Archived – Audit – Canadian Coast Guard – Marine Communications and Traffic Services
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Memorandum to the Commissioner
- The 2009-10 to 2011-12 Multi-year Risk-based Audit Plan included an Audit of Marine Communications and Traffic Services for the 2011-12 fiscal year. At the September 25, 2009 meeting of the Departmental Audit Committee, it was agreed to advance this audit to the current fiscal year.
- A formal audit report has not been prepared as the audit has not identified deficiencies that would warrant recommendations and a management action plan.
- The audit team did observe minor deficiencies however, which Program management had already identified and begun to address.
- These observations are presented below, along with the results of additional analysis undertaken.
- The memorandum will be included in the Departmental Audit Committee binder provided to the Deputy Minister on May 17, 2010. The memorandum will be tabled for approval at the June 17, 2010 Departmental Audit Committee meeting.*
- Please provide your concurrence by signing and returning this document to Internal Audit Directorate (IAD) by May 14th, 2010.
Safety of mariners and environmental protection in Canadian waters is highly dependent on the efficient and timely communication of information. With Centres located across Canada, the Marine Communications and Traffic Services (MCTS) program is the Canadian Coast Guard’s communication backbone. To ensure safety of life at sea, efficiency of navigation and the protection of the marine environment, some 400 MCTS Officers staff the 22 MCTS Centres that are in constant communication with mariners in Canadian and adjacent waters, 24 hours per day, 7 days per week.
The mission of MCTS is to provide communications and traffic services for the marine community and for the benefit of the public at large to ensure:
- Safety of life at sea in response to international agreements;
- Protection of the environment through traffic management;
- Efficient movement of shipping; and
- Information for business and the national interest.
Within the Canadian Coast Guard, MCTS provides the initial response to ships in a distress situation, reduces the probability of ships being involved in collisions, groundings, strikings, and is a cornerstone in the marine information collection and dissemination infrastructure. The safety of ships at sea and on inland waters is highly dependent on efficient distress response, traffic regulating, safety communications, the broadcasts of weather and navigation warnings and the alerting network. The public at large benefits through the protection of water supplies, the marine ecosystem, and the littoral environment. The broad national interest is served through data provided to other government departments for better management of national programs.
MCTS delivers these services with direct program resources totaling $40.4 million. The Program operates under a regulatory framework based primarily on the Canada Shipping Act, 2001, the Arctic Waters Pollution Prevention Act, the International Maritime Organization Search and Rescue Convention, the Safety of Life at Sea Convention, and the International Telecommunications Union - Radio Regulations.
The 2009-10 to 2011-12 Multi-year Risk-Based Audit Plan included an Audit of Marine Communications and Traffic Services for the 2011-12 fiscal year. At the September 25, 2009 meeting of the Departmental Audit Committee, it was agreed to advance this audit.
A formal audit report has not been prepared as there were no major deficiencies noted for which recommendations needed to be developed and a management action plan prepared to address. The audit team did observe minor deficiencies which Program management had already identified and begun to address. These observations are presented below along with summary results of additional analysis undertaken with respect to the Program.
In accordance with the Treasury Board Secretariat Policy on Internal Audit, the Internal Audit Directorate has adopted a comprehensive approach to the planning of audits, including conducting a Preliminary Survey. The Preliminary Survey included document review and analysis and interviews with Headquarters and Regional officials. Documents reviewed included MCTS Program documentation, the 2009-2010 MCTS Risk Profile, along with information on the Program web-site. In addition, the audit team consulted extensively with Program managers and staff, including discussing proposed audit objectives with the MCTS Regional Superintendents at their January 2010 National Meeting.
The audit team conducted a risk assessment as part of the planning phase, and no major risks in the Program were identified, from an audit perspective. In the course of our planning, however, a number of issues were noted and deemed worthy of additional audit work to determine their impact on the Program. As such, the objectives of the audit, which you have approved in the Terms of Reference, were defined as follows:
- To determine the extent to which MCTS has consistent governance and control processes in place for managing its Program.
- To assess the adequacy of the framework governing client and partner engagements.
The audit team developed an audit program to obtain the necessary evidence to report back on the above noted objectives. The audit program included questionnaires which were completed by regional and headquarters staff, follow-up interviews, and additional document review and analysis.
The findings of the audit team were consistent with findings of a strategic examination undertaken by program management. An action plan had been prepared by program management and tabled at the Maritime Services Executive Board. Actions from this plan were already underway to address some of the issues raised.
The audit team found Program governance and control processes in place; however there were opportunities to further strengthen the governance and control processes. Specifically, the audit team found that the Program does not have a mandate statement; one has been developed and is awaiting approval by Maritime Services Executive Board. A mandate is a key component of a Program’s governance framework as it is where program objectives are clearly identified and defined. The mandate of a program identifies the linkages to the departmental mandate, enabling legislation and regulations for the program and the major policy approvals that provide a context to understand the program and its activities.
The Program has clearly defined its mission and program objectives, thus lessening the impact of not having a mandate statement. However, the absence of a mandate statement has led to differences in perception of the mandate by regional and headquarters staff. Headquarters staff identified seven services being provided by regions that they perceived as being outside the mandate for the Program. When asked, regions perceived these same services as being within the mandate. A clearly defined and communicated mandate would help ensure all staff has a common understanding of the Program and its activities. A clear focus on resourcing for, and delivering on, core services is important within the context of budgetary restraints.
