Friday, March 20, 2009

Council Candidate Nick Ibarra Raises Questions about Internal Auditor's Job Efficacy; Transparency

Councilman Doug Burlison, "If I was (Internal Auditor) April (Lathrom), I think I would want more contact with my bosses...."

"The Springfield News-Leader" endorsed another Council candidate today, the second in as many days.

Yesterday, the editorial board endorsed Fred Ellison for General Seat B. Today, they endorsed Nick Ibarra for Zone 1. I have emailed questionnaires to candidates and await their responses with plans to post the questions, answers and comments in the order in which I receive them.

I found some of Ibarra's comments interesting in light of something I have been looking at myself.

From the News-Leader endorsement of Ibarra today:

"Ibarra stresses that the city hired an internal auditor in August of 2008, yet no legislation appears to have developed to show she has made progress cutting costs or changing administrative policies. He also complains that work she has done thus far has not been properly publicized."

I have been following the process of how the internal auditor's position came about and how she was selected, as well as updating the progress and process of the position for "The Community Free Press," and now, that work continues here at "JackeHammer."

From the outset, at the recommendation of the city manager, the Council determined their Finance and Administration Committee would oversee Ms. Lathrom's work and be the line of communication between her and the non-committee members among the City Council. There was however, always the understanding that any and all Council members could contact Ms. Lathrom at any time but, once the internal auditor's Policies and Procedures were adopted by the City Council on November 10, 2008, (see Council Bill 2008-322/ORD25510), it was determined it would take a majority of Council to request an audit not listed on the approved audit work program. Individual Council members have no individual authority to make changes to her work plan:

"Individual members of City Council shall have unrestricted authority to meet at any time with the Internal Auditor but shall have no authority to direct the Internal Auditor to alter the audit work plan without approval by a majority of the City Council."

Lathrom, according to the Policies and Procedures adopted, is to attend Council luncheon meetings, the City Manager's weekly executive staff meetings, and when requested by the Council, Monday night scheduled Council meetings.

Lathrom attended the meeting the night the Council approved her Policies and Procedures.

As far as what she has been working on since her hiring, one of the first things Lathrom attended to was the approval and recommendation of the Finance Department's Financial Control Procedures. In a "City Finance Update" I provided to readers in the October 22, 2008 issue of Community Free Press, the following information was provided:

City Council Adopts Control Procedures

"Springfield Finance Director Mary Mannix-Decker introduced written financial control procedures to the Council's four member Finance and Administration Committee on August 29. The committee unanimously voted to submit the procedures to City Council for adoption.

The City Council then unanimously adopted the (financial control) procedures at their September 29, 2008, Council meeting.

The procedures address several issues noted in last year's state audit report.

"...the city's Finance Department has not developed adequate procedures to ensure some departments are properly recording, reporting, and transmitting city monies," the report stated. It recommended, "the City Council ensure adequate controls and records are in place in all city departments to properly account for all monies received."

The newly established procedures address cash handling, grant application and administration, payment of invoices, petty cash and change funds, and guidelines for purchasing card credit limits.

Memorandums from the city manager's office also addressed travel expense considerations and meal and refreshment expenses.

"I've looked through them and I think they do a pretty good job of providing employees with some good guidance on how to approach some of these issues," Council's internal auditor, April Lathrom said, before the Council adopted the written procedures."

September 29, 2008 City Council Meeting Minutes confirm Ms. Lathrom was in attendance to share her opinion regarding the financial control procedures:

"April Lathrom, Internal Auditor, gave a brief description of the proposed. She noted the Financial Control Procedures were created due to concerns raised during the State audit. Ms. Collette welcomed Ms. Lathrom as a new City employee."

I attended a Missouri Liberty Coalition meeting last night, the topic of discussion was the City Council Agenda for Monday night, March 23. One of the items discussed was COUNCIL BILL 2009-059, a special ordinance adopting the Internal Auditor’s General Audit Program and Independence Statement.

There was some concern about the proposed basic audit procedures within the Auditor's General Audit Program and Independence Statement.

