2023 Audit Committee accomplishments
My name is Audie Chang, a member of the Foster City Audit Committee. I have been asked to prepare and present a report on the Audit Committee’s accomplishments in the calendar year 2023. The other members of the Audit Committee are Michael Barry, Bob Buyers, Falgoon Desai and Vijay Dodd.
Selection of Independent Auditors
In addition to its regular meetings, the Audit Committee held two special meetings in February and March 2023, to help select a CPA firm to be Foster City’s independent Auditors. In January 2023, the Finance Staff issued a request for proposal (RFP) and directly contacted seven qualified CPA firms, in addition to posting the RFP on Foster City’s and California Society of Municipal Finance Officer’s (CSMFO) website. Audit proposals were submitted by five CPA firms. The Committee, together with the Finance Staff, reviewed, evaluated, and ranked the proposals for competency, experience, cost, and size of each firm. After detailed discussions, the Committee decided to invite two finalist firms to be interviewed publicly. Following the interviews, the Committee recommended Badawi & Associates to the City Council to be selected as Foster City’s Independent Auditors for fiscal years ending June 2023, 2024, and 2025. It should be noted that Finance staff member Waqas Hassan was especially helpful in contacting qualified CPA firms, gathering the necessary information, and supporting the review process in a very professional manner.
Audit Plan Discussion
The Committee began the first regular meeting of the year in April by discussing the audit plan submitted by Badawi & Associates for the fiscal year ending June 2023. This included a review of the scope and objectives of the audit, background of auditors assigned to the audit, as well as the identification of high-risk areas that would require special attention. The Committee noted that extra work and support from the Finance staff would be necessary as this is the first year Badawi & Associates has taken over the audit from Foster City’s previous auditors, Maze and Associates.
Review of Completed Audit
In November 2023, the Committee reviewed the draft audit report and financial statements presented by the Independent Auditors. The report included findings on the City's operating results, financial position, compliance with applicable laws and regulations, and the effectiveness of internal controls. The Committee noted Foster City received a clean audit opinion with no material weaknesses and recommended the audit report and financial statements be approved by the City Council. The Committee and Independent Auditors commended the City’s finance team for their diligent work and effective management of the City's financial resources.
Below is a summary of documents reviewed during the calendar year 2023.
Financial Matter Finding and Recommendations
FY 2022-23 Foster City/Estero
Municipal Improvement District
Draft ACFR
As per the auditors’ recommendation, the City/District
recorded certain prior period adjustments which the
Committee reviewed and confirmed.
Measure A Report None Noted
Measure W Report None Noted
FY 2023-24 Appropriations Limit None Noted
Report on Internal Control over
Financial Reporting and on
Compliance and Other Matters
No material weakness noted.
Auditor’s Communication with
Those Charged with Governance
No adjustment was recorded.
Mission Statement
The Committee determined the existing mission statement continues to be valid, that is: “To provide insights, advice and support into audit, governance, and other relevant fiscal matters appropriate to the oversight, operational and fiduciary responsibilities of the City Council and the Estero Municipal Improvement District Board of Directors.” Calendar Year 2024 Goals
The goals for 2024 were updated as follows: “The Committee shall continue to seek input and requests for areas of interests to work on from the City Council. In calendar year 2024, the Committee shall review the year’s annual audit process and the City’s draft financial statements for fiscal year ending 2024, and recommend, if any, a directed study to be performed by the Independent Auditors ancillary to their audit”.
Conclusion
In conclusion, the Audit Committee had a productive year which included two special meetings to help select Foster City’s independent auditors for the years 2023, 2024 and 2025.
The Committee continues to express confidence in the Fnance team's competency and efforts to manage the City's finances and accounting effectively and transparently and looks forward to continuing its oversight role in the future.
I would also like to thank the City's finance team, in particular, Director Edmund Suen and Assistant Director Waqas Hassan, for their support of the Committee’s work on behalf of Foster City.