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HomeMy WebLinkAboutAudit Agenda - 2022-01-24 REPORT TO: Audit Committee DATE OF MEETING: January 24, 2022 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: November 15, 2021 REPORT NO.: CAO-2022-008 SUBJECT: 2022 Internal Audit Work Plan RECOMMENDATION: That the 2022 Internal Audit work plan be approved as outlined in report CAO-2022- 008. REPORT HIGHLIGHTS: The purpose of this report is to outline the proposed assurance and consulting activities to be conducted by the Internal Auditor in 2022. The work plan consists of five assurance audits, three status updates, and one consulting engagement. There are no financial implications. Community engagement included t agenda in advance of the council / committee meeting. This report supports the delivery of core services. BACKGROUND: Internal Audit Goal The overarching goal of internal audit is . This includes, but is not limited to, protecting the long-term health of the organization, its financial and physical assets, its reputation, its ability to perform critical services and the safety and well-being of employees and citizens. Internal Audit Services To fulfill the above goal, the internal auditor provides two types of service in accordance with the Institute of Internal Auditors definitions: Assurance services evidence to provide an independent opinion or conclusions regarding an entity, operation, function, process, system, or other subject matter; and Consulting services which are advisory in nature and are generally performed at the specific request of an engagement client. When performing consulting services, the internal auditor should maintain objectivity and not assume management responsibility. Internal Audit Work plan The assurance services included on the internal audit work plan outlined in this report consists of topics that have been independently selected by the internal auditor. These topics fall broadly into one of three categories: 1) Physical assets such as physical inventory counts 2) Financial resources such as expense audits 3) Policy compliance such as hiring transparency This annual plan consists of compliance and controls audits, confidential investigations, and any other independent analysis as required. Standard assurance audit topics which are common to most organizations or other municipalities are included in a recurring 6-year plan. Other assurance topics are added as required related to emerging risks, tips, or other audit findings. The internal auditor will also provide consulting services related to process reviews, capacity analysis, organizational structure analysis, risk assessments and value for money analysis as the need arises. These services are provided to aid staff in continuous improvement in the design and delivery of City services. These types of reviews are requested by divisional management, or by Council through discussions with the CAO. Audit reports on each work plan item will be presented to Audit Committee as completed. REPORT: 2022 Internal Audit Work Plan Audit Committee is asked to approve the 2022 Internal Audit work plan shown below as per the Audit Committee terms of reference. Assurance Services: Audit Topic Type of Audit Sign Shop Controls, Process Accounting Controls Alcohol Inventory Process (Kitchener Controls Market) Staff Parking Reimbursement Compliance Physical Inventory Count verification Hiring Transparency and Nepotism Status update and compliance testing Procurement Status update Inventory Status update Confidential Investigations As required Consulting Services: Topic Type of Analysis Pandemic After Action Report Debrief Definitions Compliance audit - A test to determine if staff is following all rules, regulations and policies associated with the service. Comprehensive review analysis of all aspects of the service including processes, controls, culture, staffing, customer satisfaction and other topics as required. Confidential Investigations investigating staff or public complaints about any alleged staff wrong-doing including, but not limited to, fraud, theft, or inappropriate behaviour. Controls audit - An analysis and test of control points within a process to ensure that fraudulent activity can be eliminated or mitigated. Count Verification Sampling physical inventory counts to verify the accuracy of staff physical inventory counts. Debrief gather and analyze input from staff on what went well and what could be improved next time. Risk assessment identifying and rating the impact and likelihood of any risks or opportunities that could stop a business area from meeting their objectives. Service Delivery Review Assessment of service level needs, including recommendations for changes or improvements to service delivery. Status update A check-in on the status of recommendations and benefits achieved from previous audits or reviews. STRATEGIC PLAN ALIGNMENT: This report supports the delivery of core services. FINANCIAL IMPLICATIONS: Capital Budget The recommendation has no impact on the Capital Budget. Operating Budget The recommendation has no impact on the Operating Budget. COMMUNITY ENGAGEMENT: INFORM vance of the council / committee meeting. PREVIOUS REPORTS/AUTHORITIES: There are no previous reports/authorities related to this matter. APPROVED BY: Dan Chapman, CAO ATTACHMENTS: none CAO-2022-008 2022 INTERNAL AUDIT WORK PLAN Internal Audit Goal through ensuring: Operations are as effective and efficient as possible Controls are adequate to protect assets from loss Compliance with policy, procedures, legislation Internal Audit Services Assurance ServicesConsulting Services Objective assessment of Advisory / facilitation evidenceservices Independently chosenRequested Controls, compliance, Improvement of design investigations, and delivery of City comprehensive reviewsservices 2022 Internal Audit Work Plan Assurance Services AuditTopicTypeofAudit SignShopControls,process AccountingControls AlcoholInventoryProcessControls StaffParkingReimbursementCompliance PhysicalInventoryCount verification HiringTransparencyandNepotismStatusupdate,Compliance ProcurementStatusupdate Stores InventoryStatusupdate ConfidentialInvestigationsAsrequired 2022 Internal Audit Work Plan Consulting Services TopicTypeofAnalysis Pandemic After Action ReportDebrief Other reviews as requestedTo be determined REPORT TO: Audit Committee DATE OF MEETING: January 24, 2022 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: January 6, 2022 REPORT NO.: CAO-2022-036 SUBJECT: City Facility Usage Policy RECOMMENDATION: That council policies MUN-FAC-380 City Hall Public - Use and MUN-FAC-443 Groups or Events Usage - City Hall, Community Centres & Rooms in Other Facilities be repealed and replaced with the City Facility Usage by Groups and Events council policy attached as CAOs Office report CAO-2022-036. REPORT HIGHLIGHTS: The purpose of this report is to provide information regarding mitigation of risks identified in a Public Safety Canada audit and to obtain Council approval of a new policy which in part addresses these risks. There are no financial implications. Community engagement included this rep advance of the council / committee meeting. This report supports the delivery of core services. BACKGROUND: Public Safety Canada staff conducted safety audits of City of Kitchener facilities in June 2019 through detailed site visits, and presented the assessment findings and recommendations to management on December 10, 2019. One of the Public Safety Canada audit recommendations was related to creating a policy and procedure to better involve stakeholders, such as Security, in planning special events at City facilities to ensure adequate amount of time for preparedness and resources to work the events in order to mitigate safety risks to staff and the public. A cross-functional working group was created to address this recommendation, led by Internal Audit. A Lean methodology was employed to articulate the problem, explore root causes, and brainstorm possible solutions. REPORT: Project Overview The scope of this project included developing a common policy, procedure, and risk assessment process for all City facility or event bookings. In addition to looking at this through the public safety lens, the group also wanted to improve the customer experience when booking a facility or event with the City. An implementation plan was created to develop the following components of this vision: 1. City facility usage policy to articulate acceptable uses of City property to support staff in decision making. 2. Common facility and event booking procedure which incorporates a risk assessment and stakeholder consultation. 3. Common web page which makes it easy to explore and book any City facility. 4. Online inquiry form to start the booking process and gather information for the risk assessment. 5. Risk assessment tool and process to determine which stakeholders to involve based on the unique attributes of each event. 6. Facility lay-out templates which are pre-approved by Fire. These components are in various stages of completion at this time as noted below, with expected full implementation within the first half of 2022. Facility Usage Policy The City of Kitchener offers a variety of bookable rooms and spaces within City facilities and on City property for use by the public. The intent of this new policy is to outline what uses are permitted, and the associated requirements which must be met by the public when using these spaces. This will assist staff when deciding to accept bookings or not, and provide guidance to both staff and the public on the steps required to mitigate risks. This policy will replace the following existing policies: MUN-FAC-380 City Hall Public Use (Attachment B) MUN-FAC-443 Groups or Events Usage City Hall, Community Centres & Rooms in Other Facilities (Attachment C) The existing policies listed above are not specific enough to provide adequate direction to the public or staff. The new policy combines the content from both and provides additional specific guidance. It is also an opportunity to incorporate the new use of space fee waivers for Indigenous organizations, groups, families and individuals which was approved by Council on August 24, 2020 (Report INS-20-008). The City of Kitchener is working with the City of Waterloo to make access to public spaces a priority to ensure the Indigenous community can celebrate its culture, traditions, and ceremonies. This is part of our continued commitment to Indigenous reconciliation. The City is waiving rental-related fees for using city spaces for eligible Indigenous cultural and ceremonial events, including space rental fee, fees for associated permits if applicable (example: tent permits), and insurance coverage. Depending on the event, there may be other fees required for the Region or Province. To be eligible for waived rental-related fees, an event must meet all the criteria below: be an Indigenous ceremonial or cultural event be open and accessible