Audit Report - Audit of Resettlement Assistance Program (RAP) Contribution Program

Audit Report
Internal Audit and Disclosures Branch
Citizenship and Immigration Canada
October 2005

Table of Contents

• 1. Introduction
• 2. Audit Objectives
• 3. Audit Scope
• 4. Methodology
• 5. Observations and recommendations
  • 5.1. OAG Follow-Up
  • 5.2. RAP Contribution Agreements
  • 5.3. RAP Income Support
• 6. Conclusions
• 7. Management Action Plan

1. Introduction

The Internal Audit and Disclosures Branch completed a risk-based audit plan for Citizenship and Immigration Canada (CIC) that identified the need for an audit of the adequacy of financial and management controls over contribution funding for the Resettlement Assistance Program (RAP).

Resettlement assistance is provided by CIC to the Convention Refugees Abroad and Humanitarian Protected Persons Abroad classes admitted to Canada as government-assisted refugees. In 2004–05, the RAP budget was $44 million, based on an annual target of 5,700 government-assisted refugees. About 80 percent of the RAP funds go directly to government-assisted refugees in the form of income support payments. These funds are used to support a refugee’s income for up to one year or until that person becomes self-sufficient, whichever comes first. In exceptional circumstances, this can be extended up to 24 months. The remaining 20 percent goes toward the costs of operating RAP reception centres to help pay for:

• meeting the refugee at the airport or port of entry;
• providing temporary accommodation if needed;
• helping find permanent accommodation;
• basic household items;
• financial orientation; and
• ensuring that the refugee has continued access to support where necessary.

The CIC Refugees Branch manages the delivery of resettlement assistance in all regions, with the exception of Quebec. Contribution agreements with service provider organizations (SPOs) are generally managed by the local offices, except in the Ontario Region where they are managed at regional headquarters. RAP income support payments are managed by the local offices in all the regions.

2. Audit Objectives

The objectives of the audit were to assess the following:

• the adequacy of financial and management controls over the contribution agreements;
• compliance with financial authorities as defined in the Financial Administration Act (FAA);
• compliance with the departmental criteria governing income support payments as defined in the inland processing manual entitled In-Canada Processing of Convention Refugees Abroad and Members of the Humanitarian Protected Persons Abroad Classes, Part 2;
• follow-up on the recommendations made by the Auditor General in Section 4 of the 2001 report Voted Grants and Contributions: Program Management.

3. Audit Scope

The audit scope covers the progress made against the recommendations of the Auditor General, as well as the management of the contribution agreements and income support payments in all regions where the program is delivered. We examined contribution agreements in place in fiscal year 2004–05, and RAP income support payments made between October 1 and December 31, 2004. We did not include an examination of the immigration loan program as it was the subject of a separate engagement.

4. Methodology

There were three lines of enquiry: a follow-up to the OAG 2001 report, the management of contribution agreements, and the compliance of income support payments.

The follow-up to the OAG 2001 report involved interviews with headquarters and regional staff to determine the actions taken in response to the recommendations, as well as obtaining documentation to validate the information gathered during interviews. The file review undertaken to assess the contribution agreements also allowed the audit team to gather information to ensure that follow-up actions had taken place. The two applicable OAG recommendations constitute the criteria for this line of enquiry.

The audit of contribution agreements involved an examination of the management of contribution agreements to ensure compliance with legislation and policy. The criterion for this line of enquiry was compliance with the FAA and Treasury Board’s Transfer Payments Policy. A file review was conducted in the four regions that deliver RAP. Due to the relatively small population of RAP agreements, a sample of SPO agreements was selected based on their dollar value. The two largest SPO agreements in each region were examined. These agreements represented over 50 percent of RAP SPO funding.

The audit of income support payments involved an examination of a sample of 42 income support payments selected from seven local citizenship and immigration centres. The criteria for this line of enquiry involved assurance that the payments complied with the Department’s inland processing manual, and with the FAA.

Audit field work was conducted from January to March 2005.

The audit was conducted in accordance with the Government of Canada’s Policy on Internal Audit, as well as auditing standards prescribed by the Institute of Internal Auditors.

5. Observations and recommendations

5.1 OAG Follow-Up

We expected to find that the Department had implemented the Auditor General’s recommendations as they applied to the RAP program. Two recommendations applied to RAP: the first was that all high-risk contribution agreements should be subject to at least one formal site visit to monitor financial controls and project activities, and the second was that where service providers were delivering services at several locations, monitoring plans should ensure that all locations were monitored over time. None of the contribution agreements in our sample had multiple locations.

We examined eight contribution agreements and found that risk-based monitoring plans did not exist in two cases. Neither activity nor financial monitoring had been conducted on one file without a plan and there was evidence of a financial review on the remaining file. Risk-based monitoring plans will be addressed further in section 5.2.

The six contribution agreements with risk-based monitoring plans had implemented their plan with the exception of one financial monitoring exercise that had not been conducted. Only one of the six contribution agreements with a monitoring plan was considered high risk, and adequate evidence of monitoring was on file.

5.2 RAP Contribution Agreements

We expected to find adequate financial and management controls over the contribution agreements examined. In broad terms, we examined four areas of administration for the contribution agreements, including project selection, approval of the agreement, activity and financial monitoring, and compliance of payments. The criteria for this assessment were drawn from Treasury Board’s Transfer Payments Policy and the FAA.

We found that the payments issued in the contribution agreements that we examined complied with the FAA.

(Section removed)

Recommendation 1

The Refugees Branch should provide guidance specific to the management of RAP contribution agreements, and that outlines the expectations for program officers and reflects Treasury Board policy and OAG recommendations.

Response

The Refugees Branch will develop guidelines specific to the management of RAP contribution agreements that outline call for proposal procedures, the application review and approval process, the signing and amending of agreements, issuing advance payments, monitoring of agreements, the development of a risk-based monitoring plan and the payment process. The guidelines will reflect the Treasury Board policy and OAG recommendations and will be completed by the end of the 2005–06 fiscal year.

Recommendation 2

The Refugees Branch should develop and disseminate administrative tools to RAP officers.

Response

The Refugees Branch will undertake a review of existing administrative tools and will revise or create new material as required. Front-line staff will receive updated program guidance by the end of the 2005–06 fiscal year.

5.3 RAP Income Support

In order to assess RAP income support, the audit team examined a sample of income support payments to ensure compliance with legislation and policy. The criteria were based on the departmental policy and the FAA.

Generally, we found that the payments issued complied with departmental policy, which is to say that the recipient was eligible and that the payment issued was the correct amount. Four of 42 payments were lacking evidence of account verification.

Recommendation 3

As part of the guidance to be provided by the Refugees Branch for the RAP program, the financial authorities for RAP officers should be clearly articulated.

Response

The Refugees Branch will work with departmental finance officers (regional and headquarters) to confirm and clarify CIC and FAA policy with respect to making income support payments under RAP. As described above, the Refugees Branch will develop guidelines specific to the management of RAP contribution agreements that outline the payment process.

6. Conclusions

Overall, we found that the RAP income support program was well managed. In addition, we found that the contribution agreements complied with financial authorities.

(Section removed)

7. Management Action Plan