The Auditor General reviews the implementation status of recommendations made through her audit and investigation reports. The results of the review are reported to City Council through the Audit Committee.
Our Office implemented a new audit management technology solution. As an extension of the new system, we integrated continuous tracking of the implementation status of the recommendations in 2020.
As of June 1, 2021, City Divisions have reported 163 recommendations have been fully implemented and action continues on another 349 recommendations. There are also another 176 open recommendations from reports issued to Agencies and Corporations as well as 61 open recommendations from investigations and Fraud and Waste Hotline reports.
The current status of open recommendations, as reported by management, is summarized in Table 1.
Table 1 – Current Status of Open Recommendations Issued Between September 2005 and October 2020
1 The Auditor General also made 37 recommendations in separate management letters for less significant issues identified during audits to City divisions and Agencies and Corporations. The follow-up results are reported to the City Manager or the Head of the respective Agency and Corporation.
2 The Auditor General’s system is updated on a continuous basis by management. Recommendations reported as fully implemented after June 1, 2021 are still included in this column.
Of the 516 audit recommendations issued to City divisions, 236 are considered high priority recommendations where a significant potential for savings, or health and safety risks, or risks to the City’s reputation are involved. In addition, recommendations that have remained outstanding for over five years are also considered high priority.
Given the large number of recommendations reported by management as fully implemented, we focused on verifying the status of high priority recommendations, followed by other recommendations management reported as fully implemented at the beginning of January 2021.
This report includes the results of our follow-up of 115 audit recommendations from reports issued to City divisions that management reported as fully implemented. Of the 115 recommendations, we verified that 74 (64 per cent) were fully implemented and one (1 per cent) was not applicable. However, we determined that 40 (35 per cent) were not fully implemented because the steps undertaken or the extent of the improvement did not fully address the issue or the intent of the recommendation, or management was unable to provide sufficient evidence of actions taken.
It is important that management adequately review actions taken to implement a recommendation before asserting a recommendation has been fully implemented. If actions taken are not sufficient to address the intent of recommendations, or there is insufficient evidence to confirm the recommendation has been implemented, reporting a recommendation as fully implemented may be providing false assurance that identified risks have been appropriately addressed and the Auditor General’s limited resources are wasted when the implementation of the recommendation needs to be re-audited a second time.
Table 2 below summarizes the results of our Office’s follow-up validation of those recommendations management reported as fully implemented.
Table 2 – Results of the Auditor General’s Review of the Recommendations Management has Reported as Fully Implemented
The fully implemented (FI) recommendations the Auditor General’s Office has validated are included in Attachment 1.
The no longer relevant (NA) recommendation the Auditor General’s Office has validated is included in Attachment 2.
The high priority recommendations that have not yet been fully implemented (NFI) as at June 1, 2021, together with management comments on progress, action plans and implementation due dates are included in Attachment 3.
Management also reported recommendations as fully implemented or no longer applicable. We are in the process of validating that the recommendations are fully implemented. Management’s actions to address these recommendations are described in Attachment 4.
The status of fraud and waste investigation recommendations is included as an attachment. Recommendations from fraud and waste investigation reports that have been reported by management as fully implemented were not included in the scope of our current follow-up review. We will be undertaking work to validate management’s assertions in the near future. Management’s actions to address these recommendations are included in Attachment 6.
All confidential recommendations are included in Confidential Attachment 1.
*Reason for Confidential Information:
The attachment to this report involves the security of the property of the City or local boards.
The attachment to this report involves labour relations or employee negotiations.
The attachment to this report involves litigation or potential litigation affecting the City or a local board.
The attachment discusses a position, plan, procedure, criteria or instruction to be applied to any negotiations carried on or to be carried on by or on behalf of the City or local board.