Required Reporting by Federal Organizations

Opening Statement to the Standing Committee on Public Accounts

Required Reporting by Federal Organizations

(Report 2—2015 Spring Reports of the Auditor General of Canada)

13 May 2015

Nancy Cheng, FCA
Assistant Auditor General

Mr. Chair, thank you for this opportunity to discuss Report 2, Required Reporting by Federal Organizations, of the 2015 Spring Reports of the Auditor General of Canada. Joining me at the table are John Affleck, Principal, and Colin Meredith, Director, who were responsible for the audit.

This audit focused on recurring reporting requirements set out by the Treasury Board, by the Public Service Commission of Canada, and by statute. We undertook this audit to respond to long-standing concerns about the burden these reporting requirements create for federal departments, federal agencies, and Crown Corporations.

The overall objective of the audit was to determine whether selected reporting requirements for federal organizations efficiently support accountability and transparency, and generate information used for decision making in policy development and program management.

Overall, we found that reporting intended to support accountability and transparency was serving its intended purposes.

We also found that clear purposes and timelines had been established for the selected reporting requirements, and that central agencies had provided guidance and support to help federal organizations meet them.

However, with respect to the efficiency of required reporting, we found that neither the Treasury Board of Canada Secretariat nor the Public Service Commission of Canada had determined the level of effort or costs involved in meeting the requirements we examined. In our view, determining level of effort and costs would lead to a greater understanding of the resource implications of these requirements, and would allow them to be adjusted accordingly.

Furthermore, we found that the Secretariat has not maintained a comprehensive inventory and schedule of the 60 recurring reporting requirements stemming from its policies, directives, and standards. Such a tool would both help the Secretariat address the burden of Treasury Board reporting requirements, and help reporting organizations efficiently prepare the required reports.

The Secretariat made some accommodation for the sizes and mandates of reporting organizations when reporting requirements were first established, and during subsequent reviews. However, we found that most Treasury Board reporting requirements applied equally to all organizations, regardless of their sizes or mandates. For example, the Canadian Polar Commission—a small organization with 11 staff members—was required to prepare 25 annual or quarterly reports.

We noted that the efficiency and value of quarterly financial reports could be improved to better support accountability to Parliament. We identified only one routine use of the information in quarterly financial reports—the Office of the Parliamentary Budget Officer used the information in preparing assessments of in-year spending for parliamentarians.

Six of the eight reports that we examined were intended to support accountability and transparency. We observed that federal organizations were preparing these six reports. However, they were not meeting the remaining two reporting requirements, which were intended to support their internal decision making.

We noted that 20 percent of departmental investment plans had not been completed as required. We also found that about half of the departmental security plans that were due by June 2012 had not been finalized at the time of our audit. A departmental security plan is intended to support internal decision making by providing an integrated view of an organization’s security requirements.

In addition, we found that the Secretariat did not take full advantage of the opportunity to use the information in the departmental security plans. For example, although the Secretariat reviewed the plans it received, and used them to support its policy review, it did not use the information to identify broader government security issues.

In the Report, we made six recommendations aimed at improving the efficiency and usefulness of required reporting. The Secretariat and the Commission have agreed with our recommendations.

Mr. Chair, this concludes my opening remarks. We would be pleased to answer any questions the Committee may have. Thank you.