Thank you

Figure 2: Government of the Northwest Territories performance on 12 international best practices of fiscal transparency

There are three categories - the dimension, the principle, and the rating of the government practices.

1. Coverage of Institutions. Fiscal reports cover all entities engaged in public activity according to international standards. We got an "advanced" for that.
2. Coverage of stocks. Fiscal reports include a balance sheet of public assets, liabilities, and net worth. Advanced.
3. Coverage of flows. Fiscal reports cover all public revenues, expenditures, and financing. We got advanced for that.
4. Statistical integrity. Fiscal statistics are compiled and disseminated in accordance with international standards. Advanced.
5. External audit. Annual financial statements are subject to published audit by an independent supreme audit institution which validates their reliability. Advanced.
6. Timeliness of annual financial reports. Audited or final annual financial reports are published in a timely manner. We got a "good" for that.
7. Internal consistency. Fiscal reports are internally consistent and include reconciliations between alternative measures of summary fiscal aggregates. We got "good" for that.
8. Classification. Fiscal reports classify information in ways that make clear the use of public resources and facility international comparisons. We got a "basic" for that.
9. Comparability of fiscal data. Fiscal forecasts, budgets, and fiscal reports are presented on a comparable basis with any diversifications explained. Basic.
10. Coverage of tax expenditures. The government regularly discloses and manages revenue loss from tax expenditures. Less than basic.
11. Frequency of in-year reporting. In-year fiscal reports are published on a frequent and regular basis. Less than basic.
12. Historical revisions. Major revisions to historical fiscal statistics are disclosed and explained. Unclear.

Committee believes the GNWT should and can meet the highest standards of transparency. To that effect, committee is advancing recommendations to improve in three areas:.

1. The timeliness of annual financial statements;
2. The frequency of in-year reporting; and
3. The comparability of fiscal data.

Committee recognizes that our recommended improvements will take place. The improvements imply significant administrative, technological, policy, and even legislative work. The most significant challenge may be to develop the internal government collaboration needed to produce greater external transparency. With these factors in mind, committee is seeking the GNWT's commitment to take steps, with timelines, towards reaching the highest standards of fiscal transparency.

Timeliness of annual financial statements

Timeliness refers to the time lag between the end of the fiscal year - March 31st - and when the public accounts are published. Timely publication is critical to ensure that past fiscal performance can inform future budgets. It also ensures that any irregularities identified by auditors can be addressed quickly. Several international organizations, such as the IMF, recommend releasing the public accounts within six months of the fiscal year-end. The GNWT does not meet this standard. Legislation only requires the GNWT to complete the public accounts within nine months. Over the past five years, the GNWT has released the public accounts seven to nine months after fiscal year-end.

Figure 3: Release date of the public accounts since 2017

• The years for 2017 for the public account year, release month was November 2017, which was eight months.
• For 2018, it was released on October 2018, which is seven months.
• 2019, December 2019 was nine months.
• 2020, December 2020, it was nine months.
• 2021 was released on November 2021, which was eight months.

While the Comptroller General is required to produce an interim financial report within six months of fiscal year-end, this practice falls short of the international best practice. The interim financial report is non-consolidated, unaudited, and generally not available to the public. Committee believes a timelier release of the public accounts is achievable. Yukon's Department of Finance, for example, is working with consolidated entities and the OAG to move up the release of the Public Accounts. Committee therefore recommends:

Recommendation 6

That the Department of Finance amend the Financial Administration Act, section 35, to move the required release date of the public accounts by three months, from December 31 to September 30.

I will now turn the next item over to MLA Johnson from Yellowknife North.