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[CALL TO ORDER]

[00:00:03]

TODAY'S AUDIT COMMITTEE MEETING IS NOW CALLED TO ORDER AS A SPECIAL MEETING OF THE BOARD OF EDUCATION. I'M SORRY, [INAUDIBLE] SORRY.

THIS MEETING OF THE BOARD'S AUDIT COMMITTEE IS NOW CALLED TO ORDER FOR THE PURPOSES STATED IN THE DULY POSTED MEETING NOTICE.

THE TIME IS 9:01AM COMMITTEE MEMBERS PRESENT IN THE BOARD AUDITORIUM ARE TRUSTEE SUNG, TRUSTEE HERNANDEZ, MYSELF, TRUSTEE CRUZ AND OUR COMMUNITY VOLUNTEER LIZ LOGAN.

WE ARE NOW READY TO CONSIDER.

WE ARE NOW READY TO CONSIDER BUSINESS ITEMS FOR DISCUSSION.

SO CHIEF BLACKWELL WILL START WITH THE DISTRICT FINANCIAL STATEMENT AUDIT.

[DISTRICT FINANCIAL STATEMENT AUDIT RESULTS FOR FY 2021]

YOU KNOW, YOU KNOW, BECAUSE WE'RE NOT A WE'RE NOT A QUORUM.

WELL, GOOD MORNING TRUSTEES AND SUPERINTENDENT HOUSE, WE HAVE AN EXHAUSTIVE AGENDA FOR YOU TODAY COVERING A LOT OF DIFFERENT TOPICS, AND WE'LL JUMP INTO THOSE.

RIGHT NOW, MADAM CHAIR, DO YOU WANT TO DO ANYTHING WITH THE MINUTES ITSELF THAT YOU LIKE? OKAY. SURE. NO, MINUTES OKAY, OKAY.

OK, OUR FIRST ITEM IS THE STATUS OF RECOMMENDATION IMPLEMENTATION FOR THE DISTRICT FINANCIAL STATEMENT AUDIT.

IS LAURA HERE TODAY? OKAY. OH, THERE SHE IS.

HEY, LAURA, GOOD MORNING.

GOOD MORNING. I'M ON VIDEO, BUT MATT ROGERS IS ALSO THERE AND HE CAN PRESENT IN PERSON, BUT I'M HERE WITH ANY QUESTIONS.

DISTRICT'S FINANCIAL STATEMENT AUDITS.

WE'RE HERE TO PRESENT THE RESULTS FOR THE FISCAL YEAR 21.

SO WE'LL JUST BRIEFLY COVER THE AUDIT PROCESS AUDIT RESULTS, SORRY, MR. ROGERS, IS THAT YOUR NAME? DID YOU SAY? CAN YOU JUST HAVE THE MIC RIGHT UP TO YOU BECAUSE IT'S BEING TELECAST? YES, MA'AM. THANK YOU.

SO WE'LL COVER THE AUDIT PROCESS, AUDIT RESULTS AND COMMUNICATIONS, FINANCIAL HIGHLIGHTS AND THEN UPCOMING CHANGES, AND THEN GO OVER ANY QUESTIONS THAT YOU MAY HAVE.

SO THE TYPICAL AUDIT PROCESS, WE DO OUR INITIAL PLANNING BEFORE WE COME IN FOR INTERIM FIELD WORK, WHICH IS USUALLY BEFORE THE SUMMER, THEN WE USUALLY COME IN A WEEK OR TWO DURING JUNE OR JULY TO TEST SOME INTERNAL CONTROL TRANSACTIONS.

WE ALSO TEST SOME PROCUREMENT ITEMS, REVIEW INTERNAL CONTROL PROCESSES, AND WE ALSO KIND OF FURTHER REFINE AND DEVELOP THE AUDIT PLAN FOR YEAR END.

AH, YEAR END FIELD WORK.

THE TIME FRAME FOR THAT IS USUALLY AROUND THE FIRST WEEK OF SEPTEMBER, AND THEN WE ARE ON SITE UNTIL THE END OF OCTOBER AND THEN ISSUE EARLY NOVEMBER.

WHICH IS WHICH THIS YEAR WILL BE ADOPTED BY THE BOARD, HOPEFULLY ON NOVEMBER 11TH AND IN HIS OUR AUDIT IS NOT YET OFFICIALLY COMPLETE, WE DON'T HAVE THE SAME INDEPENDENT AUDITOR'S REPORT YET, BUT IT IS EXPECTED TO BE DATED NOVEMBER 11.

SO THE AUDIT STANDARDS UNDER WHICH THE AUDITS PERFORMED, GENERALLY ACCEPTED AUDIT STANDARDS AND GENERALLY ACCEPTED GOVERNMENT AUDITING STANDARDS ARE OTHERWISE KNOWN AS GAGAS OR YELLOW BOOK.

WE ALSO PERFORM THE SINGLE AUDIT, WHICH IS THE AUDIT OF THE FEDERAL AWARDS.

IN ACCORDANCE WITH THE UNIFORM GUIDANCE.

WE ALSO PERFORM THE SINGLE AUDIT UNDER STATE AWARDS AS WELL.

AND WE TEST COMPLIANCE WITH CERTAIN PROVISIONS OF LAWS, REGULATIONS, CONTRACTS, GRANT AGREEMENTS, WHICH INCLUDES PUBLIC FUNDS INVESTMENT ACT, OTHER TA STATE COMPLIANCE REQUIREMENTS. OUR AUDIT PERFORMS IS PERFORMED UNDER A RISK BASED, RISK BASED APPROACH.

[00:05:08]

TYPICALLY, THOSE RISKS FOR SCHOOL DISTRICTS INCLUDES FEDERAL AND STATE GRANT REVENUES AND EXPENDITURES. THE STATE FOUNDATION'S SCHOOL PROGRAM AND RELATED ESTIMATES CONSTRUCTION IN PROGRESS, PURCHASING REQUIREMENTS, INCLUDING BIDS AND RELATED CAPITAL ASSETS, PAYROLL AND PAYROLL RELATED LIABILITIES, AND THEN ALSO ACCOUNTS PAYABLE AND RELATED DISBURSEMENTS.

WE ALSO TEST INTERNAL CONTROLS OVER FINANCIAL REPORTING AND INTERNAL CONTROLS OVER COMPLIANCE. HOWEVER, WE DO NOT ISSUE AN OPINION ON INTERNAL CONTROLS, BUT WE USE OUR TESTING THERE TO DEVELOP AND FURTHER REFINE OUR AUDIT PLAN.

WE ALSO TEST COMPLIANCE WITH MAJOR PROGRAMS, WHICH UNDER THE FEDERAL AND STATE REQUIREMENTS. SO THIS YEAR, THIS IS THE SCHEDULE ARE INCLUDED ON THE SCHEDULE OF FINDINGS AND QUESTION COSTS, WHICH IS INCLUDED IN THE COMPREHENSIVE ANNUAL FINANCIAL REPORT DOCUMENTS.

THE TYPE OF REPORT THAT WILL BE ISSUED THIS YEAR UNDER THE FINANCIAL STATEMENT AUDIT IS AN UNMODIFIED OPINION.

AN UNMODIFIED OPINION IS THE HIGHEST LEVEL OF ASSURANCE YOU CAN RECEIVE IN A FINANCIAL STATEMENT AUDIT. ALSO INCLUDED IN THAT REPORT, WE DID NOT OR WE DID IDENTIFY ONE MATERIAL WEAKNESS THIS YEAR, WHICH WE'LL COVER HERE IN A COUPLE OF SLIDES.

WE DID NOT IDENTIFY ANY SIGNIFICANT DEFICIENCIES AND WE DID NOT IDENTIFY NONCOMPLIANCE MATERIAL TO THE FINANCIAL STATEMENTS.

AND SO FOR FEDERAL AND STATE AWARDS, AGAIN, THIS IS THE SINGLE AUDIT, THE REPORT THAT WOULD BE ISSUED UNDER THOSE MAJOR PROGRAMS IS UNMODIFIED OPINION AGAINST THE HIGHEST LEVEL OF ASSURANCE YOU CAN RECEIVE THE TYPE OF AUDITEE, HIGH RISK AUDITEE.

THE REASON FOR THAT IS BECAUSE OF FINDINGS IDENTIFIED IN PREVIOUS YEARS.

INTERNAL CONTROL OVER MAJOR PROGRAMS WE DID NOT IDENTIFY MATERIAL WEAKNESSES UNDER MAJOR PROGRAMS THIS YEAR. WE DO NOT IDENTIFY ANY SIGNIFICANT DEFICIENCIES, AND THERE ARE NO OTHER FINDINGS REQUIRED UNDER UNIFORM GUIDANCE OR TEXAS UNIFORM GRANT MANAGEMENT STANDARDS, WHICH IS THE STATE REQUIREMENTS.

SO FEDERAL MAJOR PROGRAMS THIS YEAR INCLUDED CHILD NUTRITION CLUSTER, THE CHILD AND ADULT CARE FOOD PROGRAM, ELEMENTARY AND SECONDARY SCHOOL EMERGENCY RELIEF FUND, OTHERWISE KNOWN AS ESSER, CORONAVIRUS RELIEF FUND.

TITLE ONE SPECIAL EDUCATION CLUSTER AND THE TWENTY FIRST CENTURY COMMUNITY LEARNING CENTERS.

UNDER THE STATE SINGLE AUDIT.

THE TWO PROGRAMS TESTED THIS YEAR WERE THE TEXAS HOME VISIT PROGRAM AND THE SCHOOL LUNCH MATCHING PROGRAM.

AND SO THIS IS THE MATERIAL WEAKNESS THAT WE IDENTIFIED THIS YEAR OVER FINANCIAL REPORTING, WHICH PERTAINS TO IMPROPER RECOGNITION OF IN-KIND REVENUES AND EXPENDITURES.

AND SO BASICALLY, THIS IS THE DISTRICT'S PARTICIPATION IN OPERATION CONNECTIVITY THROUGH REGION FOUR. IT WAS FUNDED THROUGH MULTIPLE SOURCES, BUT A PORTION OF THAT $10 MILLION OF THAT WAS FUNDED AS AN IN-KIND CONTRIBUTION FROM REGION FOUR TO THE DISTRICT.

AND THAT PORTION WAS DISCOVERED TO HAVE NOT BEEN RECORDED PRIOR TO ISSUING THE FINANCIAL STATEMENTS. AND SO, IN LINE WITH PROFESSIONAL STANDARDS, WE DISCUSSED IT WITH MANAGEMENT DETERMINED THAT THIS WILL BE A MATERIAL WEAKNESS.

STATUS OF PRIOR YEAR FINDINGS, THERE WERE FOUR FINDINGS LAST YEAR, THE FIRST ONE MATERIAL WEAKNESS OVER FINANCIAL REPORTING FOR CAPITAL LEASES.

THE SECOND A MATERIAL WEAKNESS OVER FINANCIAL REPORTING FOR GOODS RECEIPTS, WHICH RELATED TO CONSTRUCTION PROGRESS, CAPITAL ASSETS, A SIGNIFICANT DEFICIENCY OF OUR FINANCIAL REPORTING FOR TIMELINESS OF CASH DEPOSITS AND ALSO A SIGNIFICANT DEFICIENCY OVER FINANCIAL REPORTING FOR COLLECTABILITY OF CERTAIN RECEIVABLES.

WE JUST WANTED TO NOTE HERE THAT WE HAVE FOLLOWED UP ON THE STATUS OF ALL THESE FINDINGS AND WE'VE DETERMINED THAT THEY HAVE BEEN RESOLVED AND COMPLETED.

SOME OTHER COMMUNICATIONS, ALL SIGNIFICANT ACCOUNTING POLICIES ARE DISCLOSED IN NOTE ONE TO THE FINANCIAL STATEMENTS.

THE DISTRICT DID ADOPT GASB STATEMENT EIGHTY FOUR THIS YEAR, WHICH DEALS WITH FIDUCIARY ISSUES, AND SO IT ESTABLISHES A CRITERIA FOR IDENTIFYING FIDUCIARY ACTIVITIES, WHICH ESSENTIALLY IS WHETHER THE DISTRICT CONTROLS THE ASSETS OF THE FIDUCIARY ACTIVITY, WHETHER THERE'S A BENEFICIARY RELATIONSHIP.

THIS DID RESULT IN A RESTATEMENT OF THE SPECIAL REVENUE FUNDS, SO IT ADDED 13 MILLION TO

[00:10:03]

THE SPECIAL REVENUE FUND, AND IT ALSO CREATED BEGINNING NET POSITION FOR THE CUSTODIAL FUND THIS YEAR OF ONE POINT FIVE MILLION.

IN OUR OPINION, IS NOT MODIFIED WITH RESPECT TO THAT RESTATEMENT.

MANAGEMENT ESTIMATES THAT ARE SIGNIFICANT ALLOWANCE FOR UNCOLLECTIBLE RECEIVABLES RELATED TO PROPERTY TAXES AND ANY OTHER ACCOUNTS RECEIVABLE ESTIMATES RELATED TO FOUNDATION'S SCHOOL PROGRAM AND THEN ALSO ESTIMATES RELATED TO INCURRED BUT NOT REPORTED HEALTH CARE AND WORKERS CLAIM WORKERS COMPENSATION CLAIMS AND ALSO THE DISTRICT'S PARTICIPATION IN TRS PENSION AND OPEB.

THERE IS A THIRD PARTY ESTIMATE PERTAINING TO THAT IS THAT IS SIGNIFICANT.

CERTAIN DISCLOSURES THAT ARE SIGNIFICANT, WHICH RELATES TO SENSITIVE ESTIMATES, NOTE 11, THE EMPLOYEES RETIREMENT PLAN, WHICH ALSO SHOULD INCLUDE REALLY THE OPEB PLAN AS WELL, AND ALSO COMMITMENTS AND CONTINGENCIES AND NOTE 12.

WE DID IDENTIFY A FEW UNCORRECTED MISSTATEMENTS THIS YEAR.

THESE ARE MISSTATEMENTS THAT WE'VE DETERMINED IN AGREEMENTS WITH MANAGEMENT THAT THEY ARE NOT MATERIAL TO THE FINANCIAL STATEMENT, JUST A FEW IN THE GENERAL FUND, ONE RELATED TO A PAYROLL TAX ACCRUAL, ONE RELATED TO CLASSIFICATION OF CERTAIN ITEMS AS DEFERRED INFLOWS VERSUS UNEARNED REVENUE, AND ALSO ABOUT ONE POINT FIVE MILLION IN ACCOUNTS RECEIVABLE.

