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Internal Program Audit of the Global Peace and Security Fund

(May 2008)

PDF Version (238 KB)*

Executive Summary

Audit Objectives

The Internal Audit Division (ZIV) undertook an audit of the internal management of the Global Peace and Security Fund (GPSF) program as per ZIV's 2007–2008 annual audit plan. ***.

The objectives of the Internal Audit of the GPSF program were to provide assurance that:

  1. an appropriate management control framework was in place and operating effectively and efficiently; and
  2. the Stabilization and Reconstruction Task Force (START) had complied with the terms and conditions for the GPSF.

Audit Conclusions

Since commencing operations fifteen months ago, the START Secretariat has made significant progress towards implementing an appropriate management control framework. This framework includes the implementation of a program/project approval and review committee structure, the development of an interim information system and the establishment of good working relationships with the Other Government Departments (OGDs) Department of National Defence (DND), Royal Canadian Mounted Police (RCMP), Canadian International Development Agency (CIDA) that it works closely with to achieve a whole–of–government (WOG) approach.

The findings described in this report are consistent with a new program at its infancy. START has made significant efforts to develop appropriate systems and procedures but gaps still remain. It is important at this point that START continues its efforts and places high priority on implementing the recommendations (refer to Appendix B) contained in this report. Implementation of the recommendations will assist DFAIT and START to manage and deliver their projects and provide the financial and risk control environment required to demonstrate prudent and effective management of program funding. It is recognized that a significant commitment of resources is required to ensure the successful realization of all of the recommendations. However, not all recommendations can be implemented simultaneously and will need to be prioritized.

Overall, we conclude that GPSF has an appropriate management control framework in place given that it is in its second year of operations. In addition, we found that START has generally complied with the terms and conditions for the GPSF. However, we point out that implementation of the recommendations made in this report will help to strengthen its management control framework.

Statement of Assurance

In my professional judgment as Acting Chief Audit Executive, sufficient and appropriate audit procedures have been conducted and evidence gathered to support the accuracy of the conclusions and opinion provided and contained in this report. The conclusions are based on a comparison of the conditions, as they existed at the time, against pre–established audit criteria that were agreed with management. The evidence was gathered in compliance with TB policy, directives and standards on internal audit and procedures used to meet the professional standards of the Institute of Internal Auditors.

Governance/Management Structure

The GPSF is managed by the START Secretariat in the context of a whole–of–government approach coordinated through the START Advisory Board (SAB) which is a key component of the governance structure for the GPSF. It is comprised of senior officials from across government.

To date the SAB has operated as a good exchange of information forum; however, it has not assumed the full mandate described for it in the TB submission for the Program. START management recognizes this and is currently taking action to strengthen the role of the SAB. Formal terms of reference for the SAB should be developed and agreed to by the members.

The OGDs on the SAB support the WOG approach for the GPSF and believe DFAIT is the appropriate home for this initiative.

Since the establishment of START, two country task forces have emerged, the Sudan Task Force (FSDN) and the Afghanistan Task Force (DFD). As well a Haiti Steering Committee has emerged. The roles, responsibilities and accountabilities of each of the groups are not clear in terms of the WOG approach nor policy formulation. Those interviewed indicated that there was considerable dialogue and coordination (formal and informal) between the groups; however, they agreed that there is a need for greater clarity and that this should be done in writing. Action should be taken to clarify and document the roles, responsibilities and accountabilities of the Afghan and Sudan task forces, the Haiti Steering Committee and the START Secretariat as it relates to these countries.

The START Secretariat operates in a matrix structure and it is recognized that there are certain advantages in operating in this way and that to a certain extent it works because of the individuals involved. Based on our review and interviews, there is overlap and at the Director level we could not identify clear accountability for the three sub–programs. A review should be undertaken of the current organization structure and management responsibilities associated with the three sub–programs to ensure that roles, responsibilities and accountabilities can be clearly attributed and articulated. In this process, consideration should be given to managing and reporting at the Program level rather than at the sub–program level.

Human Resource Management

By far, the most pressing Human Resource (HR) management issue facing START is its capacity to attract and maintain staff. The perception in DFAIT that program/project management is not a mainstream activity continues to hamper the recruitment and retention of staff. At present, officers in START are expected to perform both a policy function and deliver programs and projects; these activities require different skill sets. This dual role makes it difficult to balance and effectively manage projects.

With a view to ensuring efficient and effective program/project delivery and enhancing its capacity to staff both the policy and project management functions with appropriate skill sets, START should review its current structure where both the policy and delivery functions are vested in one individual. START should also consider establishing a unit dedicated to program/project delivery.

Project Management training has been identified as an essential requirement. A course was developed by the Program Services Division (IXS) to meet the specific needs of project officers in the International Security Branch (IFM). Initially the response to the course was positive and take–up was good, but at present there are no plans to offer the course. There is no systematic plan to address the critical needs of new project officers in a timely way. START should develop a comprehensive training and development plan and formal training plans should be developed for all staff.

Planning and Budget Management

Longer term strategic planning has been hampered by the lack of a long term funding commitment by Treasury Board. *** No overall multi–year strategy for a WOG approach to integrate conflict prevention, crisis response and stabilization initiatives with respect to failed and fragile states has been developed. Therefore, it is not possible for START to monitor, measure progress and report on the achievement of results against an approved strategy.

When funding for the program is normalized and when preparing the Corporate Business Plan, START should conduct an annual in–depth analysis of the results it intends to achieve and the resources it will require to achieve these results over the ensuing three years.

Operational and work planning are generally informal, a detailed budget and work plan should be prepared prior to the commencement of each fiscal year and monitored on a quarterly basis.

Project Management

The detailed review of a sample of project files highlighted that overall, there are good processes and structures in place with respect to the management of GPSF projects. Committees have been set up to review and approve projects to ensure sufficient consultation among stakeholders. The procedures involving payment processes are being followed including obtaining authorized signatures, making payments, and collecting refunds on a timely basis. In a majority of the project files that we reviewed, we noted that key documentation was kept in files. In the Standard Operating Procedures (SOPs), there are general processes outlined as well as numerous templates to encourage consistency and standardization within GPSF. We acknowledge that START is in the process of updating their SOPs recognizing the need to develop a more comprehensive reference and training tool.

While good project management practices are in place throughout the life cycle of projects, we noted areas for improvement. For example, proposals are not received in a central location but usually by individual project officers. Also, project officers lack the financial knowledge needed to adequately assess budgets and financial reports. Contributions of small dollar value go through the same lengthy approval process as those of large dollar value. Project officers should be provided more guidance with respect to environmental assessment processes, project monitoring procedures, and file completion procedures.

Risk Management

In March 2007, an IFM Risk Profile and Strategy Report was prepared for the Branch by Public Works and Government Services Canada (PWGSC). The report identified the major risks that need to be managed in IFM including the GPSF. We were unable to find any formal evidence that the report has been approved as IFM policy or that the actions outlined in the report are being implemented. IFM senior management should formally consider the Risk Profile and Strategy Report prepared by PWGSC and formally issue the current or a revised version of the report.

At the project level, we found that efforts are made to identify risks and mitigation strategies during the project development stage. We feel this risk assessment process is not thorough enough and that the risk statements are too general in nature to be an effective management tool. We found little evidence of monitoring and follow–up of the identified risks through the life cycle of the project. There is confusion between what constitutes risk management and what constitutes good management practices. Steps should be taken to strengthen the process including developing comprehensive policies and guidelines for staff based on TB policies and best practices. Training of staff in risk management practices should be considered a high priority.

Information Management

As pointed out in previous audit reports, there is no Corporate Integrated Project and Financial management System in DFAIT for the management of grant and contribution programs. In an attempt to address the absence of a Corporate System, START has developed a stand alone MS Access database. At the time of the audit, the system was still a work–in–progress: data entry is incomplete; the quality of the data is inconsistent; and there is limited reporting capacity. There is considerable duplication of effort. Three sets of books are being maintained which need to be continuously reconciled with the official Departmental system.

IXS is currently participating with Information Management and Technology Bureau (SXD) to identify a solution to support DFAIT's grant and contribution programs. SXD has indicated that a first program would be ready to pilot in the new fiscal year. It is critical that a Corporate Integrated Project and Financial Management System for the management of grant and contribution programs be implemented as soon as possible. IXS should closely monitor the progress of SXD in achieving the schedule they have outlined, significant deviations should be reported to the ADM, IFM. IXS and SXD should review the schedule with a view to accelerating the process.

Other Findings

This report contains other findings and recommendations which will require the attention of senior management. While they are not highlighted in the executive summary, they are important to the overall successful management of the GPSF. These include recommendations related to operational and work planning, completion of performance appraisals, governance and information technology.

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1.0 Introduction

Background

In May 2005, the Government of Canada allocated $500 million over five years to Foreign Affairs and International Trade Canada (DFAIT) to establish START and the Global Peace and Security Fund (GPSF). The objective of the GPSF is to deliver timely, coordinated responses to international crises requiring WOG action through the planning and delivery of coherent, effective conflict prevention, crisis response and stabilization initiatives in failed and fragile state situations implicating Canadian interests.

The Government of Canada created the GPSF to close a policy/funding gap and an institutional gap in Canada's ability to provide a timely, integrated package of assistance to countries in crisis. The GPSF responded to this policy/funding gap by creating two new programs, the Global Peace and Security Program (GPSP) and the Global Peace Operations Program (GPOP). It also incorporated under its authority the Human Security Program (HSP), now renamed the Glyn Berry Program (GBP), which had been operating within DFAIT from 2000 to 2005. The Government of Canada created the START Secretariat to close the institutional gap so that Canada could respond to crises with an integrated package of assistance.

The objectives/roles of the GPSF components are as follows:

  • GPSP: To permit DFAIT to plan and deliver timely, coherent responses to peace and security challenges in failed and fragile states, including conflict prevention, crisis response and stabilization initiatives.
  • GPOP: To meet Canada's G8 Sea Island Summit commitment to develop global capacity for peace support operations by funding medium–term initiatives to build local and regional capacity to respond to crises. GPOP focuses largely on enhancing the capacity of regional organizations and countries in Africa to conduct peace operations.
  • GBP: To advance Canadian foreign policy priorities under the Human Security agenda in five specific areas: the protection of civilians, conflict prevention, peace support operations, governance and accountability, and public safety. The first five–year phase of the GBP operated from 2000 to 2005.

