Report on the Audit of Cost Recovery (Phase 2) including the Impact of the New Funding Model
5. Audit Objective
The audit objective was to provide assurance that cost recovery business processes have been standardized and streamlined.
6. Audit Scope
Based on the results of a risk assessment, the scope of the audit focused on 2014-15 cost recovery business processes with respect to:
- Legal service agreements (i.e. Memorandum of Understanding (MOU) and Planning and Forecasting Annex (Annex B));
- Quality control in support of monthly invoicing, specifically the Manager Billing Review and Approval process and the Final Billing Quality Assurance (QA) Review and Approval process; and
- Collection of cost recovery Accounts Receivable.
Recognizing that the Department is shifting to a new Envelope Funding/Advance Payment cost recovery model, current business processes were reviewed within this new context.
7. Audit Approach
The audit team carried out its mandate in accordance with Treasury Board’s Policy on Internal Audit and the Internal Audit Standards for the Government of Canada. The audit employed various techniques including a risk assessment, interviews, file reviews, observation testing as well as reviews and analysis of documentation and information.
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