AND SO THE NET IMPACT OF THESE UNCORRECTED MISSTATEMENTS IS ABOUT THREE MILLION OR LESS THAN ONE PERCENT OF THE FUND BALANCE OF THE GENERAL FUND AND HAS A ZERO DOLLAR IMPACT ON THE SPECIAL REVENUE FUND.

SOME OTHER ITEMS WENT ON TO NOTE MATERIAL ERRORS OTHER THAN THE ONES THAT WERE CORRECTED . IRREGULARITIES, NO ILLEGAL ACTS NOTED.

WE DID NOT IDENTIFY ANY TRANSACTIONS THAT LACK AUTHORITATIVE GUIDANCE.

WE HAD NO SIGNIFICANT DISAGREEMENTS WITH MANAGEMENT DURING THE COURSE OF OUR AUDIT.

WE IDENTIFIED NO INDEPENDENCE ISSUES AND WE IDENTIFIED NO CONSULTATIONS OR REQUEST FOR A SECOND OPINION FROM OTHER ACCOUNTANTS.

FEW FINANCIAL HIGHLIGHTS, THESE FINANCIAL HIGHLIGHTS ARE RELATED TO THE GOVERNMENTAL FUND FINANCIAL STATEMENTS.

SO HERE IS JUST A TREND ANALYSIS OF REVENUES BY SOURCE, AND YOU CAN SEE HERE THAT LOCAL AND INTERMEDIATE SOURCES BY FAR EXCEEDS THE STATE AND FEDERAL PROGRAM REVENUES, WHICH IS PRIMARILY PROPERTY TAX REVENUE AND STATE, STAYED FAIRLY CONSISTENT YEAR TO YEAR.

HERE'S JUST A YEAR OVER YEAR ANALYSIS AGAIN OF THE FEDERAL, STATE AND LOCAL PROGRAM REVENUES. AND YOU CAN SEE HERE AGAIN THAT LOCAL SOURCES REMAINS BY FAR THE LARGEST PROPORTION OF THAT.

A YEAR OVER YEAR COMPARISON OF EXPENDITURES, YOU CAN SEE HERE THAT IT STAYED FAIRLY CONSISTENT PERCENTAGE WISE BETWEEN EACH FUNCTION.

INSTRUCTIONAL SERVICES IS APPROXIMATELY 43 PERCENT THIS YEAR, WITH APPROXIMATELY 41 PERCENT THIS YEAR, WHICH IS STILL THE LARGEST FUNCTIONAL EXPENDITURE OF THE DISTRICT.

AND SO, AGAIN, A COMPARISON OF EXPENDITURES, EXCEPT OVER FIVE YEARS.

YOU CAN SEE THAT IT STAYED FAIRLY CONSISTENT, THE ONLY OUTLIER HERE WOULD BE THE DEBT SERVICE EXPENDITURES THERE, BUT THAT'S THOSE ARE FIXED PAYMENTS UNDER A DEBT SERVICE SCHEDULE. SO THAT WOULD BE EXPECTED.

THE GENERAL FUND BUDGET YOU CAN SEE HERE THERE'S THE ADOPTED, AMENDED AND IN THE ACTUAL THIS YEAR, THE ADOPTED BUDGET AND THE AMENDED BUDGET UNDER THE EXPENDITURE CATEGORY, THERE'S, YOU KNOW, A SIGNIFICANT FLUCTUATION.

HOWEVER, WE'RE SEEING THAT A LOT WITH THEIR SCHOOL DISTRICTS THIS YEAR, GIVEN THE UNCERTAINTY OF COVID AND HOW IMPACT THE DISTRICT'S FINANCIAL STATEMENTS.

GENERAL FUND BALANCE, THIS IS A PRETTY GOOD MEASURE OR A GOOD MANAGEMENT TOOL TO EVALUATE THE THE FINANCES OF THE DISTRICT.

YOU CAN SEE HERE THAT UNASSIGNED FUND BALANCE HERE HAS TRENDING UPWARD.

IT DECREASED SLIGHTLY THIS YEAR, BUT IT HAS BEEN TRENDING UPWARD AND IS APPROXIMATELY, YOU KNOW, 550 MILLION OR SO, WHICH IS A PRETTY HEALTHY FUND BALANCE TO HAVE.

[00:15:08]

SOME UPCOMING CHANGES THIS NEXT YEAR, THE DISTRICT WILL BE ADOPTING GASB 87 FOR LEASES.

THIS IS THE STANDARD UNDER GASB THAT ESTABLISHES A SINGLE MODEL FOR LEASE ACCOUNTING, AND SO THIS WILL HAVE A PRETTY SIGNIFICANT IMPACT TO THE DISTRICT'S FINANCIAL STATEMENTS.

AND I JUST WANT TO THANK THE BOARD AND SUPERINTENDENT HOUSE FOR HAVING US HERE TODAY AND SERVING AS THE DISTRICT'S FINANCIAL STATEMENT AUDITORS AND AT THIS TIME, IF THERE'S ANY QUESTIONS, I'D LIKE TO BE ABLE TO ANSWER THOSE FOR YOU AT THIS TIME.

THANK YOU SO MUCH FOR THE PRESENTATION, MR. ROGERS. COLLEAGUES, IF YOU CAN JUST RAISE YOUR HAND SINCE THERE'S FEW OF US IN THAT WAY, I CAN SEE WHO HAS QUESTIONS.

MS. LOGAN. JUST TAKING IT BACK TO THE MATERIAL WEAKNESS.

SO GREAT. GREAT JOB FOR THOSE THE PRIOR YEAR ONCE BEING REMEDIATED.

I THINK THAT'S PARTICULARLY AROUND THE LEASING.

THAT'S THAT'S REALLY DIFFICULT TO TO GET RIGHT.

SO, SO GREAT JOB FOR THAT.

ON THE MATERIAL WEAKNESS THIS YEAR, 10 MILLION WAS NOT CLASSIFIED AS IN-KIND OR WAS JUST MISSED BEING RECORDED IN GENERAL? IT WAS JUST MS. BEING REPORTED IN GENERAL.

AND SO THE PROGRAM IS JUST KIND OF.

YOU KNOW, CAME OUT OF NOWHERE AND THERE WAS A LOT OF CONFUSION.

YEAH. OKAY.

I'M OUT OF SCHOOL DISTRICTS ABOUT HOW TO RECORD THAT.

AND SO BUT YET THE PORTION THAT WAS RECORDED WAS THE WAS THE CASH PORTION.

YEAH, I BELIEVE THROUGH THE COUNTY AND FROM THE STATE.

AND SO THE PORTION WAS MISSED WAS THE WAS THE THE IN-KIND? YEAH. OK, NOW I THINK THAT'S FINE.

I JUST I JUST WANTED TO UNDERSTAND THE ROOT CAUSE AND MAKE SURE THAT THE DISTRICT IS WORKING ON, YOU KNOW, WORKING ON ADDRESSING THAT ROOT CAUSE.

AND IF THERE NEEDS TO BE TRAINING THAT THERE WILL BE TRAINING AND THINGS LIKE THAT.

I BELIEVE THAT WOULD BE TO OUR UNDERSTANDING, YES, THAT WILL BE REMEDIATED.

OK. TRUSTEE SUNG, SO I SEE THAT THIS AUDIT IS UNDER PROGRESS, HAS THE REPORT HAS NOT BEEN SENT TO US CORRECT? OH, ON OUR DESK.

OK, THANK YOU. OK.

YES, MA'AM, AND IT'S A SUBSTANTIALLY COMPLETE WE JUST HAVEN'T DATED THE REPORT YET BECAUSE WE'RE WAITING ON SOME JUST IN FINAL COMMUNICATION TO BE RETURNED TO US SO THAT WE CAN COMPLETE IT.

OK, THANK YOU, AND IT WAS SENT TO US FRIDAY AND IT CAME FROM WHO? FROM YOU OK, GREAT, THANK YOU.

AND THEN I HAD A QUESTION ABOUT, LET'S SEE.

ON PAGE 33 OF THE PRESENTATION, THE UNCORRECTED MISSTATEMENTS.

SO THIS IS A TYPICAL PRACTICE THAT YOU'RE BRINGING THESE TO OUR ATTENTION, BUT YOU DON'T FEEL THAT THEY RISE TO THE LEVEL WHERE THEY NEED TO BE CORRECTED IS THAT IN MY UNDERSTANDING OF IT CORRECTLY? YES, MA'AM. UNDER PROFESSIONAL STANDARD, CERTAIN MISSTATEMENTS OVER A CERTAIN LEVEL, WE'RE REQUIRED TO COMMUNICATE TO THE BOARD.

HOWEVER, THOSE WERE DEEMED IMMATERIAL, BUT AFTER COMMUNICATION BETWEEN US AND MANAGEMENT.

OK, THANK YOU.

AND THEN JUST TO FOLLOW UP ON THE PREVIOUS QUESTION ABOUT THE MATERIAL WEAKNESS THAT WAS FOUND, SUPERINTENDENT HOUSE IS THERE.

DO YOU OR ANYBODY IN THE ADMINISTRATION WANT TO ADDRESS HOW THAT'S BEING CORRECTED? SURE. CHIEF REED, IF YOU DON'T MIND JOINING US AT THE PODIUM, HE AND I TALKED A LITTLE BIT ABOUT THIS ON THURSDAY OR FRIDAY SPECIFICALLY, AND HE'LL HE'LL GIVE SOME ADDITIONAL INSIGHT AND REFERENCE TO WHERE WE ARE AND HISTORICALLY KIND OF SOME OF THE THINGS THAT THAT LED TO THIS PARTICULAR MOMENT IN TIME.

THANK YOU. GOOD MORNING.

I ALMOST SAID GOOD EVENING.

YEAH, I HAD A CONVERSATION WITH MR. HOUSE ABOUT THIS THIS MORNING.

OBVIOUSLY, IT IS CONCERNING TO HAVE A MATERIAL MISSTATEMENT ON THE HEELS AS WELL AS HAVING ONE LAST YEAR.

MY MAJOR MY MAIN CONCERNS EXPRESSED TO MR. HOUSE REALLY IS STAFFING.

I JUST, FOR EXAMPLE, WE JUST LOST OUR ASSISTANT CONTROLLER TWO WEEKS AGO.

THAT WAS A HUGE IMPACT TO OUR DIVISION.

[00:20:03]

BUT IN 18-19, THE COMPTROLLER'S OFFICE CUT 17 PEOPLE, 18 PERCENT OF THEIR DEPARTMENT AND PEOPLE TOWARD BUDGET CUTS.

AND THE COMPTROLLER EXPRESSED THAT I [INAUDIBLE] THE DOCUMENT THIS MORNING ON WHAT THOSE CONCERNS WERE. SO WE ARE HAVING SOME DISCUSSIONS, YOU KNOW, PROBABLY NOT GOING TO BRING BACK 17 PEOPLE, BUT WE'VE GOT SOME AREAS WHERE PEOPLE ARE OVERWHELMED AND THIS SIMPLY GOT MISSED, RIGHT.

INFORMATION WAS THERE, BUT IT JUST GOT MISSED.

SO, YOU KNOW, WE ARE GOING TO HAVE TO MAKE SOME, SOME SOME CHANGES TO WHERE FOLKS CAN ACTUALLY BE A LITTLE BIT ABOVE THE TREES AND ENSURING THAT SOME OF THESE THINGS THAT ARE UNUSUAL GET CAUGHT BECAUSE OF THE THINGS THAT HAVE OCCURRED IN THE PAST COUPLE OF YEARS HAVE BEEN THINGS THAT ARE UNUSUAL.

OK, SO YOU FEEL THAT THIS IS MORE OF A STAFFING ISSUE THAN A TRAINING ISSUE THEN? YES, I DO. OK.

OK, THANK YOU. THOSE ARE ALL MY QUESTIONS.

THANK YOU. TRUSTEE HERNANDEZ.

ONE QUESTION ON PAGE 41.

SO THE UNASSIGNED.

AND. HAS INCREASED SIGNIFICANTLY OVER TIME.

IS THAT SOMETHING THAT YOU'RE CONCERNED ABOUT, OR IS THAT SOMETHING THAT YOU THINK THAT IS SHOULD BE HAPPENING? WELL, THE ONE I REMEMBER BACK IN 2020 THAT WE KNEW THAT WAS GOING TO GO UP, PROBABLY BECAUSE WE PUT SOME SPENDING CONTROLS IN PLACE.

SO THAT JUMP THAT PURPLE ONE, THERE WAS REALLY BECAUSE WE CONTROL EXPENDITURES IN 21 AND FISCAL YEAR 2020 FOR THOSE LAST, WHAT, THREE MONTHS.

SO THAT WAS EXPECTED TO GO UP.

AND OF COURSE, THIS YEAR IT DID GO DOWN.

BUT SINCE TWENTY SEVENTEEN TO TWENTY TWENTY ONE, THERE'S STILL YEAH, IT IS STILL GONE UP.

A LOT OF THAT, REALLY. IT WAS FROM PRIOR YEAR PROPERTY VALUE AUDITS WHERE WE HAD VALUES GO DOWN AND WE WERE ABLE TO RECOUP SOME, SOME ONE TIME DOLLARS FROM THE STATE.

SO THE MAJORITY OF THAT WAS FROM FROM SOME ONE TIME DOLLARS.

OK. I WOULD THINK YOU.

MS. LOGAN. SO I DO WANT TO THANK YOU WHEN I WAS ASKING ABOUT ROOT CAUSE, THAT'S EXACTLY WHAT I WAS WAS HOPING TO HEAR.

SO, YOU KNOW, I THANK YOU FOR FOR GIVING THOUGHT TO THAT.

MY ONLY OTHER QUESTION IS, YOU KNOW, WITH THE LEASING STANDARD CHANGE GOING INTO 2021, THAT'S GOING TO THAT WILL CHANGE THE FINANCIAL STATEMENTS QUITE A BIT.

BUT THAT'S ALSO A BIT CONFUSING, EVEN FOR ME.

