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HomeMy WebLinkAboutResolution 3417-10-2006A Resolution NO 341710-2006 DESIGNATING THE AUDIT AND FINANCE ADVISORY COMMITTEE, APPROVING INITIAL MEMBERS OF THE COMMITTEE, AND APPROVING THE INITIAL CHAIR AND VICE CHAIR OF THE COMMITTEE WHEREAS, pursuant to M&C C 21269 approved by the Crty Council on January 24 2006, the City retained MAXIMUS Inc. to complete an operations review of the City's Finance Department and to make recommendations for improvement of the efficiency and effectiveness of the Finance Department and financial management within the City as a whole (the "Maximus Study") and WHEREAS, the findings and recommendations set forth in the Maximus Study were presented to the Crty Council on August 22, 2006 and I WHEREAS, one of the key recommendations mthe Maximus Study was that the Crty Council create a committee to oversee critical financial matters within the City and to provide direct advice to the City Council and the Crty Manager with respect to such matters, and WHEREAS, m response to such recommendation the Crty Council wishes to designate the Audit and Finance Advisory Committee and to approve the appointment of initial members, a Chair and a Vice Chair of such Committee; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH, TEXAS 1 That the Crty Council hereby designates the Audit and Finance Advisory Committee (the "Committee") to provide oversight for financial reporting, internal controls and auditing activities and to provide advice to the Crty Council and the Crty Manager with respect to such matters. 2. That the specific duties of and procedures for the Committee shall be set forth in bylaws governing the Committee, which bylaws shall be adopted by Resolution of the Crty Council as soon as practicable following the inaugural meeting of the Committee. 3. That the Crty Council hereby approves the appointment of the following individuals to serve as members of the Committee for terms expiring September 30 2007 ~1~ Resolution No 3417 10-2006 Mike Moncrief Jungus Jordan Wendy Davis Kathleen Hicks Garland P Asher 4 That additional citizens of the City may subsequently be appointed to serve as members of the Committee, which appointments shall be approved by Resolution adopted by the City Council. 5. That the City Council hereby approves the appointment of Jungus Jordan to serve as Chair of the Committee and Wendy Davis to serve as Vice Chair of the Committee, both for terms expiring September 30 2007 AND IT IS SO RESOLVED Adopted this 3`a A, day of October .2006 ~ ~ q, ~~~ s ~~^ !~ ~ , !,. CITY CQUI~C IL 0 C t D 3 2006 ,~"~ City Secretary of the City of Fort Worth, Texas City of Fort Worth, Texas Mayor and Council Communication COUNCIL ACTION Approved on 10/3/2006 Resolution No 3417 10-2006 DATE Tuesday October 03 2006 LOG NAME 02AUDIT SUBJECT Adopt Resolution Designating and Appointing Approving Initial Members of the Committee and Committee REFERENCE NO G-15432 the Audit and Finance Advisory Committee Approving the Initial Chair and Vice Chair of the RECOMMENDATION It is recommended that the City Council adopt the attached Resolution designating the Audit and Finance Advisory Committee approving the initial members of the Committee and approving the initial Chair and Vice Chair of the Committee DISCUSSION Pursuant to M&C C-21269 approved by the City Council on January 24 2006 the City retained MAXIMUS Inc to complete an operations review of the City's Finance Department and to make recommendations for improvement of the efficiency and effectiveness of the Finance Department and financial management within the City as a whole (the Maximus Study) On August 22 2006 City staff presented the Maximus Study's findings and recommendations to the City Council One of the key recommendations set forth in the Maximus Study was that the City Council create a committee to oversee critical financial matters within the City and to provide direct advice to the City Council and the City Manager with respect to such matters. In response to this recommendation City staff recommends that the City Council adopt the attached Resolution designating the Audit and Finance Advisory Committee (the Committee) and appointing the initial members of the Committee The purpose of the Committee will be to provide oversight for financial reporting internal controls and auditing activities and to provide advice to the City Council and the City Manager with respect to such matters. The specific duties and responsibilities of the Committee as well as procedures for the Committee to follow will be set forth in a set of bylaws governing the Committee These bylaws will be subject to approval by the City Council A draft of proposed bylaws has been provided to the City Council The final bylaws will be brought to the City Council for consideration once the Committee has met and provided its input. FISCAL INFORMATION/CERTIFICATION The Finance Director certifies that this action will have no material effect on City funds Logname 