to members of the local Indigenous communities comply with all City policies and bylaws related to space rentals The City Facility Usage Policy covers the following topics: Policy purpose User group definitions Available rental spaces Permitted uses Roles and responsibilities Booking procedure Cancellation policy Risk assessment procedure Fees and charges Other requirements or restrictions The following divisions were consulted on the draft policy: Legislated Services Equity, Anti-Racism and Indigenous Initiatives Facilities Management (Security and Custodial) Special Events Community Programs & Services Sport Parks and Cemeteries Economic Development / Market Neighbourhood Development Office Corporate Customer Service Connection to Municipal Alcohol Policy The new facility usage policy references that private licensed events can only be held in facilities listed as suitable locations in the regional Municipal Alcohol Policy (MAP). Through this project staff have noted concerns and elevated levels of risk with some of the locations listed in the MAP and would like to revisit the list in the future. A full regional review of the MAP is scheduled for later in 2022 and this issue will be discussed further at that time. See Attachment A for the draft policy for which staff are seeking Council approval. Event and Facility Booking Procedure Staff have created a common booking procedure so that no matter which facility or space the customer wishes to book, and no matter which staff processes the booking, the procedure to do so is the same. The following high-level process was created. Training materials for staff are currently being drafted and will be rolled out using a train-the-trainer approach. {ƷğŅŅ ĭŷĻĭƉ {ƷğƉĻŷƚƌķĻƩƭ /ǒƭƷƚƒĻƩ ğǝğźƌğĬźƌźƷǤ ε ĭƚƒƒĻƓƷ ƚƓ {ƷğŅŅ ĭƚƓƷğĭƷ {ƷğŅŅ /ǒƭƷƚƒĻƩ Ņźƌƌƭ ǒƦƌƚğķ źƓƷğƉĻ ƦƩƚƦƚƭĻķ źķĻƓƷźŅźĻƭ ĭǒƭƷƚƒĻƩ Ʒƚ ĭƚƒƒǒƓźĭğƷĻ ƚǒƷ ƚƓƌźƓĻ ŅƚƩƒ źƓƷƚ ƩźƭƉ ĻǝĻƓƷ Ή ǝĻƓǒĻ ŅźƓğƌźǩĻ ƦƩźĭĻ Ʒƚ źƓƨǒźƩǤ ŅƚƩƒ ΛƚƦƷźƚƓğƌΜğƭƭĻƭƭƒĻƓƷ ƩĻƨǒźƩĻķ ƩźƭƉ ğƓķ ĭƚƓƷƩğĭƷƭƷğƉĻŷƚƌķĻƩƭ ƷƚƚƌƒźƷźŭğƷźƚƓ The process starts with the customer. If they are explorin information and / or search features to find a suitable venue for their event. However, even if they skip that step they can still fill out the online inquiry form, requesting up to two event dates and three potential venues. If a customer calls the venue directly, calls the corporate contact centre, or walks in to the venue, staff can fill out the inquiry form on their behalf. Once staff receive the form they can check availability of the venue for the requested dates and if available will initiate the risk assessment process. If the dates are not available then they will contact the customer at that point to see if there is another suitable date. City stakeholders will review the details of the event and make comments, indicating whether the event can proceed or whether risk mitigating actions are required. Once all stakeholders have responded, staff will then contact the customer to finalize the booking and receive payment where applicable. The final step in the process is for staff to circle back with all stakeholders to confirm that the event has been booked. This will allow stakeholder groups to staff accordingly to support the event as required. Web Page Changes will be made to the existing rental web pages to create a common web page that makes it easier for customers to explore all of the available bookable facilities. Previously rental information was spread across many different individual divisional pages, with varying levels of detail and costing. by checking off which amenities and features they are looking for. The search feature returns a list of all spaces which meet the criteria. The team is working to add more information to the list including maximum capacity of the space and hourly rental rates. This will provide customers with important information regarding whether the space is large enough for their event and within their budget before they invest too much time trying to book the space. There will also be a link to the inquiry form for each space in the list, making it very easy for the customer to submit the inquiry form. All City facility groups were consulted to obtain rental rates, room capacities, and go live dates for website content and rentals, which vary between locations. These changes will be made to better support staff and customers once current Provincial pandemic restrictions are lifted and rentals are permitted once again. Inquiry Form The team has created a common facility and event inquiry form. The intent is to have one single form, no matter which facility a customer is booking. This form will be used for most room bookings and events, and will provide the required information for the risk assessment process. Existing simple booking processes for sportsfields, ice time, pool or floor time through ActiveNet will remain, as these types of bookings do not require a risk assessment and are fairly straightforward. The form collects basic information about the customer and the event, as well as facility or event specific questions which appear depending on which venue or event features the customer has chosen. Only facilities which can accommodate the estimated attendance will be shown in the list of potential facilities to choose from. Once submitted, the form is sent via email to staff responsible for room rentals at the chosen facility. Risk Assessment Staff have created an automated tool based on the Microsoft Teams platform to assess the risk of each event or booking. The data from the inquiry form is loaded into the tool which then displays which stakeholders need to be consulted. It automatically routes the event information to only those required stakeholders based on the details of the event, such as size, location or proposed activities. The stakeholders review the event details and add comments, indicating whether to proceed with the event or not, and any additional mitigating actions required. This allows staff to consistently assess the attributes of each booking or event and involve the appropriate staff in order to reduce risk to the corporation. Turn around time for this step will be two business days. Testing is currently underway. All of the confirmed booking data flows to a searchable database where any stakeholder may look at all records. For example, Security management can search all events booked for the next month which require Security resources and then schedule staff accordingly. The internal stakeholder groups that were consulted include: Fire By-law Licensing Legal Insurance Pool Parking Downtown Operations Facilities Management FM, Security, Custodial Building Parks and Cemeteries Criteria for when to involve external stakeholders, including Police, EMS, and Public Health, are already well established and have been incorporated into the risk assessment. While the form will not be routed to these external parties, the event host staff will be alerted that they need to reach out to them as applicable. Pre-Approved Facility Layout Templates It has been requested that staff work with Fire to develop pre-approved layout templates for the new Carl Zehr Square and the Market, including set-up e.g., tables, chairs, stage. This will speed up the booking process as Fire approval will not be required. This work has not begun yet due to other priorities at the Market and because the construction of Carl Zehr Square is not yet complete; work will begin on this item likely in the spring of 2022. Conclusion Having a common policy, procedure, webpage, and risk assessment tool will provide both a seamless customer experience and help to mitigate risks to the public and the corporation. The new process, inquiry form, web page, and risk assessment tool will be launched following the completion of testing, within the first half of 2022. Communications to the public will occur at that time in various formats. Going forward the policy, inquiry form, process, and risk assessment tool will be managed by the Community Services Division (CSD) since most of the rental locations fall within CSD divisions. STRATEGIC PLAN ALIGNMENT: This report supports the delivery of core services. FINANCIAL IMPLICATIONS: Capital Budget The recommendation has no impact on the Capital Budget. Operating Budget The recommendation has no impact on the Operating Budget. COMMUNITY ENGAGEMENT: INFORM he agenda in advance of the council / committee meeting. PREVIOUS REPORTS/AUTHORITIES: There are no previous reports/authorities related to this matter. APPROVED BY: Dan Chapman, CAO ATTACHMENTS: Attachment A City Facility Usage Policy by Groups and Events Attachment B MUN-FAC-380 City Hall Public Use Attachment C MUN-FAC-443 Groups or Events Usage City Hall, Community Centres & Rooms in Other Facilities zoom Policy No: Click here to enter text. POLICY Approval Date: Click here to enter a Policy Title: CITY FACILITY USAGE BY date. GROUPS OR EVENTS Reviewed Date: Click here to enter text. Policy Type: COUNCIL Next Review Date: Click here to enter Category: Municipal Services text. Reviewed Date: Click here to enter text. Sub-Category: Facility Last Amended: Click here to enter a Author: Corina Tasker date. Dept/Div: CSD/Administration Replaces: Click here to enter text. Repealed: Click here to enter a date. Replaced by: Click here to enter text. Related Policies, Procedures and/or Guidelines: MUN-FAC-325 Municipal Alcohol Policy (MAP) ADM-ELE-226 Elections Use of Corporate Resources for Political Campaign Purposes FIN-GRA-525 Community Grants MUN-FAC-495 Corporate Security Staff City MUN-FAC-415 Facility Booking Guidelines for Non-profit Groups 1. POLICY PURPOSE: The City of Kitchener offers a variety of bookable rooms and spaces within City facilities and on City property for use by the public. The intent of this policy is to outline what uses are permitted on City property and in City facilities, and the associated requirements which must be met by the public when using these spaces. The policy also incorporates use of space fee waivers for Indigenous organizations, groups, families and individuals. The City of Kitchener is working with the City of Waterloo to make access to public spaces a priority to ensure the Indigenous community can celebrate its culture, traditions, and ceremonies. This is part of our continued commitment to Indigenous reconciliation. 