11/08/2013 10:01 EST | Updated 01/23/2014 10:53 EST

Portland Hotel Society investigated over spending habits

A third-party accounting firm has been hired to review the books of a large and well-known Vancouver-based non-profit housing society, says the CEO of B.C. Housing.

In a memo obtained by CBC News, B.C. Housing CEO Shayne Ramsay said his organization appointed the accountants after it discovered irregularities in the Portland Hotel Society's spending practices.

Ramsay said the accounting firm will ensure public resources are being spent appropriately and the society has proper financial and operational controls in place. He also said the provincial government is prepared to take further actions if warranted to ensure the protection of public funds.

The Portland Hotel Society provides social housing and support for people with mental illnesses and chronic substance-abuse issues on the Downtown Eastside, and it also operates a supervised safe-injection site with Vancouver Coastal Health.

Funds spent on B.C. Housing protests

Mark Townsend, the society's executive director, admitted to CBC News there is room for improvement in the non-profit's bookkeeping.

"Purchase order forms, you know... not something we're not necessarily against it. We haven't used it in the past because we're not really a giant bureaucracy," he said.

But Townsend worries the reason for the review stems from conflict over philosophical differences between Portland Hotel Society and B.C. Housing.

"We're happy to work on those things and improve things as long as they're not matters of principle where obviously, if —  Just because you get paid by the government doesn't mean that you're not going to say 'Hey,' when you try to close a shelter or when you try and do this. We're going to speak. You don't buy us off by giving us an admin fee," he said.

Some of the money the society gets from B.C. Housing is spent on public education campaigns against B.C. Housing, such as protesting shelter closures or other service cuts. Townsend said that type of spending is, in his view, not something the society is willing to give up.

"B.C. Housing might not like the way we spend that money cause sometimes it means [to] take actions against them on issues that they might not like being brought to the public attention," he said.