Report on Recipient Audit Performed on Pikangikum First Nation
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Name: Pikangikum First Nation Location: Ontario Population: 2,643 on reserve; 2,762 total registered Default status at time of audit: Not in default Current default status: Not in default Current Chief: Dean Owen Time period covered by audit: April 1, 2011 to March 31, 2013 Amount of AANDC funding audited: $30,121,042.92
Indigenous and Northern Affairs Canada (INAC), formally known as Aboriginal Affairs and Northern Development Canada (AANDC), selected Pikangikum First Nation in Ontario 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 Pikangikum 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 January 27, 2014 to February 7, 2014. The audited amounts detailed in the audit report present fairly, in all material respects, the costs eligible for the period of April 1, 2011 to March 31, 2013 under the financial terms and conditions of the Funding Agreement and its amendments.
The procedures performed identified that internal financial control processes are mostly in place, and well managed. There are, however, a few procedures that identified control weaknesses within governance, program administration, and financial management. Addressing these internal controls will strengthen how the Recipient manages and allocates it funds in accordance to the agreement. 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 funded by INAC. It is recommended to formalize the departmental organizational charts and jobs descriptions to support overall accountability. To support transparency it is recommended to document council meeting minutes. Pikangikum First Nation's band administrator should consider reviewing and updating the Band's Personnel Policy and Procedure Manual periodically. They should also develop and implement a Financial Policy and Procedure Manual.
The procedures performed also identified the following observations and areas of improvements with respect to Band financial management procedures. Pikangikum First Nation's management and administration should improve their internal controls and accounting processes by centralizing this finance function. The recipient should ensure that the bank reconciliations and employee time sheets are approved by the band administrator as evidence as being approved. Chief and Council should ensure that INAC reports are completed and submitted in a timely manner.
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 Pikangikum 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.