1 of 14 Policy No: Policy Title: 2. DEFINITIONS: Facility user: Indigenous community, public individuals, groups who book City facility rooms or spaces for public or private events, or City staff who book City facility rooms or spaces for public facing events. This refers to both the individual who makes the booking as well as any individual who is delegated oversight responsibility during the course of the booking or event. Facility user classifications: City-endorsed groups: Groups that provide services and programs that are City sponsored, recognized or affiliated. This group would include, but is not limited to, Public Art Committee, advisory committees, Sports Groups, Ethno- Cultural Committee, Artist In Residence programs, Exhibiting Artists in Rotunda Gallery, Special Event Committees that work directly with Arts, Culture and Special Events Division. Indigenous Community: Indigenous organizations, groups, families, and individuals. Neighbourhood Associations: A Neighbourhood Association is a group of neighbours who work together to engage in activities such as planning and delivering recreation and other programing that serves neighbourhood needs, special events, neighbourhood specific projects, and other social engagement opportunities for citizens. A Neighbourhood Association may or may not be incorporated. Informal Neighbourhood Groups: Groups of citizens who are neighbours, who mobilize around a common purpose, connection or vision, supported by City staff. While not formally recognized as affiliated, the City of Kitchener may provide a variety of supports to them, including access to space. 2 of 14 Policy No: Policy Title: In Kind Facility Grant Groups: Groups or organizations providing a specific event to the general public, intended for the common good of Kitchener residents, in the areas of arts and culture, minor sports and recreation, and community support and development who have received an in-kind grant from the City to cover the costs of facility rental fees and staff costs for a basic set-up only. (See policy FIN-GRA-525 for more details.) City Departments: City staff who book facilities for the purposes of public facing events such as Urban Design Awards, Heritage Awards, Protocol Events, Private Groups / Major Tenants: Groups under this category will include all other bookings including private functions, and any groups wanting to provide , open to the public or not. Smudging: a ceremonial practice that involves burning sacred or medicinal plants to create sacred smoke used to purify or cleanse people and places. The four medicines typically used are Cedar, Sage, Sweetgrass and Tobacco. 3. SCOPE: POLICY APPLIES TO THE FOLLOWING: All Employees All Full-Time Employees All Union Management C.U.P.E. 68 Civic Non Union C.U.P.E. 68 Mechanics Temporary C.U.P.E. 791 Student I.B.E.W. 636 Part-Time Employees K.P.F.F.A. Specified Positions only: Other: Facility Users Council Local Boards & Advisory Committees 4. POLICY CONTENT: Available Spaces Facility users may book the use of City facilities including meeting rooms, City Hall Rotunda, Carl Zehr Square, Victoria Park Pavilion, the Market, and other bookable City-owned spaces except as noted below. A full list of bookable spaces is located in Appendix A. 3 of 14 Policy No: Policy Title: This policy does not apply to the following City-owned facilities which are operated by arms-length organizations: Centre in the Square Kitchener Public Library Main and Branch facilities THEMUSEUM Conrad Centre Registry Theatre This policy does not apply to standard program bookings for fields, pools, ice, floor time, indoor turf facilities but would apply if the spaces are being used for special events or alternate purposes. Depending on the purpose of the booking and facility user classification there may be a charge associated with booking the facility or space. See below for more details. Permitted Uses In addition to commercial and other uses (such as cooling/warming centres), City facilities and property may be available for community-based programming and events, recreation and leisure programs for children, youth and older adults, services for vulnerable populations (such as outreach services, food distribution, homework club, etc.), events and social opportunities that encourage belonging and neighbourhood connections (including cultural celebrations and ceremonies), long term rentals (such as weekly faith groups), and one-time private rentals. The City strives to provide an open and inclusive environment and that also protects free expression. However, forms of expression such as threats, defamation, discrimination, harassment, unjustified and substantial invasion of privacy and confidentiality, and hate speech. These limits apply to speech on City property in the same way as they apply elsewhere. Facility users may book spaces for any private or public events, with the exception of: Any activity in contravention to prohibited behaviours or activities, as listed in policy MUN-FAC-495. Public events which are discriminatory on any grounds. Controversial events, content or activities which are deemed to contravene City values, as determined by City Council. Private licensed events (wedding receptions, stag and does, etc.) at buildings other than those listed in the Municipal Alcohol Policy. 4 of 14 Policy No: Policy Title: Private fundraising or charitable events, except for registered charities and recognized non-profit groups. Political campaigning, except where permitted under policy ADM-ELE-226. For-profit private events at City Hall. Non-licensed gambling or gaming activities or events. Nudity including exotic dancers or performers, that is not for the purpose of artistic expression or theatrical performance. Pornographic materials of any sort. City Hall is not intended to be used as a conference centre or market venue due to capacity and fire safety limitations. Only City-owned public events where staff are directly involved in the event delivery or private (no profit) events are allowed at this location. Unplanned events outside City Hall such as protests and vigils are permitted, unless the space is already booked by another facility user. The City of Kitchener is supportive of Indigenous fire ceremonies, smudging, or medicinal fires on City property or within City facilities. Additional information will be collected during the booking process regarding the nature, size and duration of the proposed ceremonial fire. Staff will work with the Indigenous community to ensure events can take place in a safe manner. Staff will call the Kitchener Fire Department Dispatch at 519-741-2582 before burning starts and when burning has been completed. Ceremonial fire keepers in charge of the burn must be present and observing the ceremonial fire from time of lighting to time of extinguishment and clean up of ceremonial burn. All bookings are subject to a risk assessment process, as described below, which will determine resourcing, costs, and insurance requirements. Summary of Roles & Responsibilities The facility user is responsible for the following activities: Ensuring the facility or space booked is suitable for the size and nature of the event Completing the inquiry form (staff may assist with this if required) Making all payments (if applicable) within agreed upon timelines Obtaining the necessary insurance, permits, and licenses applicable to the event within the designated timeframes. Checking the facility/space for any damage and report it to a City employee prior to the commencement of the booking. Supervising all guests during the booking 5 of 14 Policy No: Policy Title: Complying with all applicable federal, provincial and municipal laws, policies, guidelines, regulations and by-laws, including, without limitation, the Liquor License Act of Ontario and its regulations; Setting-up, cleaning and putting away the tables and chairs (where applicable) Returning the facility back to the general conditions of cleanliness in which it was found Completing the Rental Checklist with staff at the end of the rental (where applicable) City staff are responsible for the following activities: Reviewing inquiry forms Allocating facility/property space Conducting a risk assessment of the booking Engaging the appropriate internal divisions and external agencies (Police, EMS, Public Health, external security) based on the risk assessment Communicating all requirements and rules to the facility user, including the Municipal Alcohol Policy, where applicable Ensuring all payments and documentation are received from the facility user prior to the booking and within the documented timeframes. Completing the Rental Checklist with the facility user at the end of the rental (if applicable) Booking Procedure Facility users should visit https://www.kitchener.ca/en/arts-culture-and-events/rental- spaces.aspx in order to learn more about available City facilities and properties and then fill out the online inquiry form located on that page. Staff will review the request, conduct the risk assessment and then contact the facility user to confirm and then finalize the booking, if applicable. Cancellations of Scheduled Bookings All facility users must follow City of Kitchener Policies and Procedures. Failure to comply may result in the loss of access to space. The City reserves the right to cancel a scheduled booking (with as much notice to affected groups as possible) in the event of: A maintenance issue/unsafe conditions Weather-related emergencies which make it unsafe to attend for participants, volunteers and/or staff As deemed necessary by management for City of Kitchener use The City is made aware that the nature of the scheduled booking contravenes City values, as determined by City Council 6 of 14 Policy No: Policy Title: Risk Assessment Procedure Information about the proposed booking from the inquiry form will be loaded by staff into an automated risk assessment tool. The tool will determine which internal stakeholders need to review the event details based on risk factors such as size, location, and proposed activities. Examples of internal stakeholders include, but are not limited to, Security, Fire, or Licensing staff. Stakeholders will evaluate the event and provide recommendations to mitigate risks, if any, in order for the event to proceed. Staff will share the recommendations with the facility user before confirming the booking. Fees and Charges Basic room rental, set-up and staffing fees are listed in the Fees and Charges Schedule, which is approved by Council annually. Some or all of those fees may apply, depending on facility user classification as noted in the chart below: Facility User Classification Fees and Charges City-endorsed groups Up to 12 monthly meetings per year Basic rental fees waived Extra fees may apply Neighbourhood Associations Basic rental fees waived Extra fees may apply Informal Neighbourhood Basic rental fees waived Groups Extra fees may apply In Kind Facility Grant Groups Carl Zehr Square or City Hall Rotunda use only. Basic rentals are covered by the grant. Extra fees may apply Indigenous Community Rental, permit, and insurance fees - waived Extra fees may apply City department events Staff costs charged back to internal division Private groups Basic rental, set-up, and extra costs as per fee schedule Other Requirements / Restrictions: Depending on the nature of the event or booking, there may be additional requirements and rules which must be followed. Please refer to Appendix B which lists those requirements for the following topics: Mandatory insurance coverage Special event permits/licenses Licensed events 7 of 