HomeMy WebLinkAboutFIN 18/99249
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� REPORT TO COUNCIL
FROM: Giilis A Paterson DATE: Juna 22,1999
Director of Finence and Trcasurcr
REPORTNUMBER: FIN 18-99
SUBJECT: Audit Committee - Preliminary Report RE: Notice of Motion
RECOMMENDATION:
It is recommended that, Council, subject to final approval by tha Audit Committee, npprove the
drnfi amendments to thc Notice of Motion referred by Council to the Audit Committee ut its
meeting of March 22,1999 as containcd in this rcport.
ORIGIN: Council Mecting of March 22, 1999, Noticc of Motion.
AUTHORITY: Munlcipul Acl, R.S.0.1990, as amcnded.
FINANCIAL IMPUCATIONS: Nonc
EXECUTIVE SUMMARY:
Adoptian of the Motion will ensurc n fortnal Council npprovcd proccss is in placc to assist in the �
considcmtion of lhe cost of a project or program.
BACKGROUND:
At thc March 22, 1999 meeting of Council, Councillor Ryan put Corth u Notice of Motion,
seconded by Councillor Pickles, lhet wes referred to the Audit Committee. On April 8, 1999 the
Audit Committee met, discussed the Notice of Motion and heard the depututions. A letter from
the Town's Auditor regarding this motion was received and discussed, (copy atmchcd), The
Committee then ndopted the following:
1. That the notice of Motian referred to the Audit Committee by Council et its mccting of
Merch 22,1999 be received.
2. Thet the existing process:s end procedures of Council in dealing with Noticcs of Motion
as specified in Section 33 of Council's Procedurel ByInw No. 3665/91 be rcu�micd.
3. That suppori for ihe intemal controls, nnd financial processes end proccdures which the
Town has in plece, including ihose in respect to the annunl Current end Capital Budgets
be rc,aRirtned,
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Report to Council FM 18-99 June 22,1999
Subjcet: Audit Committee - Prcliminury Report RE: Notice of Mation Page 2
4. That the Movcrs and / or Seconders of Notices of Motion use the two wcek period es
specified in Section 33 of By-Inw 3665/91 to meet with the Director of Finunce and
Treasurer and any other nppropriate Department Heads in arder to ensure that infortnation
pertaining to the matter is avuiinbla to assist in Council's discussion of the Notice af
Motion.
The Committa then made certnin amendmen4s to enhance the menning and application of the
intent of the original Notice of Mation. They are contained in the attached Minutes of the
mecting and repeated below.
The Committee then referred the Motion and amendments to stutTto report back on before Muy
17,1999. This meeting was to be timed wilh the Audit Committee's receipt of the Audited 1998
Finnncial Statements of the Town of Pickering. Subsequently, the Provincinl Govemment
movcd ihe Apri130,1999 filing data for financinl statcments to May 31,1999 due to the inability
to have these statements completed until the e�'ecls of property tex capping legislution (Dill 79)
could be determined. On May 10, 1999 the Treusurcr sent an emnil to the Audit Committee end
nti'ected Councillors, info�ming Ihem of the delny in filing the Financinl Stntemenis nnd the
subsequent delay in the next meeting of the Audit Committce. We are still unable to completc
the smtements due to thc continuing production of Rcgulations nnd changes by thc Province. Wc
anticipate lhis to be resolved over the summcr months. At the snme time it was rccogniud that u
nced existed for work on the original Notion of Motion. On June 17, 1999 thc Treasurcr scnt
enother email to the Audit Commitlee and the same Councillors informing them of thc
continuing deluy in the production of the 1998 Finnncinl Statements. It was ulso mcntioned thut
work on the Notice of Motion would procced scpnrutely und Ihe Trcusurcr would be repoAing on
it soon.
Subsequently, the Chair of the Audit Commiltec, Councillor Brcnncr, has requcsted that lhis
mntter bc put before Council, in drnfi fortn prior to thc Audit Commiltce rcvicw, beforc thc end
of June at which time Council will rcccss for much of thc summcr.
The originnl Notica of Motion cun be found below, logcther with the amendments approved by
the Audit Committee.
