HomeMy WebLinkAboutOrdinance 004 - Internal Auditor AmendmentsDeschutes County Board of Commissioners
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AGENDA REQUEST & STAFF REPORT
For Board Business Meeting of 117/2013
DATE: 12-18-12
FROM: David Givans Administrative Services -Internal Audit 330-4674
TITLE OF AGENDA ITEM:
Second reading of Ordinance No 2013-004. An ordinance amending Chapter 2.14 (County Internal
Auditor) and Chapter 2.15 (County Audit Committee) as proposed by the County audit committee.
PUBLIC HEARING ON THIS DATE? No
BACKGROUND AND POLICY IMPLICATIONS:
The changes being proposed came through recommendations from a peer review of the internal audit
program, discussions with the audit committee, work sessions with the Board of County Commissioners
and Legal Counsel review.
The ordinance amends Chapter 2.14 (County Internal Auditor) to clarify and improve some of the
language. The area most significantly changed is in the area of appointment and dismissal of the
County Internal Auditor. The revisions clarify the involvement of the Board of County Commissioners
and the public members ofthe Audit Committee during appointment and dismissal. An affirming
majority vote of the Board of County Commissioners will now be necessary to dismiss or appoint the
County Internal Auditor. These changes are in better alignment with internal audit industry best
practices, which provide for improved independence of the County Internal Auditor. Some additional
edits identified during the code review were included.
The ordinance amends Chapter 2.15 (County Audit Committee) to provide similar language as
modified in Chapter 2.14 regarding the audit committee's consultation during appointment and
dismissal. It also provides for input for the performance review of the County Internal Auditor.
The audit committee supports these changes and the changes have also been reviewed the County
Internal Auditor.
FISCAL IMPLICATIONS:
None noted
RECOMMENDATION & ACTION REQUESTED:
Second reading of ordinance No. 2011-004.
ATTENDANCE: David Givans, County Internal Auditor
DISTRIBUTION OF DOCUMENTS:
David Givans, County Internal Auditor
1/1
For Recording Stamp Only
BEFORE THE BOARD OF COUNfY COMMISSIONERS OF DESCHUTES COUNfY, OREGON
An Ordinance Amending Chapter 2.14, County ...
Internal Auditor and Chapter 2.15, Audit Committee, ... ORDINANCE NO. 2013-004
of the Deschutes County Code. ...
WHEREAS the Board of County Commissioners by Deschutes County Code, Chapter 2.14 and
Chapter 2.1 5 codified the County Internal Auditor and Audit Committee roles with the County and the
Audit Committee code specifically calls for the routine review of Chapter 2.15; and
WHEREAS the Audit Committee through a review of Chapters 2.14 and 2.15 developed and
recommends the amendments attached in Exhibit A and Exhibit B to Chapter 2.14 and 2.15,
respectively; now, therefore:
THE BOARD OF COUNTY COMMISSIONERS OF DESCHUTES COUNTY, OREGON,
ORDAINS as follows:
Section L AMENDING CHAPTER 2.14. The Deschutes County Code is amended by
incorporating the revised verbiage of Chapter 2.14, County Internal Auditor, set forth in Exhibit "A"
attached hereto and by this reference incorporated herein.
Section L AMENDING CHAPTER 2.15. The Deschutes County Code is amended by
incorporating the revised verbiage of Chapter 2.15, County Audit Committee, set forth in Exhibit "B"
attached hereto and by this reference incorporated herein.
PAGE 1 OF 2 -ORDINANCE NO. 2013-004 (l/13)
BOARD OF COUNTY COMMISSIONERS Dated this ___of ____, 2012
OF DESCHUTES COUNTY, OREGON
ANTHONY DEBONE, Chair
ALAN UNGER, Vice Chair
ATIEST:
Recording Secretary TAMMY BANEY, COMMISSIONER
Date of 1st Reading: 11~ day of ~,2012.
