21-2035ORDINANCE NO. 21-2035
AN ORDINANCE OF THE CITY OF DENTON CREATING AN INTERNAL AUDIT
ADVISORY COMMITTEE TO ADVISE THE CITY COUNCIL AND CITY AUDITOR ON
AUDIT ACTIVITIES AND GOVERNANCE; AND PROVIDING AN EFFECTIVE DATE.
WHEREAS, the City Council is of the opinion and hereby finds that there are many
important issues and responsibilities facing the City Council that require a specific standing audit
advisory committee (the "Internal Audit Advisory Committee" or "Committee") to provide advice
on the organization's audit activities and governance; and
WHEREAS, subsection 2.08(q) -(r) and Section 2.13 of the City of Denton Charter
authorize the Council to provide for the auditing and investigation of the municipal affairs of the
City; and
WHEREAS, it is important that the City's internal audit function be independent and free
from improper influence or coercion; and
WHEREAS, the Government Auditing Standards, promulgated by the United States
General Accountability Office, Section 3.18 provides that the general standard related to
independence is that in all matters relating to audit work, the audit organization and the individual
auditor should be free both in fact and appearance from personal, external, and organizational
impairments to independence; and
WHEREAS, the establishment of the Internal Audit Advisory Committee will help to
ensure independence in such audit matters; and
WHEREAS, it is important that members of the Internal Audit Advisory Committee have
the collective, specific expertise necessary to effectively exercise their Committee duties and
provide advice on audit activities and governance; and
WHEREAS, the City Council is of the opinion and hereby finds the establishment of the
Internal Audit Advisory Committee is in the public interest; NOW, THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1.
There is hereby created an Internal Audit Advisory Committee as a standing committee of the City
of Denton. The Internal Audit Advisory Committee shall consist of four (4) voting members. In
addition, the City Auditor shall serve as an ex -officio non-voting member of the Committee. Any
recommendation which does not receive a majority of votes shall be deemed a negative report. A
quorum of the Committee members must be present to hold a Committee meeting or to take
Committee action, with three (3) members considered a quorum. The City Auditor shall not count
towards the establishment of a quorum.
Members of the Internal Audit Advisory Committee will be nominated and appointed by City
Council. Nominations for appointment will be taken up in the order received. Members shall be
appointed for two (2) year, staggered terms and may not be reappointed for more than three
consecutive terms. Inaugural Internal Audit Advisory Committee members shall draw straws to
determine which two (2) members shall receive an initial term of one (1) year in order to stagger
terms.
Membership on the Internal Audit Advisory Committee is limited to qualified voters of the City
of Denton. Preference in appointments shall be given to individuals in such professional fields as
auditing, accounting, finance, public administration, and risk management including the teaching
of such knowledge. The City Auditor shall participate in the vetting process for nominees to
evaluate whether they have appropriate skills and expertise.
The following shall disqualify a person from serving on the Internal Audit Advisory Committee:
(1) Current service as a City of Denton employee or City Council Member;
(2) Separation from service as a City of Denton employee or City Council Member
within one (1) year of appointment; or
(3) Familial relations to a City of Denton employee or City Council Member within
the third (3`a) degree of affinity (marriage) or consanguinity (blood or adoption).
SECTION 2.
The Internal Audit Advisory Committee shall perform the following duties:
(a) Reviewing the City Auditor's Annual Internal Audit Plan and providing recommendations
to the City Council on its adoption;
(b) Providing oversight of the internal audit function, including:
(1) Monitoring Annual Internal Audit Plan progress;
(2) Ensuring transmission of audit reports to the City Council and the public;
(3) Monitoring follow-up on reported findings to assure corrective action is taken by
management; and
(4) Reporting to the City Council on concerns at such times as deemed appropriate;
(c) Periodically evaluating and making recommendations to the City Council on auditing
standards adopted for use by the internal audit function;
(d) Evaluating the findings and recommendations of the internal audit peer review as required
by the adopted auditing standards;
(e) Providing advice to the City Auditor on audit activities and governance; and
(f) Assisting the City Council in other oversight duties related to the City's internal audit
function as needed or directed by City Council.
SECTION 3.
Any matters not covered by this ordinance, to the extent applicable to the City's advisory
committees and advisory committees' members, shall be governed with respect to the rules,
procedures, operation and affairs of the Internal Audit Advisory Committee by the Code of the
City of Denton, Texas, including, but not limited to Section 2-29 and Article III of Chapter 2, and
the City of Denton Handbook for Boards, Commissions, and Council Committees, each as
amended from time to time. The Committee shall have the authority to meet in closed session in
accordance with the requirements of the Texas Open Meetings Act.
SECTION 4.
This ordinance shall become effective immediately upon its passage and approval.
The motion to approve this ordinance was made by?0,02. and seconded
by\(i Ci(`, y the ordinance was passed and approved by the
following vote 1:
Aye Nay Abstain Absent
Gerard Hudspeth, Mayor: ,
Vicki Byrd, District 1:
Brian Beck, District 2: ✓
Jesse Davis, District 3:
Alison Maguire, District 4: ✓
Deb Armintor, At Large Place 5: ✓
Paul Meltzer, At Large Place 6: ✓
PASSED AND APPROVED this, the 17Y�0 day ofd S , 2021.
GERARD HUDSPETH, MAYOR
ATTEST: ,101111811,0"
ROSA RIOS, CITY SECRETARY
BY:
5
APPROVED AS TO LEGAL FORM:
MACK REINWAND, CITY ATTORNEY
Digitally signed by Mack
Reinwand
BY: aWkDate: 2021.10.]3 1Q;32:02
BY: -05'00'