Recommendations, Number 2,3 and 4 abovc, as moved by Councillor Hollund nnd adnpted by
ihe Committee, hnve also becn added as an enhancement to the original Motion. F�uther, stnff
suggestions hnve becn included below. Therefore, the resull is n"Consoliduted DrafY' for the
consideration of the Audit Committee which is being fonvnrded tu Council et this time far their
consideration and approval, subject to the final epprovel of the Committee.
NOTICE OF MOTION DATED MARCH 22, 1990 AS AMENDED DY AUDIT COMMITTEE
AND STAFF
WHEREAS both Council and the public require complete and accurnte information on the
estimnted cost of a project or program in order to hnve an infortned opinion of it;
NOW THEREFORE the Council of The Corporation of the Town of Pickering hereby directs
thet when e new project or other progrum that will be funded (n whole or in pnrt wes ndded by
the Audit Committee) from (public money wns deleted end any source added by stnf'f) is
introduced, an estimate of the (actunl was deleted by the Audit Committee) cost including
financing, if applicnble, and/or Ihe ennunl operating costs of the program, (in esch of thc first fivc
ycars of its operation wes deleted by thc Audit Committea) will be included in Ihe propos9l; and
THAT the existing processes and procedures of Council in deniing with Notices of Motion as
specified in Section 33 of Council's Procedural By-law No. 366�/91 be reuffirmed (added by
stetf end the Audit Committee; end
, Report lo Cuuncil fIN i B•99
Subjecl: Audil Comtnillcc • Ptclintinury licporl Rli: Nulicc of Motiou
,��,� zz, 1999 251�
1'ugc 3
THAT support far thc inlcrnul cuntrols, aud finwiciul pruccsscs aud pruccdures whicl� Ihc'Ibwn
hos in placc, including Ihusc in respcct lo Ilic unnuul Currciu unJ Cupilul l3uJgcls be reuflirmcJ
(addcd by stuff nnd thc Audit CommiUcc);wiJ
THAT the Movers wul/ur SeconJcrs on Nolices uf Molion usc Ihe lwu week period as spccificJ
in Scction 33 of ByInw 3GG5/91 lo mccl with thc Dircctur of Finuncc w�d 7'rcasurer mid miy
othcr nppropriulc Depnrtmcnt licuds in urdcr lu cnsuro thul informulion pertaining to lhe maltcr
is availnble la assist in Cowuil's discussion of Uie Nolicc of Moliun (ndJcd by staff and 'I'he
Audil Committcc); w�d
7'l1A'f both thc inlemul unJ cxtcmal fuudiug suurccs of thcsc cslimulcd cusls bc idcnlilicd a�J
cxprcsscd in (actual was Jcicled by lhc Audil Couuuiticc nnd repinccJ with projcctcd) dullar
amounls; an�
THAT all monics lo bc proviJcd Gom tlic municipul lux basc bc cilhcr confinucd wilhin exisling
budgets anJ/or rescrv�;s, and
THAT aiy propused tax incrcases spcciul Icvics, ur linancing cusis bc iJcutificd wiJ cxpressed
ns an nnnuul eost to thc cutnplction of lhc liuunciul obliguliou; wiJ
THAT said estimalcs bc suppuricd by a s1u1T rcport including cuwmcids Gom all upplicublc
Departnunl IicaJs und (vcrifieJ by thc signuwres wns Jcicicd by stuff and repluccd with
revicweJ by) the Trcnsurer and Cliicf AJministratiti�c Oflicer.
ATTACFIMEN7'S:
I, Lcucr fronrllurtcn, (�IcQ, Sincluir Jalcd Murch 31, 1999
2, Audit Conunitlec Mccling Minutcs from April 8, I'199
I'repureJ/AppruvcJ / Hudorscd Uy:
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Dircclur uf Fiuuncc wid 7'rensurcr
ApproveJ / @ndorscd Dy:
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Councillor Urcnncr
Chuir, Audit CommiUcc
GP:Ir
Altnchmenls
Copy: ChicCAdminislrativc Officcr
All Dcpartment Ilcads
RecommcndcJ for Ihe considcrution uf I'ickcring
Town Council
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252
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�/rm�hi�rd_ ��zvun�aiilr
�IarcB )1,1999
The Corpuration of the Tu�en of Pickering
Pickzring Civic Complex
Ona The Espl�nade
Pickerim�, Ontario
L I V 6K7
Attention: Councillur 4(aurice Brenner
Choir. Audic Cnmmir,ee
Denr Counciilor Brenner:
ATTACFN�ENTN � 1b�TA�; i`311
oa�vN bl. FLETi. a � e. c.
