HomeMy WebLinkAbout42- Council CITY OF SAN BERNAF )INO - REQUEST FOB COUNCIL ACTION
From: Councilman Ralph Hernandez Subject: Management Audit of City
Attorney Operations
Dept: Council
Date: March 15 , 1993
Synopsis of Previous Council action:
October 19, 1992 - Tabled until spring or summer, 1993.
Recommended motion:
1. That the City Treasurer be authorized to negotiate and execute an
agreement with Harvey Rose Accountancy Corporation for a management
audit of the City Attorney' s office at a cost not-to-exceed $67, 000.
2. That the audit process be coordinated by the City Treasurer.
3. That no information concerning the audit findings shall be released
prior to review of the draft report by the City Attorney ' s office and
the completion of the final written rep?t .
mv
Signature
Contact person: Councilman Hernandez Phone: 5208
Supporting data attached: yes Ward:
FUNDING REQUIREMENTS: Amount: $67, 000
Source: (Acct. No.) FY 93/94 Budget
(Acct. Description)
Finance:,Llz/��
Council Notes:
75-0262 Agenda Item No.
CITY OF SAN BERNAR^INO - REQUEST FOP COUNCIL ACTION
STAFF REPORT
On October 19, 1992, an agenda item was presented relative to a
management audit of the City Attorney's office. At that time
because of a pending trial, the issue was deferred until the spring
or summer, 1993 when the trial would be concluded.
On December 7, 1992, transfers from the City's reserve funds
increased the City Attorney's budget by $390, 549 and another
$500, 000 is now before the Council. If approved, the total
increase to the City Attorney's budget will be over $890, 0001
representing a 280% increase in litigation expenses over the
approved 92/93 budget.
In a letter to the Grand Jury dated June 19, 1992, City Attorney
James Penman requested that an management audit be conducted and
that the San Bernardino Grand Jury select the auditing firm.
Attached is a letter confirming that Harvey Rose Accountancy
Corporation is the 1992/93 Grand Jury contract auditor. Harvey
Rose was also one of two finalists recommended by City Treasurer
Dave Kennedy.
The lawsuit is now scheduled to go to trial in April, 1993, with an
anticipated duration of three months. Harvey Rose Accountancy
Corporation is currently working on other management audits and
will not be available to begin the San Bernardino project until
July, 1993, the expected ending date for the trial. However,
because of the concern expressed on the effect of the audit on the
trial, this delay is acceptable and will allow time to negotiate
and execute a contract. Also, the delay in beginning the audit
allows for a two - three month buffer to ensure the audit is
completed after the completion of the trial in question. However,
to ensure that the report does not effect the trial outcome, the
audit contract could stipulate that if the trial continues longer
than anticipated, the audit results would not be released until the
trial is complete.
Anticipated Timelines
April 30, 1993 Trial begins
July, 1993 Trial ends (three months)
Audit begins
October, 1993 Audit is completed (three months)
Mr. Penman has expressed concern that a management audit would not
be conducted in an impartial manner because of Mayor Holcomb's
influence as Chief Executive Officer over the audit. However,
since Harvey Rose cannot begin the audit until July, and Mayor
Holcomb will no longer be in office, this concern is moot.
RECOMMENDATION
1. That the City Treasurer be authorized to negotiate and the
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City Administrator execute an agreement with Harvey Rose
Accountancy Corporation for a management audit of the City
Attorney's office at a cost not to exceed $67 , 000.
2 . That the audit process be coordinated by the City Treasurer.
3 . That no information concerning the audit findings shall be
released prior to review of the draft report by the City
Attorney's office and the completion of the final written
report.
GRAND JURY COUNTY OF six two
351 Noah Arrowhead Avon.ROOM 307,COUrt K"* f
6sn Qomw to.4A 924164243 • (714)587-3820
October 14, 1992
Mr. Harvey M. Rose
Rarvey M. Rose Acaounta.n.cy Cvrparation
1390 Market Street, Suite 1025
San Francisco, California 94102
Dear Mr. Rose:
We are pleased to formally advise you that the 1992-93 San
Bernardino County Grand Jury has selected your firm to serve as
its contract auditor during the current fiscal year.
Thank you for your interest in perforating audit services
for the Grand Jury and for your patience while we made our finale
decision. We will be in contact with you in the near future
ragarding possible areas of audit.
We look forward to working with you this year.
Sincerely,
LIOHN B. DUCKWORTE
Foreman
1992-93 Grand Jury
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