HomeMy WebLinkAbout4681 AN ORDINANCE creating a new Chapter 2.18 Audit
Committee and Internal Auditor as created in the City of
Bremerton Charter, Section 18, and further providing for
procedures, duties and operations of the Audit Committee
and Internal Auditor.
THE CITY OF BREMERTON DOES HEREBY ORDAIN:
Section 1. New Chapter. A new chapter is hereby added to the Bremerton Municipal
Code to read as follows:
CHAPTER 2.18 AUDIT COMMITTEE AND INTERNAL AUDITOR
2.18.010 PURPOSE.
The purpose of the Audit Committee, as provided in the Charter of the City of
Bremerton, Article III, Section 18, shall be to assure elected City officials and
management that the internal auditing of the municipality and its departments, programs
and activities is performed in accordance with standards for the practice of internal
auditing and with professional standards of conduct. To this end, the Committee will:
(a) Conduct annual appraisals of the Internal Auditor's performance as to
effectiveness and efficiency;
(b) Review and approve the internal audit work schedule and planned
budget for the coming year;
(c) Review results of external and internal audits with specific attention to:
(1) restrictions
(2) cooperation received
(3) audit findings
(4) audit recommendations
(d) Review the City audit activities of the past year, comparing planned
and actual audits;
(e) Review and approve special audit requests;
(f) Review internal audit reports prior to report release;
(g) Review policies on unethical and illegal procedures;
(h) Help to keep the internal auditor independent of management;
(i) Meet regularly with the internal auditor;
(j) Help to assure that management is exercising due professional care.
2.18.020 MEMBERSHIP.
There shall be an Auditing Committee consisting of two Council members and an
independent Certified Public Accountant to be designated by Council, and two
Bremerton residents selected by the designated members of the Audit Committee. The
City Council may designate by majority vote one alternate member to serve in the
absence of either or both of the appointed Council Members.
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12/9/99
In order to foster continuity, the Committee shall elect one of the elected Council
members as Chairman. The Chairman will conduct the order of business at meetings,
coordinate communications of the committee, and perform other duties as specified by
the Committee.
2.18.030 TERM.
Audit Committee members shall serve terms as follows:
(a) The two Bremerton residents selected by the other members of the
Audit Committee shall serve three (3) year terms. The first two
appointments, shall be made as follows: one currently sitting resident
(Citizen Position #1) shall expire on December 31, 2000; and the second
currently sitting resident (Citizen Position #2) shall expire on December
31, 2001. At the expiration anniversary date of each term, a resident
appointee shall be appointed for a three (3) year term thereafter.
Residents may be appointed to an unlimited number of terms.
(b) The Council members appointed by the Council shall serve for a term
up to the unexpired term of their elected office.
(c) The independent Certified Public Accountant selected by Council shall
serve a three (3) year term, shall expire on December 31, 2002, and may
be appointed for an unlimited number of terms.
The Internal Auditor shall be a permanent ex-officio member of the Audit
Committee.
In the event that any member does not serve a full term, either by resignation or
removal, a replacement shall be selected by the original appointing authority to serve
the remainder of the term.
2.18.040 VOTING & CONFLICT OF INTEREST.
Decisions of the Committee shall be by majority vote of the members in
attendance except that if a tie vote occurs the Internal Auditor may cast a tie-breaking
vote. A Committee member may abstain from voting at will or may be requested by
Committee consensus to abstain from voting on issues that are sensitive to that
member's area of control or influence.
When a department which is directly represented by an Audit Committee
member is the subject of a particular audit, that member of the Committee will be
excluded from participating in that portion of the Audit Committee agenda and will also
be prohibited from being present during any Audit Committee discussion of that audit,
whether it concerns the interim report, scope or final release of a report.
There shall be no voting by proxy except that any member who will be absent
may prepare a written statement of position to the Chairman in advance of any meeting
to be read to the members present during that meeting.
2.18.050 MEETINGS.
The Audit Committee shall meet on the second Thursday of each month. Audit
Committee meetings shall commence at 4:00 p.m. in the City Council Conference
Room. In the event the regularly scheduled meeting falls on a holiday, the Audit
Committee shall meet on the third Thursday of the month.
