Good morning.

I'm gonna call the meeting to order today.

Today is August, I'm sorry, October sixth, two thousand twenty-five, and the audit oversight committee meeting is called to order.

Will the city clerk call the roll, please?

Chair Price.

Present.

Member Kircher.

Excused.

Member Bruni.

Excused.

Member Booker.

Present.

Member Kelly.

Here.

Thank you, Chair.

You have a quorum.

Thank you.

And I would just like to start real quick by welcoming uh Councilwoman Kelly here to the audit committee.

And congratulations on that.

We look forward to having you here.

Thank you very much.

Agenda item number two, an announcement regarding the compliance with open meeting law.

To the city clerk.

Has this meeting been noticed and posted in compliance with the open meeting law?

Yes, Chair, it has.

Thank you.

We'll be moving to item number three on the agenda.

Agenda item number three is public comment.

Comment during this period of the agenda must be limited to matters on the agenda for action.

If you wish to be heard, come forward and give your name for the record.

The amount of discussion as well as the amount of any single speakers allowed may be limited.

Is there anyone wishing to be heard at this time?

Seeing no one, I'll close the public comment portion and we'll move on to agenda item number four.

Agenda item number four for possible action to approve the final minutes by reference of the regular meeting of July twenty first, two thousand and twenty-five.

I move for approval.

There is a motion.

All in favor.

Yes.

Should I be abstaining since I wasn't present at that meeting?

That's a good question.

This is uh Nicole Garcia from the city attorney's office.

You can still vote on the minutes.

Thank you.

Aye.

Aye as well.

Uh there's a mo all in favor.

Any opposed?

Uh please post, please.

And the motion carries.

Moving on to agenda item number five.

Discussion for possible action regarding oversight committee quarterly meeting dates for the calendar year two thousand and twenty-six.

Following dates have been proposed for holding the quarterly audit oversight committee meetings in two thousand and twenty-six.

They are January twelfth, April 20th, July 20th, and October twelfth.

All of these meetings will be held at 10 AM.

Do I have a motion to accept these dates and time?

I'll move to accept the proposed dates and times.

There is a motion.

All in favor.

Aye.

Aye.

Aye.

Please post.

And the motion carries.

Moving on to agenda item number six.

Agenda item number six.

Report by staff and discussion for possible action regarding an update on audit issued audit recommendations.

Brian Smith, City Auditor will begin this report.

Please go ahead, Mr.

Smith.

Thank you, Chair Price.

Brian Smith, City Auditor.

I'd like to also extend a welcome to Councilwoman Kelly.

Appreciate her service on this committee and look forward to working with her.

Thank you.

Um twice a year, we have the opportunity to brief the audit committee on the status of previously issued audit recommendations.

And we'd like to do that today.

Prior to the finalization of every audit report, city management requests that management provide us with their management action plan and an estimated data completion for every audit recommendation.

We place these management responses at the back of every audit report.

Upon release of an audit report, each audit recommendation is classified as not due.

Once an audit recommendation's estimated data completion passes, and the recommendation has not yet been verified as being complete by an auditor, the classification of the recommendation is then changed to incomplete.

When a department alerts our office, they believe they have fully addressed an audit recommendation and are ready for us to review their work.

The recommendation is then identified as verification in process.

Once an audit recommendation has been verified by an auditor as having been addressed, the recommendation classification is then changed to complete.

Over the past three calendar years, our office has issued a total of 84 audit recommendations to departments to improve their internal controls, their policies and procedures, and also improve efficiencies within their departments.

As you can see from this table, the departments have successfully responded to our recommendations and completed 76 of these 84 audit recommendations as of today.

No recommendations are in complete.

Seven recommendations are classified as not due as the date that was provided to us by management has not yet passed.

And then we have one recommendation that is currently being verified by our office.

The one recommendation that is in process of being verified is with the finance department.

Our payment collections audits in 2023 identified the need for finance to clarify some cash handling procedures within the citywide cash handling policy.

At the time of our audit, finance acknowledged that the entire cash handling policy needed updating and chose to proceed with doing so.

As of today, they have updated the policy, and they're just waiting for final approval by the city unions for uh finalization of this policy.

The new policy will now be known as the payment collection policy.

Um we will end up closing out this recommendation once the policy and procedure has been approved.

