I would be very pleased to do that, Mr. Chair.
As I indicated in my opening statement, the government announced, or committed, in 2004 to having the financial statements of all departments and agencies audited. These are big organizations for the most part. The biggest government departments spend many billions of dollars and have billions of dollars' worth of assets and liabilities under their control.
When the government made that announcement, the office publicly came out and said that we thought it was a good idea. There were two key reasons why the government did this: it will lead to the strengthening of internal controls in those departments--the management and control of all those assets, liabilities, and resources--and it will lead to better financial information for Parliament. The Department of National Defence spends $20 billion a year. We thought it made sense that the Department of National Defence would prepare a separate financial statement on its operations. We came out in support of that.
As I indicated in my opening statement, though, it was never formalized in a policy decision. Government launched some plans to get the departments ready to prepare those financial statements and initially indicated that it wanted to have the financial statements of the largest 23 or 24 departments ready for audit by 2009. One department made that deadline. That was the justice department, as I indicated in my opening statement. We were pleased to audit those financial statements and give an unqualified opinion on those financial statements.
However, reflecting the fact that there was never a policy decision of government to move in this direction, and the fact that for the big departments and agencies we were hearing signals that they might not be ready until 2015 or 2016.... The initiative was losing momentum, and it was clear to us that this was no longer a priority for the government.
I believe the Comptroller General has confirmed that today: that the government has decided to approach this initiative in a different manner through their policies initiatives. So the Auditor General said that if this is no longer a priority for our government, we are not going to continue to pursue this initiative for something that's no longer a priority for government.
The only other comment I'd like to add, Mr. Chair, is that I think the Comptroller General is absolutely correct that the auditor's report on a set of departmental and financial statements does not explicitly provide any comfort on internal controls in the department. But the fact that the Auditor General is in there, doing the audit of those departmental financial statements, encouraging a controls-based audit and encouraging the departments to get ready for those controls-based audits.... When they're able to convince us that they're ready, we come in and do the audit and confirm that we can do the audit on a controls basis. That does provide, in my view, some independent validation to Parliament and to this committee that the controls have been strengthened in those organizations.
So the bottom line of our position, Mr. Chair, is that if and when this becomes a policy or priority of the government, the Auditor General is more than prepared to reconsider her position. But if there is no policy decision and it's not a priority—the Auditor General is under resource challenges, too—it doesn't make sense for us to push on this if government isn't itself pushing on it.