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Decision Document |
|
Audit Committee |
Meeting No. | 15 | Contact | Rosemary MacKenzie, Council Administrator | |
Meeting Date |
Friday, February 12, 2010 |
Phone | 416-392-8021 | |
Start Time |
9:30 AM |
rmacken@toronto.ca | ||
Location |
Committee Room 1, City Hall
|
Chair | Councillor Doug Holyday |
The Decision Document is for preliminary reference purposes only. Please refer to the Committee’s Report to City Council or to the Minutes for the official record. |
AU15.1 | ACTION |
Amended |
|
Ward: All |
2009 Annual Report – Fraud and Waste Hotline |
Committee Recommendations |
The Audit Committee recommends that:
1. City Council request the City Manager to review the recommendations contained in the Bellamy Report on the Toronto Computer Leasing and Toronto External Contracts Inquiries in order to ensure that all recommendations pertaining to ethics training are addressed. Further, training required as a result of the Bellamy recommendations be required to specifically address conflict of interest issues, and be made mandatory for all City staff. |
Decision Advice and Other Information |
The Audit Committee requested the Executive Director, Human Resources, to report to the first meeting of the Audit Committee in 2011, on the final outcome of employee terminations which occurred in 2007 to 2009 as a result of fraud, and whether the terminations were upheld if referred to an arbitrator, where a final decision is available.
The Auditor General and the Director, Forensic Unit, Auditor General's Office, made a presentation to the Audit Committee on the 2009 Annual Report - Fraud and Waste Hotline.
The Audit Committee recessed its public session and met in closed session to consider confidential information on this Item as it relates to:
1. personal matters about identifiable individuals, including municipal or local board employees; 2. labour relations and employee negotiations; and 3. litigation or potential litigation affecting the municipality or local board. |
Origin |
(January 7, 2010) Report from the Auditor General |
Summary |
In June 2000, Audit Committee requested that the Auditor General submit an annual report on the status of fraud and related matters. This report represents the Auditor General’s ninth report on the activities of the Fraud and Waste Hotline program for the period of January 1, 2009 to December 31, 2009.
During 2009, the Fraud and Waste Hotline received 677 complaints, an increase of nine per cent from the 619 complaints received in 2008. This amount represents an increase of 184 per cent from the initial 238 complaints received by the Hotline in 2003, its first full year of operation.
In 2009, there were a number of complaints received which related to contraventions or potential contraventions of the City’s Conflict of Interest Policy. There continues to be a less than clear understanding of circumstances which may constitute a real, potential or perceived conflict.
In 2006, the Auditor General’s Office made a recommendation regarding expediting the implementation of formal ethics training to all City staff. While ethics training, including training on conflicts of interest has been introduced, it has not been provided to all management staff. Further, ethics training continues to be outstanding for all non-union staff.
Madame Justice Bellamy in her report relating to the Toronto Computer Leasing Inquiry and the Toronto External Contracts Inquiry made specific recommendations in relation to staff training. This staff training needs to be extended to all staff and at the same time evaluated to ensure that it is effective. |
Background Information |
Report (January 7, 2010) from the Auditor General - 2009 Annual Report - Fraud and Waste Hotline (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27130.pdf) Appendix 1 - 2009 Annual Report - Fraud and Waste Hotline, Auditor General's Office (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27131.pdf) Presentation material submitted by the Auditor General - 2009 Fraud and Waste Hotline Report (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27385.pdf) |
AU15.2 | ACTION |
Amended |
|
Ward: All |
Controls Over Parking Tags Need Strengthening |
Committee Recommendations |
The Audit Committee recommends that:
1. City Council request the Treasurer to review the practices currently adopted by 407 International Inc. in connection with the collection of out-of-province receivables. Such a review also include the practices of other jurisdictions. Further, the Treasurer review the potential use of collection agencies. If required, requests for amendments to provincial legislation be made in order to facilitate the collection of out-of-province receivables.
2. City Council request the Treasurer to re-evaluate the criteria supporting the discretionary cancellation of parking tags. Policies and procedures concerning the preparation and retention of documentation in support of cancellations be developed. Supporting documentation be randomly reviewed by supervisory staff. In addition, management reports be developed and reviewed on an ongoing basis to identify anomalies and trends.
3. City Council request the Treasurer, in consultation with the Chief Information Officer, to review the potential of automating certain aspects of the documentation requirement process as it pertains to pre-court filing documents and request for trials. Such a process should be conducted in consultation with the City Solicitor in order to ensure that the automation of certain processes is not contrary to legislation and, if required, amendment to the provincial legislation be requested.
4. City Council request the Treasurer to review the parking enforcement process as it relates to the issue and cancellation of parking tags for delivery and courier vehicles. Such a review include an evaluation of best practices in other Canadian and US jurisdictions. If required, amendments to provincial legislation be requested.
5. City Council request the Treasurer to direct all staff that parking tag adjustments processed through the Parking Tag Management System are appropriately documented and that each adjustment be accompanied by an appropriate audit trail. Such documentation be reviewed on a random basis by supervisory staff.
6. City Council request the Treasurer to review the current plate denial process. Such a review take place in consultation with the Ministry of Transportation and focus on the reasons why significant receivables continue to be outstanding beyond the two-year licence plate renewal period. Improvements identified be implemented in order to maximize the effectiveness of the plate denial system.
7. City Council request the Treasurer to review the parking tag collection process, prioritise those receivables which relate to individuals and entities who have significant receivables owing on multiple plates and consider conducting corporate searches to identify these entities. Once identified the appropriate follow-up process be conducted including the use of collection agencies specifically directed to these accounts.
8. City Council request the Treasurer to review the possibility of providing collection agencies with specific information including the names and addresses of individuals and companies with outstanding parking tags. Amendments to provincial legislation be requested, if required.
9. City Council request the Treasurer to review the extent of receivables submitted to collection agencies such that collection agencies are provided information on entities who have parking tags owing on more than one vehicle. Finally, the Treasurer consider providing collection agencies with more up to date receivable information.
10. City Council request the Treasurer, in consultation with the Chief Information Officer, to review the current cheque processing system so that payments relating to tags in plate denial status and payments which have previously been made are identified more easily by those staff receiving payment. Such a process would reduce the administrative process of issuing refund cheques.
11. City Council request the Treasurer to review the merits of amending the cheque collection process so that NSF fees are clearly identified and subsequently collected. Amendments to provincial legislation be requested, if required.
12. City Council request the Treasurer to develop a formal change control process. Application development should be separate from system administration, and developers should not install their own programs to the production environment.
13. City Council request the Treasurer to develop and implement a formal access control and review process. A review of user access should occur periodically and unauthorized users deleted from the authorized user list. |
Origin |
(January 27, 2010) Report from the Auditor General |
Summary |
Our review identified opportunities for strengthening controls in the administration of parking tag revenues. Certain of our recommendations, however, will necessitate negotiation with the Province and will require legislative change. In view of the significant potential revenue opportunities, such negotiations should occur as soon as possible. |
Background Information |
Report (January 27, 2010) from the Auditor General, Controls Over Parking Tags Need Strengthening (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27125.pdf) Appendix 1 (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27126.pdf) Appendix 2 - Management's Response (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27127.pdf) |
Communications |
(February 5, 2010) E-mail from Alan Heisey (AU.New.AU15.2.1) |
AU15.3 | ACTION |
Adopted |
|
Ward: All |
Results of Request for Proposal 9171-09-7137 - External Audit Services for the City of Toronto and Its Major Agencies, Boards and Commissions |
Confidential Attachment - The security of the property belonging to the City or one of its agencies, boards and commissions |
Committee Recommendations |
The Audit Committee recommends that:
1. City Council grant authority to enter into an agreement with PriceWaterhouseCoopers LLP for external audit services for fiscal years 2010 through 2014 inclusive for $4,085,000 (net of all applicable taxes) as per the fee schedule outlined in Confidential Attachment 2 to the report (January 25, 2010) from the Auditor General, and under terms satisfactory to the Auditor General and the City Solicitor.
2. City Council authorize the public release of the confidential information in Attachment 2 to the report (January 25, 2010) from the Auditor General, upon Council’s approval of this contract award to PriceWaterhouseCoopers LLP and PriceWaterhouseCoopers LLP signing the contract.
3. City Council direct that the confidential information in Attachment 3 to the report (January 25, 2010) from the Auditor General, remain confidential.
