A council committee has voted for the City of St. Albert to take steps to better define the process it uses to conduct internal audits.
Kerry Hilts, St. Albert’s interim chief administrative officer, presented three opportunities from St. Albert’s internal audit steering committee to discuss during a May 24 meeting. However, committee members highlighted the need for a process to establish the items that come forward for an audit, rather than receiving administration generated recommendations.
Opportunities Hilts shared with the committee included a review of the city’s insurance program, a deep dive into St. Albert’s fee structures and sponsorship opportunities from other levels of government, and an exploration of different partnership structures for the Arden Theatre.
Brought forward in the city’s Ernst & Young operational and fiscal review, the last option could bring around $700,000 per year in cost savings. Hilts said administration is currently working on a report on different partnership models to come before council in September.
City lacks audit process
Audit committee members pointed out the city is missing a process to evaluate different audit areas.
“We’re kind of like, put some things up on a dart board and throw darts at it,” Coun. Ken MacKay said. “We have to put it into some matrix where we can actually score it … so that we can actually feel confident coming out of the committee that this is the one that we should focus on moving forward.”
Hilts confirmed the city is missing a procedure for pursuing third-party audits, noting that recent audits such as the 2019 audit of the city’s procurement practices stemmed from an administrative recommendation.
Martyn Phillips, a citizen committee member, said the city also needs to have an audit function in order to more properly outline the difference between an audit and a review.
“To distinguish between a review — any old review — an audit should have some definitions,” Phillips said, adding that the function of the audit committee should also be defined.
Hilts said the city has been “floundering” for the last three to four years because it has lacked those definitions.
The city currently has a budget of $350,000 for internal auditor contracts after a motion from Coun. Sheena Hughes passed during budget deliberations last winter.
Hughes said during the committee meeting she feels there’s “no will” in the city to perform internal audit functions.
“Especially when I see what’s coming forward as recommendations,” Hughes said. “What I would love to know, personally, is why we’re bleeding $2 million a year off Servus Place.”
Hilts said the Servus Place audit would be “intrusive,” asking the committee if this particular moment — coming out of the COVID-19 pandemic — would be the best time for the audit.
“Not to say that it shouldn’t be done,” Hilts said. “Is this the best time to do it?”
The committee ultimately voted unanimously to direct administration to bring forward a report identifying internal auditing processes and related costs by September 2022. The report will scan municipalities with established internal audit functions.
