1997 Management Letter - Former Metropolitan

Toronto Library Board

 The Strategic Policies and Priorities Committee submits, for the information of Council, the following transmittal letter (July 8, 1998) from the Audit Committee and reports having received same:

 Recommendation:

 That the report (June 25, 1998) from the City Auditor attaching the management letter of the former Metropolitan Toronto Library Board, together with the communication (May 27, 1998) from Treasurer of the former Metropolitan Toronto Library Board in response, be received and forwarded to Council for information.

 Background:

 On July 7, 1998, the Audit Committee had before it a report (June 25, 1998) from the City Auditor attaching the management letter of the former Metropolitan Toronto Library Board, together with response (May 27, 1998) from the Treasurer of the former Metropolitan Toronto Library Board.

 The Audit Committee advises that it received the aforementioned reports and directed that copies be forwarded to your Committee and City Council for information.

 --------

 (Report dated June 25, 1998, addressed to the

Audit Committee from the

City Auditor)

 Recommendation:

 It is recommended that the 1997 management letter and the corresponding response relating to the audits of the accounts of the former Metropolitan Toronto Library Board, be received for information.

 Comments:

 I have completed the 1997 audits of the accounts of the former Metropolitan Toronto Library Board, for the year ended December 31, 1997. As a bi-product of my audit, the attached management letter was issued to the CEO and Secretary of the Board. A response from the Treasurer has been received.

 Conclusion:

 I have reviewed the response to the management letter prepared by the Board. The responses are appropriate and will be followed up as part of our future audit work.

 Contact Name and Telephone No.:

 Jerry Shaubel, 392-8462.

 --------

 (Communication dated May 27, 1998, addressed to the

City Auditor from

Mr. Larry Peterson, Treasurer,

former Metropolitan Toronto Library Board)

 We hereby respond to your management letter of the Metropolitan Toronto Library Board for the year ended December 31, 1997.

 Year 2000 Computer Issues:

 Recommendations:

 (1)consideration should be given to establishing a year 2000 project team with overall responsibility for ensuring all potential year 2000 problems are identified and addressed. A year 2000 conversion plan should be developed as soon as possible. It may be appropriate to contact staff at the City of Toronto, who have recently established a specific year 2000 project team to address this issue. The work being done by this team may be of use to the library; and

 (2)Management should establish purchasing policies requiring that any new computer software is certified as "year 2000 compliant."

 Response:

 A project team was established under the library's current Information Technology Steering Committee to look at and resolve Year 2000 issues. The Chair and Co-chair of this committee have met with the City of Toronto Year 2000 Committee and are working with this group on a continuing basis. The City Committee has been extremely helpful and we hope to be able to utilize software and/or licenses that they would obtain for testing. Sharing of information and resources will continue.

 We have been practising a general policy that all software that the Toronto Reference Library obtains is year 2000 compliant.

 Cash and Bank:

 Recommendation:

 (3)Cheques which are stale-dated should be removed from the outstanding cheque list, investigated and either set up as liabilities or included in income on a timely basis.

 Response:

 Stale-dated cheques total $3,070.00. These cheques will be either included in income or reissued after appropriate investigation.

 Purchases:

 Recommendation:

 (4)The Library should only pay for goods received. In addition, when items are returned to the supplier after a payment has been made, the Finance Department should be informed and the corresponding credit recorded promptly.

 Response:

 We agree with the recommendation. We have implemented a procedure whereby supplier invoices are changed whenever there are differences between what the library is invoiced for and what is actually received.

 Payroll:

 Recommendation:

 (5)Unclaimed payroll cheques should be returned to staff other than those who are responsible for processing the payroll. These returned cheques should be securely stored until they are claimed by the payees. Unclaimed cheques should be investigated.

 Response:

 We agree with the concern. There are currently less than ten employees who receive payroll cheques and there are virtually no cheques that are unclaimed. The only exception to this was during 1997 when many cheques were issued to former employees for pay equity settlements. Some unclaimed cheques were returned to Payroll for the specific purpose of making further attempts to locate these individuals. Eventually, unclaimed cheques are cancelled and the liability is set up in the general ledger.

 On an ongoing basis, there is no need to change our current practise.

 Recommendation:

 (6)The Board's policy on vacation carryover should be enforced. Staff with balances in excess of the policy should be required to agree with their managers on a plan to reduce accrued vacation days to the limit prescribed by the policy.

 Response:

 We agree with the recommendation. Individual Managers/Team Leaders have set up plans with individual employees in order to ensure accrued days over the maximum limit get used as soon as possible. Vacation carryover days should be reduced significantly within the next 12-24 months.

 Total banked vacation days were not reduced in 1997 because of the following:

 (1)seventy-one additional days were accrued to employees as some employees moved into a length of service category which entitled them to more vacation time per year;

 (2)the 1997 10 day library closure during peak holiday time meant that employees who would normally use their vacation days during this time period did not due to the fact that they had been laid off; and

(3)the 10 day closure reduced the number of days worked per year, therefore reducing the number of days from which employees could take vacation days without disrupting the operations.

 --------

 (Copy of the 1997 audits of the accounts of the former Metropolitan Toronto Library Board for the year ended December 31, 1997, has been forwarded to all Members of Council with the agenda of the Strategic Policies and Priorities Committee for its meeting on July 24, 1998, and a copy thereof is also on file with the City Clerk.)