02AUDIT Page 1 of 2 TO Fund/AccountlCenters FROM Fund/Account/Centers Submitted for City Manager's Office b~ Originating Department Head. Additional Information Contact: Marc Ott (8476) Marc Ott (8476) Karen Montgomery (6222) Logname 02AUDIT Page 2 of 2 BYLAWS OF THE AUDIT AND FINANCE ADVISORY COMMITTEE ARTICLE I PURPOSE Pursuant to Resolution No 3417 10-2006, the City Council has created the Audit and Finance Advisory Committee (the "Committee") to provide oversight for financial reporting, internal controls and auditing activities and to provide direct advice to the Crty Council and the City Manager with respect to such matters. The initial duties and responsibilities of the Committee are attached hereto as Appendix 1 and may be revised at any time by majority vote of the City Council. ARTICLE II MEMBERS, MEETINGS Section 1 Appointments Initial Members The Committee shall initially consist of five (5) persons who shall be appointed by the Mayor subject to the approval of the City Council by Resolution (each a `Member") Members of the Committee may also be members of the Crty Council. The initial Members of the Committee shall be as follows Place 1 Mike Moncrief Place 2 Jungus Jordan Place 3 Wendy Davis Place 4 Kathleen Hicks Place 5 Garland P Asher Additional Members may subsequently be appointed to the Committee by the Mayor subject to the approval of the City Council by Resolution. All Members of the Committee must be at least eighteen (18) years of age and reside within the corporate limits of the City of Fort Worth. Section 2. Terms. The initial Members of the Committee shall serve for a term commencing on the date on which the Committee was designated and expiring on September 30 2007 Subsequent Members shall serve for a term of one (1) year from October 1 to the following September 30 Each Member shall serve until his or her successor is appointed. Each Member including the initial Members, shall be eligible for reappointment and shall not be subject to term hmrts. Any Member may be removed from the Committee at any time, with or without cause, by the City Council. Section 3 Meetings. The Crty Manager shall call meetings of the Committee and Bylaws of the Audit and Finance Committee shall set the agenda for those meetings. The Committee shall conduct meetings at a location within City Hall or such other place or places within the City as the City Manager may from time to time determine. The Committee shall conduct all meetings and file notice of each meeting in accordance with those requirements of the City under Chapter 551 of the Texas Government Code If the Committee does not hold a meeting during any period commencing October 1 of a given year and September 30 of the following year the Committee shall automatically sunset. Section 4 Quorum, Voting. A simple majority of the Members shall constitute a quorum of the Committee for the consideration of matters pertaining to the Committee If at any meeting of the Committee there is less than a quorum present, a majority of those present may adjourn the meeting from trine to time. The act of a majority of the Members appointed to serve on the Committee, and not just those present and voting at a given meeting, shall constitute the act of the Committee A Member who is present at a meeting of the Committee at which any action is taken shall be presumed to have assented to such action, unless the Member voices his or her dissent and such dissent is entered m the minutes of the meeting. Section 5 Conduct of Business At all meetings of the Board, the Chair shall preside, and in the absence of the Chair the Vice Chair shall preside. In the absence of the Chair and the Vice Chair an acting presiding officer shall be chosen by the Committee from among the Members present. The City Manager shall appoint an employee of the City to act as secretary of all meetings of the Committee The secretary shall not be a Member or officer of the Committee Minutes of each meeting shall be prepared and kept on file by the secretary Meetings shall be conducted m accordance with Robert's Rules of Order, Newly Revised, 10th Edition, unless otherwise specifically provided m these Bylaws. Section 6 Compensation of Members. Members shall not receive any salary or compensation for their services as Members of the Committee. Section 7 Liability of Members All Members of the Committee shall be covered by the City's Personal Liability Indemnity Plan, as set forth in the Code of the City of Fort Worth, Section 2 290(a), as may be amended. ARTICLE III OFFICERS Section 1 Titles and Term of Office The officers of the Committee shall be the Chair and the Vice Chair and such other officers as the Committee may from time to time elect or appoint. The Chair and Vice Chair shall be appointed by the Mayor subject to the approval of the City Council by Resolution. Other officers shall be elected by the Committee The term of office for all officers shall commence on the date such officer is appointed or elected and shall expire on the following