IWK handing expense scandal info to police; auditor general 'gravely concerned'

Nova Scotia Auditor General Michael Pickup announced Tuesday his office will audit the IWK Health Centre's books and practices, and said the hospital is turning over to police information related to former CEO Tracy Kitch's expenses.

The announcement follows calls from the Halifax hospital's board for help in the wake of the expense scandal involving the former CEO.

In a news release, Pickup was blunt in his assessment of revelations about expense practices at the hospital, which have also led to CFO Stephen D'Arcy going on paid leave.

"I am gravely concerned with the ineffectiveness of financial controls and lack of rigour in financial management as publicly reported by the IWK in recent weeks," he said.

Pickup said the "weaknesses" at the IWK were of a "serious nature" and his office will conduct financial and performance audits. For instance, it will look at control practices from the beginning of a transaction to the final recording.

"There will be no limitations once we get in there and the IWK fully appreciates and respects that," Pickup said in an interview.

The hospital has also agreed to turn over any information it has related to Kitch's expenses to police. Pickup said that decision was made because those who work in his office are not policing officials and do not answer questions about whether something is criminal.

"For the good of people who are concerned about this, really it's up to the policing authorities to make those types of decisions," he said.

Health minister supports AG involvement

If Pickup uncovers any other relevant information, it too will be sent to police, he said.

He said he would also become the hospital's annual financial statement auditor, beginning on April 1, 2018.

Health Minister Randy Delorey said Tuesday that despite the financial controversy, he is confident high-quality health care continues at the IWK.

He said the board "assured me in no uncertain terms that the frontline health-care providers are doing their job, day in and day out. They will continue to do that … and they have throughout that whole process. So there's absolutely no concern in that regard."

He said he supports the board's decision to call in the auditor general, but did not ask them to take that step.

"I haven't had the need to do so. The board … has kept me up to date."

Reporting highlights problems

CBC News first reported in June about inconsistencies with Kitch's expenses. A CBC News investigation found thousands of dollars of personal expenses were charged to a corporate credit card in Kitch's name.

CBC News reported on Monday evidence that showed Kitch and D'Arcy worked to downplay her expenses and that some items were knowingly left off public expense reports. Documents also showed D'Arcy prevented emails about the preparation of those expenses from being publicly released.

Kitch resigned from her post in August, a week before the release of a report by auditing firm Grant Thornton that showed she expensed $47,000 in personal charges to the hospital in almost three years. To date, Kitch still owes the hospital almost $10,000.