By PAM DOUGLAS
Special to Focus
An internal audit has harshly criticized the city’s management of the Rose Theatre, Brampton’s city-owned and operated live theatre venue, calling the facility’s management oversight “poor and ineffective”.
The routine audit was done in 2011 and found fault in everything from a lack of oversight by managers to cash handling by untrained employees and a frequent disregard for city procedures, policies and bylaws.
It also found more than three dozen recommendations made in a 2008 audit had not been implemented effectively by management at the theatre.
The 46-page auditor’s report will be at the Audit Committee table Wednesday morning for discussion.
The report reveals the Rose Theatre, which employs 155 full-time, part-time and contract employees and more than 200 volunteers, spent $2.5 million on “facility operations” such as maintenance, technical and staffing needs, while revenue from rental fees and ticket sales from the Rose Theatre Presents series totalled more than $3.8 million. Last year, the Rose held more than 100 free events that attracted more than 150,000 visitors.
However, among the findings, the report lists several examples of a lack of management oversight that “put finances and operations at risk” including:
• agreements were inconsistently negotiated and administered;
• no managerial approval of agreements of significant value;
• insufficient insurance practices were knowingly carried out, In October 2010 management was told by the city’s Investments, Risk Management and Service Planning Division that the $1 million in insurance required for facility rental agreements has to be changed to $2 million, but no change was made;
• inaccurate recording of expenses;
• a lack of analysis over trends of money shortages/overages of daily deposits;
• there’s no record kept of free tickets offered, received or declined. A recommendation was made that free tickets be recorded and a reason noted, “to reduce the risk of the misuse of complementary tickets”.
The audit covered a wide range of issues.
In it, the report notes the theatre’s $4 million worth of technical equipment is inconsistently listed and tracked, it is done manually, and no one takes inventory to ensure the assets are accounted for.
It also found that Rose Theatre staff changed documents created by legal staff to be used for facility rentals, artist agreements and sponsor and advertising agreements, and “multiple” agreements were signed by employees who were not authorized to sign them, contrary to city bylaws.
And despite a 2008 auditor’s warning that staff stop using their co-workers’ user identifications and passwords, the practice continued.
• sponsors are not all treated equally. Some received benefits significantly greater than those outlined in the sponsorship program, according to the report, while others didn’t;
• some artist agreements aren’t signed by the artists;
• “significant differences” were found between the sales report and the recorded revenue for ticket sales and in one case, revenue was still not transferred from the ticket sales account to revenue a full 22 months after the event was held;
• there is no master list of employees who have access to the safe;
• the safe combination hasn’t been changed in more than two years, even though there has been staff turnover;
The 2008 audit made 97 recommendations and management reported 94 of them were “fully implemented” while three were in progress, but in the most recent audit, it was found that only 56 were fully implemented, and 38 still required further action by management to be considered fully implemented.
Members of the audit committee are Regional Councillors Elaine Moore (chair), Paul Palleschi (vice-chair), John Sanderson and City Councillor Grant Gibson. All but Palleschi represent portions of the downtown core, where the theatre is located.
By PAM DOUGLAS