We uh applaud the efforts of the finance department in addressing our recommendations and especially for going above and beyond in updating this citywide policy and procedure.

Um certainly makes life easier on us as auditors as we audit to those uh policies and procedures.

So we commend them on their efforts.

Um Cory DeMille, our city treasurer, is in attendance if you have any questions about this policy.

Is there any questions from anyone?

Ms.

Ken.

Councilwoman.

Thank you.

Since I'm the new person, I've got a question that uh is relatively simple, I'm sure, to answer.

The the two recommendations that are completed, the one verification and process is the one verification and process in process because it is yet to be approved by the unions.

Yes.

So then it would once approved by the unions, it would become three recommendations.

Then we will, I'm sorry, Brian Smith City Auditor.

Once that policy is approved, we decided we've put it in this category of verification and process since it it really is going to be it's gonna be approved probably within the next slide.

The process hasn't completed, but then it would become added to three.

Okay, and the whole thing would be complete.

Exactly.

And then in terms of just timing, so this was this was from the audit that was conducted in 2023.

So we're in 2025.

Help me understand the timing of how these things take place.

Yes, thank you.

Great question.

Brian Smith City Auditor.

So back in 2023, we actually did multiple audits of well, audits of various locations where payments are collected.

It included several community centers, a cultural center, also Floyd Lamb Park.

And as we were doing these audits, we we identified just some challenges in trying to understand what the policy was saying and the direction that it was being provided to the departments.

And so we issued multiple, even though these audits were focused on parks and rec' operations at these community centers and the cultural centers, we issued recommendations to the finance department asking them to clarify some of the procedures within the citywide cash handling procedure.

So to their credit, it does take a lot to update these policies, especially this one.

I believe the policy is over, I I think it's over 15 pages long, something to that extent.

Um and also there's a formal approval process that has to be followed in the city for adopting any policy.

So they they took it upon themselves to update the entire policy, and also they gave us the opportunity to give our feedback on the policy.

And so there was back and forth, and um, and thankfully we finally have uh a policy that's ready to be approved.

Mr.

Chairman, may I um and once so once it's complete, what sort of training then do we do?

Uh 15 pages seems like a lot for a policy, and I'm sure it's 15 pages because it needs to be.

But how do we then go out and train our our employees to make sure that uh they're fully educated on the process so that they know what they should or should not be doing Brian Smith City Auditor, another great question.

I'd like to turn it over to finance if you don't mind, and have a representative talk about their plans to educate the city staff on this new policy.

Uh hello, Corey DeMill, Treasury Section Manager.

Uh to address your question, I plan on once it is complete, I will go out and meet with all departments one-on-one.

I tend not to do a whole um group meeting because I think it would be better to meet one-on-one.

So I plan on going out there comparing the old one to the new one to show what's changed, so what they can expect.

And uh from there, we'll go over the there's a new part of the policy that it that addresses this finding.

Uh it's a basically a checklist for the departments to show that they understand the internal controls that we've placed, and uh as documentation, they will complete a checklist to uh confirm that.

So thank you very much.

Thank you.

Thank you.

Brian Chair Price, yeah.

Brian Smith City Auditor, just a final comment on that.

Um, as uh as Corey mentioned, um, I think that is a great way to approach training these departments because the cash handling in each department is somewhat unique.

The policy that they've created is this umbrella policy giving you know the minimal standards that are required for cash handling of the city, but there are differences inevitably cash being collected at the municipal court versus at a community center, and so I uh I commend Corey for this approach.

Thank you.

Yeah, we I just want to make sure if we're holding people accountable as we're changing things, that they're properly trained and informed on how they're held accountable, how that be changed.

So thank you.

All right, uh Brian Smith City Auditor.

I have now I asked each of our auditors to provide you with a brief summary of some of the recent accomplishments of the departments in addressing our audit recommendations over the last couple years.

Louis Alaud, our IT auditor will be the first presenter.

Good morning, Louis Hillad senior IT auditor.

Uh so last summer, as exactly one of you will remember, uh, we completed an audit of uh the IT department and issued seven recommendations uh regarding the inventory and tracking of important hardware assets.

Um in response to these recommendations, the IT department has completed all seven, um, including the following improvements.