SO IS THAT SOMETHING THAT YOU'RE ALSO GOING TO FOCUS ON AND IS THERE TRAINING FOR FOR THE ACCOUNTING STAFF TO FIGURE OUT HOW TO HOW TO CLASSIFY THOSE AND THEN ALSO HOW TO GET THE INFORMATION FROM EVERYWHERE ELSE IN THE DISTRICT THAT'S DOING LEASING OVER TO YOU GUYS.

THOSE ARE THE KIND OF THE TWO AREAS THAT I SEE THAT CAUSED THE MOST ISSUES WITH THOSE STANDARD CHANGES.

YEAH, NO, ABSOLUTELY.

WE'VE BEEN TALKING ABOUT THIS GASB ANNOUNCEMENT FOR A WHILE.

YEAH, THERE THERE HAVE BEEN MULTIPLE TRAININGS OFFERED, YOU KNOW, NOT ONLY JUST OUR INTERNAL TEAM WORKING ON THIS, BUT ALSO THROUGH ORGANIZATIONS THAT WE'RE A MEMBER OF.

OK. SO YES, ABSOLUTELY.

EXCELLENT. OK. THAT WAS MY ONLY, THAT WAS MY QUESTION THANKS.

I HAVE A COUPLE OF QUESTIONS.

MR. ROGERS, YOU MENTIONED THAT TRY NO.

ON WHAT SLIDE THAT WE WERE CONSIDERED A HIGH RISK ENTITY AND WE'RE CURRENTLY NOT HIGH RISK. IS THAT CORRECT? ANY TIME A MATERIAL WEAKNESS IS IDENTIFIED, EITHER IN THE FINANCIAL STATEMENT AUDIT OR THE SINGLE AUDIT, YOU'RE CONSIDERED A HIGH RISK AUDITEE FOR TWO YEARS.

OK. UNTIL UNTIL YOU'VE GONE TWO FULL YEARS WITHOUT OBTAINING A MATERIAL WEAKNESS, YOU'LL YOU'LL CONTINUE TO REMAIN A HIGH RISK AUDITEE FOR AND THAT'S FOR A DETERMINATION OF MAJOR PROGRAMS UNDER THE SINGLE AUDIT.

OK, THAT'S VERY HELPFUL.

THANK YOU FOR THAT EXPLANATION.

AND THEN SLIDE 30, IF YOU DON'T MIND BREAKING DOWN A LITTLE MORE IN LAYMAN'S TERMS, THAT WOULD BE HELPFUL. REGARDING GASB 84? YES, MA'AM. SO PREVIOUSLY, THE DISTRICT HAD RECORDED ANY ACTIVITY THAT WOULD BE CONSIDERED CAMPUS RELATED OR STUDENT RELATED IN A FIDUCIARY FUND, AND SO THAT EXISTED IN THE FIDUCIARY FUND FINANCIAL STATEMENTS.

SO GATSBY 84, THE INTENTION THERE WAS TO CLARIFY OR PREVIOUS OLD GUIDANCE DIDN'T REALLY CLARIFY HOW TO CLASSIFY SUCH FUNDING FUNDING.

UM, NOW THERE IS A PARTICULAR SET OF CRITERIA TO GO BY.

[00:25:02]

AND SO THIS YEAR, AFTER EVALUATING FUNDS UNDER GASB 84, THE DISTRICT IDENTIFIED THAT A LARGE PORTION OF THAT ACTIVITY WAS REALLY CAMPUS RELATED UNDER THE CONTROL OF THE DISTRICT. AND SO THAT CAUSED THAT PORTION OF THE FUNDING TO BECOME A SPECIAL REVENUE FUND OR A PORTION OF THE SPECIAL REVENUE FUND.

AND SO UNDER SUCH CIRCUMSTANCES, YOU HAVE TO RESTATE BEGINNING FUND BALANCE TO CAPTURE THE CUMULATIVE EFFECT OF THAT.

OK, THAT'S VERY HELPFUL, THANK YOU.

OK, I THINK THOSE ARE ALL MY QUESTIONS.

COLLEAGUES, ANYTHING ELSE ON THIS? THANK YOU SO MUCH, MR. ROGERS.

THANK YOU ALL FOR HAVING ME.

OK, SO.

I THINK NEXT ON THE AGENDA, WE HAVE THE AUDIT COMMITTEE CHARTER ANNUAL REVIEW IN

[AUDIT COMMITTEE CHARTER ANNUAL REVIEW]

COLLEAGUES THAT WAS SENT TO YOU AHEAD OF TIME AND IF ANY OF YOU HAVE ANY SUGGESTED EDITS AT THIS TIME.

AND IN THE CHARTER, IT ASKS US TO REVIEW THIS INTERNAL AUDIT CHARTER ONCE A YEAR, AND THAT'S WHY WE'RE DOING THIS.

AND IT HAS WHEN WAS IT INITIALLY ADOPTED, TRUSTEE SUNG, DO YOU REMEMBER? I THINK IT'S IN HERE.

THE INITIAL ADOPTION PRECEDES ANY OF OUR SERVICE ON THE BOARD.

OKAY. AND AS A RESULT OF SUBSTANTIAL REVISIONS WITH THE AUDIT COMMITTEE CHARTER, OUR AUDIT COMMITTEE WORKED ON IN TWENTY EIGHTEEN TO ALIGN THE AUDIT COMMITTEE'S FUNCTION WITH THE BOARD ROLE PURSUANT TO LONESTAR GOVERNANCE.

SO THE AUDIT COMMITTEE WORKED REALLY HARD ON THESE REVISIONS AND MAKING THE LANGUAGE CONSISTENT WITH LONE STAR GOVERNANCE.

AND THE MAJOR CHANGE THERE IS THAT THE AUDIT COMMITTEE SERVES IN AN ADVISORY FUNCTION, SO IT'S NOT MAKING FINAL DECISIONS ON BEHALF OF THE BOARD, BUT IT IS MAKING RECOMMENDATIONS THAT THE BOARD CAN THEN CONSIDER AND DECIDE UPON.

AND THAT'S IN TERMS OF SUPERVISING AND EVALUATING MR. GARLAND, THE CHIEF AUDIT EXECUTIVE, AND.

AND AND EVEN SAY THAT THE [INAUDIBLE] THAT WE REVIEWED TODAY, RIGHT, THAT WE WERE REVIEWING IT, BUT IT ALSO GOES TO THE FULL BOARD SINCE THE BOARD IS THE ENTITY THAT CAN TAKE CAN TAKE FINAL ACTION.

OK, AND I DON'T HAVE ANY EDITS, BUT WANTED TO HIGHLIGHT A COUPLE OF THINGS THAT I THINK ADDRESS SOME OF THE ISSUES THAT WE'RE GOING TO DISCUSS TODAY.

SO ON PAGE? UM, WELL ON THIS DOCUMENT IT SAYS PACKET PAGE SEVENTY SIX, THERE'S SOME BULLET POINTS.

IT SAYS THE PURPOSE OF THE AUDIT COMMITTEE IS TO IN THE LAST TWO BULLET POINTS SAY, AND ASSIST IN OBTAINING EFFECT.

SORRY, SAY THAT AGAIN. OH, PAGE 47 OF THIS PACKET? OK, THANK YOU.

SO THE LAST TWO BULLETS SAY ASSIST IN OBTAINING EFFECTIVE CORRECTIVE ACTION AND NECESSARY IMPROVEMENT BASED UPON AUDIT FINDINGS AND RECOMMENDATIONS FROM EXTERNAL AND INTERNAL AUDITORS. AND THEN, THE LAST BULLET SAYS, PROVIDE THE BOARD IN THE PUBLIC WITH ADDITIONAL ASSURANCES THAT THE PRESCRIBED SYSTEMS OF INTERVENE AS INTENDED.

SO I THINK A COUPLE OF TOPICS THAT WE'RE GOING TO DISCUSS IN THIS MEETING MAY ADDRESS SOME OF THAT THAT I DON'T THINK IS CURRENTLY AS STRONG AS IT SHOULD BE.

AND THEN ANOTHER THING ON PAGE FOUR OF SEVEN OR AT LEAST ON THE I'M LOOKING AT THE ONLINE ONE, MAYBE I SHOULD LOOK AT THE PACKET.

PAGE 50 OF TODAY'S PACKET ON PAGE THREE, IT SAYS REVIEW THE INTERNAL AUDIT CHARTER, AT LEAST ON AN ANNUAL BASIS.

SO THAT WOULD BE NOT THIS AUDIT COMMITTEE CHARTER, BUT THE ACTUAL INTERNAL AUDIT CHARTER.

IS THAT CORRECT? AM I READING THAT CORRECTLY? SO I DON'T KNOW THAT WE'VE ACTUALLY DONE THAT RECENTLY, SO THAT MIGHT BE SOMETHING THAT WE DISCUSS AT A FUTURE MEETING.

WELL, MADAM CHAIR, WE DID REVIEW THE DEPARTMENT'S CHARTER AS WELL ABOUT THE SAME TIME AS WE REVIEWED THE AUDIT COMMITTEE CHARTER.

SO WE TYPICALLY DO THAT AROUND THE SAME TIME.

IS THAT WHAT YOU'RE SAYING? WELL, SINCE I'VE BEEN HERE, WE'VE ONLY DONE IT ONCE AND THAT

[00:30:02]

WAS ABOUT THE SAME TIME THAT WE DID.

OK, SO LET'S ADD THAT THEN TO THE NEXT AGENDA.

I THINK OUR NEXT MEETING WOULD BE IN JANUARY IF I'M CORRECT.

JANUARY OR FEBRUARY? IT'S BOTH CHARTERS OR JUST INTERNAL AUDIT.

OK. COLLEAGUES, ANY OTHER THOUGHTS ON THIS? OK, I CAN MOVE ON TO THE NEXT ITEM OF DISCUSSION.

OK. TRUSTEE SUNG JUST A REMINDER, AND IT'S SOMETHING THAT WE DISCUSS EVERY YEAR, BUT UNDER OTHER RESPONSIBILITIES, WE SAY THAT WE WILL EVALUATE THE COMMITTEES AND INDIVIDUAL MEMBERS PERFORMANCE ON A REGULAR BASIS.

AND THIS IS TYPICALLY SOMETHING THAT WE COME TO AT THE END OF THE YEAR AND ALWAYS RESOLVE TO DO BETTER ON THE NEXT YEAR.

AND I THINK MOSTLY WHAT WE'VE WE'VE DONE SO FAR IS TO EVALUATE OUR OWN ATTENDANCE, WHICH HAS BEEN EXCELLENT. BUT WE MAY ALSO WANT TO SAY FOR THE COMING YEAR, YOU KNOW, LOOK AT ARE THERE, IS THERE A TRAINING THAT WE WANT TO ACCOMPLISH DURING THE YEAR? ARE THERE OTHER THINGS THAT WE WANT TO MEASURE OURSELVES ON IN TERMS OF OUR OWN PERFORMANCE AS AUDIT COMMITTEE MEMBERS? YEAH, I APPRECIATE THAT TRUSTEE SUNG, BECAUSE I THINK, YEAH, LIKE LET'S RAISE THE BAR EACH YEAR AND ALWAYS WANT TO MAKE OURSELVES BETTER.

THAT DOES REMIND ME. TYPICALLY IN DECEMBER, WE PROVIDE LIKE A PRETTY EXTENSIVE REPORT.

IS THAT CORRECT TO THE FULL BOARD? CORRECT. SO I'LL BE WORKING ON THAT AND PROBABLY BE REACHING OUT TO YOU FOR SOME FEEDBACK. GREAT.

OK. ALL RIGHT, SO THE NEXT ITEM FOR DISCUSSION IS THE THREE EXPECTATIONS OF THE CHIEF

[THREE EXPECTATIONS OF CHIEF AUDIT EXECUTIVE’S ANNUAL EVALUATION]

AUDIT EXECUTIVE'S ANNUAL EVALUATION.

SO ON PAGE 55.

IS THIS WHAT YOU SUGGEST, CHIEF BLACKWELL? YES, I SUGGESTED IT TO THE AUDIT COMMITTEE.

OF COURSE, IF YOU NEED TO CHANGE THEM, IT'S UP TO YOU, OF COURSE.

OK. ANY DISCUSSION TRUSTEE SUNG.

ARE THESE A SUBSET OF THE DEPARTMENTAL GOALS THAT WE PREVIOUSLY APPROVED LAST MONTH? THE FIRST TWO ARE.

OK, I REMEMBER THOSE TWO.

SO THE THIRD ONE IS IS NOT.

YEAH, I'M JUST GIVING YOU A STATUS.

WE HAVE SOME POSITIONS THAT WE STILL NEED TO FILL.

THEY ARE IN ETHICS AND COMPLIANCE.

THE INTERNAL AUDIT TEAM IS FULLY FILLED AT THIS TIME.

SO THE FACT? SO AGAIN, TRUSTEE FULLY STAFFED.

YES. OK.

WHICH POSITIONS ARE ARE VACANT AND IN ETHICS AND COMPLIANCE? FOR ETHICS AND COMPLIANCE? THERESA. I KNOW THAT THERE ARE TWO, BUT SHE KNOWS THE EXACT TITLES.

THANK YOU. GOOD MORNING.

YEAH, CURRENTLY WE HAVE AN ANALYST POSITION OPEN AND A SPECIALIST POSITION OPEN, WHICH WE'VE BEEN WORKING ON WITH HR TO DETERMINE FOR SURE THAT THAT'S GOING TO BE THE TITLE.

OK. WE ARE INTERVIEWING FOR THE ANALYST, AND WE'RE STILL WORKING ON THE THE SPECIALIST POSITION WITH HR OR TALENT.

OKAY, GREAT.

VERY GOOD. THANK YOU. AND MR. BLACKWELL, IF YOU COULD TELL US A LITTLE BIT MORE ABOUT WHY YOU FEEL THAT THESE THREE EXPECTATIONS ARE THE ONES THAT MAKE THE MOST SENSE TO FOCUS ON? [INAUDIBLE] I WOULD SAY THE AUDIT PLAN IS THE MOST IMPORTANT TEST THAT WE HAVE.

