Carson City Audit Committee Meeting - February 18, 2026
Carson City Audit Committee Meeting - February 18, 2026
The Carson City Audit Committee met on February 18, 2026, at 9:30 AM. Chair Shuddy presided, with Vice Chair Lambin, Member Duke, Member Scalia, and Member Stack present. The meeting covered approval of prior minutes, a report on the FY26 asset management review, closure of previous audit findings, an update on the FY26 audit work program and fraud hotline activity, and scheduling of future meetings.
Consent Calendar
- Approval of Minutes: The committee approved the minutes from the last meeting unanimously (motion by Member Duke, second by Member Scalia).
Public Comments & Testimony
- No public comments were offered during either public comment period.
Discussion Items
- Item 5A: Asset Management Review Report: Audrey Donovan and Christine Homack of Id Bailey, LLP presented the FY26 audit work program report on asset management. Objectives included evaluating effectiveness of asset management practices for city-owned assets (acquisition, maintenance, disposal) from July 1, 2024 to June 30, 2025. The audit found one finding: the city's disposals were not presented to the Board of Supervisors as required by policy. One observation was also noted. City staff (Sherry) took responsibility for not updating the policy, noting that disposals would be presented at the next Board meeting in April for better alignment with capital improvement planning. The committee accepted the report unanimously.
- Item 5B: Closure of Previous Audit Findings: Sherry recommended closing three findings from the community development internal audit: (1) Energov client portal went live January 2026, (2) building division brought in-house using hybrid approach, (3) contract termination with Charles Abbott on February 13, 2026. An update on finding #1 regarding payroll was deferred to April 30, 2026, due to budget work. The committee voted unanimously to recommend closure to the Board of Supervisors.
- Item 5C: FY26 Audit Work Program Update and Fraud Hotline Activity: Audrey Donovan reported that three audits were planned: capital asset accounting (completed and delivered), credit card payment security and compliance (delivered at prior meeting), and public guardian asset management (kicked off). The annual risk assessment update began with director interviews. One fraud, waste, and abuse hotline case was received (hostile work environment complaint at public works front office); Sherry noted the matter was reportedly resolved. The team is on track and on budget (not to exceed $110,000).
- Item 5D: Next Meeting Dates: The committee scheduled two meetings: May 12, 2026 at 1:30 PM (for risk assessment update and proposed audit plan) and June 9, 2026 at 1:30 PM (for public guardian report and full risk assessment report).
Key Outcomes
- Approval of Minutes: Approved unanimously.
- Acceptance of Asset Management Report: Motion to accept the report passed unanimously.
- Closure of Audit Findings: Motion to recommend closure of three community development findings passed unanimously.
- Deferral of Payroll Finding: Closure deferred to April 30, 2026.
- Meeting Dates Set: May 12, 2026 and June 9, 2026, both at 1:30 PM.
Meeting Transcript
Hello, everyone. I would like to call the audit committee meeting to order. Um, can I have a roll call, please? Chair Shuddy. Here. Vice Chair Lambin. Member Duke. Here. Member Scalia. Here. Member Stack. We have Corman. Awesome. Thank you. Uh, next on the agenda, public comments and discussion. The public is invited at this time to provide comment on any topic that relates to a matter over which this public body has supervision, control, jurisdiction, or advisory power, including any such matter that is not specifically included on the agenda at as an action item. And no action may be taken on a matter raised during this period for public comment. Thanks for being here, Sherry. Um, so is there any public comment? All right. And as a reminder, as long as you've read the minutes, you can vote. You don't have to abstain if you were absent as long as you read the minutes. I would move that we approve the minutes from last meeting. And second and second. All in favor. Aye. Aye. Anyone opposed? Okay. The motion passes unanimously. Next meeting item 5A for possible action discussion and possible action regarding a report prepared by the Carson City Internal Auditor Id Bailey, LLP for the fiscal year 2026 audit work program concerning the Carson City Asset Management Review, including findings and recommendations. Sherry, take it away. Thank you. I am going to pass this to Audrey Donovan, the manager on the engagement. She may pass it off to the person who did the engagement, but we'll see what happens. Hi, thank you. Thank you, Audit Committee. Hi, hi, audit committee chair and audit committee members. It's a pleasure to be here with you again today. We do have an audit to read out to you today. The asset management review is noted. And this was approved on the fiscal year 26 audit plan. And mainly in part because of inherent risk that relate to the capital asset accounting, such as ineffective internal controls that could occur that may cause failure or prevent errors from being identified. There could be misclassification of assets. There could be inconsistent application of capitalization thresholds, improper unsupported entries, and potentially delays in capitalizing assets in a timely manner. So the engagement will be read out today by Christine Homack. She's a senior manager with the firm, also part of internal audit. And the team that conducted the engagement is Doug Schleich, manager, and Zach TellingHuson, senior associate. They will not be in attendance today, but Christine's Christine is tapped in. Her video is not working, but she should be able to have audio.
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