Toronto Water Division – Review of Wastewater Treatment Program, Phase Two

The objective of this audit was to assess whether the City’s wastewater treatment program was being managed economically, efficiently and in compliance with City policies and legislative requirements.  Due to the scope of the work involved, this audit was divided into two phases.  In Phase One, reported to the September 24, 2007 meeting of Audit Committee, we reviewed controls over payroll processing, overtime and attendance management, as well as the use of technology in managing maintenance activities.  Phase Two, which is the focus of this report, includes a review of purchasing, contract management, payment processing and compliance with legislative requirements.

Our review identified supervisory and financial control weaknesses in processing payments, managing contracts and maintaining inventory. In addition, wastewater plants, in many circumstances, have not complied with City purchasing policies in spite of specific directives from the City Manager. The recommendations in this report will improve controls over purchasing, contract management and payment processing. The implementation of the recommendations will also help Toronto Water achieve cost savings through more competitive procurement.