TEAMMATE IS THE TOOL THAT WE USE DAILY, AND THE CURRENT VERSION THAT WE HAVE IS GOING BY THE WAYSIDE. SO THE VENDOR THAT PROVIDES TEAMMATE, THIS IS THEIR NEW VERSION TEAMMATE PLUS, AND IT'S ESSENTIAL THAT WE GET THAT INSTALLED 100 PERCENT BECAUSE IT AFFECTS OUR DAILY JOB. WE USE TEAMMATE EVERY SINGLE DAY.

OK. AND THEN.

ON OUR EVALUATION CALENDAR, ARE THESE ALL EXPECTATIONS WHERE IT'S WHERE YOU CAN DEMONSTRATE COMPLETION OR IN THE CASE OF THE AUDIT PLAN, THAT YOU ARE ON TRACK BY THE TIME WE EVALUATE YOU?

[00:35:01]

WELL, THE GOAL IS TO GET THE AUDIT PLAN DONE BY JUNE.

YES, AND WHEN I SAY DONE, I MEAN THAT WE AT LEAST HAVE DRAFT REPORTS OUT TO MANAGEMENT WAITING FOR THEM TO RESPOND BACK TO OUR RECOMMENDATIONS.

SO EITHER AUDITS ARE ALREADY COMPLETE OR THEY'RE IN MANAGEMENT'S HAND.

AND FOR TEAMMATE PLUS, OUR CURRENT PROJECTION IS TO HAVE THAT COMPLETE BY MARCH, END OF MARCH. IT MAY SPILL OVER INTO APRIL, BUT THE PLAN IS TO GET IT DONE BY MARCH.

OK, AND THEN I GUESS FOR THE THIRD BULLET, HAVING POSITIONS FILLED IS A PRETTY IS PRETTY EASY TO CHECK. YES.

OK. OK, VERY GOOD.

THOSE ARE ALL MY QUESTIONS, THANK YOU.

OK. I WOULD LIKE TO MAKE SOME SUGGESTIONS.

CHIEF BLACKWELL AND COLLEAGUES PLEASE WEIGH IN ON ON MY THOUGHTS.

SO FOR BULLET NUMBER ONE? THAT'S ALREADY PART OF YOUR EVALUATION.

IT'S NUMBER THREE, THE AUDIT PLAN, AND WE ASSESS YOU ON THAT.

AND THEN. I WOULD LIKE TO SEE AND I RECOGNIZE THAT IF WE'RE INTRODUCING SOMETHING AT THIS JUNCTURE THAT IT WOULD BE FROM NOW UNTIL THE END OF THE EVALUATION, LIKE WE WOULDN'T HAVE IT WOULDN'T BE FROM LIKE WHEN WE LAST EVALUATED YOU, RIGHT? BECAUSE I RECOGNIZE THAT WE'RE SIX MONTHS AWAY FROM YOUR EVALUATION.

SO IT WOULD BE STARTING NOW AND GOING TO THAT.

LIKE, WE'RE NOT GOING TO EVALUATE YOU ON SOMETHING WE DIDN'T TELL YOU ABOUT BEFORE.

AND THIS IS SOMETHING THAT I'VE BROUGHT UP TO YOU.

CHIEF BLACKWELL IS THE AND I KNOW WE'RE GOING TO TALK ABOUT IT A LITTLE MORE EXTENSIVELY, BUT THIS FOLLOWING UP RIGHT AND MAKING SURE THAT IF THERE'S YOU KNOW, WHAT ARE THE WEAKNESSES THAT IDENTIFIED THE THINGS THAT COME UP IN THE REPORTS? HOW DO WE ENSURE THAT THERE'S A SYSTEM IN PLACE THAT THESE THINGS ARE BEING ADDRESSED? I DID FIND ON THE DASHBOARD WHAT YOU HAD REFERRED TO, AND IT LOOKS LIKE A LOT OF THINGS HAVE NOT BEEN THERE WERE NO THERE WAS NO EVIDENCE PROVIDED.

I GUESS I SHOULD SAY THAT. SO COLLEAGUES, I WOULD SUGGEST HAVING SOMETHING IN THE EVALUATION AROUND THAT.

SECONDLY, ANOTHER THING I WOULD LIKE TO SEE, AND THAT'S SOMETHING I'VE BROUGHT UP TO YOU BEFORE AS WELL, IS A MORE ROBUST DASHBOARD.

I KNOW THAT THE DISTRICT USES POWER BI FOR OTHER DASHBOARDS BECAUSE I THINK WHAT'S CRITICAL FOR US ON THE COMMITTEE IS BEING ABLE TO SEE SOMETHING AT A GLANCE.

WHEN I GO INTO THE SHAREPOINT DASHBOARD, IT'S AND I'M VERY GRATEFUL FOR ALL OF THE WORK THAT WAS PUT INTO THAT. I THINK THAT IT WAS A STEP IN THE RIGHT DIRECTION, BUT YOU HAVE TO DO A LOT OF CLICKING TO GET TO JUST ONE PIECE OF INFORMATION, WHEREAS HOW CAN I SEE SOMETHING AT A GLANCE ALL AT ONCE AND MR. HOUSE IS THAT CORRECT THAT WE USE POWER BI FOR OTHER DASHBOARDS? DO YOU KNOW OFF THE TOP OF YOUR HEAD? YOU KNOW, I'M NOT CERTAIN OKAY FOR FOR SURE, BUT I CAN I CAN FIND OUT.

OK. OK.

THE ANSWER IS YES FROM OUR CHIEF TECHNOLOGY OFFICER.

ABSOLUTELY. THANK YOU, MR. GILHOUSEN. SO JUST WONDERED HOW EASY IT WOULD BE TO SHIFT, AND MAYBE THAT'S A QUESTION WE COULD GET ANSWERED RIGHT NOW.

WELL, WE'LL CONNECT AND AND TALK ABOUT WHAT WHAT THAT INTEGRATION MIGHT LOOK LIKE.

OK, THANK YOU SO MUCH.

ANOTHER THING I GUESS A COUPLE OF OTHER THINGS IS WE GET A LOT OF REPORTS SENT TO US.

AND I THINK, YOU KNOW, THE EXPECTATION IS THAT WE'RE READING THOSE.

IT WOULD BE HELPFUL, I THINK, TO HAVE SOMETHING WHERE YOU'RE IDENTIFYING.

YOU KNOW THIS, YOU SHOULD BE PAYING ATTENTION, YOU KNOW THIS THIS REPORT IN PARTICULAR HAS SOME VERY HIGH RISK AREAS.

SOMETHING TO THAT EFFECT, I THINK, COULD ALSO BE PART OF YOUR EVALUATION.

COLLEAGUE'S THOUGHTS ON THAT.

AND I HAVE A COMMENT TO OK.

AND DON'T FORGET TO RAISE YOUR HANDS.

MS. LOGAN, YEAH, I I THINK, YOU KNOW, TO YOUR TO YOUR LAST POINT, GARLAND, YOU ARE SITTING ON TOP OF SEEING, ALL OF THE REPORTS IN ALL OF THE WORK THAT'S BEING DONE ON BEHALF OF THE DISTRICT.

AND SO WHAT I REALLY WANT TO MAKE SURE IS THAT WHAT YOU SEE AS COMING IN AS BEING CONCERNING THAT YOU'RE YOU HAVE AN AVENUE TO ELEVATE IT TO THE COMMITTEE.

YOU KNOW, WE I READ ALL OF THE REPORTS.

I HAVE SOME QUESTIONS ON THEM, BUT I THINK THAT WOULD BE HELPFUL IF YOU TELL US AND PARTICULARLY TELL THE TRUSTEES WHAT YOU'RE CONCERNED ABOUT.

SO THERE'S A COUPLE OF WAYS TO DO THAT.

YOU CAN, YOU KNOW, YOU CAN PUT TOGETHER A SUMMARY AND SAY IN THE QUARTER, HERE'S THE

[00:40:01]

AUDITS THAT WE DID. HERE'S THE HERE'S THE FINDINGS THAT I CONSIDER HIGH RISK AND I WANT.

LET'S LET'S CHAT ABOUT THEM.

THAT'S ONE WAY TO DO IT.

ANOTHER WAY TO DO IT IS, AND THIS IS THIS WILL TAKE A LITTLE BIT MORE WORK.

SO I'M NOT SUGGESTING WE DO THAT THIS YEAR.

BUT A LOT OF DIFFERENT ORGANIZATIONS HAVE RATINGS MECHANISMS THAT WHEN YOU ISSUE A FINDING, A FINDING COULD EITHER BE RATED HIGH, MEDIUM OR LOW OR REALLY WHATEVER YOU WANT TO CALL IT. AND THEN THAT'S A GOOD FLAGGING SYSTEM FOR THE TRUSTEES TO BE ABLE TO GO IN AND EASILY SEE EITHER.

THIS WITH THIS FINDING IS RATED OR WHAT THIS AUDIT AREA IS RATED.

SO THERE'S KIND OF A COUPLE OF WAYS TO DO THAT AND WE CAN CHAT ABOUT THAT.

BUT YOU KNOW, JUST THINKING THROUGH YOU GUYS DO A LOT OF WORK.

YOU HAVE A LARGE BODY OF WORK THAT YOU DO IN THE AUDIT PLAN.

AND SO HOW DO YOU SIFT THROUGH EVERYTHING THAT'S COMING IN TO ELEVATE WHAT THEY NEED TO BE THINKING ABOUT AS IMPORTANT? AND I THINK THAT'S PERHAPS WHAT TRUSTEE CRUZ IS GETTING AT.

SO I WOULD LOVE TO CHAT THROUGH MECHANISMS ON THAT, BUT I THINK THAT'S WHERE IT WOULD BE VERY HELPFUL IF THAT CAME TOGETHER.

TRUSTEE SUNG. WELL, I'D LIKE TO HEAR CHIEF BLACKWELL'S THOUGHTS ON THE THE HIGH MEDIUM LOW. SO EARLIER THIS YEAR, I SENT AN EMAIL TO THE AUDIT COMMITTEE, MAYBE THE FULL BOARD.

SUGGESTING THE IDEA OF RIDDING EACH AUDIT FINDINGS IN THE AUDIT REPORT ITSELF.

MY LAST EMPLOYER WE USE, AND THIS WAS IMPOSED BY THE BOARD, ACTUALLY, WE RATED THEM SIGNIFICANT MODERATE AND MINOR SIGNIFICANT ISSUES HAPPEN EVERY NOW AND THEN, SO MOST OF THE AUDIT FINDINGS WERE EITHER MODERATE OR MINOR.

WE COULD INSTALL SOMETHING LIKE THAT FOR EACH AUDIT REPORT AT THE COMMITTEE'S PLEASURE.

THERE'S SOME OTHER SCHEME LIKE FOR US TO DO OR SOMETHING IN ADDITION TO THAT, WE CAN DO THAT AS WELL. SO I THINK I INDICATED SUPPORT FOR A FOR FOLLOWING THAT THAT SYSTEM, YOU SIGNIFICANT MODERATE OR ANY SIMILAR HIGH, MEDIUM LOW SYSTEM, SO I WOULD SUPPORT THAT. AND AND I THINK IT'S EXTREMELY VALUABLE, SUPERINTENDENT HOUSE, THAT YOU COME TO THESE AUDIT COMMITTEE MEETINGS SO THAT WE CAN THEN HAVE A CONVERSATION.

WE HAVE QUARTERLY AUDIT COMMITTEE MEETINGS.

AND YOU KNOW, THERE'S THE OPPORTUNITY ONCE WE HAVE THAT RATING SYSTEM IN PLACE FOR US TO DISCUSS, YOU KNOW, EACH QUARTER, YOU KNOW.

HERE ARE THE SIGNIFICANT THINGS THAT WE FOUND AND THEN WE CAN HAVE A CONVERSATION ABOUT THIS. SO WHAT? SO WHAT DO WE DO ABOUT WHAT WE'VE WE'VE DISCOVERED THAT'S HIGH RISK.

SO I THINK ALL OF THE SUGGESTIONS THAT YOU'VE RAISED TRUSTEE CRUZ ARE ARE VALUABLE.

YOU KNOW, WE'VE HAD A DASHBOARD AS A AS ONE OF OUR EXPECTATIONS PREVIOUSLY.

I THINK IT WAS A MAJOR EXPECTATION IN TWENTY EIGHTEEN AND TWENTY NINETEEN OR MAYBE TWENTY NINETEEN, TWENTY TWENTY, YOU KNOW, SYSTEMS FOR FOLLOW UP DASHBOARD.

THESE ARE ALL LOOKING AT WHERE AUDIT REPORTS THEN TURN INTO INFORMED ACTION BY OUR ADMINISTRATION.

AND JUST WANT TO MAKE SURE THAT WE INCLUDE SUPERINTENDENT HOUSE IN THIS DISCUSSION BECAUSE IF WE'RE SETTING IT AS AN EXPECTATION, THESE ARE NOT THINGS THAT MR. BLACKWELL CAN DO BY HIMSELF.

IT REALLY REQUIRES JOINT ACTION BY OUR AUDIT TEAM AND BY OUR ADMINISTRATION.

IN TERMS OF WHAT EXPECTATIONS TO APPROVE, I I I THINK THESE ARE IMPORTANT THINGS THAT CHIEF BLACKWELL NEEDS TO ACCOMPLISH, I DON'T MIND ACTUALLY DUPLICATING COMPLETION OF THE AUDIT PLAN BECAUSE THAT'S SOMETHING WE HAVEN'T BEEN ABLE TO ACHIEVE THE LAST FEW YEARS.

SO WHILE IT IS ALREADY IN THE VALUATION, DOUBLING DOWN ON IT AND HAVING IT COUNT DOUBLE THIS YEAR, I THINK IS APPROPRIATE.

BUT I WOULD BE OPEN TO TO AN EXPECTATION THAT BRINGS IN THAT COORDINATION BETWEEN AUDIT AND OUR ADMINISTRATION.

IF IF SUPERINTENDENT HOUSE IS SUPPORTIVE AND AND COMMITTED TO THAT AS WELL, I AM AND JUSTIFY WHY WE HAVE MR. BLACKWELL AND I HAVE SET UP TIME SO THAT WE CAN ON A MONTHLY BASIS, CONNECT TO TO TALK ABOUT KIND OF THE PROGRESSION OR OR ANY TYPE OF INFORMATION THAT WOULD BE ABOUT IMPROVEMENT IN THE DEPARTMENT.