Hardware assets that require a higher level of inventory tracking, um, such as servers, computers, or our sensitive assets.

Um, they're clearly labeled now inside of the hardware register that IT maintains, uh, indicating whether each device is either a fixed asset, meaning that it was capitalized at the time of purchase, a sensitive item, meaning it carries some inherent risk of uh theft or compromise, um, or other, meaning it's not a fixed asset or a sensitive item.

IT management has laid out a clear definition of what they constitute what they consider a sensitive item, uh, putting that definition in writing saying what properties might make something be considered a sensitive item by the department.

All inventory control processes have been clearly documented in the form of a guidebook for new and existing employees, and all of their processes are clearly clearly laid out in that guidebook.

Um, the new guidelines have been put into practice.

IT has completed a full inventory of all capitalized or sensitive hardware assets across the city.

Uh, so everything is in its place, and we know where it is.

IT has also overhauled its reconciliation process with the finance department, um, ensuring that the two departments are in regular communication about the status of the capitalized assets.

Each department has uh a separate register of capitalized devices and capitalized assets, and so they are making sure they stay in lockstep between those two uh uh lists.

And finally, IT has provided a full and accurate update of all of the capitalized assets to the Finance Department as we requested for them to do.

Um said, this completes all of the recommendations for that report.

Uh, we're appreciative of the efforts from both departments, IT and finance.

Um, they did a great job uh responding to these recommendations, and uh better records and more complete processes help us to protect our important hardware assets across the city.

Um that is it for that report.

And next up is uh James Burnett, our senior auditor.

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Should we proceed on agenda item number six, continue on agenda item number six?

James Burnett, senior auditor is going to talk about economic and urban development department, I believe.

Thank you.

Good morning.

My name is James Burnett.

I'm senior internal auditor.

I'm pleased to report that parking services has fully implemented the 14 recommendations from our March 2024 audits.

Uh by implementing the rec park the audit recommendations, parking services has improved management oversight of cash collections by creating procedures for periodic periodic audits, improved physical security by improving management oversight over count room access, as well as implementing procedures designed to improve controls over keys for the safety deposit boxes in which the change funds are stored, improved management oversight over system permissions to reduce the risk of inappropriate access and improve identification of transactions should an issue arise and improved management's ability to identify and detect errors and potential misappropriation of parking fees through improved tracking and management review of discrepancies.

Our office appreciates parking services efforts in addressing our recommendations, and I will now discuss the recommendations from our business licensing compliance audit.

By implementing the audit recommendations, community development, improved management oversight by developing performance metrics and reports that better reflect the work that is being performed by their license officers, improved coordination with fire prevention to license four-plex apartment homes, and as of August 28th, 2025, community development has reported that they have successfully licensed 88% of the identified four-plex homes.

They've improved communication with citizens by updating guid by updating guidance provided to four-plex applicants, documenting the inspection process for getting licensed.

And they've also improved oversight of system access changes.

As of today, there are four outstanding recommendations, which are currently not due.

Uh we appreciate community development's efforts in addressing our recommendations.

Uh Nancy Cardoso, senior auditor is up next.

Mr.

Chairman, yes, questions.

Any questions, please?

Please.

When and I'm not sure maybe if I to whom I direct this, Mr.

Smith, but when you're doing the business licensing audit, um is there any portion of that audit that looks to see how we're serving the customers?

Or maybe in this one it happened to be just compliance from behind the scenes.

Uh uh excellent question.

Uh we our audit uh worked uh with the business licensing compliance officers to uh look at their day-to-day operations.

And one thing we found, and we just we discussed with officers what things they could be be done to make their jobs easier, what are their challenges, and we worked on creating an audit program that addressed that worked on confirming and then addressing those uh deficiencies that they noted.

Uh ultimately the goal is to better serve the the customers and if they don't uh the constituents, the citizens, and um so hopefully that answers your question.

It tells me what you're doing, which I appreciate.

That helps me understand that.

Um and maybe the question is this isn't the appropriate venue for it, but one of the you know we are uh we are a government that is closest to the people, and so we're at wherever we do.

So in this particular instance, I see our role as someone who's representing the business community for so long is being welcoming to business.

The fact that you want to invest your your capital and resources, we want to get you up and going as quickly as possible.

