PACC Committee Report

 

AUDITOR GENERAL OF CANADA’S RESPONSE TO

RECOMMENDATIONS CONTAINED IN THE EIGHTH REPORT

 

 

Before dealing with the specific recommendations in the Eighth Report, we will provide an update to a recommendation contained in the Committee’s  Sixth Report (36th Parliament, Second Session). The Sixth Report recommended that the Office of the Auditor General provide additional detail regarding the status of recommendations and observations whose implementation is below expectation.  In particular, the Committee requested that the Office include a list of departments and agencies that have demonstrated low rates of implementation and the major areas in which implementation has been problematic.

 

The Office is committed to improving the reporting of follow-up findings as well as its follow-up practice.  It has included in its 2001 Performance Report a series of examples that show the extent of progress of certain departments in implementing our recommendations.  For example, Exhibit 6 of the Report shows that Human Resources Development Canada, National Defence, and Health Canada have taken corrective action in some areas but need to do more to fully implement our recommendations and resolve the issues identified in our audits.

 

 

RECOMMENDATION 1

 

That the Office of the Auditor General conduct a thorough review of its methods of assessing its recommendations and observations, including their impact, and rates and timeliness of adoption, and report the results and conclusions in its Performance Report for the period ending 31 March 2002.

 

            RESPONSE

                       

The Office is currently developing a new follow-up audit approach that will provide Parliament with better information on progress made by departments in resolving issues raised in our reports.  New follow-up chapters will focus on matters that need additional parliamentary attention. We will continue to monitor the implementation of our recommendations and update our database of recommendations.  Work has been done on clarifying the criteria used to assess the progress in implementing our recommendations.  The Office will report the results of this work in its 2002 Performance Report.

 

 

 

RECOMMENDATION 2

 

That the Office of the Auditor General pursue efforts to estimate the money that government operations may have saved, directly or indirectly, as a result of the work and recommendations of the Office, and that it report these instances as examples in its annual Performance Report.

 

            RESPONSE

 

We fully agree that it is important to estimate savings that may have resulted from the work of the Office. Savings are not a perfect measure of the outcome of the work of the Office because they cannot be directly attributed to us, but they do serve to illustrate one of many effects the legislative auditor’s work may have on government operations.  Our 2001 Performance Report includes some examples of savings.

 

 

RECOMMENDATION 3

 

That the Office of the Auditor General of Canada further clarify and strengthen the links between its objectives and planned activities, as stated in its annual Report on Plans and Priorities, and the activities it has completed and the outcomes it has achieved, as reported in its annual Performance Report.

 

            RESPONSE

 

The Office will continue to make every effort to provide clearer links between objectives, activities, and results.  Our 2001-02 Report on Plans and Priorities includes a results chain that links our outputs to our outcomes.  It also includes targets for selected outcome measures.  Future reports on plans and priorities will include additional performance measures.  As we continue to implement the new performance framework, and integrate it with our planning and management information systems, information on the outcomes achieved will be easier to document and report in the annual Performance Report. For example, in our 2001 Performance Report, we report our performance against the results chain adopted last year.

 

 

RECOMMENDATION 4

 

That, in its annual Performance Report, the Office of the Auditor General begin to show actual hours spent on individual audits compared against budgeted hours.

 

            RESPONSE

 

The Office has begun reporting this information. The 2001 Performance Report includes two tables (tables 7 and 8) that compare budgets and actual costs of audits. Table 7 shows budgeted and actual costs of audits completed in 2000–01. Table 8 shows budgeted and actual audit hours spent in each entity audited in  2000–01.  It also shows the cost of our work.

 

 

RECOMMENDATION 5

 

That the base budget of the Office of the Auditor General of Canada be immediately increased by an amount that is sufficient for the Office to be able to perform all duties that are imposed by statute or as are required by Parliament.

 

            RESPONSE

 

The government will respond separately to this recommendation in its comprehensive response.

 

In 2001–02, subject to Parliament's approval, the Treasury Board increased our base budget by about 15 percent.  These additional funds will be used to modernize our audit methodology and tools, re-invest in our human capital, and expand our audit capacity. 

 

 

RECOMMENDATION 6

 

That the current funding arrangements for the Office of the Auditor General be subject to review by a standing committee of the House of Commons during the current session of this Parliament.

 

RESPONSE

 

The government will respond separately to this recommendation in its comprehensive response.

 

The Office would be pleased to assist such a committee in its deliberations should a standing committee of the House decide to review the funding arrangements for the Office.

 

 

RECOMMENDATION 7

 

That the Office of the Auditor General conduct random audits of the information contained in the performance reports of departments and agencies in order to verify, among other things, that the information contained in these reports is a fair representation of accomplishments against goals and objectives.

 

            RESPONSE

 

The Office annually does audits of the performance information for three service agencies: Parks Canada, the Canada Customs and Revenue Agency, and the Canadian Food Inspection Agency.  Our assessments are found in the annual reports of those agencies.  In the course of our regular value-for-money audits, we frequently review the reports against criteria for good performance reporting.  We also have done government-wide audits of performance reporting, most recently in Chapter 19 of our 2000 Report.  We agree with the Committee that the potential for reporting performance information to Parliament has yet to be met and have been disappointed with the progress to date.

 

We are exploring efficient ways to carry out further audit work as recommended by the Committee. In the short term, it is our intention to undertake a review of several of the departmental performance reports to be tabled this fall, and to report our findings in April 2002.  We will be examining, among other things, the extent to which the information reported is a reasonable representation of accomplishments against goals and objectives.  For the longer term, we will review our approach to assessing departmental performance reports.

 

 

RECOMMENDATION 8

 

That senior management of departments and agencies be required to include, in their annual performance reports, signed statements attesting to the comprehensiveness and accuracy of the information provided therein. This requirement should take effect beginning with the annual performance reports for the period ending 31 March 2002.

 

            RESPONSE

 

The government will respond separately to this recommendation in its comprehensive response.

 

The Office believes this would be an excellent incentive to increase the reliability, credibility, and quality of the information in the departmental performance reports.  The Office has included such a statement in its 2001 Performance Report.