Commentary on the 2022–2023 Financial Audits—2022–23 Financial Commentary highlights overpayments and gaps in IT controls

Commentary on the 2022–2023 Financial Audits2022–23 Financial Commentary highlights overpayments and gaps in IT controls

Ottawa, 24 October 2023—Today, the Office of the Auditor General of Canada (OAG) released its Commentary on the 2022–2023 Financial Audits. This is not an audit report, but rather observations and themes highlighted through the OAG’s financial audits of federal organizations. These include COVID‑19 benefit overpayments, IT controls, the Trans Mountain Corporation, and pay administration.

The OAG’s performance audit report Specific COVID‑19 Benefits, released in 2022, identified that an estimated amount of at least $27.4 billion in payments to individuals and businesses should be investigated further. The commentary report shows that, through post‑payment verifications, the government of Canada has identified more than $4 billion in overpayments or ineligible payments of COVID‑19 benefits this fiscal year, bringing to a total of $11 billion the amount identified over the past 3 years. The government has stated that post-payment verifications will continue for a number of years.

The commentary flagged gaps in controls over the access granted to employees to key government systems that store and process financial data. While there were no indications that inappropriate changes were made, some employees had access to government systems and databases that they did not need to fulfill their duties. As this situation increases the risk of wrongdoing, the report encouraged all federal organizations to review, monitor, and strengthen their controls over access to government financial information.

For the second year, the commentary draws attention to the uncertain financial situation of the Trans Mountain Corporation. The corporation’s financial statements call into question its ability to fund the remaining construction costs of the pipeline expansion project and to make the necessary payments on its existing debt without the direct financial support of the Government of Canada.

Phoenix pay errors also continued this fiscal year with an increase in errors compared with the previous one. The number of pay action requests waiting to be processed has also increased from 310,500 to 405,000 this year.

The Commentary on the 2022–2023 Financial Audits highlights the results of the financial audits conducted in 69 federal organizations for fiscal years ended between July 2022 and April 2023. Observations of the Auditor General are significant enough to be raised to parliamentarians and should be viewed as opportunities for the government to improve administrative and financial practices and controls. As such, the OAG provided the Government of Canada with a clean audit opinion on its 2022–23 consolidated financial statements. This opinion provides credibility to the government’s financial reporting.

The Commentary on the 2022–2023 Financial Audits is available on the Office of the Auditor General of Canada website.

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