annexe-annex

Transparency

Parks Canada Financial Statements

Annex to the Statement of Management Responsibility including Internal Control over Financial Reporting

Fiscal Year 2014-15

Table of contents

1. Introduction

This unaudited document is attached to Parks Canada’s Statement of Management Responsibility Including Internal Control Over Financial Reporting for the fiscal year 2014-15. This document provides summary information on the measures taken by Parks Canada to maintain an effective system of internal control over financial reporting (ICFR) including information on internal control management, assessment results and related action plans.

Detailed information on Parks Canada’s authority, mandate and programs can be found in the attached Departmental Performance Report and Report on Plans and Priorities.

2. Parks Canada's System of Internal Control Over Financial Reporting (ICFR)

Parks Canada recognizes the importance of setting the tone from the top to help ensure that staff at all levels understand their roles in maintaining effective systems of ICFR and is well equipped to exercise these responsibilities effectively. Parks Canada’s focus is to ensure that risks are well managed through a responsive and risk-based control environment that enables continuous improvement and innovation.

2.1 Internal control management

Parks Canada has a well-established governance and accountability structure to support departmental assessment efforts and oversight of its system of internal control. An internal control framework, approved by the Chief Executive Officer and Chief Financial Officer, is in place and includes:

  • Organizational accountability structures as they relate to internal control management to support sound financial management, including roles and responsibilities which span from senior managers across to PCA employees in their areas of responsibility for control management;
  • Internal control structure and management approach, which depicts the overall approach for internal control identification, documentation and evaluation;
  • Values and ethics; Parks Canada has recently updated the Values and Ethics Code. Parks Canada also has an Ombudsman whose mission is to promote and intervene in favour of an organizational culture based on the fundamental values of the Agency. The Ombudsman is also the Senior Integrity Officer for internal disclosure and wrongdoing;
  • Ongoing communication and training on statutory requirements, policies and procedures for sound financial management and control; and
  • Monitoring and regular updates on internal control management, as well as the provision of related assessment results and action plans to the Chief Executive Officer and the Audit Committee (AC).

The AC provides advice to the Chief Executive Officer on the adequacy and functioning of Parks Canada’s risk management, control and governance frameworks and processes.

2.2 Service arrangements relevant to the financial statements

Parks Canada relies on other organizations for the processing of certain transactions that are recorded in its financial statements as follows:

Common Arrangements:

  • Public Works and Government Services Canada centrally administers the payments of salaries through its payroll system, the procurement of goods and services and the provision of accommodation.
  • The Treasury Board Secretariat provides the Agency with contributions covering the employer’s share of employees’ medical and dental insurance premiums.
  • The Treasury Board Secretariat provides the Agency with information used to calculate various accruals and allowances, such as the accrued severance liability.
  • The Department of Justice provides legal services to the Agency.
  • Shared Services Canada (SSC) provides IT infrastructure services to the Agency in the areas of acquisition and provision of hardware and software, data centre and network services. The scope and responsibilities are addressed in the interdepartmental arrangement between SSC and the Agency.

Specific Arrangement:

  • Parks Canada’s financial system related functional services are shared with Canadian Heritage. The services are administered through an MOU whereby Parks Canada shares equally the expenses (incl. maintenance, training, user support, etc.) as well as the responsibilities and risks in relation to the financial system. The financial system’s Information Technology (IT) related services are provided by Agriculture Canada to both Parks Canada and Canadian Heritage through a separate MOU.

3. Parks Canada's Assessment Results During Fiscal Year 2014-15

During 2014-15, Parks Canada completed the first full assessment of the key controls including all the design effectiveness testing and its operating effectiveness testing. Ongoing monitoring is being implemented according to plan.

3.1 Design effectiveness testing of key controls

In the current year, the Agency completed design effectiveness testing of the Entity Level Controls and Accounts Payables business process.

As a result of design effectiveness testing, the Agency identified the following remediation required:

  • Accounts Payables: Greater consistency with regards to documentation and process requirements across business units.

