business management ”.
MANAGEMENT PROCESS:
Interpreting Chiavenato (2000), we can say that business management is a process of applying principles and functions to achieve objectives. According to the author, the various functions of those responsible for business management make up the administrative process; for example, planning, organization, direction and control considered separately constitute the administrative functions; when taken as a whole to achieve objectives, they make up the administrative process or business management process.
The management process implies that events and relationships are dynamic, constantly evolving and changing, and continuous.
The management process cannot be immutable, static; on the contrary it is mobile, it has no beginning, no end, no fixed sequence of events; in addition the elements of the management process act among themselves; each of them affects the others.
Chiavenato says that an administrative function is not an isolated entity, but an integral part of a larger set made up of various functions that are related to each other, as well as to the whole set. The whole thus considered is greater than the sum of the parts.
Companies do not improvise, almost everything must be planned.
Planning is the first administrative function because it serves as the basis for the other functions. This function determines in advance which are the objectives that must be met and what must be done to achieve them; therefore, it is a theoretical model to act in the future. Planning begins by setting goals and detailing the plans necessary to achieve them in the best possible way. Planning and determining objectives is to select in advance the best way to achieve them. Planning determines where you want to go, what should be done, how, when and in what order.
Planning has several ways of dealing with uncertainty: on the one hand, it can lead to a point where decisions are postponed or not made for fear of the situation; This attitude is called "analysis paralysis." On the other hand, managers can worry almost exclusively about immediate problems and make inappropriate decisions for the future of the organization; This attitude is called "extinction by instinct." These dilemmas force the manager to continually weigh the relative costs and benefits associated with varying degrees of planning, while planning or facing change. As we live in a time of change and discontinuity, companies must adapt and if possible, anticipate them. Every company must be able to make changes to survive.If the person in charge of business management makes appropriate changes, he will be able to progress and grow.
Organization as a function of business management refers to the act of organizing, integrating and structuring the resources and bodies involved in its administration; establish relationships between them and assign the powers of each. Organization is a basic activity of the administration that serves to group and structure all resources (human and non-human), in order to achieve predetermined objectives.
Management, which follows planning and organization, constitutes the third function of business management. With the planning defined and the organization established, it only remains to make things go. The role of management is to put the company to work and energize it. Management is related to action - how to start - and it has a lot to do with people: it is directly linked to the action on the company's human resources.
The management function is directly related to the way to achieve the objectives through the people who make up the business organization. Management is the function of business management that refers to the interpersonal relationships of managers at all levels of the organization and their respective subordinates. For planning and organization to be effective, they must be energized and complemented by the guidance that must be given to people through communication, leadership skills and adequate motivation. Management must communicate, lead and motivate. It is one of the most complex functions because it involves guiding, helping execution, communicating, leading,motivate and comply with all the processes that serve managers to influence their subordinates by seeking to behave in accordance with expectations to achieve company objectives.
EFFECTIVE MANAGEMENT:
“Effective management is the process undertaken by one or more people to coordinate the work activities of other people in order to achieve high quality results that one person could not achieve on their own. Competitiveness comes into play in this framework, which is defined as the extent to which a company, under free market conditions, is capable of producing goods and services that pass the market test, while maintaining or expanding real income from your employees and partners. Also in this framework, quality is conceived, which is the totality of the features and characteristics of a product or service that refer to its capacity to satisfy expressed or implicit needs ”.
"Effective management is the set of actions that allow to obtain the maximum performance from the activities carried out by the company".
Effective management, which means that the members of a company work together with greater productivity, that they enjoy their work, that they develop their skills and abilities and that they are good representatives of the company, presents a great challenge for its managers.
DECISION MAKING:
According to Robbins (2004), decision making is traditionally described as choosing between alternatives. Decision making is a process.
The decision-making process begins with the existence of a problem or more specifically, a discrepancy between an existing situation and another desired one; then it continues with the identification of a decision criterion, assignment of values to the criterion; development of alternatives; analysis of alternatives; selection of an alternative; implementation of the alternative and evaluation of decision effectiveness.
