Audit of Management Practices of Missions - Bamako

October 2020

Acronyms and symbols

ADM

Assistant Deputy Minister

CS

Common Services

CBS

Canada-based staff

CSDP

Common Service Delivery Point

CMM

Committee on Mission Management

DMCO

Deputy Management and Consular Officer

FAA

Financial Administration Act

FAS

Finance and Administration System

FINSTAT

Financial Status report

HOM

Head of Mission

HQ

Headquarters

LES

Locally Engaged Staff

LESMCB

Locally Engaged Staff – Management Consultation Board

MCO

Management and Consular Officer

PRIME

Physical Resources Information - Mission Environment

RCRB

Regional Contract Review Board

ToR

Terms of Reference

SQ

Staff Quarter

Background

In accordance with Global Affairs Canada‘s approved 2019-2020 Risk-Based Audit Plan, the Office of the Chief Audit Executive conducted a series of audits of management practices at select missions. An audit of the mission in Bamako was initiated as part of a pilot joint engagement with the Inspection, Integrity and Values & Ethics Bureau (ZID) to conduct simultaneous Inspection and mission audit projects.

The Embassy of Canada to Mali, in Bamako, is a medium-sized Mission comprising 48 staff:  19 Canada-based staff, and 29 locally engaged staff (LES). The Mission includes the following programs: Common Services and Consular; Development; Foreign Policy and Diplomacy Service; Trade; and Security & Emergency Management. National Defence is the one partner department present at the Mission.

The Common Services Program provides administrative and operational support to the Mission, and is responsible for financial transactions and human resources activities. The property, materiel, and transportation section is responsible for the maintenance of the Chancery (crown owned), Staff Quarters (17 leased SQs), inventory, and a fleet of 11 vehicles [REDACTED]. The Mission receives financial, contracting and procurement service support from the Common Services Delivery Point in Brussels (Belgium). The Program is managed by a Management and Consular Officer, and is supported by a Deputy Management and Consular Officer. The mission in Bamako is a hardship posting, and the local environment makes it challenging to manage mission operations.  Prior to the current management team’s arrival in August 2018, the International Platform Branch had assigned experienced officers to a series of temporary postings within Common Services with the objective of addressing management practices gaps and to stabilize operations.

Table 1 shows the Mission’s Common Services Program expenditures from 2017-18 to 2019-20.

1. Audit objective and scope

The objective of the audit was to determine whether sound management practices and effective controls were in place to ensure proper stewardship of resources at the Bamako Mission to support the achievement of Global Affairs Canada objectives.

This audit examined the Mission’s management practices related to the Common Services and Consular Services Programs at the Mission, with regard to accountability and oversight, planning and budgeting, local procurement, management of assets, cash and revenue, and Locally Engaged Staff (LES) salaries, between April 2017 and March 2020. Audit criteria are included in the respective observation sections. A site visit was conducted at the mission from March 2 – 11, 2020. The audit team provided a detailed verbal briefing to the Head of Mission, the Management and Consular Officer, and the Deputy Management and Consular Officer after completion of work onsite.

Recommendations

1. The Head of Mission should implement formal and up-to-date terms of reference documentation for all key mission committees to guide their functioning.
2. The Head of Mission should take measures so that appropriate procurement mechanisms are established and managed in compliance with the applicable departmental policies and procedures.
3. The Head of Mission should improve inventory lists such that they are accurate, updated on an ongoing basis, and include sufficient details to accurately identify, track the location, movement, the age, and condition of individual goods.

Statement of conformance

The audit was conducted in conformance with the Institute of Internal Auditors' International Standards for the Professional Practice of Internal Auditing and with the Treasury Board Policy and Directive on Internal Audit, as supported by the results of the quality assurance and improvement program.

2.  Observations and recommendations

2.1 Accountability and oversight

Audit criteria:

Adequate governance is in place to support proper stewardship of mission resources.

• Accountabilities, roles and responsibilities of mission management are established, clear, and communicated.
• Effective oversight is in place to support proper stewardship of resources.