Remediation of key control deficiencies were communicated and are currently being addressed.

No remediations were identified and need to be addressed for the processes covered in Entity Level Controls.

3.2 Operating effectiveness testing of key controls

Parks Canada has completed the operating effectiveness testing of the following key business processes – Entity Level Controls, Chart of Accounts, Accounts Payables, Capital Assets and Environmental Liabilities. 

As a result, the Agency identified the following remediations required:

  • Capital Assets: Review and communicate standardized procedures and implement a risk based monitoring approach.
  • Accounts payables: Review and communicate standardized procedures and documentation requirements with regards to expenditure initiation and payment processes across all business units, including associated roles and responsibilities.

Remediation of key control deficiencies were communicated and are currently being addressed.

No remediations were identified for the processes covered in Entity Level Controls, Chart of Accounts and Environmental Liabilities.

3.3 On-going monitoring of key controls

Parks Canada has completed the ongoing monitoring assessment of Revenue Management, IT General Controls and Financial Reporting in 2014-15. No remediations were identified for these processes. The Agency will continue its ongoing monitoring strategy and plan (see section 4.2 for more details).

4. Parks Canada Action Plan

4.1 Progress during fiscal year 2014-15

During 2014-15, the Agency has continued to make significant progress in assessing and improving its key controls and meeting its key commitments in last year’s action plan. Below is a summary of the main progress made by the Agency based in the action plan identified in the previous fiscal year’s annex:

Progress During Fiscal Year 2014-15
Element in previous year’s action plan Status

Governance & Accountability – Design and operating effectiveness

Design and Operating effectiveness testing completed. No remediation required.

IT General Controls – Ongoing monitoring

Ongoing monitoring completed for the Travel System and Parks Canada Reservation System processes. No remediation required.

Chart of Accounts – Operating effectiveness

Operating effectiveness testing completed. No remediation required.

Accounts Payables - Design and operating effectiveness

Design and Operating effectiveness testing completed, corrective measures identified and currently being addressed.

Revenue Management – Ongoing monitoring

Ongoing monitoring testing completed. No remediation required.

Capital Assets - Operating effectiveness

Operating effectiveness testing, corrective measures identified and currently being addressed.

Environmental Liabilities – Operating effectiveness

Operating effectiveness testing completed. No remediation required.

Financial Reporting – Ongoing monitoring

Ongoing monitoring completed for Financial Statements and Public Accounts processes. No remediation required.

4.2 Status and action plan for the next fiscal year and subsequent years

Building on progress to date, the Agency has completed the full assessment of its system of internal control over financial reporting in 2014-15. At this time, the Agency will be applying its rotational ongoing monitoring plan to reassess control performance on a risk basis across all control areas. The status and action plan for the completion of the identified control areas for the next fiscal year and for subsequent years take into account certain corrective measures and anticipated business process transformations which may require a full cycle of implementation before operational effectiveness testing may take place.

Key Control Areas Documentation Design effectiveness testing Operational effectiveness testing On-going monitoring rotation1
Entity Level Controls
Governance & Accountability Completed Completed Completed 2016-17
IT General Controls under Departmental Management
IT General Controls Completed Completed Completed 2017-18
Parks Canada Reservation Service (PCRS) Completed Completed Completed 2017-18
Shared Travel Services (STS) Completed Completed Completed 2017-18
Business Processes Controls
Chart of Accounts Completed Completed Completed 2017-18
Accounts Payable Completed Completed Completed 2015-16
Revenue Management Completed Completed Completed 2016-17
Capital Assets Completed Completed Completed 2015-16
Environmental Liabilities Completed Completed Completed 2017-18
Financial Reporting Completed Completed Completed 2015-16
Pay Administration*       2015-16

*Based on Risk Assessment and Government of Canada Transformation of Pay Administration Initiative

1 The frequency of the on-going monitoring of key control areas is risk-based and may occur over a multi-year cycle.

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