Date of 2 nd Reading: __day _____, 2013.
Record of Adoption Vote
Commissioner
Anthony De Bone
Alan Unger
Tammy Baney
Yes No Abstained Excused
Effective date: __day _____,2013.
ATIEST:
Recording Secretary
PAGE 2 OF 2 -ORDINANCE NO. 2013-004 (1/13)
EXHmIT ~~A"
Chapter 2.14. COUNTY INTERNAL AUDITOR
2.14.010. Appointment of County Internal Auditor.
2.14.020. Qualifications of County Internal Auditor.
2.14.030 Scope of Audits.
2.14.040. Internal Audit Schedule.
2.14.050. Funding.
2.14.060. Access to Employees, Records and Property.
2.14.070. Audit Reporting and Records.
2.14.080. Contract Auditors, Consultants and Experts.
2.14.090. Quality Assurance Review.
2.14.010. Appointment or dismissal of County Internal Auditor.
The County Internal Auditor shall be appointed by or dismissed by the County Administrator in consultation
with a majority ofthe public members of the Audit Committee and an affIrming majority vote of the BOCC.
2.14.020. Qualifications of County Internal Auditor.
The County Internal Auditor shall possess adequate professional proficiency, demonstrated by relevant
certification, such as CPA (Certified Public Accountant), CIA (Certified Internal Auditor), CGAP (Certified
Government Auditing Professional) or a combination of education and experience as would be desired by the
County.
2.14.030 Scope of Audits.
1. The County Internal Auditor shall conduct work in accordance with government auditing standards and
county policies. The County Internal Auditor shall establish internal auditing policies and procedures to
assure that audit work is completed in accordance with those standards. Any audit work that is undertaken
not in compliance with standards shall be disclosed in the County Internal Auditor's report.
2. The County Internal Auditor shall have authority to conduct fmanciaI, attestation, and performance audits
of all departments, offices, boards, activities and agencies of the County in order to independently and
objectively determine whether:
a. activities and programs being implemented have been authorized by County Code or adopted
policy, state law or applicable federal law or regulations;
b. activities and programs are being conducted as prescribed by management/governing body to
accomplish the objectives intended by County Code, state law or applicable federal law or
regulations;
c. activities or programs efficiently and effectively serve the purpose intended by County Code, slale
law or applicable federal law or regulations;
d. activities and programs are being conducted and funds expended in compliance with applicable
laws;
Exhibit "A" to Ordinance No. 2013-004 (1/13)
Chapter 2.14 (1/13)
e. revenues are being properly collected, deposited ~d accounted for;
f. resources, including funds, property and personnel, are adequately safeguarded, controlled and
used in an effective and efficient manner;
g. fmancial and other reports are being provided that disclose fairly and fully all information that is
required by law, that is necessary to ascertain the nature and scope of programs and activities and
that is necessary to establish a proper basis for evaluating the programs and activities;
h. there are adequate operating and administrative procedures and practices, systems or accounting
internal control systems and internal management controls which have been established by
management; and
1. there are indications of fraud, abuse or illegal acts, which need further investigation.
3. The County Internal Auditor may also provide non-audit services (consulting) that are not covered by
governmental auditing standards. Non-audit services differ from audits in that the County Internal
Auditors may
a. Perform tasks requested by management that directly support the entity's operations;
b. Provide information or data to a requesting party without providing verification, analysis or
evaluation.
These non-audit services should be approved by the County Administrator. The County Internal Auditor
should continue to work independently (in fact and appearance) when performing non-audit services. The
County Internal Auditor will decide and advise the County Administrator if the non-audit work may
jeopardize independence and whether the work should be performed.
I
4. The County Internal Auditor needs to consider three general classes of impairments to independence
personal, external, and organizational. If one or more of these impairments affects the County Internal
Auditor's capability to perform the work and report results impartially, that County Internal Auditor
should either decline to perform the work, or in those situations because of a legislative requirement or for
other reasons, cannot decline to perform the work, should disclose the impairment in their report.
