Thank you very much for the question.
Perhaps I should start by indicating that the Office of the Auditor General absolutely accepts that deciding whether or not financial statements of departments are required to be audited annually is a government decision and ultimately a parliamentary decision. The Auditor General's office will work with whatever decision is made by the government and Parliament.
As I indicated in my testimony last time, Mr. Chairman, when the government first announced the initiative to move toward audited departmental financial statements in 2004, we in the Office of the Auditor General thought that was a good idea. We thought that was going to help to put the discipline in the system to improve those internal controls so that the departments themselves would have the benefit of knowing that they produce quality financial information. This approach also provides more reliable information for Parliament.
As you've heard again today, Mr. Chairman, government has indicated that it's adopting a different approach now. It's putting more emphasis on its new policy suites and on increased disclosure by departments.
At the last hearing, you also heard that the government had indicated that they received initial estimates from departments that they would require over $300 million to be able to strengthen their controls in order to audit their financial statements. I don't know where that number came from--we were told that it came from departments--but I guess the question I would ask this committee to consider is that if this $300 million is required to strengthen controls in order to support audited financial statements, would it not also be required in order to fully implement the new policies that you've heard about today? If we're going to report effectively on internal controls, it would seem to me that those types of control weaknesses would need to be addressed in any event.
I don't know if I've answered your question, but ultimately it is a government decision. We think this will help to improve the discipline in the system to strengthen those controls. It will provide independent validation, not explicitly but implicitly, by virtue of the fact that the Auditor General will be in there auditing at a departmental level rather than at the level of the whole of government, as she does for purposes of the public accounts opinion.