Audit Committee
Minutes
January 16, 2003, 9:00am
Civic Center Council Chambers, 1175 East Main Street
Call to Order
Chairperson Marty Levine called the meeting to order at 9:04am.
Roll Call
Committee Members Emile Amarotico, CPA, Marty Levine, CPA, Roberta Stebbins, CPA and City Recorder/Treasurer Barbara Christensen were present. Council Liaison, Mayor Alan DeBoer and Staff Liaison, Finance Director Lee Tuneberg were present. Parks and Recreation Director Ken Mickelson and Administrative Assistant Kirsten Bakke were present.
Approval of Minutes
Stebbins/Amarotico m/s to approve the November 1, 2002 Audit Committee Minutes as presented. Voice Vote: All AYES.
Update on Auditor Visit
A. GASB 34
Tuneberg discussed the Auditor visit, stating that the Auditors had been in this week and will be back in the last week of May and the audit will start right after Labor Day. He continued saying that the biggest part of the visit was preparation for GASB 34. He talked about Pauly, Rogers' team approach saying they were very efficient and professional. Tuneberg described some of the changes that the GASB 34 conversion would necessitate.
Levine asked about software compatibility in conversion. Tuneberg explained that the software was not playing a big roll in the GASB34 presentation except in the area of Eden fixed assets and that there was no incompatibility with the software. He talked about the FERC requirements (Federal Energy Regulation Commission) and how it affected accounting steps. Mickelson remarked that the biggest challenge for Parks was determining costs related to irrigation systems and those types of infrastructure fixed assets.
Tuneberg continued discussing the audit timeline and process.
B. Parks Consolidation
Tuneberg spoke about the Parks consolidation process. He said that Parks has a separate tax identification number and a sub-PERS number that is unique to Parks. He talked about new staff brought on for the Parks' transition. Mickelson said the goal was that Parks' payroll and payables would be done in Finance by July of 2003.
There was a discussion about Parks having a separate payroll and the Hospital's status as a separate agency.
Tuneberg described the payroll, receivables and job costing conversions that needed to occur to move the Parks' accounting over to Finance. He explained that these things have been on the schedule to allow Finance to do better program accounting for the City and there will be a benefit for both Parks and the City in the next 6 months. Mickelson confirmed the importance of the job costing conversion.
The discussion ensued about Parks' status in relation to the City.
Planning 02-03 Audit
Tuneberg said that the dates for the Auditors' return were tentatively set for late May with the audit starting onsite after Labor Day. He explained that with the preliminary work being done now, presentation to council may still be done before Thanksgiving even with GASB 34 requirements. He spoke about the audit process and asked the Committee if they had any suggestions or areas that they thought the Auditors' should give more attention.
Christensen asked about a review of AFN. Tuneberg suggested more testing from the Auditors'. Discussion ensued. Tuneberg clarified that the Auditors' look at everything that goes to council and said that they are testing for budget compliance and accounting. Stebbins addressed public concern about AFN sustainability due to low fees. The discussion continued regarding reviewing AFN. Christensen explained that periodic internal audits could be done in the purview of the City Recorder’s office.
Committee Discusses Changes to their Charge
The Committee discussed internal audits and the impact from the Samis incident. Stebbins voiced concern about the new requirements that might be imposed by the Sarbanes-Oxley Act of 2002. Discussion continued.
Amarotico/Stebbins m/s to recommend to Council amending the resolution verbiage to include the City Recorder and the Mayor as voting members and that three members would constitute a quorum. Voice Vote: All AYES.
Christensen suggested that Levine come up with proposed wording to recommend to the Council. Levine recommended that Stebbins check into the impact of the new law and the implications for the Audit Committee. Amarotico asked that the City Recorders role by reviewed. Tuneberg said that he would prefer internal reviews not be at the direction of one person or a few citizens, but could come to this committee if approved by council. He also pointed out workload and staffing issues. Christensen suggested that she contact the original AFN ad hoc committee to see if there was any interest in coming back; and inform Dick Wanderscheid of the discussion.
Adjournment
Meeting was adjourned at 10:42am.
Respectfully submitted by Kirsten Bakke, Administrative Assistant to the Finance Director