September 30 Officers may be reappointed or reelected and shall not be subject to term limits. Section 2. Powers and Duties of the Chair The Chair shall be a member of the Committee and shall preside at all meetings of the Committee The Chair shall be the principal executive officer of the Committee and shall be in general charge of the business of the Bylaws of the Audit and Finance Committee Committee The Chair shall have such other powers and duties as may be assigned to him or her by the Committee. Section 3 Powers and Duties of the Vice Chair The Vice Chair shall be a member of the Committee. The Vice Chair shall perform the duties and exercise the powers of the Chair upon the Chair's death, absence, disability or resignation, or upon the Chair's inability to perform the duties of his or her office Any action taken by the Vice Chair in the performance of the duties of the Chair shall be conclusive evidence of the absence or inability to act of the Chair at the time such action was taken. The Vice Chair shall have such other powers and duties as may be assigned to him or her by the Committee or the Chair Section 4 Compensation of Officers. Officers shall not receive any salary or compensation for their services as officers. ARTICLE IV AMENDMENTS The City Council may amend these Bylaws at any time by ma~orrty vote of the City Council. Bylaws of the Audit and Finance Committee APPENDIX 1 C><ty of Fort Worth Audit and Finance Committee Charter for the Year Ending Sepember 30, 2007 1 Oversee the appointment of the independent auditors and establish the related audit fees. Review and evaluate the performance of the independent auditors. Review with the full Council an ro osed discharge of the inde endent auditors. 2 Review with management the policies and procedures with respect to the City's Elected Officials and management's use of expense accounts, public monies, and public property including, for example, their use of City vehicles Consider the results of any review of these areas by the City Auditor or the independent auditors. 3 Consider with management, the rationale for employing audit firms other than the principal independent auditors for services that the City or the independent auditor determine would not be appropriate for the independent auditor to perform. 4 Inquire of management, the City Auditor and the independent auditors about significant risks or exposures facing the City assess the steps management has taken or proposes to take to minimize such risks and periodically review compliance with such steps. 5 Review with the independent auditor the controller/finance director of the Ctty• and the City Auditor the audit scope and plan of the City Auditor and the independent auditors. Address the coordination of audit efforts to assure the completeness of coverage, reduction of redundant efforts, and the effective use of audit resources. 6 Review with management and the City Auditor • Significant findings on internal audits during the year and management's responses thereto • Any difficulties the internal audit team encountered in the course of their audits, including any restrictions on the scope of their work or access to required information • Any changes required to the scope of their internal audits • The internal audit department budget and staffing • The internal audit department charter • The internal audit department's compliance with applicable standards (for example, Government Auditing Standards or the Institute of Internal Auditors (IIA s) Standards for the Professional Practice of Internal Auditing) 7 Inquire of the City Manager and Chief Financial Officer ("CFO") regarding the fiscal health of the City as well as the financial status of the City in relation to the adopted budget. 8 Review with the independent auditors and the Crty Auditor • The adequacy of the City's internal controls including computerized information system controls and security • Any related significant findings and recommendations of the independent auditors and internal auditors together with management's responses thereto (S ee the tools `Internal Control A Tool for the Audit Committee and `Fraud and the Responsibilities of the Government Audit Committee" in this toolkit.) 9 Review with the independent auditors the financial statements and management letters of the City of Fort Worth s Employees Retirement Fund. Evaluate the impact of the Retirement Fund s obligations on the City's fiscal condition. Conduct a comprehensive review of the City's Retirement Fund Bylaws of the Audit and Finance Committee ordinance at least once each fiscal year and recommend revisions to the ordinance as necessary Recommend as necessary the commission of actuarial studies, asset allocation studies, plan assumption studies and other professional reports and reviews to measure the Retirement Fund s overall health and its comparison to other public employees retirement funds based on data prepared by the National Conference on Public Employees Retirement Systems (NCPERS) 10 Review with management and the independent auditor the effect of any regulatory and accounting initiatives, such as related organizations financing structures, derivatives, or securities lending. 