Taking Stock: SAI activities in supporting policy formulation

62 – 2 – SUPREME AUDIT INSTITUTIONS’ INPUT INTO POLICY FORMULATION

6/10

Of peer SAIs looked at: The flexibility of the rulemaking and internal control systems to adapt to risks and future trends.

6/10

Of peer SAIs looked at: The clarity and delineation of roles and responsibilities of actors involved in creating and implementing regulations and internal controls.

9/10

Of peer SAIs looked at: Processes for the development of internal control guidelines, including: the incorporation of risk management, the openness and consultation of the process, and the alignment with international principles.

Examples of SAI work in this area include:  Canada’s OAG has undertaken a series of audits on financial management and control and risk management. In 2003, OAG’s Integrated Risk Management audit (OAG, 2003) showed that much remained to be done regarding integrating the risk-management mechanisms of departments. Progress had been made by the 2006 status report, Managing Government: Financial Information, but the OAG recommended improving financial controls to ensure that decisions were based on reliable information (OAG, 2006). The 2011 status report tracked progress against previous recommendations in seven large federal departments, and considered whether the Treasury Board Secretariat (TBS) (a CoG institution) had evolved in leading and developing strengthened financial and risk management portfolios in these departments. The report found that the institutions had made satisfactory progress, and that the TBS had demonstrated leadership through innovation.

However, there was still room for the TBS to adopt a stronger leadership position to guide departments further (OAG, 2011).  As part of a series on the sustainability of public finances following the crisis in 2008, the Netherland’s Court of Audit began promoting the importance of accurate risk assessments to parliament. The Court repeatedly tried to put this topic on the political agenda, in one activity it developed factsheets to summarise the risks involved with Netherland’s ties with eight financial institutions. The

Court mapped these sources of risk, and their potential effects, in a way that was easy for parliament to understand. It also encouraged the Minister of Finance to think thoroughly about what and how information is presented and the implications for decisions made. More information about this audit is provided in

Box 3.3.

 GAO’s (2013b) report, Hurricane Sandy Relief: Improved Guidance on

Designing Internal Control Plans Could Enhance Oversight of Disaster Funding, examined the Hurricane Sandy disaster relief internal control plans made in response to the 2013 Disaster Relief Appropriations Act in accordance with the

Office of Management and Budget (OMB) guidance. It concluded that the OMB’s guidance was not sufficiently robust and, consequently, was not consistently used by agencies when preparing their internal control plans.

SUPREME AUDIT INSTITUTIONS AND GOOD GOVERNANCE: OVERSIGHT, INSIGHT AND FORESIGHT © OECD 2016