I think that's how it used to be back in the day. Nowadays, you submit the complete application package to CIO in Sydney, NS. If it's complete(i.e. all documents in the checklist included), they forward it to the visa office you chose to process your application. A visa officer in that office then reviews the application thoroughly to determine whether you meet eligibility for the program e.g. if you applied under CEC - graduate stream, they want to see transcripts, copy of degree/diploma from Canadian institution, original IELTS results, reference letter from employer with all the information required, no gaps in your personal history form, T4s, NOAs, etc. If this is complete and you meet eligibility, they send the AOR or AOR + medical request.
Processing of your application begins - they start running background and security checks which involves RCMP screening and CSIS; they verify information, contact employers, request fingerprints, request an interview or ask for clarification or more documents(if need be). Note that not every applicant goes through the same process and background checks can take up to 1 year for some people especially those who have lived in many countries or visited certain countries.
Note that you will never find out the results of your security checks because it is classified information.