San Diego City Audit Committee Meeting Summary - October 21, 2015
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San Diego Audit Committee Meeting Summary - October 21, 2015
The San Diego Audit Committee met on October 21, 2015 at 5:00 PM to review reports from the City Auditor, discuss audit recommendations and a performance audit of code enforcement, and make appointments. Key actions included accepting the fraud hotline report, approving audit recommendation follow-ups, and forwarding the code enforcement audit to City Council.
Consent Calendar
- Minutes from the previous meeting were approved by unanimous consent.
Public Comments & Testimony
- No non-agenda public comment speakers were present.
Discussion Items
- City Auditor's Monthly Report: Auditor Eduardo Luna presented recent reports including a performance audit of Code Enforcement, a recommendation follow-up report, a fraud hotline quarterly report, and an IT risk assessment. Also noted restructuring in the auditor's office.
- Fraud Hotline Quarterly Report: Presented by fraud investigator Andy Horita. For Q1 FY2016: 21 complaints added, 9 assigned to city auditor, 12 to departments, 9 outside purview. 19 complaints closed, leaving 17 open. Seven corrective actions resulted, including vendor insurance compliance, confiscation of a city cell phone, repair of a water leak, and issuance of a business tax violation.
- Audit Recommendation Follow-ups: Assistant City Auditor Kyle Elser presented the follow-up report for all audits issued through June 30, 2015. 140 recommendations from 41 reports: 38 implemented (29%), 95 in process, 5 not implemented, 2 not applicable/not planned. Discussion focused on longstanding items like delinquent accounts (10010), take-home vehicle use (11026), DSD project tracking (12015), procurement cards (13003), and real estate assets (13009). Committee requested updates on several items, including a report on golf course financials and prioritizing water valve maintenance.
- Performance Audit of Code Enforcement: Presented by Chris Keim, Megan Garth, and Andy Hanau. The audit found poor response times (priority one cases met 29% of time, priority two 59%), inconsistent fine issuance (only 4% of cases fined, despite 32% repeat properties), and flawed performance metrics. Made 12 recommendations, all accepted by management. Management agreed to implement within 5-7 months, but committee emphasized immediate fixes for priority one cases and requested a follow-up report by the next meeting.
- IT Risk Assessment and Audit Work Plan: Presented by Eduardo Luna. First annual IT risk assessment identified five high-risk audits: Excel implementation, Treasurer's online payment systems, data center security, and SAP user access. Sensitive findings will be reported confidentially.
- Appointment to Disclosure Practices Working Group: Councilmember Zap was thanked for her service. Ricardo Valdivia was nominated and unanimously appointed to the working group.
Key Outcomes
- Fraud Hotline Report: Accepted unanimously.
- Recommendation Follow-up Report: Accepted unanimously; recommendations 10-010-018 and 13-008 were dropped (deemed not applicable/not implemented).
- Code Enforcement Audit: Motion passed to accept the report and forward to City Council, with a 90-day follow-up on priority one response times to the committee.
- IT Risk Assessment: Accepted unanimously.
- Disclosure Practices Working Group: Ricardo Valdivia appointed unanimously.
- Next meeting scheduled for November 18, 2015.
Meeting Transcript
Today we have Councilmember Laurie Zap with us. We have Committee Member Carly Schreiner, Tom Hebrink, Ricardo Valdivia. We have Eduardo Luna, our city auditor, Lisa Byrne from the IBA. A new face, Priscilla, you filling in for us today. I'm back up duty today. Okay, just for today, are you joining us for a while? Just for today. Okay, great. Well, welcome. Rolando Charvel from the Comptroller's Office, and of course, our consultant, Mr. Reilly Webb. Um we need to do approval of the uh minutes from the last meeting. We'll do that by unanimous consent unless anybody has any issues they want to discuss or correct. And those are passed by unanimous consent. I do not see any non-agenda public comment speakers for today. Any comment from Mayor's Office, IBA Committee members, City Turning. Moving forward, no continuance requests, I see. Nobody. Then we will go on to our first information item of the day, which is our monthly report from City Auditor, Mr. Luna. Thank you. Certainly, good morning, Mr. Chairman, members of the audit committee, Edwardaluna City Auditor. I'm here to present a monthly activity report update since our last meeting. Um since we last met, uh, we've issued several audit-related products. Uh the first one is a performance audit of the code enforcement division. This report will be heard at this meeting. In addition, we issued the recommendation follow-up report for the period ending June 2015. And we also issued a quarterly fraud hotline report for the first quarter of this fiscal year, and we issued an IT risk assessment and proposed audit work plan for IT. And these items will be heard um today. In terms of audits that are in progress, we have several audits that are um in field work or nearing the completion of field work. Um the public utilities overhead rates is one audit that um is near completion of field work, and we hopefully expect to begin writing the report fairly soon. In addition, we're also um uh conducting the audit of contracting follow-up, which was requested by this committee. In addition, other work that we have is the streets trenching and paving audit, audit of the library department, and just to bring to the committee's attention, we'll be issuing an intern report with regards to the library department fairly soon. Um two other audits that we've started is the audit of the housing commission, and also uh review of the Excel implementation, which we'll talk uh a little bit later during this meeting. In terms of the next slides, so that this shows the audits that have been approved but not started. Um this includes the police department property and evidence room, pedestrian safety, um, development services department permitting, fleet services, capital improvement program, San Diego Convention Center, and two annual required audits include submission day fund audit and a central stores inventory audit. And also, I'd just like to bring to the committee's attention uh recent restruction that the office um um went through. I issued a memorandum on Monday. So this concludes my presentation. Thank you for the report and having read the memo on the restructuring in your office. I think everything's gonna be just fine and with continued leadership over there. I think you guys will continue to do a wonderful job. That closes out that item and will take us to our discussion agenda, which is item number two, which is report from City Auditor on Fraud Hotline Quarterly. Certainly, um this morning we're presenting our reporterly report. Our fraud investigator and her reader will give you this update. Good morning, Chair Chairman and members of the committee. I'm Andy Horita, the fraud investigator in the Office of the City Auditor. And I'm here to present the uh update for the city's fraud hotline for the first quarter of fiscal year 2016. Sorry, technical difficulties here.
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