CRA Annual Report to Parliament 2011-2012 (PDF - Agence du ...

Summary of the assessment of effectiveness of the systems
of internal control over financial reporting and the action plan
of the Canada Revenue Agency
Fiscal year 2011-2012
Annex to the Statement of Management Responsibility Including Internal Control over Financial Reporting.
Note to the reader
In accordance with the Treasury Board Policy on Internal Control, departments and agencies are required to demonstrate the
measures they are taking to maintain an effective system of internal control over financial reporting (ICFR).
As part of this policy, departments and agencies are expected to conduct annual assessments of their system of ICFR,
establish action plans to address any necessary adjustments, and attach to their Statements of Management Responsibility
a summary of their assessment results and action plan.
Effective systems of ICFR aim to achieve reliable financial statements and to provide assurances that:
transactions are appropriately authorized;
financial records are properly maintained;
assets are safeguarded from risks such as waste, abuse, loss, fraud, and mismanagement; and
applicable laws, regulations, and policies are followed.
It is important to note that the system of ICFR is not designed to eliminate all risks, but rather to mitigate risk to a reasonable
level with controls that are balanced with and proportionate to the risks they aim to mitigate.
The system of ICFR is designed to mitigate risks to a reasonable level based on an on-going process of identifying key risks,
assessing the effectiveness of associated key controls and adjusting them as required, as well as monitoring the system in
support of continuous improvement. As a result, the scope, pace, and status of departmental and agency assessments of the
effectiveness of their systems of ICFR will vary from one organization to another based on risks and taking into account their
unique circumstances.
The annual assessment of ICFR contemplated in the Treasury Board Policy on Internal Control is intended to be a
management self-assessment led and administered by the Chief Financial Officer and supported by senior management.
However, key external audit findings and results can contribute to this self-assessment. In the case of the CRA, federalprovincial
tax collection agreements contain an audit provision requiring the Auditor General to periodically perform a
review of the CRA’s internal controls relevant to the financial information provided under the agreements, and to report the
results to provincial and territorial finance Ministers. To fulfill these requirements, the Office of the Auditor General
periodically audits those aspects of the CRA’s self-assessment of ICFR that are relevant to the tax collection agreements. The
portion of CRA’s ICFR that is subject to audit under the agreements and the results of the control audits performed recently
by the Office of the Auditor General are described in Sections 3 and 4 of the Annex.
1. Introduction
This document is part of the CRA’s Statement of Management Responsibility Including Internal Control over Financial
Reporting for the fiscal year 2011-2012. As required by the Treasury Board Policy on Internal Control, this document provides
summary information on the measures taken by the CRA to maintain an effective system of ICFR. In particular, it provides
ANNUAL REPORT
2011-2012
CANADA REVENUE AGENCY