M I N U T E S ASC-2009-6
The Audit Subcommittee met on November 12, 2009, at 8:30 a.m. in the Council Chamber, Regional Administrative Headquarters, 10 Peel Centre Drive, Suite A, Brampton.
|E. Kolb, C. Corbasson, G. Miles *, A. Thompson, R. Whitehead|
|Also Present:||D. Szwarc, Chief Administrative Officer; N. Trim, Chief Financial Officer and Commissioner of Corporate Services; K. Gillespie, Commissioner of Employee & Business Services; J. Menard, Commissioner of Human Services; P. Wallis, Director, Internal Audit; S. Hewitt, Director, Operations Support Public Works, H. West, Committee Clerk|
* See text for arrivals
¨See text for departures
Chaired by Councillor R. Whitehead
1. DECLARATIONS OF CONFLICT OF INTEREST - Nil
2. APPROVAL OF AGENDA
That the agenda for November 12, 2009, Audit Subcommittee meeting be approved.
3. DELEGATIONS/PRESENTATIONS - Nil
a) Community Programs Funding Audit
Presentation by Sandra Solonik, Supervisor of Transition and Integration Administration, Region of Peel and Anita Stellinga, Director, Community Investment, United Way
Paul Wallis, Director, Internal Audit provided an overview of the Community Programs Funding Audit report noting that there are no significant issues. Recommendations presented were opportunities for improvement including updating policies and managing funds based on overall risk. There is a good cooperative relationship between the Region and the funding agencies that were visited.
Councillor Thompson suggested that staff acquire the Agricultural Annual Report which provides a financial audit statement including the projects that have been completed.
Sandra Solonik, Supervisor of Transition and Integration Administration, Region of Peel stated that the work around the community investment strategy which is a collaborative effort with the United Way has provided an opportunity to share best practices around funding. The Grants Ad Hoc Committee is currently reviewing the three main funding streams with recommendations to be made at the February 2010 committee meeting. Consultation with other municipalities are being held to share grant funding processes and best practices. Sandra Solonik reviewed the action plans to address the seven recommendations.
Anitta Stellinga, Director Community Investment, United Way of Peel Region, elaborated on the Management Action Plan for recommendation number 6 being a joint/streamlined funding process between the United Way and the Region of Peel which will provide better advocacy and collaboration in dealing with funding requests, reporting and the impact of funding for the community.
Sandra Solonik stated that the timing of the audit was highly beneficial to the Region of Peel Grants program as it provided an opportunity to discuss improvements to the program and provided feedback from the United Way and other community organizations.
Councillor Thompson suggested that Sandra Solonik and Anitta Stellinga meet with the President of the Peel Federation of Agriculture to discuss funding processes.
Regional Chair Kolb requested that the issue of insurance risks and justification of the amount of coverage required be reviewed through risk management. He noted that the community groups are run by volunteers and asked that they be given an opportunity to voice any issues that they may have with the funding process at the next Grants Ad Hoc committee meeting. Sandra Solonik responded that the United Way and the Region of Peel are meeting with the Community Groups jointly and that feedback will be provided at the next Grants Ad Hoc committee meeting scheduled for February 2010.
Councillor Whitehead commented on the recommendation that addressed the provision of written feedback to agencies that are declined grants. He suggested that written correspondence be provided to those agencies who receive a grant with respect to time limitations and that the funding is not to be determined as ongoing.
b) Audit Subcommittee and Region Management Audit Oversight Handbook
Presentation by Paul Wallis, Director of Internal Audit
Paul Wallis stated that the changes to the Terms of Reference for the Audit Subcommittee and the Internal Audit Charter are necessary to bring them up-to-date with the requirements of the Institute of Internal Auditors quality assurance review process, which Internal Audit is currently undergoing. The internal Terms of Reference will be renamed the Audit Charter. Paul Wallis referred to the Internal Audit Guide which is a tool that can be used by the Audit Subcommittee, members of Council and management staff to understand the audit process and the value provided to the organization. The Audit Subcommittee Oversight Manual will be replaced with the Audit Subcommittee and Region Management Oversight Handbook.
Paul Wallis highlighted the important changes to the Audit Subcommittee Charter including the addition of an Objective and Authority section that replaced the old Purpose and Goals, which results in an overarching accountability statement for Audit Subcommittee; more specific information on ethics and code of conduct; and improved language on risk management and internal controls.