So you can do what you do best, which is business purses and expand jobs and um improve the local economy.

When we interact with people, there you know, person A could be much more welcoming, much more easier to much easier to interact with, still doing all the compliance things that need to be done for their the procedural part of their job, while employee B may not be as welcoming and is forthcoming and as helpful, and so maybe that is happens more for management oversight than it does necessarily for an audit.

So my question was is the interaction with our customers, and maybe it's more precisely part of this audit, and then I guess in a broader way, is it part of any audit that you conduct?

Brian Smith City Auditor.

The the scope of this audit that we completed with business licensing was focused on their compliance section.

And as James mentioned, one of our recommendations related to the metrics that the department tracks on the compliance section.

And so some of those metrics are, for example, how quickly do the compliance staff respond to a complaint on a business?

How quickly is that resolved?

And what we did find is there was definitely a need to improve their metrics to provide information to management on their activities.

They had some they had some minimum uh, they had some metrics, but it we didn't feel like it fully addressed their operations.

There was an opportunity to identify, you know, the number of complaints by ward, um, the number of complaints by business type.

Um, and so that was one of our recommendations.

Now, but certainly I I'm understanding on the compliance side.

Right.

Now, so far as did we do a community survey or survey those individuals, that is certainly something the department could do to get feedback from business owners as to how well they were treated by the licensed officers.

Um certainly as auditors, we we could do something like that.

Um I certainly don't want my first day to be offering more work, but um uh I appreciate the clarification.

That's all Mr.

Chairman, thank you.

And uh Brian Smith City Auditor also the uh the city uh does uh is it an annual community survey?

Right.

If I may thank you, Mr.

Chairman.

Yes, we were talking about the last community survey that was done at our special strategic planning meeting last week.

Right.

Um so there could be an opportunity within that community survey to ask about the public's interaction with our idea.

Thank you, Mr.

Smith.

Thank you.

Councilwoman, additional comments.

Thank you, Mr.

Chairman.

I just wanted to I guess congratulate the the business licensing division because you know, these recommendations came out initially in June, and within a few months they've already uh completed a lot of the recommendations, and it's a very small office, and so I really want to just commend them for their um quick action.

There's any additional comments or questions moving forward.

I guess we will uh continue on.

Thank you.

I'm happy to report that YDSI has completed all of the recommendations for my report on the batteries include a youth programs.

As a result of their efforts in response to our audit recommendations, youth travel procedures and documentation have been improved, reducing the risk associated with travel.

Staff are now communicating with the city's risk manager prior to their trips to confirm insurance requirements and safety measures that may be needed.

Software is being implemented to enhance the record keeping and reporting on their programs, and finally, management has begun internally evaluating policy and procedure compliance within their other programs.

Uh Joseph Thromberry, senior forensic auditor is up next.

Good morning, Joe Thromberg, Senior Forensic Auditor.

Our office appreciates the Department of Public Safety's implementation of six recommendations from our September 2024 audit related to the Deputy City Marshals Evidence Unit, as well as the corrections and administrative services inmate commissary contract.

That is with Keith Group.

We should note that during our audit, all items that were contained within the evidence unit did match the description, location, and data that was in the electronic uh case management system, and so they were a hundred percent compliant with uh what we identified as our audit sample.

Specific to DPS's commissary contract with Keefe, an external vendor.

We documented procedures that were related to the um to the purchasing expense monitoring and price reconciliation that the vendor was charging our inmates.

The audit identified areas of opportunity in regards to that contract monitoring and procedures and DPS made those corrections.

Those improvements not only made consistency amongst the staff, but also allowed for training of individuals as well as cross-training members of the department to improve efficiency.

Moving on to fire rescue, uh, fire rescue was an audit that was just completed in June of 2025.

They highlight um fire rescue has completed um three out of the six recommendations as they relate to the controlled substance uh management process uh within the EMS division.

Um the three um accomplishments were they've updated and posted their current operational um policy that also addresses their uh quality assurance program that's now included in the revised policy.

Add uh additionally, um they there's now a process to reconcile um between finances, administrative services, and the the vendors and so Oracle data is matching our DEA 222 forms, as well as the tracking uh of the um the items that were received by fire operations, and so those processes um have now aligned, which uh gives independent um assurance over the controlled substance uh inventory within the city.