'NARFEM C. HURREM, c a
NEILSIMCLAIR,99� t.�
:1s requested in a recent meetine a�ith the Directur of Finance. we hnve revit�vtd the
Wtice of �(otion dated March ??, 1999 tha[ ha, bean refecred to the Audit Committee.
,acwrdingly, «'t wish to procide you ai�h our vie�.es and obserrations.
\4'e �vish to state thac it is ¢ood business practice to ha�•t accurate and reliable finuncial
infocmation when considering undertaking a project or program. This includes the
estimated costs of th� project or prostam, the timing and the saurces of funds. Cauncil is
char¢ed with the responsibiliry of assessinc and approvinc ihe project or pro¢r�m ui�hin
the context of the financial resources of the municip�liry. The financial resourees �re
defined annu�lly throuuh the budget process.
From a general business perspzctive, an or@anizstion usually daes not enter in�o an
obligation to expend funds «ithout having somt cle�r sense of projected costs, ti�ninc of
expendinues and sources of funds. As a project or proeram progresses, �ca�l results are
compared to the forecasts on � regul�r basis to ensure that tht project is managed in an
eFticient and effective manner. In the context of a municipal environment, it is impanant
that the council hace such information so as ro protect the intercsts of the pubiic. As
council is accountabla for the financial perfortnance of the municipaliry, it is only proper
that the council hava accur�te and reliabla infortnation at its disposal to make sound
decisions.
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P.O. BOX 450 PICKERING, ONTARIO L1V 2R7 TEL: (905) 88]•8858 FAX: (905) BB�•J42A
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' I'hu Curpur�tiun ut'tha 7own nt' Pickaring
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From tlia pe�spective of in�emal cuntrols, wc ���ish to stat� di�t th� Tutvn has u wcll
established pracess in detertnining th� opemtin_! and c�pital bud_�ets �ach yc�r,
Specitically, die Town requircs tl�at esch depattment prcparc a businass casc documen�
for its capital spendin6. This ducument requires that tach departmen� provide the
financi�l infortnation reFarted to above. As council has seen. these case summuies alluw
tiiem to assess the project and mnke du necessary resourca allocatiun decisiuns �s
requited.
In conclusion. a'e feel that this tiutice of �(otion accurately retlects the intem�l controls
that are currently in place in the Tu�m of Pickerine. �Ve �rould sugeest tha� adhering tu
this astablished process «ill enabla Council to dischsree ics rcsponsibilicies tffactive(y.
Very troly yours.
Hrrrreih Flet1, Sii+clair Cliart�rrd.4ccu �la�ls
���tiJ � �Uru�
�Varten C. HuRen. C.A.
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Audit Committee Meeting
Minutes
Suhjecl lo �dopfiun
Presenk Councillor Maurice Brenner - Chair
Mayor Arthurs
Councillor Mark Holland
Councillor Dave Ryan
Tliomas 1. Quinn, Chicf Administrntivc O(liccr
Gil Patcrson, Dircetor of financc
Bruce Taylor, Town Clerk
Neil Sinclair, F{urten, Flett, Sincluir, Chartered Accountants
A mceting of the Audit Committee was held on April 8, 1999 at 7:00 p.m. in Ihe Main Committcc
Room of tlie Pickering Civic Complex. The following matters wcre discusscJ:
l. Adonlion af Minulcs
Movcd by Councillor I folland
Thal lhc Minutes oF thc Audit Commiticc Meeting of �ebruary 1, 19991�c adopled wilh
the following amendments:
n) Thnt tlie phruse "Inlerim Audit" in Ilem N4 undcr Othcr Dusincss bc clienged to
°lntemnl AudiP'.
b) That it be noted that there wns a mecting of the Audit Committec in April of 1998
regardlcss of the fact lhet Minutes of ihat meeting cannol bc located.
