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HomeMy WebLinkAboutFIN 18/99249 ioNOF� � 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, 250 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: ��,eS�J� � i �. � = G, A.1'alcrsun Dircclur uf Fiuuncc wid 7'rensurcr ApproveJ / @ndorscd Dy: � .4,� Councillor Urcnncr Chuir, Audit CommiUcc GP:Ir Altnchmenls Copy: ChicCAdminislrativc Officcr All Dcpartment Ilcads RecommcndcJ for Ihe considcrution uf I'ickcring Town Council . ,� u � � om�a 1. uinn Cliicf dmim Iivc Offi e 252 � ��� � ,. � J(!U'!'C•/l� .JlG'�f'� cf!/1ClQ[/� �/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. ../2 P.O. BOX 450 PICKERING, ONTARIO L1V 2R7 TEL: (905) 88]•8858 FAX: (905) BB�•J42A � + ' I'hu Curpur�tiun ut'tha 7own nt' Pickaring • Pauc ? �i:�«i� � i, im�n 253 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. 1VCH:ns ' l 1 � , � •� 254 �� OF p� Wti0 F ATTAt�IMB�TN z TOIIB04TN� I$/ q9' 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, ,,,./2 255 -•z-- ,,,, ,,,. 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. ��•, , 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, A ...,/3 • 256 --3-- 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. . +