Audit of Capital Assets Management

This audit was included in the departmental 2012 Risk-Based Audit Plan as approved by the Deputy Minister, upon recommendation of the External Audit Advisory Committee. The purpose of the audit was to assess whether Environment Canada's capital assets are managed in such a way that supports effective and efficient delivery of the department's strategic outcomes and objectives over time.

The audit found good practices in the lifecycle management of centrally managed real property and the vehicle fleet; however, the governance framework for the management of other assets presents opportunities for improvement pertaining to roles and responsibilities.

The audit also concluded that while the operational performance of individual assets is generally good and decisions related to these assets are well informed, key information for departmental-wide decision making is inadequate in some areas and may pose a risk of sub-optimal capital investment decisions on the part of the department.

Furthermore, while some of these issues have been partially mitigated by various facets of the Integrated Investment Planning (IIP) process, improvement to the tool used to consolidate the investment demands would strengthen the process. In addition, the recent physical inventory count, and the partial implementation of an asset lifecycle management module, have helped the department progress further in specific areas.

To address the findings outlined in this report, we present the following three recommendations.

Recommendation 1:

Corporate Services Branch (CSB), in consultation with the branches that manage capital assets, should develop and implement a comprehensive framework, including policies, that formally defines the accountability for the lifecycle management of capital assets, including a better definition of roles and responsibilities for major lifecycle management functions.

Recommendation 2:

Corporate Services Branch (CSB), in consultation with the branches that manage capital assets, should better define the key information that is required to manage capital assets throughout their lifecycle, including the identification of key cost and performance information. Information systems should be enhanced to allow them to capture the required information and to produce the necessary key reports.

Recommendation 3:

Finance Branch (FB), in consultation with the branches involved in the Integrated Planning Process should improve the tools that support the IIP process to make it more efficient and incorporate additional information to ensure better informed investment decisions making.

Management Response

Management agrees with the recommendations. The detailed management response can be found under Section 3 of this report.