Recommendation:
Foreign Affairs, Trade and Development Canada, Human Resources and Skill
Development Canada, Aboriginal Affairs and Northern Development Canada, and
Transport Canada should complete their assessment of internal controls within
the planned timelines, including addressing gaps and weaknesses. In
addition, these four departments and Veterans Affairs Canada should fully
implement a program of ongoing monitoring without delay.
Management
Reponse: Agreed. Aboriginal Affairs and Northern Development Canada, Human
Resources and Skills Development Canada, and Transport Canada recognize the
importance of completing the testing of internal controls over financial
reporting, addressing gaps and weaknesses, and implementing a program of
on-going monitoring of these controls, while working on other equally
important priorities.
Each
department has put in place systems for internal controls over financial
reporting, including requirements for internal reconciliations and analysis,
and post verification reviews. Work is under way to ensure that these and
other internal controls are operating effectively to mitigate risk.
Building
on concrete steps taken to date, the departments will undertake to complete
their first full risk-based assessment of internal controls over financial
reporting, including identifying and addressing gaps and weaknesses in
internal controls by 31 March 2015, 31 March 2016, and 31 March 2014
respectively. As the initial assessment for each key process is completed,
Aboriginal Affairs and Northern Development Canada, Human Resources and
Skills Development Canada, and Transport Canada will implement a program for
continuous monitoring of their internal controls over financial reporting. |
Transport Canada (TC) will complete the operating effectiveness
testing of remaining processes (Revenue, Travel, Journal Voucher and
Contracting/
Commitments) from its first full risk-based assessment of internal control
over financial reporting during 2013-14. A detailed action plan has been
developed to track progress.
A strategy for ongoing monitoring is complete, as outlined in TC’s Internal
Control over Financial Reporting (ICFR) Framework for Risk-based Assessment
and Monitoring. On-going monitoring has commenced. |
March 2014 |
Update of IT Financial Systems Risk
Assessment
Test Operating Effectiveness for remaining processes on a departmental sample
basis
Draft of PIC Assessment Reports including remediation and management action
plans
|
Expert
consultant has completed an updated risk assessment of the ITGC in respect of
the department's financial systems. The results of this ITGC risk assessment
form the basis of the test plan. ITGC operating effectiveness testing is now
underway and on schedule.
Operating effectiveness testing for remaining processes (Revenue, Travel,
Journal Voucher, and Contracting/Commitment) are underway at 40% complete.
Financial Close controls assessment is underway at 75% complete.
A system of on-going monitoring has been implemented. An updated design and
operating effectiveness testing of the procurement process are underway at
50% complete.
Drafting of PIC Assessment reports, including management action plans to
remediate weaknesses, has commenced for certain business processes following
the completion of the test of operating
effectiveness. |