Summary of the Audit of the RCMP Revenue Collection Practices

On this page

• Context
• Audit objective
• Audit findings
• Key takeaways

Context

The Royal Canadian Mounted Police (RCMP) began providing contract policing services as early as 1906. The federal Minister of Public Safety is responsible for the RCMP and authorized to enter into agreements with other levels of government for the provision of RCMP policing services.

The 2012 Provincial/Territorial/Municipal Police Service Agreements are bilateral arrangements between the federal government and a provincial, territorial or municipal government for the use of the RCMP for a period of 20 years. The Minister of Public Safety is the signatory for the police service agreements.

The RCMP, as the service provider, is responsible for the financial management of police service agreement revenue collection. Revenues generated through the police service agreements are an important source of funds, representing more than 90% of RCMP revenue.

Audit objective

To provide assurance that the governance structure over the police service agreements enables the RCMP to adequately manage the collection of revenue in accordance with relevant policies, and identify potential opportunities for modernization. The audit assessed the accounts receivable collections process for contract policing revenues.

The scope period is from April 1, 2022, to March 31, 2023.

Audit findings

The audit findings for the collection of accounts receivable include three themes:

1. Effectiveness of revenue collection for the police service agreements invoiced in 2022-23
2. Monitoring of payments for retroactive pay for the first collective agreement for RCMP members
3. Processes in place to pursue collection of past due accounts since the police service agreements were signed in 2012

Key takeaways

Overall, the audit found that the governance structure over the police service agreements enables the RCMP to adequately manage the collection of revenue in accordance with relevant policies. The RCMP collected 99% of accounts receivable owed by contract partners for policing services revenue earned in 2022-23, with the majority of payments collected by the due date.

The first collective bargaining agreement for RCMP members was signed in 2021 and provided retroactive salary increases, which resulted in a significant accounts receivable for the RCMP. Due to the financial impact for contract partners, the signatory entered into agreements with partners to establish terms for installment payments to be collected by the RCMP by March 2025.

Although processes are in place to informally resolve past due accounts receivable, [REDACTED] Estimates for the allowance of bad debts were prepared annually, [REDACTED] Longstanding accounts receivable may increase the risk that the RCMP will not be able to collect payment.