AGENDA MEETING OF THE CITY OF CAPE CORAL AUDIT COMMITTEE

Transcription

1 1015 Cultural Park Blvd. Cape Coral, FL AGENDA MEETING OF THE CITY OF CAPE CORAL AUDIT COMMITTEE January 16, :00 PM Conf PW Green/Room A Meeting called to order A. Chair Wolfson 2. ROLL CALL A. Austin, Hiatt, Nelson, Stevens, and Wolfson 3. Public Input 4. APPROVAL OF MINUTES A. October 17, 2018 Meeting Minutes 5. BUSINESS A. Election of Chair and Vice Chair B. City Auditor Update Report - City Auditor Butola 6. Member Comments 7. Time and Place of Next Meeting A. The next meeting will be held on Wednesday, February 20, 2019, at 3:00 p.m. in Conference Room PW Green A200 Nicholas Annex 8. Motion to Adjourn In accordance with the Americans with Disabilities Act and Section of , Florida Statutes, persons with disabilities needing special accommodation to participate in this meeting should contact the Office of the City Clerk at least forty-eight (48) hours prior to the meeting. If hearing impaired, telephone the Florida Relay Service Numbers, (TDD) or (v) for assistance.

2 If a person decides to appeal any decision made by the Board/Commission/Committee with respect to any matter considered at such meeting or hearing, he will need a record of the proceedings, and for such purpose, he may need to ensure that a verbatim record of the proceedings is made, which record includes the testimony and evidence upon which the appeal is based.

3 Item Number: 4.A. Meeting Date: 1/16/2019 Item Type: Approval of Minutes AGENDA REQUEST FORM CITY OF CAPE CORAL TITLE: October 17, 2018 Meeting Minutes SUMMARY: ADDITIONAL INFORMATION: ATTACHMENTS: Description October 17, 2018 meeting minutes Type Backup Material

4 MINUTES OF THE MEETING OF THE CITY OF CAPE CORAL AUDIT COMMITTEE Wednesday, October 17, 2018 VOLUME II PAGE: 51 OCTOBER 17, 2018 CONFERENCE ROOM :00 P.M. The meeting was called to order at 3:00 p.m. by Chair Wolfson. ROLL CALL: Austin, Stevens, and Wolfson were present. Hiatt was excused. Nelson arrived at 3:02 p.m. ALSO PRESENT: Andrea Butola, City Auditor Pam Swinney, Assistant City Auditor Victoria Bateman, Financial Services Director Approval of Minutes: July 18, 2018 meeting The minutes from the Audit Committee meeting of July 18, 2018 were presented for approval. Vice Chair Stevens moved, seconded by Committee Member Austin, to approve the minutes as presented. Voice Poll: All ayes. Motion carried. BUSINESS No speakers Public Input 2019 Audit Committee Meeting Schedule Committee Member Nelson arrived at 3:02 p.m. Discussion held regarding the 2019 meeting dates. Vice Chair Stevens moved, seconded by Committee Member Austin, to approve the 2019 meeting schedule as presented. Voice Poll: All ayes. Motion carried. City Auditor Update Report City Auditor Butola went over the 9/19/18 through 10/16/18 Update of City Auditor s Office Activities dated October 16, 2018 which was ed to the Committee and was posted online. They included the following: Completed Internal Staff:

5 VOLUME II PAGE: 52 OCTOBER 17, 2018 Charter School Authority Best Practices Audit Discussion held regarding: Charter School Authority Best Practices Audit was there any improvement? Best Practices Presentation to Council at a COW meeting April 2017 External Auditors pointed out areas to watch such as Purchase Orders and money handling Lots of procedures in place, four manuals, internal funds operating guide, etc. Does the Charter School Governing Board vote on purchasing items? Former City Auditor issued a report in March 2017 External Auditors did follow up audit with their recommendations. What are the next steps? Communication to the Charter School Governing Board sent Have recommendations and management s response and their plan After implementation date, will select sample for review, especially areas that were lacking in the policies and procedures Most audit findings besides Purchase Orders were in cash and check handling Have Charter School Governing Board encourage the parents to allow their kids to use MySchoolBucks and not cash, a lot of the cash handling issues could go away Looked at controls MySchoolBucks and RecTrac put so many more controls in place, had issues School Superintendent agreed to extend hours of cashier, this would work for middle school and high school, but not the elementary school. Any training? Implementation date is March 31 st City has been providing training in procurement and money handling. Since MySchoolBucks has a minimal fee, parents don t want to use it; system should pay for it. In Progress External Auditors Clifton Larson Allen (CLA) External Financial Auditors (CAFR) FY 2018 CLA External Financial Auditors Charter School (CAFR) FY 2018 CLA External Financial Auditors Charter School Internal Funds FY 2018 CLA Pension Plan Audits (Police, Fire, and General) FY 2018 CLA Discussion held regarding: Foster and Foster commitment for mid-december for actuarial reports In Progress Internal Staff: Public Works Storm Water Operations Parks and Recreation Coral Oaks Golf Course Operations Hurricane Irma Payroll Review

6 VOLUME II PAGE: 53 OCTOBER 17, 2018 Follow up Review Public Works Contract Follow up Review Fuel Acquisition, Monitoring, Disbursement, and Usage Follow up Review Parts Acquisition, Monitoring, Disbursement, and Usage Follow up Timekeeping Follow up City Clerk Records Division Follow up Public Works Road Resurfacing Other: Senior Auditor phone interviews completed. In-person interviews for two candidates scheduled for week of October 22. Discussion held regarding the candidates that applied and their credentials. Other (continued): Completed all QARs as necessary for any audits or projects issued after the prior peer review to address verbal finding to conduct QA on a timelier basis. All audits and follows ups started as of October 1 are included in Auto Audit- the new electronic workpaper (EWP) software Revision and leaning of office and audit processes as they related to the EWP s is ongoing. Attended City Council meetings and City Manager s Director Staff meeting Continue to review and update CAO policies and procedures, report, and memo formats Continue ongoing monitoring of open audit recommendations on the SharePoint Action Register by auditors in charge of assigned audits ceased October 1. Any open recommendations will be tracked in Issue Track which is part of the new EWP software. 9/19 to 10/16 - staff paid leave and holiday time FY 2018 YTD Follow Up Action Register: Attachment A as of October 16, Implementation Status of Audit Report Recommendations Professional Development: Training Webinars and Seminars Focus for the Next Period: Select a candidate for Senior Auditor position. Focus on reviewing and updating audit policy and procedures to reflect new processes transitioning to EWP. Continue ongoing work on follow up for prior audits performed Continue work on audits and special projects in progress and assign FY 2019 audits per audit plan Continue tracking of the follow up actions

7 VOLUME II PAGE: 54 OCTOBER 17, 2018 FY18 Fourth Quarter Performance Score Card (year-end) City Auditor Butola City Auditor Butola went over the overview of the City Auditor s Office performance measurements for the Fourth Quarter of FY 2018 and the year period of October 1, 2017 through September 30, She discussed the following: Budget Management Time Management Audit staff Status of Audit Plan Projects Percentage of Audit Recommendations Accepted Audit Report Recommendations and Follow up Action items Member Comments Discussion held regarding: The that Jill Hiatt sent who was not present at the meeting: I realize we have a lot of improvement that needs to happen in the fiscal management area of the Charter Schools, but are we moving fast enough and in the right direction? I'd like to hear from Vicky on this. which was read into the record by the Recording Secretary. (A paper copy of this was distributed to the Committee.) Finance Director and her staff to work with Charter School staff on who does what job and identify responsibilities for their staff Waiting for report coming out in January 2019 Template will capture all the costs since July 1 st, what services the City has provided, what challenges were found, recommended improvements, and identify budget for those improvements Why is the City in the Charter School business? The main problem is who would own the buildings and debt on them. Finance Director met with the CFO of the Lee County School District about them possibly taking it over. There was no response. Ultimate responsibility for education should be the County. Charter School is a value element for the City. Next step City Manager will meet with the Lee County Superintendent. An RFP was done, only interested party was Charter School USA Comparison of what it costs the City, Lee County, private Charter School management company Research shows that it costs approximately $300 to $500 per student for Charter USA Charter School deferred maintenance on their buildings and fleet. Success rate of Charter Schools in general is poor. Pembroke Pines has a very successful Charter School system; creative in how they collect money; donations are high; community support.

