HomeMy WebLinkAboutFCS-15-111 - 3rd Quarter Audit Status ReportStaff Report
rR finance and Corporate Services Department www.kitchener.ca
REPORT TO: Audit Committee
DATE OF MEETING: October 5, 2015
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: September 16, 2015
REPORT NO.: FCS -15 -111
SUBJECT: 3rd QUARTER AUDIT STATUS REPORT
RECOMMENDATION:
No recommendation required. The following information is being provided as an
update and assurance on internal audit matters, in accordance with the Audit
Committee Terms of Reference.
BACKGROUND:
The following report provides a summary of the Internal Audit activities completed
during the period of June 2015 to September 2015. The chart below shows the audits
contained in this report.
The following items are currently in progress and will be brought forward at a future
audit committee meeting:
• Community Centres Comprehensive Audit
* ** This information is available in accessible formats upon request. * **
Please call 519- 741 -2345 or TTY 1- 866 - 969 -9994 for assistance.
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REPORT:
1. Office of Mayor and Council — Organizational Review
Status: Complete, June 25, 2015
Audit Objective
The objective of this review was to ensure that the organizational structure of the
division and the individual roles and responsibilities meet the requirements of the
current council.
Methodolo
This audit included the following activities:
• Consultation and needs assessment with staff, Council, and senior management
• Analysis of strengths and weaknesses of current structure
• Benchmarking structure to other municipalities
• Review of job descriptions
Current Organizational Structure and Roles
The Office of the Mayor and Council is a division within the CAO department, reporting
to the Executive Director, Office of the CAO. The staff generally provides administrative
support to the elected officials in various capacities.
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Chief of Staff.
• Manages three staff within the division
• Government relations
• Supports the mayor on various committees such as LUMCO
• Supports the corporation for inter - government issues, for example acting
as project manager for the 2 -way GO project
• Supports Council for projects or other support as needed
o Research, organize meetings, liaise with staff to get answers to
constituency issues
Executive Assistant to the Mayor.
• Provides administrative support to the mayor
• Initial point of contact to the mayor
• Helps resolve and respond to constituency concerns
• Scheduling / organizing of invitations, meetings
• Writing programs, articles, speaking notes
• Planning and execution of events
• Follow -up and remarks for invitations
• Conference and travel expense preparation
Two Constituency Assistants:
• Each provide administrative support to five councillors
• Helps resolve and respond to constituency concerns
• Scheduling / organizing of invitations, meetings
• Writing programs, articles, speaking notes
• Outreach — mailers, setting up public meetings, etc
• Conference and travel expenses preparation
• Planning and execution of events
Paid Co -Op Student or Other Unpaid Placements / Volunteers (not shown on chart)
• Assist constituency assistants
• Special administrative projects such as creating contact lists
Consultation and Needs Assessment
The following stakeholders were interviewed as part of this review:
• Division staff (One manager and four staff)
• Mayor and Council (11 members)
• Executive Director, Office of the CAO
• CAO and 2 DCAO's (One was not available)
The following sections summarize the feedback that was obtained through the interview
process.
General Performance
The majority of stakeholders (2/3 of Council and all senior management) feel that staff
provide a very good or excellent level of service and support. Many mentioned that staff
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are there when they need them and will do almost anything asked of them, within
reason. None of the stakeholders were unhappy with the service provided.
Needs Assessment
All participants were asked whether there were any Council or corporate needs that
were currently not being met that should be addressed.
There was agreement in all groups that staff need time to be more proactive and less
reactive. The current volume of workload leaves very little or no time for proactive
planning and outreach. Better customer service could also be provided with shorter
turnaround times for constituent issues if there were more resources. There were a few
specific areas mentioned that would provide benefit to Council.
First, it is desired that staff spend more time focusing on support for community
engagement activities and facilitating Council outreach through things like blogs,
newsletters, mailings and community meetings. This could also involve assisting
Councillors to have more of a presence on social media, helping to prepare and send
out communications, and creating media opportunities to help Council get their
messages out. They have missed opportunities in the past due to lack of resources.