Audit Cmmnittee & Internal Auditor. Ord
12/9/99
2.18.060 REPORTING.
The Audit Committee shall issue periodic reports to the City Council and City
Administration and will advise these parties at any time and on any issue that the
Committee deems essential for the effective performance of duties and decisions by
them, provided that:
(a) The Committee and the parties will comply with Titles 42.17 (Public
Disclosure Laws) and 42.30 RCW (Open Meetings Act).
(b) The Committee shall present to the Council and the City Mayor, on a
yearly basis, the Internal Auditor's summary of audits performed, reported
upon, and responded to by management.
The Internal Auditor shall report administratively and functionally to the Audit
Committee. In carrying out duties and responsibilities, the Internal Auditor shall have
full, free and unrestricted access to all City activities, records, property and personnel.
The Internal Auditor will advise the Audit Committee, at regular meetings and
upon request, of the audit work anticipated, scheduled and/or performed. To this end:
(a) The Internal Auditor shall prepare projected schedules for each quarter
with the underlying, proposed objective statement and scope of audit work
for each audit, for Committee review and approval.
(b) The Internal Auditor may discuss audit objectives with the Audit
Committee and relevant management before the start date of an audit and
as needed.
(c) The Internal Auditor may discuss audit findings with the appropriate
management during the course of an audit and with the Committee as
deemed necessary, however, Audit Committee reserves the privilege of
reviewing written reports to the auditees before such reports are issued
and routed: provided, that the review privilege shall not exceed five (5)
days from report completion. Distribution will then be to the Mayor, City
Council, Treasurer and responsible department head, and to others as
directed by the Audit Committee. A public copy will be maintained in the
City Council Office.
(d) All responses to audit reports shall be to the Internal Auditor in writing
and within twenty (20) working days. Both the report and response shall
be submitted to the Council through the Audit Committee in a timely
manner.
(e) Upon official submittal to the Council, the report and response will
no longer be exempt from public disclosure.
(f) The Internal Auditor will ensure adequate and appropriate auditee
response to audit findings through follow-up and will update summaries
accordingly.
2.18.070 CONFIDENTIALITY.
All employees and the auditee involved in an investigation by the Internal Auditor
are subject to strict confidentiality.
In order to protect the integrity of the Internal Audit function, members of the
Audit Committee will be held to a strict standard of confidentiality. Strict confidentiality
Audit Committee & Internal Auditor. Ord
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will be maintained for any communication between the Internal Auditor and Committee
members or between individual Committee members, regardless of whether the
communication is generated during an Audit Committee meeting.
It is further understood that the Internal Auditor is to retain all confidences
obtained from managers during performance of an audit. The Internal Auditor will
communicate confidences obtained during an audit at the time a report is presented to
the Audit Committee if such information is significant to the report conclusions and
findings, or if it is relevant and necessary to a request of the Committee to change the
scope of an audit or to discontinue a particular audit.
Confidences, which relate to illegal activities, shall be immediately communicated
to the City Attorney and/or State Auditor.
2.18.080 REMOVAL.
Any member of the Audit Committee may be removed for just cause upon a
majority vote of the entire membership sitting as a whole.
2.18.090 PROCEDURES.
The Audit Committee and the Internal Auditor may adopt such policies,
procedures, and directives as are necessary to fulfill the purposes of their functions.
Proposed policies, procedures and directives shall be presented to the Audit Committee
during a meeting open to the public, and may be approved upon a majority vote of the
Audit Committee. Copies shall be maintained in the City Council Office.
Section 2. Effective Date. This Ordinance shall take effect ten (10) days after
passage and publication.
APPROVED by the City Council of the City of Bremerton this ~ day of ~
..~..t.~.~.~ 1999.
PASSED by the City Council of the City of Bremerton this /~ day of ~
,~.,&:~,~ 1999.
/
MIllE SH-EPHI~RD, Council President
~_..O~., o
APPROVED this ~ day of ,1'eJ99.
LYNN S. I-IORTON, Mayor
ATTEST:
~ 1/~'L4.. ~E EFFECTIVE DATE
KATHLEEN Y, City Clerk F!J LICAT[0F1 "" '""*~'
ORDINANCE NUtV L EF
Audit Core. Bee ~ Internal Audilor. Ord
12/9/99