4. City Council authorize and direct the appropriate City officials to take the necessary action to give effect thereto. |
Decision Advice and Other Information |
The Audit Committee recessed its public session and met in closed session to consider confidential information on this Item as it relates to the security of the property belonging to the City or one of its agencies, boards and commissions. |
Origin |
(January 25, 2010) Report from the Auditor General |
Summary |
The purpose of this report is to advise on the results of Request for Proposal (RFP) 9171-09-7137 for external audit services to perform the financial statement audits for the City of Toronto and its major agencies, boards, and commissions for the years ending 2010 to 2014 inclusive and to request authority to enter into an agreement with the recommended proponent. |
Background Information |
Report (January 25, 2010) from the Auditor General, Results of Request for Proposal 9171-09-7137 - External Audit Services for the City of Toronto and its Major ABCs (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27141.pdf) |
AU15.4 | ACTION |
Received |
|
Ward: All |
Annual Report - Auditor General's Office - Benefits to the City of Toronto |
Committee Decision |
The Audit Committee received for information, the report (January 21, 2010) from the Auditor General. |
Origin |
(January 21, 2010) Report from the Auditor General |
Summary |
This report responds to a request from the Audit Committee that the Auditor General, “provide the value added of his department.”
At the request of the Audit Committee, attempts have been made to identify the extent of the quantifiable financial benefits which have resulted from the work conducted by the Auditor General’s Office.
While certain reports have resulted in tangible cost savings, the more important benefits provided relate to the avoidance of future costs, as well as the protection of City assets. Nevertheless, tangible annual cost savings have occurred, or will occur, as a result of the work conducted by the Auditor General. Over the five-year period commencing January 1, 2005, the estimated potential savings to the City are in the range of $87 million compared to a cumulative audit expenditure of $17.6 million. In simple terms, for every $1 invested in the audit process the return on this investment has been $5.0. Many of the estimated cost savings are ongoing and occur on an annual basis. |
Background Information |
Report (January 21, 2010) from the Auditor General, Annual Report - Auditor General's Office - Benefits to the City of Toronto (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27142.pdf) Appendix 1 (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27143.pdf) |
AU15.5 | ACTION |
Adopted |
|
Ward: All |
Auditor General's Outstanding Recommendations on Reports from 1999 - 2005 |
Committee Recommendations |
The Audit Committee recommends that:
1. City Council receive for information, the report (January 5, 2010) from the City Manager. |
Origin |
(January 5, 2010) Report from the City Manager |
Summary |
This report outlines the City Manager’s response to Audit Committee’s request of October 20, 2009 as to the status of recommendations made by the Auditor General since January 1, 1999. |
Background Information |
Report (January 5, 2010) from the City Manager, Auditor General's Outstanding Recommendations on Reports from 1999 - 2005 (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27144.pdf) |
AU15.6 | ACTION |
Adopted |
|
Ward: All |
Report on Negotiations with the City's Actuaries |
Confidential Attachment - Litigation or potential litigation affecting the City |
Committee Recommendations |
The Audit Committee recommends that:
1. City Council receive the report (January 22, 2010) from the Deputy City Manager and Chief Financial Officer for information.
