Report of the Audit Committee to the Auditor General of Canada for the 2020–21 Fiscal Year
Chairperson’s message to the Auditor General of Canada
This is the annual report from the external members of the Audit Committee of the Office of the Auditor General of Canada (OAG) for the year ended 31 March 2021.
In June 2020, Karen Hogan was appointed as Auditor General, replacing Sylvain Ricard, who had been appointed as Interim Auditor General since March 2019. Sylvain Ricard retired in October 2020 after more than 22 years of dedicated service at the OAG. The year also marked the retirement of Lucie Cardinal, Assistant Auditor General and Chief Financial Officer, after 25 years of dedicated service. Lissa Lamarche, Assistant Auditor General, became the Chief Financial Officer in December 2020, and 3 new members joined the OAG Executive Committee in early 2021: Sophie Miller as Assistant Auditor General; Nadine Roy as Assistant Auditor General, Chief Security Officer, and Chief Information Officer; and Jerry DeMarco as Commissioner of the Environment and Sustainable Development.
The OAG continued to experience evolving changes as a result of the COVID-19 pandemic. Since March 2020, working remotely and meeting virtually has been the norm for both employees and the Audit Committee. The dedication, effort, and engagement of OAG employees during this challenging period has allowed the Auditor General to deliver on her commitments.
The pandemic had an impact not only on the work of the OAG, but also on the entities the OAG audits. Government institutions, including the OAG, had to quickly mobilize to respond to the public health, social, and economic effects of the pandemic. The OAG delivered on its mandate in the context of the operating environment during the pandemic and met requests from Parliament with more frequent reports, regular appearances before parliamentary committees, and enhanced interaction with audit entities.
Throughout this time, the Audit Committee has served in an oversight capacity with respect to significant business and operational areas for the OAG. The committee responded to the dynamic environment created by the pandemic and supported the transition for Karen Hogan into her role as Auditor General. The independent external members met with her on multiple occasions throughout the year, as requested, to support her in her new role. Given the virtual working environment that was prompted by the pandemic and the increase in the OAG’s activity, the committee adapted by increasing the frequency of its meetings, which meant that it met monthly for most of the 2020–21 fiscal year.
In addition to providing oversight and advice on the OAG’s response to the pandemic, the committee continued its regular business, including overseeing the OAG’s financial statements, internal controls and external audit, accountability reporting, compliance, and practice review and internal audit, and delivering on its enhanced role with respect to governance and strategic risk management.
Membership
The OAG Audit Committee Charter requires that the committee be composed of 3 voting members, all of whom are independent external members. Anita Biguzs, Suzanne Morris, and I are the continuing members from the previous year.
Karen Hogan became a member upon her appointment as Auditor General in June 2020. Andrew Hayes, Deputy Auditor General, was a member throughout the year. Lissa Lamarche, Assistant Auditor General and Chief Financial Officer, became a member upon her appointment as Chief Financial Officer in December 2020. Sylvain Ricard, Interim Auditor General and Deputy Auditor General, and Lucie Cardinal, Assistant Auditor General and Chief Financial Officer, were members until their retirement. Louise Bertrand, Chief Audit Executive, regularly attended the committee’s meetings during the year.
Charter
The committee regularly reviews its terms of reference as it continues to develop practices to serve the OAG effectively, and it annually reviews its charter to align suitably with applicable policy and legislative requirements. In the 2020–21 fiscal year, the committee recommended its charter for approval by the Auditor General at the 22 October 2020 meeting, and she subsequently approved it. The committee’s work plan, minutes, and supporting documentation demonstrate that it has addressed its responsibilities in respect of the following key areas of responsibility: values and ethics, risk management, management control framework, practice review and internal audit, external assurance providers, follow-up on management action plans, financial statements, and accountability reporting.
Priorities
The committee continually assesses emerging issues that are relevant to its oversight of significant business and operational areas. The committee fulfilled its roles and responsibilities under its charter by responding to the environment during the pandemic with more frequent, but shorter, virtual meetings. The committee continued to streamline its work plan to facilitate “deep dive” discussions in significant operational and strategic areas. The committee has continued to expand its enhanced role in support of the Auditor General with a focus on the priorities and challenges faced by the OAG. The committee had 10 meetings during the 2020–21 fiscal year and discussed several topics at these meetings, including the impacts of the COVID-19 pandemic, the OAG’s audit plan, the transition to a new workplace model, employee wellness, office culture, office modernization, emerging technology, and cybersecurity.
Observation
The briefings and reports presented to the committee during the 2020–21 fiscal year, together with the experience of previous years, have provided the committee with a sound understanding of the key issues the OAG faces. The committee found that management and staff were candid and clear on the challenges they face and were receptive to the committee members’ comments and suggestions.
The committee notes that the OAG sets high standards for the quality of its audit products and that it has a satisfactory methodology to conduct reliable audits and studies. In addition, the committee believes that the system of internal controls is satisfactory for the OAG’s needs.
Overall, the committee has observed that the OAG has a rational and systematic approach to addressing its mandate, to monitoring results, and to reporting to Parliament and Canadians.
I therefore respectfully submit this report to the Auditor General in keeping with section 19(a) of the OAG Audit Committee Charter.
Bruce Joyce, Fellow Chartered Professional AccountantFCPA, Fellow Chartered AccountantFCA (Ontario)
Chair of the Audit Committee
Office of the Auditor General of Canada
September 2021