Chapter 3.60
INTERNAL CONTROL SYSTEM AND POLICY
Sections:
3.60.060 Review of current policy.
3.60.080 Oversight body/policy.
3.60.090 Implementation/violation.
3.60.100 Implementation/methods.
3.60.010 Mission.
(A) The town of Highland through its town council finds that its mission as related to an internal control system is as follows:
(1) Provision of a democratic governmental structure at the grassroots level;
(2) Provision of services as determined through the governmental process including but not limited to administration, economic development and planning, public safety, utilities (water and sewer), and parks and recreation;
(3) Promotion of government efficiency, accountability, reliability and transparency; and
(4) Promotion of safeguards to reduce the risk of loss due to fraud, waste, abuse, mismanagement or errors. [Ord. 1640 § 1, 2016].
3.60.020 Objectives.
(A) The town of Highland through its town council finds that its interrelated and often overlapping objectives as related to an internal control system are as follows:
(1) Operations Objectives. These objectives involve the ways governmental services are performed and the performance of those providing governmental services including by way of example budgeting, purchasing, permitting, cash management, and planning among others.
(2) Reporting Objectives. These objectives involve the filing of financial and nonfinancial information to those inside the government and those outside of the government including by way of example filing the annual report, audit and examination cooperation, filing uniform conflict of interest forms, and the other filings with any governmental agency or official or information required to be maintained on file such as an OSHA log and responding to a public records request among others.
(3) Compliance Objectives. These objectives involve the adherence to law and regulations including by way of example following guidance documents such as the State Board of Accounts’ manuals, bulletins, directives and the department of local government finance’s forms and directions and including other outside-of-government trainings and documents. [Ord. 1640 § 1, 2016].
3.60.030 Standards adopted.
(A) The town of Highland through its town council adopts and directs the minimum level of internal control standards and internal control procedures for an internal control system that includes the following five standards to promote government accountability and transparency as described in the Uniform Internal Control Standards for Indiana Political Subdivisions guidance document from the State Board of Accounts dated September 2015, and as thereafter modified:
(1) Control environment.
(2) Risk assessment.
(3) Control activities.
(4) Information and communication.
(5) Monitoring. [Ord. 1640 § 1, 2016].
3.60.040 Principles.
(A) The town of Highland through its town council adopts and directs the following principles in explanation of the pertinent standards set forth in HMC 3.60.030 be followed at all levels of the town of Highland:
(1) Control Environment.
(a) The oversight body and management demonstrate a commitment to integrity and ethical values.
(b) The oversight body oversees the town of Highland through its town council’s internal control system.
(c) Management establishes an organizational structure, assigns responsibility, and delegates authority to achieve the town of Highland through its town council’s objectives.
(d) Management demonstrates a commitment to attract, develop, and retain competent individuals.
(e) Management evaluates performance and holds individuals accountable for their internal control responsibilities.
(2) Risk Assessment.
(a) Management defines objectives clearly to enable the identification of risks and defines risk tolerances.
(b) Management identifies, analyzes and responds to risk related to achieving the defined objectives.
(c) Management considers the potential for fraud when identifying, analyzing and responding to risks.
(d) Management identifies, analyzes, and responds to significant changes that could affect the internal control system.
(3) Control Activities.
(a) Management designs control activities to achieve objectives and respond to risks.
(b) Management designs the town of Highland’s information system and related control activities to achieve objectives and respond to risks.
(c) Management implements control activities through policies.
(4) Information and Communication.
(a) Management uses quality information to achieve the town of Highland’s objectives.
(b) Management internally communicates the necessary quality information to achieve the town of Highland’s objectives.
(c) Management externally communicates the necessary quality information to achieve the town of Highland’s objectives.
(5) Monitoring.
(a) Management establishes and operates monitoring activities to monitor the internal control system and evaluate the results.
(b) Management remediates identified internal control deficiencies on a timely basis. [Ord. 1640 § 1, 2016].
3.60.050 System established.
(A) The town of Highland adopts the internal control standards herein to establish an effective internal control system for the town of Highland through its design, implementation, and operation.
(B) The town of Highland directs that the above standards be used to design, implement, operate and modify current operations, reporting and compliance objectives that will safeguard the assets of the town of Highland; promote reliability, accountability and transparency of financial and nonfinancial information; and to assure compliance with laws and regulations for each office, department, and personnel (as defined in HMC 3.60.070) for an effective and reasonable internal control system of the town of Highland. [Ord. 1640 § 1, 2016].
3.60.060 Review of current policy.
The town of Highland authorizes the office of the clerk-treasurer to review the current internal control system of the town of Highland and draft an internal control policy. The town council shall adopt the policy for the future internal control system to be effective after June 30, 2016, and perform at least an annual review, for compliance with this chapter. [Ord. 1640 § 1, 2016].
3.60.070 Applicability.
(A) The personnel, whether an official or employee, of the town of Highland whose official duties include receiving, processing, depositing, disbursing, or otherwise having access to funds that belong to the federal government, state government, a political subdivision, or another governmental entity shall comply with these minimum internal control standards and procedures and any other policy regarding standards and procedures determined necessary by the town of Highland now and as modified in the future.
(B) The personnel of the town of Highland whose official duties include receiving, processing, depositing, disbursing, or otherwise having access to funds that belong to the federal government, state government, a political subdivision, or another governmental entity shall be trained, unless on leave status, on the minimum internal control standards and procedures and any other standards and procedures determined necessary by the town of Highland and shall cooperate with the clerk-treasurer or designee so that the clerk-treasurer can timely certify to the State Board of Accounts that the training was received by personnel as provided by law.
(C) The town of Highland authorizes the office of the clerk-treasurer and the town council president to determine the position and person who are the personnel referred to in subsections (A) and (B) of this section and notify such personnel. [Ord. 1640 § 1, 2016].
3.60.080 Oversight body/policy.
The town council of the town of Highland will be the oversight body of the internal controls system and policy. The office of the clerk-treasurer will create the internal controls systems policy and such policy once adopted, will be codified as administrative rules and included with other rules of the town in the municipal code. Management constitutes all department heads and the clerk-treasurer. [Ord. 1640 § 1, 2016].
3.60.090 Implementation/violation.
(A) All elected and appointed officials and employees of the town of Highland are hereby directed to abide by and to cooperate fully in the implementation of the internal control system of the town of Highland.
(B) An employee who fails to abide by or cooperate with the implementation, compliance, and certifications connected with the internal control system commits a violation of workplace standards and may result in the discipline, including termination, of the employee.
(C) An elected or appointed official of the town of Highland who fails to abide by or cooperate with the implementation and the mandated certifications of the internal control system may be subject to any action allowed by law. [Ord. 1640 § 1, 2016].
3.60.100 Implementation/methods.
(A) This chapter may be implemented by any or all of the following actions or such others as authorized by the Highland town council:
(1) Posting a copy of the ordinance codified in this chapter in its entirety in at least one of the locations in the town of Highland where it posts employer posters or other notices to its employees;
(2) Providing a copy of the ordinance codified in this chapter to its employees and elected and appointed officials;
(3) Providing or posting a notice of the adoption of the ordinance codified in this chapter; or
(4) Any such other action or actions that would communicate the policies established by this chapter to its employees and elected and appointed officials. [Ord. 1640 § 1, 2016].