Update on Recommendations from KPMG, Management Partners, and Task

Force

City Council MeetingNovember 16, 2016

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Studies Resulting from Embezzlement

• KPMG – completed a detailed forensic analysis resulting in 43 recommendations on operational and enhanced oversight as well as improve various procurement and accounts payable practices.

• Management Partners – performed a desk audit of the Underground Utility Program resulting in 13 recommendations2

Studies Resulting from Embezzlement

• Task Force on Financial Administration and Internal Controls – reviewed and assessed the city’s financial reporting, systems, administration and control and provided 26 recommendations

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Common Recommendation Themes

• Establish new written procedures for the operation of the Underground Utility Program

• Segregation of duties within financial processes

• Scrutiny and maintenance of City’s master vendor list

• Clarifying and limiting us of Special Handling Requests

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Common Recommendation Themes

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• Enhancing the City’s audit function• Emphasis on employee training and

supervision

Actions Taken by Staff

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• Segregating duties within the Underground Utility Program

• Immediately separating Accounts Payable from the Purchasing Division

• Limiting the use of Special Handling Check requests

• Hired and Internal Audit Manager• Awarded contract for the Fraud Risk

Assessment

Actions Taken by Staff

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• New procedures mandating the completion of a W-9 form by all vendors

• Implementation of the new Tyler Munis Enterprise Resource Planning (ERP) system maintains segregation of duty workflows

• Completed revised Manual of Personnel & Administrative Rules and will include expanded training for all employees

Next Steps

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• Continue to review and improve all financial processes with a more focused commitment to improve internal controls and segregation of duties

• Continue training on administrative policies and procedures with an emphasis on training for Finance Department employees

• Finalize organizational structure of Department of Finance to ensure that adequate staffing exist to carryout all financial recommendations

Next Steps

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• Continue employee campaign on work product ownership and pride as well as the see something – say something motto

• Continue relationships with members of the Task Force as we implement their suggestions or evaluate other internal controls and systems.