TO: Rules & Open Government Committee FROM: Joe Rois,
City Auditor
SUBJECT: Monthly Report of Activities for DATE: April 3, 2023 March 2023
RECOMMENDATION
Approve the Auditor’s Office Monthly Report of Activities for the month of March 2023.
SUMMARY OF RESULTS
Charter Section 8.05(e) requires the City Auditor to submit a monthly report to the City Council of our activities, findings, and recommendations. This report summarizes reports issued, other activities, assignments in process, and the status of the City Auditor’s Fiscal Year (FY) 2022-23 Work Plan during the month of March 2023.
Activities During the Month of March:
1. Issued Status of Open Audit Recommendations as of December 31, 2022. The report is online at: https://www.sanjoseca.gov/home/showpublisheddocument/95577.
2. Macias, Gini & O’Connell (MGO) issued another of the City’s annual financial audit projects. The reports are online at: https://www.sanjoseca.gov/yourgovernment/appointees/city-auditor/external-financial-audits.
Information on the status of the City Auditor’s FY 2022-23 Work Plan is attached. On behalf of the Auditor’s Office, I would like to express my appreciation to City staff for their cooperation and assistance during our reviews.
Joe Rois
City Auditor
Attachment
RULES COMMITTEE: 4/12/2023
ITEM: B.4
RULES AND OPEN GOVERNMENT COMMITTEE
Monthly Report of Activities for March 2023
Status of the City Auditor’s FY 2022-23 Audit Work Plan As of March 2023
Objective Status Issuance
Date
Assignments Completed
1. Bill of Rights for Children and
Youth
Review the adherence to and implementation of the Bill of Rights for Children and Youth. (request by Councilmember) Completed August 2022
2. Semi-annual audit
recommendation status reports
Report on the implementation status of all open audit
recommendations as of June 30 and December 31, 2022. Completed September
2022 &
March
2023
3. COVID-19 Recovery
Expenditures
Audit of COVID-19 related expenditures of Coronavirus Relief Fund, American Rescue Plan, or other funding sources. Per Council request, objective of this audit will be to document and review the dispersal of COVID-19 related funds for food distribution for transparency and fiscal accountability.
Completed October
2022
4. Semi-annual compliance review
of the City’s investment
program
(contracted audit service)
The City’s investment policy requires semi-annual compliance audits of the City’s investment portfolio. The City’s outside financial statement auditor, Macias, Gini & O’Connell (MGO), will conduct the agreed-upon procedures as of June 30, 2022.
Completed October
2022
5. Annual performance review of
Team San José and the
Convention and Visitors Bureau
Annual review to determine whether Team San José met their performance metrics as of June 30, 2022. Completed November 2022
6. Tree-related mitigation funds
and cost-effectiveness of tree
planting efforts
An audit of a) how and whether the City is collecting tree-related mitigation fees from developers, b) how and whether the City is enforcing tree-planting conditions on development, c) how the City is spending tree mitigation funds, and d) how the City can most cost-effectively plant more trees. (request by the Mayor and Councilmembers)
Completed November
2022
7. Annual audits of voter-approved
bond and parcel tax measures
(contracted audit service)
MGO will conduct audits of the Branch Library Bond Projects Fund, the Parks and Recreation Bond Projects Fund, the Public Safety Bond Projects Fund, the Library Parcel Tax Fund, and the Public Safety and Infrastructure (“Measure T”) Bond Fund satisfying the City’s obligation for guaranteed annual audits.
Completed
October/
November
2022
8. Firearm Regulatory Processes
and Policies
Audit the City’s firearm regulatory processes and policies, including a review of trends in firearm violence in the city. (request by Councilmember)
Completed December
2022
9. Annual services report 15th annual report providing data about the cost, quality, quantity, and timeliness of City services. The report incorporates existing performance measurement data, showing ten-year historical trends, a variety of comparisons to other cities, and the results of a resident survey. The office will also maintain an online dashboard of CSA dashboard measures.
Completed December
2022
10. Compliance review of San José
Clean Energy’s risk management
practices
(contracted audit service)
MGO will conduct tests of San José Clean Energy (SJCE)
investment and risk management practices to ensure compliance with the City’s Energy Risk Management Policy and Energy Risk Management Regulations as of FY Ended June 30, 2022.
Completed January
2023
11. Annual external financial audit
and single audit
(contracted audit service)
The City Charter requires an annual audit of the City’s financial transactions. MGO will conduct the annual audits of the Annual Comprehensive Financial Reports of the City and the Airport.
MGO will also conduct audits of the financial statements of the Successor Agency to the Redevelopment Agency, Convention Center, Deferred Compensation, Tier 3 Defined Contribution Plan, Voluntary Employee Beneficiary Association, MTC
Completed March
2023
RULES AND OPEN GOVERNMENT COMMITTEE
Monthly Report of Activities for March 2023
Objective Status Issuance
Date
compliance, South Bay Water Recycling, SJCE, Airport passenger facility charges and customer facility charges, and the Single Audit.
Assignments in Process
12. Semi-annual compliance review
of the City’s investment
program
(contracted audit service)
The City’s investment policy requires semi-annual compliance audits of the City’s investment portfolio. MGO will conduct the agreed-upon procedures as of December 31, 2022. In process April 2023 (projected)
13. San José Conservation Corps Review the service delivery and expenditures of funds under City contracts. (request by Councilmember) In process April 2023 (projected)
14. Employee Travel Expenses Periodic audit of employee travel expenditures for appropriateness and compliance with City policies and
procedures. In FY 2021-22, travel expenses totaled roughly $500,000. (Routine audit last conducted in 2017)
In process May 2023
(projected)
15. Development permitting Assess the timeliness of the building permit process for singlefamily residential additions or alterations, including accessory structures. (request by Councilmember)
In process TBD
16. Integrated Waste Management
Inspection Programs
Evaluation of the Integrated Waste Management (IWM)
Enforcement Program’s service delivery. (IWM ranked high on the Citywide risk assessment; open audit request related to IWM) In process TBD
17. Performance measure reviews
(on-going)
Recurring projects to assess the validity and usefulness of performance metrics by City departments, programs, or City Service Areas. This work is intended to be ongoing to augment the Annual Services Report and assist the Administration to enhance the City’s performance management systems in
alignment with the “Outcome, Equity Indicators, and
Performance Management” City Roadmap initiative.
(Councilmembers have made requests about the City’s performance measurement and management in prior years)
In process TBD
Assignments Not Yet Started
18. Language Accessibility Assess City communications for compliance with the City’s Language Access Policy. Specific scope to be determined. (CMO’s Lead and Manage the Organization core service ranked high on the Citywide risk assessment)
19. Our City Forest Audit the expenditure of City funding and service delivery under the terms of grant agreements with the City. This is a follow up to our 2017 Audit of Our City Forest. (request by the Mayor)
20. Non-management employee
performance appraisals
“% of Non-Management Employee Performance Appraisals Completed on Schedule” is a dashboard performance measure in the Adopted Operating Budget’s Strategic Support City Service Area.
According to data provided to the City Auditor’s Office for the Annual Services Report, just 52 percent of non-management employees had on-time performance appraisals in FY 2020-21. (Open audit request and the Lead and Manage the Organization core service ranked high on the Citywide risk assessment)
Note: The approved work plan includes 19 projects. The two semi-annual compliance reviews of the City’s investment program are listed as one project on the work plan but separated here.
The City Auditor’s Fiscal Year 2022-23 Work Plan is online at:
https://www.sanjoseca.gov/your-government/appointees/city-auditor/annual-work-plans