In 1997-1998, we recommended (1998—No. 38) the former Ministry of Public Works, Supply and Services improve its reporting of performance measures to better demonstrate its cost-effectiveness.
The Ministry’s business has changed
In 1997-1998, the former Ministry was a central agency and its outputs were primarily inputs to other ministries. We considered it important for the Ministry to demonstrate its cost effectiveness. In May 1999 the Ministry merged with Ministry of Transportation and Utilities to form the Ministry of Infrastructure. The Ministry of Infrastructure took over significant additional responsibilities from other ministries and some of the central agency functions were transferred to other ministries. The business of the Ministry of Infrastructure is not the same as that of the Ministry of Public Works, Supply and Services. Accordingly, our recommendation is not completely relevant to the Ministry of Infrastructure. To the extent our recommendation is relevant, the Ministry has taken steps to implement it.
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Ministry Audits and Recommendations Infrastructure
In its 2001-2004 business plan, the Ministry indicates that as part of its goal to increase the effectiveness and efficiency of central services it will report on the following measures:
• Energy consumption in facilities the Ministry owns and operates.
• Operating cost of office buildings the Ministry owns and operates. The Ministry will compare the average operating cost per square meter of its office buildings to the Alberta industry standard.
The Ministry implemented our recommendation
In addition, the Ministry will report on the measures relating to the physical condition, utilization and functional adequacy of the buildings it owns and operates. These measures will show how effectively the Ministry has maintained and used these buildings.
Reporting such measures in an integrated results analysis will provide information relating to quality and cost-effectiveness at a high level suitable for public performance reporting. Accordingly, we consider the Ministry has implemented our recommendation.
Ministry financial statements
Reservation of opinion We audited the financial statements of the Ministry of Infrastructure as at and for the year ended March 31, 2001. The auditor’s report contained a reservation of opinion.
The Ministry should estimate the cost and record the liability for site restoration
In accordance with corporate government accounting policies, the Ministry reports the costs of site restoration in the period in which the restoration work is performed rather than in the periods in which the liabilities arose. In my view, the Ministry should estimate the cost and record the liability for sites that do not meet the
required contractual or environmental standards. The estimate of the liability should be refined each year, as the extent of required restoration work becomes clearer. I believe that the effect of this departure from Canadian generally accepted accounting principles is significant; therefore, I reserved my opinion.
Auditor General of Alberta 166 2000-2001 Annual Report
2000-2001 Annual Report 167 Auditor General of Alberta
Ministry Audits and Recommendations Innovation and Science
Innovation and Science
Overview
The mission of the Ministry of Innovation and Science is to enhance the contribution of science, research, and information and communications technology to the sustainable prosperity and quality of life of all Albertans. The Ministry has two core businesses:
• Science, Research and Development ($145 million)
• Government Information Technology ($63 million)
Total operating expenses for the Ministry of Innovation and Science for 2000-2001 were $213.4 million and of this amount,
$72.6 million was for grant funding. The increase in grant funding is mainly attributed to the increased spending by ICORE Inc. in its first full year of operations for information and communications technology research. In addition, the Alberta Heritage Foundation for Medical Research, which is an organization accountable to the Minister, had expenses of $52.8 million that are not reflected in the Ministry’s expenses.
During the year, the Alberta Heritage Foundation for Science and Engineering Research commenced operations. The Foundation was created with an initial endowment of $500 million. The objectives of the Foundation are to:
• stimulate science and engineering
• promote effective means of using science and engineering resources available in Alberta
• support science and engineering research laboratories and related facilities in Alberta
• promote co-operation in Alberta science and engineering research to minimize duplication and promote concentration of effort
• encourage young Albertans to pursue research careers in science and engineering
Summary of audit results
The Foundation’s legislation states that the Provincial Treasurer shall not pay money out of the Endowment Fund if the payment would impair the real value of the Endowment Fund over the long
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Ministry Audits and Recommendations Innovation and Science
term. In this section, we recommend that the Foundation request clarification of the meaning of “real value over the long term” to avoid misinterpretation and permit monitoring the Foundation’s compliance with its legislation.
