HomeMy WebLinkAboutAudit Committee Minutes 03 04 2009_201402041939414439
Town of Nantucket
Audit Committee Meeting
Minutes – Audit Committee Meeting March 4th, 2009
Approved March 25, 2009
Present: Mr. Jim Kelly, Mr. Michael Kopko, Ms. Patricia Roggeveen, Ms. Constance Voges,
and Mr. Bob Dickinson
Absent: None.
Also present: Mr. Rick Atherton, Mr. Malachy Rice, and Mr. Craig Abernathy
Call to Order:
Ms. Roggeveen called the meeting to order at 2:00 PM.
Announcements and Updates:
None.
Approval of Minutes of 10 February 2009:
Mr. Kelly moved to approve the minutes of February 10th, 2009; seconded by Mr.
Kopko. So voted unanimously.
Update on Status of FY 2008 Audit
Ms. Voges stated that she has not yet received a draft of the FY 2008 Audit, but
she has been assured by Reneé Davis, Powers and Sullivan, that the draft will come
today. Ms. Voges added that the numbers for the audit are now in the reporting
format, and as such she will be able to work on her letter to be included in the audit
report. Ms. Voges commented that she expects to continue this work until the week
before the audit is due to be submitted to the Department of Revenue (DOR).
Mr. Kelly asked Ms. Voges when she expects to receive the Letter to
Management. Ms. Voges answered that she has not seen the Letter to Management,
and that she does not expect it to be included with the copy of the draft she will receive
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March 4th, 2009 Page 2 of 4
today. Mr. Kelly then asked Ms. Voges if she expects there to be many changes in
recommendations for reporting. Ms. Voges answered that last year’s audit contained
more changes than she expected, but it is difficult to predict for this year.
Update on State Reporting
Mr. Dickinson stated that he has been working on Schedule A and the Balance
Sheet. He added that he has sent Schedule A to the Abrahams Group, but he will need
to review the document when it is returned. He explained that the Abrahams Group has
been contracted to perform part of the work related to Schedule A. Mr. Dickinson
stated that he hopes Schedule A will be returned by the end of the week.
Mr. Kopko asked Ms. Voges if she anticipates completing this portion of
reporting prior to March 20th. Ms. Voges responded in the affirmative, and commented
that in years prior to 2003 this work was done by the auditors after finishing the audit.
She noted that in the past some State payments were delayed due to the fact that this
reporting was not complete until summer. Mr. Rice pointed out that the deadline for
reporting is September 30th, but asserted that no community ever makes this
submission date. Mr. Atherton asked how the Town is notified of delays in State
payments. Mr. Kopko answered that he received a letter from the State notifying him of
the delay in reporting. Mr. Atherton asked that he be kept advised of any such delays
on an ongoing basis. Ms. Roggeveen replied that the forum of the Audit Committee is
the area in which such notifications are made.
Update on the Abrahams Group Implementation Plan
Referencing unusual challenges faced during the current year, Ms. Voges stated
that some items in the Abrahams Group Implementation Plan have not yet been
completed due to the challenges of completing the FY 2008 Audit and the December
Special Town Meeting. She noted that most recommendations associated with Cash
Reconciliations have been implemented, and that these recommendations represent
the most critical part of the implementation plan.
Mr. Kelly asked if the plan is to complete additional items in the implementation
plan prior to having Mark Abrahams return to review progress. Mr. Rice answered,
stating Mr. Abrahams will return to review the Town’s progress rather than waiting for
the completion of additional items.
Mr. Kopko asked about progress in transferring additional responsibilities to
Human Resources. Ms. Voges stated that the transfer is included in Phase Two
recommendations. Mr. Kopko then noted that the transfer has not been implemented,
yet additional staff has been hired to accommodate the additional work in the
department associated with the transfer. Mr. Rice answered that currently the position
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March 4th, 2009 Page 3 of 4
is being staffed on a part‐time basis, while the recommendation calls for full‐time
staffing.
Discussion of Independent Interviews with Powers and Sullivan
Mr. Kopko commented that he is not aware of any independent meetings ever
being conducted between the Audit Committee and the Town’s auditing firm. Ms.
Roggeveen asserted her belief that such a meeting will be useful especially since the
Town will be issuing a request for proposal for auditing services this year.
Ms. Voges asked that the Committee request an explanation of costs be included
in a new contract with Powers and Sullivan. Mr. Rice noted that part of the contract
may include additional costs related to the audits of the Airport and the Water
Company. Ms. Voges pointed out that these items are part of the current contract, but
Powers and Sullivan continues to use audit work performed by Burke and Lamb. Mr.
Kopko asked if the Airport and Water Company have agreed to have their audits
performed in conjunction with the Town’s audit. Ms. Voges answered that both parties
have agreed, but added that she believes they intend to keep Burke and Lamb for some
of their financial work.
Mr. Kopko commented that although he has never heard of Nantucket’s Audit
Committee conducting these types of meetings with its audit firm, Jim Sullivan and
Reneé Davis, Powers and Sullivan, have assured him that these types of meetings are
not unusual. Ms. Roggeveen asked if it would be productive to talk about contract
renewals during the meeting. Mr. Kopko asserted his belief that he would prefer to
separate those discussions from the meeting. Ms. Gibson agreed.
Cash Reconciliations
Mr. Dickinson stated that January was a tax month and as such the reconciliation
is taking a bit longer than other months. Ms. Gibson asked if the reconciliation has been
completed or if it is outstanding. Mr. Dickinson answered that there are some
outstanding reconciliations in terms of money coming in, as timing differences are
affecting $20 million collected by the Town in January.
Mr. Atherton asked if the opening balance as of July 1st is still to be completed or
if there is still a variance. Ms. Voges stated that as part of audit procedure the Town
must carry the variance until the variance can be found in previous fiscal years. She
noted that in the past auditors relied upon external audits from Airport and Water
Company for their work, and asserted her belief that the variance will be found here.
She stated that she believes an error in posting wire payments to the Water Company
may be the cause of the variance. Mr. Atherton then asked if audits can go forward
when there is a variance. Ms. Voges answered in the affirmative, but noted that the
variance can affect Free Cash. She added that she has allowed for this contingency.
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March 4th, 2009 Page 4 of 4
New Business:
None.
Other Business:
None.
Date of Next Meeting:
Ms. Roggeveen proposed that the next meeting should take place on Wednesday,
March 25th, 2009, at 9:00 AM.
Adjournment
Ms. Roggeveen asked for a motion to adjourn which was “so moved” by Mr. Kelly.
The meeting was adjourned at 2:32 PM.
Prepared by Craig Abernathy