New Circumstances - New Plan

Adapting the Audit Plan to the New Reality

The Initial Plan: Leveraged our traditional risk based 3 year rotating approach

• We had embarked on our normal risk based planning approach prior to the declaration of the pandemic. Needless to say the current environment has changed everyone's perspective. We are now living in a world where a planned for risk, pandemic, is in play. As a result, other risks have changed in severity and new risks, or nuances, are emerging.
• As a result this proposed Covid-19 audit plan is being presented for consideration and the initially planned projects deferred for later consideration. These projects were going to be: ○ A value for money/performance audit related to accounts payable ○ Quality and compliance process and control in effect at Huron Lodge
• Details of these projects are included in Appendix A.

Required Adaptation: New, emerging and changing risks required plan adaptation and leveraged consultation with peers

• The remainder of this plan outlines our proposed projects in this new environment and changing risk landscape. We have identified the proposed plan with details of the expected work and reports/deliverables.
• Prior to recommending the following Audit Plan, the Auditor General held discussions with City Leadership and participated in several national and international roundtables of Audit Executives. There is a definite trend in the current environment for the Audit roles to assist management with real-time response to emerging and changing risks as opposed to the traditional retrospective audit approaches. This is a permitted approach under professional standards but may require a period of "cooling-off" for the audit function for 12-18 months for the specific areas considered.

Reporting Modifications: Adapted approaches need adapted reporting structures

• Given the advisory nature for the first 3 projects, these reports will differ from traditional audit reports. Given the realtime consultation with management to get in front of the changing risk landscape our reports will summarize the key areas where we provide input to management and highlight the considerations we raised. No formal testing or findings/recommendations are expected to be issued.
• The remaining projects will provide the normal outputs/reports generated.

Limitation: Risk considerations recommended for consideration exceed available resources

• By approving this plan, or modified plan, the City is acknowledging that the Auditor General and Internal Audit will be covering a small portion of the legacy and emerging risk landscape.
• In Appendix B we have also included what we see as changing risks and the areas that we would lideally recommend to cover that do not fit within the current budget and available resources.