Audit Committee - General - February 11, 2014

Resolution to conduct a portion of the meeting in the absence of the public (Committee of the Whole) in accordance with Section 29 of the TTC By-law to Govern Commission Proceedings and Section 190 of the City of Toronto Act (a) Response to TTC Audit Committee for Additional Information for Contract Management – Special Review (This report involves the security of property belonging to the Commission

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Minutes from Oct 15, 2013

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Requests to speak must be registered in writing by 12:00 Noon of day preceding meeting day.

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b.

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1. Reports with Confidential Attachments

1. Response to TTC Audit Committee for Additional Information for Contract Management – Special Review (This report involves the security of property belonging to the Commission) (For Information)

2. Presentations

1. Presentation – TTC Audit Methodology – Union Station Second Subway Platform and Concourse Improvement Project (For Information)

3. Other Business

1. PricewaterhouseCoopers Consolidated Financial Statement Audit Plan – Year Ended December 31, 2013 (For Information)
2. Auditor General’s Report – Review of Toronto Transit Commission Bus Maintenance and Shops Department – Phase One: Bus Maintenance and Warranty Administration (For Action)
3. Staff Response to Auditor General’s Report – Review of Wheel-Trans Services – Sustaining Level and Quality of Service Requires Changes to the Program (For Action)
4. TTC Audit Department – 2014 Audit Work Plan (For Action)
5. TTC Audit Department Charter (For Action)
6. TTC Audit Department – Organizational Independence (For Information)
7. TTC Audit Department Report - Quarterly Update for the Period October – December 2013 (For Information)

4. New Business

5. Correspondence

A correspondence summary will be distributed at the meeting.

J. Parker, M. Adamson and A. Heisey (TTC Audit Committee), A. Byford (Chief Executive Officer), V. Rodo (Chief Financial and Administration Officer), J. Kennelly (Head of Audit), J. Taylor (Chief of Staff), G. Shortt (Acting Chief Operating Officer), J. Murray (Chief Project Manager – Construction), M. Roche (Head of Finance/Treasurer), J. Griffiths (Auditor General), C. Russell (PricewaterhouseCoopers) and D. McDonald (Co-ordinator – Secretariat Services) were present.

J. Parker was in the Chair

V. Gallop Evoy (J. Parker’s Office), A. Ash, J. Ying, A. Nicolaou and C. Fang Mu (Auditor General’s office) were also present.

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Chair Parker moved that the Committee recess to meet as the Committee of the Whole to receive advice which is subject to solicitor-client privilege and to deal with issues involving the security of property belonging to the Commission.

The motion by Chair Parker carried.

Reconvened
Meeting Open to the Public – 2:20 p.m.
Committee Room 3, City Hall

Commissioner Adamson moved that the TTC Audit Committee approve the minutes of the meeting held on Friday, October 25, 2013.

The motion by the Chair carried.

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1. Reports with Confidential Attachments (Committee Of The Whole)

(a) Response to TTC Audit Committee for Additional Information for Contract Management – Special Review

It is recommended that the TTC Audit Committee receive the confidential information as set out in Confidential Attachment 1, and note that the information is to remain confidential in its entirety as it contains information that involves the security of property belonging to the Commission.

Received

2. Presentations

(a) Presentation – TTC Audit Methodology – Union Station Second Subway Platform and Concourse Improvements Project

Joe Kennelly, Head – Audit Department, provided a presentation on “TTC Methodology – Union Station Second Subway Platform and Concourse Improvements Project”.

The Audit Committee received the presentation for information.

3. Other Business

(a) Update to PricewaterhouseCoopers 2012 Audit Results Report

It is recommended that the Audit Committee receive the attached report from PricewaterhouseCoopers (PWC). This report outlines PWC’s audit plan for the audit of the TTC’s consolidated financial statements and its subsidiary company, TTC Insurance Company, for the year ended December 31, 2013.

Received

(b) Auditor General’s Report – Review of Toronto Transit Commission Bus Maintenance and Shops Department – Phase One: Bus Maintenance and Warranty Administration

Prior to providing a brief summary of the key audit findings, Jeff Griffiths, Auditor General, City of Toronto, thanked Andy Byford and his staff for their cooperation and responsiveness during the audit of TTC’s bus maintenance program.

The TTC Audit Committee received the Auditor General’s Report – Review of Toronto Transit Commission Bus Maintenance and Shops Department – Phase One: Bus Maintenance and Warranty Administration for information; and approved forwarding the report to a regular meeting of the TTC Board for information and then to the Audit Committee of the City of Toronto.

(c) Staff Response to Auditor General’s Report – Review of Wheel-Trans Services – Sustaining Level and Quality of Service Requires Changes to the Program

It is recommended that the TTC Audit Committee:

1) Receive for information the staff response to the Auditor General’s Report; and

2) Approve forwarding the attached report to a regular meeting of the TTC Board for information and then to the Audit Committee of the City of Toronto.

Approved

(d) TTC Audit Department – 2014 Audit Work Plan

The Audit Committee approved the attached TTC Audit Department’s 2014 audit work plan.

Commissioner Heisey moved the following ancillary motion:

Whereas the number of Audit Staff in the TTC’s Audit Department was reduced from 18 to 10 in 2012;

And Whereas the TTC is currently engaged in a number of large capital projects totalling in excess of $2.890 billion over the next 5 years;

And Whereas there are inherent risks associated with large complex construction projects;

Be it Resolved staff are requested to:

a) review and prioritize the large capital projects in the 2014 Audit Work Plan based on the level of risk; and

b) report back to the Audit Committee on:

(i) the adequacy of the controls currently in place,

(ii) whether staffing levels in the Audit Department are sufficient in light of these capital projects and whether existing TTC Internal Audit staff have the expertise necessary to audit construction projects of this magnitude and number, and

(iii) provide a detailed plan, using external or internal resources, to ensure compliance in relation to large capital projects and in particular large construction projects.
Commissioner Heisey’s motion carried unanimously.

(e) TTC Audit Department Charter

It is recommended that the TTC Audit Committee approve the TTC Audit Department Charter.

Approved

(f) TTC Audit Department – Organizational Independence

It is recommended that the TTC Audit Committee receive the information as set out in the report which provides confirmation of the independence of the TTC’s Audit Department.

Received

(g) TTC Audit Department Report – Quarterly Update for the Period October – December 2013
It is recommended that the TTC Audit Committee receive for information the TTC Audit Department Report covering the period from October – December 2013.

Received

4. New Business

Nil

5. Correspondence

Nil

The meeting adjourned at 4:10 p.m.