SO WE'LL CONTINUE TO COMMIT TO DO THAT AND CONTINUE TO COMMUNICATE ON A ON A MONTHLY BASIS TO ENSURE THAT WE ONLY GET BETTER OVER THE COURSE OF TIME.

[00:45:03]

VERY GOOD. SO THEN GIVEN GIVEN THAT OUT OF THE KIND OF THREE AREAS THAT THAT OUR CHAIR OUTLINED IS THERE IS THERE ONE, MR. BLACKWELL THAT YOU WOULD REALLY LIKE TO DIG INTO THIS YEAR, THE REMAINING HALF A YEAR THAT WE HAVE, EVERYTHING IS IMPORTANT.

I THINK I WOULD JUST NEED.

DIRECTION FROM THE COMMITTEE, FOR EXAMPLE, THESE THREE ARE NOT WHAT YOU'RE LOOKING FOR.

TELL ME WHICH ONES ARE.

SO WE HAD WE HAVE GOALS, MAYBE SOMETHING IN OUR LIST OF GOALS CAN SUPPLY SOMETHING THAT'S IN THE EXPECTATIONS.

UM. SO I WOULD JUST ADD, I THINK.

THE THINGS YOU LISTED, I MEAN, THE I THINK PART OF THE THE REASON I BROUGHT UP THESE OTHERS IS WE WANT TO CONSTANTLY CHALLENGE THE ORGANIZATION, RIGHT? HOW DO WE TAKE IT TO THE NEXT LEVEL? AND I FEEL LIKE. THE TWO, AT LEAST, YOU KNOW, THE SECOND AND THE THIRD ARE THINGS THAT FEEL LIKE YOU WERE GOING TO COMPLETE ANYWAY.

AND SO I DO AGREE TRUSTEE SUNG, I THINK DOUBLING DOWN, YOU KNOW, HAVING THAT COUNT TWICE, SO TO SPEAK ON THE EVALUATION OF COMPLETING THE AUDIT PLAN WOULD BE CRITICAL.

BUT I WOULD LIKE TO SEE SOMETHING THAT CHALLENGES AND BRINGS US TO ANOTHER LEVEL.

AND SO I THINK TRUSTEE SUNG WORDED IT WHERE THERE'S MORE COORDINATION BETWEEN THE ADMINISTRATION AND YOUR DEPARTMENT ON, YOU KNOW, THESE FOLLOW UPS PROVIDING EVIDENCE THAT THE MATERIAL WEAKNESSES OR ANY FINDINGS THAT YOU'RE FINDING IN THE AUDIT REPORTS ARE ACTUALLY ADDRESSED BECAUSE FROM WHAT I COULD SEE IN THE DASHBOARD AT A QUICK GLANCE WAS THERE'S NOT A LOT OF EVIDENCE BEING PROVIDED.

AND SO, YOU KNOW, PARTICULARLY FOR THE ONES THAT ARE OF SIGNIFICANT RISKS, LIKE YOU MENTIONED HAVING THAT MECHANISM TO REPORT THAT TO US.

SO. THOSE ARE MY THOUGHTS.

OK, SO IF I UNDERSTAND YOU, MADAM CHAIR, YOU PERHAPS WANT TO REPLACE THE SECOND ONE WITH THE DASHBOARD BEING CURRENT AND UP TO DATE AT ALL TIMES.

WELL, I THINK THAT MAYBE NOT SO SPECIFIC, ONLY BECAUSE IT'S GOING TO TAKE SOME COORDINATION AND AT THE JUNCTURE THAT WE ARE.

THAT WOULD BE THE GOAL, RIGHT? BUT ULTIMATELY, I THINK MAYBE IT'S THE COORDINATION BETWEEN, YOU KNOW, MAKING SURE THAT THE FOLLOW UP ACTUALLY HAPPENS.

OK, SO SUPERINTENDENT HOUSE, WE USUALLY GIVE 10 BUSINESS DAYS FOR MANAGEMENT TO PROVIDE US EVIDENCE OF RECOMMENDATION IMPLEMENTATION.

AND ONE OF THE TOOLS WE USE IS AN AUDIT DASHBOARD, AND THAT'S WHERE A MANAGER CAN UPLOAD EVIDENCE AND TO SHOW THAT COMPLETION ONCE UPLOADED, MY TEAM REVIEWS IT TO SEE IF IT RANG THE BELL, SO TO SPEAK.

AND IF SO, FINE, IF NOT, WE GO BACK TO MANAGEMENT SAYING YOU NEED A BETTER RESPONSE.

IS THAT IS THAT CURRENT UPLOAD A PART OF THE SHAREPOINT DASHBOARD RIGHT NOW WHERE IT CAN BE ACCESSED, I SEE SHAKING OF HEADS BEHIND YOU.

SO IT IS. YES.

GOT IT. BUT WHAT I HEAR COMING FROM THE DYAS RIGHT NOW IS THAT IT'S THE PLATFORM.

YEAH, A PLATFORM THAT THAT MAKES IT A LITTLE BIT EASIER TO TO NAVIGATE.

AND MR. GILHOUSEN AND I WILL, WE'LL TAKE A CLOSE LOOK AT WHAT THAT MIGHT LOOK LIKE.

OK. ALL RIGHT. SEE, WE GOT A JOB TO DO.

OK. SO LEE ON MY TEAM WILL HELP WORK TO GET US TO WHERE YOU ALL SAID YOU'D LIKE FOR US TO BE. OK.

TRUSTEE SUNG, SO COULD I PROPOSE? I THINK THAT. BEFORE WE ADOPT THESE EXPECTATIONS, THEY NEED TO GO TO THE FULL BOARD, COULD I PROPOSE THAT OUR CHAIR, TRUSTEE CRUZ, FOLLOW UP WITH CHIEF BLACKWELL AND SUPERINTENDENT HOUSE AND DROPPED SOME LANGUAGE HERE FOR THE EXPECTATION THAT WOULD MAKE IT CLEAR WHAT CHIEF BLACKWELL IS TRYING TO ACHIEVE.

WITH SUPPORT FROM THE ADMINISTRATION, SO I THINK SUPERINTENDED HOUSE NEEDS TO UNDERSTAND WHAT HE'S COMMITTING TO SUPPORT AS WELL.

AND IF YOU COULD DRAFT SOMETHING TO REPLACE MAYBE THE SECOND BULLET HERE AND THEN BRING

[00:50:01]

IT BACK TO THE TO THE FULL BOARD? OK. AND WHEN IS THAT FOR THIS THURSDAY OR FOR NEXT MONTH? TRUSTEE SUNG, DO YOU KNOW? I THINK TYPICALLY IT GOES TO THE BOARD THE NEXT MONTH.

YEAH, WE'RE ON TWO SHORT OF A TIMELINE TO GET IT INTO THE BOARD FOR THIS THURSDAY WE'VE ALREADY POSTED FOR.

OKAY. THE EXPECTATIONS AREN'T EVEN ON THE AGENDA FOR THIS.

I DON'T THINK THEY ARE. THEY'RE NOT GOING TO MAKE SURE.

OK. YEAH. MAYBE IN A PREVIOUS MONTH AND THE KID CAME BACK TO THE COMMITTEE.

UPDATING THE EVALUATION.

DO THIS AS A SEPARATE AGENDA ITEM, SO YOU WOULD HAVE TO THE ANNUAL REPORT AND RECOMMENDATIONS. AND THEN THIS WOULD BE A SEPARATE STANDALONE SO IT DOESN'T GET MISSED.

OKAY. AND WE'VE DONE THAT IN PREVIOUS YEARS.

IT'S NOT OKAY.

YEAH, IT'S NOT WITHOUT PRECEDENT THAT WE'VE TAKEN UNTIL DECEMBER TO FINALIZE THE EXPECTATIONS. YEAH.

OK. SO A FOLLOW UP WITH YOU, CHIEF BLACKWELL AND MR. HOUSE. OKAY. SO I CAN SEND REPLACEMENT ITEMS FOR THE SECOND AND THIRD BULLETS FOR YOU TO CONSIDER. I'LL GIVE YOU FOUR OR FIVE, MAYBE PICK TWO TO REPLACE TWO.

OK, WE'LL DO THAT TODAY.

THANK YOU. OK, SO THANK YOU, EVERYONE FOR THAT DISCUSSION.

NEXT ON THE AGENDA, WE HAVE INTRODUCING YOUR NEW STAFF MEMBER.

[INTRODUCE THE NEW FINANCIAL AND OPERATIONAL AUDIT MANAGER]

YES. SO AS YOU YOU KNOW, WE LOST THE MANAGER AT NEAR THE END OF MAY, AND WE HAVE SINCE FILLED THAT VACANT POSITION WITH OURSELVES.

AND I'LL LET YOU GO AHEAD AND INTRODUCE YOURSELF.

GOOD MORNING, TRUSTEE. AND OF COURSE, YOU CAME TO KNOW MY NAME.

I'M [INAUDIBLE].

I'VE BEEN IN THE FIELD OF AUDITING FOR ALMOST 30 YEARS.

FROM FINANCIAL AUDIT, EXTERNAL AUDIT TO INTERNAL AUDIT, VARIOUS POSITIONS FROM SENIOR AUDIT MANAGER, I HAVE LED THE INTERNAL AUDIT TEAM FOR ALMOST EIGHT YEARS IN DIFFERENT ORGANIZATION. TWO YEARS IN TEXAS MEDICAL CENTER AND SIX YEARS ABROAD.

I WAS IN UAE. I'M CERTIFIED.

I'VE GOT CPA, CISA, CFE.

THAT'S PRETTY MUCH ME IN A NUTSHELL.

I MEAN, IF YOU HAVE ANY QUESTIONS, I'M THERE TO ANSWER.

WELL, THANK YOU SO MUCH.

THANK YOU SO MUCH. THANK YOU.

I THINK [INAUDIBLE] A GREAT ADDITION TO OUR TEAM, AND WHILE HE'S STILL NEW, WE HAVE GREAT, TREMENDOUS PROFIT PROMISE FOR HIM.

AND SO FAR, I CERTAINLY ENJOY WORKING WITH HIM.

HE'S A GREAT ADDITION TO OUR TEAM.

I WILL GIVE YOU THE STATUS OF THE 2021 ORDER PLAN.

[UPDATE ON THE STATUS OF THE 2021 INTERNAL AUDIT PLAN]

THIS IS A SUMMARY CHART, AND WE'LL GO INTO A BIT MORE DETAIL ON THE NEXT PAGE.

ARE THERE ANY QUESTIONS? SO JUST TO CLARIFY, THESE WERE SUPPOSED TO BE DONE AT WHAT POINT IN JUNE? IDEALLY JUNE 30.

OF 2021? CORRECT.

WERE THERE ANY, CHIEF BLACKWELL, THAT YOU DIDN'T CARRY OVER THAT WERE NOT COMPLETED? WE DIDN'T NECESSARILY CARRYOVER, PER SAY, BUT WE HAVEN'T REJECTED RESPONSIBILITY FOR THEM EITHER. WE TAKE THOSE AUDITS SERIOUSLY.

WE'RE WORKING ON THEM.

WE'RE TRYING TO GET THEM ALL COMPLETE AND WE'RE ALMOST THERE.

AS I REPORTED TO YOU LAST SAW THE COMMITTEE MEETING THE FINANCIAL AND OPERATIONAL AREA WAS COMPLETE AT THAT TIME.

SO IT'S THE OTHER TWO AREAS ON MY TEAM THAT WE'RE STILL WORKING ON AND WE'RE IN THE REPORTING PHASE, MOSTLY FOR THOSE.

ARE THERE ANY FROM PRIOR AUDIT PLAN YEARS? NO. ANY IN THOSE AREAS THAT GOT CARRIED FORWARD AT THE AUDIT COMMITTEE'S DIRECTION OR APPROVAL. SO LIKE PRIOR TO AUDIT PLAN 2021, THERE AREN'T ANY AUDITS FROM 2019 OR 2018 OR

[00:55:04]

ANYTHING LIKE THAT? IN THE CONSTRUCTION AREA.

WE HAVE A LITTLE BIT, BUT NOT MUCH AT ALL TO SPEAK OF ACROSS THE PRACTICE AREAS.

DO YOU KNOW HOW OLD THE OLDEST ONE IS? I'D HAVE TO GET BACK TO YOU ON THAT ONE.

BUT IT WOULD BE PROBABLY FROM CONSTRUCTION IN 2019.

AND WHEN DO YOU THINK THAT YOU WILL BE DONE WITH THE 2021 AUDIT? THE GOAL IS TO GET THEM DONE AS SOON AS POSSIBLE, BUT WITH THE HOLIDAYS COMING UP AND EVERYTHING, WE SHOULD BE TO HAVE THOSE ISSUED BY EITHER LATE NOVEMBER OR DECEMBER . BECAUSE WE'RE IN THE REPORTING PHASE NOW, SO WE SHOULD BE ABLE TO GET THOSE FINALIZED BEFORE THEN. MS. LOGAN? SO IF I'M LOOKING AT THE DASHBOARD, 23 COMPLETE, 11 IN REPORTING.

IS THAT THE WHOLE PLAN FOR 2021 OR ARE THERE CARRYOVERS OUTSIDE OF THAT BUCKET THAT GO TO 2022? WE HAVE NOT IDENTIFIED ANY CARRYOVERS PER SAY IN THE 2022, WE JUST CONTINUED TO WORK ON 2021 AND GET THEM INTO THE REPORTING PHASE AS BEST WE CAN.

WE DIDN'T OFFICIALLY ASK THE BOARD FOR APPROVAL TO CARRY OVER, PER SAY.

OK. UM.

SOME OF THE CONSTRUCTION ONES DO LOOK LIKE IT'S 2020 TO CARRY OVER AUDIT.

ARE THOSE ONES, I THINK THERE ARE FOUR OF THEM.

ARE THOSE ONES COUNTED IN THE 23 COMPLETED AND 11 IN PROGRESS? I THINK IT'S A COUPLE OF PAGES DOWN ON THE EXCEL LOOKING.

YES, IF YOU GO.

SO YOU CAN SEE THE STATUS OF THE CONSTRUCTION ONES FOR THE 2021 AUDIT PLAN.

