Internal Audit

Our objectives include the following:

• Enhancing the financial health of the City and providing stewardship of its resources
• Supporting/working with management to improve the city’s operations, identify areas where cost could be saved, and assure management of the efficiency and effectiveness of government programs/activities.
• We shall also provide independent assurance to management on the existence, efficiency, and effectiveness of the city’s internal control system through our various control monitoring and testing activities.
• The internal audit unit shall also provide consulting services to management: training in areas around risk assessment, internal control assessment, and other advisory services on the agency’s programs.
• Doing all of these and many others aims at assisting and supporting organizational units in achieving their goals and objectives.

The internal audit unit is a division under the Finance department. This function was established by the City’s Code of Ordinances section 4.02(3)(link is external).

As part of the unit’s authority, it shall audit any of the City’s organization unit (agency) identified in its audit plan/program, approved by the City’s Common Council.

In addition, the Code of Ordinances also empowers the internal audit unit to have full access to any books, records, notes, memoranda, or other documents maintained by any organizational unit (agency) relating to its expenditures, revenues, operations, etc. These documents shall be requested and reviewed only for the purpose of audit and not otherwise.

At the end of each audit engagement, the unit shall submit a report including the audit objectives, details of the test performed, findings/observations, recommendations for improvement, management implementation plans for each finding, etc.

Please note that the internal audit report is a public document and shall be uploaded on the Finance department webpage for public access. In addition, internal audit will support the agency’s management in the implementation process but will not implement the recommendation on behalf of any agency, i.e., the internal audit will not perform responsibilities expected to be performed by the management.

The Department adheres to the Government Auditing Standards, 2011 Revision (the “Yellow Book”) promulgated by the Comptroller General of the United States. These standards, referred to as generally accepted government auditing standards, “pertain to auditors’ professional qualifications, the quality of audit effort, and the characteristics of professional and meaningful audit reports.”

Government Auditing Standards (GAS 1.12) states "Conducting audit work in accordance with ethical principles is a matter of personal and organizational responsibility. Ethical principles apply in preserving auditor independence, taking on only work that the auditor is competent to perform, performing high-quality work, and following the applicable standards cited in the audit report.

As part of the various activities of the unit to ensure value is added to the City’s programs and operations, the internal audit shall consistently do the following:

1. Conduct Performance Audit. The General Accepted Government Auditing Standards (GAGAS), known as Yellow Book, required that the auditor perform reviews on government programs to provide assurances on the efficiency and effectiveness of these programs. About 50% of the internal audit activities will include reviews of the City’s agencies’ operations and programs to provide the needed assurance.
2. Compliance Audit: To give confidence to the City’s leadership on the level of compliance to the state, federal, and other statutory rules and regulations, the internal audit shall occasionally perform a compliance audit on the activities/operations of the different agencies within the enterprise.
3. Manage Grant Administration. The internal audit shall continue to support the different agencies on their grant applications and test the sufficiency and efficiency of the internal controls in the grant administration and process. This review aims to ensure that the grant application process meets its requirements and that there are no surprises or non-compliance findings from the City’s Single audit.
4. Process Improvement Review. We will review agencies’ policies and procedures in connection with best practices and advise on areas of improvement.
5. Financial Review. The audit will perform a quarterly review of the financial report and also conduct tests of controls around financial reporting to give assurance on the City’s financial report.
6. Risk Assessment Review/Training. We will continue to work with the City’s external auditor to assess the City’s risk and train management to self-identify the risk inherent in their businesses/operations and establish controls that will help mitigate such risk.
7. Continuous monitoring of the City’s internal control system. In addition to assessing the inherent city’s risk, the internal audit will continue to monitor the controls that management has established across the city’s operations to ensure that these controls are effective and efficient.
8. The unit will work with the City’s IT and Legal department to set up a fraud hotline where fraudulent activities can be anonymously reported without the fear of retribution or victimization. We will therefore monitor and report on the tips submitted through this medium. Please note that the internal audit will only cover FWAM incidents regarding the city’s employees or programs/operations. We will not be duplicating the work of other law enforcement agencies in the state.