I The County Internal Auditor should not perform management functions or make management decisions.
Performing management functions or making management decisions might impair the County Internal
Auditor's ability to perform audits ofthat or a related subject matter. 1
I
2.14.040. Internal Audit Schedule.
At the beginning of each calendar (or fiscal) year, the County Internal Auditor shall submit a one to five
year audit work schedule to the Audit Committee for approval. This audit work schedule should incorporate 1 information from mUltiple sources including the County Internal Auditor's assessment of significant risks to
the organization and input from Management, Audit Committee, and the Board of County Commissioners.
The schedule shall include the proposed plan for auditing departments, offices, boards, activities,
subcontractors and agencies for the period. The schedule may be amended. Additionally, the County
Internal Auditor (for cause) may spontaneously initiate and conduct any other audit deemed necessary. Any
significant changes (an expectation of scope of work changing by more or less than 150 hours) to the work
plan for audit or non-audit projects should be approved in advance by the County Administrator and, except
in cases of emergency, the Audit Committee.
In the selection of audit areas and audit objectives, the determination of audit scope and the timing of audit
work, the County Internal Auditor should consult with external auditors so that the desirable audit coverage
is provided and audit effort is properly coordinated.
Exhibit "A" to Ordinance No. 2013-004 (1/13)
Chapter 2.14 2 (1/13)
2.14.050. Funding.
The County shall provide sufficient funds to enable the County Internal Auditor to carry out the
responsibilities specified herein subject to annual appropriation by the BOCC.
2.14.060. Access to Employees, Records and Property.
1. All officers and employees of Deschutes County shall furnish the County Internal Auditor with
unrestricted access to employees, information and records (including electronic/computerized data)
within their custody regarding powers, duties, activities, organization, property, financial transactions,
contracts and methods of business required to conduct an audit or otherwise perform audit duties. In
addition, they shall provide access for the County Internal Auditor to inspect all property, equipment
and facilities within their custody. A discussion of appropriate access should occur with County
Counsel if access to documents is restricted by applicable law.
2. Further, all contracts with outside contractors and subcontractors shall provide the County Internal Auditor
access to the contractually related financial and performance-related records; property, equipment and
services purchased in whole, or in part, with governmental funds
3. If such officers, employees or contractors fail to produce the aforementioned access and/or information,
the County Internal Auditor with the aide of County Legal Counsel may initiate a search (or obtain a
subpoena) to obtain exhibit copies (physical or electronic) from computerized systems, book, paper or
record of any such official or employee, or outside contractor or subcontractor, in accordance with state
law or the applicable contract.
4. Subject to public records laws, the County Internal Auditor shall not publicly disclose any information
received during an audit that is considered confidential by any local, state or federal law or regulation. The
County Internal Auditor shall maintain the confidential status of information and records furnished by
County officers and employees.
2.14.070. Audit Reporting and Records.
1. Each audit will result in a report containing relevant background information and findings and
recommendations, and shall communicate results to the Board of County Commissioners, Audit
Committee, and appropriate management. Subject to applicable public records laws, the report shall
also be available for public examination. If certain pertinent information is prohibited from general
disclosure, the audit report should state the nature of the information omitted and the requirement that
makes the omission necessary.
2. The County Internal Auditor should follow state archive guidelines as appropriate and as identified
under OAR 166-150-0005(4) (currently - a retention schedule of 10 years).
3. The County Internal Auditor should periodically report to the Audit Committee (and Board of County
Commissioners) on the work performed and any significant findings, which have not been fully
addressed by management.
4. The County Internal Auditor shall follow-up on audit recommendations, as practical, to determine if
management is implementing corrective action as identified in their response to the audit report
findings and recommendations. The County Internal Auditor may request periodic status reports from
auditees regarding actions taken to address reported deficiencies and audit recommendations.
