What we examined (see Focus of the audit)

The International Development Research Centre is a federal Crown corporation established in 1970. It reports to Parliament through the Minister of International Development and La Francophonie, and is part of Canada’s foreign affairs and development efforts. Its enabling legislation, the International Development Research Centre Act, mandates the Centre “to initiate, encourage, support and conduct research into the problems of the developing regions of the world and into the means for applying and adapting scientific, technical and other knowledge to the economic and social advancement of those regions.”

Our objective for this audit was to determine whether the systems and practices we selected for examination at the International Development Research Centre were providing 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.

Based on our assessment of risks, we selected systems and practices in the following areas:

• corporate governance;
• strategic planning, risk management, and performance measurement and reporting;
• selection and management of research projects; and
• selection and monitoring of donor agreements.

What we concluded

In our opinion, based on the criteria established, with the exception of the significant deficiency we found in the Board complement, there were no significant deficiencies in the International Development Research Centre’s systems and practices that we examined for corporate management and the management of research projects and donor agreements. We concluded that the Centre has maintained these systems and practices during the period covered by the audit in a manner that provided the reasonable assurance required under section 131 of the Financial Administration Act.

Subsequent event

The corporate governance section of this report discusses the significant deficiency that we found in the complement of the International Development Research Centre's Board of Governors. In November 2015, the Board had only 8 governors, and the terms of 3 governors were going to expire in June 2016.

On 14 June 2016, the Minister of International Development and La Francophonie announced the appointment of a new chairperson and 6 new governors to the Board. This new Board complement of 12 members will help the Board to ensure and maintain a quorum and thus validly conduct business.

What we found

Corporate management practices

Overall, we found that except for the significant deficiency discussed below, the International Development Research Centre had in place good corporate management practices for governance, strategic planning and risk management, and performance measurement and reporting. The significant deficiency we found related to the ongoing delays in Board of Governor appointments over which the Centre did not have control. These delays threatened the Board’s ability to validly transact business, and thus put proper oversight and timely decision making at risk. We also found that the Centre needed to improve the integration of performance measurement at the project level with performance measurement at the corporate level.

These findings are important because corporate management practices work together to help ensure that the Centre can fulfill its mandate and meet all applicable requirements under federal legislation. Having enough Board members maintains continuity at the Centre and supports proper oversight and timely decision making. Integrating performance measurement at the project level with performance measurement at the corporate level enables the reporting of progress toward strategic objectives and targets.

• Except for a significant deficiency and one needed improvement, the Centre had in place good corporate management practices

  Recommendation. The International Development Research Centre should continue to engage with the Minister of International Development and La Francophonie on the need for sufficient and timely appointments to the Board of Governors, continue to provide the Minister with profiles of potential candidates, and reinforce the need for staggered terms of office.

  Recommendation. The International Development Research Centre should put in place a systematic approach to integrate its strategic direction, risk management, and performance measurement and reporting with its project planning and monitoring. It should ensure coordination and communication of these corporate-level activities throughout the Centre.

Management of research projects and donor agreements

Overall, we found that the International Development Research Centre had systems and practices in place for managing program implementation and delivery, as well as for managing the selection, approval, monitoring, and reporting of research projects and donor agreements. We noted a weakness in the risk assessments of parallel-funding private-sector partners conducted prior to entering into agreements.

Establishing appropriate program- and project-level performance indicators that align with the Centre’s strategic indicators is critical to ensuring the measurement of project results and the tracking of progress toward strategic objectives. It also supports the effective implementation of programming and research projects in developing countries.

Proper risk assessments of potential partners before entering into agreements is important to ensure that the Centre identifies, assesses, and mitigates, where possible, any risks related to associating with the partner, including reputation risks.

• Except for one needed improvement, the Centre had in place good management of research projects and donor agreements

  Recommendation. The International Development Research Centre should establish a systematic approach to assessing risks associated with parallel partnerships prior to entering into the agreement.

Entity Responses to Recommendations

International Development Research Centre agrees with our recommendations, and has responded (see List of Recommendations).

Related Information

Report of the	Auditor General of Canada
Type of product	Special Examination
Topics	Crown Corporations Financial Management and Government Spending
Audited entities	International Development Research Centre
Completion date	22 June 2016
Tabling date	19 July 2016
Related audits

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