Good afternoon, Mr. Chair. It is a pleasure to be here today.
Let me begin by thanking this committee for the invitation to appear to speak on this important topic.
The audit of procurement of consulting services was included in Global Affairs Canada's 2023‑25 internal audit plan, which was approved by the deputy minister of foreign affairs in June 2023.
The findings of the audit were presented and recommended for approval by Global Affairs Canada's departmental audit committee in December 2023 and subsequently published on our website, as part of the requirement set by the Policy on Internal Audit. The deputy minister of foreign affairs supported and approved this audit, recognizing its critical role in helping the department identify strengths and vulnerabilities.
The audit found that 79% of contracts were fully compliant with the Financial Administration Act. That is, 72 contracts were found to be fully compliant out of a total of 91 contracts assessed. Others were found to be partially compliant. Proactive disclosure of contracts over $10,000 was found to be fully compliant.
As a result of the internal audit, the department has been able to identify areas for further improvement of information management practices of the procurement processes to demonstrate compliance and support fair, open and transparent procurement. Global Affairs Canada is a big, complex department working in Canada and 182 missions abroad. In general, many of the issues flagged during the audit stem from the complexity of our operating environment.
Our procurement system has undergone significant improvements in the past two years. They include the implementation of an electronic signature solution aimed at mitigating the risk of inappropriate authority or lack of required segregation. Furthermore, the department has implemented additional controls, bolstering the effectiveness of our financial controls surrounding procurement. These measures collectively contribute to a more robust and reliable procurement process within our department. It is important to note that two-thirds, or 68%, of the contracts identified as having issues were signed prior to these adjustments being implemented.
On the first recommendation of reviewing the processes in place to ensure compliance with the requirements of the Financial Administration Act, the department has already implemented various tools and processes, including the electronic signature solution embedded in the automated Procure-to-Pay solution, an enhanced account verification procedure and updated training. The department is also in its final stage of revising the payment process framework, along with which a communication strategy including dashboards is being developed to enhance communication of financial results to senior management.
In response to the second recommendation to “put processes in place to ensure that information related to contract administration is accessible, preserved and retained throughout the procurement lifecycle to comply with applicable authorities and support fair, open, and”—