Napanee will undergo procurement review due to ‘deviations’ from policy

The Town of Napanee will undergo a procurement review due to what the Town’s outgoing treasurer has called “deviations from the procurement bylaw policies and procedures.”

Nicole Davidson, Interim Treasurer, Financial Services, who has recently decided to leave the employ of the Town of Napanee, made a short but rather intense presentation to Council on Tuesday, Jul. 11, 2023.

Davidson’s written report noted, “Through 2023, a number of concerns have surfaced regarding inconsistent implementation of the Procurement By-law No. 2021-0046.” 

The Procurement By-law generally lays out the Corporation of the Town of Greater Napanee’s goals and objectives in relation to its procurement of goods, services, and construction.  It is meant to encourage accountable local government by describing the roles, responsibilities, and authorities of the Town’s employees, Chief Administrative Officer (CAO), and elected officials in carrying out the Town’s procurement operations.

Davidson’s report stated that the services of KPMG have been engaged to “review the Town’s overall approach to procurement, to identify potential areas of process vulnerability, and to provide recommendations for future improvements. In addition, an organization-wide training and process review is being undertaken, and forms and procedures to support the existing by-law framework are being standardized.” 

KPMG is a global network of professional firms providing audit, tax, and advisory services. According to its website, KPMG in Canada “helps ensure integrity and transparency through financial statement audits.” The procurement review work by KPMG is estimated to cost up to $100,000, according to Davidson’s report, and a public report on the results of the procurement review is anticipated in the fall of 2023. 

Though she did not get into specifics, the treasurer stated, “Mr. Mayor, in addition to the information in the staff report, the town is undertaking a procurement review which will review the past and current town procurements, as it has been determined that there have been deviations from the procurement bylaw policies and procedures.”

Without specifying what those “deviations” might be, Davidson stated, “It is my understanding that on January 13, 2022, which is prior to my time joining the Town [staff], there was internal training provided to staff by the previous treasurer and the director of operational audits regarding the updated procurement bylaw, which had been passed on September 28, 2021. Thanks to the power of online meetings, we have a listing of all in attendance, and the meeting lasted about an hour and 30 minutes.”

“From the training documents I have found, the goal of this session was to provide staff with a high-level overview of the procurement policy [and] review spending and signing authorities and different types of procurement methods based on spending levels and types,” Davidson explained. “This was to help ensure that all staff understood their roles and responsibilities.” 

“Earlier this year, I also recirculated that same procurement bylaw to all town staff and advised them that they had a responsibility to abide by the bylaw and the procedures within,” Davidson said. 

“The scope of this review begins [in] but is not limited to mid-2021, to cover the period of budget preparation for 2022 to the current day,” Davidson said, noting “KPMG will be reviewing procurement for goods, services, constructions, and credit card transactions to determine if there are any irregular procurements and/or risks or gaps in our current processes and procedures.”

Mayor Terry Richardson thanked the treasurer for her report and asked councillors if they had any questions or comments with respect to either the report or the presentation by Davidson. No councillors took the opportunity to speak.

Richardson said, “I think this is going to be a very important part of our term of Council right now,”  and he thanked Davidson for the report and information.

Council noted and received the report without any discussion.