Carried
2. Delcentions
a) Dave Steele, 9G6 Timmins Gardens, sleted lhat he supports the Nolicc of Motion
that was referred to this Audit Committee Meeting at the Council Meeting of
March 22, 1999. He understands that there ara processes in place for sta(t' to
provide a full accounting of capital projects but thare does not appcar to be a
process for special projecls that are introduced by Members of Council, With
respect to the Millennium project, this item was premature when it was presented
to Council on March I, 1999, liowever, when the project is ready for Council
approval, all financiel metters must be induded in the Report to Cow�cil so that the
Members of Council will have all the information at iheir disposal. Mr. Stcelc
further commented on the composition of the Millennium Committee, their voting
rights and noled thet the Committee could have solicited tnore input from local
groups,
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b) Phil McMullen, 516 Kingston Road West, Ajax, rcpresenting PAC't', slaled Iliat
lhc Nolice of Motion implics that only projects tliet urc fully funded by tlic Tawn
should set out full financiel information. Thc Motion should bc�nmendcd to slnte
that projects that are fully or panially funded by tha Town should liave that
infortnation.
� � � c.,
c) Tcrry Whitc, 1547 Marshcourt Drive, steted that in private praGicc, wsl eslimntes
musl accompuny all feasibility studies and this should ulso apply lo projects
inlroduced by Council. If a project is so technical in nature ihat sta(i are not able
to pruvide cost estimales, then Ihe advice of a consultunt should be saught, I ie
stated that he supports the Mnrch 22nd Notice of Motion Ihat wns referreJ tu Ihis
Committec.
d) Dave Stcele, 966 Timmins Gardens, stated that althouFh the March I, 1999
motion rcgarding the Millennium Committee only dealt •�.ith ihe approval to seck
grants, funding information could havc bcen provided by calling ollicr
municipalities to determine what grants thcy haee reccived. lie asked if Ihc
revenucs end expendiwres incurred by Ihc Millennium Committce are subjecl to an
audit in the same manner as olher Town funds and if the Commitlec is expecicJ ro
follow Town policies such as ihe Purchasing Policies.
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e) loan I�udson, 338 fiddlcrs Courl, stated llial shc supports Ilic Mnrcl� 22nd Nolicc
of Motion and nolcd thal it rcllects financing principlcs that nre uscd in busincss
and personal finances.
Q David Hume, Pickering Vil�agc, represcnting PACT� SIpICd (IIAI �IC IS Itl�CfC51C(I III
thc Murch 22nd Nuticc of Molimi becausc it may impact on futurc projccts. I lc
suggested that thc Motion bc umcndcd lo statc Ihat financial informalion nmst bc
statcd when a projcet is fbrmally inlroduccd to Council.
g) Phil McMullen, 516 Kingsron Road West, Ajax, represenling PACf, slalcd ihat
with respecl to the ncquisition of propeny, a basic appraisal of the value of lhc
property can bc dctermincd from tlic Assessment Roll.
3. Audilor's Oninion af 111arch 22nd Notice af 111olion
Moved by Councillor Hollund
That the letter Gom Wnrren C. Hurren, C,A. of Nurcen, Plett, Sinclair, dated Merch 31,
1999 commenting on the Notice of Motion of March 22, 1999 whicli was referrcd lo this
Committee be received.
Carried
Neil Sinclair stated that he is participaling in this meeting to give an overview of thc Ictter
from Fiurren, Flett, Sinclair and to improve the process of ensuring that Council has nll Ihe
nccessary financing information f'or all projecls.
4. Nolice of Motton dnted Mnrch 22.1999
Moved by Cauncillor Holland
1, That the Notica of Motion referced to the Audit Committee by Council at its
meeling of March 22, 1999 be received,
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2. Tliat thc exisling proccsscs end procedures of Council in dcnliug wilh Noticcs uf
Motion ns specified in Section ]J of Council's Proccdural Uylaw No. 3GG5/91 bc
rcaliirmed. '
3. That support for the inlemal controls, and financial processes and procedures
which the Town has in plece, including those in respect to tfie annual Currenl and
Capitel Budgets be reafiirmed.
4. Thet the Movers and/ar Seconders of Notices of Motion use lhe two week period
aa specified in Sectian 33 of By-law 3665/91 to meet with the Dircctor of finance
and Treasurer and any otlur nppropriale Depar►ment Hcads in ordcr lo cnsurc thnt
information pertaining to the mtticr is availablc to assist in Cauncil's discussiun of
, thc Notice of Motion.
Carricd
•'� A capy of Section 73 of Dy-law No. 36G5/91 is attachcd to ihcsc Minutcs for
information.