We were proud to say that during our audit um we were out in the stations verifying um the control substance logs, and we identified that um all substances, kenamine, fentanyl, and versed that is um purchased by the city was accounted for with uh no items missing.

Um, with that, I will uh turn it over to Brian Smith, City Auditor.

I have one quick question.

Um for the three not do recommendations.

Do you have a sense of when those are due?

Is it first quarter, 2026 or later in the year?

And I'd have the same question for Mr.

Burnett because I noticed there are four not due for the community development department as well.

I I can answer that.

Uh those for fire rescue, the the open items um that um our outstanding involve technology reviews.

So the the case management system for medical incidences, fire incidences, as well as the um administration of control substances is image trend.

And so that um it's been a while since they have evaluated that system to bring up any new functionalities that vendor may have.

The second component, and so that evaluation to assess their current um case management system is going to be due um in in the coming um in the coming year in 2026.

However, the second component of that is looking at automated processes.

Right now, the um the control substance management process is very manual.

It has log books at each fire station.

Um there would be no simple way to get an onhand inventory without actually physically verifying it or calling each station if if um I was the the fire chief and needed to know that information.

Um whereas there are automated case management uh systems that will control it on an automated uh basis that will provide instant um real-time information as to expiration dates, what's received, and can craw potentially cross over to the financial system in Oracle to verify um from a cradle to gray process.

That is going to be looked um looked at um second, and that's good that open uh recommendation exceeds um 2027 due to the potential fiscal cost for the that system.

Very informative, thank you.

Yeah, and just Mr.

Burnett for the the four not due for the community development department uh James Burnett, uh senior internal auditor.

Uh the next uh audits recommendations that are due are in May of uh 2026.

Thank you.

I just have a question.

Joe, you mentioned that as part of the compliance, the Oracle system was aligned with DEA.

Did you say DEA?

The DA 222 form is the order that our medical director um form places to the controlled substance vendor.

We found during the audit that the operational processes that was a hundred percent compliant.

However, due to vendor issues, um the invoice numbers were not matching up within Oracle.

And so there is a process now that um that has addressed that, but there's also automated systems that are out there.

So when the EMS division leadership would need to order controlled substance if it wasn't on automated orders based upon replenishment levels set by the medical director, there could be an automated uh DEA 222 form, which is the ordering form for that, those uh controlled substances, and that could be done automated and potentially um integration to Oracle so it can match up.

Right now it's a manual process.

Any additional questions before we continue on?

All right, continuing on, thank you.

Brian Smith City Auditor.

So that's a summary of the recommendations that have been cleared over the last couple years.

I'd like to thank the city manager's office, the city department directors, as well as their staff for their their help with these audits and their their efforts in addressing the recommendations.

Without their their help, we as auditors we only have so much authority, and they help us make the changes that are needed to improve the city's operations.

So we we appreciate their help.

And that concludes our report.

Thank you, Mr.

Smith.

Uh seeing no more additional questions from the members.

Uh may I have a motion to approve the report.

I move to approve the report as presented.

Thank you.

All in favor?

Aye.

Aye.

No opposed.

Please post, and the motion carries.

Let's move on to item number seven.

Agenda item number seven, report by staff regarding current audits.

Brian Smith, Smitty Auditor, City Auditor will give this report.

Please go ahead, Mr.

Smith.

Thank you, Chair Price.

Brian Smith, City Auditor.

The audits we're currently working on include one in in HR, which involves the employee separation process.

We have a draft report, and we're working through the reporting and review process with that report, and anticipate that will be released within the coming month or so.

Um we also are working on uh an audit of the witness fee fund that is found over in the municipal court.

This is a fund that actually belongs to the city attorney's office, but uh the distribution of the funds are completed by municipal court employees.

And so we're also in the reporting phase of that audit, and once again anticipate that report being issued within the next month or so.

Um we're in the middle of an audit of uh mobile communication devices uh that is managed by our IT department and Louis Lot, our intern our IT auditor is working on that audit, and we're in the field work stage of that audit.

Um also we have some upcoming audits based on the our audit plan that was approved last meeting.

Uh we uh look at doing an audit within purchasing, also within the municipal court and also within public works.

And the scope um the nature and the scope of those audits will be defined in our planning process and also after meeting with the department directors in those areas.

