HomeMy WebLinkAboutFCS-14-195 - 2015 Service Review & Internal Audit Work PlanStaff Report
rR finance and Corporate Services Department www.kitchener.ca
REPORT TO: Audit Committee
DATE OF MEETING: December 15, 2014
SUBMITTED BY: Corina Tasker, Internal Auditor, 519 - 741 -2200 ext. 7361
PREPARED BY: Corina Tasker, Internal Auditor, 519 - 741 -2200 ext. 7361
WARD(S) INVOLVED: ALL
DATE OF REPORT: December 1, 2014
REPORT NO.: FCS -14 -195
SUBJECT: 2015 SERVICE REVIEW AND INTERNAL AUDIT WORK PLAN
RECOMMENDATION:
That the 2015 Internal Audit work plan be approved as outlined in report FCS -14-
195 dated December 1, 2014.
BACKGROUND:
Under the Audit Committee terms of reference it is the Audit Committee's responsibility
to provide recommendations for areas of focus and types of audits as well as approve
the annual internal audit work plan.
In 2012 the Audit Committee approved a process to prioritize all City services for
review. The integrated work plan encompasses not only the work of Internal Audit but
also that of other staff across the corporation with responsibility for service review work.
By planning service review work corporately it ensures that there is no duplication of
effort and that work is integrated across departments where required.
This report shows the 2015 integrated service review work plan as well as the Internal
Audit work plan. Only the Internal Audit work plan requires Audit Committee approval.
REPORT:
Service Review Goal
The Effective and Efficient Government strategic foundation of the City's Strategic Plan
places a priority on sound financial management, asset management and organizational
governance, among other themes. The overarching goal of service reviews is to
protect the City's assets and interests, which supports these Strategic Plan themes.
This includes, but is not limited to, protecting the long term health of the organization, its
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financial and physical assets, its reputation, its ability to perform critical services and the
safety and well -being of employees and citizens.
The way that staff achieves this goal is through three main categories of review work:
1. Ensuring operations are efficient and effective as possible
• Are we doing the right things?
• Are we doing things in the right way?
• Are we making the best use of our limited resources?
2. Ensuring controls are adequate to protect assets from loss
• Have risks been adequately identified and mitigated?
• Are there structures and processes in place to prevent or detect loss,
theft, fraud?
3. Monitoring compliance with policy, procedures and legislation
• Have staff been adequately trained on what is expected of them?
• Are staff following the rules to ensure work is accurate, reliable, timely,
efficient, effective, safe, and legal?
• Are staff putting the corporation at risk in any way through their actions or
inactions?
This review work is carried out by internal audit, along with staff in the City's various
departments, to review both internal and customer facing services using a variety of
tools. These may include:
• Service delivery reviews
• Process mapping, including assessing adequacy of controls
• Time studies
• Value for money analysis
• Organizational structure review
• Review of workplace culture
• Risk assessments
• Policy review
• Compliance audits; and
• Physical inventory and cash counts
The identified risks and opportunities associated with a particular service determine
which type, or combination of types, of review is most appropriate for that service. This
will also determine who is best equipped to perform the review. Sometimes this will be
internal audit and other times it will be staff within the departments.
2015 Internal Audit Work Plan
The 2015 internal audit work plan includes service reviews assigned from the prioritized
list, as well as controls audits and recurring internal audit activities. Audit Committee is
asked to approve the 2015 Internal Audit work plan shown below as per the Audit
Committee terms of reference. A description of the types of review is included in
Appendix A.
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If Council priorities are not reflected in this work plan the order of reviews may be
discussed and the Audit Committee can give direction to staff.
Audit Area I Twe of Review
Community Resource Centres (continued Comprehensive
from 2014)
Accounting Comprehensive
Office of the Mavor and Council Organizational
2015 Integrated Service Review Work Plan
The 2015 integrated service review work plan is included in the chart below for
information only. The service reviews from the internal audit work plan above are
included in this integrated work plan.
Service
Type of Review
Resource(s)
Community Resource Centres
Comprehensive
Audit, CSD
Accounting
Comprehensive
Audit, FCS
Office of the Mayor and Council
Organizational
Audit
Information Technology
Risk assessment
FCS
Human Resources —
Accommodations
Process / Service Delivery
FCS
Human Resources — Recruiting
Process
FCS
Various INS services — To be
determined by new INS DCAO
Process / Service Delivery /
Risk Assessment
INS
For your information, the full list of service reviews (completed, pending and future) has
been included in Appendix B. This list was generated through a comprehensive
prioritization process in 2012 which ranked all services against one another based on
inherent risk, expense budget, and date of last review. The resulting prioritized list is
the basis for the service review work plans spanning a 6 year period.
Reporting
All service reviews assigned to Internal Audit will be brought forward through the Audit
Committee in audit status reports on a quarterly basis as has been done in the past.
All service reviews assigned to other resources will be brought forward through the
Audit Committee in an annual summary report in conjunction with Internal Audit's year
in review report. The report will contain the status of the reviews and any major findings
or recommendations but will be much smaller in scope and detail than the internal audit
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reports. If further explanation or detail is required by Council this can be provided upon
request.
Any reports which require a decision by Council will be brought forward to the
appropriate committee with a detailed report. For example, if recommendations within
the report indicate that a service should be discontinued, changed significantly or
additional funding is required then it would be brought forward for Council approval.
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
Work falls within the Efficient and Effective Government plan foundation area of the
Strategic Plan. The goal of service reviews is to protect the City's interests and assets
through
— ensuring operations are as efficient and effective as possible
— ensuring adequate controls are in place to protect assets
— ensuring compliance with policy, procedures and legislation
This supports the financial goal of long term financial stability and fiscal accountability to
taxpayers.