14 Policy No: Policy Title: Gambling and gaming Fire safety plan Lagging of chairs Helium balloons Candle usage Decorations Special apparatus No Smoking policy Set-up and Clean-up Rental check-list Use of music and associated fees 5. HISTORY OF POLICY CHANGES Administrative Updates The date (yyyy-mm-dd) and a short annotation on the nature of the change to reflect the current corporate structure i.e. Departmental re-organization / Titling changes / Standing Committee restructuring. \[Start typing here\] Formal Amendments -01-20 - As per Council/CLT directive \[Start typing here\] 8 of 14 Policy No: Policy Title: APPENDIX A: List of Bookable City Facilities Facility Name City Hall Rotunda and meeting rooms Carl Zehr Square Victoria Park Pavilion Kitchener Market (indoors and outdoors) Williamsburg Dedication Centre Budd Park Indoor Sportsfield and Lounge Community Centres: Bridgeport Community Centre Centreville-Chicopee Community Centre Chandler Mowat Community Centre Country Hills Community Centre Doon Pioneer Park Community Centre Kingsdale Community Centre Mill Courtland Community Centre Victoria Hills Community Centre Forest Heights Community Centre Stanley Park Community Centre Williamsburg Community Centre Rockway Senior Centre Downtown Community Centre Arenas: The Aud Activa Sportsplex Lions Arena Pools: Breithaupt Centre Grand River Recreation Complex Kiwanis Park Golf: Rockway Golf Course Doon Valley Golf Course 9 of 14 Policy No: Policy Title: APPENDIX B: Other Requirements / Restrictions INSURANCE Liability Insurance Insurance coverage for ALL events is mandatory. Insurance may be facilitated through City of Kitchener or may be obtained through another provider. Staff will ensure the facility user has the appropriate insurance for the event. The City of Kitchener will cover the cost of insurance for Indigenous community bookings. Content Insurance The City of Kitchener shall not be liable for any damage to or loss of any property brought onto the Facility. The City of Kitchener does not provide content insurance for any facility user groups. Facility user groups are encouraged to purchase adequate content insurance coverage. SPECIAL EVENT PERMITS/LICENSES It is the responsibility of the facility user to provide all required special event permits/licenses (such as but not limited to Special Occasion Permit, Insurance, temporary vendor, food shop, Barbecue permit, etc.) within the designated time. LICENSED EVENTS Licensed events are permitted however the Municipal Alcohol Policy contains additional requirements. If you are running a licensed event, please request a copy of the Municipal Alcohol Policy. It is also the responsibility of the facility user to obtain copies of the proper certification for the qualified bartender(s) and to submit a copy of these to the facility, at least 30 days prior to your event for all licenses events. GUIDELINES ON GAMBLING As outlined in the Facility Rental Agreement Terms and Conditions, it states: -LICENSED GAMBLING OR GAMING ACTIVITIES ARE NOT 10 of 14 Policy No: Policy Title: Gambling or lottery is defined as any time money is paid with the chance to win a prize. If the activity has three elements: consideration, chance and prize, it is considered gambling. The policy for gambling prohibited is taken from the Criminal Code of Canada. A facility user and/or designate who are not in compliance with Criminal Code of Canada, may be subject to a fine or imprisonment. In order to obtain a license, the group renting the facility must be a licensed charitable organization (i.e. the Optimist Club must obtain a license to raffle off tickets). A license is required if you are selling raffle tickets or tickets to see if you have the lucky number to win a prize. This is considered a lottery, whether the winning numbers are posted or a ticket is drawn from a drum. As per your Special Occasion Permit, do not raffle liquor or hold contests that involve winning liquor gift certificates may be used as an alternative. Examples of gambling activities that are prohibited without a license: Raffles, 50/50 Draws Crown and Anchor Arms lengths of tickets Examples of activities that are permitted: Fish / Duck Pond catch a fish / duck, number on the bottom which coincides with a numbered prize Silent Auction where you bid on an item Loonie Toss closest to the prize wins Hole in One Golf putting green Ball Toss, Beanbag Toss, etc. Limbo Contest Trivia Contest Guess the actual retail price closest wins Loonie Drop drop into a cup in bottle of water if it goes in the cup person wins Hockey shoot shoot ball through small opening Balloon stomp purchase a balloon, tie on ankle, last one with a balloon wins Guess amount in jar closest wins Bowling must keep up one coloured pin to win a prize Ring toss / Hula hoop toss 11 of 14 Policy No: Policy Title: Licensing Department @ 519-741-2200, extension 2275 for clarification. FIRE SAFETY PLAN As a facility user, please be advised of the following information as it pertains to Upon your arrival, please: Make note of all locations of Fire Pull stations and fire extinguishers. Make note of all fire exits. DO NOT BLOCK EXITS. ALL exits must be Prior to start of event, inform occupants/guests that in the event of fire, they must evacuate from the nearest exit to the designated safe area and remain on site until otherwise directed by the Fire Department. Upon Discovery of Fire or hearing the alarm: Remain calm. Follow the direction of staff Leave the fire area immediately. Close doors behind you. If necessary, sound the fire alarm and call the Kitchener Fire Department (911) and give the facility name and complete address Leave the building immediately via the nearest fire exit LAGGING OF CHAIRS When 200 or more chairs are set up in theatre style, they must be fastened in units of not less than four and not more than 12. HELIUM BALLOONS Helium balloons are only permitted inside the facility if pre-arranged by the facility supervisor or designate. If non-secured balloons do escape inside the facility, the facility user will be charged an additional fee. Helium tanks are not permitted unless pre-approved. CANDLE USAGE 12 of 14 Policy No: Policy Title: Candles are permitted at most but not all facilities so please confirm that candles are permitted at the facility that you are using. Candles are permitted if they are used on a birthday cake or fully enclosed in a non-flammable container such as a hurricane glass. Candles must not be left unattended and must be safely disposed of. DECORATIONS Please refrain from damageable devices to put decorations up on walls, tables, chairs, doors, floors or window treatments. Damageable devices include scotch tape, tacks and double-sided tape. Painters tape or sticky tack is allowed BUT MUST BE REMOVED at the end of the event. SPECIAL APPARATUS The use of any special apparatus such as, but not limited to; smoke machines, bouncy air castles, scissor lifts/skyjacks, etc. must be approved prior to the event by the facility supervisor/designate. Any additional requirements for the use of such apparatus (e.g. insurance, CSA approval) must be agreed upon and followed by the facility user. NO SMOKING POLICY Smoking is strictly prohibited within the entire facility and also is prohibited within nine metres/27 feet of all entrance doors. It is the responsibility of the facility user to inform their guests of the designated OUTSIDE smoking area(s). SET-UP & CLEAN-UP The facility user is responsible for setting-up, cleaning and putting away the to staff. When using the tables and chairs, please: lift these items off the floors to avoid drag marks do not kick out legs to open & close ensure that legs are in locked position during set-up wipe all tables and chairs after use return to the proper storage area from which they were borrowed use appropriate trolleys, if available 13 of 14 Policy No: Policy Title: Please return the facility back to the general conditions of cleanliness in which it was found. Please note that CLEAN-UP and or DAMAGE charges may be levied to the facility user. Please be sure ALL food, beverages and decorations have been removed at the end of the event and prior to leaving the facility. RENTAL CHECKLIST It is required that the facility user do the final walk around and check with the on- site staff person at the end of the event to ensure proper compliance of all of the above. There is a Rental Checklist that is completed by both the facility user and staff at the end of the event. The City hereby reserves the right of City staff or agent of the City to enter the Facility and take such actions as they deem necessary to ensure compliance with the terms set out herein and for the prevention of damage to City property or injury to persons. USE OF MUSIC Any music that is played at an event needs to be licensed by Entandem. Entandem is a joint venture between RE:SOUND and SOCAN created to simplify the licensing process so music can be played legally and ethically while ensuring those who created the music are compensated. This can include background music or music being performed by a band. License fees will be added to the rental contract where applicable. 14 of 14 POLICY Policy No:MUN-FAC-380 Approval Date:April 25, 1995 Policy Title:CITY HALL -PUBLIC USE Policy Type:ADMINISTRATIVEReviewed Date:July 2016 Next Review Date:July 2021 Category:Municipal Services Reviewed Date: Sub-Category:Facility Last Amended:May 27, 2002 Author:Author Unknown Replaces:I-380-City Hall -Public Dept/Div:CAO/Economic Use Development/Special Events Repealed: Replacedby: Related Policies, Procedures and/or Guidelines: To be included at next review. 1.POLICY PURPOSE: To be included at nextreview. 2.DEFINITIONS: To be included at next review. 3.SCOPE: POLICY APPLIES TO THE FOLLOWING: All Employees All Full-Time EmployeesAllUnion ManagementC.U.P.E. 68 Civic Non UnionC.U.P.E. 68 Mechanics TemporaryC.U.P.E. 791 StudentI.B.E.W. 636 Part-Time EmployeesK.P.F.F.A. Specified Positions only: Other: CouncilLocal Boards & Advisory Committees Tobeincluded at next review. 1of 3 Policy No:MUN-FAC-380 Policy Title:CITY HALL -PUBLIC USE 4.POLICY CONTENT: Identified Groupsas follows- Group 1: Government a)City of Kitchener Departments & City's sponsored events b)City and Regional Council c)City of Kitchener Advisory Boards d)Other Municipal, Provincial and Federal governmentbodies (must be related to City of Kitchener issues) e)Kitchener Public Library f)Kitchener Downtown Business Association (K.D.B.A.) g)United Way Group 2: Non-Profit a)Waterloo Region District School Board and the Waterloo Catholic District School Board b)Educational Institutions c)Public Libraries d)Social Service Agencies & organizations, e.g. Canadian Cancer Society, Big Brothers, Big Sisters, etc. e)Senior Citizens Organizations f)Service Clubs, Lodges, Fraternal Associations, Sororities, e.g. Lions Club, Beta Sigma Phi, etc. g)Local Special Interest Clubs & Organizations (made up of volunteers), e.g. Horticultural Club, etc. h)Arts & Cultural Groups i)Sports Organizations j)Neighbourhood Associations k)Ethnic Clubs & Associations l)Other Recreation Agencies, e.g. YWCA, YMCA m)Religious and Spiritual groups (subject to policy) n)Kitchener Downtown Business Association o)United Way Group 3: Profit/Non-Affiliated a)Non-affiliated groups, private individual or groups b)Commercial, profit-making groups c)Non-local community groups (See Community Services Department for specific rates.) 