Audit of the Administration of the External Expert Contract for the Strategic and Operating Review

Internal Audit and Evaluation Bureau

Table of Contents

Assurance Statement

The Internal Audit and Evaluation Bureau has completed an audit of the administration of the external expert contract (the contract) for the Strategic and Operating Review for the Treasury Board of Canada Secretariat (the Secretariat). The objective of the audit was to assess the adequacy and effectiveness of the management control framework over the administration of the contract for the Strategic and Operating Review. Following consultations with senior management and concurrence from the Government of Canada Audit Committee, the audit was added to the Secretariat's 2011–12 risk-based audit plan. This audit was initiated due to the contract's complexity and its strong linkage to government-wide priorities. The audit was conducted in conformance with the Internal Auditing Standards for the Government of Canada and the Institute of Internal Auditors' International Standards for the Professional Practice of Internal Auditing.

The examination was conducted by the Internal Audit and Evaluation Bureau during the period of February 2012 and May 2012, and covered transactions for the time period from August 12, 2011, (contract award date) to February 29, 2012. The audit took into consideration evidence gathered up until the drafting of the summary of audit findings in May 2012. The audit methodology consisted of interviews, documentation review, and sample testing. The audit evidence gathered is sufficient to provide senior management with reasonable assurance of the results derived from this audit.

We conclude with a reasonable level of assurance that the management control framework over the administration of the contract for the Strategic and Operating Review was adequate and effective. Specifically, we conclude the following:

  • Roles, responsibilities, and accountabilities with respect to the administration of the contract were clear and communicated;
  • Relevant information on the contractor's performance was gathered and used in the management of the contract to ensure the achievement of deliverables;
  • Processes and procedures were in place and were applied to ensure that funds were being used for their intended purpose; and
  • Administrative processes were in place to effectively manage the contract to comply with applicable policies, to safeguard assets, and to manage change.

In the professional judgment of the Chief Audit Executive, sufficient and appropriate audit procedures have been conducted, and evidence has been gathered to support the accuracy of the opinion provided in this report. The opinion is based on a comparison of the conditions, as they existed at the time of the audit, against pre-established audit criteria. The opinion is only applicable for the entities examined and for the time period specified.

Executive Summary

Background

In Budget 2011, the Government of Canada launched the comprehensive, one-year Strategic and Operating Review to assess the efficiency and effectiveness of government operations and programs across 67 departments and agencies.

The Treasury Board of Canada Secretariat (the Secretariat), on behalf of the Government of Canada, sought the professional services of an external expert advisor (the contractor) to support the Strategic and Operating Review. There was intense pressure for the Secretariat to administer the external expert contract (the contract) at an accelerated pace, given the time constraint to complete the work of the Strategic and Operating Review by March 2012, which over a period of less than eight months involved 191 external resources and 67 departments and agencies, and expended $14.83 million excluding the harmonized sales tax. Furthermore, the contract received high public interest due to its $17.5 million dollar value,Footnote 1 its government-wide impact, and its linkage to government priorities.

Following consultations with senior management and concurrence from the Government of Canada Audit Committee, the audit was added to the Secretariat's 2011–12 risk-based audit plan due to the contract's complexity.

Objective and Scope

The objective of the audit was to assess the adequacy and effectiveness of the management control framework over the administration of the contract for the Strategic and Operating Review.

The scope of the audit was limited to the Secretariat's activities undertaken to manage the contract after it was awarded.

Key Findings

The main audit findings are presented as follows:

  • Roles and Responsibilities: Roles, responsibilities, and accountabilities with respect to the administration of the contract were clear and communicated. In addition, a strong governance structure contributed toward extensive senior management engagement.
  • Performance Management: Relevant information on the contractor's performance was gathered and used in the management of the contract to ensure the achievement of deliverables. Sound performance reporting processes ensured that relevant information was available for management decision making.
  • Financial Oversight: Processes and procedures were in place and were applied to ensure that funds were being used for their intended purpose. Specifically, management's validation of invoices for payment and its financial reporting processes were effective.
  • Administration: Administrative processes were in place to effectively manage the contract to comply with applicable policies, to safeguard assets, and to manage change. Specifically, administrative processes in place were adequate for recommending contract amendments, raising task authorizations, meeting security requirements, maintaining contract documentation, and resolving conflicts.

