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HomeMy WebLinkAbout5252 ORDINANCE NO. 5252 AN ORDINANCE of the City Council of the City of Bremerton, Washington, amending Chapter 2.18 of the Bremerton Municipal Code entitled "Audit Committee and City Auditor." WHEREAS, the City Council desires to update provisions of Chapter 2.18 of the Bremerton Municipal Code relating to the Audit Committee; NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON, DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1. Chapter 2.18 of the Bremerton Municipal Code entitled "Audit Committee and City Auditor" is hereby amended to read as follows: Chapter 2.1.8 AUDIT COMMITTEE AND CITY 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. "Internal Auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by bringing a systematic disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes" as defined by the institute Institute of Internal Auditors. To this end, the Committee will: (a) Conduct annual appraisals of the City Auditor's performance as to effectiveness and efficiency; including a comparison of planned and actual audits; (b) Review and approve the internal audit work schedule and planned budget for the coming year; (c) Review results of external and internal audits, prior to release of internal audit reports, with specific attention to: (1) Restrictions; (2) Cooperation received; (3) Audit findings; (4) Audit recommendations; (d) Review and approve appropriate special audit requests; (e) Review and recommend revisions to policies relating to unethical and illegal procedures; (f) Ensure the City Auditor's independence of management; (g) Meet regularly with the City Auditor; I Audit Committee and City Auditor (h) Help to assure that management is exercising due professional care. 2.18.015 SCOPE OF WORK. The three (3) fundamental characteristics of internal auditing function include (1) risk assessment and control, (2) operations: effectiveness, efficiency, and improvement, and (3) compliance with laws regulations, and contracts. The scope of internal auditing will include but not be limited to: (a) Assurance Services - traditional audits, investigations and testing, performance evaluation, limited assurance. (b) Consulting and operations improvement services - Business process reviews, internal control education and other training as requested and approved by Audit Committee, and self - assessments reviews. (c) Ethics Compliance reviews per Chapter 2.96 BMC and compliance with all applicable Federal, State and local laws and regulations. (d) Serve as a liaison between external auditors to assure audit coordination. 2.18.020 MEMBERSHIP. (a) There shall be an Auditing-Committee consisting of two (2) Council members and an independent Certified Public Accountant to be designated by the Ci1Y Council, and two (2) Bremerton residents selected by the designated members of the Audit Committee. The City Council may designate, te one (1) alternate member to serve in the absence of either or both of the appointed Council Members. The designation of the Council Members to the Audit Committee, including the alternate member, shall be by the Council President. The designation of the Certified Public Accountant to the Audit Committee shall be by vote of the City Council. (b) The Audit Committee shall appoint the City Auditor to serve at the pleasure of the Audit Committee. The City Auditor shall only be removed by the majority vote of the entire membership of the Committee sitting as a whole. (c) In order to foster continuity, during the first meeting in January, the Committee shall elect one (1) of its members as Chairperson and one (1) as Vice Chairperson to serve a term of one (1) year. The Chairperson, or in his or her absence the Vice Chairperson, will conduct the order of business at meetings, coordinate communications of the committee, approve the Auditor's payroll and expenses, and perform all other duties as specified by the Committee. 2.18.030 TERM. Audit Committee members shall serve terms as follows: (a) The two (2) Bremerton residents selected by the other members of the Audit Committee shall serve three (3) year staggered terms. The first two (2) appeintments shall made as follows: one (1) euffeady Sitting Fesident (Citizen Position #1) shall expir-e on Deeembe 31, 2000; and the seeend euffeady SiAifig Fesident (Citizen Pesifien #2) shall expire neeemb 31 2001 At th o +:,,., o d „f eac tefm a re sident a shall r-y Residents may be appointed to an unlimited number of terms. (b) The Council members appeinted- by the CLty shall serve for a term up to the unexpired term of their current elected office, and may be re- appointed during successive terms of elected office. 2 Audit Committee and City Auditor (c) The independent Certified Public Accountant selected by jhLCit Council shall serve a three (3) year term, , and may be re- appointed for an unlimited number of terms. The City 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 AND CONFLICT OF INTEREST. (a) Decisions of the Committee shall be by majority vote of the members in attendance except that if a tie vote occurs the City Auditor may cast a tie - breaking vote. A Committee member may abstain from participating and voting at will or may be requested by Committee consensus to abstain from participating and voting on issues that are sensitive subject to that member's area of control or influence. _(b) When a depwtnient whieh is dir-eetly represented by an Audit Ceffifflittee me is the subj eet ef a paAieular audit, that member- ef the Gemmiaee will be exeladed pai4ieipating in that peftien ef the Audit Committee agenda affeeting that depaAffient and will also be prohibited ftem being present dwing any Audit Cemmiaee diseussion of that audit, (eb) There shall be no voting by proxy except that any member who will be absent may prepare a written statement of position to the Chairperson 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 date, time and place as established by the Committee Fne a the s Thursday e f earah fa Audit r,,..,. me s�„�� seheduled Fneeting falls on a holiday, the Audit Cefwaittee shall meet en the third Thursday 0 the menth. By maj ority vote, md upon netiee te the publie, a diff-eFent time of: date or- plaee of a regularly seheduled meeting may be designated by the Committee. 