August 26, 1998

To:Audit Committee

From:Commissioner of Community and Neighbourhood Services

Subject:Response to the 1997 Management Letter Concerning The Homes for the Aged Division

Recommendation:

It is recommended that this report be received for information.

Background:

The City Auditor completed the 1997 audit of the Homes for the Aged Division and provided a Management Letter summarizing his findings and recommendations. These findings were discussed with the Homes for the Aged Division of Community and Neighbourhood Services Department. The response and action plan of the Homes for the Aged Division to the recommendations contained in the Management Letter is outlined in this report.

Comments and/or Discussion:

The Homes for the Aged Division acknowledges with appreciation the observations and recommendations provided in the Auditor's Management Letter. The areas of concern identified in the Management Letter and proposed remedial action are supportive of the Division's continuous quality improvement process.

Recommendation 1:

Management should consult with the vendor before the change of system base is finalized, to modify the Resident Financial Management System general ledger module to avoid duplication of input effort.

Management Response:

Discussions with the vendor are ongoing and any modifications that would improve administrative efficacy and effectiveness will be implemented.

Recommendation 2:

The Interest Trust Fund should only be used for purposes that would benefit residents.

Management Response:

The Division acknowledges and adheres to the policy that `the Interest Trust Fund is to be used for the general benefit of the residents of Toronto Homes for the Aged'. The Advisory Committee on Homes for the Aged monitors, on a transaction basis, the use of the Interest Trust Fund, and the Auditor reports annually on this fund to the Advisory Committee. The policy governing the use of this fund further provides that `no expenditure shall be made for the ordinary operation and maintenance of the Homes'. The adjustment made was a one-time correction that did not relate to home operations.

Recommendation 3:

The policy relating to proper use of the cards and consequences for unauthorized use of time cards should be clearly explained and distributed to all users. Supervisors should be aware of the possibility of misuse and monitor the use of the machines at unexpected times.

Management Response:

The Division formally communicates all policies and standards to staff. Internal controls are in place to ensure that policies and standards are properly implemented. All hours recorded as being worked in the timekeeping system are matched against a pre-authorized schedule which is input directly into the system. Any exceptions identified are carefully reviewed and approved. Due to the nature of the care and services provided by the Homes, any employee who was not on duty according to his/her work schedule would be readily identified by management. The Division will continue to review and evaluate all management controls in order to identify any opportunities for improvement.

Recommendation 4:

An exception report detailing access to the screen for adjustments including the author of the adjustment should be available for regular management review.

Management Response:

The TimeKeeper System is currently able to produce a variety of reports that are available to management on an ongoing basis. The Division is moving to the vendor's windows version and enhanced audit capabilities are expected.

Recommendation 5:

Authorization for services rendered and date of authorization should be contained in residents' files. Staff in each Home should be required to review all current client files to ensure this policy is in place and ensure missing authorizations are obtained.

Management Response:

The Division investigated each of the files identified by Audit and found that written confirmation of verbal authorizations had not been obtained as required by policy. All Homes will be required to conduct a comprehensive review of all current resident administrative files and practices to ensure that all necessary authorizations are on file in accordance with Divisional policy. In addition, the Division will inspect residents' records during the course of its regular operational reviews of the Homes' operations. Consideration will be given to the implementation of any other control mechanisms as deemed necessary to ensure ongoing compliance with this policy.

Recommendation 6:

The Nursing Report and Unit Census should capture completely the movement of residents assigned to a home.

Management Response:

The Division agrees that this daily record of resident movements needs to be produced with complete and accurate information. Controls are in place within the Division to ensure that correct resident statistical information is processed.

Recommendation 7:

All calculations of daily rates should be checked by the Administrator or Assistant prior to authorization.

Management Response:

The Division acknowledges that a recording error occurred. The procedures established by the Division require the verification by the Administrator/Assistant Administrator of the resident's calculated rate prior to a client executing an Admission Agreement contract.

Conclusion:

The Homes for the Aged Division appreciates the observations and recommendations made annually by the Audit Department in the interest of improving the Division's operations. The Division acknowledges the findings of the 1997 audit, and has taken or is in the process of taking the appropriate action in response to the recommendations made.

Contact Name:

Reg Paul, Director, Financial & Administrative Services

Tel: 392-8896; Fax: 392-4180; E-mail: reg_paul@city.toronto.on.ca

General Manager, Homes for the Aged Division

Commissioner of Community and Neighbourhood Services