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2019-08-20 Audit/Finance Committee Minutes1 � . � 1 1 � U ► ►l ► - After determining that a quorum was present, the Audit/Finance Committee of the City of Denton, Texas, met for a regular meeting on August 20, 2019, at 10:30 a.m., in the City Hall Conference Room, at City Hall, 21 S E. McKinney Street, Denton, Texas. PRESENT: Mayor Chris Watts, Council Member John Ryan, and Council Member Paul Meltzer. STAFF PRESENT: Antanio Puente, Chief Financial Officer, Frank Dixon, Police Chief, Umesh Dalal, City Auditor, David Gaines, Director of Finance, Harvey Jarvis, Cantroller, Carla Romine, Director of Human Resources, Cassandra Ogden, Director of Procurement and Compliance, Tiffany Thomson, Director of Customer Service, Kevin Ann Mullen, Deputy Director of Capital Projects, Rachel Woad, CMO Chief of Staff, Shanika Mayo, Police Administration Manager, Brian Hogan, Assistant Controller, Cody, Wood, Assistant Controller, Daniel Kremer, Deputy Director of Engineering Operations, Madison Rorschach, Staff Auditor, Neerage Sama, Staff Auditor, Cindy Hartman, Payroll Coordinator, Susan Miller, Police Administrative Supervisor, and Theresa Jaworski, Executive Assistant and Recording Secretary. OPEN MEETING: Council Member and Committee Chair, Jahn Ryan, brought the meeting to order at 10:30 a.m. 1. ITEMS FOR CONSIDERATION: A. Consider approval of the Audit/Finance Committee minutes af June 18, 2019. Committee Member Paul Meltzer made a motion to approve the June 18, 2019, Audit/Finance Meeting Minutes. Mayor Chris Watts seconded the motion. Motian passed unanimously. B. Receive a report, hold a discussion, and give staff direction regarding an internal audit of Roadway Quality Management. Staff Auditar, Madison Rorschach, explained the purpose of the audit, the Roadway Quality Management Process, planning processes that are coordinated with Streets and Utilities, equitable use of resources, construction quality dacumentation, improved monitoring efforts, followed recommendations and agreements. A discussian fallowed with Engineering staff explaining the use of overlay instead of raad reconstructian, the impartance of using appropriate documentation when deviating from the established standards setting guidelines and recommendations in addressing issues with raads, the responsibility af following up with that dacumentatian and flexibility when that need arises. � .. � � � � � � � � � �. � � � � 'r • � • � � Rorschach stated the purpose of the audit, including the amount of avertime and average amount of expenditures annually, reviewed the process and effectiveness af controls in the overtime process, administration, and management af overtime for the Police Department. The Committee discussed the largest share af overtime being for neighbarhood services or special events, who is responsible for determining hours worked, who schedules the work, and who appraves the haurs warked and wha daes the payroll, the options cansidered in handling the wark thraugh hiring outside help, additional afficers, the advantages of Internal Audit painting aut the needs for improvements and apportunities far the City Council to examine the City's overtime policy. 1'• � � r � � r' � � � •�.+� � � •� r ' . � • 1 � Rorschach noted the City of Denton's 201$ total amaunt invoiced fram suppliers and entities and presented the vendor payment pracess, explain the areas that could be improved, nating the affice supply purchases fram Staples that lack any supervisory approval, the receipt of goods that is not documented, and the check request controls that could be tightened up, Internal Audit's recommendation and issues ihat have been identified, addressed, and the plans for improvement. The Committee discussed any passible abuse af the check request process, the steps taken by Accounts Payable that are naw in place to address issues, and current cammunicatians with Staples on adding procedures ta improve the supplies order process and the City Auditar's appreciatian of the work and efforts by the Accounts Payable department. .. .; . , . � � � . � i ; r ;�, , � , � •�. � � ` . , r� . :i, r . .� . . , � • � . , �� City Auditor, Umesh Dalal, explained that the Police Department's Overtime Audit revealed implicatians set aut in the Fair Labor Standards Act and identified issues beyond the financial impact, making the City's Overtime Policy more generous than the Fair Labai• and Standard Act requires. The City Council was made aware af these issues in a memarandum dated August 16, 2019 that compared the FLSA overtime calculatian with the City's avertime calculation. � The Committee discussed that this is not an error but the City's option to be more generous. This is a policy management issue and the awareness that benefits will recruit and keep good personnel and become a determining factor when competing with other cities in the hiring process, adding that it is helpful to be aware of this information. 2. CONCLUDING ITEMS There were not concluding items to address. The meeting adjourned at 11:17 a.m. The Audit/Finance Committee approved the Meeting Minutes of August 20, 2019, on September 17, 2019 I� � ��t,, � � ���_._�_ _ ....... J��I� ��� � RYAN �� C�:� N`�!�°� � � I�'� CHAIR CITY OF DENTON ��� �� a u � � � , _��. `� . .;���� THERESA JAW�, RSKI RECORDING SECRETARY CITY OF DENTON 3