Conclusion

We conclude with a reasonable level of assurance that the management control framework over the administration of the contract for the Strategic and Operating Review was adequate and effective.

Since this audit found no major deficiencies, there are no recommendations outlined in this report.

1.0 Introduction

The Internal Audit and Evaluation Bureau has completed the Audit of the Administration of the External Expert Contract (the contract) for the Strategic and Operating Review for the Treasury Board of Canada Secretariat (the Secretariat). This audit was added to the 2011–12 risk-based audit plan and was approved by the Secretary in November 2011. It was initiated following consultation with senior management and concurrence from the Government of Canada Audit Committee due to the contract's complexity and strong linkage to government-wide priorities. As well, there was a need for and pressure on the Secretariat to administer this large-value contract, given that many external expert resources were involved during a period of less than eight months.

1.1 Strategic and Operating Review

Budget 2011 launched the comprehensive, one-year Strategic and Operating Review across all of government in fiscal year 2011–12, with an aim to support the return to a balanced federal budget by 2014–15. The objective of the Strategic and Operating Review was to examine direct program spending and identify proposals for reductions in operating, grant and contribution, and capital expenditures, while maintaining the integrity of essential services.

The Strategic and Operating Review examined $75 billion of direct program spending, as appropriated by Parliament, in 67 departments and agencies. Expenditure reduction proposals submitted by ministers on behalf of their departments and agencies were assessed by the Strategic and Operating Review Committee, a Treasury Board committee chaired by the President of the Treasury Board.

Following the deliberations of the Strategic and Operating Review Committee, the Government of Canada announced in Budget 2012 that the deficit reduction plan is expected to achieve ongoing savings of $5.2 billion or 6.9 per cent of the $75 billion of direct program spending that was reviewed. The review identified a number of opportunities to enhance efficiency and effectiveness of government operations, programs, and services that will result in cost savings for the Canadian taxpayer and that will support the Government's commitment to return to balanced budgets over the medium term.

1.2 External Expert Contract

To support the Strategic and Operating Review, the Secretariat, on behalf of the Government of Canada, sought the professional services of an external expert advisor (the contractor). The contractor was required to have a wide range of expertise in advising senior and elected officials on public and private sector best practices for improving productivity and achieving operational efficiencies in large federal government organizations. Consequently, the Secretariat entered into a contract on August 12, 2011, with the contractor, on behalf of the Government, following a competitive tendering process to provide the following:

  • Advise the Strategic and Operating Review Committee on private and public sector best practices to create "lean" processes for operations and administration, including internal services;
  • Assist individual ministers and senior public administration leaders, as required or directed, in assessing internal services and costs for administering programs in their respective departments and agencies;
  • Provide specific advice on federal procurement and asset management practices (including fixed and technology assets), as well as develop implementation plans to drive cross-government efficiencies in these areas; and
  • Examine and advise on how to drive savings from the consolidation of Information Technology services for data centres, related networks, and emails.

These services were delivered through the contract's core work and task authorization mechanisms, as required.

The contract was awarded at a total estimated value of $17.5 million before harmonized sales tax, with $10.35 million allocated to the core work of the contract and the remaining $7.15 million allocated to assist departments and agencies that required additional services related to the Strategic and Operating Review. These additional services were referred to as the task authorization portion of the contract, given that this administrative vehicle was used to access these services on an "as and when requested" basis.

The contract began on August 12, 2011, and ended on March 31, 2012. The actual amount spent at the end of the contract was $14.83 million before harmonized sales tax, with $10.3 million spent on core work and $4.53 million spent on additional services accessed through task authorizations. A total of 191 external resources were involved in the contract.

The Government of Canada also had an option to extend the term of the contract for an additional one-year period under the same conditions, but it did not exercise this option.

1.3 Roles and Responsibilities

Given the scope of the contract, there were a large number of organizations involved. The key organizations included the following:

  • Treasury Board of Canada Secretariat (where the project authority, the project management office role and the policy experts for the areas covered by the review reside);
  • Public Works and Government Services Canada (where the contracting authority resides);
  • The contractor; and
  • Other departments and agencies.

