That is the message out of the National Forum for Government Chief Internal Auditors, the third annual meeting of the heads of internal audit of Canada's two senior levels of government, held October 20-21, 2005 in Quebec City.

The forum, Internal Auditing - Thought Leadership and Emerging Practices in Support of Governance and Accountability, was hosted by Mishèle Bérubé, Directrice exécutive, Comité des responsables de la vérification interne, of the Government of Quebec. It was co-chaired by Jacques Lapointe, then Chief Internal Auditor and Assistant Deputy Minister, Government of Ontario (recently named Auditor General of Nova Scotia effective March 1, 2006), and CCAF Executive Director Michael Eastman.

Evidence of the growing maturity of this annual event was found in:

• the creation by the group of the Government Internal Auditors Council of Canada;
• the strengthening of internal audit in the federal government, announced coincidentally at the time of the forum;
• the steps taken by the Institute of Internal Auditors (IIA) to support public sector internal audit, both internationally and in Canada; and
• a proposal for Canada to lead the development of an Internal Audit Capability Maturity Model for public sector organizations worldwide.

These and other developments are discussed in this report on the Quebec City forum.

Roundtable

A representative of every provincial and territorial government attended the forum, with the exception of Prince Edward Island, which does not have an internal audit function.

In a roundtable session, the participants reviewed developments in each jurisdiction. Key points raised included the following:

Release of audit reports: There is no consistency across provincial/territorial governments regarding the posting of internal audits on the Internet, a practice currently in effect at the federal level. Authorities in several jurisdictions are currently considering whether to make internal audit findings public.

Evolution of the internal audit function: A number of jurisdictions are strengthening the function through such measures as the publication of audit manuals, the creation of Audit Policies or Charters, and/or the addition of external representatives to Audit Committees.

Services provided: With resources stretched, internal audit shops are looking carefully at the services they provide.

Internal Auditing Governance and Infrastructure (Alberta)

Guest speaker Ken Hoffman, Assistant Auditor General of Alberta, presented the results of recent work by Alberta's Auditor General regarding:

• Recruiting, evaluating and training board members;
• Assessment of audit committees;
• Internal audit in the government of Alberta.

• The Alberta government should update governance principles and guidance for Alberta boards
• Boards should publicly report their performance against the principles.

In 2003, Alberta's Auditor General called for improvements in public sector audit committees. Ken noted that the government has accepted the Auditor General's recommendation that it provide guidance to committees and issued Proposed Guidance for Audit Committees of the Government of Alberta Agencies, Boards and Commissions. CCAF has published a version of the document for a broader audience.

The final initiative examined all internal audit departments in the Government of Alberta. CCAF will soon publish an Update interview with Ken Hoffman about the results of this interesting project.

Audit of the Procurement and Contract Management Process (Quebec)

Mishèle Bérubé reported on a challenging audit supported by the Quebec government's Comité des responsible de la vérification interne (CRVI).

Quebec's Treasury Board asked five agencies for internal audits of the processes of acquiring and managing contracts in 2003-2004. The agencies worked together to respond to the request, supported by the CRVI. This coherent approach produced good results and led the Treasury Board to ask 19 other government agencies to report on contract management for the following year, using a similar approach.

Forum participants discussed factors affecting the auditing of contract management, including the limited number of vendors in small jurisdictions, and the risk that media sensationalism of minor problems could lead governments to introduce unneeded rules. They also noted the potential value of the Quebec approach to auditing other government-wide issues, such as the awarding of grants and contributions.

Performance Measures for Internal Auditing

Bob Shahi, Director of the Audit Bureau of the Northwest Territories, led a discussion on the development and use of performance measures for internal auditing, and tabled some suggested performance measures (see presesntation Performance Measures for Internal Auditing).

The group subsequently agreed that Bob would chair an Advisory Committee on Performance Measures, with support from Stephen Thompson, Director, Audit and Consulting Services, Office of the Comptroller of New Brunswick; Pamela Muir, Director, Corporate Internal Audit, Nova Scotia Department of Finance; and the CCAF.

To help advance this initiative, CCAF will soon publish an Update interview with Bob about performance measures.

What's New: News from The IIA

Guest speaker Brenda Lovell, Vice-President, Knowledge Management of The Institute of Internal Auditors (IIA), informed the forum participants about developments at the institute (see presentation What's New at The IIA). She was followed by Brian Brown of Agricore Canada, the Canadian representative on the IIA Global Board of Directors, who spoke about IIA developments in Canada.

Brenda described the three primary directives of the IIA's 2005-2008 Strategic Plan:

• Advocacy: to be the recognized voice for the internal audit profession
• Globalization: to develop and sustain the internal audit profession globally through appropriate infrastructure, coordination and communication, and
• Service: to provide exceptional service to IIA members.

She also noted that the IIA is developing an initiative to support internal audit in governments through such measures as professional guidance, professional qualifications, quality and control measures, advocacy and member services.

Brian said IIA leaders in Canada have established three task forces, to consider the feasibility and desirability of creating a Council of Canadian Chapters of IIA; to review options for a different Canadian structure for IIA participation; and to develop a Canadian advocacy plan.

What's New from Ottawa: Internal Auditing and the Federal Government

The second day of the forum coincided with the announcement in Ottawa of the new Government of Canada Internal Audit Policy. As a result of the announcement, Basia Ruta, Assistant Comptroller General, Internal Audit in the federal Treasury Board Secretariat, was unable to attend the forum.

In her absence, the new policy was outlined by Fred Jaakson, Executive Director of Systems, Forensic and Horizontal Audits in the Treasury Board Secretariat. Following his presentation, the forum participants discussed the new policy in detail.

The Audit Role in Public Sector Governance

This agenda item was led by Jacques Lapointe, then Chief Internal Auditor and Assistant Deputy Minister, Ontario Internal Audit, Government of Ontario.

Jacques also shared with forum participants two documents prepared by his office: a Program Logic Model, which describes the role of internal audit in Ontario; and a presentation the office uses to prepare its government clients for audits by the Ontario Auditor General Preparing Clients for the External Auditor.

October 21, 2005 was an important day for the heads of internal audit of Canada's senior governments. That is the day they officially created the Government Internal Auditors Council of Canada (GIACC) to formalize what had been until then ad hoc arrangements for meeting and working together.

According to the terms of reference for the new organization, which were approved unanimously by forum participants on October 21, GIACC “is dedicated to the ongoing strengthening of internal auditing in the provincial and territorial governments of Canada and the strengthening of linkages between the provincial/territorial and federal internal audit organizations.” It was agreed that the terms of reference would be reviewed every two years.

The Council's creation marks an important milestone in the maturity of the internal audit function in the public sector in Canada.

Other Matters

The participants agreed to accept Nova Scotia's offer to host the next meeting in Halifax in October 2006.

They also noted the imminent retirement of CCAF's Senior Research Associate Libby MacRae. They thanked Libby for her critical role in bringing the group together, and wished her well in the future.

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