The START consists of an Advisory Board and a Secretariat.

The SAB is comprised of senior officials from DFAIT, CIDA, DND, Public Safety and Emergency Preparedness Canada, RCMP, the Privy Council Office and other relevant departments/agencies. Its mandate is to:

  • ensure WOG coherence in policy development and integrated conflict prevention, crisis response and stabilization initiatives with respect to failed and fragile states; and
  • serve as the basic platform for coordinating interdepartmental responses to significant international crises, including those precipitated by failed and fragile states and natural disasters.

The START Secretariat, situated within the IFM of DFAIT, is charged with supporting the SAB. The Secretariat does so through the provision of rapid analysis, reporting and response/programming capabilities in crisis, post–crisis stabilization and peace building situations. The START Secretariat is responsible for overall program management of the GPSF, including the establishment of appropriate controls, reporting and administrative procedures, as well as setting the scope of resources available for specified priorities:

  • achieve greater speed, effectiveness, integration and coherence in Canada's response to international crises, including those failed and fragile states and natural disasters;
  • serve as an interdepartmental body within the Government of Canada to define priorities, and provide strategic coordination, for conflict prevention, stabilization, reconstruction and peace building;
  • provide the institutional locus for sharing information and joint priority setting to ensure complementarity and a WOG approach;
  • act as the interdepartmental body for the management of Canada's response to international crises; and,
  • assemble expertise across government as well as relevant expertise outside of government, if required.

The GPSF programs deliver programming through funding to:

  • OGDs and crown corporations;
  • Canadian non–governmental organizations (NG0s), universities and research institutes;
  • international non–governmental organizations (INGOs);
  • regional and international organizations and research institutes; and
  • private sector experts and organizations.

***

The following table details GPSF's expenditures to date.

DateGrants and Contributions
(Vote 10)
Operations
(Vote 1)
Total Expenditures
Oct 05 to Sep 06 HSP Terms and Conditions$20.7 M$2.0M$22.7M
Oct 06 to Mar 07 GPSF Terms and Conditions$46.8M$8.9M$55.7M
Apr 07 to Mar 08 GPSF Terms and Conditions$193.8M
(planned)
$10.1 M
(planned)
$203.9M
(planned)

The GPSF is among a number of new initiatives at DFAIT that are challenging the department as it shifts its orientation from mainly policy and operations to policy, operations and programming. The change requires new sets of skills and expertise within the department. It also requires program management and administrative systems for strategic and human resource planning, project selection and approval, monitoring, financial management and capturing and reporting on results.

Objectives, Scope and Criteria

The objectives of the Internal Audit of the GPSF program were to provide assurance that:

  1. an appropriate management control framework was in place and operating effectively and efficiently; and
  2. the Stabilization and Reconstruction Task Force (START) had complied with the terms and conditions for the GPSF.

This internal audit also satisfies the requirement in the RBAF for the GPSF that an internal audit be conducted. ***

In order to determine the appropriateness of the management control framework in place, the scope of the audit included the following seven management areas:

  • Governance – application of the governance structure provided for in the approved RBAF;
  • Management Structure – accountabilities, authorities, roles and responsibilities are understood and applied;
  • Human Resource Management – staffing, training, skill sets, planning, allocation and functional support;
  • Planning and Budget Management – strategic, business (operational), work planning and monitoring and adjusting;
  • Project Management – appropriateness of the SOPs, their use and the application of sound project management practices;
  • Risk Management – the TBS, Integrated Risk Management Framework is being applied and the identified risks are being regularly reviewed; and
  • Financial Administration Practices – test compliance with the requirement of the Financial Administration Act (FAA), Transfer Payment Policy, DFAIT practices and policies.

Audit criteria for the first objective were established for each of the seven areas, as outlined in AppendixA.

Audit criteria for the second objective relate to the terms and conditions for a class of contributions for sub–programs supported by the GPSF, as outlined in a table on page 25. Since only one grant was disbursed in fiscal year 2006–2007 and it was not included in our sample of project files reviewed, we did not use the terms and conditions for grants as criteria in our audit.

Methodology

The audit methodology consisted of interviews with START personnel and other applicable departmental staff, Central Agency staff, and representatives from OGDs, reviewing documentation and carrying out appropriate analyses. More specifically, the audit methodology included the following key elements:

  • documenting and assessing the cost–effectiveness of key business processes;
  • reviewing Central Agency, departmental and START policies, manuals, guidelines and procedures (e.g. SOPS);
  • developing internal control questionnaires;
  • documenting (i.e., flowcharts + narrative description) and assessing the adequacy of the internal control framework;
  • reviewing project approval, planning, monitoring and reporting documentation.
  • testing key internal controls;
  • reviewing management and performance reports;
  • meeting with selected members of the START Advisory Board;
  • meeting with staff of the functional support areas (Finance, Human Resources);
  • reviewing documentation provided by partner organizations;
  • holding periodic meetings with IRD and ZIV Management to apprise them of the audit's progress and to discuss findings noted and possible solutions; and
  • reviewing GPSF recipient audit results.

The documentation review and interview phase of the audit took place between August and November 2007.

Forty–seven individuals were interviewed including the management and staff of START, representatives from the functional support areas (Finance and Human Resources), Area Management Office (IAM), International Assistance Envelope (IAE) management, Treasury Board Analyst and OGD members of the SAB.

In order to assess the quality of the management of project files, a sample of 27 project files were reviewed. A cross–section of files was chosen to ensure that the sample was representative of the total population (those files that were active at one time during the period from September1, 2006 to March31, 2007) such as from various divisions, a variety of project officers, different recipients as well as small, medium and large value contribution amounts.

The various stages of a project cycle (i.e. application, approval, contribution agreement, payment, monitoring and reporting) were reviewed in addition to the quality of document management. A follow–up with each project officer was conducted in order to clarify matters and gather further information based on the examination of project files. In addition, another 25 to 30 project files that had the same implementing recipients as the sample of 27 project files were reviewed to ensure that there were no overlapping activities.

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2.0 Findings and Recommendations

Objective 1:

To provide assurance that an appropriate management control framework was in place and operating effectively and efficiently.

In order to meet our objective, we reviewed the following areas:

  • governance/management structure;
  • human resource management;
  • planning and budget management;
  • project management;
  • risk management;
  • information management; and
  • communications.

Overall, we conclude that GPSF has an appropriate management control framework in place given that it is in its second year of operations. We describe our findings in each area in more detail below.

Governance/Management Structure

The GPSF is managed by the START Secretariat in the context of a WOG approach coordinated through the SAB. Chaired by the Director General of the START Secretariat and comprising of senior officials from across government (RCMP, DND, CIDA, Justice Canada), the SAB is responsible for establishing WOG strategic policy, priority–setting and direction with respect to failed and fragile states and complex emergencies within the framework of individual departmental authorities, as well as providing a platform for information exchange on program–related activities to ensure complementarities and avoid duplication. The START Secretariat is lead by a Director General, accountable to the Assistant Deputy Minister, IFM, and is responsible for the financial, human resources and physical resource services for START.

The START secretariat consists of an Executive Office (IRD) which includes the Director General and a Senior Director. There are four policy and programming divisions: IRC; IRH; IRP; and ILX. Each of the divisions is lead by a Director.

There are two formal committees operating within START: The Program Planning Committee (PPC) chaired by the DG; and the Project Development and Management Group (PDM) chaired by the Senior Director. The PPC's mandate is to review project concept papers over $500K and to provide overall direction in the planning of the proposed projects. The PDM's mandate operates primarily as a technical review committee. Both committees have appropriate representation from both START and other stakeholders in DFAIT in particular from the geographic bureaus.

Since the establishment of START, two country task forces have emerged, the FSDN and the DFD. As well a Haiti Steering Committee has emerged which is co–chaired by DFAIT/RHL and CIDA. The three groups have indicated that they each have a mandate to coordinate the implementation of a WOG approach in their respective countries.

***

The OGDs support the WOG approach for the GPSF and believe DFAIT is the appropriate home for this initiative. They also stated that there is a good working relationship with their colleagues in DFAIT.

The OGDs also indicated that the level of representation at the meetings was inconsistent, that the DG level was appropriate and that the meetings should be conducted in such a way that it is the DGs that speak on behalf of their Department/Agency. They also stated that the overall governance/committee structure and the participation at the Deputy Minister and Assistant Deputy Minister committee level should be broadened to include other Departments as well as CIDA.

Based on the interviews conducted with representatives from the Task Forces, the Haiti Steering Committee, and START management, the roles, responsibilities and accountabilities of each of the groups are not clear both in terms of the WOG approach and policy formulation. In an audit report entitled "Managing Horizontal Initiatives" the Auditor General made the following comment "Success in this type of undertaking starts with a clear picture of who's in charge, who does what, and what expertise they bring to the table". Those interviewed indicated that there was considerable dialogue and coordination (formal and informal) between the groups; however, they agreed that there is a need for greater clarity and that this should be done in writing. In some cases, draft TORS have been prepared but have not been finalized.

The START Secretariat operates in a matrix structure and it is recognized that there are certain advantages in operating in this way and that to a certain extent it works because of the individuals involved. Based on our interviews with START management, and staff and our review of various documents, bureau roles, responsibilities and accountabilities are not clear between the divisions. There is overlap and at the Director level we could not identify clear accountability for the three sub–programs. For example, GBP funds are used by eight different divisions, while there is clear accountability for payments (IRD Senior Director), two people are perceived by interviewees as the lead for GBP (IRD Senior Director and the Senior Program Officer, Human Security Policy Division (GHS). Further, within the 14 envelopes identified for the GBP for 2007–2008, eight divisions have been identified as being responsible for at least one envelope (with two envelopes being co–led by two divisions). The nature of the responsibility and the accompanying accountabilities has not been clearly defined. Another example of lack of clarity in accountabilities is the Haiti envelope which is led by IRC, whose director signs all payments related to Haiti; however, several of the Haiti projects are managed by officers in IRP who report and are accountable to the Director of IRP. Where ultimate accountability lies in this case is unclear.