Administrative decision-making is supposed to be rational, by this we mean that administrators choose consistent options and increase value within specific constraints.
A perfectly rational decision maker must be completely objective and logical. You will need to define a problem carefully and have a clear and specific goal. Furthermore, the steps in the decision-making process must be consistently directed towards the selection of alternatives that maximize these goals.
JUSTIFICATION AND IMPORTANCE OF WORK
Given the results of the diagnosis applied to the control actions carried out in SUNASS, the need to add internal and external control actions is justified to evaluate the line bodies that represent the entity's raison d'être, in such a way that they allow knowing the observations, conclusions and recommendations on the functions performed by the bodies responsible for the main line of business or activity of the entity. The observations will allow feedback to be given to the plans, programs, organization, direction, coordination and control, which will result in improving the quality of the entity's services, all of this taking place in the community.
This research work will capture the professional experience in various public entities (INABIF - PATPAL (PROMUDEH) - PROMPERU - MUNICIPALIDAD DE JESÚS MARÍA - MUNICIPALIDAD DE LINCE, National Institute of Family Welfare - INABIF - MIMDES (formerly PROMUDEH), etc., carrying carry out control actions, as part of Comprehensive Audits, Management Audits and Special Examinations.
In the framework of the evaluation of the management of a public entity, it is essential to plan and apply control actions in the permanent and continuous process in order to determine, measure and / or check if the SUNASS resources have been executed in accordance with the planned and achieved the programmed objectives; if the necessary corrective measures were not taken.
This vital function of verification and review of plans and compliance with laws and regulations, must be carried out through subsequent control actions, so that it allows, efficiently and in accordance with reality, a transparent evaluation for the benefit of the entity and the community to which serves.
The control actions applied to the line bodies will ensure that the current policies and procedures are adapted to the needs of modern institutional management. It will also enable the fidelity and timeliness of the reports submitted, so that the most accurate decisions can be made. It also ensures adequate monitoring to verify if the management control policies are obeyed.
The application of the control actions will be carried out without interfering or suspending the exercise of the functions and activities of the entity's dependencies, consequently it will guide its function to analyze the fulfillment of goals, objectives, mission and vision; as well as, inform or recommend the establishment of norms that can improve the control of SUNASS and its decentralized entities.
In this way, control actions will be in order to detect, within the desired period, any deviation from the objectives of economy, efficiency and effectiveness in the use of institutional resources established by the State and to limit surprises and fancy comments like those that are manifested for now. Such a control system will allow to face the rapid evolution of the economic, social and competitive environment, as well as the changing demands and priorities of citizens and adapt its structure to ensure future growth.
Control actions promote efficiency, reduce the risk of loss of value of assets and help to ensure proper management of resources, the reliability of financial information and compliance with current regulations.
Because control actions are useful for achieving many important objectives, there is an increasing demand for better internal and external control systems and reporting on them.
The control actions applied to the SUNASS line bodies should be considered as a solution to the potential problems in the management and control of the National Superintendence of Sanitation Services.
OBJECTIVES
OVERALL OBJECTIVE:
Formulate the SWOT ANALYSIS that will make it possible to carry out the diagnosis of control actions - period 2000 - 2002 - in the Regulatory Body of Sanitation Services, through which threats and opportunities will be obtained, as well as the strengths and weaknesses of control activities; to carry out the feedback that will facilitate institutional effectiveness.
SPECIFIC OBJECTIVES:
1. Determine the situation found, the actions taken, the expected results and the results obtained; which will be the basis to facilitate the efficiency of the SUNASS management process.
2. Identify the problem, as well as the evaluation of the favorable and adverse conditions that SUNASS went through in the period 2000-2002 in order to make the most convenient decisions to achieve institutional effectiveness.
APPROACH OF THE HYPOTHESIS
GENERAL HYPOTHESIS
The application of SWOT ANALYSIS, will make it possible to carry out the diagnosis of control actions - period 2000-2002 - in the Sanitation Services Regulatory Body, by analyzing changes in terms of threats and opportunities, as well as in terms of strengths and weaknesses; on the basis of which the feedback will be carried out that will facilitate institutional effectiveness.
