Mr. Chair, thank you for this opportunity to discuss our special examination of Defence Construction Canada.
Joining me is Marise Bédard, the principal who was responsible for the special examination audit.
As you know, a special examination seeks to determine whether a crown corporation's systems and practices provide reasonable assurance that its assets are safeguarded and controlled, its resources are managed economically and efficiently, and its operations are carried out effectively.
Our examination of Defence Construction Canada, or DCC for short, covered the period between November 2015 and June 2016.
We concluded that, based on the criteria established, there were no significant deficiencies in Defence Construction Canada's systems and practices that we examined for corporate management and management of contracts and services.
We also concluded that the corporation maintained these systems and practices during the period covered by the audit in a manner that provided the reasonable assurance required under section 138 of the Financial Administration Act.
While we provided a positive conclusion on the corporation's system and practices that we selected, I would like to draw the committee's attention to the weaknesses we identified that the corporation needs to address.
First, we found that the corporation's risk register didn't include all aspects of the corporation's exposure to fraud, such as the inability to detect or prevent fraud, corruption, and collusion. We found that the corporation's fraud-related systems and practices weren't complete, which in turn limited the ability of management and the board to manage the corporation's fraud risk strategically.
Second, we found that the corporation didn't manage or store required contracting information in an organized manner. This resulted in incomplete files.
Finally, despite having an internal process to verify that the corporation conducted its contract services according to its policies and procedures, the corporation didn't perform any verifications for the 2014-15 fiscal year. As a result, the corporation didn't know if it applied its policies and procedures as intended.
The corporation agreed with all of our recommendations and prepared an action plan in response to our concerns.
Mr. Chair, this concludes my opening remarks.
We would be pleased to answer any questions the committee may have.
Thank you.