For the Ministry to be successful, it needs to fully understand all government-funded science, research and development. This year, we examined the Ministry’s system to review government science, research and development at the Alberta Science and Research Authority (ASRA). We recommend ASRA improve the system used to conduct the review.
In 1999-2000, we recommended that the Ministry, with the cooperation of other Ministries, develop systems to assist in the management of government-wide information technology (IT) services and infrastructure. The Ministry drafted a framework that defined the roles and responsibilities of the key stakeholders and a process to develop a government wide information technology management (ITM) plan. The framework is pending the approval of the Deputy Minister’s council. Since the framework has not been approved, we are repeating the recommendation that the Ministry develop systems to assist in the management of government-wide information technology (IT) services and infrastructure.
We re-examined controls in IMAGIS, which is the main system that the ministries rely on to process financial transactions and to produce financial statements. Without adequate controls in this system, there is a risk that financial transactions and accounting records may not be correct. Last year, we recommended that the Ministry obtain an appropriate level of assurance that information technology providers are maintaining effective controls to protect the confidentiality and integrity of IMAGIS data. As we note in this Report, there has been some progress, and management is moving towards obtaining the necessary assurance in future years.
In 2000-2001, we commenced a review of the Ministry’s systems development methodology. Two systems that had been developed and implemented during the year, ExClaim and Electronic Payment System, were examined. A formal systems development
methodology does not exist. Our finding and the resulting recommendation are included in this section.
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Ministry Audits and Recommendations Innovation and Science
Scope of work
In addition to the audit of the Ministry’s financial statements, my staff completed the following work:
• a follow-up of the Ministry’s progress in developing systems to manage government wide information technology (IT) services and infrastructure
• an examination of the ASRA’s system to review government science, research and development
• an examination of the controls over the IMAGIS system
• an examination of the Ministry’s systems development
methodology, and an evaluation of the process followed in the development and implementation of the ExClaim and the Electronic Payment System
• specified audit procedures on the Ministry’s key performance measures reported in its annual report for the year ended March 31, 2001
Information technology
Recommendation No. 26 Management of information technology
We again recommend that the Ministry of Innovation and Science, with the cooperation of other Ministries, develop systems to assist in the management of government-wide information technology (IT) services and infrastructure.
The Ministry is responsible for the effective use of cross government information technology
In the 1999-2000 annual report (2000—page 193), we made the same recommendation. We noted the Ministry is responsible for coordinating the effective use of the government’s computer
technology, networks, and information systems and for establishing cross-government policies and standards for information and communications technology.
The Ministry drafted an accountability framework that is pending the approval of the Deputy Minister’s Council.
Last year the Ministry accepted the recommendation and indicated an accountability framework would be developed with the
participation of all Ministries and other important stakeholders.
During the year, the Ministry drafted an accountability framework, however, it has not been implemented as it is pending finalization by the Ministry and subsequent approval of the Deputy Ministers’
Council. The framework defines the roles, responsibilities, expectations and requirements for stakeholders such as the Chief Information Officer, the Alberta Corporate Service Centre and
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Ministry Audits and Recommendations Innovation and Science
individual ministries and includes definitions for the deliverables, timing and proposed outcomes for each key stakeholder. The framework also outlines a process to develop a government wide information technology management (ITM) plan and a dispute resolution process. The Ministry also drafted a communications strategy and action plan to assist in the implementation of the framework.
A framework needs to be implemented
We believe progress was satisfactory until the initiative was
delayed. We encourage the Ministry to implement the framework. It is important that an ITM plan, which sets out government-wide goals and strategies and identifies those responsible for the achievement of the goals, be prepared and approved. A system must also be implemented to monitor progress towards goals and ensure that those responsible for the achievement of the goals are accountable.