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HomeMy WebLinkAbout2011-02-25 MinutesMinutes of the February 25, 2011 Audit Committee Meeting The following audit committee members were present: Tony Uth, Jr. Judy Jacobs Adam Motherwell Alderwoman Adella Gray The following City staff members were present: Don Marr, Chief of Staff Paul Becker, Finance and Internal Services Director Vicki Deaton, Internal Auditor Marsha Hertweck, Accounting Director Karen Minkel, Internal Consultant The following BKD (external auditor) staff members were present: Andrew Richards, Senior Manager David Coleman, Manager Approval of Minutes: The minutes of the December 8, 2010 Audit Committee Meeting were approved by all audit committee members. Draft minutes from this meeting and the December 8, 2010 final minutes will be forwarded to the City Council to keep them informed of committee proceedings. Internal Audit Update: Karen Minkel, Internal Consultant for the City, was introduced. Karen will work with the Internal Auditor on the lean government project. The project will run for several years and will focus on process improvement. The first function to be reviewed will probably be utility billing. Update on implementation of the time and attendance software — The first test groups recording time in the software are now paid by the electronic record. They are no longer completing paper time records. More groups have been added to test the system. They will be trained and moved to live to be paid by the electronic record. All employees in the City Administration building are either live in the system or in the test group. There are 2 time clocks in the City Administration building. Time clocks are currently being installed in most of the other City buildings. Employees will be able to clock in and out by time clock, the computer, and some field employees will use the telephone. Internal Audit review of HR Classification self -audit — During 2010, HR performed a review of each City position's classification as an exempt or nonexempt position. The review is almost complete. The HR Director is performing a final review of the last few positions. Solid Waste Hauler Vendor Audits - The draft report is being held by the Utilities Director. He is going to add his recommendations for the future of the hauler agreements and present them to the City Council. There was some discussion about how the audit was performed and the monies recovered. 2010 Physical Inventory Counts — A memo was issued on 1/12/11. 2010 Report on Annual Petty Cash Review — A memo was issued to management on 1/14/11. Accounts Receivable Collections — A draft report is with the Chief of Staff and Mayor waiting to be signed. The review addresses solid waste division collections of accounts receivables from customers who are also employees of the City. Background research was performed to determine the solid waste services billed through Accounts Receivable as opposed to being billed through Utility Billing. Police Property Evidence Review — A review was performed of the inventory control procedures used for safeguarding Police Department property and evidence. Work is almost complete and the report is being written. Completion of Audit Schedules — The Finance Department is currently completing audit schedules for the 2010 financial audit. BKD will be on site for fieldwork during the month of April, 2011. Arkansas Division of Legislative Audit Requests - House Bill 1532, An Act to Authorize Electronic Traffic Tickets, and for Other Purposes, has been presented to the 88`" General Assembly of the State of Arkansas. This legislation will allow the use of electronic tickets in the Police Department. Legislative Audit is also performing a review of our court accounting procedures. They are hoping to complete their work in the next few weeks and grant the City of Fayetteville an exemption from certain state regulations which are outdated. Approval of 2011 Internal Audit Plan: The draft 2011 Internal Audit plan was reviewed by the audit committee, the Chief of Staff and the Finance Director. The plan was approved by vote of the audit committee. BKD presentation: David Coleman and Andy Richards of BKD introduced themselves. David Coleman is the current Manager of the City of Fayetteville audit. Andy is a Senior Manager and will also work on this year's audit. David talked to the committee about some pre -audit communication that they will receive from BKD. A BKD powerpoint presentation titled Public Sector Audit Committees was presented by Andy Richards. A copy of the City's Audit Committee Charter was passed out for the members to review and compare to the best practices outlined in the presentation. The presentation focused on: ❖ why public entities should have audit committees, ❖ who should be responsible for forming the audit committee, ❖ the structure of the audit committee, ❖ and the role of the audit committee. There was discussion primarily about the structure of the City's audit committee and the relationship of the committee to the City Council, external auditors, internal auditor, and City management. The audit committee would like to disseminate information about the positive effects of having an audit committee along with all the efforts of the City to promote accountability and transparency. David Coleman and Andy Richards were thanked for their attendance and presentation. The meeting was adjourned.