2of 3 Policy No:MUN-FAC-380 Policy Title:CITY HALL -PUBLIC USE 5.HISTORY OF POLICY CHANGES Administrative Updates 2016-06-Policy I-380 re-formatted tonew numbering system and given number MUN-FAC-380. Formal Amendments 2002-05-27-As per Council resolution 3of 3 POLICY Policy No:MUN-FAC-443 Approval Date:June 19, 2000 Policy Title:GROUP OR EVENTS USAGE - CITY HALL, COMMUNITY Reviewed Date:July 2016 CENTRES & ROOMS IN OTHER FACILITIES -ELIGIBILITY Next Review Date:July 2021 CRITERIA Reviewed Date: Policy Type:ADMINISTRATIVE Last Amended: Category:Municipal Services Replaces:I-443-Eligibility Sub-Category:Facility Criteria, Group or Events Usage, City Hall, CC, etc. Author:AuthorUnknown Dept/Div:Community Services/By-law Repealed: Enforcement Replacedby: Related Policies, Procedures and/or Guidelines: To be included at next review. 1.POLICY PURPOSE: To be included at next review. 2.DEFINITIONS: To be included at next review. 3.SCOPE: POLICY APPLIES TO THE FOLLOWING: All Employees All Full-Time EmployeesAllUnion ManagementC.U.P.E. 68 Civic Non UnionC.U.P.E. 68 Mechanics TemporaryC.U.P.E. 791 StudentI.B.E.W. 636 Part-Time EmployeesK.P.F.F.A. Specified Positions only: Other: CouncilLocal Boards & Advisory Committees To be included at next review. 1of 5 Policy No:MUN-FAC-443 Policy Title:GROUPS OR EVENTS USAGE -CITY HALL, COMMUNITY CENTRES& ROOMS IN OTHER FACILITIES -ELIGIBILITY CRITERIA 4.POLICY CONTENT: 4.1City Endorsed Groups (Room Use Only) (a)Criteria: Groups that provide services and programs that are City sponsored, recognized or affiliated. This group would include Neighbourhood Associations, Public Art Committee, Arts and Culture Advisory Committee, Sports Groups, Ethno- Cultural Committee, Artist In Residence programs, Exhibiting Artists in Rotunda Gallery, Special Event Committees that work directly with Arts, Culture and Special Events Division. By Council direction and/or by staff, a group may be added or deleted according to the criteria. (b)Available Room Use: (i)For all groups (excluding Neighbourhood Associations) –Up to 12 monthly meetings in a calendar year for Board, Executive meetings, etc. or for events/programs which are open and available to the community. (ii)For Neighbourhood Associations –This policy does not effect or otherwise restrict or change the use of Community Centres by Neighbourhood Associations. In addition, this policy does not alter Policy Resolution I-276 –Facility Booking Guidelines for Non-Profit Groups which deals with the booking process and considerations. (c )Rental Fees/Charges: Basic rental fee and Basic Set Up and Clean Up costs waived. If services required are beyond basic set-up and take down/clean up, costs are passed on to the group (see Extra Fee Categories). This includes costs related to any alterations to the room including moving, removing or adding furniture and equipment. These groups would not be permitted to seek grants with respect to facility rental charges (ie.Extra Fee Categories). 2of 5 Policy No:MUN-FAC-443 Policy Title:GROUPS OR EVENTS USAGE -CITY HALL, COMMUNITY CENTRES& ROOMS IN OTHER FACILITIES -ELIGIBILITY CRITERIA 4.2Grant Groups (Civic Square and Rotunda Use Only) (a)Included: Currently would include Christkindl Market, Festival of Trees, ArtWorks!, which are examples of Community Festivals. Other groups may apply for Grant Group Status as set out below. Staff will determine eligibility on a case-by-case basis. Any appeals or disagreements with respect to staff’s determination shall be made to the Community Services Committee. (b)Criteria for Eligibility for Grant: (i)Groups must provide a business plan satisfactory to the appropriate staff outlining the activity, projected budget, other sources of revenue anticipated. (ii)In addition the plan will outline the benefits and appeal it will have for a broad cross-section of the community. (iii)Organizing groups must be “not-for-profit” and directed by an Organizing Committee, Executive or Board of Directors. (iv)To be eligible for this category, there will be no general admission or a minimum charge to ensure as much public participation or access as possible. (v)Groups eligible for this category will acknowledge the City of Kitchener as a sponsor on all promotional material. (vi)Groups in this category will not be able to submit a separate grant request for facility rental fees/charges to City Council. They would be permitted to seek grants for other costs based on their eligibility under the Grant Request Policy (either Provisional Grant or Yearly Grant), having regard to any grant received with respect to facility rental under this policy. It is recommended that groups that qualify for a grantshould be encouraged to reach financial independence after 3 years from the date of this policy for current grant groups and/or after three years from the date of eligibility for new grant groups. Thereafter, groups will be reviewed on a yearly basis to determine whether the group should remain eligible for grant eligibility. Those groups who should be encouraged to reach financial independence after 3 years do not include Community Festivals which may take longer than that to become self-sufficient. 3of 5 Policy No:MUN-FAC-443 Policy Title:GROUPS OR EVENTS USAGE -CITY HALL, COMMUNITY CENTRES& ROOMS IN OTHER FACILITIES -ELIGIBILITY CRITERIA (c )Rental Fees/Charges: For internal accounting reasons, the cost to the group will be as set out in the “FeeStructure –City Hall Rental” on a per day basis and will include rental and staff costs for a basic set-up of chairs, tables, stage sections, sound system, etc. and basic cleanup. However, the group, if eligible, will be given a grant for the facility rental charges. Additional services beyond the basic set-up will be passed on to the group (See Extra Fee Categories). 4.3Municipal/Departmental Groups A number of City Departments have functions such as Urban Design Awards, Heritage Awards, Protocol Events, Mayor’s Levee, etc. Currently, these events have no rental rate applied. As was previously done, it is recommended that staffing costs will only be directed back to the appropriate department to reflect the true cost of the event. 4.4Private Groups (a)Included: Groups under this category will includeprivate functions and any groups wanting to provide “services” open to the public or not (eg. Health Coach System, Manulife Financial, Radha Soami Church, Deloitte and Touche, ACCKWA, Cancer Society, etc.). (b)Available Room Use: All Rooms, Civic Square, and the Rotunda as available. (c )Rental Fees/Charges: See “Fee Structure –City Hall Rental”. These groups would not be permitted to seek grants with respect to facility rental fees/charges. 4of 5 Policy No:MUN-FAC-443 Policy Title:GROUPS OR EVENTS USAGE -CITY HALL, COMMUNITY CENTRES& ROOMS IN OTHER FACILITIES -ELIGIBILITY CRITERIA 5.HISTORY OF POLICY CHANGES Administrative Updates 2016-06-PolicyI-443template re-formatted to new numbering system and given numberMUN-FAC-443. Formal Amendments No amendment history to date. 5of 5 CAO-2022-036 CITY FACILITY USAGE POLICY The Problem Public Safety Canada recommended creating a policy and process to better involve stakeholders, such as Security, in event planning Analysis showed inconsistent processes for event and facility booking at all City facilities, and lack of early involvement of other key stakeholders in addition to Security The Solution Facility usage policy to specify permitted uses of City facilities Requesting Council approval today An automated event risk assessment process to ensure all required stakeholders are aware and involved in the event planning A Better Customer Experience Consistent process to book an event or facility Enhanced information on our website Search on amenities Room capacities Hourly rental rates Policy Inquiry form Online Inquiry Form Gathers basic information about the event Does not guarantee the booking staff will review and contact the customer Shows only facilities that will accommodate the event (size, licensed) Completed form flows to the event host (primary facility contact) Risk Assessment Tool Information from inquiry form flows to Teams based risk assessment tool Automatically routed to only the stakeholders that need to see it (based on size, location, and other factors) Stakeholders review and add comments approve, approve with changes, deny Event host finalizes booking with customer Calendar of confirmed events viewable by stakeholders Facility Usage Policy Combines and replaces two existing policies Adds new language for Indigenous use Outlines permitted uses of City facilities and property Outlines roles and responsibilities of the customer and City staff Specifies: Booking process Cancellation policy Risk assessment process Fees and charges Other booking requirements Does Council approve this new policy? www.kitchener.ca REPORT TO: Audit Committee DATE OF MEETING: January 24, 2022 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 14, 2021 REPORT NO.: CAO-2022-009 SUBJECT: 4th Quarter 2021 Audit Status Report RECOMMENDATION: That report CAO-2022-009, regarding the 4th Quarter 2021 Audit Status Report, be received for information. REPORT HIGHLIGHTS: The purpose of this report is to provide information regarding recent audits. There are six audits included in this report as noted in the chart below. Results were generally positive, with no fraud detected. Recommendations focus on finding efficiencies, tightening controls and providing a better customer experience. There are no financial implications. Community engagement included this report p advance of the council / committee meeting. This report supports the delivery of core services. EXECUTIVE SUMMARY: The following report provides a summary of the Internal Audit assurance and consulting services completed during the period of July to December 2021. The table below shows the audits contained in this report. Division / Topic Scope OMERS Pension Administration Current State Process Mapping Stores Inventory Comprehensive audit Physical Inventory Count Count Verification Overtime and On-Call Pay Status update Technology Hardware Inventory Status update Print Shop Value for Money *** This information is available in accessible formats upon request. *** Please call 519-741-2345 or TTY 1-866-969-9994 for assistance. Consulting work is in progress on the following reviews: Training Documentation - process review Note that some audit work has been paused due to pandemic pressures and workload in subject areas. Support is being providing to the