Item - 2017.AU8.8

The Audit Committee recommends that:

1.  City Council receive the report (March 13, 2017) from the Auditor General, for information.

Jane Ying, Assistant Auditor General, and Niroshani Movchovitch, Senior Audit Manager, gave a presentation to the Audit Committee on this Item.

This report provides information on the Auditor General’s 2016 activities and financial and non-financial benefits. Specific responsibilities of the Auditor General are set out in Chapters 3 and 192 of the Toronto Municipal Code. The Code requires that the Auditor General report annually to Council on the activities of the Office and savings achieved.

In 2016, the Office issued a total of 32 reports including 14 performance audit reports, five Continuous Controls Monitoring reports, and 13 other reports. In addition, the Auditor General’s Fraud and Waste Hotline processed 552 complaints or 900 allegations in 2016.

The return on investment for the Auditor General’s Office is based on estimated cost savings and revenue increases as a result of previous and current audit reports and fraud investigations conducted by the Office. Since 2012, total one-time and projected five-year cost savings and revenue increases are approximately $160.5 million. The cumulative costs of operating the Auditor General’s Office since 2012 were approximately $21.7 million. In simple terms, for every $1 invested in the Auditor General’s Office the return on investment was approximately $7.4.

The identification of cost savings and increased revenue is only one component of the Auditor General’s mandate. Equally important is the ongoing evaluation of governance, risk management and internal controls. However, the benefits resulting from these audits are not easily quantified in financial terms.