Auditor General raises Housing Authority concerns

The Housing Authority has received a red mark from auditors for its payroll controls, two years after a former senior bureaucrat was arrested for fraudulent invoices.

The Office of the Auditor General gave a qualified opinion of the authority’s 2021 financial year accounts, which were tabled in state parliament last week.

While an unqualified audit is a clean bill of health, a qualified audit means an auditor has found issues in an entity’s systems or record keeping.

“I identified significant weaknesses in the payroll controls implemented by the Housing Authority,” auditor general Caroline Spencer said in the report.

“These weaknesses could result in salary errors such as overpayments or payments to individuals who are not entitled to receive payments.

“Consequently controls to prevent invalid and inaccurate payroll payments were inadequate.”

Department of Communities chief financial officer Michael Crevola told Business News that the Office of the Auditor General had found no evidence of material or unknown errors.

“The Housing Authority’s move to a new payroll system in the 2020-21 Financial year is the main driver for the OAG’s findings,” Mr Crevola said.

“The need to strengthen controls after the payroll transition was acknowledged within the Housing Authority prior to the OAG’s findings. 

“A dedicated Payroll Remediation project was implemented and significant improvements have already been instituted.”

The auditor general also found significant weaknesses in the payroll system and leave management at the Department of Communities, according to its annual report.

The Department of Communities is the merged agency which has included the Housing Authority since 2017.

But the auditor general said controls at Communities had been improved since a prior qualified audit opinion for the 2020 financial year.

Last week, former Housing Authority chief executive Paul Whyte was sentenced to 12 years prison after pleading guilty to 564 charges.

Mr Whyte stole more than $27 million while serving in leadership roles at the Department of Communities and Housing Authority. 

Mr Whyte used his influential roles in WA's public housing and communities departments to authorise payment of false invoices to shell companies which had bank accounts controlled by Mr Whyte and another person.