Another idea mentioned by several people was to create a public affairs / media
relations position to handle these tasks.
Second, everyone would like to utilize the call statistics being gathered in the ACR
system in order to summarize and then act on common constituent issues within
specific geographic areas. Councillors would like to know what the trending issues are
in their wards in order to act on them and as input into their newspaper articles. ACR is
being replaced with a new Customer Relationship Management (CRM) system in 2016
which will provide more fulsome analytics by ward. It is acknowledged that the current
ACR system cannot provide this level of detail, however, it is still desired that some
analysis be done with the statistics that are available.
A few councillors mentioned that they currently do not utilize staff as much as they
would like to because they see how busy they are and do not want to burden them
further. If given more resources they would appreciate more help with administrative
tasks such as scheduling, the outreach activities noted above, and research into policy
ideas. Some members have previously requested additional staff through the budget
process but were voted down.
It was also mentioned that it is desirable to be seen as having adequate capacity to
support Council in order to attract a variety of candidates in future elections. Having
limited administrative support may be seen by some to be a road block to entering
politics.
On the flip side, a few councillors felt that the office is over staffed. It was felt that
Council should be able to do a lot of the administrative work themselves.
All were supportive of having co -op placements in order to assist with workload and to
provide students with opportunities to work in government.
FBI
Organizational Structure
Participants were asked what changes they would make to the current roles,
responsibilities and organizational structure in order to meet their needs, if budget were
no object.
Responses were varied with no consensus on a particular idea or model. The following
ideas were provided.
There were four of twenty individuals (20 %) who felt the current structure was working
well and that no changes were needed. Another 3 of 20 (15 %) did not comment on the
organizational structure or staffing levels. There was acknowledgement by all of the
staff and some of Council that their workload is high and they have no capacity to take
on new initiatives in the current structure. A need for extra staff was mentioned by 9 of
20 individuals (45 %). 4 of 20 (20 %) felt the division was overstaffed.
In addition to allowing staff more time to work on outreach and data analysis, other
ideas for the extra resources include:
• Splitting the chief of staff role into two separate positions — one focused on
supervision of staff and the other on government relations
• Use the chief of staff FTE differently
• Additional support for the mayor
• Additional constituency assistant (either full time or part time) which could be split
between helping the mayor and helping councillors
• A person to focus on inquiries and invitations
• Media relations / communications role
One idea to create capacity without adding headcount was to switch the roles and
responsibilities. Currently the two constituency assistants provide support to five
councillors each. They suggested realigning roles to be focused on just one task for all
councillors instead. For example, one assistant would be responsible for handling
phone calls, walk -ins and constituency issues while the other is responsible for
scheduling, invitations, and outreach. Opponents to this approach note that this would
make it more difficult for Council to know who to go to for various issues and would limit
growth potential of employees.
One idea that was seen in the benchmarking (below) and also mentioned by
participants was to consider making some positions temporary and tied to the term of
Council, rather than permanent positions. This would allow elected officials to hand
select individuals to support them. There are several pros and cons to this model. The
most prevalent downside of this model is lack of continuity and loss of corporate
knowledge if staff turnover every election cycle. As it is, Council would like to see more
continuity in staff as there have been several leaves and turnover in the past several
years. In addition there is no easy way to transition to this model without laying off
current permanent staff. On the positive side, elected officials are able to choose
individuals who reflect their political views and are in sync with their communications
style and messaging.
A few people are placing great hope in the new CRM software and believe that it will
alleviate some workload and solve many problems. It remains to be seen if the
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software will actually provide efficiencies or whether it will actually add more workload
since analysis of data would become a new task. In theory, having an automated report
tool such as this should increase efficiency. However, little analysis was being done
previously so this is in fact new work and an increase in service level.
Chief of Staff Role
In general there is confusion and lack of understanding regarding the chief of staff role.
