Report on Recipient Audit Performed on Mushuau Innu First Nation
Name: Mushuau Innu First Nation
Population: 883 on reserve; 954 total registered
Location: Labrador
Default status at time of audit: Recipient Appointed Advisor
Current default status: Recipient Appointed Advisor
Current Chief: Chief Gregory Rich
Time period covered by audit: April 1, 2010 to March 31, 2012
Amount of AANDC funding audited: $14,072,669
Background
Indigenous and Northern Affairs Canada (INAC), formally known as Aboriginal Affaires and Northern Development Canada (AANDC), selected the Mushuau Innu First Nation in Labrador, Atlantic Region, for a recipient audit based on its 2011-2012 risk assessment results 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 2010-2011 and 2011-2012 Funding Agreements. The objective was achieved through:
- Examination of the effectiveness of the operations of the Financial Management Control Framework in place at the Mushuau Innu 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 Management Canada Ltd, an independent audit firm, was commissioned by INAC to undertake the recipient audit. The audit procedures were performed from February 26, 2013 to March 1, 2013. The auditor was unable to express an opinion on the eligibility of the expenses claimed by the recipient as they were unable to determine which expenses are related to which Funding Agreements.
Findings
The procedures performed identified that internal financial control processes are not properly put into place for program administration, financial management, and report systems. As a result, some of the expenditures examined as part of the recipient audit did not comply with the terms and conditions of 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 opportunities to improve governance in support of programs funded by INAC. In order to effectively manage programs, it is recommended that the recipient staff key positions that are vacant. The recipient should take minutes of all Chief and Council meetings to maintain a record of decisions made. The recipient should develop policies and procedures supporting the delivery of programs.
Band Management
The procedures performed also identified the following opportunities for improvements with respect to Band financial management procedures. It is recommended that the recipient realign its chart of accounts to ensure that it adequately supports INAC reporting requirements. A key recommendation is that the recipient should record an invoice when goods have been received or the services rendered. This will ensure more accurate reporting and being able to manage invoices better.
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 Mushuau Innu 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.