I
I
1
Exhibit "A" to Ordinance No. 2013-004 (1/13)
Chapter 2.14 3 (I/13)I
1
2.14.80.Contract auditors, consultants and Experts.
1. Within budget limitations and approval by the County Administrator, the County Internal Auditor may
obtain the services of Certified Public Accountants, qualified management consultants, or other
professional experts necessary to perform auditor duties. An audit that is performed by contract must be
conducted by persons who are independent of the governmental unit and its officers. The County
Internal Auditor will coordinate and monitor auditing performed by public accounting, professional
experts, or other organizations employed under contract by Deschutes County.
2. The County Internal Auditor may participate with the Audit Committee in the selection of qualified
fmalists for the provider of Deschutes County's annual fmancial audit. The Audit Committee shall
select a provider from the finalists. This selection shall be presented to the Board of County
Commissioners for review and approvaL The process will follow Deschutes County's contracting
processes.
2.14.090. Quality Assurance Reviews.
I. The audit activities of the County Internal Auditor's office shall be subject to quality review in
accordance with applicable government auditing standards by a professional, non-partisan objective
group (such as the Association of Local Government Auditors (ALGA)). A copy ofthe written report of
this independent review shall be furnished to the Audit Committee and the Board of County
Commissioners. This report shall be available to the public.
2. The quality control review shall determine compliance with government auditing standards and the
quality of the audit effort and reporting, including:
a. general standards such as competence, professional judgment, and quality assurance;
b. fieldwork standards such as planning, supervision, and evidence; and
c. reporting standards such as report content, timeliness and distribution.
3. The County shall reimburse the costs of the quality control review team from funds budgeted in the
County Internal Auditor's budget. Within available time constraints, the County Internal Auditor may
reciprocate with other organizations by participation in quality control teams.
(Ord. 2011-004, Ord. 2005-014 §1, 2005)
Exhibit "A" to Ordinance No. 2013-004 (1113)
Chapter 2.14 4 (1/13)
EXHmIT"B"
Chapter 2.15. COUNTY AUDIT COMMITTEE
2.15.010 Authority.
2.15.020. Composition.
2.15.030 Meetings.
2.15.040. Responsibilities.
2.15.010. Authority.
A. The Board of County Commissioners ("Board") hereby establishes the Audit Committee as an advisory
committee. The committee shall advise the Board and County Administrator on significant audit matters
including, but not limited to:
1. The selection, compensation, and removal of external auditors hired to audit the financial statements for
the County and its related entities;
2. Consultation with the County Administrator or Board regarding the appointment or dismissal of the
County Internal Auditor should include a consultation with a majority of the public members of the audit
committee;
3. Increases and decreases to the requested budget for the internal audit program; and
4. The work plan for internal audits performed under DCC 2.14.040.
2.15.020. Composition.
A. The audit committee shall be comprised of not less than seven or more than nine members appointed by the
Board.
B. Each member shall be appointed to serve a term of two years. Upon initial formation of the committee, the
Board may appoint any member to a shorter term. A member may be appointed to more than one term. The
Board may remove a member of the committee at any time. In the event of a vacancy on the committee the
Board shall, as soon as practicable, appoint a person to serve the unexpired portion of the former member's
term.
C. The committee shall consist of one (1) member county commissioner, two (2) county department head
members, and four (4) to six (6) public members. The County Administrator shall be an ex-officio nonvoting
member.
D. A public member shall be a registered voter within Deschutes County. The chair of the committee shall be a
public member and shall be selected by a majority of the public members. The chair shall serve a one-year
term and may be selected for additional terms. If the public members cannot decide upon a chair, the larger
committee shall decide. The chair shall preside over meetings, as well as provide input on topics for the
agenda.
2.15.030 Meetings
A. The audit committee shall meet as the committee deems necessary. A quorum shall constitute a majority of
the members appointed. Vacant positions shall not be considered in determining whether a quorum exists.