Moved by Mayor Arthurs
That lhe Notice of Motion referred lo Ihe Audil Committcc by Council at its mecting of
March 22, 1999 bc relurncd to Council willi thc follawing amcndmcnts:
L In d�c sccond paragraph, thc words "in cach of thc first fivc ycars of ils operalioii'
bc dcicted.
2. ln thc second paragruph, lhc words "in wholc ar in parC' bc udded aller Ihe phrnsc
"will bc fundcd".
' 3. In llte second paragraph, ihe word "actual" be dcleted.
4. [n the third paragraph, the word "acwal" be replaced wilh the word "prajected.
Cnrricd
"'• A copy of the Motion with the abovc amendmeNs is attachcd to these Minutes.
Moved by Councillor Elolland
Thet the March 22, 1999 Notice af Motion, as amended by the Audit Committee, bc
referred to s1afP to prepare a full report on the recommendations set out in thc Motion;
and
That stat�maka this report to tha Audit Committce before May 17, 1999.
G. Date of Next Meeline
The Director of Finence was directed to arrange a meeting aFtho Audit Committee during
the first week of May at 7:00 p,m, to consider tlie report on the March 22nd Notice of
Motion and to consider tha Auditor's Report on tlte 1998 fiscai year,
7. Adiournmenl
The meeting edjoumed at 9;53 p.m.
257
EXCERPT OR SECTION 33 OF UY-LAW NO. JG65l91
PROCEDURAL 6Y-LAW
�3 a) Notices of all new motions shall be rcad by the mover of the motion et ihe rcgular
Council Meeting immediataly preceding the Council Meating nt whicl� tlie molion
is to be considered. The motion, showing the mover and seconder of the motion,
shall elso be given in writing and delivcred to the Clerk before 4:30 p,m. of the
Tuesday preceding the mceting of Council at which it is to be considered and shall
be printed in full in thc ogenda and delivered to all Membcrs for ihat meeting of
Council and each succeeding mecting unlil it is considered or othenvisc disposcJ
of.
b) Where the iime between Council Meetings is grcate� than two wecks, a noticc of
motion, showing the movcr and seconder of the motion, may be given in writing
and delivered to the Clerk nt least two weeks preceding the meeling of Council nt
which it is to be considered and shall be printed in fuil iu the ogenda nnd delivereJ
tu all Members for thut meeting of Council and cach succecding meeting irolil it is
considercd or othenvise disposed of.
c) Where, duc to thc emergency nalure oF Ihe motion, a Member is unnble to give
notice of a new motion at a regular Council Meeling preceJing die Council
Mccting ul which il is lo bc cunsidcrcd, Uic motion, showing Ihc nmvcr nnd
secondcr of ihc motion, shall be given in writing nnd Jclivered to dw Clerk befnrc
noon of lhe Friday preceding the meeting of Council and shall be dclivercd to ull
Mcm6crs for that meeting of Council and cach succccJing mceting unlil il is �
considered or othcnvisc disposeJ oC
d) Any Mcmbcr of Council mny �grec lo sccond a notice of motion if tlic secomlcr is
absent from a meeting whcn thc noticc of molion is callcd from ihc Chnir.
e) If the mover of ihe notice of motion is absent from the mecting at which it is lo bc
considcred, thc noticc of molion shall be refcrred to tltc next rcgular mecling of
Council.
�. �258
NOTICE OF MOTION DATED MARC(122,1999
AS AMENDED DY AUDITCOJ1Ai17"7'EE
WHEREAS both Counci) end the public require complete end eccurate information on Ilie
estimated cost of a project or program in order to have en informed apinion of it;
NOW TE�REFORE the Council of the Corporation of ihe Town of Pickering hereby direcls ihat
when e new project or other program ihat will be funded in whola or in part from public money is
introduced, en estimata of tho cost including financing, if epplicable, and/or the unnual operaling
costs of the program, will be included in the proposal; and
TtIAT both the intemal and extemal funding sources of thesa estimated costs be identified and
expressed in projected Jollar amounts; and
THAT all monies to be provided from the municipal tax base he either confirmed within existing
budgets and/or reserves; and
THAT any praposed tax increases, special levies, or financing costs be identified and expressed as
an annual cost to the completion of the financiai obligation; and
THAT said estimates 6e supported by a ste(f report including comments Gom ull upplicablc
Department Heads and verified by the signatures of thc Trcasurer end Chief Administrntivc
O�icer.
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