Refer to Appendix A: Roles and Responsibilities for a summary of the key groups involved in the administration of the contract.

2.0 Audit Details

2.1 Authority

The Audit of the Administration of the External Expert Contract for the Strategic and Operating Review was added to the 2011–12 risk-based audit plan due to the contract's complexity. The addition was approved by the Secretary in November 2011.

2.2 Objective and Scope

The objective of the audit was to assess the adequacy and effectiveness of the management control framework over the administration of the contract for the Strategic and Operating Review.

The audit covered transactions for the time period from August 12, 2011, (contract award date) to February 29, 2012. The audit took into consideration evidence gathered up until the drafting of the summary of audit findings in May 2012.

The scope included the Secretariat's activities undertaken to manage the contract following the contract award date. Specifically, these activitiesFootnote 2 consisted of the following:

  • Initiating the work;
  • Raising task authorizations;
  • Overseeing the work of the contractor;
  • Monitoring the progress of the work;
  • Authorizing travel and other direct expenses;
  • Accepting the deliverables;
  • Resolving disputes;
  • Approving payments to the contractor; and
  • Recommending and/or requesting amendments.

Given the nature of the contract, the following key internal players were included in the scope of the audit:

  • Corporate Services Sector;
  • Chief Information Officer Branch;
  • Expenditure Management Sector;
  • Government Operations Sector; and
  • Office of the Comptroller General.

External organizations (Public Works and Government Services Canada, the contractor, other government departments, and key external stakeholders) were included in the scope of the audit to the extent to which interrelationships between the Secretariat and these organizations existed. For example, the audit examined the extent to which there was clarity of roles and responsibilities between the Secretariat and these external parties.

The audit did not include the following:

  • The contract tendering process;
  • The appropriateness of the contract scope or the quality of the work provided by the contractor; or
  • Controls of other government departments or of the contractor.

However, the audit examined administrative processes implemented by the Secretariat to effectively manage the contract that indirectly touched on some of these elements, such as processes to ensure information assets are protected and processes to approve deliverables and claims for payment.

2.3 Lines of Enquiry

The audit included the following four lines of enquiry:

  • Roles and Responsibilities: Roles, responsibilities, and accountabilities with respect to the administration of the contract are clear and communicated.
  • Performance Management: Relevant information on the contractor's performance is gathered and used in the management of the contract to ensure the achievement of deliverables.
  • Financial Oversight: Processes and procedures are in place and are applied to ensure that funds are being used for their intended purpose.
  • Administration: Administrative processes are in place to effectively manage the contract to comply with applicable policies, to safeguard assets, and to manage change.

The audit criteria were derived from the Office of the Comptroller General's Audit Criteria Related to the Management Accountability Framework: A Tool for Internal Auditors.

Detailed audit criteria for each of these lines of enquiry are presented in Appendix B.

2.4 Approach and Methodology

The audit was conducted in conformance with the Internal Auditing Standards for the Government of Canada and the Institute of Internal Auditors' International Standards for the Professional Practice of Internal Auditing. These standards require that the audit be planned and performed in such a way as to obtain a reasonable level of assurance that audit objectives are achieved.

The examination phase of this audit was conducted from February to May 2012. The work carried out during this phase consisted of:

  • Interviews with key stakeholders;
  • Documentation review; and
  • Sample testing.

3.0 Audit Results

The audit results are presented below by line of enquiry.

3.1 Roles and Responsibilities

Roles, responsibilities, and accountabilities with respect to the administration of the contract were clear and communicated, with a strong governance structure in place.

Contract administration and oversight involved various parties from within the Secretariat and from external organizations. We therefore expected to find that the Secretariat would have in place clear documentation of roles, responsibilities, and accountabilities for each of these parties and that these roles, responsibilities, and accountabilities would be clearly communicated.

We found that roles, responsibilities, and accountabilities were appropriately documented. The contract defined the principal roles and responsibilities for the project authority, the contracting authority, and the contractor. These were further elaborated in documents generated post-contract award to expand on core work activities and to describe task authorizations (e.g., statements of work). The contract also referred to Public Works and Government Services Canada's Supply Manual, which provides guidance on standard contract management roles and responsibilities.