Minutes shall be prepared in accordance with the Oregon Public Meeting Law. The committee may require
certain County management attend meetings to address reports being discussed. Auditee departments will be
invited to meetings where their internal audit report is discussed.
Exhibit "B" to Ordinance No. 2013-004 (1/13)
Chapter 2.15 (1/13)
B. A department head audit committee member shall not vote on an issue relating to an audit directly pertaining
to his or her department. If there is any question as to whether audit committee members should recuse
themselves from a vote, the committee should vote to determine whether the member should recuse himself or
herself.
C. The County Internal Auditor shall facilitate and coordinate such meetings, as well as provide ancillary support
to the committee, as time permits.
2.15.040. Responsibilities. Responsibilities of the Audit Committee include:
A. Overseeing the independent audit ofthe County's fmancial statements, including:
1. Overseeing the selection, renewal or removal of the independent external auditor by making a
recommendation to the Board for fmal approval;
2. Meeting with the external auditors during planning of the audit, presentation of the audited fmancial
statements, and discussion of the letter to management on recommendations; and
3. Overseeing the resolution of audit fmdings in, areas such as internal control, legal and regulatory
compliance, and ethics.
B. The committee shall work to assure coordination between the internal and external auditors, management, the
County Administrator and Board.
C. The audit committee shall ensure the internal audit program performs its function. The committee shall:
1. Review the internal audit ordinance (DCC 2.14) at least every other year;
2. Review proposed internal audit work plans and make recommendations concerning internal audit projects;
3. Review the budget and staffing levels of the internal audit program (DCC 2.14.050);
4. Review internal audit reports and other communications developed for the County;
5. Review and provide input on internal audit program goals; and
6. Review any quality assurance reviews created pursuant to DeC 2.14.090.
7. Discuss and provide input on the County Internal Auditor's performance review each year.
D. The committee shall make appropriate recommendations concerning the internal audit program based upon the
reviews that it conducts pursuant to subsection C of this section.
E. The committee shall make an annual report to the Board summarizing the committee's activities and
recommendations. The report may be delivered at an audit committee meeting attended by the Board or may
be scheduled for a regularly scheduled meeting of the Board.
F. The committee shall perform other activities related to this chapter as requested by the Board.
(Ord. 2011-004)
(Ord. 2009-011 §1, 2009)
(Ord.2008-002 §1, 2008)
Exhibit "8" to Ordinance No. 2013-004 (1/13)
Chapter 2.15 2 (1/13)
Chapter 2.14. COUNTY INTERNAL AUDITOR
2.14.010. Appointment of County Internal Auditor.
2.14.020. Qualifications of County Internal Auditor.
2.14.030 Scope of Audits.
2.14.040. Internal Audit Schedule.
2.14.050. Funding.
2.14.060. Access to Employees, Records and Property.
2.14.070. Audit Reporting and Records.
2.14.080. Contract Auditors, Consultants and Experts.
2.14.090. Quality Assurance Review.
2.14.010. Appointment or dismissal of County Internal Auditor.
The County Internal Auditor shall be appointed by or dismissed by the County Administrator in consultation
with a majority ofthe public members of the Audit Committee and an affmning majority vote of the BOCC.
2.14.020. Qualifications of County Internal Auditor.
The County Internal Auditor shall possess adequate professional proficiency, demonstrated by relevant
certification, such as CPA (Certified Public Accountant), CIA (Certified Internal Auditor), CGAP (Certified
Government Auditing Professiorial) or a combination of education and experience as would be desired by the
County.
2.14.030 Scope of Audits.
1. The County Internal Auditor shall conduct work in accordance with government auditing standards and
county policies. The County Internal Auditor shall establish internal auditing policies and procedures to
assure that audit work is completed in accordance with those standards. Any audit work that is undertaken
not in compliance with standards shall be disclosed in the County Internal Auditor's report.
