Québec’s municipal oversight agency has found irregularities in how expenses are incurred by municipal employees in Grenville-sur-la-Rouge, following an audit of the municipality’s financial practices.
The investigation by the Commission municipale du Québec (CMQ) began on April 1, 2022, under the Loi facilitant la divulgation des actes répréhensibles à l’égard des organismes publics (LFDAROP) – the law requiring the divulging of reprehensible actions involving public organizations.
According to the CMQ report it was determined “reprehensible acts” were committed in Grenville-sur-la-Rouge. The investigation found several expenses incurred by employees exceeded their authority to authorize expenses and make contracts. Preliminary checks revealed expenses exceeding the purchasing power of employees without prior resolution by council.
On certain occasions, expense vouchers for only 12 cents were issued for expenses. The CMQ asserts “it is obviously impossible that this is the real anticipated expense.”
“Although this practice appears to be temporary and to compensate for input errors in the system accountant, it does not appear to comply with the rules,” says the investigation report.
“Furthermore, it appears that an employee was issued a credit card, while the regulations do not delegate any authority to incur or authorize expenditures or to award contracts,” the report continues.
The investigation found through an examination of council meeting minutes, the municipality has had a practice of authorizing, after receipt of invoices, expenses of more than $10,000 incurred by the employees. In accordance with the LFDAROP, expenses of more than $10,000 must be authorized by council. The employee spending limit is $10,000 per month.
According to the CMQ report, the information it obtained raised several questions about the municipality’s supervision of its power to spend money and budgetary control with regard to the application of the delegation of responsibility to authorize expenditures and enter into contracts.
“In these circumstances, we considered that it would be appropriate for the Commission to carry out an audit,” the report says.
Municipality responds
In response to the CMQ report, Grenville-sur-la-Rouge issued a press release.
“The members of council wish to inform the population that they take great insight regarding the recommendations of this organization and wish to implement them as soon as possible in order to comply with all the rigorous requirements of the law,” the statement reads.
The statement from the municipality explains how in 2021, council adopted a regulation to ensure better control of finances. In 2022, the municipality hired a Certified Public Accountant (CPA) auditing firm to ensure the best possible control of municipal finances. The firm’s mandate has since expanded to include the production of a report on administrative and operational structure, which aims to eliminate the possibility of human error and non-compliant processes.
“I wish to inform you that all members of the council will continue to act in the best interests of their fellow citizens. We will continue to ensure the improvement of municipal services through close collaboration with the various available organizations,” Mayor Tom Arnold said in the press release.
“The municipal council wishes to equip itself with the best possible resources in order to be able to work within an optimal operational structure and guarantee increased efficiency in the management of public funds,” Pro-Mayor Manon Jutras also commented in the press release.
