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TNRD forensic audit overlapping RCMP investigation

BDO Canada LLP continues to compile data as they conduct a forensic audit into Thompson Nicola Regional District. They updated the board on their progress at a meeting on July 15.
July 17, 2021 - 6:00 PM

As a forensic audit examining expenses at the Thompson Nicola Regional District nears two-thirds of completion, the accounting firm conducting the audit is overlapping a parallel RCMP investigation, the board heard in an update to the board this week.

BDO Canada LLP was contracted to carry out the investigation after concerns were raised over spending among staff and board members - specifically toward former Chief Administrative Officer Sukh Gill.

While the July 15 update was brief and spared details of any results BDO has uncovered, directors were told some of the details will be complicated by legal concerns.

"Obviously when we are in a sensitive matter and one that is under investigation both with forensic experts but also from a legal perspective, some of the specifics related to the investigation must remain confidential,"  Jervis Rodrigues, Partner and Senior Vice-President Financial Advisory Services, BDO Canada, said.

BDO did, however, provide insight into exactly what the process of a forensic audit involves and what may follow after their final report is delivered to the board.

A forensic audit involves using financial records and other documents, like email, to find clues that will lead to where fraud may have occurred, according to BDO Canada director of forensic disputes and investigations, Simon Padgett.

READ MORE: Okanagan, Thompson regional districts are on their own to control staff spending

"The nature of it is that the more we dig, the more we look at. The more we see, the more questions we have," Padgett said at the board meeting. "We're also defining possible further and future work. The more we look the more we find, we've got tangents going off in every direction. This is normal."

A year-long investigation by a Kamloops This Week reporter following Gill's mysterious departure revealed spending habits by Gill that amounted in roughly $500,000 of taxpayers funds used for discretionary dinners and gifts for staff. Following publication, the RCMP launched a fraud investigation and the regional district has begun reviewing its internal policies while contracting BDO to conduct an in-depth forensic audit.

The accounting company was contracted on May 4, 2021, and began their work the next day. The regional district set forth a five-year scope of the investigation, from the beginning of 2015 to the end of 2019, but investigators will expand that scope into more recent records if the evidence warrants it.

READ MORE: Former CAO was, by far, TNRD's highest paid staff member last year

They have drawn from general ledgers and financial statements from which BDO's software, called Relativity, will seek out anomalies that don't follow normal patterns or rules. They are also conducting interviews and investigating individuals' computers and emails.

The regional district supplied BDO with 785 expense reports over the five year scope, of which investigators have analyzed 350. Investigators have also identified roughly 12,000 emails that may be relevant to the investigation out of 40,000 that were handed over by the regional district.

Padgett also said that while not all of the documents have been analyzed, once they've analyzed roughly 50 to 60% of the files, there is a smaller likelihood of finding any new information.

However, they continue to conduct interviews and receive new documents from the regional district.

A final report of the forensic audit is to be openly published once it is reported to the regional district board.

The public can expect that report to be delivered at regional district board meeting in September as the investigation is expected to wrap up in mid-August.

READ MORE: The mysterious, outspoken Kamloops social media group run by a federal Conservative riding president


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