In the Department of Justice, the Contracting and Materiel Management Division (CMMD) in the Administration Directorate at headquarters has a Department-wide mandate to provide functional direction and training for managers and administrative officers on all matters relating to contracting, and to process service contracts valued at over $25,000. Contracting units in the regions manage contracts under $25,000. On January 24, 2007 the Deputy Minister issued a memorandum restricting regional contracting authorities to:
- service contracts under $10,000;
- service contracts under $25,000 that have been approved by a Regional Contracts Review Committee;
- procurement through a Standing Offer arrangement under $40,000.
Contracting groups in the regions are located within the regional corporate services functions, which are known as Corporate Services in British Columbia, Finance and Administration in the Prairie, and Financial Services in Quebec. For simplicity, this group is always referred to as Regional Corporate Services. The term ‘regional contracting’, which is used throughout the report, is applied as a consistent reference for the various contracting groups within the regional corporate services groups.
This audit focused on three regions and examined service contracts in fiscal years 2007-08 and 2008-09, a period during which 1,545 contracts were let with a value of $5,916,804. To conduct our examination, we chose a random statistical sample of contracts from the 660 service contracts that were (1) over $2,000, (2) not awarded by PWGSC, and (3) not expert witness or Crown counsel contracts. These contracts accounted for 89 percent of the total dollar amount contracted for in the three regions under review during fiscal years 2007-08 and 2008-09.
The key risk factors that were considered in relation to this audit entity included: compliance with Treasury Board (TB) and Public Works and Government Services Canada (PWGSC) rules with respect to contracting and DOJ policy and guidelines; appropriateness of linkages with headquarters contracting staff; the level of functional guidance received from headquarters; the level of understanding among regional staff of the contracting requirements; and the appropriateness of monitoring and control measures being applied. Other key risk factors identified by management included maintenance of documentation to support decisions taken by regional contracting, as well as the quality of contracting information.
1.2 Audit Objectives
The overall objective of this audit was to examine and assess the framework within which regional contracting activity is managed and the extent to which contracting activities are in compliance with government policies and rules.
1.3 Audit Scope
The audit focused on:
- the management control framework for the contracting function including processes and practices related to planning, organizing, controlling, directing, communicating, and the management of human, financial, and materiel resources;
- the Department’s contracting policies and practices and the review/challenge mechanisms, including the Regional Contracts Review Committee;
- the reliability of information contained in systems for decision making;
- compliance with Government Contracts Regulations, TB policies, and PWGSC policies and rules pertaining to contracting;
- the management of competitive and non-competitive contracts, from the selection of suppliers to the monitoring of work (including the receipt of deliverables and payment of invoices).
The audit included the operations and activities of the British Columbia, Prairie, and Quebec regional offices with respect to contracting (excluding Legal Agent appointments, expert witnesses, and contracting for goods). Footnote 1 In the Prairie Region, the audit focused on contracting activities related to the Edmonton Office. The file review and analysis of contracting activity in all three regions focused on purchase orders over $2,000.
The planning and on-site examination for this audit was carried out between September and December 2009. Details on the audit methodology employed are in Appendix B.
- Date modified: