MINUTES OF THE MEETING
OF
THE AUDIT COMMITTEE

November 15, 2011

 

 


 

A meeting of the Audit Committee was held via videoconference at the Authority’s offices at 123 Main Street, White Plains, New York at approximately 10:25 a.m.

 

 

The following Members of the Audit Committee were present:

 

Trustee D. Patrick Curley, Chairperson

Trustee Jonathan Foster

Trustee Eugene L. Nicandri

 

Also in attendance were:

 

            Michael J. Townsend                 Chairman

            John S. Dyson                             Trustee

            R. Wayne LeChase                      Trustee

            Gil Quiniones                             Acting President and Chief Executive Officer

            Judith McCarthy                        Acting General Counsel

            Donald Russak                           Acting Chief Financial Officer

            Karen Delince                            Corporate Secretary

            Brian McElroy                            Treasurer

            Thomas Concadoro                   Vice President and Controller

            Lesly Pardo                                Vice President – Internal Audit

            Dennis Eccleston                       Chief Information Officer

            Lorna Johnson                           Assistant Corporate Secretary

            Sheila Baughman                     Senior Secretary, Corporate Secretary’s Office

            Ken Deon                                   Managing Partner, KPMG

            Brendan Kennedy                     Senior Manager, KPMG



Introduction

 

            Chairman D. Patrick Curley welcomed committee members and also Chairman Townsend, Trustees Dyson and LeChase, and staff to the meeting.

  1. Adoption of the Meeting Agenda

 

By motion made and seconded the agenda for the meeting was approved.

  


  1. Approval of the Minutes of the Regular Meeting of September 27, 2011 

 

The minutes of the Committee’s Regular Meeting of September 27, 2011 were adopted.

 

  1. Internal Audit Activity Report

                          

Mr. Lesly Pardo presented an overview of the Authority’s 2011 Internal Audit Plan to the Committee.  He said that as of October 31, 2011, twenty-seven audits have been completed and six are in progress.  Approximately 86% of the audits in the Audit Plan are completed or in progress.  Twenty-two audit reports with 47 recommendations to improve or enhance the Authority’s internal controls were issued.  He said that Internal Audit staff tracks the status of the recommendations and receives full cooperation from management during the audits.

 

Mr. Pardo reported two changes to the Audit Plan.  The operations compliance audit at the Blenheim-Gilboa Project was postponed until the first quarter of 2012 because of the impacts of hurricane Irene.  The audit on Energy Services’ solar projects was also postponed because of inactivity.  As a result of this, two audits were added to the Plan: 1) compliance with NYS Comptroller’s new contract reporting requirements whereby contracts exceeding $1 million that were not competitively bid or awarded on a sole source basis must be sent to the Controller for approval; and 2) review of Headquarters Travel Expenses.  He ended by stating that Internal Audit is in the process of completing its 2012 Audit Plan; the staff will be meeting with Business Unit heads to identify critical risk areas and will also contact the Committee for input in the Plan.

 

            In response to a question from Trustee Nicandri, Mr. Pardo said Internal Audit conducted a review of selected activities of the Law Department, including its expenditures for outside legal services, which was completed the second quarter of this year.

 

  

  1. KPMG 2011 Audit Plan

 

Mr. Ken Deon, KPMG’s audit engagement partner, presented an overview of the Authority’s 2011 Audit Plan.  In response to a question from Trustee Nicandri, Mr. Deon said that he has experience in government and energy audits.  As the engagement partner in charge of the Authority’s audit, he is fully involved in all phases of the audit.  Also, in regard to his level of participation in the audits, the timing of the Authority’s audit fits in well with his schedule of other engagements so he can spend sufficient time at the Authority.  Although two new auditors were added to the team, there is consistency in the team of auditors assigned as outlined in the Engagement Team Chart.  Mr. Deon also outlined KPMG’s 2011 Audit Objectives and gave a summary of the Authority’s management and Audit Committee’s responsibilities, as well as KPMG’s responsibilities in conducting the audit in accordance with generally accepted auditing standards.

 

In response to a question from Chairman Curley, Mr. Deon said that, as part of KPMG’s professional responsibility to the Authority, the team meets with Mr. Pardo to review the Authority’s internal audits performed during the course of the year and adjusts KPMG’s audit scope, if appropriate.  Mr. Pardo added that KPMG receives a copy of all audit reports completed by Internal Audit. 

 

In response to a question from Trustee Nicandri, Mr. Deon said that Mr. Pardo provides KPMG with a copy of the Authority’s Internal Audit Plan, which he presents to the Audit Committee, and which KPMG uses as a basis for relying on its audits.

 

Mr. Brendan Kennedy, Senior Manager, discussed KPMG’s audit approach and methodology; risks, specific to the Authority, in conducting the audits; and entity-wide and monitoring controls, the basis for the Audit.  He said that KPMG’s goal is to perform an effective and efficient audit.  In conducting the audits, KPMG communicates with the Authority’s Internal Audit staff, its management and Audit Committee on a regular basis and complies with professional standards of conduct.  Mr. Kennedy then outlined KPMG’s timetable through March 27, 2012, at which time the financial statements will be presented for approval.

 


5.         Next Meeting

 

The next regular meeting of the Audit Committee will be held on Tuesday, March 27, 2012, to commence at approximately 9:30 a.m., at the Clarence D. Rappleyea Building, White Plains, New York. 

 

On motion made and seconded, the meeting was adjourned at approximately 11:00 a.m.