The Executive Office is responsible for providing functional oversight and guidance, but also has programming responsibilities. There should be a clear distinction between these roles.

At this point, the Bureau level Management Committee weekly meetings are essentially an exchange of information.

We found that the PPC and PDM committee structure is appropriate and working reasonably well given the current stage of project management knowledge in the Bureau. However, there is evidence that the time and effort required to process projects through the committees is onerous. In particular the need to return to the PDM on several occasions for the same project creates stress and time delays in the approval process that should be avoided.

Recommendations
  1. ***
  2. The overall governance/committee structure at the Deputy Minister and Assistant Deputy Minister level should be reviewed to ensure appropriate representation at this level by the OGDs.
  3. Action should be taken to clarify and document the roles, responsibilities and accountabilities of the Afghan and Sudan task forces, the Haiti Steering Committee and the START Secretariat as it relates to these countries.
  4. A review should be undertaken of the current organization structure and management responsibilities associated with the three sub–programs to ensure that roles, responsibilities and accountabilities can be clearly attributed and articulated. In this process consideration should be given to managing and reporting at the Program level rather than at the sub–program level.
  5. There is a time sensitive need for the Bureau to focus on a number of items requiring functional expertise, therefore it is recommended that the group responsible for functional activities in the Bureau not have any programming responsibilities so that it can devote full time to ensuring that the functional requirements of the Bureau are met.
  6. The role of the Bureau level Management Committee should be strengthened so that it plays a central role in advising the Director General on substantive management issues facing the Bureau. A set of TORs for the committee should be developed. Consideration should also be given to sharing meeting notes with all staff in the Bureau.
  7. The roles and responsibilities of the PPC and PDM committees should be reviewed to ensure that they are operating as effectively and efficiently as possible and that they are operating within a minimum time frame.

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Human Resource Management

At the time of the audit, START's staff complement was eighty–two, comprised of EX's, FS's, ES's, and PM's.

At the Branch level, there is a Human Resource Strategic Plan for 2007–2010. The plan has been endorsed by IFM senior management; however, this has not been formally communicated to staff. The plan provides a good analysis of the issues facing the Branch, but the monitoring plan lacks concrete target dates for completion of actions, strategies and plans.

In START, there is a Human Resource Plan for 2006–2007 which identifies the issues well; however, the action plan associated with the Plan is weak (no time–lines, no one assigned accountability for the individual items) and at this point there is no evidence that there has been a systematic follow–up of the action items. No plan has been developed for 2007–2008 or future years.

Project Management training has been identified as an essential requirement. A course was developed by IXS to meet the specific needs of project officers in IFM. Initially the response to the course was positive and take–up was good, but at present there are no plans to offer the course. There is no systematic plan to address the critical needs of new project officers in a timely manner.

At present there are no individual training plans. We were advised that these are currently being developed based on discussions between management and staff.

There is a Branch level HR Committee which is considered an effective tool for coordinating staffing actions; however, there are other HR issues, such as training, that could benefit from Branch level coordination.

Management has indicated that they provide staff with informal feedback on their performance. They also indicated their agreement that staff should receive formal performance reviews, the Performance Management Plans (PMPs) are not being completed.

Communications between management and staff for the most part takes place informally. Not all divisions hold regular staff meetings.

***. Civilian experts outside of government are identified and managed in collaboration with other organizations such as CANADEM.

While some expert functional services are available to START, such as legal advice, there is clearly a need for additional functional support resources such as expertise in environmental assessments, preparation of contribution agreement wording, finance etc. to support project management.

The IFM, Human Resource Strategic Plan, 2007–2010, identified the need to clarify the roles and responsibilities of financial officers in the branch; at the time of the audit this had not been completed.

By far, the most pressing HR management issue facing START is its capacity to attract and maintain staff. The perception in DFAIT that program/project management is not a mainstream activity continues to hamper the recruitment and retention of staff. At present, officers in START are expected to perform both a policy function and deliver programs/projects. Both of these activities require different skill sets. The continuing staffing freeze and lack of continuing programming authorities is also having an impact on START's capacity to staff and therefore its capacity to carryout the policy function and to deliver program/projects.

Officers in START play a dual role assuming both policy and programming/project management responsibilities. Officers generally perceive programming/project management responsibilities to be administrative in nature and that the policy–related role is more intellectual–oriented. During the interviews, we were told on a number of occasions, because of this perception it is more difficult to attract and retain individuals to work in START. There are administrative functions involved in managing a project such as the opening of files, the inputting of data into the IRD central database, the filing of documents, etc. These administrative duties are essential to managing projects and cannot be avoided or delegated. However, there are key functions that require skill and analysis and cannot be treated as administrative tasks such as the analysis of risks, the review of financial data, the on–going monitoring of the progress of projects and the final assessment of the achievement of objectives and results.

Recommendations
  1. With a view to ensuring efficient and effective program/project delivery and enhancing its capacity to staff both the policy and project management functions with appropriate skill sets, START should review its current structure where both the policy and delivery functions are vested in one individual. In this context, START should also consider establishing a unit dedicated to program/project delivery. The establishment of such a unit would also provide a logical home for any additional functional resources that are required.

  2. START should develop a comprehensive Human Resource plan which should include a review of the number and type of human resources it will require to deliver the planned program. It should also include a comprehensive training and development plan. The plan should be action oriented, include target dates and provide for appropriate monitoring and follow–up.

  3. To ensure all staff receive formal feedback on their performance, START management should fully implement the DFAIT PMP.

  4. Formal training plans should be developed for all staff.

  5. The role of the Branch level HR Committee should be expanded to include other major HR areas such as planning and training.

  6. Prior to any further staffing of Financial Officers taking place, the role of these officers in the Branch should be reviewed to ensure that the roles and responsibilities of the officers both at the Branch and Bureau levels are clear.

  7. At the divisional level, regular formal staff meetings should be held. Minutes of meetings should be kept and made available, as appropriate, to all staff levels.

  8. The requirement for an expert placement unit should be reviewed.

Planning and Budget Management

***

No overall multi–year strategy for a WOG approach to integrated conflict prevention, crisis response and stabilization initiatives with respect to failed and fragile states has been developed. Therefore, it is not possible for START to monitor, measure progress and report on the achievement of results against an approved strategy.

Operational and work planning are generally informal, the exception being the performance objectives agreed to by the members of the EX group as part of their annual performance agreements. Work priorities are discussed at management and staff meetings. They are also discussed during bilateral meetings between staff and managers.

The budgeting process at the sub–program and envelope level is a collaborative process involving the Directors and the other DFAIT stakeholders. We found that the process for allocating both Vote 1 and 10 resources was effective. We also found that the processes used to monitor and control the budgets was effective.

As there is no formal business planning process in place, there is no documented evidence that regular performance monitoring is carried out and adjustments made as the need arises. As the Program grows, planning and operating informally will not be adequate. When longer term funding for the Program is stabilized, taking a long term strategic perspective will ensure that all options and their impacts are being considered and avoid costly adjustments and disruption to the organization's operating environment.

Recommendations
  1. START should adopt a results based management approach by putting into practice its RMAF and RBAF. This would include a comprehensive schedule of planning, programming, monitoring and reporting for all its activities. Responsibility for delivering each component of the schedule should be stated and all staff informed.

  2. When funding for the program is normalized and when preparing the Corporate Business Plan. START should conduct an annual in–depth analysis of the results it intends to achieve and the resources it will require to achieve these results over the ensuing three years. This analysis should include:
    1. A review of the longer term (3 year) priorities, objectives and desired results for the program;
    2. A review, based on the foregoing, of the longer term operating budget requirements (financial and human) of START;
    3. A review of the progress and results being achieved of all operational projects;
    4. A review of the continued relevance and status of any new programs or projects being considered; and
    5. A review of the cash flow requirements for the Program.
  3. The results of this review should be formally documented and shared with DFAIT senior management. It should also serve as the basis to measure START's performance against planned results.

  4. A detailed budget and work plan should be prepared prior to the commencement of each fiscal year. This plan should be monitored on a quarterly basis and the appropriate adjustments made. The plan and review should be results based.

Project Management

The detailed review of a sample of 27 project files and follow–up interviews with the project officers highlighted that overall there are good processes and structures in place with respect to the management of projects under GPSF. In the SOPs, there are general processes outlined as well as numerous templates to encourage consistency and standardization within GPSF.

Application, Assessment and Approval

Applications for program funding are submitted in the form of proposals. These proposals are only accepted if prepared using the GPSF Proposal Sheet which standardizes the structure of proposals facilitating their review as well as providing applicants with the mandatory headings to include.

The majority of proposals are received directly by project officers instead of a central portal. Consequently, not all proposals are logged into the START central database, only those that have the potential to be approved. Since all proposals are not recorded, it is difficult to obtain historical statistics such as the total number of proposals received, the number rejected, the number accepted, the number in each sub–program etc. These statistics will assist the strategic planning process of the program. In addition, the lack of a central portal compels project officers to make a judgement on which division, sub–program and thematic envelope that the proposal would best fit rather than a decision that should be made by the Secretariat.

The proposals are reviewed by project officers to determine their relevance to the mandates and priorities of one of the three sub–programs which have been aligned to the mandates and priorities of DFAIT as well as the WOG. The project officers' assessment of the proposals' fit and relevance are not documented. If the proposals meet criteria, then they are circulated by e–mail to colleagues in GPSF, other relevant colleagues in DFAIT, OGDs and any other relevant stakeholders for review and comment.

On the other hand, for those proposals that are rejected, it is the responsibility of program officers to inform applicants. Normally, the reasons for rejection are due to weak proposals, limited funding available by the program, competing priorities or not fitting within the programs' mandates.