The division as a whole, including Council, would benefit from knowing the scope of this
role, current priorities, and available services. A quarterly update similar to the one
provided to the Corporate Management Team might be helpful and well received. Many
councillors felt that the chief of staff role could provide more value through providing
more assistance with research and strategy. Many felt the role of the chief of staff is to
drive the election platform priorities of mayor and council forward and act as a project
manager to ensure they get accomplished over the term of council. Some also felt this
position should play a larger role in public relations and communications.
Only a few felt that the role was not needed and that it was not the municipality's role to
lobby other orders of government. They felt this role should fall to FCM. Or
alternatively that liaising with other orders of government could be done by staff in the
CAO's office. They felt the FTE from this role could be better utilized in some of the
outreach or constituency assistant tasks.
Several people did not like the "chief of staff' title as they did not feel it had any
significant meaning and / or that it sounded pretentious. As per the benchmarking, only
one other municipality (Hamilton) had a chief of staff title for the lead role in the division.
( *Note: Calgary is also known to have a chief of staff role in the mayor's office, however
this information was not provided as part of the benchmarking information and is thus
not included below). This title is more often seen in provincial and federal level
government offices.
Benchmarking
Nine cities were contacted to provide benchmarking information about the structure of
their office of mayor and council. The following six cities responded: Hamilton, London,
Calgary, Cambridge, Barrie and Guelph.
The three smaller municipalities (Barrie, Cambridge and Guelph) had similar staff
complements to support similar sized councils (8 -12 members). They each had 2 -2.5
staff in executive assistant and administrative assistant positions. Cambridge also had
a government relations position which did not report through the office of mayor and
council. Barrie's executive assistant position is tied to the term of council and is hand
selected by the mayor.
The three larger municipalities (Hamilton, London, and Calgary) have various structures
to support 14 -15 members of council in a single tier structure with larger populations
and thus have significantly larger staff complements.
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Both Hamilton and Calgary have a political structure where the employees have a four
year term tied to the term of council. However, there are still some staff in both
organizations who are permanent employees.
In Hamilton, there are at least 21 staff — six in the mayor's office and each councillor has
one or more staff to support them directly. The mayor's office consists of a chief of staff
who manages five other staff including:
• Community relations advisor
• Communications advisor
• Scheduling / office management assistant
• General assistant
• Policy advisor
In London the councillors' office consists of an executive assistant who manages five
other staff including:
• Two administrative assistants
• Receptionist
• Two co -op students
There is also a separate mayor's office section, however, information was not provided.
In Calgary there is an office of councillors governed by a coordinating committee of 3 -5
councillors which consists of a manager, 5 full time staff, and 2 part time staff including:
• Administrative officer
• Assistant manager
• One full -time and one part -time coordinator
• Two full -time and two part -time receptionists / administrative assistants
In addition, each councillor hires three staff including an executive assistant and two
communications and community liaisons.
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Recommendations
Culture
Staff should be empowered and encouraged to anticipate council needs. The culture
needs to shift from one of administrative proficiency to one of value -add analysis and
support. This can be done with a shift in focus of what's important to the division
through the creation of a division mission and mandate. The administrative tasks still
need to be done, however, more importance should be placed on providing outreach,
analysis of trending issues, and helping council implement their platforms. Going
through the exercise of clarifying the mandate and which tasks are in scope will also
help to remove tasks not within the mandate and free up more capacity for the value
add tasks.
New Services
The division should work together with Council to create a strategy for providing more
outreach / community engagement support services including what that looks like, end
goals, and performance measures.
Staff should seek training if required on the current ACR system to be able to extract
data and provide analysis on trending issues to Council. Agreement should be made on
who will perform this task and what level of analysis will be provided, recognizing that
these duties may change when the new system is installed.
Given that providing this extra level of service takes capacity, adding these tasks can
only be accomplished by either adding staff, capacity or by decreasing service in other
areas. For example, tasks that could be moved to councillors include managing their
own schedules, expenses, or constituency concerns. Outreach and data analytics are
value -added tasks that are desired by Council and should be made a priority within the
division.
It is not recommended to add new positions such as communications or media relations
specialists. Although nice to have, these roles can be played by existing staff if more
capacity is added. Clarification should also be given to Council regarding the mandate
of the Communications and Marketing division related to what tasks they will and will
not perform for Council.