Emergency Operations Centre and to other areas where needed instead. The OMERS review recommends that staff create a temporary 18-month OMERS administrator capable of helping existing staff work through the backlog of transactions, set up a shared file for single source of data/collaboration by HR and Payroll, and establish an efficient method of tracking the status of events. During the contract, management can better assess if the volumes support an extra permanent staff or not. If so, it would be referred to the budget process at that time. The Stores Inventory analysis did not uncover any proven fraudulent activity, but has highlighted the need for tighter access controls and management oversight of what is being ordered. Recommendations to management focus on stronger controls and better customer experiences. The physical inventory process is in control and no concerns were identified. The adjustments to controllable stock are small write-ups. Uncontrollable stock adjustments are typical and are expected given the current uncontrolled environment. The status update of the overtime and on-call pay audit found that many of the recommendations have not been started due to workload pressures in Human Resources during the pandemic. In order to ensure the findings are addressed in the future, Internal Audit will continue to check in on the status once operations stabilize and the corporation enters into recovery phases of the pandemic. The status update of technology hardware inventory found that access controls have been improved and financial reconciliation is underway. A full inventory of technology assets will be conducted once staff return to the office. The outcome of the Print Shop review is to close the Print Shop, and outsource all work. The cost per impression is half the cost of any of the other options, and the City would save $322K over the next five years compared to the current operational model. BACKGROUND: The overarching goal of internal audit is nd interests. This includes, but is not limited to, protecting the long-term health of the organization, its financial and physical assets, its reputation, its ability to perform critical services and the safety and well-being of employees and citizens. Assurance services objective assessment of evidence to provide an independent opinion or conclusions regarding an entity, operation, function, process, system, or other subject matter. Audit topics are selected independently by the Internal Auditor and approved by Audit Committee on an annual basis. Audit results are brought back to Audit Committee in reports such as this on a quarterly basis as completed. REPORT: 1. OMERS Pension Administration Current State Mapping Completed: September 16, 2021 Overview: Approximately 1,500 City of Kitchener employees are enrolled with the OMERS pension plan. In 2020, the City contributed close to $11.5 M to OMERS to match employee contributions. The City has two Benefit Assistants, one Benefits Supervisor (vacant), two Payroll Administrators and one Payroll Supervisor that are all involved in the pension process in various capacities. There are several issues with the current processes which have led to employee complaints, service delays and errors made despite staff best efforts. OMERS processes with a focus on the final year-end reconciliation to OMERS. This was to include a complete review of all OMERS processes with the goal of providing recommendations on process efficiencies and automation between Human Resources and Payroll. The job competition did not yield any suitable candidates. Therefore management asked Internal Audit to conduct the current state mapping to see if any quick wins and possible next steps could be identified. Review Objective: To document the current administrative processes related to OMERS including enrollments, leaves, terminations, retirements, deaths, and year end reconciliation. Scope: The following were within scope for this review: Current state mapping of noted processes Identification of waste in the processes including wait times, re-work, and duplication of effort Identification of quick wins that could be implemented easily by existing staff to address identified issues Recommendations on a path forward The following were out of scope for this review: Root cause analysis of issues Development of solutions and future state maps Implementation of any solution Methodology: The following activities were undertaken to complete this review: Individual interviews with Benefits and Payroll staff to document the tasks they perform for each process Visually documenting each process in Visio process mapping software system Group interviews with all Benefits and Payroll staff to validate the process maps and confirm pain points and areas for improvement Preparation of summary of observations and potential quick wins Findings and Recommendations: There are 13 different types of OMERS events that fall under the categories of enrollments, leaves, terminations, and retirements. In the past year there have been 2333 OMERS events that require processing. The year end reconciliation process is dependent on all of the required OMERS events to have been processed in a timely manner during the year. Currently Payroll missing transactions. There are several contributing factors to this. First, it was observed that while each employee knew their own piece of the process, they were unaware of what others did upstream or downstream of them, or how their actions affected others. The joint meeting to validate the process maps was a good first step to share understanding of the complete process. However, it is recommended that staff continue to work together to identify trigger points and consequences of various actions in order to avoid inadvertently causing additional work. Second, there is a lack of a common view of OMERS events and related outstanding forms, with both teams tracking them separately in spreadsheets. A quick win would be to create a shared spreadsheet where all OMERS events could be tracked by both teams. Further to that, however, is that it is unclear who should be responsible for tracking the events and following up to ensure timely completion. Responsibilities should be clearly defined. Third, the volume of transactions has increased generally over time and significantly during the pandemic, without seeing a corresponding increase in Benefits and Payroll staff. The pandemic and an aging staff population has driven an increase in retirements. In addition, there were many leaves and re-enrollments that had to be processed as different staff groups were put on and taken off leave due to lockdowns and closures. While the leave volume will start to return to normal levels following the pandemic, it is likely that overall volume will continue to be high. It is recommended that staff re-write the previously approved OMERS Specialist job posting to request a temporary 18-month OMERS administrator capable of helping existing staff work through the backlog of transactions, set up the shared spreadsheet where all OMERS events could be tracked by both teams,and establish an efficient method of tracking the status of events. During the contract management can better assess if the volumes support an extra permanent FTE or not; if so, it would be referred to the budget process at that time. 2. Stores Inventory Comprehensive Audit Completed: November 9, 2021 Overview The Procurement-Stores section of the Financial Operations division is responsible for the receipt, storage, and disbursement of a variety of physical inventory used in City operations. This inventory is stored within the Stores warehouse within the Kitchener Operations Facility (KOF), as well as some larger items being stored outside in the yard. A comprehensive audit of the Stores function was completed in 2008 prior to the move to the KOF. Two follow-up audits were conducted in 2010 and 2012 respectively. It has now been 13 years since the move to the KOF and various changes in management and staffing have occurred throughout this time. In addition, several process, systems and layout improvements have been made. Internal Audit recommended conducting a comprehensive review of the function again at this time in order to document the changes, test current controls and identify any further areas for improvement. Audit Objective The overall goal of this review is to analyze the Stores function to ensure adequate controls are in place to protect assets and to ensure operations are as effective and efficient as possible. Scope The following areas are within scope for this review: Physical layout and access controls Receiving and disbursement processes Inventory count procedures The following areas are out of scope for this audit: Lean review of aggregate and salt management processes (being covered in a separate review) Execution of any of the recommendations Methodology The following activities were undertaken to complete this review: Review of past audit findings and recommendations Staff and stakeholder interviews and/or surveys to gather opinions on strengths, weaknesses, risks and areas for improvement Review of inventory write-offs Tour of the Stores warehouse Review of warehouse access controls Review of standard operating procedures Participation in annual physical inventory count and review of count procedures Findings Stores staff provide great customer service including a quick response time to fill orders. The team works well together and through cross-training are able to cover for each other during absences. Staff and management have a continuous improvement mindset. A total of 52 standard operating procedures (SOPs) or work process instructions were reviewed, falling broadly into the categories of ordering, receiving, issuing, scrapping and counting inventory. These have not been updated since 2018 and some may be outdated. While the SOPs / work instructions were generally straightforward and controls are in place, there were four processes identified where controls could be improved. During the pandemic the following processes were implemented out of necessity: Online ordering with supervisor approval, which replaced lining up and ordering in person at the counters Delineated restricted access area by the receiving doors, which instructed visitors to not to cross the line into the staff area Orders picked throughout the day and night shifts and placed on shelving outside counter for touch-free pick-up Limiting quantity of certain items, such as COVID personal protective equipment (PPE), to ensure supply for all divisions Staff noted that the new online order system has decreased time spent waiting in line, decreased time spent talking with internal customers, provided more time for staff to pick orders, and the quantity ordered has decreased now that supervisors must approve (which could indicate theft or misuse previously). Internal customers were divided on whether they liked the new order system or not, citing