City’s Office of the Auditor General completes audit of City Transfer Payments and Grants

HAMILTON, ON – The City of Hamilton’s Office of the Auditor General (OAG) performed an audit of City transfer payments and grants as part of the Council-approved OAG General Work Plan 2023-2026.

The City of Hamilton is accountable for the effective governance, management and administration of transfer payments and grants. It requires the City to establish a process to ensure transfer payments achieve the intended outcome. Therefore, the City must ensure grant programs are administered carefully and value of the investment is realized.

The audit found that the City has been operating without a centralized governance structure and corporate polices. Historically, transfer payment administration and management has been left to the individual program and service areas.

The OAG recommends that the implementation of a unified transfer payment administration, accompanied by further policy and planning to oversee transfer payment and grant programs, will result in increased transparency and accountability to the public.

The OAG made recommendations to management for improvement; all six were agreed upon.

A summary of the recommendations to management:

• Establish governance structure and policies for managing transfer payments
• Publish annual reports on transfer payment performance
• Review how transfer payments are recorded in the financial system to improve data extraction and reporting
• Conduct a risk assessment for all transfer payment and grants recipients
• Monitor and evaluate recipient performance in relation to recipients’ risk profile
• Perform regular evaluations of transfer payment and grant programs based on risk

“Our audit found that the City of Hamilton needs stronger governance, oversight and transparency for transfer payments and grants. Through clear, achievable recommendations that we have made to management, the goal is to close policy gaps,” said Charles Brown, Auditor General. “We will closely monitor the City’s progress to ensure these gaps are bridged and taxpayer dollars are properly protected.”

Quick Facts:

• The audit's objective was to assess whether the City has adequate systems and controls in place to support effective and accountable delivery of its transfer payments and grant programs
• This audit supports Priority 3, Responsiveness & Transparency of the Council Strategic Priorities.