Compliance Assessment Summary Report: North West Company LP
For Funding Agreement No. 1516-HQ-000023 between North West Company LP and Crown-Indigenous Relations and Northern Affairs Canada.
November 11, 2019
Name: North West Company LP
Location: Winnipeg, Manitoba
Time period covered by audit: April 1, 2015 to March 31, 2017
Amount of CIRNAC funding claimed during the period: $69,405,851
Crown-Indigenous Relations and Northern Affairs Canada ("CIRNAC") selected North West LP (the "Recipient Head Office"), and two of its fully owned stores, specifically, the Nain and Little Grand Rapids stores ("Nain", "LGR", or the "Recipient Stores") all together (the "Recipient") for an independent assessment for the funding period April 1, 2015 to March 31, 2017. CIRNAC contracted Ernst & Young LP to provide an independent report examining certain aspects of the Recipient’s management of the funding received under the program. Specifically, the engagement was planned to:
- Perform an audit of the subsidy claimed for reimbursement as it relates to the type and nature of eligible cost requirements of the program;
- Review compliance with the program visibility requirements and transparency of the subsidy to consumers as it relates to the requirements of the agreement;
- Provide recommendations on the Recipient’s reporting and claiming systems and procedures which support compliance with the terms of the agreement;
- Provide recommendations on management’s processes related to supply chain practices; passing on the full value of the subsidy and related profit margin practices; and sales to ineligible clients.
Ernst & Young LLP, an independent firm, was commissioned to undertake the engagement which took place at the offices of the Recipient.
Based on the procedures performed by Ernst & Young LLP, the following recommendations were provided to the Recipient for consideration:
- Implement a process at the store level to ensure that a subsidy is not offered to an ineligible customer and/or establishment.
- That the Recipient retention practice be amended to align with the Funding Agreement, which under section 10 Record-keeping duties, stipulates that the Recipient must store financial and non-financial records, including all original supporting documentation, for 7 years.
The final report has been issued.
Thank you for your feedback