Audit Committee

AUDIT COMMITTEE MINUTES DATE: May 24, 2017 LOCATION: CITY HALL FOURTH FLOOR CONFERENCE ROOM TIME: 3:00 PM I. CALL TO ORDER – Audit Committee Chairman The meeting was called to order by Joyce Norris at 3:01 pm. II. ANNOUNCE MEMBERS IN ATTENDANCE (VERIFY QUORUM) Audit Committee members present: Joyce Norris, Lynn Stokes and Jerry Weatherspoon Wilbur Berry joined meeting in progress Audit Committee members absent Jeff Henley Quorum verified? Yes Internal Audit attendees: Rodney Wright, Stephanie Fox, Ginger Fussell Other Attendees: None III. ADOPTION OF MINUTES: March 22, 2017 Audit Committee Meeting Joyce asked the Audit Committee members to review the minutes and called for a motion for approval. Jerry made a motion to accept the minutes, Joyce seconded. The minutes were approved as presented. IV. DEPARTMENT REPORT A. Budget Report i. FY 2017 – Rod presented operational expenses to include an increase to line 4310 originally transferred to allow for anticipated peer review costs. However, Rod noted that subsequent receipt of travel expenses estimates appear to be within the original amount budgeted. Remaining employee training expense will include recent costs for Rod and Stephanie to attend the ALGA conference. Additional costs are anticipated in the accounting and auditing line for interim external audit fees for FY17. External auditors are scheduled for two weeks interim procedures beginning May 30th. Rod responded to Lynn’s inquiry regarding office needs. B. Update on Internal Audit Activity i. Peer review update – Rod thanked Ginger for assistance in preparing for peer review and shared that he met the Peer Review team leader at the recent ALGA conference. He reminded the committee that the on-site phase of peer review is scheduled for the week of June 5th. The team consists of an audit supervisor from Orange County, Florida and an IT auditor from Fairfax, Virginia. Ginger provided an update on the information provided to the peer review team so far as required by ALGA. She acknowledged Lynn’s work in preparing for the initial peer review  three years ago, facilitating an easier process this review period. (Wilbur joined the meeting at 3:12 pm) ii. Follow ups – Rod updated the committee on the status of the follow up project which is concluding. Three more were issued last week. The process is still going really well. A couple of groups did not provide feedback which will be taken into consideration in audit planning. There are a couple of follow ups that indicate items still open. Those reports will be issued with explanation that internal audit will continue to monitor. Stephanie added that there are five follow ups at various stages of completion with some test work still in progress. Also there are four for which reports won’t be issued; two senior management expense audits and two payroll. Senior management audits are recurring, therefore previous findings are reviewed during the next audit. There is an upcoming payroll audit planned. Lynn mentioned that she liked the follow up reports. Rod shared that the Mayor has given positive feedback about the follow up process also. iii. NASACT / ALGA Conferences - The NASACT Government Auditing Seminar was attended by Rod, Stephanie and Ginger. Lynn also attended as a private citizen at no expense to the City. Ginger presented some highlights to include state economic impacts, state internal control requirements, federal (Single Audit) internal control requirements, and upcoming pronouncements. Lynn asked how the City was positioned related to internal control requirements. Ginger noted that the City had worked really hard in the previous year to enhance internal control documentation. Rod added that the external auditors had shown positive interest in the risk assessment form being used by the City for departmental assessments. Rod and Stephanie attended the ALGA Conference the previous two days. Rod recapped sessions he attended to include topics such as common peer review issues, IT risks and controls, upcoming yellow book revision, and small audit shop roundtable discussions. Rod responded to Lynn’s inquiry regarding the number of red book vs yellow book shops, providing perspective from various shops. There was additional discussion about audit ideas gained from attending the conference. Stephanie shared additional session topics addressing investigations and hotline marketing, report writing and specific audit objectives. V. COMMITTEE ACTION REQUIRED A. Approve two audits for FY18 (Fleet Policy and Payroll) Rod requested that a Fleet Policy Audit and a Payroll Audit be added to the FY18 audit plan with hours to be determined at a later date. Lynn made a motion to approve. Wilbur seconded. The motion passed. VI. CITY COUNCIL ACTION REQUIRED A. None VII. NEW BUSINESS A. Approve two audits for FY18 (Fleet Policy and Payroll) (See Section V.A. above) VIII. ADJOURNMENT OF PUBLIC MEETING  Lynn made a motion to adjourn regular session and enter executive session. Jerry seconded. Public meeting adjourned at 3:40 pm. IX. PUBLIC COMMENTS (5 minutes each) X. NEXT MEETING - July 26, 2017 – 3:00 PM XI. EXECUTIVE SESSION – Vote by the Committee to go into executive session. At this point in the meeting everyone other than Audit Committee members and those asked to attend by the Audit Committee to address a pending audit issue will be asked to leave. Executive session began at 3:40 pm. A. Ongoing audits and investigations B. Hotline reports C. Audit plan XII. ADJOURNMENT OF EXECUTIVE SESSION Lynn made a motion to adjourn executive session. Wilbur seconded. Executive session adjourned at 3:55 pm.