City of Nanaimo auditor finds deficiencies in whistleblower policies

Employees who raised concerns were disciplined, says KPMG

The City of Nanaimo’s auditor is recommending that the municipality strengthen its whistleblower policies and review its expense reporting.

KPMG provided a 2017 audit findings report to the city on Monday to be formally presented at the finance committee meeting on Wednesday, May 9.

The auditor found that the city’s financial statements “present fairly, in all material respects, the consolidated financial position of the city,” but went on to identify other areas of concern.

The report found “significant deficiencies in internal control over financial reporting” and outlined problems in respectful workplace and serious misconduct reporting; expense report review, authorization and policies; consistency of hiring practices; and governance understanding and responsibilities.

In regards to whistleblower policies, KPMG found that employees “raised concerns regarding the appropriate usage of city funds and the ability to collect funds owed to the city,” and while their initial concerns were said to be handled effectively, when the issue was raised a second time, “disciplinary letters were placed in the complainants’ employee files.” According to the report, the respectful workplace policy was revised five times between January 2017 and January 2018 and “three of the revisions related to the individuals designated to manage complaints.”

story continues below

KPMG recommends city council review its respectful workplace and reporting serious misconduct policies, and suggests complaints against senior leadership should be reviewed by the mayor or a designate.

KPMG also found deficiencies in expense reporting, as the city’s chief administrative officer and chief financial officer reviewed and approved each other’s expenses.

“This cross approval process provides for the opportunity of collusion between the two parties and is not an appropriate internal control,” the report notes.

On hiring practices, the auditor’s report found that the city has a “well-established hiring protocol,” but found in some situations, “steps in the process have been bypassed at the senior management level, that advice from human resources was not followed, and that candidates have been hired into positions without having met all the usual screening requirements.”

KPMG noted that at the start of the audit process, there was discussion with the city about “significant risk of management override of controls” and that was one of the focus areas in the audit.

The audit findings report is accompanied by a staff report authored by Laura Mercer, deputy chief financial officer, and dated May 9.

Her report notes that “the city’s auditors, KPMG, have completed the audit work and are prepared to issue an unqualified opinion that the financial statements fairly represent the financial position of the city.”

Staff’s recommendation is that the finance and audit committee recommend council approve the City of Nanaimo’s 2017 annual financial statements.

RELATED: City investigating ‘allegation of significant concern’



editor@nanaimobulletin.com

Like us on Facebook and follow us on Twitter

Just Posted

Replacement value of RDN assets listed at $382M

Regional district completes first asset management review

Parksville powerlifter qualifies for world championships

Buhler sets personal bests in both raw and equipped lifting events

Wires left dangling after van crashes into hydro pole in Dashwood

Road closed while BC Hydro crews dealt with situation

Police go on hunt for distracted drivers in Parksville Qualicum Beach

One motorist ticketed for not wearing a seatbelt and using a cellphone while driving

Sparks fly as SUV speeds down wrong side of Highway 1 trying to flee RCMP

Captured on video, the vehicle headed westbound against oncoming traffic before crashing

Trudeau to campaign in Nanaimo on Monday

Prime minister to support Nanaimo-Ladysmith candidate Michelle Corfield

Bobrovsky perfect as Blue Jackets blank Canucks 5-0

Vancouver shut out for 10th time this season

Trudeau in Vancouver to support Tamara Taggart at Liberal nomination event

The former broadcaster is seeking the nomination for the Vancouver Kingsway riding

Fundraising campaign launched for man caught in SilverStar avalanche

In only two days, the GoFundMe surpassed its $15,000 goal

Terror at sea: Helicopter rescues frightened cruise passengers in Norway

The Viking Sky cruise ship was carrying 1,300 passengers and crew when it experienced engine trouble

Search and rescue team helicopters injured climber from B.C. provincial park

A 30-year-old woman suffered a suspected lower-limb fracture in Skaha Bluffs Provincial Park

DOJ: Trump campaign did not co-ordinate with Russia in 2016

Attorney General William Barr said special counsel “does not exonerate” Trump of obstructing justice

Trudeau calls May 6 byelection for B.C. riding of Nanaimo-Ladysmith

The riding opened up when Sheila Malcolmson resigned in January

Most Read