Canadian Government Executive - Volume 22

/ Canadian Government Executive

// September 2016

Strategy

There is a clear opportunity for internal

audit to formally invest in cross-cutting

data management communities of practice.

vided faster insight into performance and

focused specialized resources on higher

risk providers and mitigations. It also al-

lowed for targeted, high impact and cost

effective monitoring and interventions.

Audit, with its advanced knowledge of

data analytics, can provide further assur-

ance of control and decision making integ-

rity within the governance model.

The above processes resulted in mitigat-

ed risk, conserved resources and limited

intrusion to those service providers who

do not merit regular in-depth compliance

assessment.

Evidence-Based Decision

Making

For both the public and private sectors,

analytics plays a critical role in evidence-

based decision making. Today, it is vi-

tal that management focus on reducing

mountains of collected data into digestible

insights that will drive clear and effective

business practice. Legislative Officers, in-

cluding Auditors General, Financial Ac-

countability and Budget Officers, are al-

ready applying data analytics with direct

access to huge data bases to perform their

mandates toward value-for-money assess-

ments and effective oversight.

In the 2015 Budget, the Ontario govern-

ment announced its new Centre of Excel-

lence for Evidence-Based DecisionMaking

to build capacity to assess how programs

are performing, using evidence to inform

choices and lead change in critical public

services with increasing transparency and

accountability.

Communities of Practice

The Ontario Public Service (OPS) has also

established a Communities of Practice

(COP) process. The goal of the COP is to

“advance the knowledge of those within

government who pursue analytics and are

looking to discover new methods, trends,

techniques and understanding of the

field.” The ability to convert data to practi-

cal knowledge will strengthen user group

skills and confidence, and result in clear

and insightful program management.

There is a clear opportunity for internal

audit to formally invest in cross-cutting

data management COP. The need to apply

relevant consulting expertise and ensure

cost effective assurance opinions are sup-

ported by the application of control as-

sessments that mirror innovative business

process. Data intimacy allows for horizon-

tal links across seemingly disparate pro-

grams (which in fact are quite similar in

structure) to which tested techniques can

be applied and leveraged.

Data Drivers: Key Success

Factors for Auditors and

Clients

The strategic approach and the examples

outlined above reflect the following guid-

ing principles when embarking on your

own internal audit journey:

• Treat the endeavour as an investment,

and establish collaborative linkages

• Define the initial objective. Establish a

Plan. Define the ROI.

• Start with a critical mass of dedicated,

adequately experienced enthusiasts

• Establish an intimate knowledge of key

business processes

• Define success factors to test a hypoth-

esis

• Gather data from multiple sources and

DO NOT BE DETERRED from this task!

• Organize data, noting interrelationships,

and quality/integrity controls

• Document the process

• Respect the present culture and barriers

to change

Data visualization can be an additional crit-

ical guiding principal as it facilitates under-

standing of data sets and provides ability

to drill down and get to the transaction in

question. “Visualization tools provide visual

representation of the data, facilitating orga-

nization of complex information, driving

insights from the data and optimizing user

needs. Within the agile world of identifying

risks, the art of visualization is a strategic

asset for internal audit teams.”

Conclusion

Recognizing that the internal audit pro-

fession is evolving, effective leaders are

innovating processes by investing in data

analytics and technological tools. Sophisti-

cated decision-making is not simply about

analyzing more variables, crunching larg-

er data sets or running complex models. It

requires a fundamental change in mindset

that begins with senior managers and con-

tinues throughout the entire organization.

Data analytics must be seen as an invest-

ment with consistent, continuous improve-

ment that requires sustained commitment

under focused leadership. The benefits of

advanced data management support im-

proved risk assessment, focused control

design, monitoring, and timely corrective

measures. Change is happening all around

us and it will take constant capacity build-

ing, supported by leading-edge resources

to transform the way internal audit func-

tions and supports its clients.

arren

is Director of Internal

Audit, Ontario Public Service, Treasury

Board Secretariat. He is grateful for

the support of the Government Inter-

nal Auditors Council of Canada

ourtney

rown

is a Director within

the Data Assurance and Analytics

group at PriceWaterhouseCoopers.