Saturday, May 18, 2013

Is the Senate Independent Auditor Independent?

The giant accounting firm, Deloitte, was retained to conduct a forensic audit of the expenses claimed by specific senators.   In three cases there were questions of whether the individuals were in fact entitled to the extra housing allowance the senate provides to members not from Ottawa and environs.

And then, because her travel expenses seemed out of line, they also looked into the spending/reiumbursement of senator Pam Wallin of Wadena, Saskatchewan.

Something happened yesterday that raises new questions - this time concerning the auditor, Deloitte, in its audit of Pam Wallin.

It began when Pam Wallin announced she was temporarily "recusing" herself from the Conservative caucus.  That fell apart when CTV reported that she didn't jump, she was pushed, by the Prime Minister's Office after Harper officials had reviewed the preliminary audit into Wallin's expenses.

That one little detail speaks volumes.  Just what was Deloitte doing feeding preliminary audit results directly to Information Control Central, the PMO, if, as the CTV report suggests, that's what actually happened?

This certainly raises the appearance that the audit process is being manipulated for spin control purposes - the prime minister gets to see the results and cull the herd long  before the public or the opposition gets a whiff of what's coming.   And if that is in fact what's going on, surely Deloitte has become co-opted into the partisan political process of the PMO which raises questions about the integrity of the audit itself and what else Deloitte has been up to in the course of its investigations.

Stephen Harper is renowned as a control freak and he's shown that he's obsessed with maintaining an iron grip on information in all aspects.

The public needs to know if Deloitte was independent of the government in these audits as claimed.

So many questions.  Did the independent auditor give the PMO a sneak preview of Mike Duffy's political urine test results too?  Did the auditor, deliberately or inadvertently, help the prime minister and his staff shape their now failed plans to simply slip Duffy a cheque to make this all go away?  Has Deloitte been an insider all along?


Purple library guy said...

So many questions, to which my hazarded answers would be yes, yes, and yes.

crf said...

Deloitte being coopted is a possibility. But one of among many, and probably not the most likely.

It's hard to conduct an audit in secrecy (and it isn't usually the main goal). Deloitte's people would have to pose a lot of questions to a lot of people. So the questions asked and data uncovered during that process may not be secret, and so could have come to the knowledge of political people in the PMO, in a completely legitimate fashion.

Furthermore, as anyone paying attention to this government knows, they are centralizing information control freaks, to a degree that would make a soviet communist government blush, and have grown their tentacles into every corner of the civil service. It is for certain that job priority number one for innumerable civil servants is to inform the PMO of anything that may affect the government's reputation. If Deloitte is about to uncover something, the PMO needs to know about it first, or someone's head rolls.

But a relative of mine working in government had his area subject to an audit a while back (not by Deloitte, but initiated by the auditor general of Canada). He wasn't impressed with some of the questions or procedures used by the auditors (including their communicating documents and email from personal gmail or hotmail accounts). I don't remember the details of that episode from a few years back, but it's possible that free-agent auditors would be doing a lot of the work, and don't have (or care to exercise) a lot of control over the procedures and work habits they use. I don't know anything at all about Deloitte's practices, but if it is like that of the government's own auditors, it might not be a bad bet that simple sloppiness on the part of the those auditing could result in leaks.

Bluegreenblogger said...

Hmm, from what I have read, the Audit was commissioned by the Senate Committee. As such, the auditors would be reporting to the chair most likely, which would include preliminary findings etc. The terms of Deloittes engagement would be outlined in an engagement letter, where the auditor would lay out precisely what they were engaged to do, who the users of the report were going to be, time frames, methods employed. That letter would be signed by whoever was tasked with engaging the auditor from the Senate Committees side. It would be pretty interesting to find out what exactly they were engaged to do. It is already public knowledge that the Senate committee gave Duffy a sneak peek at the progress. Of course they did! The PMO as well without a doubt. The Senate will supress the report for sure, because they can, and it will be damaging. Not sure how they will react when the RCMP comes calling. That is probably why a second audit has been announced, one that will not be questionable in any respect. You can be sure that every angle is being scrutinised by the CPC already, preparing for the day when the whole mess is scrutinised by law enforcement officers. If, and when charges are pressed, every stinking detail is going to come out, and Wallin and Duffy are both going into the trashcan

Anonymous said...

Deloitte is the firm that was being paid 90,000 a day to help the government decide on cut backs. And Deloitte is heavily involved with the petroleum corporations and not so long ago Deloitte was accused of hanky-panky internationally.

Anonymous said...

It appears that the Harper Government is throwing a lot of business in Deloitte's direction. So it is not inconceivable that the auditors themselves have become corrupted. As it stands, nobody is auditing the auditors. And, as always, one must follow the money.

Deloitte is not the only game in town. These audits should be spread out amongst other Canadian auditing firms, to at least minimize the threat of corruption of the audit firm itself.

The Mound of Sound said...

It's especially difficult when you're dealing with a government such as ours utterly bereft of scruples or integrity. One can go back as far as Cadman to see how far they'll go.

Controlling both access to the results and the timing of their release are powerful advantages in scandal and damage control.

There's no smoking gun in Deloitte's hand, not at all. Yet the "curious" dealings of Wright and Duffy, the "go easy on Duffy" report, the undisclosed (you could say "concealed") payment - all of this begs the question of whether the Harper PMO was able to use advance information to manipulate the fallout.

Deloitte is not necessarily culpable because it wasn't entirely at arm's length. That might not have been even possible in these circumstances. Yet it remains an important factor in considering the audit and any subsequent cover-up.

We know from experience that in a scandal it's common that a minor legal problem is vastly eclipsed by its political ramifications.

Thanks everyone for your insights. They've been very helpful.

Anonymous said...
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The Mound of Sound said...

Anon, calm down. Try not to gorge on your own emotions. What I am saying is that this audit, combined with the apparently porous relationship between the senate standing committee and the PMO, could have created a situation in some aspects beyond the auditor's control.

I can't say that Deloitte is in bed with the government at all and if you have anything to suggest it is, please provide it, failing which you might climb down from your perch.

You might note that I was the first to express concerns about the independence of the auditor and how that could be a problem in light of what we know about Wright and Duffy.

Anonymous said...
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Dana said...

This is probably the same clown who didn't like the fact that you posted so much critical of the dippers.

Progressive Blogger Troll.

The Mound of Sound said...
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Anonymous said...
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The Mound of Sound said...
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Anonymous said...
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Anonymous said...

Hi MoS. Thanks for removing my comments (and yours) of an adolescent disagreement that should never have taken place in a public forum. My apologises.

The Mound of Sound said...

Yes, I agree, it was adolescent on both parts.

Anonymous said...

That's good. Case closed.

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