City of Stockton
FY 21-22 Internal Audit Program
Audit Committee Meeting
July 12, 2021
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Overview
I. Introduction
II. Internal Audit Program Components
III. Internal Audit Program Review
IV. Potential FY 21-22 Inte rnal Audit Projects
V. Recommended FY 21-22 Internal Audit Plan
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3 I. Introduction
• The City retained Moss Adams LLP to serve as the designated Internal Audito
r and conduct projects focusing on:
◦ Risks
◦ Internal controls
◦ Compliance
◦ Performance
◦ Best practices
• Work is being completed under relevant industry standards
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4 Internal Audit
Risks Internal Controls Compliance Performance
Areas of Focus: accounting and financial reporting, asset management, capital programs, compliance, economics and funding, fraud, governance, human resources, internal controls, maintenance and operations, management, operations and service delivery, organization and staffing, processes and procedures, procurement, public safety, risk management, and technology
II. Internal Audit Program Components
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5 III. Internal Audit Program Review
Focus Accomplishments
• Enterprise Risk Assessments 2013, 2016, 2019
• Enterprise Internal Controls Review 2013
• Fu
nctional Internal Controls Reviews 8 areas for design reviews • Functional Internal Controls Testing 12 areas for compliance tests • Policy Review and Development Over 175 ADs and citywide policies • Performance Measures Citywide and Department KPIs
• Performance Projects Multipl e performance assessments • Findings Tracking Over 450 findings tracked
• Findings Validated Over 31 0 findings validated
• Ethics Hotline Over 140 reports since 2007
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6 IV. Potential FY 21-22 Internal Audit Projects
1. Enterprise Risk Assessment
2. Capital Program Process Improvement
3. Business Continuity Assessment
4. Procurement Operational Review
5. Department or Program Efficiency Study
6. Internal Controls Review (Systems/Segregation of Duties Focus)
7. Grant Management Review
8. Vendor Management Review (2)
9. EDD Loan Program Review
10.Policies and Procedures Development Support
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7 V. Recommended FY 21-22 Internal Audit Plan
1. Enterprise Risk Assessment: Assess risks across the organization to dete
rmine progress and inform the internal audit program.
4. Procurement Operational Review: Assess procurement polices, proce
dures, processes, controls, and performance.
6. Internal Controls Review (Systems/Segregation of Duties Focus): Assess contr
ols surrounding the new ERP environment.
8. Vendor Management Reviews: Assess overall vendor management polices, proce
dures, and controls for two specific vendor contracts.
10.Policies Development Ongoing Support: Continue to participate in Policy Review
Committee meetings and facilitate/support policy development and update efforts
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8 V. Recommended FY 21-22 Internal Audit Plan
# Project Budget 7-9/21 10-12/21 1-3/22 4-6/22
1 Enterprise Risk Assessment $50,000
4 Procurement Operations Review $45,000
6 Internal Controls Review – Systems $45,000
8 Vendor Management Review – A $40,000
Vendor Management Review – B $40,000
10 Policies Development Ongoing Support $25,000
Audit Findings Validation and Reporting $50,000
Internal Audit Program Management $30,000
Total $325,000
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The material appearing in this presentation is for informational purposes only and is not legal or accounting advice. Communication of this information is not intended to create, and receipt does not constitute, a legal relationship, including, but not limited to, an accountant-client relationship. Although these materials may have been prepared by professionals, they should not be used as a substitute for professional services. If legal, accounting, or other professional advice is required, the services of a professional should be sought.
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