Title
COMMISSION AUDITOR PRESENTATION ON THE DRAFT 2026 RISK ASSESSMENT AND AUDIT PLAN AND COMPLETED AUDITS OF:
- WASTE PRO SANITATION COLLECTION AND DISPOSAL CONTRACT
- LOBBYISTS CONTRACTS (ERICKS CONSULTANTS, LAWRENCE J. SMITH P.A., AND SMITH, BRYAN & MYERS, INC.)
Summary Explanation and Background
SUMMARY EXPLANATION AND BACKGROUND:
1. On April 16, 2025, the City Commission approved the Fiscal Year (FY) 2025 Audit Plan, which included audits of the Waste Pro Sanitation Collection and Disposal Contract and the Lobbyist Contracts (Ericks Consultants, Lawrence J. Smith, P.A., and Smith, Bryan & Myers, Inc.). These were the final two audits scheduled under the FY2025 Audit Plan and have been completed. Both reports are attached to this agenda. The Commission Auditor will present the audit findings and be available for discussion during the meeting.
2. The FY2025 Audit Plan also included completion of a Risk Assessment and development of the Fiscal Year 2026 Audit Plan for presentation to the City Commission.
3. The Risk Assessment was conducted in three phases:
Phase 1 - Gather Information - Information Gathering: Conducted surveys and interviews with leadership, functional areas, and select stakeholders to identify key initiatives and potential impacts to the City’s risk profile.
Phase 2 - Evaluate Risks - Prioritized areas of concern based on risk to business performance, potential organizational impact, and likelihood of occurrence. Considered the maturity of governance structures, internal controls, monitoring systems, and feedback mechanisms.
Phase 3 - Audit Planning: Proposed internal audit projects based on the City’s overall risk universe, incorporating both high- and medium-rated risk areas, and identified projects for ongoing evaluation throughout the fiscal year.
4. Attached is the draft FY2026 Audit Plan, which includes the following proposed audits:
1) Review the City's purchasing and RFP processes to ensure fair, competitive bidding.
2) Assess controls over CIty vehicle use and maintenance, including fleet utilization, tracking, and oversight.
3) Evaluate how the City is managing budgetary constraints and external funding shortfalls. Focus on processes for prioritizing projects and controlling costs.
4) Examine the building permit and inspection process for delays or compliance gaps.
5) Review the accuracy of water meter readings and billing. Assess controls to help prevent incorrect meter readings leading to inaccurate high-water bills.
6) Review identified issues or control gaps within the City by previous assessments and confirm that corrective actions have been effectively implemented.
7) Strategic, non-routine initiatives undertaken by the City to address emerging priorities, improve operations, or support long-term goals.
8) Attend commission meetings, create presentations, and define project scope and objectives. Manage resources and coordinate with stakeholders.
The estimated total level of effort is 1,330 hours. Using a blended rate of $235 per hour, the estimated total cost to complete the proposed audits is $312,550.
5. The FY2026 budget for the Commission Auditor is $255,000. The agreement with the Commission Auditor provides that annual costs are dependent on City Commission approval of the Annual Audit Plan. The approved plan establishes the number of hours required for each audit, billed at the hourly rates specified in the agreement. Payment for work performed on approved audits is made monthly. If the proposed FY2026 Audit Plan is approved, a budget adjustment will be processed to fully fund the plan.
6. The Commission Auditor will present the FY2026 Risk Assessment and Audit Plan to the City Commission and will request feedback to finalize the plan.
Financial Impact
FINANCIAL IMPACT DETAIL:
a) Initial Cost: $312,550 for Fiscal Year 2026 Audit Plan
b) Amount budgeted for this item in Account No: $255,000 in 001-511-0100-534990-0000-000-0000 - Other Services
c) Source of funding for difference, if not fully budgeted: If the audit plan, as presented, is approved, a budget adjustment of $57,550 will be processed from 001-519-0800-530010-0000-000-0000 - Contingency. If the City Commission approves an adjusted audit plan, the budget adjustment will reflect the amount needed to fund the approved plan.
d) 5 year projection of the operational cost of the project: Not Applicable
e) Detail of additional staff requirements: Not Applicable
FEASIBILITY REVIEW:
A feasibility review is required for the award, renewal and/or expiration of all function sourcing contracts. This analysis is to determine the financial effectiveness of function sourcing services.
a) Was a Feasibility Review/Cost Analysis of Out-Sourcing vs. In-House Labor Conducted for this service? Not Applicable.
b) If Yes, what is the total cost or total savings of utilizing Out-Sourcing vs. In-House Labor for this service? Not Applicable.