8 VOLUME II PAGE: 55 OCTOBER 17, 2018 For profit Charter School management company is approximately $300 to $500 per student; what would our charge be? Total administrative cost is estimated at running $3M per year, 3152 students, $951 per student RFP is out currently for transportation; City may bid on it. Lots of catchup for facilities and fleet Bus route being redone. State money - approximately $7,000 per student PECO money just went up Once the policies are in place and they are updated on I.T. technology, etc., the administrative side will be less burdensome. $3M does not cover the teachers salaries, total budget around $30M High school attendance dropping? About 75 to 100 vacancies, kids leave, lack of sports programs, want more extracurricular Time and Place of Next Meeting City Auditor Butola and Committee Member Austin noted they would be out of town and not available for the November meeting. The next meeting scheduled for Wednesday, November 21, 2018, at 3:00 p.m. in Conference Room 2006 was canceled. Chair Wolfson stated he would consider whether or not to hold the December meeting in the first two weeks of November. Motion to Adjourn There being no further business, the meeting adjourned at 3:49 p.m. Submitted by, Barbara Kerr Recording Secretary

9 Item Number: 5.B. Meeting Date: 1/16/2019 Item Type: BUSINESS AGENDA REQUEST FORM CITY OF CAPE CORAL TITLE: City Auditor Update Report - City Auditor Butola SUMMARY: ADDITIONAL INFORMATION: ATTACHMENTS: Description City Auditor's Update Report Type Backup Material

10 FLORIDA CITY AUDITOR'S OFFICE TO: FROM: DATE: Mayor and Council Members Andrea R. Butala, City Audito,oAV January 15, 2019 SUBJECT: Update of City Auditor's Office Activities, 12/20/18-1/15/19 Complete - External Auditors Clifton Larson Allen (CLA): External Financial Auditors Charter School Internal Funds FY CLA - External Auditors: Status from CLA: Issued December 18, 2018 In Progress - External Auditors Clifton Larson Allen (CLA): External Financial Auditors (CAFR) FY CLA - External Auditors: Status from CLA: Fieldwork began January 7 on schedule. Roll forward of interim procedures is substantially complete. Progressing well on substantive procedures. Major grant determination for federal and state single audit is in process. Pension Plan Audits (Police, Fire, and General) FY CLA- External Auditors: Status from CLA: (Note: Per CLA no concerns for completion at this time for any of the pension audits.) o Police- Currently in testing phase. Anticipate completion of test work next week (week ending January 25) Do not anticipate any issue with completion prior to next board meeting scheduled February 26 o Fire and General -In preliminary phase. Audit test work to begin next week or the week after (January 21 or January 28). Do not anticipate any issue with having reports completed for Fire board meeting February 26 or General board meeting March 12. In Progress - Internal Staff: Public Works Storm Water Operations - Internal Staff: Planning substantially complete. Risk assessment complete. Parks and Recreation Coral Oaks Golf Course Operations - Internal Staff: Planning complete. Fieldwork begun. P O Box Nicholas Pkwy. Cape Coral, FL Phone Fax

