11010 Studies

Dec-2022

Direct engagements and annual financial audits are the predominant forms of examination used by the Office to fulfill its legislative mandate. However, studies provide a form of inquiry that may be appropriate in some circumstances. Although studies are not assurance engagements, they are performed with the same degree of professionalism, quality, and rigour as other Office products. Teams therefore must apply systematic, disciplined, evidence-based approaches. Because readers of our reports may not make the distinction between an audit and a study, there is a risk that a study report may be misinterpreted. By applying most of the Direct Engagement Methodology to studies and the Office’s System of Quality Management, the Office reduces its reputational risk to an acceptable level.

Differences between an audit and a study

There are three main differences between an audit and a study:

1. Purpose. In a direct assurance engagement, an audit objective and pre-established criteria guide an examination of management performance. Audit reports are intended to provide assurance on whether the underlying subject matter has been managed with due regard to aspects of economy, efficiency, effectiveness, and environmental effects. Audit reports provide findings relative to suitable criteria and a conclusion against a pre-established audit objective. By contrast, studies carried out by the Office do not involve an examination of, or assurance on, management performance.

   Studies carried out by the Office should have a well-defined purpose. Examples include

   • to describe a subject;
   • to develop an information base;
   • to develop a common understanding of a subject;
   • to identify lessons learned and good practices;
   • to draw attention to a certain area of concern or leading thinking; and
   • to identify expectations, methods, or criteria to use in future examinations.

   When determining whether a study should be carried out by the Office, consideration should be given to whether the Office will be recognized as a qualified or authoritative source of information on the subject matter; and whether the Office’s statutory rights of access to government information is important for the conduct of the study. If the answer to one or both of these questions is no, serious consideration should be given to engaging outside experts to carry out the study.

2. Assessment. Because studies are not used to assess management performance, criteria are not needed to conduct a study.

3. Reporting. Because studies carried out by the Office do not involve an assessment of, or assurance on, management performance, they do not include conclusions about management performance or recommendations to management. Also, studies do not necessarily include management’s comments.

   Except in rare circumstances, studies and audits concerning the same subject matter should not be combined in the same report, in order to reduce the risk that readers will not recognize their distinct purposes. A specific OAG report template has been established for studies.

Methods and tools to be used

Because Office policies related to the System of Quality Management and direct engagements also apply to studies, teams should use the audit working paper software to document their work, and adapt its content to the circumstances.

It is strongly recommended that teams make use of expert advisory committees. However, if the team believes that such a committee is not necessary, it needs to document the decision in the audit file.

Teams should develop a detailed study plan to guide the work and to ensure that the study remains within budget and timelines.

Teams are expected to have sufficient and appropriate evidence to support statements made in the study report. Studies typically rely extensively on evidence obtained indirectly from other sources. For example, studies often refer to a compilation of third-party research papers or academic studies. Because this evidence is not used to support findings and conclusions about management performance, as would be the case in an audit, teams are not required to directly test the information to obtain assurance about its reliability, accuracy, or completeness.

However, to use the information or data source to support factual statements in the report, teams need to consider

• whether the source of the information or data is reliable and reputable,
• whether the information or data source is subject to quality assurance standards or controls,
• the extent to which the source is widely used or cited, and
• whether other information sources support the same factual statements.

Teams should apply citation rules for academic writing to identify the source, or sources, of information used in the study.