AND SO THESE WOULDN'T REPRESENT ANY THAT WERE FROM PRIOR YEARS THAT WE CONTINUE TO WORK ON. OK. AND THEN ONE MORE DOWN, IT LOOKS LIKE THERE'S A LIST OF, I THINK, PAGE SIXTY THREE. SO THESE ONES SO THOSE FOUR SCHOOLS ARE HARVEY SCHOOLS FROM HURRICANE HARVEY, GOT IT. OK, OK.

OK. I JUST.

UM. YOU KNOW, I THINK.

AND NOT TO CUT YOU OFF.

THE SLOGAN, BUT I'M ACTUALLY REVIEWING THE AUDIT REPORT FOR THAT ONE RIGHT NOW.

OH, YOU ARE. OK, SO SO THESE ONES THAT SAY 2020 CARRY OVER ARE IN THE 11 THAT YOU'RE INTERVIEWING. OK.

THAT'S WHAT I'M STARTING TO REVIEW.

THAT'S WHAT I'M CURIOUS ABOUT. NO, THAT'S GREAT NEWS.

OK. THAT WAS MY QUESTION.

OKAY. WE'VE BEEN JOINED BY TRUSTEE FLYNN VILASECA.

MY COLLEAGUES, ANY OTHER QUESTIONS ON THE 2021 AUDIT PLAN? AND THESE ARE ALL ON THE WEBSITE.

SO, YOU KNOW, I'M GRATEFUL THAT WE GET THEM EMAILED TO US AS WELL, BUT IT'S GOOD FOR THE PUBLIC. TRUSTEE SUNG? YEAH, I'M A LITTLE SURPRISED THAT WE'RE STILL SO DEEP INTO THE 2021 AUDIT PLAN BECAUSE I HAD BEEN UNDER THE IMPRESSION THAT WE WERE GOING TO START WITH THE NEXT YEAR AUDIT PLAN AND CARRY OVER WHAT WE NEEDED TO CARRY OVER, BUT THAT WE WOULD BE STARTING FRESH WITH A NEW AUDIT PLAN, THE 21-22.

SO IT'S WHAT HAPPENED HERE IS THAT THESE WERE ALL AUDITS THAT WERE COME JUNE 30.

THEY WERE ALREADY UNDERWAY.

THEY WERE WE WERE ALREADY KIND OF HALFWAY THROUGH THEM.

AND SO WE'RE FINISHING THEM OUT.

RIGHT? OK. AND THEN NONE OF THESE 2021 AUDITS.

SO ARE YOU ALREADY ANSWERED THAT QUESTION? NONE OF THEM ARE CARRYING OVER INTO THE 21-22.

OK. OK, THANK YOU.

I DON'T HAVE ANY FURTHER QUESTIONS.

OK, WELL, WHAT'S BEFORE YOU ANNOUNCE A LIST OF ORDERS THAT WE'VE ISSUED SINCE JULY ONE? OBVIOUSLY, SOME OF THESE ARE FROM THE PRIOR YEARS THAT WE WERE JUST HAVING A DISCUSSION ABOUT. SO YOUR AUDIT TEAM HAS BEEN VERY PRODUCTIVE SINCE JUNE 30, AND WE JUST CONTINUE TO PUT OUR BEST FOOT FORWARD STEP BY STEP TO GET THE WORK DONE THAT YOU ALL ASKED US TO DO.

[UPDATE ON THE STATUS OF THE 2022 INTERNAL AUDIT PLAN]

A QUICK PICTORIAL FOR WHERE WE ARE ON TWENTY TWENTY TWO AUDITS.

OBVIOUSLY, WE'RE IN THE SECOND QUARTER NOW.

[01:00:02]

WE'D LIKE TO BE FURTHER BEYOND WHERE WE WERE SHOWING OURSELVES.

HOWEVER, WE DID HAVE THE TWENTY TWENTY ONE THAT WE FOCUS ON, AS YOU COULD SEE ON THE LIST OF AUDITS THAT WERE IN THE PRIOR SLIDE.

THESE ARE THE SITUATION BY PRACTICE AREA.

THESE ARE THE 22 AUDITS THAT WE HAVE FOR THIS FISCAL YEAR.

YOU CAN SEE THE STATUS OF EACH ONE ON THE RIGHT COLUMN.

SO THIS IS THE EDUCATION PROGRAMS AREA.

AND WHERE THEY ARE RIGHT NOW IS ABOUT WHERE I WOULD EXPECT THEM TO BE.

THE AUDIT HAS NOT STARTED YET, BUT WE EXPECT THAT ONE TO START IN DECEMBER.

AND WE HAVE TWO CONSTRUCTION SERVICES AUDIT AREA.

AND THEN MIGRATING OVER INTO THE FINANCIAL AND OPERATIONAL AREA.

CHIEF BLACKWELL, WHAT PERCENTAGE OF THESE ARE DONE BY THIRD PARTY AND HOW WHAT PERCENTAGE ARE DONE BY YOUR? I DON'T HAVE THAT FORMALLY CALCULATED, BUT MY ROUGH GUESS WOULD BE ABOUT MAYBE A FIFTH 20 PERCENT.

20 PERCENT DONE BY THIRD PARTY? CORRECT. OKAY. THE MAJORITY OF OUR AUDITS ARE DONE BY THE AUDIT TEAM.

OKAY. FOR EXAMPLE, ON THIS ONE, YOU SEE, THAT'S ONE THAT WE, YOU AND I BOTH AGREED TO OUTSOURCE THAT ONE.

AND THE FIRM INTENDS TO START THAT ONE IN DECEMBER.

OKAY. I ALSO OUTSOURCED THE [INAUDIBLE] FOLLOW UP ITEMS SO THE MEDICAL TEAM COULD JUST FOCUS ON THE REAL AUDITS.

THE FOLLOW UP AUDITS TEND TO BE THE EASIEST AUDITS.

BUT I WANTED MY TEAM TO LOOK AT THE HARDEST ONES.

THE FIRM CAME VERY QUICKLY, DISPENSED WITH THE LBB FOLLOW UP ITEMS. AND THEY ARE ENGAGED IN THAT RIGHT NOW.

LIST OF ART AUDITS.

THE PRO CART AUDIT IS UNDERWAY RIGHT NOW.

ONCE THAT ONE IS COMPLETE, THE AUDITOR WILL MIGRATE INTO TRANSPORTATION SYSTEMS AUDIT.

COLLEAGUES, ANY QUESTIONS ON THIS AUDIT PLAN? SO YOU YOU STATED, MR. BLACKWELL, THAT THIS IS WHERE YOU EXPECTED TO BE WITH THE 2022 AUDIT PLAN AT THIS POINT

[STATUS OF OFFICE OF INTERNAL AUDIT 2020–2021 GOALS & STATUS OF OFFICE OF INTERNAL AUDIT 2021–2022 GOALS]

IN TIME. SO DOES THAT MEAN THAT BY JUNE 30TH THE 2022 AUDIT PLAN WILL BE COMPLETED? THAT'S THE GOAL, AND I'M PUSHING HARD FOR THAT EVERY SINGLE DAY.

I KNOW IS THAT A REALISTIC EXPECTATION THAT WE WILL HAVE THE 2022 AUDIT PLAN COMPLETED BY JUNE 30TH? I'VE TOLD MY TEAM THAT IT IS A MUST BE DONE.

NO, NO OPTIONS ON THIS ONE.

IT MUST BE DONE.

THANK YOU. MS. LOGAN? ARE THERE ANY ADDITIONAL RESOURCES THAT YOU NEED FROM ADMINISTRATION OR FROM THE DISTRICT TO GET THE AUDIT PLAN COMPLETED? NOT AT THIS TIME.

THE FUNDS THAT I REQUEST FROM DR.

LEIGHTON GAVE US THAT PATCH THAT WE NEED IT AND WE'RE EXECUTING IT NOW.

OK. JUST ALWAYS LIKE TO ASK THAT FOR THE AUDITS THAT YOU HAVE COMPLETED OVER 21 AND NOW 22.

IS THERE ANYTHING THAT YOU FEEL THAT YOU'VE FOUND THAT'S PARTICULARLY CONCERNING THAT YOU NEED TO ELEVATE TO THE TRUSTEES? OR IS THAT MAYBE A CLOSED SESSION TOPIC? I DON'T KNOW. I WILL SAY WHEN WE GET INTO CLOSED SESSION, OK, OK, I JUST WANT TO MAKE SURE THAT THAT'S HAPPENING AND YOU GUYS ARE GETTING THAT INFORMATION.

TRUSTEE FLYNN VILASECA, THANK YOU, AND I THANK YOU AGAIN FOR THE PRESENTATION.

SIMILAR TO WHAT OUR COMMUNITY MEMBER WAS SAYING ABOUT ANY ADDITIONAL RESOURCES OR

[01:05:02]

SUPPORTS NEEDED FROM THE DISTRICT, ARE THERE ANY ROADBLOCKS THAT WOULD PROHIBIT YOU FROM GETTING THE AUDIT PLAN COMPLETED? AND THEN HOW WOULD WE, THE COMMITTEE, BE ABLE TO SUPPORT YOU? HOW WOULD THE DISTRICT BE ABLE TO SUPPORT YOU TO MAKE SURE THAT THE PLAN IS COMPLETED? ARE THERE ANY RESPONSES FROM THE ADMINISTRATIVE SIDE THAT ARE TAKING LONGER? IS THERE? I MEAN, JUST THAT'S AN EXAMPLE POTENTIALLY; RIGHT? IS THERE ANYTHING THAT WE CAN DO TO SUPPORT YOU BECAUSE THIS HAS BEEN A PRIORITY AND WE KNOW THAT THERE HAVE BEEN SOME ROADBLOCKS IN THE PAST, BUT STAYING FOCUSED ON SORT OF WHAT'S WORKING, ALSO HOW WE CAN HELP SUPPORT.

WE JUST WANT TO BE ABLE TO MAKE SURE THAT THIS IS SOMETHING THAT AND I KNOW THAT, YOU KNOW, IT'S A PRIORITY AS WELL.

SO TRUSTEE, I WOULD SAY THAT.

WE HAVE ONE PERSON WHO'S OUT DUE TO COVID AND HAS BEEN FOR A COUPLE OF MONTHS NOW.

I HAVE NOT HIRED A OUTSIDE STAFF PERSON TO FILL THAT VOID.

UM, AND I DO EXPECT HER BACK SOON.

SO IF WE CAN GET BACK ON TRACK WITH HER WORKLOAD.

I THINK WE'LL BE OK.

THE SECOND THING IS WE GIVE MANAGEMENT 10 BUSINESS DAYS TO RESPOND TO OUR REPORTS.

THAT DOESN'T ALWAYS HAPPEN, BUT I UNDERSTAND THAT MANAGEMENT'S EXTREMELY BUSY AND IT'S BEEN THAT WAY EVERY AUDIT DEPARTMENT I'VE EVER WORKED IN, SO WE HAVE TO WORK WITH MANAGEMENT AS BEST WE CAN TO GET WHAT WE NEED WITHOUT OVERBURDENING THEM AT THE SAME TIME. SO THAT DELICATE BALANCE IS WHAT I'M ALWAYS WORKING WITH.

BUT OTHERWISE, I THINK THE ADMINISTRATION IS VERY SUPPORTIVE OF INTERNAL AUDIT.

OK, NOW, THANK YOU FOR THAT ADDITIONAL INFORMATION, I KNOW WORKING WITH THE TEAM THAT'S LEANER, GIVEN THE CHALLENGES THAT WE HAVE WITH COVID.

ARE YOU ABLE TO ACCESS FILES? BECAUSE I REMEMBER LAST YEAR THERE WAS SOME ISSUES WHEN WE FIRST HEARD.

HOW LONG ARE WE? HAVE WE BEEN UNCOVERED A YEAR HERE AND A HALF NOW? TWO YEARS? YEAH, YEAH, THERE.

THERE WERE SOME ISSUES THERE WHEN WE WERE ALL VIRTUAL.

SO I JUST WANT TO AGAIN, IF THERE'S ANYTHING LIKE THAT GOING ON, THAT SUPERINTENDENT HOUSE KNOWS THAT WE KNOW.

SO THAT AGAIN, THAT THOSE ROADBLOCKS CAN BE REMOVED SO THAT YOU AND YOUR TEAM CAN BE SUCCESSFUL. SO IF SUPERINTENDENT HOUSE, IF THERE'S ANYTHING NEW, WE HAVE REGULAR MEETINGS THAT WILL BRING ANYTHING TO YOUR ATTENTION THAT I FEEL WE NEED TO WORK ON AS A TEAM.

BUT I THINK THE EXECUTIVES ARE DOING A REALLY GOOD JOB OVERALL.

AND WE AGAIN TRUSTEES AND MEMBERS OF THE COMMITTEE.

THIS IS SOMETHING THAT MR. GARLAND BLACKWELL AND I CONTINUE TO TALK ABOUT DIFFERENT WAYS TO IMPROVE TO ENSURE THAT WE ARE AS EFFICIENT AND HAVE THE STRONGEST CULTURE POSSIBLE TO MOVE THE WORK FORWARD.

THANK YOU. OK, THANK YOU, EVERYONE, I THINK WE'RE READY TO MOVE ON TO THE NEXT TOPIC, SO DISCUSSION OF ADDING OPEN FINDINGS REPORT AND I

[DISCUSSION OF ADDING OPEN FINDINGS REPORT]

HAD BROUGHT THIS UP.

UM. TO CHIEF BLACKWELL, BECAUSE I REALIZED THERE'S A LITTLE BIT OF A MECHANISM IN THE DASHBOARD RIGHT FOR FOLKS TO UPLOAD EVIDENCE, BUT WE DON'T HAVE A WAY AND MAYBE THIS IS ADDRESSED WITH THE DASHBOARD INSTEAD OF JUST A SEPARATE REPORT, BUT WANTED TO HAVE A CONVERSATION WITH COLLEAGUES ON THE COMMITTEE OF WHAT THAT COULD LOOK LIKE IN TERMS OF US HAVING A BETTER SENSE OF THE FINDINGS ARE FOUND.

WHAT THEN HAPPENS, RIGHT? AND IF THERE'S A RANKING SYSTEM, THEN THAT HELPS US BETTER IDENTIFY.

BUT IT'S HARD FOR US TO SIFT THROUGH EVERY REPORT AND IN AND JUST ON THE OUTSET, KNOWING WHAT IS HIGHER RISK AND NOT SO TRUSTEE.

