Summary Report on Recipient Audit Performed on Sheshatshiu Innu First Nation
Name: Sheshatshiu Innu First Nation
Location: Atlantic
Population: 1,520 on Reserve; 1,714 total registered
Default status at time of audit: Not in default
Current default status: Not in default
Current Chief: Eugene Hart
Time period covered by audit: April 1, 2015 – March 31, 2017
Amount of AANDC funding audited: $11,184,677.05
Background
Indigenous Services Canada (ISC), formally Indigenous and Northern Affairs Canada (INAC), selected the Sheshatshiu Innu First Nation in Atlantic for a recipient audit based on their 2017-2018 risk assessment score and other risk factors.
The objective of the recipient audit was to provide assurance that funding provided to the recipient by Canada was spent for its intended purposes and is in compliance with the terms and conditions of the 2015-2016 and 2016-2017 Funding Agreements with ISC. The objective was achieved through:
- Examination of the effectiveness of the operations of the Financial Management Control Framework in place at the Sheshatshiu Innu First Nation; and
- Conduct of audit procedures on the eligibility of the expenditures claimed under the terms and conditions of the Funding Agreements with ISC.
Spearhead Management Canada Ltd, an independent audit firm, was commissioned by ISC to undertake the recipient audit. The audit procedures were performed from March 5, 2018 to March 9, 2018. The audit was completed and the auditors have examined sufficient evidence to support their conclusion.
Findings
The procedures performed identified certain control weaknesses within governance, program administration, expenditure oversight and financial management that, if well designed and operating effectively, would help ensure that funds spent for their intended purposes are in compliance with the terms and conditions of the Agreement. The following are some key findings and key recommendations identified in the audit report.
Governance by Chief and Council
The audit procedures performed identified best practices and areas where there are opportunities to improve governance and administration in support of programs funded by ISC. The audit identified the following best practices. Sheshatshiu Innu First Nation is governed by a Chief and Council who are elected for a three year term during which they meet every four weeks. Roles and responsibilities of the Chief and Council are described in the Governance manual. However, it is recommended that the Director of Operations submit the updated Policy and Procedure manual to Chief and Council for approval when it is updated. Also, the eligibility and payment of bonuses and performance incentives should be addressed in the Personnel Policy and Procedure, as well as Governance Manuals.
Band Management
The procedures performed identified the following best practices with respect to Band financial management procedures. A best practice that was noted by the auditors was that all cheques examined had two signatures. The Recipient also provided unaudited revenue and expense schedules for each funding model by functional area. To better support the procurement process, a recommendation made, was indicated that Directors should attach rationale to the supporting documentation when there is an absence of formal quotes. In addition, the Director of Human Resources should submit updated employee job descriptions and salary grid to the Chief and Council for approval once it is completed.
Current Status
A copy of the final report has been sent to the recipient. ISC and the recipient are working together to address the findings. In addition, the Recipient was provided with a verbal briefing on the results of the audit.
Disclaimer: This audit summary was prepared based on information contained in a Recipient Audit Report on Sheshatshiu Innu First Nation for ISC. The report produced for ISC is intended solely for the information and use of the Recipient and ISC 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.