Conclusion

WD has accomplished several program milestones since CAF and RInC were announced on January 27, 2009 as part of the federal budget. WD has undertaken sound and expedient steps to design and implement CAF and RInC. WD has established practical and reasonable resources, structures, roles, responsibilities and accountabilities. WD has positioned itself with sound risk mitigation strategies and control frameworks that should enable successful implementation of the CAF and RInC initiatives as introduced in the Economic Action Plan (Budget 2009).

WD needs to focus on developing its new monitoring processes and building that enhanced capacity. As CAF and RInC evolve and actual project spending occurs, future audit testing will focus on those phases of CAF and RInC.

Based on the results of this audit, Internal Audit has concluded the following regarding the key risk and control elements for CAF and RInC covered by this audit.

Risk and Control Element	Assessed Criteria Results
1. Governance and Risk Management	Criteria met
2. Program Design	Criteria met
3. Capacity and Resources	Criteria mostly met
4. Clarity, Eligibility & Communications	Criteria mostly met
5. Reporting and Performance	Criteria met
6. Compliance	Criteria met
7. Financial and Cash Management	Criteria mostly met
8. Partnerships	Criteria mostly met

Audit Strategies and Approach

Planning

Audit planning started in May 2009 and fieldwork was completed in August 2009 in all of the four provinces and headquarters. Pre-engagement meetings and a preliminary survey were completed to facilitate identification of key risks, audit criteria, control elements and audit strategies. WD staff, departmental audit committee and central agency staff were also engaged.

Standards and Methodology

Government of Canada internal auditing standards were used for the audit. It is evidence-based and provides audit assurance that is fully supported. All available evidence has been analyzed considering factors, logic and regional environment; and examined against audit criteria and expectations. Sources of evidence included interviews, risk analysis, verification, regional visits, analytical reviews, elaboration on cause and effect of conditions, background literature, and confirmations as necessary.

Sampling

The identified key risks were prominently considered in judgmentally selecting project files for examination. The auditors judgmentally selected 12 of 55 approved files as at June 20, 2009, as part of the audit evidence. The auditors judgmentally selected 10 files that were not recommended for approval. These 22 sample files were tested against applicable attributes in the audit criteria.

Follow-up Auditing

This is a system-under-development audit for program initiatives that are barely six months old. Based on the current approved risk based audit plan, a subsequent audit will be conducted to cover some of the elements of CAF and RInC that are still under development. This follow up audit is scheduled for 2011-12, which is the year following the completion of both CAF and RInC.

Audit Team

Donald MacDonald     Chief Audit Executive
John Hagan               Project Leader