2014-11-27 Finance Committee MinutesFINANCE COMMITTEE
CITY OF SAINT JOHN
MINUTES
Thursday, November 27, 2014 —12:00 p.m.
Present:
Mayor Mel Norton
Deputy Mayor Shelley Rinehart
Councillor Merrithew
Councillor Lowe
Councillor Reardon
Pat Woods
Greg Yeomans
Cathy Graham
Hilary Nguyen
Craig Lavigne
Lloyd Foote -- Deloitte
Jeremy Mallais — Deloitte
Also present -- Sherry O'Connor, Recording Secretary
Approval of Agenda
Moved by Councillor Reardon
Seconded by Councillor Lowe
THAT the agenda of the November 27, 2014 meeting be approved as
circulated.
CARRIED
Approval of Minutes
Moved by Councillor Reardon
Seconded by Councillor Lowe
THAT the minutes of the July 23, 2014 meeting be approved as circulated.
CARRIED
Audit Plan
From the stand point of the governance process that the City carries out through the
Finance Committee, Deloitte, as the City's appointed external auditors, are engaged to
provide their professional opinion on the audited financial statements and in doing so the
process that the City follows is that the audit plan is presented to the Finance Committee
for information and full input so that the audit process is a little more understood and
transparent. Deloitte shares with the Finance Committee the risks that they have identified
from a financial statement and reporting perspective.
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Quality is imperative from the stand point of the City relying on these financial statements
therefore Deloitte brings a high level of technical, quality and professionalism. It is not a
one point in time event; there are a number of visits throughout the course of the year.
Deloitte would be in discussions and /or consultations with the senior finance staff in
particular, relative to any accounting issues or financial reporting issues.
Deloitte's intention from a client/service perspective is to work throughout the year so that
at the end of the audit there are no surprises that cause anybody any sort of distress or
add to audit costs.
Key elements of the audit approach:
Deloitte has a four stage audit approach
Initial planning
Fl Assess risk of material misstatement
- Execute audit plan
Reporting and assessing performance
There are various forms of obtaining audit evidence in order for Deloitte to conclude on the
fairness of the financial statements.
There are four procedures that are carried out:
- Internal controls
- Tests of detail
Confirmations and reliance on third parties
- Substantive analytical procedures
The risks have not changed to the prior year's audits. The areas of focus where Deloitte
concentrates their efforts to minimize the risk of material misstatement are:
• Financial statement disclosure and presentation.
• Accounting for controlled entities
• Retirement, post - employment and other employee benefits
• Accounting for tangible capital assets
• Revenue recognition
Audit timeline
The respective audit activities that take place are as follows:
Planning — November to March
Pre -Audit meeting carried out in November /December time frame
Key Client Deliverables — March
Interim and Year End — November to June
Conclude and Report June and July
Key Client Deliverable — July
Lloyd is pleased to report on the standpoint of the client service team that they have
continuity certainly at the senior, manager and partner level. Continuity from the City's
perspective and from our perspective is important. It allows the flow of information to
move more quickly.
Approval of Motion
Moved by Councillor Reardon
Seconded by Councillor Merrithew
THAT the in camera session be added as part of the agenda.
CARRIED
Year -End Projections
Water budget is the good news. The City is looking at a projected surplus amount of
almost $1.5 million.
The General fund deficit is at about $1.43 million projected to year end. Transportation
and Environment Services play a big role in this deficit and Hurricane Arthur added to it.
Revenues are projected to be under budget by almost $270,000 mainly due to the
decrease expected in building permits and rentals.
Police Commission is projected to be over budget by $.5 million and Transit Commission is
over by $.45 million.
Approval of Motion
Moved by Councillor Reardon
Seconded by Councillor Lowe
THAT the 2014 Year End Projections be brought to Council as presented.
CARRIED
The meeting adjourned at 1:00 p.m.
A
Councillor David Merrithew, Chairperson