Annex – Assessment of Internal Control over Financial Reporting for the fiscal year ended March 31, 2015

1. Introduction

In support of an effective system of internal control, the Canadian Human Rights Commission (the Commission) annually assesses the performance of its financial controls to ensure that:


  • Financial arrangements or contracts are entered into only when sufficient funding is available;
  • Payments for goods and services are made only when the goods or services are received or the conditions of contracts or other arrangements have been satisfied; and 
  • Payments have been properly authorized.


The Commission leverages the results of the periodic core control audits performed by the Office of the Comptroller General. The Audit Report for the Core Control Audit conducted during fiscal year 2011-12 and the related Management Action Plan are posted on the Commission's web site. During fiscal year 2014-15, the Commission engaged a contractor to perform the assessment in accordance with the ongoing monitoring plan. Below is a summary of the results of the Commission’s independent assessment conducted during fiscal year 2014-15.

1.1 Service arrangements relevant to financial statements

The Commission relies on other organizations for the processing of certain transactions that are recorded in its financial statements as follows. Some other government departments and agencies rely on the Commission for the processing of certain transactions as per the interdepartmental arrangements.

Common Arrangements


  • Public Works and Government Services Canada centrally administers all payments including salaries, and the procurement of goods and services in accordance with applicable acts, regulations, and policies, and provides accommodation services to the Commission;
  • The Treasury Board of Canada Secretariat provides the Commission with information used to calculate various expenses, accruals and allowances, such as the accrued severance liability and the rate to be used for government payments to employee insurance plans; and
  • The Employment and Social Development Canada provides work’s compensation coverage to the Commission.

Specific Arrangements

  • The Commission provides Internal Support Services to some other government departments related to the provision of Finance, Compensation, Human Resources, Procurement, Administration and Information Technology services through Memorandums of Understanding. The information acquired through the assessments is shared with the clients who use the Commission’s Internal Support Services.  

2. Assessment results during fiscal year 2014-15

The key findings and significant adjustments required from the current year’s assessment activities are summarized below.

New or significantly amended key controls: In the current year, there were no significant amended key controls in existing processes which required a reassessment. During fiscal year 2013-14, the Commission modified its account verification process and implemented the Account Verification Post-Payment Sampling Process whose design was confirmed to be appropriate and in compliance with Treasury Board Directive on Account Verification. No testing of operational effectiveness has been performed.

Ongoing monitoring program: As part of its rotational ongoing monitoring plan, the Commission completed its reassessment on the operating effectiveness of key controls for the following business processes: contracting; salaries; confirmation of delegated authority and specimen authentication; end of period accounting and financial reporting; and budgetary controls and cash flow management. Operating effectiveness assessment was also completed for information technology (IT) general controls in the areas of IT management and IT security.

For the most part, the key controls that were performed as intended, with observations as follows:

  • Some documentation was not complete for FAA Section 34 approval of salaries.
  • Opportunities for improvement were identified in order to enhance the policy instruments related to IT security.

Management actions plans were developed to address the issues noted.

3. Action plan

3.1 Progress during fiscal year 2014-15

The Commission continued to conduct its ongoing monitoring according to the previous fiscal year’s rotational plan as shown in the following table.

Progress During Fiscal Year 2014-15

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In 2014-15, the Commission conducted the following work in addition to the progress made in ongoing monitoring:

  • Review and update the documentation of significant business processes and controls to ensure their relevance.
  • Follow-up on observations identified in previous years.

3.2 Action plan for the next fiscal year and subsequent years

The Commission’s multi-year monitoring plan over the next three years, based on an annual validation of the high-risk processes and controls and related adjustments to the ongoing monitoring plan as required, is shown in the following table.

Rotational Ongoing Monitoring Plan

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