The EMB’s internal financial audit is its final internal checking mechanism to promote financial probity and integrity. An external financial audit of the EMB reviews the EMB’s accounts to provide an independent opinion of their completeness, compliance, integrity, and accuracy. Most EMBs are required to prepare and submit annual audited accounts, which are linked to achievements and activities based on the annual plan of work. The report may reflect the level of financial contributions by the state and by external sources, where appropriate, and the expenditure of these funds.

Electoral events generate many financial transactions through acquisition of election supplies, materials, and equipment and the employment of large numbers of additional staff. Many EMBs have a relatively large dispersed staff, including thousands of temporary workers, and procure millions of dollars-worth of electoral equipment, services, and materials, often in a very short time. This is an environment where corruption and misappropriation of funds may occur if adequate safeguards are not in place.

Financial audits aim to provide reasonable assurance that the financial statements of an audited EMB represent fairly the financial position, results of operations, and cash flows in conformity with generally accepted accounting principles and financial reporting standards. Such audits seek to establish whether all financial transactions have followed the financial compliance criteria, based either on the EMB’s own rules and regulations or on more general public-sector financial accountability laws or rules. They also assess and provide an opinion on whether the EMB’s internal control structure for finance and safeguarding assets is suitably designed and implemented to ensure accuracy and integrity in financial management records and to prevent fraud.

Financial audit may cover some or all of the following areas:

a) financial statements and information (such as revenue and expenses, cash receipts and disbursements, and the inventory of assets);

b) budget requests and variations between estimated and actual financial performance;

c) compliance with laws and regulations, especially on procurement, accounting, reporting on contracts and grants, and anti-corruption measures; and

d) internal controls on funds, assets, and financial reporting