2013 Spring Report of the Auditor General of Canada Chapter 11—Special Examinations of Crown Corporations
2013 Spring Report of the Auditor General of Canada
Chapter 11—Special Examinations of Crown Corporations
Special Examinations of Crown Corporations
11.1 This chapter presents the main points of special examination reports of Crown corporations that were issued to the corporations’ boards of directors since our 2012 Spring Report and have to be subsequently made public. The Office of the Auditor General transmitted the reports at different dates, and we examined the corporations’ systems and practices during differing time periods.
Importance of Crown corporations
11.2 A Crown corporation is a distinct legal entity having a name, mandate, powers, and objectives set out in the constituent legislation for its parent Crown corporation or in articles of incorporation under the Canada Business Corporations Act. There are two types of Crown corporation. A parent Crown corporation is wholly owned directly by the Government of Canada, while a subsidiary is wholly owned by another Crown corporation.
11.3 Crown corporations have more autonomy than most other government entities, partly because they have commercial as well as public policy objectives. They account for a significant portion of government activity and operate in many sectors of the Canadian economy, including transportation, energy, agriculture and fisheries, financial services, culture, and government services.
11.4 As of 31 December 2012, there were 47 parent Crown corporations and one subsidiary that was directed to report as a parent Crown corporation. These entities employed over 88,000 people.
11.5 Crown corporations manage more than $400 billion in assets. That figure excludes total asset holdings of the Bank of Canada, the Canada Pension Plan Investment Board, and the Public Sector Pension Investment Board because of the unique nature of these entities’ operations. Crown corporations fund their operations in a variety of ways. Some corporations receive no parliamentary appropriations because their enabling legislation requires them to be financially self-sustaining. Some are funded mainly through parliamentary appropriations. Others receive federal funding but also generate revenue. In the 2011–12 fiscal year, 27 corporations received just over $6 billion in appropriations.
11.6 A board of directors or a similar governing body oversees the management of each corporation and holds management responsible for the corporation’s performance. In turn, the board of a parent Crown corporation is accountable to Parliament through the responsible minister.
Role of the Office of the Auditor General
11.7 Under Part X of the Financial Administration Act, the Auditor General is appointed to conduct annual audits of the financial statements and perform periodic special examinations of Crown corporations, either on his own or jointly with a private-sector audit firm, unless he waives the appointment.
Objective of a special examination
11.8 A special examination is an important accountability mechanism for a Crown corporation. Its objective is to provide an independent opinion on whether there is reasonable assurance that the corporation has systems and practices in place to ensure that its
- assets are safeguarded and controlled,
- financial, human, and physical resources are managed economically and efficiently, and
- operations are carried out effectively.
11.9 Any major weakness in the key corporate systems and practices that could prevent a corporation from achieving these objectives is reported as a significant deficiency. When planning a special examination, we conduct a risk analysis to identify the systems and practices that we consider essential to providing the corporation with this assurance. We also establish criteria that we use to examine the corporation’s systems and practices. These criteria are based on our experience with performance auditing and our knowledge of the subject matter. We select the criteria in consultation with the corporation.
11.10 The opinion we present in the special examination report may take one of three forms. First, we may find there is reasonable assurance that no significant deficiencies exist in the systems and practices the corporation maintains to achieve the objectives noted above. Second, we may find one or more significant deficiencies. Finally, in rare situations, we may find there is no reasonable assurance that the corporation’s systems and practices achieve the objectives.
11.11 Under the Financial Administration Act, a Crown corporation must undergo a special examination at least once every 10 years. However, special examinations could be carried out more often if required by the Governor in Council, the appropriate minister, the board of directors of the corporation, or the Auditor General.
11.12 As part of the accountability mechanism for a Crown corporation, the examiner reports on the special examination to the corporation’s board of directors. Further, the examiner may bring information from the special examination to the attention of the appropriate minister after consulting with the board of directors. The examiner may also bring information to Parliament’s attention, after consulting with the appropriate minister and the board of directors, by preparing a report for inclusion in the corporation’s next annual report.
11.13 The Financial Administration Act requires the corporation’s board of directors to submit any special examination report to the appropriate minister and the President of the Treasury Board within 30 days of receiving it. The Act also requires the board of directors to make the report available to the public within 60 days of receiving it.
Special examination results
11.14 Since our 2012 Spring Report to Parliament, the Office of the Auditor General issued reports, that are required to be subsequently made public, on special examinations of the following Crown corporations:
- Farm Credit Canada
- Canadian Broadcasting Corporation
- Old Port of Montréal Corporation Inc.
11.15 We identified no significant deficiencies in these special examination reports. However, in the case of the Old Port of Montréal Corporation Inc., we have some concerns about situations where considerable improvements should be made to the management of travel and hospitality expenses. We also found that some decisions that management made were not always properly documented. We describe these issues in detail in the section entitled “Matters of Concern.”
11.16 A special examination highlights systems and practices that contribute to success, and it provides information and recommendations to the corporation’s board of directors about other opportunities for improvement. For the three Crown corporations, our recommendations focused primarily on corporate governance, strategic planning, risk management, human resources, core operations sectors, information technology, and performance management.
11.17 Since 2008, we have reported annually on the special examinations transmitted each year. Cumulatively, we have reported on 32 special examinations; of these, 8 had significant deficiencies and 24 had none. As noted earlier, we transmitted the reports to the corporations’ boards of directors on different dates during each year, and we examined the entities’ systems and practices during differing time periods. We have not performed follow-up audit work regarding any of the matters raised in these reports.
11.18 The next section presents the main points from the three special examination reports, as well as the matters of concern included in the report to the Board of the Old Port of Montréal Corporation Inc.
Extracts of Special Examinations
Farm Credit Canada—Main Points
[The examination work covered the period from May 2011 to February 2012. For the full report and our recommendations, please go to www.fcc-fac.ca or contact the Corporation.]
What we examined
Farm Credit Canada (the Corporation) is a self-sustaining Crown corporation established in 1959. It provides financial products, knowledge, and services to farming operations, including family farms, and to rural farm-related businesses. Farmers represent 87 percent of the Corporation’s customers, and suppliers and processors represent 13 percent.
Investing in and supporting agriculture and the agri-food industry gives the Corporation responsibility for managing an investment portfolio of $22.6 billion. Its loan portfolio has increased from $13 billion in March 2007 to $22.6 billion in March 2012.
The Corporation has over 1,500 employees and operates out of 100 offices located primarily in rural communities. It reports to Parliament through the Minister of Agriculture and Agri-Food.
We examined whether Farm Credit Canada’s systems and practices provide it with reasonable assurance that its assets are safeguarded and controlled, its resources are managed economically and efficiently, and its operations are carried out effectively. We focused on the areas of governance, strategic planning and enterprise risk management, performance measurement and reporting, lending, treasury and investment management, human resources, and information technology. Our examination work was completed on 29 February 2012.
Why it’s important
The Corporation operates within two major industries—agriculture and finance—both of which are shaped by global trends and market forces such as the global financial crisis, continued consolidation of the agriculture industry, climate change, and changing demographics and markets. The agriculture and agri-food industry is a major contributor to the Canadian economy, employing more than two million Canadians, with total exports worth billions of dollars annually.
What we found
We found no significant deficiencies in the Corporation’s systems and practices. This means the Corporation maintains systems and practices that provide it with reasonable assurance that its assets are safeguarded and controlled, its resources are managed economically and efficiently, and its operations are carried out effectively. A significant deficiency is reported when there is a major weakness in the Corporation’s key systems and practices that could prevent it from having that assurance.
We noted good practices in a number of areas. We also noted some areas where the Corporation would benefit from improving its practices.
- The Corporation has in place the key elements of a good governance framework. The Board has access to resources and information it needs to provide appropriate stewardship and oversight. Roles and responsibilities are clearly defined and understood, and the Board is supported by a committee structure. The process used by the Board to self-assess its performance and competencies is not currently applied at the committee level. A more thorough analysis of the competencies and skills of committees would enable Farm Credit Canada to target training and get the most benefit from its committees.
- The Corporation has clearly defined and communicated its strategic direction. Performance is measured against strategic goals and objectives, but measures are focused on tasks rather than outcomes. As a result, the performance information and progress reported annually by the Corporation does not clearly reflect how successful it has been in achieving its critical outcomes and strategic objectives.
- The Corporation has put in place processes for identifying, measuring, monitoring, and reporting on risks. Risks are identified, monitored, and managed within divisions and at the corporate level. The Corporation’s lending and credit risk management activities are supported by a high-level framework and by policies and procedures that promote the achievement of the Corporation’s mandate and business objectives. While the Board is informed about the various risks, the information is fragmented. The Corporation would benefit from the position of a Chief Risk Officer as it would help senior management and the Board understand the interrelationships in various types of risks.
- The Corporation’s success relies heavily on the skills and knowledge of its people. A human resource management framework helps ensure that it has the human resource capacity and work environment it needs to achieve its goals and objectives. It has developed a workforce plan and a learning strategy, and has put in place a succession plan. However, management and disclosure of its compensation framework could be improved.
- The Corporation’s information technology management supports its strategic and operational objectives, ensures business continuity, and satisfies information needs in a timely manner.
The Corporation has responded. The Corporation agrees with our recommendations.
Canadian Broadcasting Corporation—Main Points
[The examination work covered the period from October 2011 to June 2012. For the full report and our recommendations, please go to www.cbc.radio-canada.ca or contact the Corporation.]
What we examined
The Canadian Broadcasting Corporation (the Corporation, or CBC/Radio-Canada) provides radio, television, and digital services with a wide range of programming, through regional, national and international services. In addition to a head office in Ottawa, the CBC/Radio-Canada has main network operations in Toronto and Montréal, as well as 27 television stations and 82 radio stations where it originates local programming, and 11 foreign bureaus. Its workforce of permanent, temporary, and contract employees totalled about 8,775 in March 2012.
The CBC/Radio-Canada is governed by a Board of Directors and reports to Parliament through the Minister of Canadian Heritage and Official Languages. About 62 percent of its funding comes from Parliamentary appropriations, and the remainder from advertising, specialty services, and other revenues.
We examined whether the Canadian Broadcasting Corporation’s systems and practices provide it with reasonable assurance that its assets are safeguarded and controlled, its resources are managed economically and efficiently, and its operations are carried out effectively. We focused on the areas of corporate governance, strategic planning and risk management, performance measurement and reporting, human resources, programming, financial management, technology management, real estate and space management, and environmental management. Our examination work was completed on 29 June 2012.
Why it’s important
As Canada’s national public broadcaster, the Canadian Broadcasting Corporation is required to make programming available across the country in a manner that satisfies both national and regional needs, while also reflecting the multicultural and multiracial nature of Canada. Services are offered in English, French and eight Aboriginal languages, as well as five languages for international audiences. No other Canadian broadcaster—commercial or public—has the responsibility to provide the same breadth of services or the same scale and scope of operations as the CBC/Radio-Canada.
What we found
We found no significant deficiencies in the Canadian Broadcasting Corporation’s systems and practices. A significant deficiency is reported when there is a major weakness in the Corporation’s key systems and practices that could prevent it from having reasonable assurance that its assets are safeguarded and controlled, its resources are managed efficiently and economically, and its operations are carried out effectively. We noted good practices in a number of areas. However, we also noted areas where the Corporation would benefit from improving some of its systems and practices, particularly in its management of human resources.
- The CBC/Radio-Canada has elements of a good corporate governance framework that meets the expectations of best practices for Board stewardship, shareholder relations, and communication with the public. Board members are provided with the necessary orientation and training. We noted that two important strategic plans did not receive timely approval.
- The Corporation has clearly defined its strategic direction. While the Corporation remains an arm’s length organization, it has taken into account government priorities, and has specific measurable goals and objectives aimed at achieving its mandate. Strategic planning is informed by identification of risks, and operational plans are aligned with the strategic plan. A performance measurement framework is in place, addressing the significant deficiency identified in our 2005 special examination report. Performance indicators have been identified and implemented, although there are no people management measures included in the framework.
- We noted a number of weaknesses in the Corporation’s systems and practices for human resources that could impede its ability to attract, recruit, develop, and retain employees. Despite recent steps to address recruitment and staffing issues, competency profiles do not exist for most occupational groups. In addition, the division responsible for human resources has not had consistent leadership since 2008. During that period the Corporation has had several different strategic plans for human resources. Because of this level of change in strategic direction over a relatively short time, the Corporation risks spending more time and energy on planning rather than on implementing initiatives and moving forward.
- The CBC/Radio-Canada has in place an IT security policy aimed at controlling and protecting the Corporation’s IT assets and maintaining data integrity and confidentiality. It also has guidelines containing principles and best practices for security. However, the current policy does not address the handling of sensitive information normally considered to be classified or protected under government policy. We noted examples where the Corporation did not classify and handle sensitive information appropriately.
The Corporation has responded. The Corporation agrees with our recommendations.
Old Port of Montréal Corporation Inc.—Main Points
[The examination work covered the period from May 2011 to December 2011. For the full report and our recommendations, please go to www.clc.ca or contact the Canada Lands Company.]
What we examined
The Old Port of Montréal Corporation Inc. (the Corporation) was formed in 1981 under the Canada Business Corporations Act and is a wholly owned subsidiary of Canada Lands Company Limited (CLCL). On 29 November 2012, the Governor General in Council authorized CLCL to merge with its subsidiary when it deemed the time was right. Up until that date, the Old Port of Montréal Corporation Inc. had been considered a parent Crown corporation pursuant to certain provisions in the Financial Administration Act.
The Corporation’s mandate is to showcase the Old Port of Montréal, to promote development of the site, and to administer, manage, and maintain the assets of the Corporation as a site for cultural and urban recreational tourism. The current site of the Old Port of Montréal represents a total area of about 41 hectares, and stretches for about 2.4 kilometres along the shore of the St. Lawrence River.
We examined whether the systems and practices that were in place between May and December 2011 at the Old Port of Montréal Corporation Inc. provided it with reasonable assurance that its assets were safeguarded and controlled, its resources were managed economically and efficiently, and its operations were carried out effectively. We focused mainly on the areas of corporate governance, strategic planning, risk management, human resource management, information technologies, operations, and asset management.
In addition, in response to a request from the Governor General in Council on 15 May 2012, we also looked at certain practices of the Corporation, particularly those related to travel and hospitality expenses. This additional audit work covered the 2006–07 to 2012–13 fiscal years, and our findings have been taken into account throughout this report.
Why it’s important
The Old Port of Montréal is a popular recreational tourism site and one of the most important in Canada. In the 2011–12 fiscal year, it attracted close to 6.6 million visitors. Through the Old Port of Montréal Corporation Inc., the Government of Canada aims to protect and promote Canadian cultural heritage and contribute to economic development, among other things. The government also aims to improve urban living conditions and facilitate public access to the waterfront without interfering with the port’s activities.
What we found
We found no significant deficiencies in the Corporation’s systems and practices. A significant deficiency is reported when there is a major weakness in the Corporation’s systems and practices that could prevent it from having reasonable assurance that its assets are safeguarded and controlled, its resources are managed efficiently and economically, and its operations are carried out effectively. We found good practices in a number of areas. However, in other areas, we found there was room for improvement, especially with respect to the Corporation’s management of travel and hospitality expenses, as well as documentation of management decisions.
- The Corporation has good governance practices. The Board of Directors has developed a profile of the skills and knowledge required by its members, and the roles and responsibilities of members are clearly defined. The Corporation has adopted a code of ethics and professional conduct for management and staff. However, the Corporation has done little to raise awareness about the application of the mechanisms that are in place for reporting situations that are not in compliance with the code.
- The strategic planning process that the Corporation has adopted allows it to align its programs and activities with its strategic objectives. The Corporation’s operational marketing plan supports the achievement of the objectives set out in its business plan.
- Corporation management is aware of the key risks to which the organization is exposed. Several components of a risk management framework are in place in the Corporation, particularly for operational risks. However, risk management is not yet fully integrated, and the Corporation does not have a complete analysis of the risks that have been identified. There is no formal mechanism for monitoring operational risks or identifying new risks.
- The Corporation negotiates with concession holders who operate concession businesses from which the Corporation collected about $2.8 million in revenue in the 2011–12 fiscal year. However, the Corporation did not have in place any documented and approved policies, procedures, processes, or controls to ensure that its agreements with concession holders were well managed. This lack of documentation on file to support decisions and practices resulted in a case-by-case management approach.
- The Corporation continually monitors the current physical condition of its assets. It uses the data it gathers to implement a preventive and corrective maintenance program that is based on an assessment of priorities and resources allocated by the government.
- The Corporation places great importance on customer service. It has established standards and practices for providing quality service and following up on complaints received. It has also developed a security management framework that sets out the security measures in place to protect all of the Corporation’s resources, whether human, material, financial, or information technology.
- The Corporation must significantly improve its systems and practices in order to ensure the sound management of travel and hospitality expenses. The Corporation’s policy in this area allows a great deal of discretion to those claiming and approving claims. Some travel and hospitality expenses claimed by management were not examined properly as a result of weaknesses in the Corporation’s practices.
- Several times during our examination, we found a lack of documentation. The Corporation’s systems and practices, as well as management decisions, should be based on complete, reliable, and accessible documentation, rather than on staff knowledge. Better documentation would, among other things, reduce the risk of losing corporate memory, and would enhance the efficiency, transparency, and accountability of management. Furthermore, proper documentation would show that management had met its responsibilities with respect to the Corporation’s policies.
The Corporation has responded. The Corporation agrees with our recommendations.
Old Port of Montréal Corporation Inc.—Matters of Concern
This section outlines our concerns regarding the Corporation’s management of travel and hospitality expenses, as well as certain systems and practices, and management decisions that were not always properly documented.
Travel and hospitality expenses
Corporation staff may be required to travel to perform their duties. Similarly, the Corporation can hold events to facilitate its business activities or as a matter of courtesy.
We wanted to see whether the Corporation had adopted effective monitoring and control mechanisms to determine whether travel and hospitality expenses were acceptable and whether they were managed in keeping with the applicable statute and policies. To that end, we examined the Corporation’s relevant policies and procedures as well as the processes and controls that had been implemented.
The travel and hospitality expenses for the Corporation as a whole totalled on average around $200,000 per year. We examined the travel and hospitality expenses that the President and CEO incurred during the 2006–07 to 2012–13 fiscal years, a sample of the travel and hospitality expenses that vice-presidents and directors incurred during the 2010–11 and 2011–12 fiscal years, as well as those incurred by the Corporation’s Board of Directors during the 2009–10 to 2012–13 fiscal years.
Overall, we found that the Corporation needed to make major improvements to its systems and practices to ensure these expenses are managed properly.
The Corporation does not have a clear and complete policy on travel and hospitality expenses
The Corporation adopted a travel and hospitality policy for such expenses to establish rules concerning the eligibility and reimbursement of these types of expenses incurred by staff for professional purposes.
We examined the policy that is in place, and found that it gave claimants and decision makers a great deal of discretion. For example, we found that hospitality expenses and staff responsibility for them are not sufficiently defined or structured. The policy also does not address the purchase of alcoholic beverages consumed with a meal, although such purchase is common practice. Furthermore, the current policy sets out the authorizations needed based on kilometres travelled, so that few prior authorizations are needed. This policy also does not take into consideration the destination, purpose, or total cost of travel to determine whether an expense should be authorized beforehand. A clear and complete policy would identify situations where travel and hospitality expenses are acceptable and reasonable, and cases where authorization is required.
Furthermore, for transparency, the Corporation should require designated senior managers to disclose their travel and hospitality expenses on the Corporation’s website, as required by other government organizations. At the very least, the Board should be notified of the travel and hospitality expenses of each member of senior management.
Recommendation. The Corporation should review its policy on travel and hospitality expenses to improve the authorization, processing, reimbursement, and disclosure of these types of expenses.
The Corporation has responded. Agreed. The Corporation will update, by 31 March 2014, its hospitality and travel policies in order to better specify eligible expenses and define the approval, disclosure, processing, and reimbursement of these costs.
There are deficiencies in the processing of travel and hospitality expenses and in the related documentation
The implementation of key controls in an organization is essential for the sound management of expenses. First, expenses must be authorized beforehand to ensure that funds are available and that they will be spent for reasonable purposes. Steps must then be taken to ensure that the expense incurred by the claimant was for the specified purpose and is in keeping with the applicable policies and rules. The person who verifies this information must ensure that the claim is submitted with all supporting documents before authorizing the expenses. Finally, no payment should be made before a duly completed claim form is submitted. We found that some of management’s travel and hospitality expenses were not reviewed properly because of weaknesses in the Corporation’s practices.
We found that often, information and supporting documents were insufficient to determine whether some travel and hospitality expense claims were reasonable and whether the expenses incurred by the claimants were job related. For example, the Corporation does not require claimants to submit all the expenses they incurred on a trip on a single expense claim. As a result, staff who must approve the expenses incurred do not always have all the necessary documents or a complete view of the trip to determine whether the expenses are reasonable. This means that some expenses could be reimbursed twice or inappropriate expenses could be authorized. Although large amounts are not involved, we found that a few travel expense claims had been reimbursed twice. As a result of our observations, the Corporation asked the claimants concerned to return the overpayments. Also, several expense claims were supported only by transaction slips or the claimant’s monthly credit card bill, which made it difficult to analyze the rationale for the reimbursement claimed.
Finally, we had to rely on subsequent explanations from management to determine whether certain travel and hospitality expenses were reasonable, because the Corporation was unable to provide us with complete documentation.
We also found other irregularities in travel and hospitality expense claims. The Corporation reimbursed a claimant for an overseas trip despite the fact that not all of the objectives of the trip identified beforehand were met. Given that not all of the expenses for this trip were incurred for the intended purposes, the value the Corporation received in exchange was debatable. The Corporation also covered approximately $3,500 in expenses so that certain Board members and their partners could attend a few events, namely a show, a meal, and a fundraising dinner for a public institution.
Recommendation. The Corporation should review its control and documentation procedures for the management of travel and hospitality expenses in order to ensure that expenses that claimants incurred are reasonable.
The Corporation has responded. Agreed. The Corporation will update, by 31 March 2014, its oversight procedures regarding hospitality and travel expenses.
Documentation of decisions and practices
Information is key to effective management in any organization. The Government of Canada adopted an information management policy that requires decisions and decision-making processes to be accompanied by all the necessary supporting documentation to ensure and support the organization’s operational continuity and to allow for changes to be made to policies and programs, and allow for independent audits and assessments. Although the Corporation is not subject to this policy, these good practices should be followed by all organizations in the federal public administration.
There is room for improvement in the documentation of some management practices and decisions
Several times during our examination we found documentation lacking. For example, we found that the Corporation did not have a complete and documented analysis of the risks it was exposed to (see the Strategic planning, risk management, performance measurement, and communication of results section). Although we have noted improvements over the years, we found shortcomings in certain staffing files. Also, the documentation in certain harassment case files was incomplete (see the Human resource management section). We also found gaps when we examined files related to the Corporation’s management of leases and concessions (see the Operations section). We recommended that documentation on project management be improved (see the Asset management section). Finally, we expressed our concerns about the fact that the Corporation often did not provide enough information and supporting documentation to determine whether certain travel and hospitality expense claims were reasonable (see the Travel and hospitality expenses section).
The Corporation’s systems and practices and management’s decisions should be based on complete, reliable, and accessible documentation rather than on staff knowledge. Better documentation would, among other things, reduce the risk of losing the Corporation’s corporate memory as a result of staff turnover, and would enhance the efficiency, transparency, and accountability of management. Furthermore, proper documentation would show that management has met its responsibilities with respect to the Corporation’s policies.
Recommendation. The Corporation should review its systems and practices to ensure that the decisions made and practices followed by management are based on all the necessary supporting documentation.
The Corporation has responded. Agreed. The Corporation will update its systems and practices by 31 March 2014 to ensure that decisions made by management are based on all the necessary supporting documentation.
About the Chapter
The objective of this chapter was to bring to the attention of Parliament the results of the Office of the Auditor General’s special examination reports transmitted to the boards of directors of Crown corporations since our 2012 Spring Report. The Crown corporations have to subsequently make these reports public.
Scope and approach
The chapter includes the main points of three special examinations where the Auditor General was the examiner, as well as the matters of concern included in the report transmitted to the Board of the Old Port of Montréal Inc.
The approach followed in this chapter involved presenting information from special examination reports, providing information about what a special examination is, and presenting the main points of the three special examinations as well as the matters of concern included in the report transmitted to the Board of the Old Port of Montréal Inc.
Assistant Auditor General: Sylvain Ricard
Principal: Marise Bédard
Director: Paul Kelly
For information, please contact Communications at 613-995-3708 or 1-888-761-5953 (toll-free).
Appropriation—An authority provided by an Act of Parliament to pay money out of the Consolidated Revenue Fund, up to a maximum amount, for a specified activity during a fiscal year. Payment in excess of that amount will reduce the appropriation provided for the subsequent fiscal year. (Return)
Significant deficiency—A major weakness in a Crown corporation’s key systems and practices that could prevent it from having reasonable assurance that its assets were safeguarded and controlled, its resources were managed economically and efficiently, or its operations were carried out effectively. (Return)