And uh that concludes my report.

Looking for any questions?

Please.

Thank you, Mr.

Chairman.

Mr.

Smith, um, when will you share the scope of the upcoming audits?

Will it be at the next audit committee meeting, or will you do that prior to the next meeting?

Brian Smith City Auditor.

Yes, with our uh planning process, um, there's multiple stages.

Of course, as we approach any audit, we'll meet with the department director to get their input.

Sometimes we find that directors they may have a need where they think that we could provide some some value to their department, and so we welcome that input.

Um, also we do our own risk evaluation of the area.

Of course, the court is a very large organization, so we're gonna have to whittle it down as to exactly what area do we want to focus on.

And uh and so also as a part of our planning process, we reach out to all the council members, letting them know that we and we're planning on doing this audit, and we solicit input from all the the uh council members.

Sometimes we have council members that have specific things they would like us to address as a part of the audit.

And so once again, we welcome that feedback.

Um but uh yes, uh, once we open up the audit, we can we can share that scope with you at the next meeting.

Yeah.

Are there any additional questions?

I have one comment here on agenda item number seven.

It was kind of a carryover from agenda item number six regarding the uh incomplete recommendations uh or the ones that are in process.

I know that in the past, and maybe we save it kind of towards the end of the year, we summarize maybe on one sheet from the different departments all the outstanding.

So there's kind of one place we can look and say, how many are outstanding moving forward, and make sure that those things are getting kind of checked off that list as they kind of accumulate.

So I I think we maybe did that last year, or I don't know if we included in every meeting's quarterly meetings uh handout, but just kind of that running list of what's open, so we can see that they're getting checked off and as new things come on, the other stuff's going off in kind of in one place.

Brian Smith City Auditor, yes, uh Chair Price, we certainly can do that.

Um this was kind of a unique uh status today because all of the audit recommendations have essentially been addressed.

Um we have that one that we're just waiting on the policy to be approved.

But as of today, everything that management told us they would have addressed by their estimated data completion has been addressed.

But we'll certainly look at uh better way to share with you the status of all these records.

Because it is it is in real good shape.

You know, we've seen in the past where some of the audits are just very significant and they take a lot of time, and those recommendations are not all created equal, like you had mentioned earlier, the cash policy recommendation.

That is such a significant policy update for the whole organization that it does take time to emanate through all the departments and really process that versus other recommendations that are simple updates.

So uh to kind of keep a handle on that's important, and uh like you said, there's not many at all outstanding because the departments are doing such an excellent job because everybody's coming together.

And we talked about it just real briefly in the past about how the auditor and the city attorney's departments there's they're so necessary in keeping the city out of trouble, preventing things before they happen by reviewing their own internal procedures and making sure that yeah, you're doing what you say you're doing, we're here to help, and we're a team against the outsiders that are trying to find you doing something wrong.

We're here to help and we're a team against the outsiders that are trying to find you doing something wrong internal audit and the city auditor's departments are like they're the you know I see on the screen here the IT heroes you know they with the departments are the champions against the outside world who's trying to trying to find out everything that's going wrong and prevent that you know before it happens.

So everyone's doing such a great job with that thank you please your comments chairman made me think of um a question do we ever do a press release to uh highlight the the good work that the department's doing um the clean findings etc or just the way the departments are moving on some of the recommendations again to your point just to sort of sing your praises and the good work of the city and its teams Brian Smith City Auditor you know in the past a while ago we did do an annual follow-up report that became a public report like all of our audit reports um we we've never done formal press releases we certainly could that's something we could look at um I I'm not sure how much the press you know pays attention to the agenda of this meeting that as you're aware there have been times when press has shown up and pick up on some of the uh elements of our audits but uh that's certainly something we could look at yeah they do seem to show up but they seem to show up when things are going wrong so the fact that everything is going right is a great is a great thing and excited about that.

Are there any more questions from the members?

Seeing none this item is report only and no motion is required we will move on to item number eight item number eight report by staff regarding fraud prevention and detection program Joe Thronebury senior forensic auditor will give this report please go ahead Mr.