Information on the project governance structure including the roles and responsibilities of the project management group, the dedicated project office set up to support the project authority, was also provided through such means as information sessions and email exchanges.

The project governance structure was clear and communicated at the commencement of the contract period. This structure consisted of three forums: the project management weekly meeting; the senior project management weekly meeting; and the Secretary's meeting every two weeks. Existing cross-sector groupsFootnote 3 within the Secretariat were also leveraged for information sharing.

At the project management meeting, project status was reviewed and discussed between the contractor and the project management group. Unresolved issues were then sent up for discussion at the senior project management meeting between the project authority and the contractor's project leads. Records of discussions were maintained for the aforementioned weekly meetings. As required, issues were then escalated and placed on the agenda for discussion at the Secretary's biweekly meeting. This biweekly meeting was attended by the Secretary of the Treasury Board, the contractor's project leads and key senior management from the Secretariat.

While the Treasury Board's Strategic and Operating Review Committee was outside the audit scope,Footnote 4 we found that the Secretariat clearly understood its roles, responsibilities, and accountabilities with regard to managing the contractor's deliverables destined for this committee. It was evident from consultations with the various parties involved in this contract that the needs and priorities of this committee influenced the subject matter and the pace at which work was performed.

In summary, roles, responsibilities, and accountabilities were clearly documented and communicated. In addition, a strong project governance structure facilitated extensive senior management engagement.

3.2 Performance Management

Relevant information on the contractor's performance was gathered and used in the management of the contract to ensure the achievement of deliverables.

To ensure management received relevant information to make informed decisions, we expected the Secretariat to put in place processes for monitoring and reporting contract performance. Furthermore, we expected that relevant measures would be identified and that performance would be reported to the appropriate levels of management.

We found that rigorous performance reporting processes were in place along with senior management engagement at the appropriate levels.

Effective performance reporting processes were in place. Specifically, they included the following:

  • Reporting was frequent. The project management group produced weekly reports, leveraging the contractor's detailed project and financial status reports as input;
  • Reports were comprehensive. Information was provided on progress, financial burn-rate, variances between actual and planned results, and risk areas;
  • Reports were communicated to senior management. Reports were disseminated to the project authority, the Secretary of the Treasury Board, the President's Office and key senior management within the Secretariat;
  • Measures aligned with the deliverables and timelines identified in the contract; and
  • Reports were reviewed weekly, and measures were updated as required to ensure relevance. Updates to timelines, milestones, format, content, and report presentation were evident.

In summary, sound performance reporting processes ensured that relevant information was available for management decision making.

3.3 Financial Oversight

Processes and procedures were in place and were applied to ensure that funds were being used for their intended purpose.

The audit expected the project authority to put in place processes to ensure that funds were being used for their intended purpose. It was also expected that these processes would comply with the Financial Administration Act.Footnote 5

Our findings are based on our examination of a sample of invoices that covered time billed between August 12, 2011, and February 4, 2012. Forty invoices were examined with a total value of $12.9 million, which represented 90 per cent of the amount billed during the examination period and 87 per cent of the final contract total. Invoices that were examined covered both core work and task authorizations.

We found that the project authority did ensure that funds were being used for their intended purpose. Specifically, the project authority's process for validation of invoices for payment worked as intended, and its financial reporting process was effective in ensuring that significant issues were communicated to senior management via the project governance structure described in section 3.1.

During the examination phase, only one exception within the sample of 40 invoices was found. A resource, while approved on the contract, was denied approval to work on a specific task authorization.Footnote 6 This work, in the amount of $5,098, was billed and paid for, but was subsequently credited when the amount was questioned by the auditors. This one exception representing 0.03 per cent of the $15.5 million contract supports the conclusion that given the volume of resources billed, financial oversight processes were effective.

The project authority's process for validation of invoices worked as intended and ensured the following:

  • Resources were approved to work on the contract prior to being billed;
  • Resources were billed at their proper rates;
  • Time billed was reasonable;
  • Formal acceptance of deliverables was obtained before final payment;
  • Invoices were mathematically accurate;
  • Billed amounts did not exceed authorized amounts; and
  • Proper approvals were obtained as required.