As well, the mandate for a program should be continually reviewed and revised to reflect changes in the regulatory and operating environment. A number of regions raised questions regarding the Program’s role with respect to Maritime Security. The approval by Maritime Services Executive Board and promulgation of the Program’s mandate will provide a common foundation for the Program.
A key component to a program’s governance and control processes relates to the role assumed by headquarters. MCTS is a national program delivered in each of the Canadian Coast Guard regions. As a national program, one would expect a reasonably consistent level of program delivery in each region, subject to any region’s specific requirements. One way to ensure regional consistency is through the use of national policies and procedures. The audit team found that the Program does have a Standards Manual; however regions can adapt the manual without notifying or requiring approval from headquarters.
The Office of the Auditor General has commented extensively on the issue of national consistency and the role of headquarters. Most recently in its February 2007, Chapter 4 A Status Report of the Auditor General of Canada to the House of Commons, they stated “In our previous two reports on the Coast Guard, we highlighted the fact that its five regions operate differently, and we concluded that five regional coast guards existed. During this follow-up audit, we found that there continue to be inconsistencies in regional procedures, practices, and organizational structure. We also found that the Coast Guard’s headquarters still does not hold the regions accountable for their operational results or for the Coast Guard’s service to its clients. Regions deliver all Coast Guard services. The Coast Guard has yet to strike the right balance between appropriate national directions and guidance and responsive, accountable regional delivery.”
Given the concerns raised by the Office of the Auditor General, MCTS should implement a process whereby Regions should, at a minimum, inform headquarters if they need to adapt national policies and preferably receive written approval to do so.
In addition to ensuring safe marine navigation, MCTS supports economic activities by optimizing traffic movement and facilitating industry ship/shore communications. All of these functions are derived from a regulatory framework. A national quality assurance program is a key element in a program’s governance and control framework. A quality assurance program would systematically assess operations to ensure procedures are being followed according to established standards and examine the standards themselves to identify areas requiring revision. Not only does a quality assurance framework identify opportunities for improvement and corrective actions, but it also provides follow up to ensure that corrective actions have been completed. Implementation of a national quality assurance program will mitigate the risk that the Program is not being delivered in accordance with its regulatory framework and compromising the safety of mariners.
MCTS does not have a national quality assurance program in place. Each region has developed their own quality assurance processes and they are performed to varying levels depending on the availability of regional resources. The results from the regional quality assurance processes undertaken are not systematically communicated to headquarters, therefore headquarters has no means of ensuring the Program is being delivered in accordance with its regulatory framework and established standards.
Client and Partner Engagements
The second objective of the audit focused on the adequacy of the framework governing client and partner engagements. The safety of mariners is dependent on the efficient and timely communication of information by MCTS Centres on a 24/7 basis (24 hours per day, 7 days per week). A framework governing client and partner engagements is necessary for the identification of clients and partners, determination of accountabilities and responsibilities, and monitoring implementation of engagement plans. The audit team found there was no national framework governing client and partner engagements, and as a result, regions engaged clients and partners on an ad hoc basis. Program management had already identified this issue and a Client Engagement Strategy was under development.
As a Program, MCTS is heavily reliant on partners to ensure their technological and information needs are met in order to provide services to a vast and diverse client base on a 24/7 basis. MCTS has established levels of service and service standards including the operational availability of services and systems. As MCTS is reliant on partners, such as the Canadian Coast Guard - Integrated Technical Services for its technological needs, MCTS must have agreements in place with its partners to ensure services are received to enable MCTS levels of service and service standards are met.
As outlined above, the audit team has not identified deficiencies that would pose a significant risk to the Program. To assist the Program, the audit team identified areas that would be of importance to the Program and conducted additional preliminary research. The results of this research are presented below.
The audit team found that significant work had already been undertaken related to the number of centres. In 2003-2004, as part of the national MCTS Strategic Review – Phase II project, CCG engaged Consulting and Audit Canada to undertake a study to identify a more efficient service delivery model. Regional reports and a consolidated National report with options were prepared, however the decision was made to maintain the “status quo” with respect to the number of MCTS centres. Given the extensive study already undertaken, additional audit work was not warranted.
MCTS is in the process of conducting an Employee Workload Review. As work is currently underway in this area, additional work by Internal Audit would not be warranted at this time. The final area the audit team assessed to determine if additional work was required was equipment. As outlined in the 2009-2012 CCG Business Plan, MCTS has 12 capital projects currently underway, most of which are multi-year. As these are capital projects, there are already rigorous processes in place; therefore additional study is not warranted at this time.
In conclusion, while the audit team found deficiencies in the Program’s governance and control framework and the client and partner engagement framework, they were minor in nature and do not pose a significant risk to the Program. The Program had already identified these issues and prepared an action plan that was tabled at the Maritime Services Executive Board. As the Program is in the process of implementing its action plan, there would be limited value to producing a formal report and requiring the Program to develop a formal management action plan, therefore these findings are presented for your information and consideration. In conducting preliminary research in additional areas that may be of value to program management, the audit team found considerable work had already been undertaken in these areas, therefore additional audit work in these areas is not warranted at this time.
The memorandum will be included in the Departmental Audit Committee binder provided to the Deputy Minister on May 17, 2010. The memorandum will be tabled for approval at the June 17, 2010 Departmental Audit Committee meeting.*
__original signed by_____
Chief Audit Executive
___original signed by____
George Da Pont
Commissioner, Canadian Coast Guard
* The memorandum was approved at the Departmental Audit Committee meeting on June 17, 2010.
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