2. The County Internal Auditor shall have authority to conduct fmancial, attestation, and performance audits
of all departments, offices, boards, activities and agencies of the County in order to independently and
objectively determine whether:
a. activities and programs being implemented have been authorized by County Code or adopted
policy, state law or applicable federal law or regulations;
b. activities and programs are being conducted as prescribed by management/governing body to
accomplish the objectives intended by County Code, state law or applicable federal law or
regulations;
c. activities or programs efficiently and effectively serve the purpose intended by County Code, state
law or applicable federal law or regulations;
d. activities and programs are being conducted and funds expended in compliance with applicable
laws;
e. revenues are being properly collected, deposited and accounted for;
Chapter 2.14 (1/13)
f. resources, including funds, property and personnel, are adequately safeguarded, controlled and
used in an effective and efficient manner;
g. financial and other reports are being provided that disclose fairly and fully all information that is
required by law, that is necessary to ascertain the nature and scope of programs and activities and
that is necessary to establish a proper basis for evaluating the programs and activities;
h. there are adequate operating and administrative procedures and practices, systems or accounting
internal control systems and internal management controls which have been established by
management; and
1. there are indications of fraud, abuse or illegal acts, which need further investigation.
3. The County Internal Auditor may also provide non-audit services (consulting) that are not covered by
governmental auditing standards. Non-audit services differ from audits in that the County Internal
Auditors may
a. Perform tasks requested by management that directly support the entity's operations;
b. Provide information or data to a requesting party without providing verification, analysis or
evaluation.
These non-audit services should be approved by the County Administrator. The County Internal Auditor
should continue to work independently (in fact and appearance) when performing non-audit services. The
County Internal Auditor will decide and advise the County Administrator if the non-audit work may
jeopardize independence and whether the work should be performed.
4. The County Internal Auditor needs to consider three general classes of impairments to independence
personal, external, and organizationaL If one or more of these impairments affects the County Internal
Auditor's capability to perform the work and report results impartially, that County Internal Auditor
should either decline to perform the work, or in those situations because of a legislative requirement or for
other reasons, cannot decline to perform the work, should disclose the impairment in their report.
The County Internal Auditor should not perform management functions or make management decisions.
Performing management functions or making management decisions might impair the County Internal
Auditor's ability to perform audits of that or a related subject matter.
2.14.040. Internal Audit Schedule.
At the beginning of each calendar (or fiscal) year, the County Internal Auditor shall submit a one to five
year audit work schedule to the Audit Committee for approval. This audit work schedule should incorporate
information from multiple sources including the County Internal Auditor's assessment of significant risks to
the organization and input from Management, Audit Committee, and the Board of County Commissioners.
The schedule shall include the proposed plan for auditing departments, offices, boards, activities,
subcontractors and agencies for the period. The schedule may be amended. Additionally, the County
Internal Auditor (for cause) may spontaneously initiate and conduct any other audit deemed necessary. Any
significant changes (an expectation of scope of work changing by more or less than 150 hours) to the
workplanwork plan for audit or non-audit projects should be approved in advance by the County
Administrator and, except in cases of emergency, the Audit Committee.
In the selection of audit areas and audit objectives, the determination of audit scope and the timing of audit
work, the County Internal Auditor should consult with external auditors so that the desirable audit coverage
is provided and audit effort is properly coordinated.
Chapter 2.14 2 (1/13)
2.14.050. Funding.
The County shall provide sufficient funds to enable the County Internal Auditor to carry out the
responsibilities specified herein subject to annual appropriation by the BOCC.
2.14.060. Access to Employees, Records and Property.
1. All officers and employees of Deschutes County shall furnish the County Internal Auditor with
unrestricted access to employees, information and records (including electronic/computerized data)
within their custody regarding powers, duties, activities, organization, property, financial transactions,
contracts and methods of business required to conduct an audit or otherwise perform audit duties. In
addition, they shall provide access for the County Internal Auditor to inspect all property, equipment
and facilities within their custody. A discussion of appropriate access should occur with County
Counsel if access to documents is restricted by applicable law.