2. City Council direct that the confidential information contained in Attachment 1 to the report (January 22, 2010) from the Deputy City Manager and Chief Financial Officer, remain confidential and not be released publicly as it involves litigation or potential litigation that affects the City. |
Decision Advice and Other Information |
The Audit Committee recessed its public session and met in closed session to consider confidential information on this Item as it relates to litigation or potential litigation affecting the City. |
Origin |
(January 22, 2010) Report from the Deputy City Manager and Chief Financial Officer |
Summary |
The report provides Audit Committee with the outcome of negotiations with Mercer (Canada) Limited with respect to a refund of certain fees paid for actuarial services. |
Background Information |
Report (January 22, 2010) from the Deputy City Manager and Chief Financial Officer, headed "Report on Negotiations with the City's Actuaries" (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-26794.pdf) |
AU15.7 | Information |
Deferred |
|
Ward: All |
2008 Investment and Leasing Policy Compliance |
Committee Decision |
The Audit Committee deferred consideration of the report (January 26, 2010) from the Deputy City Manager and Chief Financial Officer, to its next meeting to be held on May 14, 2010, in order to allow for debate. |
Origin |
(January 26, 2010) Report from the Deputy City Manager and Chief Financial Officer |
Summary |
To respond to the audit opinion and the auditor’s comments contained in the report, "Auditor’s Report on Compliance with Investment Policy 2008" and to comply with the City’s Statement of Lease Financing Policies which requires confirmation that the City’s Agencies, Boards and Commissions have complied with the City’s investment and leasing policies during 2008. |
Background Information |
Report (January 26, 2010) from the Deputy City Manager and Chief Financial Officer, 2008 Investment and Leasing Policy Compliance (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27145.pdf) Attachment 1 - Ernst & Young Auditor's Report on Compliance with Investment Policy (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27146.pdf) Attachment 2 - Ernst & Young Management Letter (September 3, 2009) (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27147.pdf) |
AU15.8 | ACTION |
Adopted |
|
Ward: All |
Business Improvement Areas (BIAs) - 2008 Audited Financial Statements - Report No. 2 |
Committee Recommendations |
The Audit Committee recommends that:
1. City Council approve the 2008 audited financial statements and management letters of the eight Business Improvement Areas attached as Appendices A-1 to M-1 to the report (January 22, 2010) from the Treasurer and the Director, Business Services, Economic Development and Culture. |
Origin |
(January 22, 2010) Report from the Treasurer and the Director, Business Services, Economic Development and Culture |
Summary |
The purpose of this report is to present the 2008 audited financial statements and management letters of eight Business Improvement Area’s (BIAs) financial statements to Audit Committee and City Council for approval. |
Background Information |
Report (January 22, 2010) from the Treasurer and the Director, Business Services, Economic Development and Culture, headed "2008 Audited Financial Statements of Business Improvement Areas (BIAs) - Report No. 2" (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27047.pdf) Appendix A-1 - Hillcrest Village BIA - 2008 Financial Statements (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27074.pdf) Appendix B-1 - Little Portugal BIA - 2008 Financial Statements (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27075.pdf) Appendix C-1 - Long Branch BIA - 2008 Financial Statements (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27081.pdf) Appendix D-1 Mirvish Village - BIA 2008 Financial Statements (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27082.pdf) Appendix E-1 - The Danforth BIA - 2008 Financial Statements (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27083.pdf) Appendix F-1 - Toronto Entertainment District BIA - 2008 Financial Statements (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27084.pdf) Appendix G-1 - Trinity Bellwoods BIA - 2008 Financial Statements (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27085.pdf) Appendix G-2 - Trinity Bellwoods BIA - Management Letter (November 9, 2009) (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27086.pdf) Appendix H-1 - Dundas West BIA - 2008 Financial Statements (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27087.pdf) Appendix I-1 - Dundas West BIA - Management Letter (December 9, 2009) (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27088.pdf) Appendix J-1 - Management Letter for Hillcrest Village, Little Portugal and Mirvish Village BIAs (October 28, 2009) (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27089.pdf) Appendix K-1 - The Danforth BIA - Management Letter (November 30, 2009) (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27090.pdf) Appendix L-1 - Long Branch BIA - Management Letter (March 26, 2009) (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27091.pdf) Appendix M-1 - Toronto Entertainment District BIA - Management Letter (February 19, 2009) (http://www.toronto.ca/legdocs/mmis/2010/au/bgrd/backgroundfile-27092.pdf) |
Meeting Sessions |
Session Date | Session Type | Start Time | End Time | Public or Closed Session |
2010-02-12 | Morning | 9:35 AM | 10:41 AM | Public |
2010-02-12 | Morning | 10:50 AM | 11:30 AM | Closed |
2010-02-12 | Morning | 11:33 AM | 12:15 PM | Public |
Attendance | ||
Members were present for some or all of the time period indicated. |
Date and Time | Quorum | Members |
2010-02-12 9:35 AM - 10:41 AM (Public Session) |
Present |
Present: Del Grande, Ford, Lee (Chair), Parker, Perruzza Not Present: Holyday |
2010-02-12 10:50 AM - 11:30 AM (Closed Session) |
Present |
Present: Del Grande, Ford, Lee (Chair), Parker, Perruzza Not Present: Holyday |
2010-02-12 11:33 AM - 12:15 PM (Public Session) |
Present |
Present: Del Grande, Lee (Chair), Parker, Perruzza Not Present: Ford, Holyday |