11 Review with the independent auditor that performs the financial statement audit: • All critical accounting policies and practices used by the City • All alternative treatments of financial information within generally accepted accounting principles that have been discussed with the City's management, the ramifications of each alternative, and the treatment preferred by the City 12. Review all significant written communications between the independent auditors and management, such as any management letter or schedule of unadjusted differences. 13 Review the City's Financial Management Policy Statements for revisions and annual adoption by the City Council 14 Review with management and the independent auditors: • The City's annual financial statements, related footnotes, and management's discussion and analysis • The independent auditors audit of the financial statements and their report thereon • The independent auditors judgments about the quality not dust the acceptability of the City's accounting principles as applied in its financial reporting • The independent auditors single audit of the federal awards administered by the City and their reports thereon • Any significant changes required in the independent auditors audit plan • Any serious difficulties or disputes with management encountered during the audit • Matters required to be discussed by Statement on Auditing Standards (SAS) No 61 Communication With Audit Committees (AICPA, Professional Standards, vol. 1 AU sec 380), as amended, U S Government Accountability Office s Government Auditing Standards• and the U S Office of Management and Budget's Circular A 133 related to the conduct of the audits 15 Review with the City Attorney and the City Auditor legal and regulatory matters that, in the opinion of management, may have a material impact on the financial statements and compliance with federal, state, and local laws and regulations. 16 Periodically review the City's code of conduct to ensure that it is adequate and up to date Review with the City Auditor and the City Attorney the results of their review of compliance monitoring with the code of conduct. 17 Review the procedures for the receipt, retention, and treatment of complaints received by the City regarding accounting, internal accounting controls, auditing matters, or suspected fraud that may be submitted by any party internal or external to the organization. Review any complaints that might have been received, current status, and resolution if one has been reached. Bylaws of the Audit and Finance Committee 18 Review procedures for the confidential, anonymous submission by the City's employees of concerns regarding questionable accounting or auditing matters, or suspected fraud. Review any submissions that have been received, the current status, and the resolution if one has been reached. 19 The audit committee should evaluate the independent auditors and internal auditors. 20 Monitor and evaluate City's Enterprise Resource Planning (ERP) initiative 21 The audit committee should review its effectiveness. 22 Create an agenda for the ensuing year or review and approve the agenda submitted by the City Auditor Bylaws of the Audit and Finance Committee City of Fort Worth, Texas DATE Tuesday October 31 2006 LOG NAME 02FIN AUD-01 REFERENCE NO G-15473 SUBJECT Adopt Bylaws and Charter of the Audit and Finance Advisory Committee ,~ RECOMMENDATION It is recommended that the City Council adopt the attached Bylaws and Charter of the Audit and Finance Advisory Committee DISCUSSION On October 3 2006 the City Council created the Audit and Finance Advisory Committee (the 'Committee") pursuant to Resolution No 3417 10-2006 (M&C G-15432) The M&C approved by the City Council stipulated that the bylaws governing the Committee and outlining the scope of duties, responsibilities and oversight of the Committee would be brought back to the City Council for final approval once the Committee had met and provided input. A letter was presented to the Mayor and City Council dated September 28, 2006 requesting the review of the draft Bylaws and draft Charter for the Audit and Finance Advisory Committee City staff recommends that the City Council adopt the attached bylaws and charter governing the Committee. The only addition to the charter from the draft presented to the City Council on September 28 2006 is an increase in the Committee's purview over Retirement Fund matters (item No 9 on the charter) FISCAL INFORMATIONICERTIFICATION The Finance Director certifies that this action will have no material effect on City funds. TO FundlAccountlCenters FROM Fund/AccountlCenters Submitted for City Manager's Office by_ Karen Montgomery (6222) Originating Department Head. Karen Montgomery (6222) Additional Information Contact: Peter Vaky (7601) Logname 60SOUTHWEST Page 1 of 1