Audit of The Administration of the Resettlement Assistance Program

3.0 Observations and Recommendations

3.1 Governance  

The audit examined the adequacy of three areas of the governance framework in place for RAP. These were governance and strategic direction, accountability and risk management.

We found that the governance framework in place for RAP was similar to the one in place for settlement programs, which we reported on in our audit of the administration of settlement programs. This is outlined in Appendix D. In this instance, the Refugee Branch was responsible for program design while the OMC Branch was again responsible for operational guidelines and standards to support the national implementation of this program. Both programs also shared the same committee reporting structure. At the time, we found that this structure was appropriate.

Subsequent to our report on the audit of the administration of settlement programs, the Department underwent some changes that revised the governance structures outlined in Appendix D. They are as follows:

• Functional authority in finance for grants and contribution programs: In early 2010, the Department established functional authority for its G&C programs in the Department’s Finance Sector. To support this, the Department created a Grants and Contributions Management Directorate within the Financial Management Branch. The directorate is responsible for providing support and coordination to the Department on its G&C programs.
• Creation of the Business Operations Committee (BOC): In early 2010, the Department created the BOC to provide senior leadership oversight and strategic guidance to support excellence in program and service delivery and innovative business transformation. This included oversight of strategic guidance on the operational aspects of CIC’s contribution programs, direction on business process improvements, emerging issues (including risk) and review of operational performance.
• Creation of a new branch: In June 2010, CIC transferred responsibility for the delivery of all of CIC’s integration programs, settlement, resettlement assistance, the Foreign Credentials Referral Office and multiculturalism to a new branch called Integration and Program Management Branch within the Operations Sector. The key responsibilities will include the development of a strategic approach to the delivery and management of grants and contributions programs, the development of operational policies and tools, the national coordination and functional guidance for program delivery in all regions, and the delivery and management of the NHQ components of programs.
• Refugee reform: As part of CIC’s planned refugee reforms, funding levels would be updated to reflect program needs and consequently decrease risk management practices and the resulting burden on the governance framework. RAP would see a 20 percent increase in funding. This would be the first permanent funding increase in over 10 years and would allow RAP funding to catch up with current provincial social assistance rates in order to provide refugees with access to immediate and essential services.

As part of our audit of the administration of the settlement programs, we made nine recommendations, five of which were in the area of governance. Because of the shared governance structures of the settlement programs and RAP, the resulting management responses, action plans and changes identified above have served to strengthen the governance framework for G&C programs within the Department, including RAP.

3.2 Performance Measurement

The audit assessed the adequacy of the performance measurement framework in place for RAP. Specifically, we expected to find that processes existed to ensure that planned results and outcomes were linked to organizational objectives; that management monitored and reported on performance and considered performance information in decision making; and that controls were in place to ensure that performance measures were complete and accurate.

As in our findings in our audit of the administration of settlement programs, we found that the performance measurement framework was still under development. Various information at the output level is captured in the departmental information systems. We note that the Department has made attempts at measuring this program through evaluations and studies over the years. At the time of our audit, the Department had implemented a G&C dashboard reporting which included RAP. This dashboard included quarterly reporting on financial and output information for all of CIC’s G&C programs.

With regard to the internal controls in place to ensure that information is complete, we examined the controls in place over iCAMS data entry by comparing the number of SPOs who were supposed to report in iCAMS to the number that were actually reporting. We found that all RAP SPOs who should have reported in iCAMS were, indeed, reporting. Since our previous audits, the Department has created the OMC Branch to improve consistency of delivery. Our discussions with staff in this branch determined that, while they do some review of data and provide administrative support to users, the primary responsibility for ensuring the accuracy and completeness of iCAMS data remains that of the local CICs. This is discussed in more detail in section 3.3.1.

3.3 Internal Controls

The audit assessed the adequacy of internal controls over the administration of transfer payment programs to ensure compliance with applicable policies. We expected to find that appropriate controls were in place to ensure:

• an adequate review process for proposals;
• an appropriate process to approve agreements;
• adequate monitoring of agreements;
• compliance with financial administration processes; and
• compliance of income support payments with policies.

3.3.1 Contribution Agreement Process

Our audit reviewed the controls in place for the contribution management process outlined in Appendix B. At the time of our audit, the guidelines used to manage contribution agreements officially only applied to settlement programs but were used for RAP agreements. We found that these guidelines were indeed applicable. Our review of the CA process found the following:

• Proposal Assessment: We found that a formal review mechanism was in place but that this process was not adequately documented. In 62% of the sample, there was little documentation to support the assessment of proposals against selection criteria.
• Signing of the Agreement: Generally, the process was followed and complied with the delegated authorities.
• Monitoring of Agreements: Our audit found that in 31% of our sample, there was no evidence of planned activity monitoring, and that 31% lacked evidence of planned financial monitoring. Moreover, we found that 77% of agreements lacked evidence of monitoring of SPO iCAMS data entry. Unlike settlement CA, all RAP SPOs should report in iCAMS. We also note from our previous audits that we had found monitoring to be an issue and, therefore, had made recommendations in this area.
• Financial Administration: We found that 38% of agreements in our sample did not contain updated cash flows which are to be requested if claims for payment vary from planned expenditures.
• Close-Out: We were unable to conclude on close-out procedures as many of the agreements included in our file review were not completed and closed out. In some cases, this was due to the timing of our visit.

