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ARCHIVED - Horizontal Internal Audit: Travel and Hospitality in Small Departments and Agencies


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Annexes

Annex 1:  Designated Small Departments and Agencies

  1. Assisted Human Reproduction Agency of Canada
  2. Canada Emission Reduction Incentives Agency
  3. Canada Industrial Relations Board
  4. Canadian Artists and Producers Professional Relations Tribunal
  5. Canadian Centre for Occupational Health and Safety
  6. Canadian Environmental Assessment Agency
  7. Canadian Forces Grievance Board
  8. Canadian Human Rights Commission
  9. Canadian Human Rights Tribunal
  10. Canadian Intergovernmental Conference Secretariat
  11. Canadian International Trade Tribunal
  12. Canadian Polar Commission
  13. Canadian Radio-television and Telecommunications Commission
  14. Canadian Transportation Agency
  15. Commission for Public Complaints Against the RCMP
  16. Copyright Board of Canada
  17. Financial Consumer Agency of Canada
  18. Financial Transactions and Reports Analysis Centre of Canada
  19. Hazardous Materials Information Review Commission
  20. Indian Residential Schools Resolution Canada
  21. Law Commission of Canada
  22. Military Police Complaints Commission
  23. NAFTA Secretariat - Canadian Section
  24. National Battlefields Commission
  25. National Energy Board
  26. National Farm Products Council
  27. National Parole Board
  28. National Round Table on the Environment and the Economy
  29. Northern Pipeline Agency Canada
  30. Office of the Communications Security Establishment Commissioner
  31. Office of the Correctional Investigator of Canada
  32. Office of the Secretary to the Governor General
  33. Office of the Superintendent of Financial Institutions
  34. Patented Medicine Prices Review Board
  35. Public Service Labour Relations Board
  36. Public Service Staffing Tribunal
  37. RCMP External Review Committee
  38. Registrar of the Supreme Court of Canada
  39. Registry of the Competition Tribunal
  40. Security Intelligence Review Committee
  41. Status of Women Canada
  42. Transportation Appeal Tribunal of Canada
  43. Transportation Safety Board of Canada

Annex 2: Detailed Examination List – 21 SDAs

  1. Canada Industrial Relations Board
  2. Canadian Environmental Assessment Agency
  3. Canadian Human Rights Commission
  4. Canadian Intergovernmental Conference Secretariat
  5. Canadian Polar Commission
  6. Canadian Radio-television and Telecommunications Commission
  7. Canadian Transportation Agency
  8. Commission for Public Complaints Against the RCMP
  9. Financial Transactions and Reports Analysis Centre of Canada
  10. Indian Residential Schools Resolution Canada
  11. National Energy Board
  12. National Farm Products Council
  13. National Parole Board
  14. National Round Table on the Environment and the Economy
  15. Office of the Correctional Investigator of Canada
  16. Office of the Secretary to the Governor General
  17. Office of the Superintendent of Financial Institutions
  18. Security Intelligence Review Committee
  19. Status of Women Canada
  20. Transportation Appeal Tribunal of Canada
  21. Transportation Safety Board of Canada

Annex 3: Summary Table of Test Results by Finding

Report Finding: Description Findings /
Claims Tested
Percentage of Findings Page Reference
Finding 2: Pre-Authorization for Travel 167/401 42% 12
Finding 3: DH Travel Pre-Authorization 43/69 62% 13
Finding 4: Supporting Documents for Travel Claims 57/401 14% 14
Finding 5: FAA s.34 for Travel Claims Incomplete 91/401 23% 15
Finding 5: FAA s.33 for Travel Claims not Dated 51/401 12% 15
Finding 6: FAA s.34 for Hospitality Claims Incomplete 36/115 31% 16
Finding 7: Circumstance of Hospitality Documented 12/115 10% 17
Finding 7: Hospitality Event Attendee Details 21/115 18% 17

Annex 4: Links to Applicable Policies, Directives, Guidance

Web Site References (links current as of 12 Aug 08)

Account Verification Policy
Financial Administration Act
Guidance: Proactive Disclosure of travel and hospitality expenses
Hospitality Policy
Payments and Settlements Requisitioning Regulations, 1997
Policies and Guidelines for Ministers' Offices
Policy on Active Monitoring
Policy on Commitment Control
Policy on Delegation of Authorities
Policy on Electronic Authorization and Authentication
Policy on Payment Requisitioning and Payment on Due Date
Policy on Using Traveller Cheques, Travel Cards and Travel Accounts
Special Travel Authorities
Terms and Conditions of Employment for Full Time Governor in Council Appointees
Travel Directive
Values and Ethics Code for the Public Service

Annex 5: Travel and Hospitality Audit Criteria

Objective: Governance

Objective: Risk Management

Objective: Internal Controls

Annex 5 - textual version

Annex 6:  Management action plan

The following table presents the list of recommendations as well as a description of the actions being taken to address them.