The project management group applied effective procedures to validate time billed. It performed a reasonability review and flagged individual resources that billed more than 20 days of work per four-week billing cycle for further review. Also, the project management group monitored contract status against authorized amounts based on the contractor's financial reports and time-reporting systems, which are subject to a separate cost audit conducted by Public Works and Government Services Canada, currently underway.

The approach taken was adequate in ensuring that time billed was reasonable. Through its review, the project management group identified time billed that was not in accordance with the contract and was hence denied. The monitoring controls helped ensure that task authorizations were not billed above their authorized amounts. Final results indicate that 19 of the 27 completed task authorizations were billed below their authorized amounts and that the remaining 8 were billed at authorized amounts.

Given the contract value and its public profile, adequately documenting key decisions is essential to withstand the test of public scrutiny. While financial processes were effective, the audit team found that the rationale for certain procedural decisions, while discussed with the relevant parties, was not fully documented on the contracting file. These documentation gaps were subsequently addressed by management.

3.4 Administration

Administrative processes were in place to effectively manage the contract to comply with applicable policies, to safeguard assets, and to manage change.

The contract was complex given the involvement of a high volume of internal and external resources, the contract's short duration, the large number of departments and agencies able to access the contract, its large dollar value, and its high public profile. To ensure the effective management of the contract, we expected the Secretariat to put in place administrative processes to comply with applicable policies, to safeguard assets, and to manage change.

We found that management defined and put in place the following administrative guidelines and procedures that were aligned with government-wide policies and expectations:

  • Recommending contract amendments;
  • Raising task authorizations;
  • Meeting security requirements;
  • Maintaining contract documentation; and
  • Resolving conflicts and disputes.

We found that these administrative processes were functioning adequately, that processes were in place to update these administrative processes and tools as required, and that these changes were communicated.

The administrative processes in place to manage the contract are described below.

Contract Amendments

Contract amendments were used to formally delete, modify, or introduce new conditions to the original contract. The project authority and the contractor could request amendments to be made; however, sole authority for amending the contract rested with the contracting authority. Therefore, we expected that administrative processes would be put in place to enable the appropriate request and approval of amendments. We also expected that these amendments would be processed in accordance with applicable guidelines on content and format.

There were ten amendments over the duration of the contract. None of these changed the scope of work, and all were issued to formally add or remove resources to or from the contract, with two of them also redefining eligible costs.

We found that all contract amendments were properly approved. In addition, we found that amendments generally followed applicable guidelines, based on a judgmental sampleFootnote 7 of five out of ten contract amendments.

To request an amendment to add resources to the contract, the project management group completed a standard request form and performed the appropriate due diligence, which for most amendments required review of the proposed resources' experience and qualifications for contract eligibility. Following the project authority's signed recommendation, the request form was forwarded to the contracting authority for processing and approval.

During our examination of this process, four exceptions were noted. One was a clerical error where two resources recommended for removal by the project authority were still included in the approved contract amendment by the contracting authority issuing the amendment. The other three exceptions related to the removal of resources and administrative changes made by the contracting authority without the project authority's prior acknowledgment (the contracting and project authorities had subsequent discussions about these changes); further, these changes were not described in the appropriate section of the amendments. While the contracting authority confirmed that there was no contractual requirement for the project authority to review resource removals or administrative changes, in the audit team's opinion, this control, once implemented, did help mitigate the risk that resources that worked and billed time on the contract could be removed in error. This control, while not currently required, could be considered in future contracts.

Given the volume of added resources (148 contractor resources were added using contract amendments) and the short time span in which they were processed due to the accelerated pace of the contract, it was reasonable to expect that some errors could occur. Since these exceptions did not have a significant impact on the overall contract, management's processes over contract amendments were found to be adequate by the audit team.

Task Authorizations

Task authorizations could be raised under the contract by the 67 departments and agencies involved in the Strategic and Operating Review to access the contractor's services on an "as and when requested" basis for specific tasks outlined in the contract. As a result, we expected that administrative processes would be put in place to enable the appropriate request and approval of task authorizations, including a process to ensure that the scope of raised task authorizations conformed to the contract and overall Strategic and Operating Review objectives.

