By
Stanley Tromp, Vancouver Courier, 10
Aug. 2011
____________
Some Vancouver Coastal Health employees have used
purchasing cards in improper ways, leading to a possible loss of taxpayers'
funds.
That was the finding of a
2010 audit of VCH spending, obtained by the Courier through the Freedom of Information law. Yet
VCH spokesperson Gavin Wilson said last week that since the audit, the health
authority tightened P-Card controls to prevent future losses.
VCH spent $280 million for
goods and services in 2009 and 2010. The authority has a purchasing card
program created to give employees a quick, easy way of paying for low cost
items. In 2009 there were 239 cardholders who spent $1.44 million through
50,085 transactions.
Wilson told the Courier that although VCH does
not have a breakdown on who is issued the P-Cards, they are generally
non-unionized management staff.
"Fraud is something VCH
takes extremely seriously," he added. "While we are pleased to say
this situation shows that the audit process is working, we are not pleased to
know that it found evidence of fraudulent activty by
two former employees."
The audit found that they did
not always comply with VCH policies, and "some instances of potential
fraud were even noted."
Most transactions did not
contain an explanation for their business purpose, 278 transactions did not
have the original receipts attached, 17 P-Cards were issued to staff who did
not have spending authority, and some cards were improperly shared.
"Cardholders have used
P-Cards for questionable purposes," such as for 17 liquor purchases and 32
parking tickets. To reduce this problem, auditors advised the VCH to contact
Scotiabank (its P-Card provider) to "block purchases from certain
merchants."
In some other cases, VCH paid
twice for the same transactions, as when employees claimed reimbursement on
expense claims for charges paid for by P-Cards. "An
decrease to VCH's reputation is at risk as this can be viewed as inadequate
monitoring over the use of public funds."
A "high priority"
problem noted was that cardholders did not have to undergo training for P-Card
usage, the audit said. "Management should immediately improve the internal
controls relating to the monitoring of P-Card purchases."
Wilson said that VCH amended
its P-Card policy so that cardholders must explain the business purpose of
their transactions, and those who don't follow the policy will have their
P-cards suspended. Cardholders now have to pick up their card in person and
receive an orientation session with the P-Card administrator.
The VCH accounting branch now
sends out regular notices on what kinds of purchases are disallowed, and the
branch reviews the monthly statements for disallowed expenditures. VCH has
blocked charges to parking fines, towing charges, and drinking establishments
as "non-allowable."
A separate 2010 audit noted
that VCH spends millions of dollars yearly on computer software licence and maintenance fees. Yet it was hard to monitor
software fees without a record of price increases, the report said, and VCH may
be paying too much in annual maintenance.
As well, "some contracts
were difficult to locate or not available." Wilson said these issues have
been resolved. The authority created a central repository of contracts, which
tracks the services provided, vendor, contract dates, and more.
_____________________