that it took them more time to get supervisor approval and made getting last minute orders impossible. Recommendations have been made to examine this process further to strike a balance between controls and customer service once the pandemic is over. A tour of the warehouse revealed that significant improvements have been made to the layout over the last year in order to make finding parts and filling orders more efficient. Stock is laid out to be close to the relevant counter (i.e., Fleet or Utilities/Operations counters). High moving items and tools for loan are located close to the counter. Slow moving stock has been moved against one wall. The most significant improvement was moving large racking out of the back room into the main warehouse. Racking can only be accessed with a forklift due to its height but the back room did not have doors large enough for a forklift to fit through, so it was essentially wasted space. The large racking was swapped for smaller shelving which now houses COVID PPE, some tools, and shovels and rakes. The doors can be locked after hours to prevent theft of the N95 masks or any other high-risk items that Stores feel should be further protected. During a tour of the warehouse all access points were examined to determine how secure the area is and whether non-Stores staff could access the area. While most doors are secured with key card access, there are a few doors which are always open and would allow access into Stores at any time. It is unlikely and rare that unauthorized staff enter the Stores area during business hours when Stores staff are present. The risk of theft during this time is much lower. However, access after hours when Stores staff are not present is a concern. Recommendations have been made to secure all doors after hours. A review of which staff have card access to Stores also revealed 205 unique employee names with access to at least one of the Stores doors. Through discussions with Security and Stores management, these have been classified into those that should have access and those that have no business need to enter Stores on their own. Security management will remove unnecessary access. A report was run to see who had accessed Stores during the past 6 months with their access card, to identify anyone with no business need to access the area. There were 53 people who tried to access Stores, 23 of whom were denied access (some of them multiple times). Of the remaining 30 staff, only 1 was identified as not needing access, and was likely related to assisting with a technology issue. In future all TIS visits will be by appointment only and staff will be escorted by Stores staff. While the review of access cards did not reveal any blatant unauthorized access, there is the opportunity through the unlocked doors, particularly after hours when Stores staff are not present, for any staff to come into the Stores area. There are no security cameras on this area so it would be impossible to verify if this is happening. However, in a review of all adjustments or write-offs made during the past year there are also not any large or recurring variances of common household product that would indicate unauthorized entry and theft. Recommendations Specific recommendations were shared with management which focus on providing a better customer experience for internal customers while ensuring controls are adequate to protect the stock. There are also recommendations to update all standard operating procedures and to more fully understand the process of sign shop inventory. Conclusion This audit of Stores Inventory has documented a number of positive changes to the Stores layout, processes, and controls. Staff have high job satisfaction and customers are generally satisfied with the service provided. The analysis did not uncover any proven fraudulent activity, but has highlighted the need for tighter access controls and management oversight of what is being ordered. Recommendations in this report focus on stronger controls and better customer experiences. A status update will be conducted after one year from the date of this report. 3. Physical Inventory Count Verification Completed: November 9, 2021 Overview As noted above, the Procurement-Stores section of the Financial Operations division is responsible for the receipt, storage, and disbursement of a variety of physical inventory used in City operations. This inventory is stored within the Stores warehouse within the Kitchener Operations Facility (KOF), as well as some larger items being stored outside in the yard. (e.g., large pipe, catch basins, aggregates, salt) Stores staff perform an annual inventory of all parts and materials to ensure that financial records match the amounts on hand. Internal audit then counts a sample of parts to provide assurance that staff counts are accurate. This is a standard audit activity. Definitions Controllable stock-stock which the Storesstaff have direct control over with regards to purchases and usage. Located within the warehouse. Floor-to-sheet audit randomly selecting parts in the warehouse, counting them, and comparing the quantity to what is in the financial system (SAP). Sheet-to-floor audit pre-selecting parts based on unit value or total value, counting them, and comparing the quantity to what is in SAP. This includes both warehouse and outdoor inventory. Shrinkage rate the percentage of total inventory purchases that are written-down or lost due to factors such as theft, error, fraud, or damage. Uncontrollable stock - stock which is located in the KOF yard which are not under direct supervision by the Stores division. Write-down - the quantity on hand was less than what was recorded in SAP and therefore the financial records were decreased to match the physical quantity. Usually occurs when inventory is used without updating SAP. Write-up the quantity on hand was more than what was recorded in SAP and therefore the financial records were increased to match the physical quantity. Usually occurs due to keying errors when setting up or relieving inventory, or when the wrong unit of measure was used (e.g., number of cartons counted instead of individual parts). Audit Process and Findings Standard floor-to-sheet and sheet-to-floor audits were done to confirm the physical quantity of parts on hand compared to what staff had counted. The audit covered 19% of the total value of inventory. The sheet-to-floor audits covered the top 25 unit values and top 25 total values. The floor-to-sheet audits consisted of 20 random shelf locations. Eleven variances, which equates to 16% of the sample, were found through this verification process which resulted in a $21,133 write-down. This is higher than normal but is still considered a very low value of variances found through the audit process. It represents 0.6% of total inventory on hand. Total Adjustments In2021 the total adjustments for the year to date (up to November 8) were $141,271 write- down. This is a typical total write-down. Usually the total adjustments are a write-down between $50,000 - $200,000. 2020 was an anomaly due to the aggregates not being adjusted and written off. Year 2019 2020 2021 Total write-up ($46,450) $65,803 ($141,271) (down) The 2021 total write-down represents 1.4% of the total inventory purchases for the year to date of $10.5 million.Industry standards indicate that up to 2.5% is an acceptable shrinkage rate. The ending inventory balance was $3,318,820. Controllable Stock Adjustments Of the 2021 adjustments, $14,042 write-up was from controllable stock. This is a lower adjustment than the previous two years and typical. The previous two years had unusual one- time errors driving the higher adjustment. (Note that positive numbers represent write-ups.) Year 2019 2020 2021 Controllable stock write-up $50,500 $59,675 $14,042 Uncontrollable Stock Adjustments The remaining $155,313 of write-down is related to stock which is outside in the KOF yard which are not under direct supervision by Stores staff. It is impractical to have dedicated staff monitoring the outdoor inventory on a 24/7 basis and therefore there is a reliance on staff to inform Stores when they take inventory from the yard. However, this often does not happen. $114K of the write-down is related to road building and maintenance supplies (e.g., asphalt, gravel, salt). This has been a long-standing issue with a lack of process to use of the weigh scale to measure and relieve inventory when aggregates are used. A recent review of the aggregates process has led to several recommendations which will improve the accuracy of the inventory balances once implemented. In the meantime, adjustments continue to get made during the physical inventory when staff estimate the quantity on hand by measuring the size and shape of the piles of aggregates or salt. The adjustments for uncontrollable stock included the following: (Note that positive numbers represent write-ups and negative numbers represent write-downs.) Material Group201920202021 MANHOLES & CATCHBASINS ACCESSORIES AND PARTS (12,065.38) 2,957.77 (21,153.22) PIPE&TUBING (INCL FITTINGS) GAS 6,861.99 (402.26) (17,549.60) ROAD BUILDING MATERIALS (ASPHALTIC) (23,284.14) (6,167.06) ROAD BUILDING MATERIALS (NON-ASPHALTIC) (9,040.64) 247.44 (34,674.74) ROAD MAINTENANCE & SUPPLIES (I.E. SALT, PAINT, ETC.) (40,532.98) 3,616.29 (73,457.63) All other categories (18,611.92) (2,570.10) (2,311.11) Subtotal Non-controllable Inventory (96,673.07) 3,849.14 (155,313.36) Overall, the physical inventory process is in control and no concerns were identified. The adjustments to controllable stock are small write-ups. Uncontrollable stock adjustments are typical and are expected given the current uncontrolled environment. 