Teachers group finances called ‘sloppy’
Missing documentation, questionable expense claims among discoveries
Saskatchewan’s largest teachers’ association is pledging to overhaul its accounting practices after an audit uncovered multiple issues, including missing documentation, questionable expense claims and executives kept in the dark about major expenditures.
While the auditors stopped short of identifying any wrongdoing — the report notes missing documentation made a complete analysis difficult — they found multiple issues, described as “concerns” and “potential irregularities.”
The Saskatchewan Teachers’ Federation (STF) hired KPMG Forensic Inc. to investigate the Saskatoon Teachers’ Association (STA), which represents the city’s 4,200 teachers, earlier this year after receiving complaints about potentially inappropriate transactions.
The audit concentrated on the STA’S 2017 and 2018 conventions, as well as expenses claimed by its president, John Mcgettigan.
While the auditor uncovered “some concerns around controls and procedures,” KPMG did not find any money was missing or any “unethical, unprofessional or illegal behaviour,” Mcgettigan said in response to written questions from the Saskatoon Starphoenix.
KPMG’S report has been closely held since it was completed in August. Those granted direct access had to either sign out copies or ink a non-disclosure agreement. However, The Starphoenix recently obtained a copy of the document.
The report includes a detailed analysis of the conventions, both of which went over budget without the STA executive committee’s knowledge, and Mcgettigan’s expenses, many of which the auditors found to be documented haphazardly.
It also contains 20 recommendations aimed at strengthening the STA’S accounting practices, including reviewing how travel expenses, refunded expenses and promotional items are handled, as well as ensuring records are kept and preserved.
In a lengthy written response approved by the STA executive committee, Mcgettigan said the association already operates in line with some of the recommendations, and has or is working on implementing most of the others.
Three recommendations — which concern accrual accounting and a server-based email system — are being taken “under advisement,” Mcgettigan said.
“I celebrate the fact that the report found no wrongdoing, unethical or unprofessional behaviour, and I am committed to improving the financial practices of our association,” he added.
In an interview this week, STF President Pat Maze said the audit — the first in his five years as president — was expected to cost $55,000, but ultimately cost upwards of $120,000 due to “roadblocks” related to missing documentation. He characterized the report’s findings as “sloppy accounting.”
While the STF gives its local associations as much autonomy as possible, it “takes very seriously” any issue related to its members’ dues to ensure they have confidence that money is spent appropriately and “controls” are in place, Maze said of the reason for the audit.
“Ultimately, we’re concerned about the reputational impact that this could have on teachers across the province. We want to make sure that members know that when they submit their dues, they are appropriately handled.”
The audit comes as the STF attempts to present a united front in its collective bargaining battle with the provincial government over wages and whether a mechanism for ensuring adequate classroom resources is included in its next contract.
The first section of the report concerns the two over budget conventions.
In response, the STA said the budgets appear larger than they are because the 2017 and 2018 conventions occurred during a single fiscal year.
The report’s second section details Mcgettigan’s expenses; some refunded expenses do not appear to have been properly documented while others were submitted at different times and to different STA expense accounts.
The report also states Mcgettigan was reimbursed $4,155 for a “social event” without providing an invoice to support the claim as a legitimate STA expense, and that there were other instances of expenses being claimed without invoices showing purchase details.
The auditors found “many expense and mileage claims where the purpose of the travel identified with the expense claim is vague or includes only the budget expense account to be used for recording the expense,” according to the report.
The STA said executive travel now requires a formal approval, and it’s incumbent on the president to report any refunds as the association is a non-profit and therefore cannot obtain a corporate credit card, necessitating the use of personal accounts.
“We have used a trust based system for decades with little or no issues,” the STA said, adding that it also plans to increase its parttime bookkeeper’s monthly hours of work as well as scan all receipts to ensure accurate records are kept. Missing or misplaced documentation is a persistent theme in the document, which notes that Mcgettigan’s STA email account had only a week of emails in its inbox and none in its sent folder. He also did not fulfil “a number” of requests for followup information, it states.
The STA described that finding as “confusing,” saying all relevant emails were on Mcgettigan’s computer and the issue did not come up during any of the interviews conducted as part of the audit process.
Asked what action should result from the KPMG report, Maze suggested implementing all of the report’s recommendations would be a positive step.
“The ball’s in (the STA’S) court,” said Maze, who acknowledged that relations between the STF and the STA have at times been “challenging.” A source familiar with both organizations characterized their relationship as one of long-standing tensions.
Asked what responsibility, if any, the STF should have for the STA’S accounting practices, Mcgettigan responded: “The STA Executive looks forward to working together with the STF in implementing KPMG’S recommendations.”