Toronto Community Housing improving financial oversight

TORONTO, Feb. 28 /CNW/ - Toronto Community Housing is putting in place stricter financial controls and more rigorous oversight of procurement and employee expenses to ensure taxpayer dollars are spent wisely and well.

Chief Executive Officer Keiko Nakamura confirmed that the company has already begun making improvements to its practices for employee expenses and procurement cited by the Auditor General, and will implement the report's recommendations. Actions currently under way or planned for 2011 include:

  • The company's internal audit team is examining each expense deemed inappropriate by the Auditor General so that the CEO can determine the need for further corrective actions or employee sanctions.

  • Staff are being disciplined, with actions ranging from warnings to recovery of funds to termination of those responsible for the most flagrant actions identified by the Auditor General.

  • The company is taking steps to recover funds from expenses claimed inappropriately.  Money that should be repaid will be repaid.

  • Stricter spending controls have been put in place: Employee expenses must be approved by an executive or director; purchase cards for individual employees have been cancelled; and spending on employee recognition and rewards is suspended.

  • In April, the company will launch a "Do What's Right" ethics hotline for employees, along with staff education on fraud prevention and ethics.

  • The company will soon hire a senior procurement manager who will be tasked with implementing improvements to the strategic procurement unit, whose work the Auditor General found ineffective.

  • The company is reviewing previous reports from the Auditor General as well as the Bellamy Report for best practices on procurement, and is meeting with the City of Toronto to discuss how it can save money by working together more closely.

  • The company is strengthening its processes for vendor listings, purchasing programs, accounts payable processes, and procurement exception/sole source reporting systems. It will also put in place new processes for expenses and procurement with its subsidiary companies.

In announcing management's response to the Auditor General's report, Ms. Nakamura cited a series of steps the company has taken to promote business excellence since she became CEO in February 2010. These include:

  • Conducting an external review of financial controls and procurement systems.

  • Creating an ethics and compliance unit reporting to the CEO's office.

  • Conducting internal audits of bank deposits, operating unit budgets, mileage claims, and purchase cards.

  • Reviewing the company's processes for commercial leasing, revenue booking, expense approvals, invoice payments, cheque requisitions and petty cash.

  • Putting in place a new executive team, including a new Chief Financial Officer, Chief Operating Officer, and Chief Development Officer, with a mandate to establish strict financial controls and rigorous oversight of employee expenses and procurement.

Toronto Community Housing has invited the Auditor General to return in 2012 to audit its 2011 expenses to evaluate the effectiveness of the changes it is making.

In the coming months, Toronto Community Housing will provide regular progress updates about its work to the Board of Directors, to ensure it is spending the public's money wisely and well. The Auditor General's report will be presented at a special meeting of the Board of Directors. The meeting is scheduled for March 3, 2011. The meeting is open to the public.

QUOTATIONS

"The board is angry and indignant at what the Auditor General has found, because we believe Toronto Community Housing is capable of so much more. We are confident, however, that the failures identified by the audit reflect the company's past operations, not the present or the future.

"It would be tragic if these findings, as appalling as they are, are used to undermine the importance of social housing or to attack Toronto Community Housing's mission. Social housing is an essential part of building a great city.  Toronto Community Housing is an essential part of the city we live in—and the city we want to be.

"The board hired the current CEO, Keiko Nakamura, because she has leadership ability and personal integrity to make the changes the company needs to make. She has the board's full confidence and support."

David Mitchell, Chair, Toronto Community Housing Board of Directors

"I am outraged that the poor judgment and unacceptable actions of a few employees have tarnished the reputation of the entire company. They have embarrassed our board, and let down tenants, the mayor and council, and the people of Toronto.

"As CEO, I have already made serious changes. The Auditor General has recommended additional improvements. I will drive those changes through every level of the organization.

"My expectations are crystal clear. Managers are accountable for how every dollar in their budget is spent. Employees must follow procedures, use good judgment, and spend the public's money with the same care they would take spending their own money. Failure to do so will have consequences, for them and the company."

Keiko Nakamura, CEO, Toronto Community Housing

ABOUT TORONTO COMMUNITY HOUSING

Toronto Community Housing is Canada's largest social housing provider and home to more than 164,000 tenants with low and moderate incomes—about six per cent of the City of Toronto's population. Toronto Community Housing employs 1,400 staff in a broad range of jobs, who deliver its mandate to provide affordable housing, connect tenants to services and opportunities, and work together to build healthy communities.

LEARN MORE

www.torontohousing.ca

What's already been done

  • A new executive team

  • Ethics and compliance unit

  • Stricter spending controls

  • Staff discipline

  • Determining the need for further corrective actions or sanctions

  • External review of financial controls and procurement systems

  • Internal audits and reviews

What's coming

  • "Do What's Right" ethics hotline

  • Senior procurement manager

  • Implement Auditor General and Bellamy Report best practices

  • Working closely with the city to save money

  • Revamped corporate processes and systems

  • Tighter controls in place with subsidiary companies

  • Regular progress updates to the Board of Directors and public

SOURCE Toronto Community Housing Corporation

For further information:

MEDIA CONTACTS

Jeffrey Ferrier, Media Relations, 416-981-4252, Jeffrey.ferrier@torontohousing.ca
Kyle Rooks, Media Relations, 416-981-4347, kyle.rooks@torontohousing.ca     

Profil de l'entreprise

Toronto Community Housing Corporation

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