4. Overtime and On-call Pay - Status Update Original Audit Completed: July 20, 2020 Status Update Completed: October 12, 2021 Overview: The objective of the original audit was to ensure that staff are being properly compensated for additional work outside of their normal working hours in a fair and consistent manner and that staff are not circumventing the rules set out in policies and collective agreements. The objectives of this audit were to assess: Compliance with overtime policies and collective agreements Adequacy of oversight, authorization levels, and controls for approval of overtime Financial impact by operating area On-call practices across the corporation The analysis did not uncover any fraudulent activity but did highlight the need for more robust and consistent methods for attendance management in order to facilitate more fulsome audit and oversight. In addition, the main dissatisfaction by staff was the lack of additional compensation for management overtime and on-call responsibilities. Recommendations focused on exploring new policies and processes and providing communication reminders to management and staff. Audit Objective: All services which have undergone an audit in the past are subject to a status update, not sooner than one year following the original audit. The purpose of status updates are to hold staff accountable for addressing the audit findings and to identify any areas that have not seen significant progress. Status Definitions: Complete = the recommendation has been fully implemented. In progress = implementation has begun. Not started = No work has begun yet but will in the future. Not required = the recommendation either does not require any action, or it is no longer relevant and no work will be done to implement it. Recommendation Status: Status Number of recommendations Number of original recommendations 16 Number of recommendations complete 1 Number of recommendations in progress 5 Number of recommendations not started 9 Number of recommendations not required 1 Most of the recommendations have not been started yet due to resource constraints within Human Resources during the pandemic. Work was done to communicate to all supervisors regarding when to use various overtime codes when reporting overtime. Work is underway to create a consistent process to monitor vacation balances and to investigate the Attendance Management module within Peoplesoft. TIS has also reviewed their processes in order to decrease workload in certain positions and reduce the requirement for overtime in that division. Conclusion: In order to ensure the findings are addressed in the future, Internal Audit will continue to check in on the status once operations stabilize and the corporation enters into recovery phases of the pandemic. 5. Technology Hardware Inventory Status Update Original Audit Completed: November 19, 2020 Status Update Completed: December 9, 2021 Overview: The overall goal of the original audit was to ensure that the technology hardware physical inventory is adequately safeguarded from theft. The objectives of this audit were to assess: Whether technology inventory on hand matches the tracking database Security of inventory location Reconciliation between financial records and the tracking database The analysis did not uncover any fraudulent activity, but did highlight the need for tighter access controls and financial reconciliation of receipt of goods in order to prevent theft. Recommendations focused on stronger controls. Audit Objective: All services which have undergone an audit in the past are subject to a status update, not sooner than one year following the original audit. The purpose of status updates are to hold staff accountable for addressing the audit findings and to identify any areas that have not seen significant progress. Status Definitions: Complete = the recommendation has been fully implemented. In progress = implementation has begun. Not started = No work has begun yet but will in the future. Not required = the recommendation either does not require any action, or it is no longer relevant and no work will be done to implement it. Recommendation Status: Status Number of recommendations Number of original recommendations 7 Number of recommendations complete 3 Number of recommendations in progress 1 Number of recommendations not started 2 Number of recommendations not required 1 Access control was addressed immediately to limit access to the hardware inventory. Work is underway to establish a financial monitoring and reconciliation process. The recommended full inventory of assets deployed in the field has not occurred yet due to the pandemic but will be planned once all staff return to the office. Based on the outcome of that initial audit, a decision will be made whether annual field audits are required or not. Conclusion: Actions taken (or in progress) have reduced the risk of theft. This topic will be added to the rotating list of controls audits. 6. Print Shop Service Delivery Review Completed: December 15, 2021 Background: The City of Kitchener provides in-house printing services from the Print Shop which is located on the ground floor of City Hall. It is staffed by two FTEs who report to the Manager, Digital Media and Creative Services in the Corporate Communications and Marketing division, Corporate Services department. The Print Shop offers the following services to staff and affiliated groups: black and white printing, colour printing, laminating, spiral binding, cutting, folding, hole punching, stapling, padding, and supply of copier paper. The Print Shop operates one colour and two black and white production printers which are capable of hole punching, stapling, and padding. There are separate machines to handle cutting, folding, binding, and laminating. All equipment except the main printers are past their expected useful life. However, all are functional. Over $1 million in capital funding is forecasted for the print shop equipment replacement over the next 10 years. With continued transition to digital (i.e., council reports, etc.) and an increased focus on environmental sustainability, it is expected that demand for print shop services will continue to decrease. A formal value for money analysis was requested and completed to determine whether projected demand justifies the capital investment. There is also a timing window to pursue this work before existing equipment reaches the end of its useful life. Review Objectives The overall goal of this review is to analyze the cost of print services and determine the most cost-effective service delivery model. Scope The following areas are within scope for this review: Future demand for print services The cost and timing of equipment replacement Alternative service delivery options such as outsourcing and hybrid outsourcing / in- house delivery The following areas are out of scope for this audit: Lean review of existing print services processes Recommendations for alternative use of the print shop space Recommendations for alternative deployment of staff Execution of any of the recommendations Methodology The following activities were undertaken to complete this review: Review of current print services, volumes and cost of service, including: o volume data from the online order system o data collected for the e-genda (electronic agenda management) business case o impact on service during the pandemic and re-deployment of staff o survey of directors on extent of outside print services utilized o print volume related to Planning Division public letters / notices Prepared future print services demand projections based on known service requirements, such as new Development Services postcards, and known service improvements, such as e-genda 360 Determined which equipment is required to serve future demand Analyzed remaining useful life of existing equipment and researched the cost and timing of replacement Analyzed service delivery options to recommend the most cost-effective model; this includes looking at status quo, equipment replacement, outsourcing, and a hybrid of outsourcing / in-house delivery. Implementation plan including labour relations implications, if any. Analysis: The cost per impression (page) and the total cost over the next five years has been analyzed for five different alternatives: 1. Outsource all printing 2. Status quo / do nothing 3. Hybrid approach purchase new main print equipment but outsource all ancillary services 4. Replace the print shop equipment purchase 5. Replace the print shop equipment lease Approved Alternative: That the Print Shop be decommissioned, and all work outsourced. This includes the following: Re-deployment of two staff (or severance should there not be suitable positions available ) Auction of existing print equipment RFQ (request for quotations) for printing services Transfer of copier paper supply to Stores Transfer of print budgets from the print shop to divisional budgets based on past usage and estimated outsourcing costs And that all savings realized by this direction, be retained by Corporate Communications & Marketing (CC&M) to partially address structural deficits within print publication advertising, traditionally offset by print shop revenues. The average negative variance in CC&M revenue from 2016-2019 is $70,400 per year. The average print shop savings, after outsourcing and severance costs, is estimated to be $64,000 per year. This will still leave CC&M with a budget shortfall which should be addressed through the budget process. Summary of Key Metrics: Forecast of number of impressions and print jobs for the next 5 years Cost per Impression 2022 2023 2024 2025 Outsource 0.078 0.082 0.087 0.095 Do Nothing 0.142 0.167 0.203 0.263 Replace equipment - Purchase 0.175 0.206 0.251 0.327 Hybrid 0.177 0.206 0.251 0.324 Replace equipment -Lease 0.178 0.209 0.256 0.333 Total Cost Over 5 Years Option Total Cost Outsource 1,147,738 Do Nothing 1,470,004 Hybrid 1,905,794 Replace - purchase 1,921,126 Replace - lease 1,964,098 Conclusion The best course of action is to close the Print Shop, and outsource all work. The cost per impression is half the cost of any of the other options, even with factoring in severance costs. The City would save $322K over the next five years compared to the current operational model. Print volumes are declining and will continue to decline over time and therefore it does not make financial sense to invest further in this service. Multi-function fleet copiers throughout the corporation provide an efficient and effective solution for timely day-to-day black and white and colour printing which are able to provide reliable data regarding costs for accountability and monitoring. In addition, outsourcing will bring awareness to staff of the true cost of printing which may further decrease the volumes printed, leading to positive environmental impacts. Outsourced services can provide timely turnaround, quality printing, ancillary services, and can provide control over visual identity through the terms of the contract. Currently the print shop equipment has reliability issues. There is a risk to continuity of operations should the equipment fail or staff be unavailable. Outsourcing will mitigate this risk. Staffing changes associated with the closure of the print shop will be managed consistent with the provision of the applicable collective agreement. Implementation Plan To implement this recommendation, the following actions will be completed by management: RFQs for print services Transition management of photocopy paper to Stores Adjust divisional budgets to receive printing charges based on past usage and estimated outsourcing costs Notify all staff about changes to print services and the new process to obtain copier paper Auction existing print equipment STRATEGIC PLAN ALIGNMENT: This report supports the delivery of core services. FINANCIAL IMPLICATIONS: Capital Budget The recommendation has no impact on the Capital Budget. Operating Budget The recommendation has no impact on the Operating Budget. COMMUNITY ENGAGEMENT: INFORM council / committee meeting. PREVIOUS REPORTS/AUTHORITIES: CAO-20-007: 2021 Internal Audit Work Plan APPROVED BY: Dan Chapman, CAO ATTACHMENTS: th Attachment A 4 Quarter Audit Status Report presentation