FINANCIAL IMPLICATIONS:
None
COMMUNITY ENGAGEMENT:
Members of the community have been informed of this report through the posting of this
report on the internet on December 10, 2014.
ACKNOWLEDGED BY: Dan Chapman, Deputy CAO, Finance and Corporate Services
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Appendix A — Types of Reviews
Review Type
Definition
capacity
A review of the actual transaction or work volume, the average time
to complete each transaction and the estimated required
resourcing compared to the actual resourcing.
compliance
A test to determine if staff are following all rules, regulations and
policies associated with the service.
comprehensive
An all- encompassing review of the division or service including
things like process and functional analysis, organization structure
review, controls, compliance, risk assessment, service delivery,
customer satisfaction, value for money, capacity, benchmarking and
any other analysis required.
cost analysis
A detailed analysis of direct and overhead costs of a service and
analysis of charge out rates if applicable.
customer satisfaction
A review of customer satisfaction with a service and where
improvements could be made.
follow up
An additional review of any type, not sooner than 1 year after the
original review in order to assess the impact of the original
recommendations and proactively identify any new / emerging
risks.
functional
An analysis of specifically how a process is done and where
efficiency improvements could be made.
impact assessment
A review to determine all of the up- stream and down - stream touch
points, information flows and dependencies in a process.
organizational
A review of the organizational structure, roles and responsibilities
to determine if the structure supports the efficient and effective
delivery of the objectives.
process
An analysis of what is done in delivering a particular service and
where effectiveness could be improved. (Not to be confused with a
functional review which takes it one step lower into how the work is
done)
risk assessment
An identification of all of the possible risks that could affect a
service including rating the probability and impact of the risk using
the corporate risk matrix.
role clarification
Clarification, documentation, and communication of roles and
responsibilities of similar roles to ensure there is no overlap in
duties.
service delivery
A review to determine the optimal method of delivering a service
including exploring options of contracting out or not delivering the
service at all.
value for money
A comparison of the fully burdened cost of providing a service
(including all direct costs plus overhead) compared to the cost of
obtaining the service from a 3rd party.
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Appendix B - Prioritized List of Service Reviews
The following table shows all of the service areas within the City of Kitchener.
The status column indicates whether a service review has been conducted for that service, or whether
there is one in progress or planned for the future.
The year completed column indicates the year that the service review was or will be completed.
The follow -up column indicates the year that a follow up review was or will be completed.
Future service reviews are listed in the order they will be completed based on relative priority,
subject to available resources.
Legend:
CAO = Chief Administrator's Office
CSI = Community Services
FCS = Finance and Corporate Services
INS = Infrastructure Services
Service
Department
Status
Year
Completed
Follow -
up
Communications & Marketing
CAO
Complete
2006
2010
Human Resources
FCS
Complete
2008
2010
Stores
FCS
Complete
2008
2010
Legal
FCS
Complete
2010
2013
HR - Hiring Transparency
FCS
Complete
2011
2015
Transportation Planning
INS
Complete
2011
Legislated Services
FCS
Complete
2012
Kitchener Utilities Dispatch
INS
Complete
2012
CSD Administration
CSD
Complete
2012
Emergency Program
Corporate
Complete
2013
Kitchener Utilities - appliance service, administration,
rental water heaters, water meter shop, gas
appliance financing
INS
Complete
2013
By -law Enforcement
CSD
Complete
2013
Operations
INS
Complete
2013
Aud & Arenas
CSD
Complete
2013
IT Projects & Planning
FCS
Complete
2013
Elections
FCS
Complete
2013
Market
CAO
Complete
2014
HR - Recruiting part 1
FCS
Complete
2014
Finance roles
FCS
Complete
2014
Centre in the Square / Kitchener Waterloo Symphony
Other
Complete
2014
HR - Vehicles & Equipment
FCS
Complete
2014
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Purchasing
FCS
Complete
2014
Integrated Planning
CAO
In progress
2014
Community Resource Centres
CSD
In progress
2015
Kitchener Utilities - gas distribution, gas supply &
transportation, gas meter & utilization, direct
purchase
INS
In progress
2015
Office of the Mayor & Council
CAO
Future
2015
Accounting
FCS
Future
2015
Information Technology
FCS
Future
2015
Facilities Management
INS
Future
Stormwater Utility
INS
Future
Parking Enterprise
INS
Future
Sanitary Sewer Utility - Operations
INS
Future
Program & Resource Services
CSD
Future
Minor improvements / repairs (playgrounds, parks,
trails)
INS
Future
Corporate Contact Centre
CAO
Future
Development Engineering
INS
Future
Building
CSD
Future
Sports fields, trails, parks and sites
INS
Future
Environmental services
INS
Future
Investment income
FCS
Future
Engineering Admin (Gas & Water)
INS
Future
Cemeteries
CSD
Future
Business Systems Support (SAP)
FCS
Future
Direct Detect
CSD
Future
Fleet
INS
Future
Revenue
FCS
Future
Engineering Admin (Gas & Water)
INS
Future
Tier 1 /2 Grants
CSD
Future
INS Support Systems / Business Systems
INS
Future
Asset Management
INS
Future
Athletics
CSD
Future
Economic Development
CAO
Future
Special Events
CAO
Future
Welcome Centre
CAO
Future
Engineering Design / Approvals
INS
Future
Financial Planning
FCS
Future
Small Business Centre
CAO
Future
Gapping
Corporate
Future
Volunteer Resources
CSD
Future
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Print shop
CAO
Future
2005
2010
Aquatics
CSD
Future
Golf
CSD
Future
Fire
CSD
Future
Planning
CSD
Future
Crossing Guards
CSD
Future
Engineering Construction
INS
Future
Engineering Infrastructure Asset Planning
INS
Future
Downtown
CAO
Future
Arts & Culture
CSD
Future
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