Military Family Services Program
Compliance and Assurance Review
2014/2015 Fiscal Year
(NAME OF MFRC)
(Date of Compliance and Assurance)
(Name of MFRC) COMPLIANCE AND ASSURANCE REVIEW PROGRAM – Fiscal Year 2014-2015
Ref
MOU
6.3.1
MOU
6.3.2
MOU
6.3.3
2/13
Requirement
Method of verification
Observation
Mode of
review
Onsite
Military Family Resource
Centre (MFRC) is a
(federally/provincially/territor
ially) incorporated, not-forprofit organization in good
standing.
MFRC complies with the
provisions of its own
organizational bylaws.
Confirm with the province or territory
to ensure that MFRC is incorporated
in good standing at the time of the
audit.
Review bylaws.
Randomly spot check that Board
practices parallel provisions of the
bylaws. Cross check with Annual
General Meeting (AGM) and Board
minutes to verify. Focus on bylaws
that are relevant to the Memorandum
of Understanding (MOU). (Note
observations in Appendix A of audit
report.)
Onsite
MFRC ensures that it
adheres to applicable
labour legislation, which
forms the basis for its
employee policy, standards
and guidelines.
In order for the reviewer to confirm
that the MFRC adheres to applicable
labour legislation they should be
provided with a letter of opinion. This
letter would verify adherence to labour
legislation and would be signed by an
appropriate authority. It would not be
appropriate for this letter to be signed
by a member of the Board.
Onsite
(Name of MFRC) MFSP Compliance and Assurance Review Program: 2014/2015 Fiscal Year
MOU
6.3.4
In addition, and subject to
the applicable
(federal/provincial/territorial)
legislation under which it is
incorporated, ensure
appropriate representation
on its Board of Directors
consistent with:
1. Civilian family
members of serving
full-time Canadian
Armed Forces (CAF)
personnel,
constituting at least
51% of the voting
membership.
Ensure that Military Family Services
(MFS) requirements for Board
composition are met at the time of the
review.
Onsite
Review bylaws, Board minutes, AGM
report and AGM minutes to establish
that members of the local CAF
community had the formal opportunity
to nominate and elect members to the
MFRC Board.
Onsite
2. A minimum of seven
voting members (or
in communities of
less than 1000 CAF
personnel, five voting
members is
acceptable)
MOU 6.3.4
Item 4
3/13
3. A Commanding
Officer or a senior
member of the
command team as a
non-voting
representative.
MFRC must ensure
members of the local CAF
community have a formal
opportunity to nominate
and elect members to the
MFRC Board of Directors.
(Name of MFRC) MFSP Compliance and Assurance Review Program: 2014/2015 Fiscal Year
MOU 6.3.7,
6.3.20
MOU 6.3.10
MOU 6.3.11
MOU 6.3.12
4/13
MFRC develops and
submits its Request for
Funds, Service Delivery
Agreement, Quarterly
Financial, Service Level
Agreement, Supplemental
Agreement and
Performance Reports, in the
manner prescribed by MFS.
MFRC coordinates a
minimum of four meetings
per year with the local
Commanding Officer, the
MFRC Board Chair and the
MFRC Executive Director
MFRC conducts Community
Needs Assessment (CNA)
at least every three years.
MFRC clearly identifies the
Military Family Services
Program (MFSP) logo on all
printed material, signs,
website, advertising and
promotional material
intended to promote the
programs and services that
fall under the purview of the
MFSP.
Review applicable documents within
the last 12 months
Onsite
Review minutes of meeting within the
last 12 months
Onsite
Review Community Needs
Assessment completed within the last
36 months. Should reflect assessment
principles as per 2012 Tool Kit
.
Revision of at least six promotional
pieces, that are in accordance with the
MFSP National Graphics Standards
Manual (Version July 2011)
Onsite
(Name of MFRC) MFSP Compliance and Assurance Review Program: 2014/2015 Fiscal Year
Onsite
MOU 6.3.13
Privacy
Code and
Privacy
Official
language
Act and
MFSP
Parameters
for Practice,
Sect 3.
MFSP
Parameters
for Practice,
Sect 5
5/13
MFRC ensures that
formalized procedures are
in place to manage personal
information as
recommended in the MFSP
Privacy Code and
Base/Wing regulation as
applicable.
Recommendations from the
Commissioner of Canada
are also reliable business
practices.