SECONDARY HYPOTHESES
1. Through the diagnosis of control actions, it will be possible to determine the situation found, the actions taken, the expected results and the results obtained; which will be the basis to facilitate the efficiency of the SUNASS management process.
2. The identification of the problem, as well as the evaluation of the favorable and adverse conditions that SUNASS went through in the period 2000-2002 will allow us to make the most convenient decisions to achieve institutional effectiveness.
VARIABLES AND INDICATORS OF THE INVESTIGATION:
INDEPENDENT VARIABLE:
X. DIAGNOSIS OF CONTROL ACTIONS
Ø INDICATORS:
X.1. DIAGNOSIS
X.2. CONTROL ACTIONS
DEPENDENT VARIABLE:
Y. INSTITUTIONAL EFFECTIVENESS
Ø INDICATORS:
Y.1. MANAGEMENT PROCESS
Y.2. DECISION MAKING
METHODOLOGY
KIND OF INVESTIGATION
This work will be a basic or pure scientific investigation, since it presents the integral theorization through principles, norms, concepts, processes and procedures that SUNASS applies. In this sense, administrative, financial and budgetary information, internal and external audit reports and executive reports will be available. Likewise, there will be organic laws, statutes, internal regulations, manuals, directives and other documents related to the programming and management of the entity. It is estimated that this entire data bank will represent the empirical and numerical support to reach conclusions.
INVESTIGATION LEVEL
It is an investigation of the descriptive-explanatory level, since it presents the current reality of SUNASS in relation to the programming, management and control of the programs, projects and activities they carry out to provide the sanitation service in favor of the Peruvian population and explains the way to obtain efficiency, effectiveness and economy in the use of resources.
RESEARCH METHODS
1) DESCRIPTIVE
Method that will allow detailing, specifying, specifying the facts that have arisen in the Non-Governmental Development Organizations regarding International Technical Cooperation, so that they allow inferring or drawing valid conclusions to be used in the research work
2) INDUCTIVE
This method will allow inferring or formulating conclusions about the incidence of control actions on the efficiency, effectiveness and economy of resources that correspond to all Peruvians.
In the development process of this research work, in addition to these methods, others will be applied, but with less incidence, so that their adequate complementation will allow obtaining the results sought by this Work. In any case, the use of methods or any working procedure or technique is not limiting in the research work.
DESIGN OF THE INVESTIGATION
The design to be applied in the research is that of objectives, the details of which will be presented in the Hypothesis Verification Test, when the thesis has to be developed.
According to the proposed design, the above concepts are represented graphically as follows:
OG = General objective
OE = Specific objectives
CP = Partial conclusions
CF = Final conclusion
HG = General hypothesis
This table indicates that the General Objective is formed from the Specific objectives, with which they are contrasted. In turn, the specific objectives constitute the basis for formulating the partial conclusions of the research work. The Partial Conclusions are properly correlated to formulate the Final Conclusion of the Investigation, the same that must be consistent with the General Hypothesis.
UNIVERSE, POPULATION AND SAMPLE
UNIVERSE
The set of all elemental units to which the research work is limited will be made up of people, processes, procedures, techniques and practices that participate directly or indirectly in control actions.
In the universe, there are as many populations as characteristics you want to register in a certain population frame.
POPULATION
The population of this research work will be made up of SUNASS executives and officials, staff who work in the Office of Institutional Control, staff of the Office of the Comptroller General of the Republic, staff of the Audit Societies and teaching staff from the audit subject of public and private universities; who have the characteristic of knowing and understanding the control actions applied to public entities.
SHOWS
The sample of this research work is a representative part or subset of the population. Due to the technical nature of the investigation, the sample will be non-probabilistic and will be directed specifically to the staff of directors and officials of SUNASS (10), staff who work in the Office of Institutional Control of SUNASS (10), staff of the Office of the Comptroller General of the Republic (10), staff from Audit Societies (20) and teaching staff from the Audit Subject of the Accounting Faculties of public and private Universities (20).
