Annex – Assessment of Internal Control over Financial Reporting (DPR 2012-13)

For the fiscal year ending March 31, 2013

1. Introduction

This document provides summary information on the measures taken by the Office of the Public Sector Integrity Commissioner (the Office) to maintain an effective system of internal control over financial reporting, including information on internal control management, assessment results and related action plans.

Detailed information on the Office’s authority, mandate and program activities can be found in the 2012-13 Departmental Performance Report, the 2012-13 Report on Plans and Priorities and the 2012-13 Annual Report.

2. Departmental system of internal control over financial reporting

2.1 Internal control management

The Office has a well-established governance and accountability structure to support its assessment efforts and oversight of its system of internal control. An internal control framework, approved by the Commissioner, is in place and includes:

  • Organizational accountability structures as they relate to internal control management to support sound financial management, including roles and responsibilities of senior managers in their areas of responsibility for control management;
  • A code of values and ethics;
  • Ongoing communication and training on statutory requirements, and policies and procedures for sound financial management and control; and
  • At least annual monitoring of and regular updates on internal control management, as well as the provision of related assessment results and action plans to the Commissioner and senior management and, as applicable, the Audit Committee.

The Audit Committee is mandated to provide advice to the Commissioner on the adequacy and functioning of the department's risk management, control and governance frameworks and processes.

2.2 Service arrangements relevant to financial statements

The Office relies on other organizations for the processing of certain transactions that are recorded in its financial statements as follows:

Common Arrangements

  • Public Works and Government Services Canada centrally administers the payments of salaries and the procurement of goods and services in accordance with the Office`s Delegation of Authority, and provides accommodation services;
  • The Treasury Board of Canada Secretariat provides the Office with information used to calculate various accruals and allowances.

Specific Arrangements

  • The Canadian Human Rights Commission (CHRC) administers the information technology (IT) infrastructure services, provides a GX financial system platform to capture and report all financial transactions and performs financial transaction processing and reporting on behalf of the Office. The scope and responsibilities are addressed in the interdepartmental arrangement between CHRC and the Office. CHRC has the authority and responsibility to ensure that payments and transactions are recorded in accordance with the Financial Administration Act and other applicable legislation, regulations, authorities, policies and directives. As a result, reliance is placed on the control procedures of the CHRC.

3. Departmental assessment results during fiscal year 2012-13

The key findings and significant adjustments required from the current year`s assessment activities are summarized below.

New or significantly amended key controls: In the current year, as a follow up from the assessment of controls in prior years, a physical asset directive was developed and communicated and the inventory listing of assets was completed. In 2012-13 the Office developed an internal Code of Values and Ethics holding a moderated implementation and discussion session, visibly promoting the set of values throughout the Office.

Ongoing monitoring program: As part of its ongoing monitoring plan, the Office reviews and updates annually its process flows and narratives, which include documenting controls. No significant control issues were found. Reliance was placed on the internal audits of contracting and acquisition cards and the contribution program as an element of monitoring controls of operating expenditures and design effectiveness of the contribution program. The finance staff of the Office utilizes substantive procedures to obtain additional internal assurance over the financial reporting, given the micro size, centralized operations and limited types of transactions recorded.

4. Departmental action plan

4.1 Progress during fiscal year 2012-13

Progress During Fiscal Year 2012-13
Previous year's rotational ongoing monitoring plan for current yearStatus
Operating expenditures Completed; remedial actions started.
Contributions Completed; remedial actions started.

4.2 Action plan for the next fiscal year and subsequent years

The Office's rotational ongoing monitoring plan over the next three years, based on an annual validation of the high-risk processes and controls and related adjustments to the ongoing monitoring plan as required, is shown in the following table.

Rotational Ongoing Monitoring Plan
Key control areasFiscal year
2013-14
Fiscal year
2014-15
Fiscal year
2015-16
Entity-level controls Yes Yes Yes
IT general controls* No Yes No
Contributions No Yes No
Operating expenditures* No Yes Yes
Financial close* Yes No No
Master data on vendors Yes No No
Payroll* No Yes No

* under Office management

2015-10-21