MFRC provides services in
both official languages in
accordance with
Department of National
Defence (DND) standards
and the principles of family
support
MFRCs are expected to
report on the expenditure of
MFS provided funds;
therefore the MFRC chart
of accounts must
segregate these funds.
Verify that
 Procedures to protect and
manage personal information
exist
 Procedures to manage
complaints and enquires about
adherence to the Code exist
 Procedures to communicate
and train the staff about privacy
principle and accompanying
procedures exist
Onsite (physical
filing and
storing of
information)
Revision of at least six
communications pieces that reflect
that services are provided in both
official languages.
Onsite
Review chart of accounts to ensure
that MFS funds are identified and
therefore possible to track.
Onsite
(Name of MFRC) MFSP Compliance and Assurance Review Program: 2014/2015 Fiscal Year
MOU
7.3.1
MFRC uses funds provided
by the DND through MFS
exclusively for MFSP
Mandated Services in
accordance with MFSP:
Parameters for Practice and
its approved Service
Delivery Agreement.
MFSP
Parameters
for Practice,
Sect 5,
Letter
Funding
Notification
(actual
year)
MFRC uses funds provided
by DND through MFS to
support mandated services.
This may include
programming costs. The
following items may be
reviewed in the MFS
compliance review if
assistance is deemed
appropriate to ensure
partnership goals are
reached.
6/13
To confirm that MFS funds are being
appropriately expended:
 Verify that MFS funds are
segregated and therefore
possible to track.
 Review quarterly expenditure
reports and cross reference
with financial journal entries,
financial records and cancelled
cheques.
 Inspect invoices and receipts.
 Verify that quarterly reports are
in accordance with identified
budget items in the Service
Delivery Agreement.
 Monitor that these records
clearly indicate purpose for
which funds were expended.
To confirm that MFS funds are being
adequately used in relation to
potential Personnel Support
Programs (PSP) delivered services
and that a collaborative relationship
between PSP exists:
 Verify the membership list of
the Community Program
Committee (CPC, expand)
 Verify meeting minutes from
the previous two CPC
committee meetings
 Verify the agreed upon Service
Delivery Model between the
MFRC and local PSP.
(Name of MFRC) MFSP Compliance and Assurance Review Program: 2014/2015 Fiscal Year
Onsite
Onsite
MOU
7.3.1
7/13
Ensure proper control of
accountable documents.
Verify through sample review that the
following acceptable practices are
being followed:
 Proper serially numbered
documents are used for
processing the following
transactions:
a. cash receipts from
customers;
b. disbursement cheques;
and
c. charitable donation
receipts
Ask to see sample of records for
each.
 Serial documents are
recorded in a master control
log that is maintained by
someone independent of the
bookkeeper.
Ask to see log.
 Daily usage of serial
numbered forms are
controlled by someone other
than the bookkeeper.
Ask to see control system.
 Cash receipts are reconciled
to the value of the deposit.
Ask how this is being done and
ask to see sample.
 Independent verification of
serial numbered forms is
conducted semi-annually by
the Executive Director (ED).
(Name of MFRC) MFSP Compliance and Assurance Review Program: 2014/2015 Fiscal Year
Onsite
MOU
7.3.1
Proper internal control over
payroll
MOU
7.3.1
Invoices, receipts and/or
other records that
demonstrate the purpose for
which the funds were
expended will be held on
file at the MFRC for a
period of six years, and
made available to MFS or
its representative on
request.
8/13
Verify that the following acceptable
practices are being followed:
 If an external payroll service
provider is used, time sheets
and pay rates must be
approved by the Executive
Director. Ask to see sample of
completed timesheets.
 If payroll is completed in house,
payroll cheques must be signed
by the Executive Director who
must review and initial the
supporting payroll records. Ask
to see sample of supporting
payroll records.
Spot check records.
(Name of MFRC) MFSP Compliance and Assurance Review Program: 2014/2015 Fiscal Year
Onsite
Onsite
MOU
7.3.3
9/13
Follow generally accepted
accounting principles and
practices, as well as the
Canadian Institute of
Chartered Accountants
guidelines for Not for Profit
accounting.
Verify by reviewing annual financial
audit conducted by Public Accountant.
Verify by reviewing management letter
that accompanies financial audit.
The reviewer will meet with the
accountant in person or via phone and
discuss the annual audit process with
questions such as: did the auditor
meet with the ED, Board Chair and
Treasurer, who provided all of the
documents the auditor required, was
the audit done on the premises or
completely in the auditor’s own office?