A total of 27 task authorizations were raised over the duration of the contract from 16 different departments and agencies for work to support independent advice to ministers and senior public administration leaders.

A judgmental sample of ten task authorizations from eight different departments and agencies was selected for testing, six of which were the highest valued and the remaining four were randomly selected. The sample selected for testing represented 78 per cent of the total value of the task authorizations.

We found that the processes for raising task authorizations were effective. Task authorization documentation was complete and included the required forms and statements of work, as outlined in the formally defined process. Also, we found there was an adequate review process in place in which key stakeholders were consulted to ensure the statement of work was in the scope of the contract and in line with Strategic and Operating Review objectives. Those consulted included the Secretariat's Contracting and Procurement unit, the Expenditure Management Sector, relevant program sectors, and the initiating department.

We found that all task authorizations and relevant amendments were approved by the project and contracting authorities as required, with some minor exceptions to this process as noted below. The process for raising task authorizations included a requirement for approval and sign-off by the initiating department's or agency's deputy minister, the project authority, and the contracting authority (for authorizations valued at more than $400,000) prior to the commencement of work on the task authorization. Also, amendments to task authorizations that changed the scope of work and value had to be signed by the deputy minister.

The three minor exceptions noted in the task authorization process were subsequently addressed by management: one resource worked and billed time on a task authorization without proper prior approval (the contractor subsequently gave the Secretariat a credit for this billed time); one amendment to a task authorization, which related to an extension of timelines, was not signed as required by the contracting authority prior to its issuance (the amendment was subsequently signed); and an inconsistency was found in amendment approvals—an amendment for a task authorization that de-scoped work and decreased the task authorization value was not signed by the Deputy Minister, although we were advised that verbal approval from the Deputy Minister for the amendment was received.

Security Requirements and Protection of Information Assets

The contract involved many internal and external resources, as well as the transfer of sensitive and classified information between these various parties. As a result, we expected that security requirements would be identified for all external resources and that required security clearances and non-disclosure agreements would be in place. Also, we expected that processes and controls for the protection of information would be put in place in accordance with applicable standards.

We found that processes were in place to protect information assets and to identify security requirements, including obtaining security clearances and non-disclosure agreements.

The protection of information assets was a shared responsibility of the contracting authority, the project authority, the departments and agencies, and the contractor due to the wide scope of the contract and the transfer of information between parties. To ensure a common understanding of requirements, the contractor received briefings on security and information classification. Common procedures for the secure transmission of deliverables were also established. Furthermore, required facility clearances and document control procedures were established by the contractor.

The project authority followed existing procedures with respect to security clearance processes established at Public Works and Government Services Canada for contractors and contractor facilities. In this respect, the project authority was not directly involved in the security clearance processes between the contracting authority and the contractor.

The short duration of the contract and the high volume of external resources led to a need for management to balance timely contract delivery with the mitigation of security risks. Security clearances obtained by Public Works and Government Services Canada were accelerated through the use of verbal confirmations between security organizations, interim clearances, attestation letters, and negotiations with external parties involved in clearances.

Contract Documentation

Although the contracting authority had ultimate responsibility for maintaining the official contracting file, we expected that the Secretariat would maintain adequate contract documentation for contract deliverables and day-to-day contract administration activities.

We found that management adequately maintained contract documentation. Specifically, we found that the Secretariat's Contracting and Procurement unit maintained the Secretariat's contracting file in accordance with the department's draft standard operating procedures. Also, the project management group maintained the formal records of deliverables and contract administration documentation. Finally, management indicated that at contract close out, contract files within the Secretariat will be aggregated.

Conflicts and Disputes

To ensure the smooth progress of the contract, we expected processes would be in place to effectively resolve any conflicts or disputes that could arise.

We found that management adequately resolved issues that arose throughout the contract period. As described in section 3.1, the defined project governance structure facilitated the resolution and escalation of issues to the appropriate levels of management. A review of records of discussion showed issues raised and resolved, with none outstanding noted. These issues mainly pertained to the interpretation of the contract for payment terms, including billable time. Consultation with the contractor confirmed that no outstanding issues existed as of the end of the examination period.

Overall, we found that administrative processes were in place to effectively manage the contract to comply with applicable policies, to safeguard assets and to manage change.