2. Further, all contracts with outside contractors and subcontractors shall provide the County Internal Auditor
access to the contractually related fmandal and performance-related records; property, equipment and
services purchased in whole, or in part, with governmental funds
3. If such officers, employees or contractors fail to produce the aforementioned access and/or information,
the County Internal Auditor with the aide of County Legal Counsel may initiate a search (or obtain a
subpoena) to obtain exhibit copies (physical or electronic) from computerized systems, book, paper or
record of any such official or employee, or outside contractor or subcontractor, in accordance with state
law or the applicable contract.
4. Subject to public records laws, the County Internal Auditor shall not publicly disclose any information
received during an audit that is considered confidential by any local, state or federal law or regulation. The
County Internal Auditor shall maintain the confidential status of information and records furnished by
County officers and employees.
2.14.070. Audit Reporting and Records.
1. Each audit will result in a report containing relevant background information and findings and
recommendations, and shall communicate results to the Board of County Commissioners, Audit
Committee, and appropriate management. Subject to applicable public records laws, the report shall
also be available for public examination. If certain pertinent information is prohibited from general
disclosure, the audit report should state the nature of the information omitted and the requirement that
makes the omission necessary.
2. The County Internal Auditor should follow state archive guidelines as appropriate and as identified
under OAR 166-150-0005(4) (currently - a retention schedule of 10 years).
3. The County Internal Auditor should periodically report to the Audit Committee (and Board of County
Commissioners) on the work performed and any significant findings, which have not been fully
addressed by management.
4. The County Internal Auditor shall follow-up on audit recommendations, as practical, to determine if
management is implementing corrective action as identified in their response to the audit report
findings and recommendations. The County Internal Auditor may request periodic status reports from
auditees regarding actions taken to address reported deficiencies and audit recommendations.
Chapter 2.14 3 (1/13)
2.14.80.Contract auditors, consultants and Experts.
1. Within budget limitations and approval by the County Administrator, the County Internal Auditor may
obtain the services of Certified Public Accountants, qualified management consultants, or other
professional experts necessary to perform auditor duties. An audit that is performed by contract must be
conducted by persons who are independent of the governmental unit and its officers. The County
Internal Auditor will coordinate and monitor aUditing performed by public accounting, professional
experts, or other organizations employed under contract by Deschutes County.
2. The County Internal Auditor may participate with the Audit Committee in the selection of qualified
finalists for the provider of Deschutes County's annual financial audit. The Audit Committee shall
select a provider from the finalists. This selection shall be presented to the Board of County
Commissioners for review and approval. The process will follow Deschutes County's contracting
processes.
2.14.090. Quality Assurance Reviews.
1. The audit activities of the County Internal Auditor's office shall be subject to quality review in
accordance with applicable government auditing standards by a professional, non-partisan objective
group (such as the Association of Local Government Auditors (ALGA)). A copy of the written report of
this independent review shall be furnished to the Audit Committee and the Board of County
Commissioners. This report shall be available to the public.
2. The quality control review shall determine compliance with government auditing standards and the
quality of the audit effort and reporting, including:
a. general standards such as competence, professional judgment, and quality assurance;
b. fieldwork standards such as planning, supervision, and evidence; and
c. reporting standards such as report content, timeliness and distribution.
3. The County shall reimburse the costs of the quality control review team from funds budgeted in the
County Internal Auditor's budget. Within available time constraints, the County Internal Auditor may
reciprocate with other organizations by participation in quality control teams.