Throneberry Thank you Chair Price as stated previously with um the audit committee in prior meetings the city's fraud hotline went live on September 23rd 2024 so just uh over a year um that hotline is accessible via phone mobile devices online both internally and externally 247 allowing individuals to submit reports in in multiple languages just for our new um committee members prior or the current fraud policy which is being updated was originally created in the early 2000s and directed folks um to the marshals uh DPS to to call in um as if they were reporting a crime so it wasn't very user friendly and and um anonymous um ways to report uh tips was not in in necessarily um available or is uh easily accessible the fraud hotline now is accessible anonymously you can identify yourself and with it being available internally and externally is available to anyone who wishes to um to to report information that the city should be aware of and when that uh comes in it is through the ethics point case uh system that sends an email at to the city manager city attorney and city auditor who review that and then delegate that out to the um to the appropriate staff to to work um whatever tip um or information was provided um how we've communicated that uh so um we have fraud posters posted um their their speak up posters that have now been provided um and distributed to all departments and should be included with other mandatory hr information so you should see these up with the other uh hr information that's legally required to be posted these um a hr has communicated and posted those um throughout the city additionally the hotline um has been addressed and promoted in multiple weekly updates that come out every Wednesday to employees um uh uh through their email account we are looking at other ways you mentioned uh you saw one of the IT pop-ups uh for cyber security month we are taking a look and partnering with uh the city manager to have a similar um especially in fraud awareness week uh upcoming in November having uh additional communications focusing on uh fraud waste and abuse reporting throughout the um throughout the city so that uh QR code on the poster is an example of um should be scannable uh from the uh screen or if not on the agenda that will um allow people to report um through their mobile device the fraud committee as i as i mentioned is comprised of the city manager city attorney and and city auditor and meets monthly or as needed depending upon the the circumstances to review activity related to fraud waste and abuse the fraud committee through its staff um is actively working to update the city's fraud policy which I mentioned and align it with related procedures based upon best practices for

the city manager to have a similar um especially in fraud awareness week uh upcoming in november having uh additional communications focusing on fraud waste and abuse reporting throughout the um throughout the city so that uh qr code on the poster is an example of um should be scannable uh from the uh screen or if not on the agenda that will um allow people to report um through their mobile device the fraud committee as i as i mentioned is comprised of the city manager city attorney and and city auditor and meets monthly or as needed depending upon the the circumstances to review activity related to fraud waste and abuse the fraud committee through its staff um is actively working to update the city's fraud policy which I mentioned and align it with related procedures based upon best practices from from across the nation um as it relates to other cities counties states um city auditors inspector general's office for government reporting um so we are looking at best practices as well as taking lessons learned from the activity that has been reported into the fraud hotline thus far um as of this morning we have 36 um incidences that were reported through the um hotline action is taken on all complaints um either by initi initiating an investigation making a referral to human resources if it involves an employee it issues involving vendors and contractors um would go to um the city manager and department of uh finance um for purchasing contract uh review and then um look uh most of the complaints that have come in have been referrals so it's guiding the citizen um in in most cases it's an external person reporting an issue such as identity theft or another complaint and directing them to the most appropriate resources which is usually the Las Vegas Metropolitan Police Department so we are having citizens interact people are finding it they are reporting information um and in most cases it's external it involves identity theft or other conduct that um the individual feels is fraud waste or abuse so we guide them into the right uh resource um so that they can get that activity um resolved the city auditors uh office will continue to um partner with the city attorney and city manager to further promote the hotline as uh we talked about amongst employees um and where appropriate participate in fraud investigations to ensure that any citywide or department systemic issue has uh been addressed so we are looking that when there is a confirmed fraud that we will go ahead and and look at that from an internal general audit perspective to identify those control failures look at policy enhancements and and make those um improvements so that uh we don't have that issue reoccur again hopefully um this concludes my report and I'll now open it up for any questions are there any questions from anyone please thank you Joe you said 36 incidents that is that since the hotline opened it it is since it opened okay and those are confirmed fraud no they they are um incidences that were reported in out of that um there is one open um one open outstanding issue that is being looked at what the city auditor's office does is uh is looking at doing is providing an annual report based upon the calendar year that will outline what the actions are but most um nearly all of these were issues either uh policy and procedure that were human resources um related or they were um issues of a criminal nature that um did not involve the city and is it your office that handles that responds to everybody who calls in and makes that referral and if so what's your average timeline for actually responding or getting back to somebody who's called in something that really is a case for a metro we um so it do is posted that it's a non-emergency that if they have an emergency to to dial 911 that we have out there but the um the emails that come through are um are are addressed in I would say reviewed um near instantaneously um or within usually a less than a 12 hour period they go to the city attorney city manager um and city auditor and the communication has been less than 24 business hours in in all cases and Brian Smith City Auditor.

