| Examples of opinions we form on departments, Crown agencies
and Crown-controlled corporations
Our mission states "We encourage accountability and effective management in
government operations". We do this by examining and reporting on:
- the reliability of financial information;
- compliance with authorities;
- the adequacy of management systems and practices related to financial reporting,
compliance with authorities and safeguarding assets; and
- the adequacy of management systems and practices related to due regard to economy,
efficiency and effectiveness.
Our examinations and reports focus on the Government as a whole, sectors or programs of
government, and individual government organizations. This Appendix contains examples of
the audit opinions we form to provide our assurances on financial statements, compliance
with authorities, and management practices in this Report. We use the auditing standards
recommended by the Canadian Institute of Chartered Accountants for the public sector to
form our opinions.
Provincial Auditor Saskatchewan
1996 Fall Report
V - 1
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1. Following is an example of the opinion we form on the adequacy of the
control systems used by an agency to safeguard and control public money.
| I have examined the system of internal control of [Crown Agency X] in effect as at
[date]. I did not examine certain aspects of internal control concerning the
effectiveness, economy, and efficiency of certain management decision making processes.
The criteria for the examination of this system of internal control consisted of the
control environment and control systems described in the Canadian Institute of Chartered
Accountants Handbook. My examination was conducted in accordance with generally
accepted auditing standards. Those standards require that I plan and perform an
examination to obtain reasonable assurance whether the system of internal control
established and maintained by management is sufficient to meet the control objectives
referred to below. Such an examination includes obtaining an understanding of the system
of internal control and performing tests of controls to determine whether the internal
controls exist and operate effectively.
The management of [Crown Agency X] is responsible for establishing and maintaining a
system of internal control to achieve the control objectives noted in (a) to (d) below. In
fulfilling this responsibility, estimates and judgement by management are required to
assess the expected benefits and related costs of control procedures. Pursuant to my
responsibilities under Section 11(1) of The Provincial Auditor Act, I am required
to determine that there is a system of internal control in effect which provides
management with reasonable, but not absolute, assurance that:
a) the accounts are faithfully and properly kept to permit the preparation of financial
statements in accordance with the appropriate basis of accounting;
b) all public money is fully accounted for and properly disposed of and the rules and
procedures applied are sufficient to ensure an effective check on the assessment,
collection and proper allocation of public money;
c) transactions are executed in accordance with management's authorization, public
money expended is applied to the purpose for which it was appropriated by the Legislature
and the expenditures have adequate statutory authority; and
d) essential records are maintained and the rules and procedures applied are sufficient
to safeguard and control public money against loss from unauthorized use or disposition.
Because of the inherent limitations in any system of internal control, errors or fraud
may occur and not be detected. Also, projection of any evaluation of the system of
internal control to future periods is subject to the risk that procedures may become
inadequate because of changes in conditions, or that the degree of compliance with the
procedures may deteriorate.
In my opinion, based upon the above criteria, the system of internal control of [Crown
Agency X] in effect as at [date], taken as a whole, was sufficient to meet the objectives
stated above insofar as those objectives pertain to the prevention or detection of errors
or fraud in amounts that would be material in relation to [Crown Agency X].
Or if the examination disclosed conditions that, individually or in combination
result in one or more material weaknesses, the opinion paragraph should be modified as
follows:
My examination disclosed the following conditions in the system of internal control of
[Crown Agency X] as at [date] which in my opinion, based upon the above criteria, resulted
in more than a relatively low risk that errors or fraud in amounts that would be material
in relation to [Crown Agency X] may occur and not be detected within a timely period.
The report should go on to describe all material weaknesses, state whether they
resulted from the absence of control procedures or the degree of compliance with them, and
describe the general nature of the potential errors or fraud that may occur as a result of
the weaknesses.
City
| Date |
Chartered Accountant |
|
Provincial Auditor Saskatchewan
1996 Fall Report
V - 2
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2. Following is an example of the opinion we form on an agency's compliance
with the law regarding its spending, revenue raising, borrowing and lending activities.
I have made an examination to determine whether [Crown Agency X] complied with the
provisions of the following legislative and related authorities pertaining to its
financial reporting, safeguarding assets, spending, revenue raising, borrowing and
investing activities during the year ended [date]:
(List legislative and related authorities covered by this report. This list must
include all governing authorities.)
My examination was made in accordance with generally accepted auditing standards, and
accordingly included such tests and other procedures as I considered necessary in the
circumstances.
In my opinion, [Crown Agency X] has complied, in all significant respects, with the
provisions of the aforementioned legislative and related authorities during the year ended
[date].
(The report should provide adequate explanation with respect to any reservation
contained in the opinion together with, if relevant and practicable, the monetary effect.)
City
| Date |
Chartered Accountant |
|
3. Following is an example of the opinion we form on the financial statements
prepared by management of an agency.
| I have audited the balance sheet of [Crown Agency X] as at [date] and the statements
of income, retained earnings and changes in financial position for the year then ended.
The [Crown Agency X]'s management is responsible for preparing these financial statements
for Treasury Board's approval. My responsibility is to express an opinion on these
financial statements based on my audit. I conducted my audit in accordance with
generally accepted auditing standards. Those standards require that I plan and perform an
audit to obtain reasonable assurance whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.
In my opinion, these financial statements present fairly, in all material respects, the
financial position of the [Crown Agency X] as at [date] and the results of its operations
and the changes in its financial position for the year then ended in accordance with
generally accepted accounting principles.
City
| Date |
Chartered Accountant |
|
Provincial Auditor Saskatchewan
1996 Fall Report
V - 3
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