In the meantime, project officers are expected to perform an overall assessment and reference check of recipient organizations in terms of reputation, financial viability and legal existence. However, there are no guidelines on the specific steps to take, the documents to request and the analysis to perform. Even if certain documents are obtained from recipients, such as audited financial statements, previous recipient audit reports, credit check reports etc., project officers lack the training and financial knowledge to perform the necessary analysis.

If the contribution amounts being requested in proposals are $500,000 or more, the proposals are presented to the PPC which is chaired by the Director General and attended by others at the same level in DFAIT. The purpose of this committee is to review the policy rationale of proposals with a large dollar value. Minutes of the PPC meetings are taken and the proposals approved are documented.

All proposals, regardless of contribution value, are presented to the PDM which is chaired by the Senior Director and attended by all relevant stakeholders within DFAIT. The purpose of the PDM committee is to assess the technical merits of proposals. Minutes of the PDM meetings are taken and the proposals approved are documented.

Upon approval by the PDM that the proposals meet GPSF's criteria along with some follow–up questions, proposals are finalized and sent out to all relevant stakeholders internal and external to DFAIT on a no–objection basis implying that if there are no comments received objecting to the implementation of these proposals within 3 business days, then the proposals will move forward to seek formal approval. Based on our review of project files, we found that generally there were no comments made at this stage in the approval process. Consequently, this procedure appears to be redundant since comments are requested from the same stakeholders through an initial e–mail sent prior to PDM approval.

An environmental assessment form is completed to determine if there is any environmental impact by implementing the project. If there could be environmental impacts, then further assessment is required either by an expert hired locally at the project site or based in Canada. However, although completion of this form is mandatory to obtain overall project approval, there are no specific guidelines on how to proceed if there are potential impacts. For example, it is unclear as to who should perform the environmental assessment, which party should pay for it, at what stage of the project this assessment should be performed etc. If there are no impacts, then no further action is required other than being signed and dated by project officers, which was not always done in the sample of project files reviewed.

Approval Memos, along with the relevant documentation such as the proposals, the budgets, the results based performance frameworks, the environmental assessment forms and the risk management checklists, are reviewed by the GPSF Program Manager, a Financial Officer, the Database Officer and then the Director General for final approval.

As described above, the process from receipt of proposals in the official proposal template to the signing of the contribution agreements can be very onerous and lengthy taking on average 8 weeks. Adding to the lengthy approval process is the lack of instruction provided to recipients on how to complete the required templates such as the proposal sheets, the results based management frameworks and the budget spreadsheets. As a result, too much time in the form of frequent communication back and forth with recipients, is spent by project officers guiding them through the completion of these documents. There is little instruction provided to recipients on the nature and depth of information that is required.

Contributions of small dollar value as well as large dollar value go through the same de rigueur to seek approval. The majority of small dollar value contributions are distributed by the GB program funds. If certain processes were alleviated for these smaller projects, these projects could be implemented much sooner possibly making the GB program more attractive to recipient organizations

Recommendations
  1. All proposals should be received through a central portal and then recorded in the IRD central database. The Secretariat can then allocate the proposals to the appropriate divisions depending on the proposals' relevance to the sub–programs and thematic envelopes.

  2. The critical step of assessing proposals against program criteria and mandates should be included in the risk management checklist to demonstrate that it is done.

  3. A dedicated resource should be available to perform the financial analysis that is necessary throughout the various stages of a project from initial proposal to completion.

  4. Detailed step–by–step procedures should be developed to guide project officers on how to have environment assessments done.

  5. Project officers should be reminded that environmental assessment forms should be signed and dated by them even if no assessments are required.

  6. An instruction sheet should accompany the templates provided to recipients explaining the amount and depth of information required in each section.

  7. The procedure requesting comments on a no–objection basis through an e–mail sent to all relevant stakeholders after PDM approval should be eliminated.

  8. Contributions of small dollar value should not have to go through all of the stringent processes as large dollar value contributions.

Agreement and Monitoring

Upon approval of proposals, contribution agreements are drafted by project officers and reviewed by the Grants and Contributions Centre of Excellence, SMFH, to ensure compliance with the Treasury Board Transfer Payment Policy and Contracting Policy. SMFH provides a turnaround time of 5 business days to review contribution agreements. Advice from the legal division, JUS, is sought when necessary. The final contribution agreements are signed by the recipients as well as the Senior Director of IRD.

Based on our review of a sample of project files, amendments to agreements were completed when required and documented appropriately. The necessary reviews and approvals were performed depending on the nature of the amendments such as an extension of time, an adjustment in funding or a modification of project activities.

In the sample of project files reviewed, all contribution agreements were signed by the authorized signing authority, the Senior Director of IRD. However, at times when colleagues with Acting authority signed on behalf of the Senior Director, the signatures were not legible and there was no identification of who the signatory was.

All contributions agreements include a standard clause stating that interest earned on advances should be reported on the financial reports submitted to DFAIT. We noted that there is no line item on the financial reports prompting recipients to report the interest earned and there is no follow–up done by project officers requesting this to be shown.

Monitoring the progress of projects towards the achievement of its objectives is essential throughout the period. Monitoring can be done in the form of reviews and analysis of interim narrative and financial reports, site visits by project officers or Mission staff, and maintaining frequent telephone or e–mail communications with the recipients. Our review of a sample of project files revealed that monitoring practices were inconsistent. For instance, the methods and results of monitoring were not always apparent and documented in the files. Based on follow–up interviews with project officers, we understand that various monitoring practices were exercised such as site visits or reviews of reports. However, the reports relating to site visits were not in the project files and in most files there was no evidence of detailed reviews of the financial and narrative reports.

After project completion, final narrative and financial reports are submitted by the recipients. Evidence of review of these reports was not always apparent. In addition, there is no subsequent reporting requirement of the achievement of project objectives and results. Certain project officers input results data into the central IRD database at the end of projects while others do not.

In certain projects in our sample, we noted a lapse of funds. Inconsistent practices relating to documenting the reasons for the lapse were apparent. The reasons were either documented in the form of e–mail communications, notes to file or not documented altogether.

We understand that the START Secretariat informed its team of shorter project deadlines in order to close out activities prior to fiscal year end. The following deadlines relate to most contribution agreements with the exception of contribution arrangements with the United Nations and Memorandums of Understanding:

  • March 15: end of project activities
  • March 21: return of any lapsed funds by recipients & receipt of final financial and narrative reports
  • March 31: final payments to be issued
  • April 30: expiry date of contribution agreements

Based on past experience, funding for the GPSF program has been received after the first quarter and sometimes near the end of the second quarter of a fiscal year. Given the receipt of funds so late in the fiscal year, the project cycle is condensed into a short time period between 3 to 6 months. As a result of the deadlines imposed above, project activities will be constrained augmenting the pressure on recipients to achieve their objectives and prepare reporting documentation in a shorter time frame. This will have a negative impact on the quality of activities performed by recipients as well as the quality of review and assessment conducted by project officers.

Recommendations
  1. When persons with Acting authority sign on behalf of the Senior Director, their names should be printed alongside their signatures in order to clearly identify themselves.

  2. The START Secretariat should provide guidance to project officers on how to enforce the clause relating to interest earned on advances in contribution agreements.

  3. In order to encourage consistent monitoring practices, project officers should be given guidance as to the various methods of monitoring, the types of projects that warrant various types of monitoring and the method in which the monitoring activities should be documented. The SOPs would be the best forum to outline these details. In addition, all monitoring activities should be formally documented.

  4. To perform adequate analysis of financial documents provided by recipients, project officers should be given the appropriate training to be able to perform a basic level of financial analysis.

Payments

Upon the signing of contribution agreements, the Financial Officer creates commitments in IMS. Payment requisitions are prepared by project officers, approved by the appropriate authority and then allocated a financial coding by the Financial Officer. Then, they are forwarded to the Area Management Office for payment processing.

In our sample of project files, all payments under Section 34 of the Financial Administration Act were signed by parties who had appropriate authority. However, at times when officers with Acting authority signed on behalf of those persons, the signatures were not legible and the signatories were not identified.

Recipients have to formally request their next payment upon submitting their interim narrative and financial reports. Normally, three payments are made, an initial advance if agreed upon by both parties, one or two interim payments depending on the total value of the contribution and the period of the project, and a final payment representing a 10% holdback of the total contribution amount. In our sample of project files, copies of payment requisitions were kept on file, requests for subsequent payments were made by recipients upon submitting their interim reports and holdbacks were paid after completion of projects were deemed to be successful by project officers based on the final reports.

If all of the funds remitted to the recipients are not needed, then there are amounts owing to DFAIT. In these cases, the Financial Officer informs the Area Management Office to set–up accounts receivable amounts in IMS and to send invoices to recipients. The Financial Officer ensures that the amounts owing are received and informs the project officers. Based on our review, there is a good process in place to ensure that amounts owing to DFAIT are recorded and collected in a timely manner.

File Documentation

To ensure consistent file documentation practices, document checklist forms that guide project officers on the key documentation requirements were sometimes kept on file. Similarly, risk management checklist forms that guide project officers on the steps required to be performed throughout a project as well as a list of the key documentation to be retained in files upon completion, were generally used and retained in files. However, we noted that the two checklists have overlapping areas and the name of the risk management checklist is misleading as it includes several areas of review not only risk management. The consistent use of an appropriate checklist would allow project officers to readily know the status of files as well as facilitate the transfer of files among themselves when necessary.

Based on our review of 27 project files, file documentation practices were found to be inconsistent. In a majority of the files, all of the key documents were included such as the proposal sheets, the results based management frameworks, the budgets, relevant communication with recipients, the contribution agreements, the payment requisitions, any amendments, and the interim and final reports. However, the manner in which these documents were filed and how they were identified were inconsistent. Certain project officers indicated that they were unclear of how much documentation should be put in the files since all of the documents were kept electronically as well. Others indicated that they were not aware of the existence of file checklist forms. In addition, we noted that not all risk management checklist forms were completed.

Recommendations
  1. The risk management checklist form should be consolidated with the document checklist form and renamed appropriately, perhaps Project Management Checklist.

