MORE INFORMATION/OPTIONS

The panel was established in response to calls from the public to establish a Municipal Auditor General to improve the City’s governance and enhance transparency. The panel will review and advise on the best governance process for its Internal Audit function. 

Financial Statement Attest Audit

Financial Statements of an organization are examined by an independent auditor who expresses an opinion (attests) whether the statements present fairly the financial results of the organization in accordance with national or international accounting standards. An audit is conducted in accordance with national auditing standards. An attest audit is not designed to determine whether the resources of an organization are being used effectively.

Performance Audit

Performance audits will typically focus on either: Compliance – has the organization complied with policies and procedures; Value-for-Money (VFM) – has the organization used its resources in an efficient and effective manner with due regard for economy. These are normally conducted in accordance with recognized auditing standards.

The City’s Internal Audit function consists of two individuals with professional accounting designations who are employees of the City. The Internal Auditors report to a Standing Committee of Council – Audit Committee. The Audit Committee reports to Council. The Audit Committee has provision for 2 external representatives with the remaining members being members of Council. The work plan of the Internal Auditors is developed in conjunction with City staff and is approved by the Audit Committee. The work plan typically consists of about 3 performance audits per year. The work plan may be interrupted by specific requests for special audits at the request of City staff or Council.

There is no consistency across Canada. However, some internal audit function is common. Some municipalities have a Municipal Auditor General – appointed either by provincial legislation or municipal by-law. Some larger municipalities have both. A Municipal Auditor General is typically appointed for a limited term – 5 to 7 years and reports to Council. It may also report publicly.

Some broad options which the City could consider are:

·  Status Quo

·  Status quo with governance changes

·  Enshrine mandate of Internal Audit in City by-laws

·  Increase external membership on Audit Committee

·  Audit Committee have a greater role in Internal Audit resourcing

·  Increase Internal Audit Function staff with governance changes

·  Move to a Municipal Auditor General structure

1.  If Status Quo - Maintains staff complement at 2 persons, No budgetary impact. Generally, resources allow for 3 about performance audits per year. Work plan is subject to additional work requests from the City

2.  If Status Quo with Governance Changes – Would be similar to number 1 above but Audit Committee would consider whether additional work requests from City would be entertained. The value the City currently gets from having Internal Audit available for special projects could be diminished.

3.  If Increase Internal Audit staff with governance changes - Additional audits could be performed annually, Audit Committee would consider whether additional work requests from City would be entertained, the value the City currently gets from having Internal Audit available for special projects could be diminished and there would be additional cost to City

4.  If a Municipal Auditor General - Similar to number 3 above but legislation may allow Auditor General complete autonomy in work performed. Auditor General could raise the public profile of performance audits.