These findings are consistent with those of our audit of the administration of settlement programs, as well as those of the Finance Sector’s review of various regional operations. It was the Department’s intention to update its guidelines on settlement in 2010 and make them officially apply to RAP. Furthermore, recommendations, management responses and action plans developed as part of our audit of the administration of settlement programs should address the above observations. We also note that the creation of a G&C directorate in Finance should strengthen financial practices from this point on. Therefore, we have no further recommendations.

3.3.2 Income Support

RAP also contains a component of direct support to refugees in the form of income support. Therefore, we also examined a sample of income support payments and the controls in place to ensure that they were issued in compliance with departmental policy. We expected there would be a process in place to determine if the recipient qualified, set the level of support, monitor the status of the recipient and issue payments.

We found that:

• In 24% of sample files, there were errors in the determination of the level of income support. In some instances, the rates for certain categories were above or below the rates set by the Region or the Department. The result is that some clients may have received higher or lower amounts than they were entitled to. This likely happened due to the frequency of rate changes and the lag in communicating these rates. Most observed variations were small amounts and not deemed material.
• In 11% of files, changes to the status of the recipient were not documented in accordance with policy. If not documented appropriately, not all status changes may be factored in when adjusting income entitlements. This could result in under- or overpayments to the client. However, this policy requirement does not take into account the role of the SPO in monitoring the status of income support recipients, which serves to compensate for the non-completion of these forms.
• A large number of files included in the sample had issues with respect to delegated authorities related to the issuance of income support payments. Fifty percent of the sample files had issues with respect to initial payments in terms of the setting of financial commitments or segregation of duties for the issuance of payments, and 51% had issues with respect to ongoing payments.
  • Initial payments: Departmental guidelines indicate that commitments in excess of $15,000 must be approved by the CIC Office Manager. Generally, we found that commitments for larger families were above this threshold and, in some cases, were being made by staff without the appropriate delegated authority. We also found that in a large number of the cases examined, when the initial cheque was issued on the departmental bank account, the person who authorized the issuance was one of the two signatories on the cheque. Government policy requires that the individual who approves the payment be different from the individual who issues the payment in order to maintain appropriate segregation. The risk associated with these observations is that unauthorized individuals may be setting up commitments or staff may be authorizing and issuing payments without sufficient secondary review.
  • Ongoing payments: We found that the documentation of Section 34 approval (confirming that a payment is warranted) was not always done. This is due in part to the control process reflecting a single office paper-based system, which is not the case for the majority of offices issuing RAP income support payments. However, if the documentation of Section 34 is not done, the individuals authorizing Section 33 (those authorized to release the funds) cannot be certain that a payment has been authorized.

We also found that:

• The delegated signing authorities for officers were not regularly updated and, therefore, delegated authorities did not specify limitations that matched the Department’s approval authority for staff at different levels;
• The delegation of signing authority for departmental bank account cheques, with regard to the number of employees with the authority to sign, exceeded departmental policy in most offices; and 
• The delegation of signing authority for departmental bank account cheques, with regard to the documentation of delegation, was not done consistently with other delegations of financial authority.

Recommendation
That the Integration and Resettlement Program Delivery Division of the Integration Program Management Branch, along with the Grants and Contributions Directorate within the Financial Management Branch, review the control process in place for income support payments and ensure that the necessary approvals are documented as required and in accordance with delegated authorities.

Management Response
In the fall of 2010, the Grants and Contributions Directorate within the Financial Management Branch will establish and lead a national working group comprised of national and regional finance representatives, as well as program representatives, as required.

The working group will review the controls in place for income support payments and issue guidelines as required to ensure that the necessary approvals are documented in accordance with delegated authorities by April 2011.

3.4 Enhanced Follow-Up

As part of this audit, we conducted an enhanced follow-up to the recommendations made in past audits. This was intended to provide a status report on the progress made on each recommendation and its associated management response, which together constituted the criteria for our assessment.

In line with our findings in our audit of the administration of the settlement programs, we found that progress on the implementation of past recommendations did not meet our expectations as a result of changes in the operating environment. Therefore, the outstanding recommendations have been incorporated into the new recommendations, the management responses and the action plans included in that report. The results of our enhanced follow-up work were included in our most recent presentation to management on regular follow-up and are summarized in Table 2 below.

¹Moving forward, the Department has developed an action plan that addresses these issues as part of the revised recommendations made in the audit of the administration of the settlement programs. Therefore, those recommendations not yet implemented have been replaced and are no longer applicable as a result of our audit work.

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