Financial Management - Hearing Process - Audit Report - 2008
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Financial Management - Hearing Process - Audit Report - 2008

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Audit Report Financial Management – Hearing Process Audit Report Financial Management – Hearing Process Purpose and Scope of Audit Currently all costs of conducting hearings, other than staff costs, are managed by the Secretary’s Office. The Secretary is responsible and accountable for the budget in total with the Hearing Managers expected to provide a budget to the Secretary for their hearing. All other activities relating to the management of hearings are the responsibility of the Hearing Manager who usually resides in Applications. The audit consisted of four phases: a) Through interviewing Secretary’s Office staff determine the benefits to their management of financial matters and the benefits accruing to the Board. b) Through interviewing the Business Unit Leader, Applications, and selected Hearing Managers determine the satisfaction with the current process, any added-value improvements possible and any benefits or disadvantage to changing responsibility. c) Through interviews with some of the above staff and Regulatory Officers, gain an understanding of the budgeting process and the process for approving and spending of funds. d) Review financial analyses. Audit Summary • There is very little opportunity for Hearing Managers or the Secretary’s office to “control” the overall budget or individual budgets for hearings. • While certain assumptions can be made from ...

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Audit Report
Financial Management – Hearing Process
Audit Report
Financial Management – Hearing Process
Purpose and Scope of Audit
Currently all costs of conducting hearings, other than staff costs, are managed by the
Secretary’s Office.
The Secretary is responsible and accountable for the budget in total
with the Hearing Managers expected to provide a budget to the Secretary for their
hearing.
All other activities relating to the management of hearings are the responsibility
of the Hearing Manager who usually resides in Applications.
The audit consisted of four phases:
a)
Through interviewing Secretary’s Office staff determine the benefits to their
management of financial matters and the benefits accruing to the Board.
b)
Through interviewing the Business Unit Leader, Applications, and selected
Hearing Managers determine the satisfaction with the current process, any
added-value improvements possible and any benefits or disadvantage to
changing responsibility.
c)
Through interviews with some of the above staff and Regulatory Officers,
gain an understanding of the budgeting process and the process for approving
and spending of funds.
d)
Review financial analyses.
Audit Summary
There is very little opportunity for Hearing Managers or the Secretary’s office to
“control” the overall budget or individual budgets for hearings.
While certain assumptions can be made from available information at the
beginning of the year as to the number, location or duration of hearings, this can
all change with additions or deletions as the year progresses.
For budgeting purposes Regulatory Officers maintain information on standard
costs (airlines, hotels, hearing room costs, translators, reporters) which is provided
to Hearing Managers for input to budgets.
Costs of individual hearings and assumptions as to length of time and location can
also change depending on various dynamics.
Reviewed with the Secretary and Regulatory Administrator (Danielle Comte) the
process by which the overall budget for hearings is determined and the oversight
that is provided to costs incurred in individual hearings.
The Regulatory Administrator provided copies of the analysis she maintains and
explanations as to the process followed to record budgeted costs and the process
for approving and paying for actual costs incurred.
Actual costs are approved by the Secretary on the recommendation of the
Regulatory Officer, and are paid by the Regulatory Administrator.
Hearing
Managers are in agreement with this process.
An up to date spreadsheet is maintained by the Regulatory Administrator showing
both budgeted and actual costs by hearing although there is not a cumulative
comparison of budgeted to actual costs.
Good oversight over costs is maintained through the knowledge of the Regulatory
Officers and their review and approval of invoices.
Hearing Managers and the Applications Business Unit Leader do not have any
concern with the current process.
Hearing Managers, in consultation with the appropriate Team Leaders and the
Panel Chairs approve the participation of NEB staff on the project working group.
Staff costs are borne by that individual’s team.
Any overtime pay must be
approved by the individual’s Team Leader.
It was suggested by a Hearing Manager that a periodic summary comparing actual
and budgeted costs could be useful once significant costs start to be incurred on
their particular hearing.
Comparisons would be useful in identifying higher than expected costs to either
query costs (e.g., cost for a hearing room that was budgeted but not used) or as a
tools for budgeting costs on a future hearing.
Hearing Managers do not have a
significant oversight or approval role for individual costs incurred during the
hearing.
The
Hearing Manager Checklist
and the
Procedure for Resource Management for
Project Managers Pilot
were reviewed.
The Checklist is primarily a project management procedure, is current (updated
2008-07-11) and is a useful tool especially for less experienced Hearing
Managers.
The Pilot was a project undertaken by Ruth Mills with a working group and was
reviewed with the prior Chief operating Officer in early 2007.
While detailed,
there does not appear to have been any follow-up to integrate into the Checklist or
to otherwise establish as a separate procedure for posting on the Dashboard.
Also reviewed was a report from Graham Emmerson to Business Unit Leader,
Applications entitled
Role of the PMO in NEB Hearing Management
.
Although
outside the scope of this audit the report is useful in understanding the different
roles and responsibilities and is attached to this report for information.
Audit Results and Conclusions
There is very little opportunity for individual Hearing Managers and the Applications
Business Unit Leader to exercise control over the cost of individual hearings.
The
Secretary’s Office does have knowledge of the scope and amount of hearings likely to
occur in a given year and has knowledge of certain standard costs (interpreters, court
reporters).
The Regulatory Administrator has the tools to manage hearing budgets and
record actual costs.
The Regulatory Officers know actual costs as they are the ones who
are actually incurring the costs. Salaries and overtime costs of the project working group
are appropriately controlled with the oversight provided by the hearing manager, team
leader and panel chair.
Subject to the recommendations following, it is the conclusion of Internal Audit that
control over the overall Hearings Budget properly resides with the Secretary’s Office.
Recommendations
1)
To provide better oversight and to provide better information for Hearing
Managers, it is recommended that periodic (no less than monthly) analyses should
be provided by the Regulatory Administrator to the Hearing Manager comparing
budgeted costs to actual costs by budget category.
2)
Currently, information provided by the Hearing Manager to the Secretary’s
Office and others is sporadic at best.
Changes to the number of people travelling,
estimated duration of the hearing, and the need for consultants can impact the need
for funds to complete the hearing.
To provide for a regular dialogue it is
recommended that at least a monthly update on changes and estimated changes be
provided to the Secretary’s Office, the Panel Chair, the Business Unit Leader and
the Team Leader
3)
In the current process the Regulatory Officer recommends invoices for
approval and payment by the Secretary.
It is recommended that invoices for costs
in excess of a minimum level and any costs that exceed budget by more than an
agreed percentage be forwarded to the Hearing Manager who will provide
justification and for the overrun and recommend approval and payment by the
Regulatory Officer and the Secretary.
4)
The
Hearing Manager Checklist
and the
Procedure for Resource Management
for Project Managers Pilot
should be reviewed by responsible parties (the
Secretary’s Office, the Application BU leaders and Hearing Managers) and to the
extent they believe the Pilot is useful, either integrate the Pilot with the Checklist or
establish a separate procedure.