(Ord. 2011-004, Ord. 2005-014 §1, 2005)
Chapter 2.14 4 (1/13)
Chapter 2.15. COUNTY AUDIT COMMITTEE
2.15.010 Authority.
2.15.020. Composition.
2.15.030 Meetings.
2.15.040. Responsibilities.
2.15.010. Authority.
A. The Board of County Commissioners ("Board") hereby establishes the Audit Committee as an advisory
committee. The committee shall advise the Board and County Administrator on significant audit matters
including, but not limited to:
1. The selection, compensation, and removal of external auditors hired to audit the fmancial statements for
the County and its related entities;
2. Consultation with the County Administrator or Board regarding the appointment or dismissal of the
County Internal Auditor should include a consultation with a majority of the public members of the audit
committee;
3. Increases and decreases to the requested budget for the internal audit program; and
4. The work plan for internal audits performed under DCC 2.14.040.
2.15.020. Composition.
A. The audit committee shall be comprised of not less than seven or more than nine members appointed by the
Board.
B. Each member shall be appointed to serve a term of two years. Upon initial formation of the committee, the
Board may appoint any member to a shorter term. A member may be appointed to more than one term. The
Board may remove a member of the committee at any time. In the event of a vacancy on the committee the
Board shall, as soon as practicable, appoint a person to serve the unexpired portion of the former members
term.
C. The committee shall consist of one (1) member county commissioner, two (2) county department head
members, and four (4) to six (6) public members. The County Administrator shall be an ex-officio nonvoting
member.
D. A public member shall be a registered voter within Deschutes County. The chair of the committee shall be a
public member and shall be selected by a majority of the public members. The chair shall serve a one-year
term and may be selected for additional terms. If the public members cannot decide upon a chair, the larger
committee shall decide. The chair shall preside over meetings, as well as provide input on topics for the
agenda.
2.15.030 Meetings
A. The audit committee shall meet as the committee deems necessary. A quorum shall constitute a majority of
the members appointed. Vacant positions shall not be considered in determining whether a quorum exists.
Minutes shall be prepared in accordance with the Oregon Public Meeting Law. The committee may require
certain County management attend meetings to address reports being discussed. Auditee departments will be
invited to meetings where their internal audit report is discussed.
B. A department head audit committee member shall not vote on an issue relating to an audit directly pertaining
to his or her department. If there is any question as to whether audit committee members should recuse
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themselves from a vote, the committee should vote to detennine whether the member should recuse himself or
herself.
C. The County Internal Auditor shall facilitate and coordinate such meetings, as well as provide ancillary support
to the committee, as time permits.
2.15.040. Responsibilities. Responsibilities of the Audit Committee include:
A. Overseeing the independent audit of the County's fmancial statements, including:
I. Overseeing the selection, renewal or removal of the independent external auditor by making a
recommendation to the Board for final approval;
2. Meeting with the external auditors during planning of the audit, presentation of the audited financial
statements, and discussion of the letter to management on recommendations; and
3. Overseeing the resolution of audit findings in, areas such as internal control, legal and regulatory
compliance, and ethics.
B. The committee shall work to assure coordination between the internal and external auditors, management, the
County Administrator and Board.
C. The audit committee shall ensure the internal audit program performs its function. The committee shall:
I. Review the internal audit ordinance (DCC 2.14) at least every other year;
2. Review proposed internal audit work plans and make recommendations concerning internal audit projects;
3. Review the budget and staifmg levels of the internal audit program (DCC 2.14.050);
4. Review internal audit reports and other communications developed for the County;
5. Review and provide input on internal audit program goals; and
6. Review any quality assurance reviews created pursuant to DCC 2.14.090.
7. Discuss and provide input on the County Internal Auditor's performance review each year.
D. The committee shall make appropriate recommendations concerning the internal audit program based upon the
reviews that it conducts pursuant to subsection C of this section.
E. The committee shall make an annual report to the Board summarizing the committee's activities and
recommendations. The report may be delivered at an audit committee meeting attended by the Board or may
be scheduled for a regularly scheduleq meeting of the Board.
F. The committee shall perform other activities related to this chapter as requested by the Board.
(Ord.2011-004)
(Ord.2009-011 §1, 2009)
(Ord. 2008-002 § 1,2008)
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