Audit Committee

AUDIT COMMITTEE MINUTES DATE: November 29, 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 3:12pm. II. ANNOUNCE MEMBERS IN ATTENDANCE (VERIFY QUORUM) Audit Committee members present: Wilbur Berry, Jeff Henley, Joyce Norris, Lynn Stokes and Jerry Weatherspoon Audit Committee members absent: None Quorum verified? Yes Internal Audit attendees: Rodney Wright, Cassie Wheeler Other Attendees: None III. ADOPTION OF MINUTES: July 26, 2017 Audit Committee Meeting Joyce asked the Audit Committee members to review the minutes and called for a motion for approval. Lynn made a motion to accept the minutes, Jeff seconded. The minutes were approved as presented. IV. DEPARTMENT REPORT A. Budget Report Rod reviewed the YTD budget report. Personnel costs are below budget because Stephanie is on maternity leave until January. The department has paid two Crosslin invoices so far from line 4334. Since most memberships & dues are paid later in the fiscal year and there are conferences are in the spring, lines 4321 & 4322 will be used later in the fiscal year. 4325 Software Renewals is for the ACL software, but the department is considering not renewing since Excel meets the needs of the department. Lynn asked about 4442 Rental of Equipment & Vehicles which is the filtered water dispenser in the breakroom. Cassie explained it is at 88.2% because they made a PO for the entire year and $43.75 is encumbered. B. Update on Internal Audit Activity Cassie’s main focus has been working on the fleet policy audit. She finalized the field work and now it is in the review & draft stages. Rod explained it is a complicated report since it is City wide and there are various issues that apply to some departments but not to others. Sole source audit was put on hold, but Rod will be working on that. We will kick off the Payroll Audit and Cassie will be leading it. Stephanie will work on Senior Management Expense Audit when she returns. Rod will be requesting the I-9/E-  verify be postponed until FY19 due to recent procedure changes in HR. We recently issued the Building & Codes Permit Follow Up, and will issue Follow Ups on Parking, Pcards and Streets soon. Rod has more work to do on the Gas & Water Follow Up, but the goal is to get all of them issued by the New Year. We’ve had one legitimate hotline report since the last meeting and two which were matters for the Police Department. C. Metrics Discussion Rod explained that the approved utilization rate was 80% for auditors and 40% for the director. The utilization rate is for time spent directly on audits and follow ups. Stephanie was at 76% before she left for maternity leave, Cassie is at 57%, and Rod was at 42%. Rod said 80% might be too aggressive and 70% might be more realistic for auditors next FY. Most of the other data won’t be known until the end of the fiscal year. V. COMMITTEE ACTION REQUIRED A. Approve Annual Plan Adjustment Rod requested the committee approve a change in the Annual Audit plan. He requested moving the I-9/E-Verify audit to FY19. VI. CITY COUNCIL ACTION REQUIRED A. None VII. NEW BUSINESS A. Approve remaining audit plan for FY18 This item was completed under Committee Action section. B. Ethics Commission Referrals Rod discussed wanting to possibly change the City Code to allow for a means to refer ethics complaints for the Ethics Commission to investigate and determine if a violation has occurred. Currently, a complainant must present the ethics violation under oath to the Ethics Commission. Wilbur agreed that the current code language is restrictive, but he does not think the Audit Committee should be involved in referring possible violations to the Ethics Commission. His concern is that the Audit Committee could decide to send some complaints, but not all of the complaints and this could give the appearance of the Audit Committee is not independent. Rod said the gap is the Ethics Commission is not able to hear ethics complaints currently, which is why he started this discussion. There are ethical issues that need to be reviewed, and they are currently not being reviewed by the Ethics Commission. Wilbur proposed sending any hotline complaints regarding an elected official to the Ethics Commission and the complainant would remain anonymous. The Ethics Commission would decide if they wanted Internal Audit to investigate. Rod said he would continue discussion on this topic with the City Attorney. C. Audit Committee Member Renewal Both Joyce Norris and Jerry Weatherspoon agreed to serve an additional term on the Audit Committee. D. Crosslin Peer Review Letter Rod presented the Crosslin Peer Review Letter to the Audit Committee. VIII. ADJOURNMENT OF PUBLIC MEETING Wilbur made a motion to adjourn regular session and enter executive session. Jeff seconded. Public meeting adjourned at 3:55pm.