Opening Statement to the Standing Committee on Public Accounts

International Peer Review of the Value for Money Audit Practice of the Office of the Auditor General of Canada

11 March, 2004

Sheila Fraser, FCA
Auditor General of Canada

Mr. Chair, thank you for providing us with the opportunity to table with the Committee a copy of the February 2004 Peer Review Report on the Office of the Auditor General. Accompanying me today is David Rattray, Assistant Auditor General, who had the responsibility for arranging for the external review and providing leadership throughout the process.

This external review of our value-for-money audit practice by an international team of peers is a first for a national audit office. It was undertaken partly in response to a question that is often asked: Who audits the Auditor General?

In February 2003, we asked members of the international audit community if they would be interested in participating in a review of the Office's value-for-money audit practice.

The peer review of our Office was carried out over the course of a year by a team led by the United Kingdom's National Audit Office, with representatives from the national audit offices of Norway, the Netherlands, and France. The General Accounting Office of the United States participated as an observer.

The purpose of the review was to assess the extent to which the Office of the Auditor General's value-for-money audit practice is designed to reflect recognized standards of professional practice and is operating effectively to meet the Office's objective of producing independent, objective, and supportable information that Parliament can rely on to examine the government's performance and hold it to account.

The results of the peer review are very positive. I am pleased that the report concluded that the Office's value-for-money (VFM) audit practice was suitably designed and operating effectively to achieve our objectives. The report also identified a number of good practices in the Office's VFM process and quality management framework. As might be expected from any audit, the review identified potential opportunities to enhance the quality of the Office's value-for-money audit policies and practice. We will address these in the next few months and I am also tabling a copy of the Office's action plan for addressing the suggestions made in the Peer Review Report.

I would like to provide you with a bit of background on how the review was conducted.

In preparation, the Office conducted a thorough assessment and update of its Quality Management Framework and launched a revised Value-for-Money Audit Manual in December 2002.

The peer review team met in February 2003 to work out details of the peer review, such as leadership, participants, objectives, and scope and criteria. In May the team signed a memorandum of understanding with the Office for the peer review.

The review was conducted between June and November last year and the report was completed in February 2004.

Once tabled with your Committee, the report and the action plan will be available on our Web site. I understand it may be possible to have the Public Accounts Committee table the report in the House of Commons and I hope this can be done.

In closing, I would like to reiterate how pleased we are with the results of this review. It was a valuable learning experience for all involved. It opened up lines of practice exchange with our international colleagues that we hope will assist all national audit offices in improving professional practices. We now have an arrangement with a global working group of national audit offices that will conduct external reviews of value-for-money practices in other countries. In fact, my Office is leading the peer review of the General Accounting Office in the United States. The first steps of that review are already under way.

I would also be pleased to appear before the Committee with Caroline Mawhood, the Lead Reviewer from the National Audit Office of the United Kingdom, should Committee members wish to have a hearing on this report later this year. Perhaps this could be combined with a hearing on our Report on Plans and Priorities that is expected to be tabled later this spring.

Thank you, Mr. Chair. We would be pleased to respond to questions.