In what amounts to an audit of the auditors, the City Council Auditor’s Office received a recent peer review with favorable results.
Specifically, the review said that the office’s “internal quality control system was suitably designed and operating effectively to provide reasonable assurance of compliance” with government auditing standards in the industry.
The review covered Jan. 1, 2009, to Dec. 31, 2011.
The auditor’s office conducts audits and non-audit services in accordance with generally accepted government standards that “provide a framework for conducting high quality audits with competence, integrity, objectivity, and independence,” according to Council Auditor Kirk Sherman, in a letter to Council members.
The external peer review is a requirement at least once every three years and is “equivalent to the auditors being audited” to ensure the office is conforming to professional standards, Sherman said in the letter.
The review was conducted by the Association of Local Government Auditors.
According to the report, the procedures for the audit included reviewing the auditor’s office’s written policy and rules; internal monitoring procedures; a sample audit and attestation engagement reports and working papers; documents relating to independence, training and development of auditing staff; and interviewing auditing staff to assess their understanding of and compliance with relevant quality control policies and procedures.
The report also stated areas where the auditor’s office excels as well as suggestions to strengthen adherence.
Exemplary practices were “meticulously prepared” work papers, “thorough and well-documented” supervisory review of work papers and the staff’s level of professionalism.
The review also offered suggestions.
The first suggestion was to evaluate threats to the office’s independence and have the auditor’s “Verification of Staff Independence” form “include a statement that the work performed by the Legislative Section has been taken into consideration when making this determination.”
It was also recommended that only the Council Auditor sign off on the verification.
The final recommendation was for the office to develop a quality control checklist to use when beginning a non-audit service engagement to help ensure all requirements are met and independence is secure.
In a response letter, Sherman agreed with both recommendations and said both would be implemented.
356-2466