  2. Project officers should be informed of the existence and continued use of an appropriate checklist form.

  3. Project officers should be given guidance on what is key documentation and how much to retain in files.

  4. Documents should be kept in order of the various stages of a project cycle (i.e. application, approval, contribution agreement, payment, monitoring and reporting). Using tabs to identify certain key documents will facilitate the use of files by the project officers as well as their colleagues.

Standard Operating Procedures

We reviewed the SOPs dated June 16, 2006 which provides information on GPSF, the START Secretariat and SAB and the relevant government policies and acts. In addition, the SOPs outlines general steps to perform during the project cycle along with the relevant templates and reference documents. Based on our review, we noted some deficiencies and areas for improvement.

We acknowledge that START recognizes the need to update their SOPs in order to ensure that more detailed procedures and background information are provided. Shortly before preparing this report, we were provided with a preliminary draft of an updated version of the SOPs. We understand that this version has yet to be reviewed by all relevant parties and certain sections remain incomplete. As a result, we are not in a position to comment on this preliminary version of the SOPs. A well developed and comprehensive SOPs will serve as a useful orientation manual for new employees as well as a good reference tool for more experienced employees.

Recommendations
  1. All of the above details shoold be outlined in the Standard Operating Procedures.

  2. It is recommended that the updated SOPs be separated into two manuals, one that serves as an information source for all staff which includes the mandates, policies, acts etc.; and the other that serves as an operational manual for project officers outlining the specific procedures to perform throughout the project cycle.

Recipient Audits

START, in conjunction with ZIV, has developed a risk assessment process for recipient audits, which includes a determination of the following:

  • Recipients to be audited;
  • Scope, frequency and schedule of audits; and
  • Appropriate follow–up action of audit findings.

As required by the Risk–Based Audit Framework (RBAF), GPSF recipients are to be audited on an annual basis. At the time of writing this report, seven of the seventeen planned recipient audits for the fiscal year 2007–2008 have been completed. The remaining ten are in the process of being finalized. Based on the seven audits, audit adjustments in the amount of $77K were made representing 8.5% of $910K, the total value of the agreements.

Based on our GPSF recipient audits conducted to date, the following observations with regards to program management were made:

  1. Based on the dollar value of the audit adjustments that arose, it appeared that project officers did not review final financial reports with the care and depth required.
  2. Recipients' interpretations of various clauses of the contribution agreements lead to misunderstandings between themselves and the project officers.
  3. Instances were noted where a formal amendment should have been in place instead of an informal understanding between project officers and recipients relating to changes in dates, the nature of expenses or the purpose of expenses.
  4. There were conflicting start dates of the projects in the contribution agreements and the amendments, if any.
  5. Instances were noted where recipients never received a copy of the signed contribution agreement.
Recommendations
  1. In the short term, ZIV should conduct more initial visits to recipient organizations in order to communicate DFAIT's financial reporting requirements and to assess recipients' financial capacity.

  2. There should be a line by line alignment between the budget attached to the contribution agreement and the final financial report in order to facilitate review and assess compliance to the basis of payments.

Risk Management

Integrated risk management contributes to better program management and delivery and better value for money. It helps management make more informed decisions in managing the environmental, strategic, operational, political and financial risks that are under their control and should assist them better to respond to those risks that are beyond their control. In this context, the GPSF by the very nature of its programming and geographical areas in which it operates has significant risk factors that must be carefully identified and managed at both the program and specific intervention levels.

In March 2007, an IFM Risk Profile and Strategy Report was prepared for the Branch by Public Works and Government Services Canada (PWGSC). The report identified the major risks that need to be managed in IFM including the GPSF. We were unable to find any formal evidence that the report has been approved as IFM policy or that the actions outlined in the report are being implemented.

Risk management at the GPSF Program level is informal. We found no evidence of a formal review of the risks and mitigation strategies presented in the approved RBAF, which were initially identified some eighteen months ago. To be an effective tool in the management and control of the program, the identified risks and the associated mitigation strategies must be formally reviewed and updated on a regular basis (at least annually). As well, there is no bureau level risk registry which can be monitored on a regular basis.

At the project level we found that efforts are made to identify risks and mitigation strategies during the project development stage and that these are reviewed by the PDM committee. However, we feel that the risk assessment process at the project level is not thorough enough and that the risk statements are too general in nature to be an effective management tool. We found little evidence of monitoring and follow–up of the identified risks through the life cycle of the project. There is confusion between what constitutes risk management and what constitutes good management practices.

Recommendations
  1. IFM senior management should formally consider the Risk Profile and Strategy Report prepared by PWGSC and formally issue the current or a revised version of the report as Branch policy.

  2. START should immediately undertake a formal review to update the GPSF Program level risk and mitigation strategies identified in the RBAF. Subsequently there should be, as a minimum, an annual review and update.

  3. START should take steps to strengthen the project level risk management processes. This should include developing comprehensive policies and guidelines for staff based on TB policies and best practices. Training of staff in risk management practices should be considered a high priority.

Information Management

There is no Corporate Integrated Project and Financial management System in DFAIT for the management of grant and contribution programs. In an attempt to address the absence of a Corporate System START has developed a stand alone MS Access database. At the time of the audit, the system was still a work–in–progress: data entry is incomplete, the quality of the data is inconsistent and there is limited reporting capacity.

There is considerable duplication of effort. Three sets of books are being maintained which need to be continuously reconciled with the official Departmental system:

  1. Access data base
  2. Finance Officers' spread sheets
  3. Divisional spread sheets

IXS is currently participating with SXD to identify a solution to support DFAIT's grant and contribution programs. In an email from the CIO to the ADM, IFM, SXD are forecasting the following next steps:

  1. For completion by end of February:
    • preliminary analysis of AAFC/Grantium solution
    • decision whether to proceed with (a)Grantium hosted by AAFC, (b) purchase of Grantium, (c)other solution.
  2. For completion by end of financial year:
    • draft MOU or procurement agreement ready for signature
    • detailed multi–phase implementation plan
    • all IT issues identified and resolution planned
    • first program ready to pilot (actual pilot to take place in new fiscal year).

SXD remains committed to supporting IFM in meeting this timetable towards an effective solution.

This is a very positive development.

With regard to document management:

  1. the project files are reasonably well maintained, there is a central control on the files and the SOPs contain guidance on maintaining the files. The actual organization of the files should be more systematic;
  2. there is a central and secure file cabinet for the storage of some main documents such as MCs and TB submissions; and
  3. there is no subject matter filing system, SXKI has recently developed a Records Management System Framework for IRD which has not yet been implemented.
Recommendations
  1. It is critical that a Corporate Integrated Project and Financial Management System for the management of grant and contribution programs be implemented as soon as possible:
    1. IXS should closely monitor the progress of SXD in achieving the schedule they have outlined. Any significant deviations should be reported to the ADM;
    2. IXS and SXD should review the schedule with a view to accelerating the schedule; and
    3. as a stakeholder in the system START should also monitor progress and provide appropriate support as required.
  2. START should take immediate steps to implement the formal document management system developed by SXKI.

Communications

During the conduct of the audit both management and staff indicated that there is a need to improve internal communications so that there is a better flow of information through and across the organization.

To date, there has been little in the way of outreach communications. We understand there are a couple of publications that will be issued in the very near future.

Recommendations
  1. START management should undertake a review of both the formal and informal communications networks in the Secretariat with a view to determining what action(s) should be taken to improve internal communications.

  2. Consideration should be given to developing and delivering outreach communications targeted to specific groups as a means of building support for the Program.

Objective 2:

To provide assurance that START had complied with the terms and conditions for the GPSF.

ItemsTerms and conditions for a class of contributions for sub–programs supported by GPS FundMet/Not Met
1.0******
2.0DFAIT seeks to establish GPSF in order to carry out a list of specific objectives.Met
3.0The targeted beneficiaries of GPSF's sub–programs are specified.Met
4.0Projects funded under GPSF will be planned and managed to achieve a list of specific results (short–term, intermediate, long–term and ultimate results).Short term results met, working on achieving longer term results
5.0The outlined objectives of the three sub–programs should be met.Met
6.0The terms and conditions shall apply and payments shall be made between April1, 2006 and March31, 2010.Met
7.0Eligible recipients of contributions are specified.Met
8.0Contributions made to certain identified group of recipients under sub–programs financed by the proceeds of GPSF shall be exempt from the application of certain clauses of the TB Transfer Payment Policy.Met
9.0All projects delivering Assistance will become operational through written legal relationships referred to as Implementing Arrangements (MOU, MOA, contracts, contribution agreements/arrangements)Met
10.0DFAIT will provide financial or 'in–kind' contributions to eligible recipients to achieve the GPSF objectives. Selection of the appropriate delivery mechanism for GPSF projects will be determined based on a thorough analysis of listed factors.Met
11.0To ensure transparency and value for money, DFAIT shall select suppliers in an open and justifiable manner.Met
12.0Reporting requirements will follow the monitoring and reporting requirements identified in the integrated RMAF/RBAF.Met
13.0DFAIT will ensure that each Implementing Arrangement identifies the type and nature of eligible costs.Met
14.0DFAIT will take into account the total amount of Assistance that a recipient might receive from all other sources.Met
15.0The aggregate value of Assistance to a single recipient in the form of contributions shall not be more than $50M per eligible recipient, per year, including the value of any amounts under a supply agreement for the provision of an in–kind contribution.Met
16.0******
17.0Under GPS funded sub–programs, the levels of project approval and delegated authority for the use of proceeds of the GPSF are as listed.Met
18.0DFAIT shall make payments under Implementing Arrangements based on the cash flow requirements of the Government of Canada and the recipient, achievement of objectives, in accordance with the TB Transfer Payment Policy, and consistent with the exemptions to this policy approved by TB.Met
19.0Contributions from the GPSF will not be considered repayable.Met
20.0Any unexpended balances and the amount of any disallowed expenses will be recoverable by the Crown.Met
21.0In accordance with the integrated RMAF/RBAF for the GPSF, projects funded by the GPSF will be subject to an evaluation plan, internal and recipient auditing and reporting requirements.Met
22.0Where DFAIT requires services, goods and or equipment from entities, in order to assist in the performance of functions....such services...are considered as 'procurement contracts' and are subject and shall comply to, trade and competitive contracting, legal and policy requirements.Beyond scope of audit
23.0

Other terms and conditions

  1. Official Languages Act
  2. Additional costs
  3. Intellectual property
  4. Provisions for cancellation or reduction of funding
  5. Due diligence
  6. Reprofiling of funds
(a) (b) (c) –beyond scope of audit
(d) (e) (f) – met

We conclude that START has generally complied with the terms and conditions for the GPSF.