Post audit, before the production of
final audited statements – did the
auditor debrief with the ED, Board
Chair and Treasurer? Did the auditor
present the financial statements at the
AGM? How many years did this
company audit the MFRC?
(Name of MFRC) MFSP Compliance and Assurance Review Program: 2014/2015 Fiscal Year
Onsite
MOU
7.3.3
10/13
Adequate segregation of
duties. Management should
follow acceptable guidelines
for segregation of duties to
prevent and detect both
intentional and unintentional
errors.
 separation of the
custody of assets
from accounting;
 separation of the
authorization of
transactions from the
custody of related
assets;
 separation of duties
within the accounting
function; and
 separation of
operational
responsibility from
record-keeping
responsibility
Verify that the following practices are
in place and the following duties are
segregated:
 cheques must be signed by two
authorized signing officers;
 source documents must be
attached to or presented with
cheques at the time of
signature, initialed by those
signing the cheques and
stamped “paid" to prevent
double payment;
 bank reconciliations must be
completed by the Treasurer or
third party and must be
approved by the ED;
 ED should have read-only
access to online balance and
transactions on the bank
account.
 all incoming cheques / mail are
received, opened and recorded
in a log by someone other than
the bookkeeper;
 incoming cheques are
immediately stamped with a
“For Deposit Only to MRFC
account #”; and
 bank deposit is taken to the
bank by someone other than
the individual who prepared it.
(Name of MFRC) MFSP Compliance and Assurance Review Program: 2014/2015 Fiscal Year
Onsite
MOU
7.3.4
The MFRC will provide to
MFS Quarterly Financial
and Performance Reports
in the format prescribed by
MFS, detailing the service
provided and funds
expended.
MOU
7.3.5
Subject to approval from
MFS, the MFRC may retain
up to a maximum of 10
percent of unexpended
funds within a given fiscal
year. Funds retained must
be expended in such a way
that is “in keeping with” the
overall goals and objectives
of the MFSP. Expenditure
of and future reporting on
the use of the unexpended
funds will be in accordance
with MFS provisions.
11/13
Verify with MFS that submissions of
quarterly financial reports are up to
date at the time of the audit.
Review quarterly reports for
prescribed format.
Ensure that the Board is reviewing
these reports at their meetings.
For assurance of accuracy in
reporting, compare the fourth quarter
of most recent fiscal year to the
figures reported in the audited
financial statement for that year.
If applicable:
 Confirm that approval from
MFS was obtained.
 Track expenditure of funds by
cross-referencing with financial
journal entries, financial
records and cancelled
cheques.
 Monitor that these records
clearly indicate purpose for
which funds were expended?
(Name of MFRC) MFSP Compliance and Assurance Review Program: 2014/2015 Fiscal Year
Onsite
Onsite
MOU
7.3.8
MFRC will obtain an annual
external and independent
financial audit conducted
by a designated Public
Accountant licensed in
his/her respective province.
MOU
8.1
The MFRC will obtain
property, liability, errors and
omissions and directors and
officer’s liability insurance
coverage in accordance
with the minimum standards
established by MFS.
12/13
Review audit and note any emergent
issues.
Review management letter that
accompanies audit and note salient
observations.
Verify that credentials of auditor
indicate that he/she is licensed in the
province.
Verify that accountant has no
connections other than professional
with the MFRC. Ensure that he or she
is “independent”.
Reviewer to ascertain what the
minimum standards established by
MFS are at the time of the visit.
Confirm with the insurance company
used by the MFRC that they have the
recommended level of insurance.
(Name of MFRC) MFSP Compliance and Assurance Review Program: 2014/2015 Fiscal Year
Onsite
Onsite
APPENDIX A
The reviewer will examine Board bylaws & policies and randomly select five provisions to spot check. The bylaws to be cross
checked must be relevant to the provisions of the MOU (i.e. Board composition; AGM requirements; requirement for an annual
financial audit; and so on). Using the table below, the reviewer will note five policies or bylaws. The reviewer will then verify the
extent to which these are put into practice via analysis of Board and AGM minutes as well as interviews with Board members
where appropriate.
Board Policy
Observation
A.1
A.2
A.3
A.4
A.5
13/13
(Name of MFRC) MFSP Compliance and Assurance Review Program: 2014/2015 Fiscal Year
Mode of
review
Onsite
Onsite
Onsite
Onsite
Onsite