TOWN OF MARKHAM – AUDITOR GENERAL - MANDATE

 

PURPOSE

The Auditor General assists Council in holding itself and its administrators accountable for the quality of stewardship over public funds and for the achievement of value for money in operations.  

 

The Auditor General office is an independent, objective assurance activity designed to add value and improve municipal operations.  The audit process assists a municipality to accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the risk management, control and governance processes by carrying out financial control audits (excluding attestation on financial statements, which is the purview of the appointed External Auditors), compliance audits, and performance audits focused on effectiveness and efficiency of processes, programs, departments.

 

AUTHORITY

Section 223.19 of the Ontario Municipal Act authorizes municipalities to appoint an Auditor General.    The mandate for the Auditor General's Office is approved by Council through General Committee.

 

The Auditor General has the authority to:

  1. Have unrestricted access to all activities, records, systems, property, meetings and personnel necessary to conduct audits
  2. Have full and free access to the Mayor and Council
  3. Set frequencies, select subjects, determine scopes of work, and apply the techniques required to accomplish audit objectives
  4. Obtain the necessary assistance of personnel in units where audits are performed.  Staff of those organizations within the Auditor General's scope have a duty to co-operate with the Auditor General and to not obstruct audit activities.

 

RESPONSIBILITIES

Section 223.20 of the Ontario Municipal Act states that the “municipality, its local boards and the municipally-controlled corporations and grant recipients shall give the Auditor General such information regarding their powers, duties, activities, organization, financial transactions and methods of business as the Auditor General believes to be necessary to perform her duties”.  

 

Council and its administrators have a responsibility to inform the Auditor General of significant developments, events, and changes in strategies and operating plans for the Town of Markham to ensure the Auditor General has sufficient information to deliver on her mandate in an effective and efficient manner.

 

The Auditor General is accountable for developing and delivering a programme of audit work aimed at assisting Council in holding itself and its administrators accountable for the quality of stewardship over public funds and for the achievement of value for money in operations.  

 

Duties include:

 

  1. To conduct, or cause to be conducted, audits on behalf of Council in the areas of financial control audits (excluding attestation on financial statements, which is the purview of the appointed External Auditors), compliance audits , and performance audits focused on effectiveness and efficiency of processes, programs, departments;

 

  1. To follow up annually on audit recommendations as to the effective implementation of management actions resulting from audit recommendations;

 

  1. To examine problems and carry out special assignments identified and recommended by the Auditor General, and further approved by a simple majority resolution of General Committee;

 

  1. To submit semi-annually to General Committee an updated audit plan including recommended changes to the multi-year plan;

 

  1. To report her findings, conclusions, recommendations to the audited parties, local management, and General Committee of Council.    Management is responsible for addressing the Auditor General recommendations and maintaining adequate risk management and system of controls;

 

  1. To report out to the General Committee of Council quarterly.

 

 

SCOPE

The Auditor General is responsible for evaluating all programs and activities of all Town departments, commissions, agencies, boards, municipally- controlled corporations, grant recipients and the offices of the Mayor and members of Council.   Boards and municipally-controlled corporations included in scope are defined as those where the Town holds more than 50 % of the shares or appoints more than 50 % of the members of the Board.

 

At the request of Council, the Auditor General may conduct compliance, performance, or financial audits of autonomous organizations that have an agreement with the Town that contains provisions for audit by the Town. 

 

INDEPENDENCE

The Auditor General reports to Council through General Committee and is independent of the Town administration. The Auditor General must be independent from management at all times in order to be effective in executing her work freely and objectively. 

 

The Auditor General shall:

  1. report directly to the General Committee of Council, and
  2. have no direct responsibility or authority over any operating activities and shall not relieve others of their responsibilities

 

The appointment of a person to the position of Auditor General may be made, suspended, or revoked only by a simple majority vote of Council;

 

The Auditor General’s audit plan is approved by Council and no deletions or amendments to the plan shall be made except by the Auditor General, other than Council may add to the audit plan by a simple majority vote of Council.

 

 

QUALITY ASSURANCE AND IMPROVEMENT PROGRAM

The Auditor General shall develop and maintain a quality assurance and improvement program in accordance with professional standards.  The program includes internal measurements using key performance indicators reported on semi-annually and external assessment at least every 5 years.

 

 

STANDARDS OF AUDIT PRACTICE

The Auditor General and staff working under her direction will comply with the Standards for the Professional Practice of Internal Auditing of The Institute of Internal Auditors (IIA).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GLOSSERY OF TERMS

 

ACTIVITIES

As applied in the audit scope, refers to support processes such as accounts payable, payroll, information security, human resources and any other functions undertaken.

COMPLIANCE AUDIT

An audit focused on adherence to laws, regulations and an organization’s policy and procedures.

CONTROL

Control comprises those elements of an organization (including the resources, systems, processes, culture, structure and tasks) that taken together, support people in the achievement of the organization’s objectives

EFFECTIVE

Achieves the stated intended outcomes, goals, objectives

EFFICIENCY

Achieves effectiveness without wasting effort, energy, or money  

FINANCIAL AUDIT

An audit focused on controls that ensure financial information is accurate, complete and safeguarded.

GOVERNANCE

The processes and structures used to direct and manage the business and affairs of an organization. 

INDEPENDENT

Independence is achieved through organizational status and supports an objective state of mind.

municipally-controlled corporations

Where the Town holds more than 50 % of the shares.

OBJECTIVITY

Is an independent mental attitude that requires activities to be done in such a manner that the person has an honest belief in their work product.  Objectivity requires auditors not to subordinate their judgement on audit matters to that of others.

PERFORMANCE AUDIT

An audit focused on efficiency and effectiveness of the particular activity in acquiring, protecting, and using its resources to achieve desired results.

PROGRAMS

As applied in the audit scope, refers to group of activities to deliver municipal services to the public.

RISK

Risk is the uncertainty that surrounds future events and outcomes; it is the possibility of experiencing adverse consequences as a result of choices and actions

RISK MANAGEMENT

The processes by which organizations identify, evaluate, and respond to risk.