Finance committee  Once again, that involves assessing programs and activities, something we do not do. However, I am sure the agency will have statistics on that. Our work involves determining whether the agency is focusing on the highest-risk sectors, given the resources allocated to it. Does it have a model whereby it assesses risk and channels resources accordingly where the risks are highest?

Finance committee  I think that is probably a viable conclusion to make. We obviously don't have any evidence of this, but there are higher-risk sectors to which fewer resources are allocated than certain other sectors. A reallocation of these resources should lead to better performance.

Finance committee  Let me give you an example of an audit we conducted recently on trusts. There are two types of trusts, testamentary trusts and living trusts. The department dedicates a lot of resources to testamentary trusts because it has to issue a sort of certificate to indicate all taxes have been paid.

Finance committee  There were new agreements reached with the provinces within the past year. I think in part some of that was provoked by the issues that came in 2002, when there was an overpayment by the federal government and it created a lot of concern about the systems. There are new mechanisms that are built into that, and more accountability to the provinces.

Finance committee  I would hesitate to answer on behalf of the provinces. I think you should ask them.

Finance committee  As we mentioned, we wanted to begin an audit in 2004 to look at the new systems that were being put in place. The agency was really moving toward a very different system from what had existed previously when it was a department. When we got into that, we realized they were not as far advanced as we had initially thought they might be.

Finance committee  There was a bit of all three. When we do the survey phases, generally through interviews, we don't get into the actual audit per se. There were a number of issues. For example, with the competency profiles and so on, people were telling us they weren't done, but we didn't actually go and audit.

Finance committee  As I mentioned in the opening statement, we haven't specifically done an audit or looked at how all of the new flexibilities have been put in place, and I always hesitate to give grades, but I would say we have been very impressed by the accountability framework that has been put in place.

Finance committee  Thank you, Mr. Chair. We thank you for this opportunity to speak to the finance committee about our experience with the Canada Revenue Agency, as you carry out the five-year review contemplated in subsection 89(1) of the Canada Revenue Agency Act. Today I'm accompanied by Jamie Hood, the principal responsible for performance audits and the annual assessment of the agency's performance information, as well as Marion McMahon, the principal responsible for the annual financial statement audits that we conduct at the agency.

Canadian Heritage committee  Previously there were a lot, and I presume there still are a significant number, of contribution agreements between the department and Telefilm. So Telefilm wasn't able to determine the policy issues, was just carrying out the program for the department, if you will. It would be a bit like a subcontractor.

Canadian Heritage committee  Let me just perhaps clarify. The program is established by the department, and they'll say they will give funding for whatever, and these are the conditions. Telefilm actually decides who the individual contributions are made with, but Telefilm does not decide the policy issues around the program.

Canadian Heritage committee  It is my understanding that the criteria would be established by the department, but the actual choice of who receives the funding is made by Telefilm.

Canadian Heritage committee  Mr. Chair, may I just add a point? If you are getting into this discussion about the role that Telefilm plays, I think as was mentioned earlier you should be aware as well of the new relationship with the Canadian Television Fund, which is largely producers and others from the industry who are now establishing that kind of policy, and then Telefilm will carry that out according to the policy and the criteria that have been established by the Canadian Television Fund.

Canadian Heritage committee  No, we did not look at that program.

Canadian Heritage committee  We're just checking. I believe that support for official language communities was in the most recent grants and contributions audit we looked at, and we found that it was generally well managed. I would like it to be clear that we don't actually do effectiveness studies. That would be the department's responsibility; we would look to see if the department had carried that out.