DATA COLLECTION TECHNIQUES
- Documentary review.- They will be used to obtain data on the standards, books, theses, manuals, regulations, directives, reports, budgets, financial and budgetary statements related to Non-Governmental Development Organizations and International Technical Cooperation.
- Interviews.- This technique will be applied to obtain data that allows determining how control actions affect the entity's efficacy and continuous improvement.
- Surveys.- To apply questionnaires, in order to obtain data for the research work.
DATA COLLECTION INSTRUMENTS
- Bibliographic sheet.- Instrument to collect data on legal, administrative, accounting, auditing, books, magazines, newspapers, research papers and the Internet related to SUNASS.
- Interview Guide.- Instrument that will be used to carry out the interviews with SUNASS officials and community managers.
- Survey form.- This instrument will be applied to obtain information from SUNASS workers and users of sanitation services.
ANALYSIS TECHNIQUES
The following techniques will be applied:
a) Documentary analysis
b) Tabulation of tables with quantities and percentages
c) Statistical tables
d) Understanding graphics
e) Data reconciliation
f) Inquiry
g) Tracking
DATA PROCESSING TECHNIQUES
a) Sorting and classification
b) Manual registration
c) Statistical tables
d) Computerized process with Excel
e) Computerized process with SPSS
PRESENTATION OF THE THESIS
TITLE OF THE THESIS
AUTHOR'S NAME
INTRODUCTION
CHAPTER I: METHODOLOGICAL APPROACH
1.1. Bibliographic Background
1.2. Approach to the opportunity or problem
1.3. Delimitation of the investigation
1.4. Justification and Importance
1.5. goals
1.6. Hypothesis
1.7. Methodology
CHAPTER II: THEORETICAL APPROACH
1.1. Research Background
1.2. Historical review
1.3. Legal basis of the investigation
1.4. Conceptual framework
1.4.1. Control actions
1.4.1.1. Audit process
1.4.1.2. Feedback
1.4.2. Institutional effectiveness
1.4.2.1. Management process
1.4.2.2. Decision making
1.5. Definition of related terms
CHAPTER III: PRESENTATION, ANALYSIS AND INTERPRETATION OF THE INTERVIEWS AND SURVEYS CONDUCTED
3.1. Presentation of questions
3.2. Analysis of responses using statistical tables
3.3. Interpretation of responses.
CHAPTER IV: CONTRACTING AND VERIFICATION OF THE PROPOSED HYPOTHESES
4.1. Hypotheses raised
4.2. Results obtained
4.3. Verification and verification
CONCLUSIONS AND RECOMMENDATIONS
BIBLIOGRAPHY
ANNEXES
SCHEDULE
BUDGET
BIBLIOGRAPHY
LAWS:
1. Congress of the Republic (2001) - Law No. 27444 - General Administrative Procedure Law - Lima.
2. Democratic Constitutional Congress (1993) - General Law of the National Superintendence of Sanitation Services, approved by Law No. 26284 - Lima.
3. Public Accounting Office of the Nation (1997) - Compendium of Accounting Regulations - Financial Statements, approved by Resolution No. 067-97-CPN.
4. Comptroller General of the Republic (1995) - Government Auditing Standards, approved by Resolution of the Comptroller No. 162-95-CG.
5. Comptroller General of the Republic (1998) - Internal Control Technical Standards, approved by Comptroller's Resolution No. 072-98-CG.
6. Government of Emergency and National Reconstruction (1992) - Law of Creation of the National Superintendence of Sanitation Services, approved by Decree Law No. 25965 - Lima.
7. Federation of Colleges of Public Accountants of Peru - Board of Deans (2000) - International Standards on Auditing - NIA's - Lima.
8. Federation of Colleges of Public Accountants of Peru - Board of Deans (2002) - International Accounting Standards - IAS - Lima.