After the report is finalized, Lathrom, in Council bill 2009-059, proposes to:

"Contact City Clerk to arrange for a closed meeting of the Finance and Administration Committee. Forward a copy of the confidential draft report to the City Clerk for distribution to the committee members. Notify Mayor and remaining Council members of Finance and Administration meeting."

The intent is to meet with the Finance and Administration Committee in closed session to discuss the draft audit report and once approved by the committee public release would be coordinated with the Public Information Office, "A copy of the news release along with the final report will be forwarded to all council members and the city manager. The report will also be made available to the public at this time," the document states.

That action seems consistent with the Internal Auditor's Policies and Procedures, as reported in CFP's October 22, 2008 issue:

"Once an audit is completed Lathrom will distribute a written report to the Council and the city manager. While her working papers are closed records protected under state law, the final report will be available the the public."

If one will refer back to the Auditor's Policies and Procedures approved November 10, 2008, one will find under the heading, "Management Response" these words:

"After receiving the management response, the Internal Auditor will incorporate the management responses into the final report. This report will be sent to the management of the audited entity for final review. The final report will then be presented to the Finance and Administration Committee of the City Council and then upon recommendation of the committee forwarded to the full council for acceptance."

So, while the meeting with the Finance and Administration Committee of the City Council is not identified as a "closed meeting," in the auditor's Council approved policies and procedures, it shouldn't be a surprise there will be a meeting with the committee and, perhaps it wouldn't be out of line to question the omission of that meeting being closed from her original document?

I also believe Ibarra raised a good point. According to the News-Leader report, "He also complains that work she has done thus far has not been properly publicized." Possibly, it hasn't been publicized because unless initiated by Lathrom, herself, no one is following up with her regarding her accomplishments?

I've been asking about that, myself, because I tried to track when the last meeting of the Council's Finance and Administration Committee was held, and the last meeting I could confirm occurring happened in late November or early December of 2008.

Since Councilman Doug Burlison is a member of that committee I emailed him to inquire as to the regularity of Finance and Administration (F & A) Committee meetings. Burlison responded, "There is no regularly scheduled F & A Committee meeting."

So, I followed up with Burlison, asking: Since the Committee is responsible for tasking and communicating with Ms. Lathrom, and her employment is so new, wouldn't it make sense for the Committee to meet a little more regularly just to check in with Ms. Lathrom?

And: It just seems that, since this is a new position and a new charge of the Council and the F & A Committee is the one charged with that direct communication with her, that there would be a benefit to more regular meetings to find out how her work is proceeding, etc.?

Burlison agreed but suggested he might be waiting to make changes until after the new City Council is in place, "I feel that we do not interact with April enough, however, that is an issue I'd rather attack with 4 or 5 fresh faces," Burlison wrote. He indicated he doesn't believe there is a communication problem, per se, "I'm not suggesting that there is any kind of communication problem, I just feel like we are not doing enough of it. If I was April, I think I would want more contact with my bosses, as well."

Burlison said calling the Finance and Administration meetings together is primarily the job of the City Clerk's office. "I believe that it is mainly a function of the city clerk's office that actually arranges schedules and "calls" committees into action. As far as who makes the determination of what issues fall under certain committee umbrellas, the city manager makes the actual decision based on council (and in reality, mayoral) input," Burlison said, "The council/mayoral input is generally required only on "new" issues."

It seems there is a lot riding on the new City Council. At a recent City Council meeting, Councilman Dan Chiles suggested he would prefer to stall in regards to the forming of the Police and Firefighters Pension Plan Task Force until after the City Council election in early April, so that the new City Council could decide who would sit on that Task Force.

Update: I just received the tentative agenda for this Tuesday's City Council luncheon. On the agenda is listed: "State Audit Status Report - April Lathrom" so, that'll be interesting. :)


1 comment:

Anonymous said...

If the new Internal Auditor ever runs out of things to investigate,

she could always try to make sense all of the JQH deals the past 30 years or so, and determine what they actualy cost.