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3.0 Conclusion

Overall, we conclude that GPSF has an appropriate management control framework in place given that it is in its second year of operations. In addition, we found that START has generally complied with the terms and conditions for the GPSF. However, we point out that implementation of the recommendations made in this report will help to strengthen its management control framework.

Appendix A – Criteria

Governance

The role that the SAB has played should satisfy the governance requirements described in the RBAF.

The partners/donors should clearly demonstrate that they understand the role of DFAIT and its responsibilities to the Canadian Public.

Management Structure

IRD staff should clearly understand their roles, responsibilities, authorities and what they are accountable for.

IRD's organization structure should promote the efficient and effective delivery of projects.

Organization charts should exist for each division in IRD and be kept up–to–date.

IRD should have appropriate project management back–up capacity and associated capabilities.

Documentation relevant to IRD should be filed and centrally located to facilitate access to all staff.

Human Resource Management

There should be a Human Resource succession plan, by individual, which includes scenarios indicating possible staff departures and the timing of such departures and actions that could be taken to replace them.

The staff should accomplish the tasks called for in the Standard Operating Procedures (SOPs) when working reasonable hours.

The functional areas should clearly demonstrate, through the services they provide that they possess an understanding and knowledge of project management.

The functional areas should understand the high risk environment in which IRD operates.

The functional areas should provide effective advice and services to IRD in a timely manner.

IRD should have a clear understanding of what services are available and the roles of the functional areas.

Planning and Budgeting

Documentation should demonstrate that a multi–year (3 year) strategic plan was developed and used as the basis for allocating human and financial resources.

Documentation should demonstrate that performance against the strategic plan is monitored and adjustments made as appropriate.

There should be documentary evidence of a business (work) plan that clearly articulates IRD's operational plans and priorities for the current year.

The staff should be familiar with the content of the plans including the priorities for the current year.

Documentation should exist that performance against the business and operational plan is regularly monitored and adjustments made as appropriate.

Project Management

Project documentation should demonstrate that the SOPs are being used.

The application of the SOPs to the current portfolio of projects should be effective, efficient and reasonable.

Evidentiary documentation should indicate that both sound financial and project management practices were/are being followed.

The staff should have the competencies required to work within a project management environment.

The projects should be on track to achieve their stated objectives (time, cost & scope).

The grant/contribution agreement/contract should be complete and consistent with Department guidelines.

Terms and conditions of the contribution agreement should be met.

A filing system should be in place to track proposals and projects.

Risk Management

There should be evidentiary documentation that the risk and mitigation strategies in the RMAF and RBAF have been reviewed and updated on a regular basis (i.e. every six months).

Documentation should demonstrate that the commitments specified in the RMAF and RBAF's have been reviewed and updated as appropriate and differences reconciled.

The management of information should be such that the retrieval of key information can be achieved effectively and efficiently.

Financial Administration Practices

IRD Finance should oversee the financial management of GPSF in accordance with DFAIT and Government of Canada financial practices and policies.

Documentation should exist to support an advance payment as well as other payments made with respect to contribution agreements.

Proper authorization such as S34 and S33 of the Financial Administration Act should be obtained prior to making contribution payments.

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Appendix B – Summary of Recommendations and Management Responses

ItemsRecommendationsIn Agreement or NotManagement ResponseResponsibility CentreTime–frame
14.1 Governance/ Management Structure
***
In AgreementThe START Advisory Board – a crucial component of the GPSF governance structure – required strengthening in terms of membership and mandate to more effectively fulfill its function. DFAIT is working with OGDs to address these areas. This included a meeting of the Advisory Board in November 2007 where the mandate was discussed and a clear work plan established. The strategic approach will be further strengthened in another meeting of the Advisory Board, in March 2008, where they acknowledged the need to review and revise their mandate to take into account changes such as new responsibilities and consideration of the involvement of other Government of Canada stakeholders, including the geographic task forces.

The Board shared its Terms of Reference with the ADM Committee for their review and endorsement. It was determined that the membership of the Board will be expanded to include the Director General for International Affairs at PSEPC – in order to ensure that all sectors of PSEPC invested in fragile states are represented (specifically to include corrections).
Assistant Deputy Minister, International Security Branch (IFM)To be completed in the second quarter of fiscal year 2008–2009
24.1 Governance/ Management Structure
The overall governance/committee structure at the Deputy Minister and Assistant Deputy Minister level should be reviewed to ensure appropriate representation at this level by the OGDs.
In AgreementThe current membership of both the Deputy Minister and Assistant Deputy Minister committees consists of representatives from CIDA and DFAIT.  When the START governance structure was established in November 2006, the issue that both DFAIT and CIDA had significant programming and operations in fragile states was of central concern. In order to avoid duplication and ensure coherence it was agreed that the DMs of DFAIT and CIDA would meet twice a year to agree on joint recommendations to Ministers and to reflect Ministerial direction to their respective staffs.

ADMs of CIDA and DFAIT met in the first quarter of Fiscal Year 2008/2009 to consider. There was a discussion on how best to include OGDs at the ADM level. The interim decision of the ADM committee was to invite OGD counterparts on a case–by–case basis. This recommendation will also go forward to the DM Committee at their next meeting, expected in June.

Based on the experience of the past year and a greater appreciation that OGDs, including DND and PSEPC, are also heavily invested in fragile state work, there is a discussion underway to include OGDs in the ADM Committee.

The START Advisory Board will put forth recommendations for membership of the committee structures.
Assistant Deputy Minister, International Security Branch (IFM)To be completed in the first quarter of fiscal year 2008–2009.
34.1 Governance/ Management Structure
Action should be taken to clarify and document the roles, responsibilities and accountabilities of the Afghan and Sudan task forces, the Haiti Steering Committee and the START Secretariat as it relates to these countries.
In AgreementDFAIT will review strategic and planning tools to determine how best to ensure that GPSF activities fit within overall country strategies.

START will be undertaking a study of the various management models that DFAIT employees use to address fragile state environments including the Afghanistan Task Force; Sudan Task Force and Haiti Steering Committee.  The purpose of the study is to determine the advantages and disadvantages to each model in order to more appropriately respond when a new crisis emerges. It is anticipated that through this process agreements setting out accountabilities and roles and responsibilities will be defined and documented.  

In September 2006, IRC/FSDN/KHRTM produced a document clarifying mandates and outlining specific roles and responsibilities for an integrated departmental response to conflict prevention and peace building needs in Sudan.

With regard to our relationship with the Afghanistan Task Force, START is guided by the Afghanistan Concept Paper.

There have been working–level exchanges on roles and responsibilities between START and the geographics which will be formalized in TORs (ex. Haiti Steering Committee).
Assistant Deputy Minister, International Security Branch (IFM)To be completed in the second quarter of fiscal year 2008–2009.
44.1 Governance/ Management Structure
A review should be undertaken of the current organization structure and management responsibilities associated with the three sub–programs to ensure that roles, responsibilities and accountabilities can be clearly attributed and articulated. In this process consideration should be given to managing and reporting at the Program level rather than at the sub–program level.
In AgreementIn the course of better defining the policy contribution of START and conducting a detailed analysis of the project planning cycle, the current structure of START has been reviewed.

IRD has proposed renewal of the current organizational structure vis–à–vis the needs and management requirements for programming for each of the distinct types of programming [immediate crisis response; short and medium–term support for post–crisis stabilization, reconstruction and peace–building; responsive vs. directive programming; and organizational and institutional capacity building]. Areas of priority will include the nature and distribution of human resources and programming modalities. An initial proposal centered on distinct policy and programming divisions working in tandem has been approved by IFM, and is currently being fleshed out for implementation. A work plan will be created and can be put into action now that longer term authorities have been granted.
Assistant Deputy Minister, International Security Branch (IFM)To be completed in the second quarter of fiscal year 2008–2009.
54.1 Governance/ Management Structure
There is a time sensitive need for the Bureau to focus on a number of items requiring functional expertise, therefore it is recommended that the group responsible for functional activities in the Bureau not have any programming responsibilities so that it can devote full time to ensuring that the functional requirements of the Bureau are met.
In AgreementIRD ensures policy coherence and provides program oversight to ensure compliance with GOC regulations. The unit is also responsible for developing program tools and ensuring compliance with these tools. It does not currently have any programming responsibilities.

IRD will take this recommendation under consideration during the organizational structure and management responsibilities review described in Point 4.
Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the second quarter of fiscal year 2008–2009.
64.1 Governance/ Management Structure
The role of the Bureau level Management Committee should be strengthened so that it plays a central role in advising the Director General on substantive management issues facing the Bureau. A set of TORs for the committee should be developed. Consideration should also be given to sharing meeting notes with all staff in the Bureau.
In AgreementSTART agrees that a set of TORs for the Bureau level Management Committee be developed. Meeting minutes will also be drafted and key follow–up and action items will be shared with staff in the Bureau.

START has instituted bilateral meetings with its Directors to improve the efficiencies of Management Committees.
Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the second quarter of fiscal year 2008–2009.
74.1 Governance/ Management Structure
The roles and responsibilities of the PPC and PDM committees should be reviewed to ensure that they are operating as effectively and efficiently as possible and that they are operating within a minimum time frame.
Under ConsiderationIRD is in the process of reviewing the role of the PPC with its members; however, the emphasis will remain on ensuring appropriate due diligence and value–for–money of public funds.

