Vernon officials insist financial procedures are in order despite a provincial audit.
B.C.’s auditor general for local government has released an audit on the city’s purchase of goods and services from 2010 to 2012.
“It’s a report on what happened three years ago and what ever was lacking, the city has closed the gaps,” said Coun. Bob Spiers.
“I have no concerns about the procurement process.”
The audit states that while the city has worked to improve the procurement process, eight of 25 transactions tested showed non-compliance with city policies. Among them were inappropriate expense approvals.
“One of the expenditures was for the purchase of an airplane ticket for the then-mayor to attend a provincial political party event. In our view, it is not appropriate for such a purchase to be made using a City of Vernon procurement card,” states the report.
“Staff told us this expense was reimbursed by a local company but the city did not provide us with evidence to support this assertion. In addition, the company that staff told us reimbursed this expense was one of the city’s vendors. While the city did only a small amount of business with this company during the period covered by the audit, such a reimbursement by a vendor could create real or perceived issues relating to conflict of interest.”
Another breach of policies, according to the AGLG, was a city department issuing a $35,000 purchase order to a vendor in 2011 without the purchasing services department being involved. There also wasn’t a written contract.
The AGLG found that council between 2010 and 2012 allowed staff to handle procurement.
“While it is council’s prerogative to delegate purchasing authority to staff and we do not suggest that council should be directly involved in procurement activities, we would have expected council, in addition to its existing oversight of the budgeting process, to exercise effective oversight over procurement activities by balancing the extensive authority it has delegated to the chief administrative officer with requirements for clear and comprehensive reporting to council,” states the report.
The AGLG has made a number of recommendations to the City of Vernon over procurement.
Current council was elected in 2011 and CAO Will Pearce took up his duties in June 2012.
“A lot of it (in the audit) is from two administrations ago,” said Mayor Akbal Mund.
“The city has changed its procurement process. You have to take it (audit) at face value and say, ‘What is it like today at the city?’”
The city says it has moved to a centralized purchasing environment, and implemented electronic purchase orders and document scanning of paid invoices and council monitors budget activities.
The auditor’s recommendations will be studied by council and staff.
“We will look at it and there’s always room for improvement. There’s nothing wrong with an outside auditor taking a look at what you do,” said Mund.
Then-mayor Rob Sawatzky volunteered the city to participate in the provincial government’s local government audit process in 2012.