AG Highlights Concerns in Management of Specialty Wines by NLLC

Auditor General, Julia Mullaley, delivered her report to the House of Assembly on the results of a performance audit of the Newfoundland and Labrador Liquor Corporation.

The audit concluded that the Corporation did not manage the procurement and sale of specialty wines in an effective manner and in compliance with legislation.

The report highlighted concerns around the lack of transparency in the acquisition of specialty wines for the Corporation’s Bordeaux Futures program during the fiscal years 2007 to 2018.

Decisions regarding these acquisitions rested solely with the former Chief Executive Officer (CEO), were not documented and did not follow the standard process for other product lines.

These wines were purchased throughout the period in quantities that far exceeded customer demand and resulted in significant excess inventory of specialty wine.

Further, instances were identified where the Corporation contravened federal and provincial legislation by knowingly selling and shipping, or arranging the shipping of, specialty wines directly to customers in other provinces.

Prices for most of these wines were discounted in an effort to reduce the excess level of specialty wine.