Town moving further with on “financial management and practices review” offer from ministry

 

Town Logo Small-webBy Ron Giofu

 

The next step has been taken in the provincial audit process of the town’s books as council has formally accepted the offer from the Ministry of Municipal Affairs and Housing (MMAH) to perform it.

The move makes it official that the town calls for a provincial officer to facilitate “a financial management and practices review” with the town putting $100,000 aside to cover costs of the review. Council had originally requested an audit in January.

Town council also authorized that the agreement with the MMAH secures “unfettered access” to town staff and municipal records with council also asking that individual council members also have “unfettered access” to the ministry.

As part of a separate motion, town council also passed a motion asking for the MMAH to hear council concerns and to also review other policies and bylaws should the MMAH deem them relevant.

CAO Mike Phipps stated he was happy to see council move as it did by asking for additional items in a separate motion rather than as part of the original motion to accept the offer. Phipps said he has expectations that the MMAH will find inconsistencies and unorthodox financial practices, similar to what he said administration has already found. He also believes a number of recommendations will come from the review, but added he does not expect heads to roll as a result.

The target date for completion, he added, is Sept. 12.

“I know they are trying to expedite matters,” he said. “They want to see everything. We have to make sure staff are available to them.”

Councillor Diane Pouget expressed her desire to see council interact with the province with Councillor John Sutton suggesting having each council member interviewed as part of the process could be a way to alleviate that concern.

The review will go back at least until 2009, with interim director of finance Wendy Dade noting that different accounting rules existed prior to that thus defining the review period. However, she noted the review could extend further back should the ministry deem it relevant.

“If they need to go back further, certainly we can accommodate them,” said Dade.

Director of recreation and culture Dean Collver, who acted as interim CAO while Phipps was vacationing, noted the MMAH offer included them “guiding the process.”

Sutton said the offer from the province was to go back five years but added he felt confident the third party firm that is to be retained by the province would come back to council should it wish to delve deeper into the town’s finances.

“They know what is going on and they know why they are being called in,” said Sutton. “I expect they’ll do their due diligence.”

Phipps, under a question from Councillor Bart DiPasquale, noted that unorthodox financial bookkeeping dates back as far as 2002. DiPasquale noted the cost could exceed the $100,000 figure depending how far the MMAH-appointed firm goes back but added he has heard from constituents stating the costs are worth it to find out what exactly happened.

“I think we need to get the train back on track,” said DiPasquale. “We don’t want people saying we were cheap with this. It’s very important. People that approach me say they don’t care about costs. They want to know what is going on.”

MMAH spokesperson May Nazar told the River Town Times last week that ministry staff from its London office met with town staff March 14 with the MMAH providing “the elements of the proposed review in writing” late last week. Those elements are what council approved Monday night.

“Municipalities in Ontario are required to have annual financial audits. Amherstburg has completed its audit,” Nazar stated. “The ministry is offering to facilitate a professional financial management and procedures review, which examines how council and staff manage finances. A professional financial management and procedures review would examine the town’s financial practices, including financial planning, how accounts are set up and used, the use of reserve funds, and how financial information is communicated to council.”

Nazar added: “A review could not happen overnight. Professional services would be procured in an open and transparent manner. The professional firm would then meet with town staff, review the town’s policies and procedures, and submit recommendations for proceeding in the future. The cost would be determined based on the scope of the review.”

 

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