Policy on Contracting and Procurement

1. Authority

2. Policy statement

3. Application and effective date

4. Roles and responsibilities

5. Policy requirements—goods and other services

6. Policy requirements—professional services contracts

7. Differences between OAG policy and Treasury Board policy—professional services contracts

8. References

9. Enquiries

1. Authority

1.1 Pursuant to the Auditor General Act, the Office of the Auditor General (OAG) has the authority to contract for professional services.

1.2 The OAG is subject to the Treasury Board Contracting Policy for the contracting of other services and the procurement of goods. As well, the OAG has special delegated contracting authority to purchase up to $500,000 in computer equipment (and to amend such contracts by up to $200,000) and $250,000 in other goods (and to amend such contracts by up to $125,000).1

2. Policy statement

2.1 The objective of this policy is to ensure that the OAG contracts for professional services and procures goods and other services in a manner that will

  • stand the test of public scrutiny in matters of prudence and probity;
  • make it easier for bidders to access contracting opportunities;
  • ensure that an open, competitive process is used, where appropriate, and reflect fairness in the spending of public funds, while supporting operational objectives; and
  • conform to applicable legislative, regulatory, and policy authorities.

3. Application and effective date

3.1 This policy applies to all contracts and procurement at the Office of the Auditor General.

3.2 To ensure that this policy is fully understood, it should be read in conjunction with the Manager's Guide to Contracting and Procurement, which also applies to all contracts and procurement at the OAG.

3.3 This policy takes effect on 1 April 2007.

3.4 This policy replaces the previous Policy on Contracting for Professional Services dated 13 July 2000, as of the effective date indicted above.

4. Roles and responsibilities

4.1 Assistant auditors general, service leaders, and managers are responsible for applying this policy as it pertains to their contracting and procurement activities and authorities.

4.2 The Comptroller is responsible for monitoring the application of this policy, administering the policy, and issuing guidance (via the Contracting and Procurement Services unit).

4.3 The managers' contracting and procurement authorities are defined as part of the Office's delegation of Financial Signing Authorities approved by the Auditor General and the Minister of Finance. The delegation includes specific contract approval authority for

  • professional services,
  • goods and other services, and
  • hospitality.

4.4 Senior managers have been delegated the following authority for approval of professional services contracts:

  • Assistant auditors general have full authority for their own budgets (for, audit groups).
  • Principals and services leaders have authority up to $25,000 for their own budgets (for responsibility centres).

In addition, the following positions have full authority for the entire Office: the Auditor General, the Deputy Auditor General, the Assistant Auditor General—Corporate Services, the Comptroller, and the Director of Contracting and Administrative Services.

5. Policy requirements—goods and other services

5.1 With respect to contracting for goods and other services, the Office of the Auditor General follows the Treasury Board Contracting Policy and other applicable statutes, regulations, and requirements.

6. Policy requirements—professional services contracts

6.1 Competition is the norm. All contracts should be tendered competitively unless there is valid reason not to do so, as set out in the Manager's Guide to Contracting and Procurement. Different suppliers shall be contacted and bids solicited for all contracts where the fees portion exceeds $25,000. Contracts that exceed the North American Free Trade Agreement (NAFTA) limit must be put out to public tender.

6.2 Dollar limit on non-competitive contracts. The approval of the Deputy Auditor General will be required for any contract where the cumulative amount for one contractor in a fiscal year exceeds the NAFTA limit, and when a fourth non-competitive contract is to be issued to the same contractor within a fiscal year.

6.3 Trade agreements. The North American Free Trade Agreement, the World Trade Organization—Agreement on Government Procurement, and the Agreement on Internal Trade apply to the Office.

6.4 Contract amendments. Contracts should not be amended unless the amendment is properly justified and is in the best interest of the Office. The extra work to be performed must be carefully defined and should be restricted to unforeseen changes in scope. The total of all amendments should not exceed 100 percent of the value of the original contract.

6.5 Employee-employer relationships. The Office will ensure that an employee-employer relationship will not result when contracting for the services of individuals.

6.6 Support of national objectives. Where appropriate, contracts shall support the following national objectives: promoting Aboriginal economic development, minimizing negative environmental impact, and promoting sustainable development and employment equity.

6.7 Security. All contracts must comply with the applicable requirements of the OAG Security Policy.

7. Differences between OAG policy and Treasury Board policy—professional services contracts

7.1 The OAG's policy and requirements for professional services contracts are established based on the specific authority conferred under the Auditor General Act. These generally mirror the requirements of the Treasury Board Contracting Policy, except for the key differences outlined in the next paragraph. For contracting issues and elements not specifically addressed by its own policy or Managers' Guide, the OAG normally defers to the Treasury Board Contracting Policy and other applicable authorities.

7.2 The key differences between the Treasury Board Contracting Policy and the OAG's requirements for professional services contracts are:

7.2.1 Contracting limits.

Contracts in which the fees portion are valued at $25,000 or less may be sole sourced. GST, travel, and other expenses are not included in the calculation of the $25,000 for sole sourcing purposes.

7.2.2 Contract amendments.

Contracts for which the original value was less than $25,000 in professional fees may be amended such that the total amendments do not exceed 100 percent of the value of the professional fees of the original contract.

Contracts for which the value of the original contract was greater than $25,000 but less than the NAFTA threshold may be amended up to 100 percent of the original value but not greater than the NAFTA threshold, including fees, expenses, and GST.

8. References

Auditor General Act

Financial Administration Act

Government Contracts Regulations

Treasury Board Contracting Policy

Financial Signing Authorities delegation instrument.

Manager's Guide to Contracting and Procurement

9. Enquiries

Please direct enquiries about this policy to the OAG Contracting and Procurement Services of the Comptroller's Group.

Document version control:

Document status and version:

Reviewed by and date:

Approval and date:

Official version dated 1 April 2007

EWG-Finance, 4 December 2006

Executive Committee, 17 January 2007