It is the opinion of IRD that the PPC ensures complementarities between GPSF programming and GOC policy priorities. It is also of the opinion that the PDM is a highly effective committee that ensures due diligence of all GPSF projects, including the sharing of best practices and lessons learned.
Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the first quarter of fiscal year 2008–2009.
84.2 Human Resource Management
With a view to ensuring efficient and effective program/project delivery and enhancing its capacity to staff both the policy and project management functions with appropriate skill sets, START should review its current structure where both the policy and delivery functions are vested in one individual. In this context, START should also consider establishing a unit dedicated to program/project delivery. The establishment of such a unit would also provide a logical home for any additional functional resources that are required.
Under ConsiderationIRD is reviewing the impact of the single officer model on policy and programming.

DFAIT has received international recognition for close alignment of policy and programming. The new model of tandem programming and policy divisions currently being developed will address the need for accommodating additional functional resources.
Assistant Deputy Minister, International Security Branch (IFM)To be completed in the second quarter of fiscal year 2008–2009.
94.2 Human Resource Management
START should develop a comprehensive Human Resource plan which should include a review of the number and type of human resources it will require to deliver the planned program. It should also include a comprehensive training and development plan. The plan should be action oriented, include target dates and provide for appropriate monitoring and follow–up.
In AgreementIRD has been proactive in identifying and establishing a set of mandatory training courses (environmental assessment training, gender training, anti–terrorism clause training, and performance management training). The mandatory training courses have been operationalized in divisional and individual learning plans.

A START Human Resource Plan was formulated for FY 06–07. The Plan will be reviewed post restructuring.
Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the last quarter of fiscal year 2008–2009.
104.2 Human Resource Management
To ensure all staff receives formal feedback on their performance, START management should fully implement the DFAIT PMP.
In AgreementThis is being undertaken in line with departmental requirements.Director General, Stabilization and Reconstruction Task Force (IRD)PMP input exercise completed by the end of fiscal year 2007–2008.
114.2 Human Resource Management
Formal training plans should be developed for all staff.
In AgreementThis is being undertaken in line with departmental requirement to have 94% of staff with learning plans.Director General, Stabilization and Reconstruction Task Force (IRD)Learning plans completed by the end of fiscal year 2007–2008.
124.2 Human Resource Management
The role of the Branch level HR Committee should be expanded to include other major HR areas such as planning and training.
In AgreementThe IFM Branch HR committee was established in September 2006 with a mandate to: Review and identify strategies to adopt, steps to take and follow–up required for current and future HR processes; Raise issues facing the IFM Branch and thus identify timely common strategies and solutions; Liaise with HCM's HR services; and,Establish staffing and classification priorities. During the last 16 months, the mandate of the HR committee has evolved to include Branch HR planning with the development of the IFM HR Strategic Plan 2007–2010.

The IFM HR committee will undertake a review of the role of the Committee and its membership to explore what other major HR areas such as planning and training should be included.
Assistant Deputy Minister, International Security Branch (IFM)
And
Director, Program Services (IXS)
To be completed in the first quarter of fiscal year 2008–2009.
134.2 Human Resource Management
Prior to any further staffing of Financial Officers taking place, the role of these officers in the Branch should be reviewed to ensure that the roles and responsibilities of the officers both at the Branch and Bureau levels are clear.
Under ConsiderationIRD and IXS continue to work in conjunction with SMD to ensure that the strengthening of the financial management resources for GPSF is in line with the consolidation of FIs under the new SFO model.Director General, Stabilization and Reconstruction Task Force (IRD)On–going
144.2 Human Resource Management
At the divisional level, regular formal staff meetings should be held. Minutes of meetings should be kept and made available, as appropriate, to all staff levels.
In AgreementRegular formal staff meetings will be held at the divisional level.Director General, Stabilization and Reconstruction Task Force (IRD)On–going.
154.2 Human Resource Management
The requirement for an expert placement unit should be reviewed.
In AgreementSeveral options have been identified and are under consideration. This issue has implications for the Department as well as OGDs.

In the course of better defining the policy and programming contribution of START, the current structure of START will be reviewed.
Director General, Stabilization and Reconstruction Task Force (IRD)On–going
164.3 Planning and Budget Management
START should adopt a results based management approach by putting into practice its RMAF and RBAF. This would include a comprehensive schedule of planning, programming, monitoring and reporting for all its activities. Responsibility for delivering each component of the schedule should be stated and all staff informed.
In AgreementIRD is implementing a process whereby the budgeting and reporting process is formally documented with responsibilities/calendar of events appropriately articulated and communicated to relevant officers and managers.

IFM/SXEM will undertake a program process review and recommendations study. The review and study investigated current program business processes, analyzed with respect to commonalities across programs and audit/evaluation recommendations and proposed a High Level Common Business Process Framework for IFM programs and a Detailed Process map for the GPSF.
Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the first quarter of fiscal year 2008–2009.
174.3 Planning and Budget Management
When funding for the program is normalized and when preparing the Corporate Business Plan. START should conduct an annual in–depth analysis of the results it intends to achieve and the resources it will require to achieve these results over the ensuing three years. This analysis should include:

A review of the longer term (3 year) priorities, objectives and desired results for the program;

A review, based on the foregoing, of the longer term operating budget requirements (financial and human) of START;

A review of the progress and results being achieved of all operational projects;

A review of the continued relevance and status of any new programs or projects being considered; and

A review of the cash flow requirements for the Program.

The results of this review should be formally documented and shared with DFAIT senior management. It should also serve as the basis to measure START's performance against planned results.
In Agreement***

In setting annual strategic policy priorities for GPSF programming, START will collaborate with experts from partner departments and agencies, missions, and international partners to assess needs, review and prioritize the identified projects, and proceed with high priority projects, each fiscal year.

In addition, as part of the annual fragile states prioritization exercise, options for engagement will be developed by an interdepartmental working group, led by START. Initiatives within these fragile environments are identified for whole–of–government response where Canadian involvement can be catalytic and effective in support of stabilization, conflict prevention and peace building. These options will be presented to, and approved by, the START Advisory Board (AB).

Strategic policy priorities for GPSF programming in the selected fragile states will be developed by START and include comprehensive consultation with all relevant DFAIT divisions, including missions, and other government departments thereby ensuring the strategies are in line with country strategies for these fragile states and GOC priorities.
Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the second quarter of fiscal year 2008–2009.
184.3 Planning and Budget Management
A detailed budget and work plan should be prepared prior to the commencement of each fiscal year. This plan should be monitored on a quarterly basis and the appropriate adjustments made. The plan and review should be results based.
In Agreement***

By way of preparation, IRD has prepared indicative budget planning documents for 2008–2009.
Director General, Stabilization and Reconstruction Task Force (IRD)*** this will be implemented for Fiscal Year 2008–2009.
194.4 Project Management
All proposals should be received through a central portal and then recorded in the IRD central database. The Secretariat can then allocate the proposals to the appropriate divisions depending on the proposals' relevance to the sub–programs and thematic envelopes.
Under ConsiderationIn the course of better defining the policy contribution of START and conducting a detailed analysis of the project planning cycle, the current structure of START will be reviewed.

IFM/SXEM has undertaken a program process review and recommendations study. The review and study investigated current program business processes, analyzed with respect to commonalities across programs and audit/evaluation recommendations and proposed a High Level Common Business Process Framework for IFM programs and a Detailed Process map for the GPSF.
Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the first quarter of fiscal year 2008–2009.
204.4 Project Management
The critical step of assessing proposals against program criteria and mandates should be included in the risk management checklist to demonstrate that it is done.
In AgreementPrior to the release of the audit findings, IRD included the identified critical step of assessing proposals against program criteria and mandates directly into the proposal template. IRD believes that the step is more appropriately incorporated into the proposal template as opposed to within the risk management checklist, as was recommended by ZIV.Director General, Stabilization and Reconstruction Task Force (IRD)Completed
214.4 Project Management
A dedicated resource should be available to perform the financial analysis that is necessary throughout the various stages of a project from initial proposal to completion.
In AgreementEven with limited financial personnel, more analysis is being undertaken. IRD is currently in discussion with SMD to identify and hire necessary resources to strengthen the financial management team of START.

The capacity and skill sets required to review financial project reports need to be strengthened. START is addressing this gap by providing regular mandatory training to all project officers and managers. The ability to provide regular training will be contingent on having enough FI resources in the Bureau.
Director General, Stabilization and Reconstruction Task Force (IRD)On–going
224.4 Project Management
Detailed step–by–step procedures should be developed to guide project officers on how to have environment assessments done.
In AgreementIRD will update the required steps for the completion of environmental assessments in the new SOPs.

A revised Screening Form (EXT1721) has recently been developed by GDS and is now available on Forms Online. The form includes a detailed guide as well as a pre–screening form to determine whether an environmental assessment is required under the Act. IRD will approach GDS to discuss further training opportunities.
Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the second quarter of fiscal year 2008–2009.
234.4 Project Management
Project officers should be reminded that environmental assessment forms should be signed and dated by them even if no assessments are required.
In AgreementSTART Management has implemented this recommendation. The requirement for signature and date are detailed in the SOPs. The approval package for a project is not approved without IRD first receiving a signed and dated environmental assessment form. Additionally, files cannot be closed without the proper documentation, including the environmental assessment form.Director General, Stabilization and Reconstruction Task Force (IRD)Completed
244.4 Project Management
An instruction sheet should accompany the templates provided to recipients explaining the amount and depth of information required in each section.
In AgreementSTART Management has implemented this recommendation. Prior to the finalization of the program audit of the GPSF, IRD developed a new information package for applicants outlining step–by–step instructions. The package has also been updated to represent the most recent version of the program's proposal templates. IRD has also made the info package available on the START website.Director General, Stabilization and Reconstruction Task Force (IRD)Completed
254.4 Project Management
The procedure requesting comments on a no–objection basis through an e–mail sent to all relevant stakeholders after PDM approval should be eliminated.
Under ConsiderationIRD is of the opinion that the procedure is a necessary element of due–diligence. The PDM is not an approval body. Rather, it reviews the technical merits of all GPSF projects.