Recommendations Management Action
Governor in Council Appointees: Departments and agencies should ensure that the specific travel expense entitlements and supporting documentation applicable to GIC appointees within their respective organizations are clearly communicated to the appointees and explained to those responsible for the administration of travel expenses and claims. Such communication and explanation should include specific reconciliation to pertinent policy and regulations, including the identification of any provisions that are unique to the SDA.

Organizations have improved their travel and hospitality procedures with regards to GIC appointees. As an example, pre-authorizations and section 34 approvals are authorized by an independent senior official (such as the SFO). One organization has debriefed their GIC appointees on the preliminary findings of this audit and provided further explanation of travel and hospitality requirements. Another organization is planning to provide written guidance to all future GIC appointees to clarify responsibilities for travel entitlements.

Travel & Hospitality Administration: The officer responsible for financial administration within the respective SDAs should provide, or reinforce, direction and monitoring to ensure appropriate rigour in the administration of travel and hospitality. This will include a requirement for appropriate pre-authorization and subsequent certification of claims by delegated authorities. Payments should not be authorized in the absence of applicable supporting documents.

All organizations accepted the travel and hospitality administration recommendation and are in the process of strengthening compliance in this area; in particular corrective action with respect to authorizations.

Pre-authorization (S32) – Measures to strengthen pre-authorization in organizations include: travel and hospitality pre-authorization forms, flagging of claims which are not pre-authorized, training sessions, increased awareness of pre-authorization requirements, and increased monitoring. Organizations have also taken steps to ensure deputy heads and GIC appointee's expenditures are pre-authorized by an independent delegated senior official.

Funds release (S33) and S34 Verification – Corrective actions to strengthen this area include the provision of additional training and awareness to managers regarding authorizations being signed and dated.

S34 Supporting documentation – Improved procedures and training to financial administration staff have been implemented to ensure compliance with section 34 verification. As an example in one organization, financial officers have been asked to increase the level of attention paid to supporting documentation; claimants are contacted to obtain missing documentation, and a manager's approval must be provided along with a written explanation of the expense.

All training on travel and hospitality administration procedures is on-going and procedure improvements have been implemented as of the end of the fiscal year 07/08.

Organizations have updated their delegation of authorities chart. Updated delegation charts should be approved by the end of the fiscal year 09/10 with updates being made as necessary e.g. with a change of Minister or Chairperson.
Hospitality Policy Interpretation: SDAs should ensure that the applicable requirements are clearly communicated and understood by their employees and GIC Appointees and that clarification is sought as required. Organizations have adopted measures to communicate hospitality policy entitlements including: recognizing the requirement for full proactive disclosure for hospitality expenses; ensuring forms include number of attendees, purpose, details, cost; increasing requirements for supporting documentation; training and information sessions for managers and written clarification on hospitality policy for GIC appointees. These actions will be complete by the end of 2008.
Training: SDAs should ensure that sufficient training is provided for their employees that addresses the FAA, Travel Directive and Hospitality Policy, the Special Travel Authorities, Terms and Conditions of Employment for Full-time Governor in Council Appointees, Payments and Settlements Requisitioning Regulations 1997, SDA-specific authorities and delegation instruments. All organizations responding indicated that they would provide their employees with further training in the form of meetings, information sessions, or individual training, on the Financial Administration Act, Travel Directive, and Hospitality Policy. All training sessions should be completed by the end of the fiscal year 08/09.
Electronic Authorization: SDAs should consult with the Office of the Comptroller General and Chief Information Officer Brach, to ensure that processes for electronic authorization of travel and/hospitality claims meet applicable requirements to achieve and demonstrate compliance with the TB Policy on Electronic Authorization and Authentication, and, correspondingly, the Financial Administration Act.

This recommendation was directed to three organizations. Two organizations have been working with their electronic service providers to ensure compliance with TBS policies.

The third organization did not agree with the auditor's observations. Although they do complete FAA Section 34 electronically, they complete their verification in compliance with the Communications Security Establishment process and do not believe change from this practice is necessary.