Michael Joel-Hansen
Saskatoon StarPhoenix
An audit ordered by Indigenous Services Canada (ISC) raising questions about millions in spending by the Federation of Sovereign Indigenous Nations (FSIN) is now public.
KPMG conducted the audit, which analyzes spending from April 1, 2019 to March 31, 2024 and is posted on ISC’s website.
ISC said its purpose was to determine if funds being provided to FSIN were being used as intended. It indicated that FSIN executive was briefed about the findings on Sept. 11.
Among the spending called into question is more than $30 million provided to the federation during the COVID-19 pandemic. Auditors flagged around $23 million as “questionable” due to a lack of documentation.
“We were unable to assess how or if purchased personal protective equipment was distributed to the 74 Member First Nations of FSIN,” the report concluded.
It found $30,362.990 in questionable expenses where proper documentation to support expenses could not be found, $3,732.982 in ineligible expenses where documentation was found confirming expenses did not meet the criteria set out by ISC, and $155,595 in unsupported expenditures where auditors weren’t able to track down proper documentation or where it was found expenses were inappropriate.
KPMG said its auditors also looked at 62 transactions related to travel, totalling over $200,000.
Of those transactions, just over $3,000 in ineligible spending was found. These expenses were incurred by a vice chief who was on an unpaid leave of absence at the time. Another $47,894 in travel expenses may have also been in contravention of FSIN’s own travel policies.
Auditors couldn’t determine the purpose of some corporate travel expenses. The questionable expenditures, totalling $265,202, were flagged as possibly contravening FSIN policy. There were also indications of corporate travel invoices being paid twice, the report found.
Other specific expenses flagged include $246,524 made to a former employee, including severance which was deemed improper because the employee was rehired by FSIN a week later. The same employee was also paid $104,332 via contract through their private company to perform duties covered by their employment agreement.
Auditors are suggesting FSIN make a number of changes to deal with the issues outlined in the report. These include improving the federation’s documentation of purchases made on behalf of funding recipients, and making sure FSIN receives reports on funding use from recipients.
Other recommendations call for reviews of employee severance packages before payment, and that reasons for termination and rehiring be documented.
Auditors are also recommending that the organization works to ensure it doesn’t contract services from a company owned by a current employee.
James Smith Cree Nation Chief Kirby Constant spoke out this past summer calling for FSIN to be more transparent with its membership surrounding its spending of COVID-19 related funds.
The StarPhoenix reached out to the FSIN and ISC, but did not receive a response from either organization by Thursday’s publication deadline.