The procedure requesting comments on a no–objection basis after PDM review of technical merits is a necessary step in the project approval process. The procedure ensures formal consultation with all necessary desks, OGDs, and posts. It also provides an opportunity to ensure that all changes recommended at PDMs are completed before the project is forwarded for consideration/approval by the relevant authority. Experience has shown that many problems have been caught at this level.
Director General, Stabilization and Reconstruction Task Force (IRD)N/A
264.4 Project Management
Contributions of small dollar value should not have to go through all of the stringent processes as large dollar value contributions.
Under ConsiderationIn the course of better defining the policy contribution of START and conducting a detailed analysis of the project planning cycle, the current structure of START will be reviewed.Director General, Stabilization and Reconstruction Task Force (IRD)On–going
274.4 Project Management
When persons with Acting authority sign on behalf of the Senior Director, their names should be printed alongside their signatures in order to clearly identify themselves.
In AgreementSTART Management has implemented this recommendation.Director General, Stabilization and Reconstruction Task Force (IRD)Completed
284.4 Project Management
The START Secretariat should provide guidance to project officers on how to enforce the clause relating to interest earned on advances in contribution agreements.
In AgreementSTART Management has implemented this recommendation. Officers are reminded at PDMs to ensure that the clause on interest on advances is implemented appropriately.Director General, Stabilization and Reconstruction Task Force (IRD)Completed
294.4 Project Management
In order to encourage consistent monitoring practices, project officers should be given guidance as to the various methods of monitoring, the types of projects that warrant various types of monitoring and the method in which the monitoring activities should be documented. The SOPs would be the best forum to outline these details. In addition, all monitoring activities should be formally documented.
In AgreementSTART Management agrees with this recommendation. IRD agrees that there is a need to improve monitoring practices. IRD has been proactive on this issue, and in coordination with IXS, has developed new reporting templates. The new templates have monitoring mandatory and simplified the process to track results.

Additional guidance will be provided in the updated SOPs.
Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the second quarter of fiscal year 2008–2009.
304.4 Project Management
To perform adequate analysis of financial documents provided by recipients, project officers should be given the appropriate training to be able to perform a basic level of financial analysis.
In AgreementSTART Management has implemented this recommendation. IRD has addressed the need to provide appropriate training for project officers. An IRD finance officer has provided group training on this subject and further guidance has been provided through mentoring with individual officers. Officers are also formally requested to consult with IRD finance officers on all proposal budgets.

The process has been articulated in the SOPs and will be re–stated in the updated version of the document.
Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the second quarter of fiscal year 2008–2009.
314.4 Project Management
The risk management checklist form should be consolidated with the document checklist form and renamed appropriately, perhaps Project Management Checklist.
In AgreementThe checklist will be one of the elements to be reviewed as START conducts an analysis of the project planning review and approval cycle.Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the second quarter of fiscal year 2008–2009.
324.4 Project Management
Project officers should be informed of the existence and continued use of an appropriate checklist form.
In AgreementSTART Management has implemented this recommendation. The Risk Management checklist is a mandatory component of the approval process, the payment process, and the implementing arrangement process.

IRD ensures that the checklist is included and completed before approving project proposals, implementing arrangements, and payment requests.

The process has been articulated in the SOPs and will be re–stated in the updated version of the document.
Director General, Stabilization and Reconstruction Task Force (IRD)Completed
334.4 Project Management
Project officers should be given guidance on what is key documentation and how much to retain in files.
In AgreementAlthough a list of required documents is in the SOPs, further guidance on other useful documentation for the files will be included in the updated SOPs.Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the second quarter of fiscal year 2008–2009.
344.4 Project Management
Documents should be kept in order of the various stages of a project cycle (i.e. application, approval, contribution agreement, payment, monitoring and reporting). Using tabs to identify certain key documents will facilitate the use of files by the project officers as well as their colleagues.
In AgreementIRD will clarify the order of documents in the updated SOPs.Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the second quarter of fiscal year 2008–2009.
354.4 Project Management
All of the above details should be outlined in the Standard Operating Procedures.
In AgreementSTART Management agrees with the recommendation.Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the second quarter of fiscal year 2008–2009.
364.4 Project Management
It is recommended that the updated SOPs be separated into two manuals, one that serves as an information source for all staff which includes the mandates, policies, acts etc.; and the other that serves as an operational manual for project officers outlining the specific procedures to perform throughout the project cycle.
Under ConsiderationIRD will take the recommendation into consideration once the draft of the updated SOPs is complete.Director General, Stabilization and Reconstruction Task Force (IRD)To be completed in the second quarter of fiscal year 2008–2009.
374.5 Recipient Audits
In the short term, ZIV should conduct more initial visits to recipient organizations in order to communicate DFAIT's financial reporting requirements and to assess recipients' financial capacity.
In AgreementIRD has acted proactively to meet the identified gap in initial visits.

*** Moreover, SMFH will also work with IRD and ZIV to identify recipients to be considered for initial visits and audits.
Director General, Stabilization and Reconstruction Task Force (IRD)A completion date will be determined in coordination with ZIV.
384.5 Recipient Audits
There should be a line by line alignment between the budget attached to the contribution agreement and the final financial report in order to facilitate review and assess compliance to the basis of payments.
In AgreementSTART Management implemented this recommendation in the 3rd quarter of fiscal year 2007–2008.Director General, Stabilization and Reconstruction Task Force (IRD)Completed
394.6 Risk Management
IFM senior management should formally consider the Risk Profile and Strategy Report prepared by PWGSC and formally issue the current or a revised version of the report as Branch policy.
In AgreementThe Branch Risk Profile will be updated after the DFAIT Risk Profile is finalized and approved. An implementation approach will be developed and communicated across the IFM branch.Assistant Deputy Minister, International Security Branch (IFM)To be completed in the first quarter of fiscal year 2008–2009.
404.6 Risk Management
START should immediately undertake a formal review to update the GPSF Program level risk and mitigation strategies identified in the RBAF. Subsequently there should be, as a minimum, an annual review and update.
In AgreementIRD and IXS are in the process of reviewing the approved RMAF/RBAF for GPSF. These documents are evergreen and are being revised in view of lessons learned and will be shared with TBS upon completion.Director General, Stabilization and Reconstruction Task Force (IRD) and Director, Program Services (IXS)To be completed in the third quarter of fiscal year 2008–2009.
414.6 Risk Management
START should take steps to strengthen the project level risk management processes. This should include developing comprehensive policies and guidelines for staff based on TB policies and best practices. Training of staff in risk management practices should be considered a high priority.
In AgreementIRD and IXS will review. IRD, with support from IXS, will be developing a set of guidance documents and policies to clarify the SOPs on a number of issues – including risk management in line with best practices.Director General, Stabilization and Reconstruction Task Force (IRD) and Director, Program Services (IXS)To be completed in the second quarter of the fiscal year 2008–2009
424.7 Information Management
It is critical that a Corporate Integrated Project and Financial Management System for the management of grant and contribution programs be implemented as soon as possible: IXS should closely monitor the progress of SXD in achieving the schedule they have outlined. Any significant deviations should be reported to the ADM; IXS and SXD should review the schedule with a view to accelerating the schedule; andas a stakeholder in the system START should also monitor progress and provide appropriate support as required.
In AgreementDFAIT is in the process of developing a Corporate Integrated Project and Financial Management System.

START recognizes that the GPSF information management system should be reconciled with departmental systems. As the development of a department–wide information management tracking system is currently on–going, START has developed, as an interim measure, a project tracking system and is collaborating with corporate partners in the development of a departmental information management system.

IFM/SXEM has undertaken a program process review and recommendations study. The review and study investigated current program business processes, analyzed with respect to commonalities across programs and audit/evaluation recommendations and proposed a High Level Common Business Process Framework for IFM programs and a Detailed Process map for the GPSF.
Assistant Deputy Minister, International Security Branch (IFM) and Assistant Deputy Minister, Corporate Services (SCM)To be completed in the second quarter of fiscal year 2008–2009.
434.7 Information Management
START should take immediate steps to implement the formal document management system developed by SXKI.
In AgreementSTART Management has implemented this recommendation. START's formal document management system for project files was agreed to by SXKI and IXS and is managed internally within IRD.

For corporate documents IRD follows Infobank procedures for electronic documents, and paper files for the bureau are secured within IRD. The electronic filing system for documents on the branch drive will be revisited to identify efficiencies, and changes will be formalized and communicated to all START officers.
Director General, Stabilization and Reconstruction Task Force (IRD)Full implementation to be completed in the first quarter of fiscal year 2008–2009.
444.8 Communications
START management should undertake a review of both the formal and informal communications networks in the Secretariat with a view to determining what action(s) should be taken to improve internal communications.
In AgreementManagement has conducted several town hall meetings to inform START staff of significant business developments. Employees also attend informal events to celebrate milestones and significant achievements to promote teambuilding.

In December 2007, START launched its web presence on the DFAIT website at http://www.international.gc.ca/fac/start-gtsr/index.aspx. The website includes both feature articles and core information about the GPSF and sub–programs, including its structure and programming administration.

In 2008/2009, the Communications team will also undertake the creation of an intranet site, so that all DFAIT staff will be aware of START/GPSF. The intranet is also intended to drive traffic to the START internet site.

START is also considering the development of an online Community of Practice, intended to be a one–stop source for programming procedures/administration, and information about employee skills and talents.
Director General, Stabilization and Reconstruction Task Force (IRD)On–going
454.8 Communications
Consideration should be given to developing and delivering outreach communications targeted to specific groups as a means of building support for the Program.
In AgreementThe following communications outreach/marketing activities have been implemented: targeted distribution list of public and private partners and stakeholders; major presentations, including two outreach visits with South American journalists, briefing to the Canadian Peace building Coordinating Committee, and a presentation to the OECD–DAC; and several publications and marketing materials, including START Year in Review 2005–2006, START in Haiti brochure, START in–a–box Presentation, and the START Corporate Brochure.

In December 2007, START launched its web presence on the DFAIT website. The website includes both feature articles and core information about the GPSF and sub–programs including its structure, and programming administration.

The START Communications team has an e–mail account for public inquiries, which is promoted in all marketing materials. This e–mail account is monitored by Communications staff and incoming inquiries are directed to appropriate staff for response.
Director General, Stabilization and Reconstruction Task Force (IRD)On–going

Appendix C

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Office of the Chief Audit Executive


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Date Modified:
2012-02-10