Auditing of Efficiency
Forward
Purpose of the guide
This guide is for all staff conducting value-for-money audits of departments and agencies. It is intended to enhance their understanding of the Auditor General's mandate for auditing the efficiency of government operations, and to help them fulfill that mandate.
Authority and application
The guidance in this document should be tailored as appropriate to meet the particular needs of the audit and the operating characteristics of the organization being audited. The Guide should be used in conjunction with the Value-for-Money Audit Manual. Although designed to offer guidance for work carried out on value-for-money (VFM) audits under the Auditor General Act, it should also be of assistance in conducting Special Examinations of Crown corporations.
Contents of the guide
This Guide defines efficiency and provides a basic understanding of efficiency concepts. It outlines the framework of criteria and sub-criteria for addressing the efficiency components of value-for-money audits of departments and agencies. It also presents an overview of how these concepts and criteria are applied in the planning, examination, and reporting phases of an audit.
Responsibilities
Value-for-money audits are generally conducted by multidisciplinary teams. This Guide is intended to help those teams identify efficiency issues and to undertake some of the work in auditing them, as appropriate. However, some of the work involved in auditing efficiency is specialized, and the Guide highlights those areas where the assistance of the relevant Functional Responsibility Leader (FRL) should be sought.
Conducting an audit of efficiency places responsibility on the audit Principal to determine:
- the extent to which the audit team members have sufficient and appropriate skills to conduct the work themselves;
- whether the team requires outside specialists with specific expertise in the operational activity to be audited and in the auditing of efficiency; and
- the nature, extent, and timing of any consultation with the Results Measurement Audit FRL.
Because they are related to resource management, efficiency issues are pervasive. Pursuing them may lead into overlapping areas such as human resource management, financial management and control, information technology, effectiveness, and reporting to Parliament. In such cases, it may be necessary for auditors to consult with the relevant FRLs as appropriate.