Resources
It is clear that in order to provide a higher level of service desired by the majority of
council that more resources are required. It is recommended that a budget issue paper
be presented to request an additional part time constituency assistant. Based on the
benchmarking information from the smaller similar sized municipalities, additional
resources beyond the extra part time position do not appear to be warranted. It is
acknowledged that for the 2016 budget cycle that no new operating funding will likely be
available. Therefore this request will need to wait until future budget years when
funding is available. In the meantime consideration could be given to increasing the use
of paid university or college co -op placements which are at a lower cost and do not
require permanent funding.
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Another resourcing option to consider would be to add two paid intern positions instead
of new permanent staff when funding allows. This would allow for flexibility in staffing
and provide more capacity at a lower cost per employee.
Communications
The chief of staff should clearly communicate her role to council and solicit their
feedback on areas they wish her to spend her time. She should provide a quarterly
update to them on the key issues she is working on as well.
Employment Type
There is no compelling reason to move to a political model where the employees are
hired for the term of council at this time. The risks to continuity and knowledge loss far
outweigh the benefits. However, if there is turnover in the future then this topic could be
revisited for selected positions.
Conclusion
Overall the staff of the Office of Mayor and Council division provide valued
administrative support to elected officials. They are able to manage their workload
within the existing complement however they have no capacity to add any more tasks.
Council has indicated a desire for more value -add services, specifically support for
community engagement activities and analysis of call statistics. In order to add these
services, capacity needs to be generated through rationalizing the current services
provided, and exploring resourcing options such as paid co -op placements, interns and
an additional part time constituency assistant.
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2. Petty Cash Verification Audit
Complete: August 26, 2015
Objectives
The objective of this audit was to verify petty cash balances (i.e. petty cash on hand
plus receipts of funds dispersed equaled the float amount) and safeguarding at all
locations where petty cash floats are kept.
Scope
This audit included all City locations where petty cash floats exist including:
• Community centres
• Pools
• Arenas
• Cemeteries
• Golf Courses
• Fire
• Kitchener Operations Facility (various floats)
• City Hall (various floats)
• By -law Enforcement
• Market
Some petty cash custodians were not available at the time of the audit and thus no
results are available for those locations.
Methodology
During each surprise visit a checklist was completed for the location to assess the
following:
• Cash plus receipts equals float total
• Whether the safe was locked
• Whether deposits are current
• How many staff have access to the safe
• What other assets are kept in the safe and are they safeguarded appropriately
• Any other control weaknesses
Findings
All cash variances are considered minor, with 25 out of 30 locations reporting a variance
of $5 or less. Of the five locations with variances larger than $5, the highest amount
was $116 over. Six locations balanced exactly, 15 locations had positive (over)
variances, and only nine locations had negative (short) variances, with the largest being
only $7 short. Records were generally organized and current. Controls appear to be
sufficient and staff are following established policies in most locations. All reconciliations
are current.
Overall the cash count results were very positive and indicate a low risk in the area of
cash management.
Recommendation
The value of the petty cash floats is small, usually between $100 - $300 each. The
variances are very small and no instances of theft have been found. The risk is very
1 -10
low. There is still benefit in doing the surprise audits as it shows staff that there is
oversight for the process and it helps to identify areas where the correct procedures and
policy are not being followed from time to time.
However, the cost of performing the petty cash audits is quite high given the staff time
and local travel costs involved. The risk does not justify this cost every year. Going
forward these audits will be done bi- annually and only at a selection of locations, either
randomly selected or focusing on the higher risk locations.
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
This report supports the achievement of the city's strategic vision through the delivery of core
service.
FINANCIAL IMPLICATIONS:
There are no financial implications related to this report.
COMMUNITY ENGAGEMENT:
Members of the community have been informed of the results of this audit status report through
the posting of this report on the internet on September 29, 2015.
ACKNOWLEDGED BY: Dan Chapman, Deputy CAO, Finance and Corporate Services
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