2010-10-19 Audit/Finance Committee MinutesAudit/Finance Committee
Minutes
October 19, 2010
After determining that a quorum was present, the Audit/Finance Committee of the City of
Denton, Texas convened in a regular meeting, on Tuesday, October 19, 2010, at 2:00 p.m. in
the City Hall Conference Room at City Hall, 215 E. McKinney Street, Denton, Texas.
PRESENT: Mayor Mark Burroughs; Council Member James King, Council
Member Chris Watts, Chair
STAFF PRESENT: George Campbell, City Manager; Fred Greene, Assistant City
Manager, Bryan Langley, Chief Financial Officer, Antonio Puente,
Assistant Director of Finance; Harvey Jarvis, Controller; Caroline
Finley, Treasury Administrator, Michelle McCallum, Budget and
Municipal Court Manager
The meeting was called to order at 2:05 p.m.
1. Consider approval of Audit/Finance Committee Minutes of April 5, 2010.
Mayor Burroughs moved to approve the minutes of April 5, 2010, with a second by Chris
Watts. The minutes were approved (3-0).
2. Management Report —
a. Audit/Ffnance Commfttee Action Item Matrix
The Committee discussed Matrix Action Item 108, Provide results of the EMS Audit, and
other audits that were in various stages of completion. Mayor Burroughs requested a
summary and current status of each audit that was in process before the Internal Auditor left
the City.
Actfon Item
Provide a summary of the outstanding audits being addressed and the current status of
each audit.
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Bryan Langley, Chief Financial Officer, explained that the intent of this item was to give the
Committee an opportunity to discuss the report and make suggestions on irnproving the
report. Two additional improvements are under consideration. Staff is proposing that the
Fund Balance Information be expanded for each of the major operating funds. There are
some reservations or potential uses for those dollars and accordingly, we want to arrive at
the true working capital figure available and include that information in the next report. For
the first quarter report for 2010-11, we also will add the Airport Fund in the quarterly report.
The committee discussed the value of knowing the fund balances and asked for information
on all the fund balances to be included in the report.
Action Item
Provide a summary that will include fund balance information on all budgeted funds
in future quarterly �nancial reports.
c. Update on Fixed Asset System Implementation
Langley reported that the Fixed Asset System is finally implemented in JD Edwards for the
new 2010-11 fiscal year. We still have additions and deletions for the past fiscal year that
need to be run through the system but that process should be complete by November 15.
There were a couple of partners working on this. MarketSphere, a consulting firm that
specializes in JD Edwards, was hired to help implement the software. We also hired
Weaver and Tidwell to come back and validate the install to ensure that all assets were
correctly stated and that depreciation calculations were performed properly.
A discussion about depreciated fixed assets and income from the sale of those items
followed.
3. Receive a report, hold a discussion, and give staff dfrectfon regarding revfsions to
the City of Denton's Investment Policy.
Langley reminded the committee that the Investment Policy is required to be approved by
the City Council once a year. Along with staff titles, explained the following changes:
• Incorporation of the utility reserve fund into the City's intemal investment pool.
• Providing a summation of cornmittee meeting discussions rather than formal
minutes.
• Designation of the Investment Policy as the primary guideline for the City's
investment program and procedures.
• Securities and Exchange Commission (SEC) required changes for all AAAm, Aaa,
or equivalently rated money market mutual funds to maintain a 60 day or less
weighted average maturity.
• Inclusion of bank balances in the definition of investment pool liquidity.
• Establishment of bidding procedures for purchases of certificates of deposit.
Langley also reminded the committee that staff would like to present the revised policy to
the City Council at the November 2, 2010, meeting.
The committee questioned the merit of providing a summation of cornmittee meeting
discussions instead of preparing actual meeting minutes.
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AND
Under Section 551.0415 of the Texas Open Meetings Act, provide reports about
items of community interest regarding which no action will be taken, to include:
expressions of thanks congratulations or condolence; information regarding
holiday schedules; an honorary or salutary recognition of a public official, public
employee, or other citizen; a reminder about an upcoming event organized or
sponsored by the governing body; information regarding a social, ceremonial, or
community event organized or sponsored by an entity other than the governing
body that was attended or is scheduled to be attended by a member of the
governing body or an official or employee of the municipality; or an announcement
involving an imminent threat to the public health and safety of people in the
municipality that has arisen after the posting of the agenda.
Council Member Watts requested information on the City's policies related to developer
escrow agreements. Specifically, Council Member Watts requested a summary of developer
escrow deposits and construction spending that has occurred by the City over the past
several years.
Langley offered to provide that information in a future meeting.
Action Item
Provide information on the City policies and financial activity related to developer
escrow agreements.
Langley advised the committee of a tentative Audit/Finance Committee meeting date for the
November 16 time frame. We are looking at bringing the bank contract and reviewing that
with you. We hope to place this item on the December 7 Council Agenda. After we have a
chance to go through the contracts, we will get back to you.
With no more items to consider, tl�� meeting adjourned at 2:37 p.m.
CHRIS '�`�'11' i`� ` ¢ �.'
COMMITTEE CHAIR
CITY OF DENTON, TEXAS
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THERESA J� �(�F� � l
RECORDING SECRETARY
CITY OF DENTON, TEXAS
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