Item - 2021.AU9.18

The Audit Committee recommends that:

1.  City Council authorize a one-time exemption from the requirement in City of Toronto Municipal Code Chapter 3, Accountability Officers, that the Auditor General undergo an external peer review once every three years, so that the external peer review of the Auditor General's Office originally due in 2021 will be completed by the end of 2022.

Chapter 3 of the Toronto Municipal Code requires that the "Auditor General shall undergo an external peer review once every three years to ensure compliance with government auditing standards" and that "the results of the external peer review shall be reported to Council through the Audit Committee".

In March 2020, the Association of Local Government Auditors (ALGA) temporarily suspended all in-person peer reviews due to travel restrictions and health and safety. To date, ALGA has not yet resumed its peer review program. By suspending its in-person peer program, ALGA recognizes there will be some audit organizations, like our Office, that will not meet expected period review timelines. ALGA has been granted the authority in accordance with government auditing standards to extend the time frame for peer reviews for any audit organization participating in its peer review program whose peer review is affected by the COVID-19.

The purpose of this report is to request City Council to allow the Auditor General to defer the external peer review of the Auditor General's Office to 2022 due to challenges and delays caused by the COVID-19 global pandemic.

Our request to defer the external peer review of the Auditor General's Office to 2022 is consistent with other audit organizations who participate in the peer review program administered by ALGA. The external peer review in 2022 will be conducted in accordance with the ALGA policy for COVID-19 delayed peer reviews. The Auditor General has received the highest rating, an unqualified opinion, in the last review.

Council's authorization of the one-time exemption from the Municipal Code requirement in order to defer the external peer review to 2022 will require a two-thirds vote of all Members of Council, in accordance with Section 3-1.11 of City of Toronto Municipal Code Chapter 3.