Meeting_Body
FINANCE, BUDGET AND AUDIT COMMITTEE
SEPTEMBER 20, 2023
Subject
SUBJECT: MANAGEMENT AUDIT SERVICES FY 2023 FOURTH QUARTER STATUS REPORT AND CUMULATIVE YEAR-END REPORT
Action
ACTION: RECEIVE AND FILE
Heading
RECOMMENDATION
Title
RECEIVE AND FILE the Management Audit Services (MAS) FY 2023 Fourth Quarter status report and cumulative FY 2023 year-end report.
Issue
ISSUE
MAS is required to provide a quarterly activity report to Metro’s Board of Directors (Board) that presents information on audits that have been completed or are in progress, including information related to audit follow-up activities.
Background
BACKGROUND
It is customary practice for MAS to deliver the quarterly audit report. The FY 2023 Fourth Quarter report covers the period of April 1, 2023, through June 30, 2023; and the cumulative FY 2023 year-end for the period of July 1, 2022, through June 30, 2023.
Discussion
DISCUSSION
MAS provides audit services in support of Metro’s ability to provide responsive, accountable, and trustworthy governance. The department performs internal and external audits. Internal audits evaluate the processes and controls within the agency, while external audits analyze contractors, cities, and/or non-profit organizations that are recipients of Metro funds. The department delivers management audit services through functional groups: Performance Audit; Contract, Financial and Compliance Audit; and Administration and Policy, which includes audit support functions. Performance Audit is mainly responsible for internal audits related to Operations, Finance and Administration, Planning and Development, Program Management, Information Technology, Communications, Risk, Safety, and Asset Management including the Chief Executive Office; and other internal areas. Contract, Financial, and Compliance Audit is primarily responsible for external audits in Planning, Program Management, and Vendor/Contract Management. MAS’ functional units assure the public that internal processes and programs are being managed efficiently, effectively, economically, ethically, and equitably; and that desired outcomes are being achieved. This assurance is provided by MAS’ functional units conducting audits of program effectiveness, economy and efficiency, internal controls, and compliance. Administration and Policy is responsible for administration, financial management, quality assurance, and audit support, including audit follow-up, and resolution tracking.
The following summarizes MAS activity for FY 2023 Fourth Quarter and FY 2023 year ending June 30, 2023.
Performance Audits: One (1) audit project was completed for the quarter; seven (7) for the fiscal year; and six (6) were in progress.
Contract, Financial, and Compliance Audits: Eighteen (18) audits including twelve (12) Contract Pre-award audits for the Engineering Support Services for Vertical Transportation Systems & Related Services Project and four (4) financial and compliance audits of grantees with a total expenditure value of $7 million were completed for the quarter. Forty-six (46) audits with a total expenditure value of $90 million were completed for the fiscal year; and seventy (70) were in progress.
Financial and Compliance Audits of Metro: 147 audits were issued by external Certified Public Accounting (CPA) firms.
Transitional Indirect Cost Rate (TICR): Two (2) TICR approvals were issued for the Small Business Entities (SBE).
Audit Follow-up and Resolution: Nineteen (19) recommendations were closed for the quarter; and 45 for the fiscal year.
Note: MAS performs audit follow-up for the Office of Inspector General (OIG). Two (2) recommendations were closed for the quarter; and six (6) for the fiscal year.
The FY 2023 Fourth Quarter Status Report and Cumulative Year-End Report are included as Attachment A.
Equity_Platform
EQUITY PLATFORM
Management Audit Services’ quarterly audit activities provide an additional level of review and assessment to identify potential equity impacts from Metro’s work and performance. These quarterly activities inform the cumulative end-of-year report. There are no known equity impacts or concerns from audit services conducted during FY 2023.
Implementation_of_Strategic_Plan_Goals
IMPLEMENTATION OF STRATEGIC PLAN GOALS
Management Audit Services FY 2023 Fourth Quarter Status Report and Cumulative Year-End Report supports Metro’s Vision 2028 Goal #5: Provide responsive, accountable, and trustworthy governance within the Metro organization.
Next_Steps
NEXT STEPS
Management Audit Services will continue to report audit activity throughout the current fiscal year.
Attachments
ATTACHMENT
Attachment A - FY 2023 Fourth Quarter Status Report and Cumulative Year-End Report
Prepared_by
Prepared by: Kimberly Houston, Deputy Chief Auditor, (213) 922-4720
Lauren Choi, Senior Director, Audit, (213) 922-3926
Alfred Rodas, Senior Director, Audit, (213) 922-4553
Monica Del Toro, Senior Manager, Audit, (213) 922-7494
Reviewed_by
Reviewed by: Sharon Gookin, Deputy Chief Executive Officer, (213) 418-3101