11 City Auditor s Office Update January 15, 2019 Page 2 of 3 Public Works Citywide Fleet Vehicles - Internal Staff: Planning in progress. Objectives communicated to Public Works and Fleet. Risk assessment completed. Post Audit Review Public Works Road Resurfacing Contract Internal Staff: In progress. One Finance recommendation remains with an anticipated closure date of 12/31/2018. Currently no further action necessary on this item. This item will be monitored as appropriate. Post Audit Review Timekeeping Internal Staff: In progress. One recommendation remains open. The City Auditor approved revised anticipated completion date of 9/30/19 (Finance). Currently no further action necessary on this item. This item will be monitored as appropriate. Post Audit Review City Clerk Records Division Internal Staff: In progress. One recommendation remains open with anticipated completion dates 4/30/2019. Closed recommendation with 1/31/2019 anticipated completion date. Post Audit Review Public Works Road Resurfacing Internal Staff: In progress. Procurement has one recommendation open with anticipated completion date of 12/31/2018. Will complete follow up review by the end of January. Post Audit Review- Charter School- Best Practices Internal Staff: In progress. All nine recommendations are still open. One recommendation with 12/31/2018 will be tested by the end of January to determine if closure is appropriate. Three recommendations have 3/31/2019 anticipated completion dates and five have 6/30/2019 anticipated completion dates. The open recommendations will be monitored as appropriate. Non-audit Service Fuel Acquisition, Monitoring, Disbursement, and Usage Internal Staff: In progress. One recommendation remains open with a 3/31/19 anticipated completion date (Finance and Fleet). Closed IT recommendation with 12/31/18 completion date. Non-audit Service Parts Acquisition, Monitoring, Disbursement, and Usage Internal Staff: In progress. One recommendation remains open with a 3/31/19 anticipated completion date (Finance and Fleet). Closed IT recommendation with 12/31/18 completion date. Other The Internal Auditor posting closed on January 11, Currently reviewing candidates for telephone interviews. Revision and leaning of office and audit processes as they relate to the EWP s is ongoing. Attended City Council meetings and City Manager s Director Staff meeting.

12 City Auditor s Office Update January 15, 2019 Page 3 of 3 Continue to review and update CAO policies and procedures, report, and memo formats. Continue ongoing monitoring of open audit recommendations through EPW software. FY 2019 YTD Follow Up Action Register: See Attachment A as of January 15, 2019 Professional Development: Department staff attended the following training webinars and seminars during this period. Audit standards require all members of the audit staff to achieve continuing education credits each year. Training program Sponsor City Auditor Assistant City Auditor Assistant City Auditor Senior Auditor Admin Support Staff ICS 100, 200, 700, 800 FEMA 26 Total hours 26 Focus for the next period The City Auditor and staff: Internal staff will: o Focus on reviewing and updating audit policy and procedures to reflect new processes transitioning to EWP. o Continue ongoing work on follow up for prior audits performed. o Continue work on audits and special projects in progress and assign FY2019 audits per audit plan. o Identify candidates for interviews and schedule interview for Internal Auditor Position Continue tracking recommendations for post audit review. If you have any questions or comments regarding this memo or any other matter in which this office may be of assistance, please contact me at or by at AButola@CapeCoral.net. Attachment C: John Szerlag, City Manager Connie Barron, Interim Assistant City Auditor Dolores Menendez, City Attorney Kimberly Bruns, Interim City Clerk Audit Committee

13 City of Cape Coral City Auditor's Office Implementation Status of Audit Report Recommendations FY 2019 Attachment A Report Issue Date Original number of recommendations Audit Office has verified that recommendation has been implemented or closed. As of 1/15/2019 Recommendations pending implementation and/or Audit Office Verification Evaluation of Internal Controls Fuel Acquisition, Monitoring, Disbursement and Usage 9/23/ Evaluation of Internal Controls Parts Acquisition, Monitoring, Disbursement and Usage 9/23/ Timekeeping Audit 9/16/ Public Works - Road Resurfacing Contracts Audit 3/2/ Financial Audit - Municipal General Retirement Plan /30/ Financial Audit - City CAFR /30/ Financial Audit - Municipal General Retirement Plan /30/ City Clerk Records Division 4/17/ Prior Year Open Reports - Action Items Charter School Authority Best Practices 10/16/ FY Action Items Total Prepared by: A. Butola and Updated by: D. Fuhrmann