How We Conduct Performance Audits
The Office of the Auditor General of Canada conducts performance audits using a three-phase process, guided by professional standards and methodology, that can take up to 18 months. During each phase, a multidisciplinary audit team works closely with an advisory committee of experts. The committee offers advice and reviews audit plans and results.
In the planning phase, the audit team sets out to understand the organization being audited—the Government of Canada department or agency—to get "the big picture." This includes finding out about applicable legislative authorities, the way the department or agency has structured itself to achieve its mandate, and the challenges it faces in the environment in which it operates.
Since audits focus on how well an entity is managing major risks, auditors take these into consideration when identifying areas that will be examined by an audit. They then develop the criteria against which the audited activities can be assessed, essentially identifying what they would expect to find if all systems and processes were working properly.
During the examination phase, the audit team gathers evidence to allow it to report on the strengths and weaknesses of the Government of Canada organization or program that it is auditing. Evidence‑gathering can include holding interviews with program staff and stakeholders and reviewing documents such as legislation, program design documents, studies, evaluations, and program files. It can also include benchmarking and testing key transactions, systems, and controls.
The audit team compares the evidence it gathers with its expectations or criteria. The team ensures that any resulting observations and conclusions are fair and well‑founded, and that recommendations could lead to improvements.
In the reporting phase, the audit team drafts the document that will eventually be included in the Auditor General’s report to the House of Commons. At this point, the audit team reviews facts and the results of audit tests with the Government of Canada department or agency being audited. These organizations are given an opportunity to correct facts and provide comments.
The Office reports its findings, which may include areas that are working well and recommendations for improvement. Reports to Parliament on performance audits answer the following key questions:
- What did the audit look at?
- Why is it important?
- What would the audit team expect to find if everything were working properly?
- What did the audit team in fact find?
- What is working well?
- What needs improvement? and
- What did the audit team recommend to improve operations or performance?
The organization being audited responds to each recommendation, and the Office of the Auditor General of Canada publishes the organization’s responses . The responses, which are summarized at the beginning of the report, provide the Office of the Auditor General and the House of Commons Standing Committee on Public Accounts with a basis for following up on the audit. Any areas of substantial disagreement between the department or agency and the audit team are highlighted.