To further my understanding of Oshawa's finances, I enrolled in the 5 month Municipal Accounting and Finance Program (MAFP) offered by the Association of Municipal Clerks and Treasurers of Ontario.
I am happy to say I completed all assignments and got word today I passed the exam with a mark of 98%.
I recommend the course to anyone considering serving as a City Councillor. It provides an overview of the basics of public sector accounting; annual municipal financial reporting requirements mandated by the Province, and how to review financial statements.
I am happy to say I completed all assignments and got word today I passed the exam with a mark of 98%.
I recommend the course to anyone considering serving as a City Councillor. It provides an overview of the basics of public sector accounting; annual municipal financial reporting requirements mandated by the Province, and how to review financial statements.
One question, a part of one of the 5 assignments on which I received a mark of 100% (okay ha!! that is me being proud) happened to concern something I personally feel strongly about:
The internal control objective of preventing unwise expenditures and to ensure value for money is not as cut and dry as the other objectives because it hinges on judgment decisions, and involves questioning an individual or team’s judgement, which can be a delicate and controversial matter. In addition to the finance department questioning what may be unwise decisions or decisions that do not seem to constitute good value, in the final analysis it is council that designates priority expenditures, the elected council who exercise ultimate controls, as in their overseer role they are ultimately accountable to the public for how public funds are spent. If the information for decision making is not-reliable, or if decisions are made that it falls to the elected to question the how, why and what controls need to be improved.
The Internal control systems objective to ensure that proper methods and procedures are followed simply cannot work if there are ambiguous policies or undocumented procedures and no training or updating regarding these policies as to what is expected of departments, considering that the organization is never static.
There is an extent to which the culture of an organization “determines how people interpret and act upon information provided through the controls process”. If the organizational culture is unhealthy it affects performance and productivity and has an influence on results with less than desirable outcomes.
Culture reflects values, what is tolerated and what is not. When inappropriate behaviour is tolerated in an organization and no alerts are raised, it would indicate the organizational culture is unhealthy. It may come from the top down, where there is pressure to do the unspoken, or it may come from the lower levels when individuals believe the department heads are oblivious.
The overriding culture of the organization is important to maintaining goodwill, employee adherence and mindfulness to the objectives of system of internal controls. A healthy, honorable culture can help maximize the efficiency of the internal control systems. It is the ultimate check when the control system has been breached.
An unhealthy, unstable culture may involve compromising attitudes, behaviors, values or beliefs that ill-serve the integrity of the organization. When something goes amiss, for example with financial accounts or reports, and the internal controls fail to avert problems ranging from the mildly significant to the scandalous, how the problem is rectified and not ignored, depends a lot on the ‘prevailing culture’ in the organization.
Such things as the level of confidence that anything will be done about it, or if there is a fear of reprisal for reporting wrongdoing, or an attitude that something is okay because it has been accepted by others, work against, challenge and ultimately undermine the internal controls. For this reason, the culture of the organization is very relevant to achieving the objectives of an organization’s internal control systems and long-term success.
- In your view, how relevant is an organization’s culture and value system in achieving the objectives of a system of internal controls?
The internal control objective of preventing unwise expenditures and to ensure value for money is not as cut and dry as the other objectives because it hinges on judgment decisions, and involves questioning an individual or team’s judgement, which can be a delicate and controversial matter. In addition to the finance department questioning what may be unwise decisions or decisions that do not seem to constitute good value, in the final analysis it is council that designates priority expenditures, the elected council who exercise ultimate controls, as in their overseer role they are ultimately accountable to the public for how public funds are spent. If the information for decision making is not-reliable, or if decisions are made that it falls to the elected to question the how, why and what controls need to be improved.
The Internal control systems objective to ensure that proper methods and procedures are followed simply cannot work if there are ambiguous policies or undocumented procedures and no training or updating regarding these policies as to what is expected of departments, considering that the organization is never static.
There is an extent to which the culture of an organization “determines how people interpret and act upon information provided through the controls process”. If the organizational culture is unhealthy it affects performance and productivity and has an influence on results with less than desirable outcomes.
Culture reflects values, what is tolerated and what is not. When inappropriate behaviour is tolerated in an organization and no alerts are raised, it would indicate the organizational culture is unhealthy. It may come from the top down, where there is pressure to do the unspoken, or it may come from the lower levels when individuals believe the department heads are oblivious.
The overriding culture of the organization is important to maintaining goodwill, employee adherence and mindfulness to the objectives of system of internal controls. A healthy, honorable culture can help maximize the efficiency of the internal control systems. It is the ultimate check when the control system has been breached.
An unhealthy, unstable culture may involve compromising attitudes, behaviors, values or beliefs that ill-serve the integrity of the organization. When something goes amiss, for example with financial accounts or reports, and the internal controls fail to avert problems ranging from the mildly significant to the scandalous, how the problem is rectified and not ignored, depends a lot on the ‘prevailing culture’ in the organization.
Such things as the level of confidence that anything will be done about it, or if there is a fear of reprisal for reporting wrongdoing, or an attitude that something is okay because it has been accepted by others, work against, challenge and ultimately undermine the internal controls. For this reason, the culture of the organization is very relevant to achieving the objectives of an organization’s internal control systems and long-term success.