ONE THING THAT WE COULD DO IS HAVE SOME SORT OF TRACKING TOOL FOR THOSE ITEMS THAT GO INTO THE DASHBOARD.

SO, FOR EXAMPLE, WE GIVE THEM 10 BUSINESS DAYS TO UPDATE, UPLOAD SOMETHING INTO THE DASHBOARD. WE CAN TRACK THAT AND REPORT BACK TO YOU ON A REGULAR BASIS.

AND WE WANT IT TO BE SOMETHING THAT WE'RE NOT CREATING LIKE CRAZY AMOUNTS OF WORK, BUT, YOU KNOW, SYSTEMS THAT ALREADY EXIST, BUT, YOU KNOW, JUST ALSO WANT TO HEAR FROM MY COLLEAGUES ON THIS TOO. THANK YOU.

ALL RIGHT. MS. SLOGAN. YOU KNOW, I THINK YOU'VE GOT A GOOD REPOSITORY THERE ON SHAREPOINT.

IT MAY JUST BE LOOKING AT, CAN YOU PUT SOMETHING ON TOP OF THAT LIKE POWER BI AND RUN IT

[01:10:03]

TO CREATE TO CREATE A DASHBOARD? I'M NOT SAYING YOU GOT TO COMPLETELY LIKE, BLOW OUT WHAT YOU'VE GOT.

I THINK YOU'VE GOT A GOOD REPOSITORY, BUT I THINK THAT'S WHAT IT IS.

IT'S A REPOSITORY AT THIS POINT.

RIGHT? SO, SCOTT, MAYBE YOU AND I CAN GET TOGETHER AND TALK ABOUT THIS ONE.

OK. AWESOME.

TRUSTEE SUNG? IS THERE A KEY PERFORMANCE INDICATOR OR A KEY METRIC IN THAT DASHBOARD THAT YOU OR ADMINISTRATION CAN IDENTIFY? THAT GIVES YOU A QUICK INDICATION OF HOW ON TRACK WE ARE? WITH FOLLOW UP. WE HAVE NOT CREATED A KPI PER SAY THAT WE COULD DO THAT.

YEAH. JUST WONDERING IF THERE'S ANYTHING THAT ANYBODY CURRENTLY LOOKS AT? NO. OK. I DON'T THINK WE'RE LOOKING AT ANYTHING PER SAY, ARE WE? ALSO, PULL UP MICROPHONE.

THANK YOU, TRUSTEE, FOR THE QUESTIONS.

SO IN TERMS OF THE FOLLOW UP, WE WE HAVE A ITEM BY ITEM FOLLOW UP.

IF THIS IS NOT WHAT YOU'RE LOOKING FOR, YOU'RE LOOKING FOR LIKE SUMMARIES OF THE FOLLOW UP WE CAN DEVELOP FOR THE WAR AND THE TRUSTEES.

OK, IF YOU'RE LOOKING FOR.

THANK YOU. YOU KNOW, I THINK WE MIGHT LOOK AT FORT BEND ISD SO THAT I THINK IT WAS TRUSTEE FLYNN VILASECA AND THAT ATTENDED A PRESENTATION BY FORT BEND ISD, WHICH IS WHERE WE FIRST SAW A SCHOOL DISTRICT USING A DASHBOARD SYSTEM.

AND THEY DID HAVE, YOU KNOW, LIKE A DASHBOARD THAT YOU COULD AT A GLANCE TELL, YOU KNOW, THESE ARE THE AUDITS THAT HAVE BEEN COMPLETED.

HERE ARE THE RECOMMENDATIONS, AND HERE'S THE PROGRESS THAT'S BEING MADE.

SO TRUSTEE SUNG, THEY WERE USING A COMMERCIAL TOOL.

OK. OFF THE SHELF.

OR I THINK IT WAS ACTUALLY DEVELOPED BY THEM FROM A CONTRACTOR SPECIFICALLY TO FIT THEIR NEEDS. WHEREAS WE WORKING WITH CHIEF GILHAUSEN CREATED A DASHBOARD INTERNALLY.

CORRECT. AND AS OUR DASHBOARD IS VERY DIFFERENT FROM THAT COMMERCIAL TOOL.

YES. AND I RECOGNIZE THAT IT'S DIFFERENT.

BUT I THINK THE SAME INFORMATION IS PRESENT.

AND SO IF WE JUST DRILL DOWN TO AND I IT'S BEEN A FEW YEARS SINCE THE PRESENTATION, BUT IF WE JUST DRILL DOWN TO I THINK IT WAS JUST A SIMPLE RATIO OF HERE ARE THE RECOMMENDATIONS. AND THEN HERE'S THE PERCENTAGE THAT HAVE BEEN, YOU KNOW, COMPLETED.

SO I THINK JUST THAT KEY PERFORMANCE INDICATOR OF WHAT HAS BEEN COMPLETED OVER A CERTAIN PERIOD OF TIME, IF WE CAN JUST FIGURE OUT WHAT WAS THAT KEY THING THAT WAS BEING PRESENTED, THEN WE PRESENT IT BECAUSE I THINK WE HAVE THE SAME INFORMATION IN OUR DASHBOARD. IT'S JUST NOT TRUSTEE FOR US TO FIND.

WHAT IT SOUNDS LIKE IS THAT.

I THINK THE COMMITTEE IS LOOKING FOR MORE OF A SNAPSHOT VERSUS THE DEEP DIVE THAT THE CURRENT CURRENT SYSTEM OFFERS, SIMILAR TO WHAT OUR COVID 19.

YES, YES, LOOKS LIKE.

SO WE'LL WE'LL KIND OF TAKE THAT INFORMATION, WORK WITH BOTH CHIEF CO-HOUSING AS WELL AS MR. BLACKWELL, AND WE'LL FIGURE OUT KIND OF A MORE SIMPLISTIC WAY.

JUST LISTENING TO YOU ALL, I'M GATHERING KIND OF WHAT WHAT THE NEED IS AND WHAT THE ONE IS. OKAY, VERY GOOD.

THANK YOU. AND CHIEF BLACKWELL MAY BE ALSO LOOKING AT TEAMMATE, THE NEW SOFTWARE THAT YOU'RE MOVING TOWARDS, MAYBE THAT MECHANISM EXISTS WITHIN THAT AS WELL, THAT I THINK THAT'S SOMETHING, YOU KNOW, WITH CHIEF GILHAUSEN AND SUPERINTENDENT HOUSE HAVING A CONVERSATION.

OK, WONDERFUL.

LOOKING FORWARD TO MORE ON THAT.

ALL RIGHT, THE NEXT THING ON THE AGENDA IS ETHICS AND COMPLIANCE UPDATE.

[ETHICS AND COMPLIANCE UPDATE]

OH, OKAY, THANKS.

HELLO AGAIN. OKAY, SO OUR FIRST SLIDE IS REGARDING THE ETHICS HOTLINE CASES, AND THIS SHOWS BY MONTH HOW MANY CASES WE RECEIVED AND HOW MANY WE CLOSED.

THAT MONTH, SO AS YOU CAN SEE, OCTOBER, IT'S USUALLY MUCH HIGHER AFTER SCHOOL STARTS AFTER A FEW MONTHS.

THEN WE HAVE A SLIDE SHOWING ALL OF OUR OPEN CASES.

SO AT THIS SNAPSHOT, WE HAD NINETY TWO AND IT'S PERCENTAGE THAT WHO IT WAS ASSIGNED TO WHICH DEPARTMENT. AND THE LAST SLIDE IS THE LIST OF CURRENT PROJECTS

[01:15:07]

WE'RE CURRENTLY FOCUSING ON.

YOU'LL SEE THIS WEEK WE'RE PRESENTING CIA LOCAL, THERE'S A FEW CHANGES THERE.

WE'RE UPDATING THAT POLICY.

WE'RE WORKING ON THE DEPARTMENT PROCEDURES GUIDE, WHICH WAS ONE OF OUR AUDIT FINDINGS.

WE'RE REVISING THE PROCESS TO ENSURE VENDORS WITH DIRECT CONTACT WITH STUDENTS RECEIVE BACKGROUND CHECKS PRIOR TO STARTING WORK AT AT HISD, AND SO THAT HISD CAN LEGALLY REVIEW THE REVIEW. THE RESULTS BECAUSE DPS HAS RECENTLY CHANGED THE REQUIREMENTS ON WHO CAN ACCESS FINGERPRINTING, AND LIKE I MENTIONED EARLIER, WE'RE INTERVIEWING CANDIDATES FOR THE ANALYST POSITION.

ANY QUESTIONS? WHAT ARE THE CHANGES, THE DPS REQUIREMENT CHANGES? UM, WELL, BECAUSE OF AN FBI AUDIT, WHICH ACTUALLY HAPPENED A FEW YEARS AGO, THEY'RE JUST NOW PUTTING THIS INTO PLACE.

CERTAIN SCHOOLS AND VENDORS CANNOT ACCESS CERTAIN VENDORS' FINGERPRINTING RESULTS AND VENDORS CANNOT ACCESS THEIR OWN FINGERPRINTING RESULTS UNLESS THEY MEET THE CERTAIN REQUIREMENT, LIKE CHILD CARE CENTERS WOULD MEET THE REQUIREMENT. SO THEREFORE, WE'RE HAVING TO INCLUDE PERFORM MORE FINGERPRINTING HERE OR GET THE RESULTS HERE AND ACCESS IT.

SO I'VE BEEN WORKING WITH PROCUREMENT AND LEGAL AND PROFESSIONAL STANDARDS TO PUT THAT PROCESS IN PLACE, SO THERE'S NO GAPS.

YEP, JUST A FOLLOW UP TO THAT, WHAT'S THE TIMELINE TO ENSURING THAT THAT THE PROCESS IS BEING IMPLEMENTED BASED ON THE REQUIREMENTS FROM DPS? I KNOW WELL, WE HAVE ALREADY STARTED THAT PROCESS.

WE ARE WORKING WITH EXTERNAL COUNSEL WHO WORKS CLOSELY WITH THE PURCHASING SERVICES.

AND IT'S JUST A MATTER OF GETTING ALL THE FORMS RIGHT AND SENDING ADDENDUMS TO CERTAIN VENDORS THAT HAVE ALREADY GONE OUT.

WITH DIFFERENT TERMINOLOGY, BUT THERE WAS A SHORT TIME WHERE WE WERE DOING, WE WERE HAVING VENDORS SELF CERTIFY THAT THEY HAD BACKGROUND CHECKS PERFORMED AND THEY CLEARED.

AND NOW WE'RE HAVING TO GO BACK TO THE PREVIOUS PROCESS, WHICH IS WHERE MOST OF OUR VENDORS, USED THE HISD CODE AND THEN WE GET THE RESULTS.

AND SO THEN WE HAVE TO CLEAR THEM.

BUT THERE'S A LOT TO BE CONSIDERED WITH THAT PROCESS.

SO WE'RE CONSTANTLY WORKING ON IT NOW.

THANK YOU. ON BACK ON SLIDE 79, THE ETHICS HOTLINE CASES THE EACH MONTH EACH OF THE CASES RECEIVED THAT MONTH, IS THAT CORRECT? AND THEN THE CLOSURES TO DATE IS A SUBSET OF OF THOSE? NO, IT'S JUST IT COULD HAVE BEEN A CASE FROM ANOTHER MONTH.

OK, SO THESE ARE THE CLOSURES THAT ARE HAPPENING EACH MONTH.

CORRECT. SO THEN DOES THAT MEAN WE'RE BUILDING A BACKLOG SINCE WE'RE GETTING MORE CASES THAN ARE CLOSING EACH MONTH? UM YES, IT DOES APPEAR THAT WAY, AND IT'S JUST HARD TO DETERMINE, YOU KNOW, THE EXTENT OF EACH CASE. IT'S ON A CASE BY CASE BASIS.

AND A LOT OF THEM ARE OUTSIDE OF OUR DEPARTMENT.

AND SO WE FOLLOW UP AND WE TRY TO GET THEM CLOSED AS QUICK AS POSSIBLE.

BUT EVERY CASE IS DIFFERENT.

SURE. SO SHOULD WE EXPECT TO SEE IN THE FUTURE LIKE A REVERSAL OF THIS, WHERE WE EVENTUALLY GET TO A PLACE WHERE MORE CASES ARE BEING CLOSED THAN ARE BEING RECEIVED? SO WE'RE WE'RE WATERING DOWN THAT BACKLOG? YEAH, I THINK BASED ON WHAT WE SAW LAST YEAR, DURING THE SUMMER MONTHS, WE HAD LESS CASES, WE HAD MORE TIME TO CLOSE CASES AND THEN WE SEEM TO GET CAUGHT UP.

OK, SO THIS ISN'T SOMETHING THAT YOU'RE WORRIED ABOUT AT THIS POINT? NO. OK, THANK YOU.

ANYTHING ELSE? I HAVE ANOTHER QUESTION.

IS THERE? IS THERE ANY WAY FOR US TO BE ALERTED OR DO YOU THINK IT'S IMPORTANT IF THERE'S SOMETHING THAT COMES IN THROUGH THE ETHICS HOTLINE THAT YOU FEEL WARRANTS THE COMMITTEE TO BE? YOU KNOW, THIS, YOU KNOW, SOMETHING OF CONCERN? UM, YES, I HAVE THOUGHT ABOUT THAT, AND IF THERE WAS THAT SITUATION, I WOULD DISCUSS IT,

[01:20:02]

OF COURSE, WITH CHIEF BLACKWELL AND SUPERINTENDENT HOUSE AND MAKE THAT DETERMINATION.

SO I'M SURE IT'S ALSO IMPORTANT TO NOTE THAT IF WE HAVE SOMETHING THAT RISES TO THAT LEVEL, WE DISCUSS IT WITH YOU ALL IN CLOSED SESSION.

SO FOR EXAMPLE, WE HAVE AN AGENDA FOR YOU IN TODAY'S CLOSED SESSION THAT ADDRESSES THE KIND OF THINGS YOU JUST MENTIONED.

SO JUST A FOLLOW UP TO TRUSTEE SUNG'S LINE OF QUESTIONING, WOULD IT BE POSSIBLE TO GET A. A BAR GRAPH WITH THE NUMBER OF CASES THAT ARE STILL OPEN.

