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2002 December Report of the Auditor General of Canada

December 2002 Report—Chapter 5

Exhibit 5.5—The Regional Pay System—Controls assessment

Civilian personnel costs for the Government of Canada are about $14 billion annually. Public Works and Government Services Canada (PWGSC) processes the government's payroll through its Regional Pay System. Departments and agencies maintain the central payroll master files used by the system to produce the biweekly payroll. PWGSC has incorporated key controls directly into the system, including authorities, edits, exception reports, reconciliations of control accounts, and segregation of duties. It has also implemented a structured program change management process that includes needs identification, program testing, and user acceptance prior to release into production. Departments maintain controls for the input, edit, and authorization of changes to the payroll master file by segregating duties surrounding data entry and verification and by ensuring that all errors are resolved. In addition, management and monitoring controls (such as comparing budgeted to actual expenditures, reviewing error analysis reports, and performing ratio analysis) are carried out by both PWGSC and departments to ensure the timeliness, accuracy, and completeness of payroll processing. On the basis of this assessment of the Regional Pay System control framework, we concluded that the controls met the objectives of the controls assessment.