Management Letter - Sayisi Dene First Nation

Chief and Council
Sayisi Dene First Nation
General Delivery,
TADOULE LAKE MB R0B 2C0

Ref: 2012-13 Recipient Audit Results and Follow-Up

Dear Chief and Council:

Aboriginal Affairs and Northern Development Canada (AANDC) conducted a number of recipient audits in fiscal year 2012-13, including an audit of Sayisi Dene First Nation. Please find attached a copy of the full audit report and a summary of the report. The summary will be published on the department’s website in the coming weeks, along with this management letter. Should you wish to, you may provide a written response to the audit to me within 30 days. Your response will also be posted.

The audit identified numerous control weaknesses with governance, expenditure oversight and financial management that, if well designed and operating effectively, would help ensure funds were spent for the intended purposes in compliance with funding agreements.

As a result of this audit, a non-compliant amount of $67,381 has been identified and is subject to recovery unless additional evidence is provided within 30 days. A representative of AANDC will contact you shortly to follow up on recovery/repayment arrangements.

The audit report also included the following recommendations, which we advise you and your organization to address:

• The Chief and Council should improve the governance and oversight of the funding provided by AANDC through: documentation of minutes for all Chief and Council meetings and provision of minutes for review by Members, AANDC, auditors and other stakeholders as appropriate; regular review of financial information (quarterly at a minimum, monthly is optimal) to assess actual program and administration expenditures compared to the budgeted amounts; clarification of the roles of Chief and Council should be documented and communicated and should include responsibility to review and approve the annual budget, and to review the actual expenditures compared to the budgeted amounts on a monthly or quarterly basis; and presentation of annual budgets and audited financial statements to Members on a timely basis following their completion.
• The Chief and Council should prepare a strategic plan in order to articulate the objectives of the Band over the next one to three years.
• Band Management should prepare operational plans for all significant programs which may include: Education, Social, facilities O&M and housing, and Band support.
• Band Management should improve the financial administration and management of funding provided by AANDC through: documenting financial policies including the requirements for cash receipts, cash disbursements, accounting and record keeping, and financial reporting (these policies should be communicated and implemented with appropriate training provided as needed); conducting a more thorough and documented review of monthly variance reporting; and providing Chief and Council with financial information on a regular basis that includes budget and actual results with explanations for significant variances over and under budget.
• Band Management should document the cash disbursement process to clearly outline the process and related financial controls that must be followed for the procurement of goods and services and the payment of funds for program expenditures.

Please contact your regional AANDC representative to discuss any questions or concerns you may have about this audit.

Sincerely,

Pamela d'Eon, B. COM, B. ED, MBA
Acting Chief Financial Officer

c.c.: John de Francesco
Scott Stevenson
Anne Scotton
KPMG LLP