Thursday, 8 January 2015

Audits: a costly (but necessary?) evil

You might think that the biggest challenge facing non-profit and service agencies in Red Deer — and the whole province — would be fundraising for core services. How do you keep raising the money you need, to do the good things you want to do?

From my many years on boards and committees, I'd say that would be true. But the most aggravating challenge — by far — for me has been data gathering and financial reporting for funding agencies.

Granting agencies, be they governments, foundations or the United Way, want to know two things: is there a need for the service you are providing; and how careful are you with your money? And they want hard numbers, not your word on it.

Trust me, satisfying those two questions sucks more life out of a volunteer board than any other questions you could ask of it. It's easy to get enthused about a fundraiser for needed services. It's a killer when you find the cost of reporting (for which you must also fundraise) costs almost as much as the rent on the office. Every year.

For some years now, taxpayers have been insistently asking the same questions of government.

Enter the value-for-money audit. Exit all the oxygen in the room, and with it, a whole pile of money.

In this year's city operating budget, all city departments together are asking for a total of $468,000 increase for 2015. But city administration is also asking for $200,000 to do a value-for-money audit, for just one of their departments. My reading on this is that they want to do these things for years, one department at a time.

Until they are all so efficient, all that's left in their budgets will be the $200,000 needed for the audit to study themselves.

Plus, admin wants another $100,000 to create Corporate Performance Management Metrics — which is just a six-figure way of saying “survey”.

When children are in school, they want to be astronauts, firemen, doctors, scientists. A smart parent would sing the praises of them becoming accountants and auditors.

That's where the growth is.

Red Deer taxpayers were ready to storm City Hall with torches and pitchforks over $800,000 spent to improve access and safety for city cyclists. Whenever anyone has a grievance against the city — for any reason you can imagine — bike lanes forms part of it.

But if this pilot goes forward, we will have spent that much and more by the time we host the Canada Winter Games. To receive a few reports that hardly anyone will ever refer to.

But if you have to spend a few hundred thousand to show taxpayers that you're not wasting their money, well, that's what you have to do.

What we ask of any charity should be no more than what we ask of government.

I recognize that both city administration and councillors are doing their best to be efficient. After all, didn't they trim $25,000 off the Ross Street summer patio project? Nine more of those, and a value-for-money auditor gets a week with his family at a villa in France.

My question is: which would taxpayers rather have?

I admit it, I'm griping. A city is a very complex organism, and keeping its services running with a minimum of waste is not easy. As well, the people putting up the money for all of this have a right to know they are being respected.

I'm just peeved that this is what it takes. I'd bet that this audit report — if it ever gets published — will show there are efficiencies to be gained in some areas of the department that will be studied. Nothing that a diligent manager couldn't handle, mind you. That's what the $100,000 performance metric study would tell us, wouldn't it?

An value-for-money audit might even produce benefits worth more than $200,000. At least that would be value for money.

But from everything I've learned about audits, I'm glad I'm not in the department to be targeted.

I need my oxygen.

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