And so we're able to uh respond to the reporter very quickly.

Now, one thing I'm working through right now is when there is a case of confirmed fraud.

I'm working through how best to communicate that with council as well as the citizen committee members.

And in fact, we have a fraud committee meeting this week, and one thing I plan on discussing with uh Mike and Jeff is potentially having in the private briefings with the council briefings.

I think that may be the best place for us to share that information with you.

Um if you have any input on that, I'd appreciate that.

So, as Joe mentioned, there is currently an ongoing investigation that we'll want to report to you at the proper time.

Thank you, Mr.

Chairman.

Are there metrics that other municipalities or government organizations use to validate the efficacy of their fraud report system?

You know, is there some group who does it really well, and it's on uh per employee X amount of reports per what?

I mean So there are vendor standards as far as based upon full-time equivalent hours that you would look at for an organization or the city, such as having nearly 4,000 employees, what you would expect.

We are under that average based upon what the vendor has uh stated, so that is a positive one unique factor is the community.

Each uh each jurisdiction may have different issues, and so um we see a lot of the fraud policies where the city uh auditor's office may be independently elected, or it um it may be where they um they are under the city manager's structure versus ours, uh which reports to mayor and council.

Each jurisdiction, depending upon how they're structured, has their own unique format.

Um a lot of them will take the information, make a referral.

One thing that uh we are looking to do um is is work collaboratively with all three, um, city manager, city attorney, and city auditor, have the offices work uh collaboratively from the start uh so that um everyone who needs to know is involved and we can most effectively address that issue.

Um, which that is uh um that is uh sample model from from across the country.

Um average turnaround time because these have been one off and not an overwhelming um uh number, we're able to address them, and we are working on our KPIs um after we have this year's data.

And did I hear you correctly that that you expect there'll be a calendar year end of the calendar report that we are looking at that, yes.

Be assembled or okay.

Thank you very much.

Any additional questions?

I'd just like to add uh briefly that um it's great to hear the speed with which you respond.

And fortunately, or unfortunately, whatever it is what it is.

There's there's so many um calls to the hotline, a lot of them are not related and can be uh correctly uh moved on to someone that can help them.

But the idea that whoever contacts the hotline that they feel they are being heard and getting a response and that it's being taken care of, whether it's you know this department or any other department, just the idea that someone is paying attention and looking at it, I think is just such a vital part of it uh to give them closure and and legitimacy to the hotline that everything is getting reviewed.

So, and that's what's happening, so it's fantastic.

Uh with with any no additional questions from the members, this item is a report only, and no motion is required.

We'll now move on to item number nine.

Agenda item number nine, discussion regarding topics for future agenda items.

Comments made during this portion of the agenda by individual members shall refer solely to the proposals for future agenda items, and any discussion shall be limited to whether or not such proposed items are within the purview of the committee, and or whether such proposed items shall be placed on a future agenda.

No discussion regarding the substance of any such proposed topic shall occur, and no action shall be taken.

Does anyone have any suggestions regarding future agenda item topics?

Seeing none at the moment, uh we will move on to item number 10.

Item number 10, citizens' participation.

Public comment during this portion of the agenda must be limited to matters within the jurisdiction of the committee.

No subject may be acted upon by the committee unless that subject is on the agenda and is scheduled for action.

If you wish to be heard, come forward, give your name for the record, and the amount of discussion on any single subject, as well as the amount of time any single speaker is allowed, may be limited.

Is there anyone wishing to be heard at this time?

Seeing no one, I'll close the citizens' participation and we'll move on to item number 11.

Agenda item number 11, adjournment.

The next audit oversight committee meeting is scheduled for Monday, January 12th.

And with that, the meeting is adjourned.

We don't know exactly if it'll be in this room or not, but we'll we'll know.

With that, the meeting is adjourned.

Thank you.

Thank you, guys.