QUÉBEC, Feb. 26, 2015 /CNW Telbec/ - Today, Mr. Michel Samson, Acting Auditor General, makes public the report entitled Audit of Financial Information and Other Related Work (Winter 2015).
Observations of the Acting Auditor General (Chapter 1)
In the first chapter, Mr. Samson deals with the pre-election report included in Bill 28. He underlines the fact that over the last year, his institution was asked three times to carry out audit work on financial information documents. Mr. Samson believes it is highly desirable that the conduct of audits as critical as these be more predictable. Therefore, he welcomes favourably the bill addressing the pre-election report, and he adds that if parliamentarians would like him to express an opinion on the contents of the next pre-election reports, he will work actively on it.
In this chapter, he also talks about funds allocated to local development centres and the government's consolidated financial statements. Furthermore, considering the importance of these statements for reporting on the province's public finances, he reiterates his invitation to entrust the Public Administration Committee or another parliamentary committee with the responsibility of the Public Accounts' study.
Finally, he presents the conclusions of his analysis of the December 2014 economic and financial update. The work related to this analysis is the subject of a separate report which is also being made public today.
Government's Consolidated Financial Statements and Other Elements of Interest (Chapter 2)
The government's consolidated financial statements respect, with one exception, the Canadian Public Sector Accounting Standards for a second year in a row. The exception arises from a difference of opinion concerning the interpretation of the accounting standard on government transfers.
According to the estimate of the Auditor General, the net debt and accumulated deficits as at March 31, 2014, are understated by $8.5 billion, and the annual deficit is understated by $439 million. Considering the absence of information enabling the identification of the work performed at the end of the fiscal year for contractual obligations totalling $3.1 billion, the additional adjustments to be made to these amounts could not be determined. The auditor's report also mentions a non-compliance element with the Balanced Budget Act. On November 26, a bill was submitted to the National Assembly in order to resolve the situation.
Sensitive Information and Other Findings (Chapter 4)
Work likely to be of interest to parliamentarians in a context that requires stringent management of public funds is addressed in Chapter 4. The findings result from work carried out at the École nationale des pompiers du Québec and the Université du Québec à Montréal. The École has contravened notably to applicable opening of public procurement intergovernmental agreements by having recourse without public call for tenders to a print service provider to which it disbursed more than $1.8 million. The Université du Québec à Montréal, on its part, awarded to managers lump sums totalling more than $350,000. This practice is not in compliance with the Act to implement certain provisions of the Budget Speech of 30 March 2010, reduce the debt and return to a balanced budget in 2013-2014.
Funds Allocated to Local Development Centres (Chapter 6)
A value-for-money audit engagement on funds allocated to local development centres was undertaken in 2014. Following the signing of the transitional fiscal pact last November and the significant changes it brings to the regional governance structure, the Acting Auditor General deemed it preferable to end the engagement. However, to the extent that the government will continue to entrust public funds to agents, some avenues for improvement were proposed in order to ensure a better management of public funds. These avenues for improvement notably deal with the need to clarify the terms and conditions of use of funds entrusted, to implement adequate management tools and control mechanisms and to rigorously monitor the results obtained.
The following observations result from work related to this engagement. Among other things, sums from the Local Investment Fund were not used for the intended purposes. Mr. Samson observes that, between 2011 and 2013, 43 local development centres used sums from the Fund for expenses related to day-to-day administration. Thus, about $3 million per year was not available to help businesses.
On the other hand, the Fund's assets were not used optimally. In 2013, the investment rate for the assets for all local centres was 53%; therefore, $80.4 million in liquid assets were not invested in businesses. Furthermore, Fund loans were not always granted according to the terms and conditions of the centre's investment policy, the loan agreement and the management agreement.
The report also includes a chapter regarding modified opinions, emphasis of matter paragraphs and comments in the independent auditor's report (Chapter 3) and another chapter concerning the portrait of the reports to the National Assembly and of the reports to those charged with governance and management (Chapter 5).
The Highlights and the document presenting the work results in the form of a slideshow are available at www.vgq.qc.ca. The full report is only available in French.
Lucie Roy, Director
Cabinet, communications et affaires stratégiques
Auditor General of Québec
Tel.: 418 691-5915
SOURCE Vérificateur Général du Québec
For further information: Lucie Roy, Director, Cabinet, communications et affaires stratégiques, Auditor General of Québec, Tel.: 418 691-5915