Report on Recipient Audit Performed on Keeseekoose First Nation

Background

Indigenous and Northern Affairs Canada (INAC), formally known as Aboriginal Affairs and Northern Development Canada (AANDC), selected the Keeseekoose First Nation in Saskatchewan for a recipient audit based on their 2012-2013 risk assessment score and other risk factors.

The objective of the recipient audit was to provide assurance that funding provided to the recipient by INAC was spent for its intended purposes and is in compliance with the terms and conditions of the 2011-2012 and 2012-2013 Funding Agreements. The objective was achieved through:

• Examination of the effectiveness of the operations of the Financial Management Control Framework in place at the Keeseekoose First Nation;
• Conduct of audit procedures on the eligibility of the expenditures claimed under the terms and conditions of the Funding Agreements with INAC.

Spearhead Canada Management Ltd, an independent audit firm, was commissioned by INAC to undertake the recipient audit. The audit procedures were performed from March 10, 2014 to March 14, 2014. The audit was not completed successfully as the recipient failed to provide supporting documentation to substantiate their expenses. The auditor gave a qualified opinion on the audit. The management framework currently in place is insufficient to support the delivery of the Programs and is not in accordance with the Terms and Conditions of the Agreements.

Findings

The procedures performed identified that internal financial control processes are not properly put into place for program administration, financial management, and reporting systems. As a result, the recipient was unable to manage program expenditures in accordance to the Funding Agreements. The following are some key findings and key recommendations identified in the audit report.

Governance by Chief and Council

The procedures performed identified areas where there are opportunities to improve governance and administration in support of programs that are funded by INAC. It is recommended that that the recipient develops an organizational chart which allows staff to have a better understanding of the roles and responsibilities of each position thus promoting staff accountability. It is recommended that recipients develop a standardized process to approve changes to work plans. The recipient should ensure that policy manuals are reviewed and approved by Chief and Council on a regular basis.

Band Management

The procedures performed identified the following areas for improvement with respect to Band financial management procedures. Chief and Council should provide formal work-related training so that staff are able to perform at a higher level at their jobs. To promote accountability, Chief and Council should develop annual budgets by program and share it with staff. They should also implement a budget monitoring process to see how much funds are remaining and to track expenditures. The recipient should be completing the bank reconciliations on a timely basis and getting it approved by Chief and Council.

Current Status

A copy of the final report has been sent to the recipient. INAC and the recipient are working together to address the findings.

Disclaimer: This audit summary was prepared based on information contained in a Recipient Audit Report on Keeseekoose First Nation for INAC. The report produced for INAC is intended solely for the information and use of the Recipient and INAC Management. The audit summary only presents limited information on the general findings based on the audit procedures performed and does not provide information on the detailed procedures of findings. Consequently, this summary may not be appropriate for the purpose and use of the reader.