THIS IS A NUMBER OF CASES RECEIVED, SO WE DON'T HAVE A MONTHLY HOW MANY CASES? YEAH, I'LL OPEN. THIS SLIDE DOES SHOW THE TOTAL.

OH, THE TOTAL I SEE IS AT THE TOP.

OK. YEAH.

WOULD WE BE ABLE TO GET THAT BY MONTH? AS WELL, JUST TO SEE LIKE WHERE THE TREND IS GOING.

SURE. THANK YOU.

UH-HUH.

UM, WE DO HAVE A LITTLE BIT OF TIME, SO.

CHIEF BLACKWELL, IF THERE'S SOMETHING YOU WANTED TO ELEVATE PRETTY QUICKLY ABOUT THIS? OR IF MY COLLEAGUES HAVE ANY QUESTIONS? SO WE HAVE CREATED PROFESSIONAL DEVELOPMENT PLAN IS SOMETHING THAT I STARTED IN 2018 AFTER HAVING A YEAR WITH MY TEAM AND GETTING TO KNOW THEM AND THEIR ABILITIES.

AND I FELT THAT THERE WAS A NEED TO INCREASE OUR PROFESSIONALISM.

SO I STARTED A PROFESSIONAL DEVELOPMENT PLAN IN TWENTY EIGHTEEN.

AND WE'VE FOUND THAT THAT HAS BEEN VERY HELPFUL TO INCREASE OUR ABILITIES, OUR SKILLS.

SO WE'RE CONTINUING THAT IN TWENTY TWENTY ONE TWENTY TWENTY TWO.

AND THESE ARE THE KIND OF TOPICS OR AREAS THAT WE FEEL THAT ARE IMPORTANT FOR US TO DEVELOP OURSELVES EVEN MORE THAN WHAT WE ALREADY HAVE.

OK, THANK YOU FOR THAT AND THANK YOU FOR.

FOR CONTINUING TO MAKE THAT A PRIORITY FOR THE DEPARTMENT.

NEXT ON THE AGENDA IS AUDIT DEPARTMENT STRUCTURE CHIEF BLACKWELL PROVIDED THE LATEST ORGANIZATIONAL CHART AND TRUSTEE SUNG.

I'LL TURN THE TIME OVER TO YOU.

I KNOW THIS WAS SOMETHING THAT WAS ON YOUR MIND.

YES. THANK YOU, MADAM CHAIR.

SO, CHIEF BLACKWELL, I KNOW YOU'VE WORKED VERY HARD OVER THE LAST ALMOST FIVE YEARS THAT YOU'VE BEEN HERE WITH HISD TO PROVIDE TRAINING.

THANK YOU FOR THAT PRIOR SLIDE ON THE PROFESSIONAL DEVELOPMENT.

I KNOW THAT'S BEEN A PRIORITY OF YOURS TO FILL VACANT POSITIONS TO MAKE SURE WE HAVE THE BEST QUALIFIED PEOPLE TO DO THE WORK OF INTERNAL AUDIT HERE.

I WANT TO SAY THAT FROM MY PERSPECTIVE, THE MOST IMPORTANT THING FOR INTERNAL AUDIT IS THAT WE GET THE WORK DONE ON BEHALF OF THE DISTRICT, AND I'M ACTUALLY AGNOSTIC AS TO HOW WE DO THAT, WHETHER THAT'S THROUGH INTERNAL POSITIONS OR THROUGH EXTERNAL OUTSOURCING.

SO I KNOW THERE'S BEEN SOME SOME QUESTIONS AND WE'VE HAD SOME DISCUSSION AS TO HOW MUCH ARE WE DOING INTERNALLY, HOW MUCH ARE WE OUTSOURCING? AND I JUST WANT YOU TO KNOW THAT FROM MY PERSPECTIVE, AT LEAST, I'M OK WITH US DOING IT EITHER WAY. SO I KNOW YOU INHERITED A DEPARTMENT WHEN YOU CAME HERE AND YOU'VE DONE ALL THIS WORK TO BUILD IT UP.

BUT IF YOU COULD WITHOUT CONSTRAINT NOW THAT YOU'VE BEEN HERE SEVERAL YEARS NOW, THAT YOU KNOW THE CHALLENGES OF HIRING, YOU KNOW, OUR PAY STRUCTURE HERE IN HISD, IF YOU COULD DO THE JOB OF COMPLETING THE ANNUAL AUDIT PLAN AS EFFICIENTLY AS POSSIBLE WITHOUT CONSTRAINT WITH REGARD TO WHETHER YOU'RE OUTSOURCING OR DOING IT IN-HOUSE.

IF YOU COULD ADJUST PAY SCALE, RIGHT, WHAT ARE THE WHAT CONSTRAINTS? HOW WOULD YOU ORGANIZE YOUR WORK IN AN IDEAL WORLD, IF YOU COULD ADJUST SOME OF THE CONSTRAINTS THAT THAT WERE IMPOSED WHEN YOU FIRST CAME HERE? TRUSTEE SUNG? IF YOU DON'T MIND, I THINK JUST FROM A CULTURE AND A STAFFING STANDPOINT, THAT MIGHT BE

[01:25:07]

SOMETHING THAT'S BETTER FIT FOR CLOSED SESSION BECAUSE THERE IS A WORKING GROUP THAT WE'RE BUILDING A CULTURE WITH.

YES. I DON'T WANT ANY TYPE OF ANSWER TO LEAD TOWARDS ASSUMPTIONS.

YES, AROUND WHAT MAY HAPPEN WITH JOBS OR ANYTHING LIKE THAT.

MY UNDERSTANDING IS LEGALLY, WE CAN DISCUSS INDIVIDUAL POSITIONS IN CLOSED SESSION.

I DON'T THINK WE CAN DISCUSS THE QUESTION.

I JUST ASKED IN CLOSED SESSION.

LET ME ASK LISA. LOOK AT THE PLAYERS ON INDIVIDUAL PERFORMANCE IN RESPONSE TO YOUR QUESTION, BEARS ON INDIVIDUAL PERFORMANCE AND THAT COULD BE DISCUSSED.

SO I WANT TO I WANT TO FLAG THAT.

YEAH, IT'S IMPORTANT TO ME IN RESPONSE TO SUPERINTENDENT HOUSES, QUESTION THAT ANY RESPONSE THAT BEARS ON INDIVIDUALS BE DISCUSSED IN CLOSED SESSION.

SO I'LL POSE THAT QUESTION.

AND THEN SHOULD WE GO INTO CLOSED SESSION, THEN? UM, YES, I THINK YOU ALREADY HAVE A CLOSED SESSION PLANNED, SO I DON'T KNOW IF YOU WANT TO WAIT AND FLAG IT FOR? OK, WE'LL FLAG THAT FOR DISCUSSION IN CLOSED SESSION AND THEN TO THE EXTENT THAT WE NEED TO DISCUSS SOMETHING THAT CANNOT BE DISCUSSED IN CLOSED SESSION, I WANT TO MAKE SURE WE'RE FOLLOWING OPEN MEETINGS ACT AND THAT WE HAVE WHAT NEEDS TO BE DISCUSSED IN OPEN SESSION DISCUSS IN OPEN SESSION.

THANK YOU. SO IF I COULD SAY ONE THING IN RESPONSE TRUSTEE SUNG WE ARE GRADUALLY DECLINING OUR DEPENDENCE ON FIRMS, AND EVEN FOR THE NEXT AUDIT PLAN, I GAVE INSTRUCTIONS TO ALL OF MY MANAGERS WITH THAT MESSAGE.

AND SO I TOLD THEM THAT I DON'T WANT MORE THAN TWO AUDITS IN THEIR AUDIT PLAN DONE BY A FIRM. BECAUSE WE SHOULD BE ABLE TO GET THESE AUDITS DONE OURSELVES ANYWAY.

BUT WE ARE GRADUALLY IMPROVING OURSELVES, AND WE'RE MUCH BETTER NOW THAN WHEN WE WERE FOUR YEARS AGO. FAR BETTER NOW THAT STILL WE HAD THAT RELIANCE AND THAT RELIANCE IS ON THE MOST IMPORTANT AUDITS THAT WE HAVE.

FOR EXAMPLE, THE OTHER AUDITS THAT YOU SAW ON THE LIST EARLIER, THAT ONE, I'M OUTSOURCING . IT'S JUST A CRITICALLY IMPORTANT ONE TO THE DISTRICT.

AND WHILE WE DO HAVE A TEAM, THEY ARE SAYING OTHER AUDITS IN THEIR AUDIT PLAN.

SO THE RELIANCE IS DECREASING AND WE WANT TO GET TO A POINT WHERE THERE'S ALMOST ZERO RELIANCE. OK.

SO FOR NEXT YEAR, WHAT I TOLD THE TEAM, NO MORE THAN TWO OUTSOURCED AUDITS.

[INAUDIBLE].

WHAT'S THE REASON FOR WANTING TO NOT RELY ON OUTSOURCED AUDITS? WHY IS THAT IMPORTANT? FRANKLY, WE SHOULD BE ABLE TO DO IT OURSELVES.

OK. MS. LOGAN? YEAH. YOU KNOW, JUST ONE THING TO THINK ABOUT.

I THINK IT'S GREAT THAT YOU DO AS MUCH OF THE WORK AS YOU CAN IN HOUSE.

I THINK THERE'S ALWAYS GOING TO BE CAPABILITIES AND SKILLS THAT YOU MAY NOT NEED YEAR ROUND SUBJECT MATTER EXPERTISE.

I SEE THAT A LOT IN IT IN CYBER.

AND THEN IN SOME OF THE OTHER, YOU KNOW, TECHNICAL AUDIT AREAS.

SO I WOULD ENCOURAGE YOU TO TO NOT HAVE YOUR GOAL BE ZERO PERCENT, BUT REALLY AROUND THOSE AREAS WHERE YOU REALLY NEED THAT SUBJECT MATTER EXPERTISE TO COME IN AND SUPPLEMENT WHAT YOU'VE GOT. SO THAT WOULD BE MY ONLY COMMENT OR AROUND THE GOAL TO DECREASE, MAYBE NOT TO ZERO, JUST BECAUSE YOU MAY NEED, YOU KNOW, YOU MAY NEED TO HAVE A CYBER AUDIT DONE AND YOU MAY NOT HAVE THAT SKILL IN HOUSE.

ALL RIGHT. SO WE DO HAVE OUR INFORMATION BECAUSE WE DO NOT HAVE A STAFF OF IT AUDITORS.

AND EVEN IF WE DID HAVE A STAFF, IT AUDITORS, THERE ARE CERTAIN NEEDS THAT IT AUDITORS MUST HAVE FULFILLED.

YEAH, THAT HAS BUDGET IMPLICATIONS.

YEAH, ABSOLUTELY.

ABSOLUTELY. SO I JUST WANTED TO ALSO LET THE THE TRUSTEES KNEW THAT THAT THERE ARE CERTAIN TIMES WHEN YOU REALLY HAVE TO HAVE OUTSIDE OUTSIDE EXPERTISE JUST TO GET SOME OF THAT SUBJECT MATTER EXPERTISE.

AND I THINK THIS WAS BROUGHT UP NOT AS MUCH AS THAT WE DON'T WANT THIRD PARTY AUDITORS, I THINK IT'S JUST HOW DOES THAT LOOK IN THE FUTURE? I THINK ANOTHER BENEFIT OF USING THIRD PARTY AUDITORS IS THAT THEY ARE ALSO WORKING IN OTHER DISTRICTS AND SEEING THOSE INNER WORKINGS, RIGHT, AND I THINK THAT IS ALSO, YOU KNOW, TO MS. LOGAN'S POINT AS WELL, FIRMS THAT ARE SELECTED TO HAVE A STATEWIDE, IF NOT BEYOND STATE

[01:30:01]

YES, OUGHT TO PRACTICE AND PARTICULARLY IN THE EDUCATION AREA.

ABSOLUTELY. AND BEFORE WE GO INTO CLOSED SESSION, I KNOW MS. LOGAN HAS BEEN WITH US BEFORE, BUT I DON'T KNOW THAT EVERYONE IN THE ROOM KNOWS HER.

SO IF YOU JUST WANT TO INTRODUCE YOURSELF? YEAH, ABSOLUTELY. IT'S ACTUALLY MY I THINK I'VE BEEN ON VIDEO EVERY MEETING, SO IT'S NICE TO BE HERE IN PERSON AND SEE EVERYBODY.

MY NAME'S LIZ LOGAN. I'M A PARTNER IN THE INTERNAL AUDIT PRACTICE AT ERNST AND YOUNG.

THEN WITH THE FIRM FOR 18 YEARS SITTING IN HOUSTON.

THE WHOLE TIME I HAVE PUBLIC CLIENTS.

I HAVE PRIVATE CLIENTS AND I'M JUST DELIGHTED TO BE ABLE TO TO BE A VOLUNTEER HERE.

I ALWAYS I LOVE EDUCATION.

I'M SUPPORTIVE OF EDUCATION AND I ALWAYS STRUGGLED WITH HOW DO I USE MY SKILLS TO VOLUNTEER? SO THIS IS PERFECT AND I'M JUST SO HAPPY TO BE HERE.

AND, YOU KNOW, JUST LET ME KNOW HOWEVER, I CAN HELP.

SO AT THIS TIME, THE COMMITTEE WILL ADJOURN INTO CLOSED SESSION IN THE BOARD SERVICES

[CLOSED SESSION (CLOSED TO THE PUBLIC)]

CONFERENCE ROOM UNDER CHAPTER 551 OF TEXAS GOVERNMENT CODE OPEN MEETINGS ACT SUBSECTIONS 551.004,.071,.072,.073, .074,.076,.082,.0821,.083,.084, .089 , SHOULD BOARD FINAL ACTION VOTER DECISION ON ANY MATTER CONSIDERED IN THE CLOSED SESSION BE REQUIRED. SUCH FINAL ACTION, VOTE OR DECISION SHALL BE TAKEN AT THE OPEN MEETING COVERED BY THIS NOTICE UPON THE RECONVENING OF THIS PUBLIC MEETING OR AT A SUBSEQUENT PUBLIC MEETING OF THE BOARD UPON NOTICE THEREOF.

THE COMMITTEE BOARD HAS ADJOURNED TO CLOSED SESSION AT 10:32 AM.

* This transcript was compiled from uncorrected Closed Captioning.