Paul Wallis requested that Internal Audit activities be approved by the Audit Subcommittee through the three year work plan and that the plan be continually updated and reviewed throughout the three year cycle.
Paul Wallis identified the amendments to the Internal Audit Charter which better aligns Internal Audit with the current definition by the Institute of Internal Auditors, which is a world recognized definition of Internal Audit. The addition of the Principles section provides overarching principles for a successful internal audit activity, and covers the role of consulting, the advice that can be provided and the management commitment to support a strong internal audit environment. The scope of work provides more definitive language around governance, risk and fraud. The Fraud section includes the expanded role as defined by the Institute of Internal Auditors to ensure there are proper processes in place to handle fraud and that the organization is well aware of the risk of fraud. The Accountabilities section has been expanded to provide a broader operational and management focus. Reporting Relationships is now a standalone section and the Authority section has been expanded to identify what Internal Audit should not do. The Responsibility section has been expanded to include consulting services which audit provides and operational issues to measure the effectiveness of Internal Audit and keep everyone informed of emerging issues.
Paul Wallis indicated that the Internal Audit Guide will be distributed in a booklet form with a tip card for quick reference and guidance about the Internal Audit process. It will be available for all members of Council.
Councillor Thompson congratulated staff on the report. Councillor Thompson enquired if the name will be changed from Audit Subcommittee to the Audit Committee. He also suggested that there is a need to report to Council that the Internal Audit process is being streamlined.
Chair Whitehead provided staff direction to undertake a report to General Committee to rename the Audit Subcommittee to the Audit Committee.
Chair Whitehead requested that the Internal Audit Guide be distributed to the area municipalities.
That the Audit Subcommittee and Region Management Audit Oversight Handbook (Handbook), including revisions and updates to the Audit Subcommittee and Internal Audit Charters, be approved.
c) Audit Subcommittee Direction - Process to Manage Contract Deficiencies
Paul Wallis indicated that an audit has been scheduled for next year to review the project management standards, specifically the Corporate Project Management Methodolgy within the Region of Peel. The deficiency payment process will be included in this audit to respond to a question raised by Councillor Corbasson at the October 8, 2009 Audit Subcommittee meeting.
David Szwarc, Chief Administrative Officer responded that a formal policy regarding contract deficiencies has been in place since January 1, 2009. It is a policy that we have been building for approximately the last three years.
d) Region of Peel Authority to Audit the Finances and Management Practices of Conservation Authorities
Councillor Miles arrived at 9:10 a.m.
Paul Wallis stated that Internal Audit cannot audit Conservation Authorities unless:
- The Region of Peel is invited by the Board of Directors to conduct an audit; or
- There is a memorandum of agreement with the Conservation Authorities that includes an audit clause.
Neither provision is currently available to the Region of Peel.
Councillor Thompson raised concern that approximately one per cent of the tax base goes to conversation authorities and that the Region of Peel does not have a way to look after the municipal interests. He asked if we have a memorandum of understanding for the conservation authorities projects that the Region funds.
Paul Wallis responded that we do not currently have a memorandum of understanding with the conservation authorities.
Councillor Thompson raised the following recommendation.
Whereas, almost one per cent of the Regional tax base is provided to the Conservation Authorities for implementation of their programs;
And whereas, the Region of Peel has no authority to audit the management and financial practices of the Conservation Authorities which it funds unless there is a memorandum of agreement between the funder and the recipient, or an invitation is initiated by the Conservation Authority Board of Directors;
Therefore be it resolved, that Regional staff prepare a letter respectfully requesting the Board of Directors of the local Conservation Authorities, to consider that Region of Peel Audit staff conduct audits of the Conservation Authorities management and financial practices.
5. COMMUNICATIONS - Nil
6. IN CAMERA MATTERS - Nil
7. OTHER BUSINESS - Nil
8. NEXT MEETING
The next meeting date of the Audit Subcommittee is scheduled for February 11, 2010 at 8:30 a.m., Regional Administrative Headquarters, Council Chamber, 5th floor, 10 Peel Centre Drive, Suite A, Brampton, ON. Please forward regrets to Helena West, Legislative Specialist, (905) 791-7800, extension 4697 or email@example.com.
The meeting adjourned at 9:14 a.m.