Thank you, Mr. Speaker. Thank you, Mr. Nadli.
Timeliness of the Public Accounts
The Financial Administration Act Section 74 states that, “unless the Legislative Assembly otherwise fixes a date, the public accounts for the fiscal year must be laid before the Legislative Assembly on or before December 31st following the end of the fiscal
year or, if the Legislative Assembly is not then in session, not later than 15 days after the commencement of the next session of the Legislative Assembly.”
The present committee reviewed the practice of previous governments and Legislative Assembly committees with regard to the public accounts, going back to 1987. Members found that external factors, most commonly changes in national public
sector accounting standards, have made timely submission and review of the public accounts a challenge, in spite of repeated committee requests, government commitments and statutory requirements.
Prior to division of the Northwest Territories, the public accounts were sometimes submitted as late as 15 months after the end of the fiscal year. Post-division, in 2001, the committee tasked with reviewing the public accounts requested that the deadline be moved up to August 31st , to permit
examination of the public accounts before business plans. For a time, the government was able to comply with this request.
However, the GNWT bases its accounting standards on recommendations of the Public Sector Accounting Board (PSAB). The PSAB changed their guidelines so that, as of April 1, 2005, a government's “reporting entity” included all the entities that are controlled by the government. This change meant that, for the first time, the 2005-2006 Public Accounts of the Northwest Territories had to be consolidated to include boards and agencies as well as departments.
The Office of the Comptroller General in the Department of Finance is responsible for overseeing the preparation of the public accounts. In accordance with the federal Northwest Territories Act, Section 30(1), the Auditor General of Canada audits the accounts and financial transactions of the Government of the Northwest Territories. The Office of the Auditor General also audits some of the larger agencies consolidated in the public accounts: the NWT Housing Corporation; the NWT Hydro Corporation including its subsidiary, the NWT Power Corporation; the NWT Business Development and Investment Corporation; and Aurora College. Components of these entities must also be audited, though not by the Auditor General of Canada, including health and social services authorities, education councils, and local housing associations.
The requirement for consolidation had a major impact on the government’s ability to submit the public accounts in a timely manner.
The final public accounts section one now contains a consolidation of the financial statements of 22 public agencies. The financial statements of three of these 22 are a further consolidation of 29 organizations. Many of these organizations have statutory reporting requirements that require their audited financial statements to be completed between July 1st and August 31st of each year,
rather than by the March 31st government fiscal year end. Accounting standards and classifications differ for some of these bodies. It is not unusual, moreover, for some organizations to complete their audits past these deadlines.
The 2006-07 Public Accounts were signed off by the standing committee’s preferred August 31st deadline, but at that time the government was still allowed to use draft financial statements from boards and agencies in the consolidation. After that year, completed audits were required for all the entities included in the consolidation. The 2007-08 Public Accounts were not signed off until December 5, 2008, and the 2008-09 document not until December 7, 2009. The final audited public accounts for these years were tabled early in the February sitting of the Assembly, in accordance with the statutory deadline, but far from the earlier standing committee deadline of August 31st .
Then, the 2009-10 Public Accounts were tabled more than a year after the end of the fiscal year to which they applied, on May 10, 2011. Implementation of the government’s new financial software, the SAM system, contributed to the very late submission; as well, the NWT Housing Corporation audit was not complete until May 2011. Timeliness improved somewhat the following year, with the 2010-11 Public Accounts signed off on February 13, 2012, with tabling only a few days later, on February 16, 2012.
This year’s sign-off date of November 30, 2012, for the 2011-12 Public Accounts represents commendable improvement, with a consistent effort to get audits completed earlier and reduce the number of errors that cause delays. The final public accounts for 2011-12 were tabled in February 18, 2013. The Standing Committee on Government Operations is pleased with the Comptroller General’s renewed efforts to table the public accounts in accordance with the statutory deadline, and acknowledges receipt of an embargoed copy of the public accounts before tabling.
However, Rule 85 (3) (d) (i) of the Legislative Assembly provides that, “In the event that the Assembly is not in session, the Speaker may provide the Auditor General’s report and the Minister of Finance may provide the public accounts to the committee for review, which may include public hearings, in advance of tabling.”
While the Standing Committee on Government Operations would prefer to return to the 14th Assembly’s pre-business plans deadline for the public accounts, members recognize that an August deadline for the final document may not be practically achievable. As a step in the right direction, the committee would like to receive the final public accounts on sign-off, prior to tabling, with the option of conducting a public review as permitted under the rules. This would permit committee review and reporting to be completed within one year of the fiscal year dealt with in the public accounts.
Further, the Comptroller General indicated during the review that the government may be able to
provide the interim public accounts before September 30. The committee considers that it would be useful to have this document prior to the annual review of departmental business plans.