OFFICE OF THE CITY COUNCIL

 

CHERYL L. BROWN                                                                                                        117 WEST DUVAL STREET, SUITE 425

            DIRECTOR                                                                                                                                                                                 4TH FLOOR, CITY HALL

   OFFICE (904) 630-1452                                                                                                                                                          JACKSONVILLE, FLORIDA  32202

     FAX (904) 630-2906                                                                                                                                                                                                               

  E-MAIL: CLBROWN@coj.net

September 10, 2009

5:00 PM

 

Performance and Audit Subcommittee Meeting Minutes

August 31, 2009

 

Topic:  Preliminary work plan for FY08-09 independent audit

 

Location:  Conference Room A, City Hall – St. James Building; 117 West Duval Street,

     Suite 425

 

In attendance:  Council Members Webb (Chair), Yarborough, Joost (arr.12:43)

Kirk Sherman and Kyle Billy – Council Auditor’s Office; Jessica Stephens – Legislative Services Division; Jeff Clements – City Council Research; Mike Patillo and Kathleen Dulko – Ernst & Young; Mickey Miller, Kevin Stork, Mike Givens, Kenneth McKeown, Judith Garard, and Patrice Coleman – Administration and Finance Department

 

Meeting Convened:  12:32 p.m.

 

Mike Patillo of Ernst & Young reviewed the proposed work plan for the FY08-09 independent audit with the committee, including the company’s 8 deliverables: 1) audit of financial statements; 2) federal and state grants audit; 3) SMG funds audit; 4) General Employees Pension Fund report; 5) Landfill Closure account audit; 6) a report on internal controls; 7) a management letter; and 8) a report on other matters as required by Florida state regulations on local governments.  The company will produce a separate report on the City’s receipt of federal stimulus (ARRA) funds, which have their own audit requirements.

 

In response to an invitation from Ernst and Young for committee members to suggest any specific areas they felt should be examined during the audit, Council Member Webb suggested looking for “revenue leaks” where the City may not be collecting the full amount of fees, charges or taxes owed it, such as the taxability of private for-profit operations on public property (i.e. on JAA or JPA property), and the collection of the intangible personal property tax.

 

Mickey Miller stated that Jacksonville could be one of two or three counties in the state to join a test case on intangible personal property tax collections.  The Office of General Counsel has expressed concern about entering into a contingent fee arrangement with a collection entity, and Council Member Webb wondered what the cost of such an audit would be.  Mr. Patillo stated that E&Y could deal with revenue leaks from a financial audit perspective as it related to the City’s financial reports, but would not be interested in performing that entire audit itself.  Other jurisdictions are looking at the same kinds of actions to secure all revenues legitimately due them in these tough economic times.

 

Mr. Miller stated that Jacksonville is looking to be an early implementer of the new GASB liability recording standards which require governments to estimate and record their potential liability for things like environmental cleanups (i.e. ash site remediation and landfill closure)

 

This is the last year of E&Y’s contract to be the City’s external auditor.  The City will be bidding out the job for the next audit and will be strongly encouraging more competition from local mid-sized firms rather than just the big national firms that have competed in recent years.

 

 

Meeting Adjourned:  1:00 p.m.

 

Minutes:  Jeff Clements, Council Research

                 9.10.09

Tapes:      Performance and Audit Committee meeting – LSD

                 8.31.09

Materials:  Ernst and Young preliminary audit program handout - LSD

                 8.31.09