3.5 Overall Conclusion

We conclude with a reasonable level of assurance that the management control framework over the administration of the contract for the Strategic and Operating Review was adequate and effective, specifically:

  • Roles, responsibilities and accountabilities with respect to the administration of the contract were clear and communicated, with a strong governance structure in place;
  • Relevant information on the contractor's performance was gathered and used in the management of the contract to ensure the achievement of deliverables;
  • Processes and procedures were in place and were applied to ensure that funds were being used for their intended purpose; and
  • Administrative processes were in place to effectively manage the contract to comply with applicable policies, to safeguard assets, and to manage change.

Since this audit found no major deficiencies, there are no recommendations outlined in this report.

Appendix A: Roles and Responsibilities

The following table summarizes the key groups involved in the administration of the contract.

Organization Sub-Organization / Position Description
Treasury Board of Canada Secretariat Assistant Secretary, Corporate Services Sector, and Chief Financial Officer
  • Delegated project authority for the contract and, as such, was the Secretariat's legal representative, for whom the work was carried out under the contract.
Project Management Group
  • Led by an executive director, it supported the Assistant Secretary, Corporate Services Sector, in her role as project authority.
  • Responsible for day-to-day management of the contract, including communication, financial management, coordination and monitoring of the contract.
Expenditure Management Sector
  • The sector's Strategic Reviews and Expenditure Policy Division was responsible for the coordination of the cost-reduction proposals of the Strategic and Operating Review on a government-wide level.
Office of the Comptroller General
  • Lead for the following horizontal core areas:
    • Procurement; and
    • Capital Asset Management.
Government Operations Sector
  • Sub-lead in the Office of the Comptroller General's procurement horizontal review, specifically for the military procurement component.
Chief Information Officer Branch
  • Lead for the following horizontal work area:
    • Information Technology Services Consolidation.
Contracting and Procurement
  • Procurement authority within the Secretariat, who provided advice and guidance on procurement-related matters.
  • Liaison between the Secretariat and Public Works and Government Services Canada (contracting authority).
Security Services and Departmental Security officer
  • Provided direction, advice, and guidance related to security for contractor resources working at the Secretariat's premises, and issued official access.
  • Accepted Visitor Clearance Requests for the contractor's US resources.
Public Works and Government Services Canada Supply Specialist, Acquisitions Branch, Public Works and Government Services Canada
  • Contracting authority.
Canadian and International Industrial Security Divisions
  • Provided advice and guidance on security-related matters and granted or verified security clearances of contractor resources.
  • Granted the contractor's facility clearance.
Other Government Departments  
  • Departments and agencies scoped in as part of the Strategic and Operating Review developed departmental cost-reduction proposals to reduce operating budgets through the review of Direct Program Spending.

Appendix B: Audit Criteria

The audit criteria were derived from the Office of the Comptroller General's Audit Criteria Related to the Management Accountability Framework: A Tool for Internal Auditors.

Line of Enquiry 1: Roles and Responsibilities—Roles, responsibilities, and accountabilities with respect to the administration of the contract are clear and communicated.

  1. Roles, responsibilities, and accountabilities within the Secretariat are clear and communicated.
  2. The Secretariat's roles, responsibilities, and accountabilities in relation to external parties are clearly defined and communicated.

Line of Enquiry 2: Performance Management—Relevant information on the contractor's performance is gathered and used in the management of the contract to ensure the achievement of deliverables.

  1. Management has identified appropriate contract performance measures for the contractor linked to planned deliverables.
  2. Management monitors actual contract performance against planned results.

Line of Enquiry 3: Financial Oversight—Processes and procedures are in place and are applied to ensure that funds are being used for their intended purpose.

  1. Processes and procedures are in place and applied to ensure compliance with the Financial Administration Act.
  2. Appropriate and timely financial reporting is communicated internally and externally.

Line of Enquiry 4: Administration—Administrative processes are in place to effectively manage the contract to comply with applicable policies, to safeguard assets, and to manage change.

  1. Administrative guidelines and procedures that are aligned with government-wide policies and expectations have been defined and implemented for the contract.
  2. Information assets are protected.
  3. Administrative processes are updated when required, and these changes are communicated on a timely basis.
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