HomeMy WebLinkAboutResolution 4900-01-2018 A Resolution
NO. 4900-01-2018
APPROVING A REVISED AND AMENDED
CHARTER FOR THE AUDIT COMMITTEE OF
THE FORT WORTH CITY COUNCIL
WHEREAS, since 2006 the Fort Worth City Council has benefitted from advice and
recommendations of a committee charged with addressing audit-related issues (Resolutions
3417-10-2006, 3430-11-2006, 3775-08-2009, 3802-10-2009; M&C G -
15473); and
WHEREAS, since 2012 a standing committee consisting of four members of the
City Council has served as the Fort Worth City Council Audit Committee (the
"Committee") and operated under a Council-approved Charter (Resolution No. 4156-12-
2012); and
WHEREAS, after reviewing the Charter, staff presented the Committee with
recommended charter revisions at its December 12, 2017 meeting with such changes
aimed at more closely aligning Committee charges with its core mission of providing
advice to the City Council with respect to oversight for financial reporting, internal
controls and auditing activities and at conforming with auditing best practices; and
WHEREAS, the Committee concurred with staff's recommendations and approved
presentation of a revised Charter to the City Council for consideration; and
WHEREAS, appended hereto as Attachment 1 is the proposed revised Committee
Charter, reflecting changes recommended by staff and agreed to by the Committee.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF FORT WORTH, TEXAS:
1. That the Charter attached hereto as Attachment 1, is hereby approved and shall
govern the duties and responsibilities of the Committee from the date of
Adoption of this Resolution until such time as the City Council may adopt a
revised charter for the Committee by Resolution .
2. That this resolution and the attached Charter shall be effective upon approval.
Adopted this 30th day of January, 2018.
ATTEST:
By:__
-- -- — —
Mary J. Kayser, Ci ecretary
ORTWO
FORTWORTH
.......
Attachment 1
City of Fort Worth
Audit Committee Charter
The Audit Committee(the"Committee")shall provide advice to the City Council with respect to oversight
for financial reporting,internal controls and auditing activities.The Committee shall not have direct authority
over any such matters,but may vote to recommend that the City Council take certain actions,or recommend
that the City Council direct the City Manager to take certain actions. The City Council may refer appropriate
matters for review by the Committee,but the Committee's oversight of such matters shall be purely advisory
in nature. In accordance with the City Charter's establishment of a Manager/Council form of government,
Committee members shall make all requests and direct all inquiries to the City Manager,or other designated
City official assigned as staff liaison for the Committee and shall not give orders or directions to any other
administrative staff subordinates.
Committee Membership
In accordance with the City Council Rules of Procedure, the Audit Committee is a standing
committee consisting of four City Council members with membership and Chair as appointed by
the Mayor.
Three members of the Audit Committee shall constitute a quorum.
Committee Reports
As detailed in the City Council Rules of Procedure, all matters discussed by the Committee shall
either (a) be referred to the Committee by the Mayor after presentation to the City Council at a
City Council Work Session or City Council Meeting, if a more in-depth review and discussion by
a smaller group would be beneficial, or (b) be placed on a Committee agenda prior to taking the
matter to the full Council.
It shall be the responsibility of the Committee to provide thorough review of the matters brought
before it and to provide feedback to the City Manager, or the full City Council, through either a
consensus or a formal committee recommendation.
Committee Meetings
The Audit Committee shall generally meet monthly. While there may be instances where the Audit
Committee Chair deems a monthly meeting unnecessary, the Audit Committee shall meet no less
frequent than quarterly.
All Committee meetings shall be open meetings posted in accordance with the Texas Open
Meetings Act requirements.
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Committee Duties
Unless otherwise indicated below or specifically requested by the City Council,the Committee shall perform
or undertake the followingtasks as the Committee determines,in its sole discretion,to be necessary:
1. Annually review and make recommendations with respect to the appointment of the
independent auditors and the related audit fees. Review and evaluate the performance of the
independent auditors and make related recommendations to the City Council.
2. Make recommendations as to the necessity of employment of audit firms other than the
principal independent auditors for services that the City or the independent auditor
determines would not be appropriate for the independent auditor to perform.
3. Inquire of the City Manager's Office, 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.
4. Annually review with the independent auditor, the Finance director/Chief Financial Officer of
the City, the City Manager's Office, 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.
5. 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 in 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)
6. Review with the independent auditors and the City Auditor:
• The adequacy of the City's internal controls, including but not limited to,computerized
information system controls and security, cash handling, credit card transactions and
electronic funds transfers
• Any related significant findings and recommendations of the independent auditors and
internal auditors together with management's responses thereto
(See the tools "Internal Control: A Tool for the Audit Committee" and "Fraud and the
Responsibilities of the Government Audit Committee" in this toolkit.)
7. Review with the City Manager's Office and the independent auditor the effect of any
regulatory and accounting initiatives, such as related organizations financing structures,
derivatives, or securities lending.
8. 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.
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9. Annually review the City's Financial Management Policy Statements for revisions and
annual adoption by the City Council.
10. Review with the City Manager's Office 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 just 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
• All significant written communications between the independent auditors and management,
such as any management letter or schedule of unadjusted differences
11. Review with the City Attorney and the City Auditor legal and regulatory matters that, in the
opinion of the City Manager's Office, may have a material impact on the financial statements
and compliance with federal, state, and local laws and regulations.
12. 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.
13. 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.
14. Review the Committee's own effectiveness as necessary, and make recommendations to the
City Council regarding desired changes to this Charter.
15. Ensure continued auditor independence by recommending regular rotation of the registered
public accounting firm/external auditor.
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