Ottawa’s auditor general says it was “inappropriate” for the Manotick Business Improvement Area (MBIA) to provide a $2,400 gift card as a retirement gift to a staff member and expense flowers and salon/spa accessories to board members or their family members for compassionate reasons.
Auditor General Nathalie Gougeon is recommending the Manotick BIA establish an expenditure management policy to clearly define acceptable expenses and strengthen controls over petty cash spending following a review of expenditures.
Gougeon’s office launched the investigation after a report to the City’s Fraud and Waste Hotline about potential inappropriate expenses incurred by the Manotick BIA. The auditor general examined 23 purchases of goods and services based on the allegations raised to her office, according to the report.
“Fourteen of the expenses reviewed lacked sufficient evidence to conclude whether the expenses directly related to MBIA business activities,” the report says.
“Examples included restaurant receipts that did not indicate the purpose of the expense or the attendees, and some credit or debit card receipts that did not have detailed information. We also observed gifts of a personal nature without sufficient evidence to link back to MBIA business.
“Without appropriate supporting documentation, the OAG was unable to determine if the transactions were aligned with the spirit of the BIA Governance Bylaw or aligned with the MBIA’s mandate.”
Gougeon says that since the BIA does not have policies for appropriate expenses for gifts, she determined the $2,400 gift card for a retirement gift would “not be acceptable” under the city’s Employee Recognition Program Guidelines.
“Other examples included expenses for flowers and salon/spa accessories that were gifted to Board members or their family members for compassionate reasons,” the report says.
“While MBIA representatives indicated that these types of gifts are provided to support those within the community and their past contributions to the BIA, it is our professional opinion that such expenses are inappropriate and not aligned with the MBIA’s mandate.”
In her report for council, Gougeon says the audit “highlighted a need” for the BIA to strengthen controls over the approval and reimbursement of expenses and petty cash.
“Ultimately, the MBIA has not developed a policy that provides sufficient guidance on the acceptable types of expenses and expectations for oversight of expenditures.”
The Manotick BIA said it agrees with the auditor general’s four recommendations, and changes will be presented to the board in January for approval.
The Manotick Business Improvement Area is tasked with promoting the village of Manotick as a shopping, dining and historical destination, according to the city’s website. Businesses within a BIA boundary pay a levy along with their annual property taxes to support the BIA’s work.
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