2.18.060 REPORTING. The Audit Committee shall issue periodic reports to the City Council and Mayor and will advise City Council and Mayor 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 Chapter 42.17 RCW (Public Disclosure Laws). (b) The Committee shall present to the CLty_Council and the Mayor, on a yearly basis, the City Auditor's summary of audits performed, reported upon, and responded to by management. The City Auditor shall report administratively and functionally to the Audit Committee. In carrying out duties and responsibilities, the City Auditor shall have full, free and unrestricted access to all City activities, records, property and personnel. The City Auditor will advise the Audit Committee, at regular meetings and upon request, of the audit work anticipated, scheduled and/or performed. To this end: 3 Audit Committee and City Auditor (a) The City Auditor shall prepare projected schedules for each quarter with the proposed objective and scope of audit work for each audit, for Committee review and approval. (b) The City Auditor may discuss audit objectives with the Audit Committee and relevant management before the start date of an audit and as needed. (c) The City Auditor may discuss audit findings with the appropriate management during the course of an audit and with the Committee as deemed necessary. However, the Audit Committee reserves the privilege of reviewing draft reports before such reports are issued and routed; provided, that the review privilege shall not exceed five days from report completion. (d) A final draft of each audit report will be forwarded to the director or elected official of that department for review and comment before it is released. A copy will also be provided to the Mayor. The department must respond in writing specifying either agreement with the audit findings and recommendations or reasons for disagreement with findings and/or recommendations, plans for implementing solutions to identified problems and a timetable to complete such activities. The response must be forwarded to the Auditor within twenty (20) working days unless an extension is granted by the Auditor. The Auditor will include the full text of the department and director /elected official's response in the report. (e) A copy of each final report will be provided to the Mayor, City Council, Director of Financial Services, responsible department head, and others as directed by the Audit Committee. . (f) Upon official submittal to the City Council and Mayor the report and response will no longer be exempt from public disclosure. (g) The City Auditor will ensure adequate and appropriate responses to audit findings through periodic follow -up reports to the City Council. 2.18.070 CONFIDENTIALITY. All employees and the auditee involved in an investigation by the City 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 will be maintained for any communication between the City 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 City Auditor is to retain all confidences obtained from managers during performance of an audit. The City 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. The Audit Committee may request the removal of a member by majority vote of the entire membership of the Committee sitting as a whole, to the appointing authority of that member. 4 Audit Committee and City Auditor i 2.18.090 PROCEDURES. The Audit Committee and the City 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 e the- piabli� may be approved upon a majority vote of the Audit Committee. Copies shal maintained in the City Couneil Offic-e— SECTION 2. Severability. If any one or more sections, subsections, or sentences of this Ordinance are held to be unconstitutional or invalid, such decision shall not affect the validity of the remaining portion of this Ordinance and the same shall remain in full force and effect. SECTION 3. Effective Date. This ordinance shall take effect and be in force ten (10) days from and after its passage, approval and publication as provided by law. PASSED by the City Council the day of v ' 2014 GREG LER, Council President Approved this l day of _,TZC 2014 PATTY L , Mayor ATTEST: APPROVED AS TO FORM: SHANNON CORIN, City Clerk IR GER � AL U B O i y ttorney PUBLISHED the day of 9 2014 EFFECTIVE the At - day of , 2014 ORDINANCE NO. R: \Legal \Legal \Ordinances \City Council \Chapter 2.18 Audit Committee and City Auditor.docx 5 Audit Committee and City Auditor AFFIDAVIT OF PUBLICATION Account #42742 AD #20142139 STATE OF WASHINGTON COUNTY OF KITSAP I, Teresa Hull, being first duly sworn on oath, deposes and says: That she is now, and at all times embraced in the publication herein mentioned was the principal clerk of the printers and publishers of KITSAP SUN; that said newspaper has been approved as a legal newspaper by order of the Superior Court of the County of Kitsap, in which County it is published and is now and has been for more than six months prior to the date of the publication hereinafter referred to, published in the English language continually as a daily newspaper in Bremerton, Kitsap County, Washington, a weekly newspaper in Kitsap County, Washington and is now and during all of said time, was printed in an office maintained in the aforesaid place of publication of said newspaper; that the following is a true text of an advertisement as it was published in regular issues (and not in supplement form) of said newspaper on the following date, to wit: And on July 21, 2014 such newspaper was regularly distributed to its subscribers during all of said period. The full amount of the fee charged for the foregoing publication is the sum of $33.89. This amount has not been paid in full. (Signature of Principal Clerk) i NOTARY PUBLIC Subscribed and sworn to before me this day of July 25, 2014. STATE OF WASHINGTON CHRISTY M MOFFITT My Appointment Expires July 08, 2016 ORDINANCE NO. 5252 AN ORDINANCE of the City Council of the City of Bremerton, Washington, amending Chapter 2.18 of the Bremerton Municipal Code enittled "Audit Committee and City Auditor." PASSED by the City Council on the 16th day of July, 2014. The full text of this ordinance is available from the City Clerk's Office, 345 Sixth Street, Suite 600, Bremerton, WA 98337. JULY 21, 2014 AD #20142139