A recent City of ABCity report indicated that there would be a record number of homeless over the next few years, so the city decided that it was important to make shelters available. Accordingly, contracts were signed with 2 hotels in the downtown area over a 3-year period. The hotels committed to have rooms available in the 2 coldest months of the year and the city agreed to pay for the rooms at a rate of $40 per night. The hotel rooms were intended for homeless families. At the same time, local churches got together and arranged to have volunteers staff the churches and provide hot meals so that the churches could be used as shelters by single individuals. The result was that the hotel rooms were not used, and over the period of three years, the city paid almost $850,000 for empty rooms. This was publicized in the local newspaper and the City Manager has asked you to provide her with a report for her reference. Of particular importance, she would like your recommendations on ensuring benchmarks and an alternative approach for use in future years.

Required:

As an Internal Auditor with ABCity and using a Case Solution Format (Problem Statement, Issues, Alternatives & Analysis of Alternatives, Recommendations & Conclusions), write a brief report to the City Manager (hint, you will want to take note of the text's reference to the "Effectiveness" aspect of an internal auditors' work)