(A) The oversight body and management demonstrates a commitment to integrity and ethical values.
(B) The city has the responsibility to establish and maintain an adequate system of internal control and to furnish to the City Common Council, various boards and commissions, governmental agencies, creditors and others reliable financial information on a timely basis. An adequate system of internal control is necessary for the city to discharge these responsibilities.
(C) Controls help ensure that assets are not exposed to unauthorized access and use, transactions are properly recorded in the financial records and the resultant financial information is reliable. External organizations and stakeholders of the city rely on financial information to make decisions toward appropriations, loans and other debt, grants and other contractual relationships. City resources are dependent upon the system of internal control. Auditors are required annually to report upon the adequacy of the city’s systems for control over financial reporting and compliance per I.C. 5-11-1-27(e). The safeguarding of city assets and the reliability which the city and others can place upon its financial records is dependent upon the effectiveness of the internal control process.
(D) As the fiscal body, the Common Council expects the city’s administration to effect an internal control environment with policies and procedures necessary to provide reasonable assurance that practices cause effective and efficient operations, reliable financial reporting and compliance with applicable laws and regulations.
(E) The system of internal control is meant to keep the city on course toward its mission and to minimize surprises. The system promotes efficiency, minimizes risks of asset loss and helps ensure the reliability of financial information and compliance with applicable laws, rules and regulations.
(F) Internal control is a process. It is a means to an end, not an end unto itself. The control environment is the foundation upon which all components of internal control are based. It sets the tone for city operations. Internal control is about people, operations, communications and the work environment. It is not about policies and forms, though it takes shape through the implementation of relevant policies, procedures and practices. Internal control can provide reasonable assurance, but no system of control can provide absolute assurance to the Common Council and other users of financial information.
(G) The Finance Department shall be charged with:
(1) Conveying periodic messages of the city’s internal control philosophy and expectations to all employees;
(2) Evaluating the city’s internal control system for weaknesses on a periodic, but not less frequently than annual, basis and providing solutions to any discovered weaknesses, and informing employees of necessary changes in procedures;
(3) Working with the Human Resources Department to establish a confidential reporting system for individuals to report suspected fraud and abuse of internal control policies; and
(4) Working with the Human Resources Department to institute procedures to address violations of policies and consequences for violations.
(Ord. 2016-04, passed 7-5-2016)