9. Ministry of the Presidency (1994) - Regulation of the General Law of the National Superintendence of Sanitation Services, approved by Supreme Decree No. 024-94-PRES - Lima.
10. Ministry of Housing and Construction (2001) - Application of Urban and Rural Sanitation, approved by Ministerial Resolution No. 079-2001-MVC.
11. Presidency of the Council of Ministers (2001) - Supreme Decree No. 017-2001-PCM General Regulations of SUNASS - Lima.
12. Presidency of the Council of Ministers (2002) - Supreme Decree No. 023-2002-PCM Modification of the General Regulations of SUNASS - Lima.
13. National Superintendency of Sanitation Services (1999) - Directive No. 1179-99-SUNASS «Amount to be Billed and Payment Vouchers to be applied by Service Providers» - Lima.
14. National Superintendency of Sanitation Services (2001) - Directive Nº 875-2001-SUNASS «Modification of Directive Amount to Invoice and Payment Receipts to be applied by Service Providers» - Lima.
15. National Superintendence of Sanitation Services (2001) - Regulation of Commercial Claims of Users of Sanitation Services, approved by Resolution of the Board of Directors No. 033-2001-SUNASS-CD - Lima.
16. National Superintendency of Sanitation Services (2001) - Directive for the Contrast of Drinking Water Meters, approved by Resolution of the Board of Directors No. 034-2001-SUNASS-CD - Lima.
17. National Superintendency of Sanitation Services (2002) - Modification of the Directive for the Contrast of Drinking Water Meters, approved by Directive Council Resolution No. 012-2002-SUNASS-CD - Lima.
BOOKS:
18. Andrade E., Simón (1999) Development planning. Lima Editorial Rhodas.
19. Contreras, E. (1995) Auditor's Manual. Lima: CONCYTEC.
20. Cashin, JA, Neuwirth PD and Levy JF (1998) Audit Manual. Madrid: Mc. Graw-Hill Inc.
21. Comptroller General of the Republic. (1998) Government Audit Manual. Lima: Editora Perú.
22. General Comptroller of the Republic. (1998). Internal Control Technical Standards for the Public Sector. Lime. Editora Peru.
23. Chiavenato Idalberto (2000) Introduction to the General Theory of Administration. Mexico. Mc Graw Hill.
24. Elorreaga Montenegro, Gorostiaga. (2002). Internal Audit Course. Chiclayo- Peru. Editing by the author.
25. International Federation of Accountants - IFAC - (2000) International Auditing Standards. Lime. Edited by the Federation of Colleges of Accountants of Peru.
26. Gerry Johnson and Scholes, Kevan. (1999) Strategic Management. Madrid: Prentice May International Ltd.
27. Hernández, F. (1998) The operational audit. Lima: Editorial San Marcos SA.
28. Holmes, AW (1999) Audit. Mexico: Hispano-American Typographical Union.
29. Caballero Bustamante Informational (Audit Informational). (2002). Internal control. Lime. Editorial Tinco SA.
30. Institute of Internal Auditors of Spain - Coopers & Lybrand, SA. (1997). The new concepts of internal control - COSO Report - Madrid. Ediciones Díaz de Santos SA.
31. Institute of Internal Auditors of Peru. (2001). The new framework for the professional practice of internal audit and code of ethics. Lime. Edition by The Institute of Internal Auditors.
32. Koontz / O'Donnell (1990) Modern Administration Course - An analysis of systems and contingencies of administrative functions. Mexico. Lithographic Ingramex SA
33. Panéz, J. (1986) Contemporary Audit. Lima: Iberoamericana de Editores SA.
34. Tafur Portilla, Raúl. (nineteen ninety five). "The University Thesis". Lime. Mantaro Publishing.
35. Terry, GR (1995) Principles of Administration. Mexico: Compañía Editorial Continental SA.
36. Tuesta Riquelme, Yolanda. (2000). "The ABC of Government Auditing". Volume I. Lima. Iberoamericana de Editores SA.
37. Ancash National University and Institute of Management Development. (2002). Management and quality in control systems. Lime. Edition by the two entities.
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