Observation:

Management exercises appropriate oversight over common services and consular programming through key mission committees, and through individual managers’ accountabilities. Mission accountabilities, roles and responsibilities were clearly defined, communicated and understood by management and staff.  The Committee on Mission Management and the LES Management Consultation Board did not have up-to-date Terms of Reference in place. While the committees were operating effectively, a lack of formal guiding documents could impact the clarity regarding committee mandates, the make-up and frequency of meetings, and specific roles as committee members change through rotation.

Recommendation 1:

The Head of Mission should implement formal and up-to-date terms of reference documentation for all key mission committees to guide their functioning. 

2.2 Planning and budgeting

Audit criteria:

Planning and budgeting is based on needs and there is a rationale for planned activities and forecasted expenditures.

Observation:

Adequate practices were in place to ensure proposed budgets were in line with forecasted expenditures and planned operational needs.  In-year budget management was determined to be effective, with no significant and unexplained deficits or surpluses identified over the last two fiscal years.

2.3 Local procurement

Audit criteria:

Effective controls are in place to ensure that procurement of goods and services comply with relevant policies and legislative requirements and achieve value for money.

Observations are based on the examination of procurement processes, mechanisms, and tools, from initiation to payment, and included review of a sample of 48 procurement transactions and contracts, dating from April 2017 to March 2020.

Observations:

The mission had made positive changes and improvements to procurement practices over the previous 18 months. This included assessing quality of contractor work, and strengthening contract monitoring. Opportunities were identified, however, to improve overall procurement administration. Transaction testing identified the following gaps:

• Proper methods of procurement were not always used, including instances where purchase order were not created when required, or established after work was completed and/or goods were received.
• Procurement policies and procedures were not always followed, and sufficient due diligence was not always applied in establishing a contract. Examples include:
  • Exceeding mission’s contracting authority limit;
  • not receiving initial approval by the Regional Contract Review Board prior to initiating a contracting process;
  • Incomplete and unclear Request for Proposals and/or Statement of work;       
  • lack of clarity in the proposal evaluation and selection process;
  • proposal evaluation criteria either not developed, or not followed; and
  • Justification for sole source procurement not always on file.
• Contracts were not always effectively managed, including instances where approved invoices were not in line with the terms of a contract.
• Instances where the contracting authority approval, and invoice payment approval were completed by the same person, and not segregated as required.

Effective procurement controls are essential in reducing the mission’s risk of not receiving quality services, on time, at competitive prices, from reliable and trusted vendors.

Recommendation 2:

The Head of Mission should take measures so that appropriate procurement mechanisms are established and managed in compliance with the applicable departmental policies and procedures.

2.4 Asset management

Audit criteria:

Effective controls are in place to ensure that the management of assets (cash, and non-cash items) complies with relevant policies and legislative requirements.

Observations are based on an examination of the management of the following assets: property, vehicles, fuel, inventory, petty cash, and consular revenues.

Observation:

Controls are in place, and operating effectively, in the management of real property, vehicle fleet, and fuel. There is an opportunity to streamline controls over diesel fuel by increasing the use of vehicle fuel cards. The level of controls in place to manage mission cash was determined to be adequate, and in line with volume of cash on hand and level of risk. Some controls are in place over the management of the inventory of goods, although improvement is required with the accuracy of inventory lists, and the lack of tracking of life cycle information. Without this information, it is difficult for subsequent management teams to the track these crown owned items, and to appropriately plan and budget for their disposal and replacement.

Recommendation 3:

The Head of Mission should improve inventory lists such that they are accurate, updated on an ongoing basis, and include sufficient details to accurately identify, track the location, movement, the age, and condition of individual goods.

2.5 LES salary and overtime

Audit criteria:

Effective controls are in place to ensure LES salaries and overtime payments (in cash and time):

• comply with relevant policies and legislative requirements; and
• are accurate and complete.

Observations:

A review of a sample of salary transactions determined that payments were accurate, and annual rate of pay changes were made. The three overtime transactions reviewed were pre-approved, and the amounts paid were warranted and reasonable.

3. Conclusion

The audit concluded that sound management practices and effective internal controls were mostly in place. While there was noticeable recent improvement of the management practices and strengthened internal controls for the Common Services program, continued efforts are required in areas of local procurement, and inventory management. The Functioning of key oversight committees would benefit from the updating of terms of reference documents.

Appendix A: Management action plan