Metro Internal Audit – Collier and MNPS reports

The Metro Audit Committee meets next on February 12. We will consider the Metro Auditor’s reports about Collier Engineering and various allegations related to MNPS. Both are getting media attention and I think it is appropriate for me to comment transparently.

In connection with two investigation reports in 2018, I said in Audit Committee meetings that I think the internal audit department findings were inadequate. To put a finer point on it — I think the internal audit reports on investigations recently have pulled punches and sought to move on rather than fully address the allegations.

If you want to read more info about my thoughts about the internal audit function generally, read this.

In connection with Collier, I think the supplemental report we will consider this week is inadequate. Regarding the MNPS investigation report, I don’t have an opinion yet. (It’s voluminous, it came out just a few days ago, and I just haven’t gotten through it yet.)

On Collier…here is the basic internal audit timeline…

The Auditor’s initial report was issued on October 26, 2018. That version doesn’t seem to be online any longer. The Audit Committee discussed this report at our November 27, 2018 meeting. I thought the report was inadequate and I made six motions asking for the report to be supplemented and updated. You can see the motions on pages 9 and 10 of this package. The motions passed unanimously and that sent the Auditor back to work further. For context, in 3+ years on the Audit Committee, this was the first time we ever did anything like this.

The Auditor’s supplemental report is dated January 24, 2019 (although it wasn’t posted online until January 30, after I asked about getting it online).

I consider the supplemental report to still be inadequate. My email to the Auditor dated January 30, 2019, explains my reasoning. The summary is that I think the supplemental report is holding back and downplaying the seriousness of the evidence. I’ll continue to ask these questions at the Audit Committee meeting on Tuesday.

And MNPS…

The Auditor releases a 69 page report about various allegations related to MNPS a few days ago on February 6, 2019. As I mentioned above, I haven’t had the time to dig in on this the same way that I have done with the Collier reports.

I know two things at this point.

First, I currently do not have full faith in the willingness of Metro’s internal audit function to shine the right amount of light on alleged bad acts.

Second, I know there are people asking good faith questions about issues related to MNPS. As just one example, I saw that yesterday Phil Williams put out a 74 tweet opus about these allegations and the audit report. I’ve only skimmed his tweets, but it looks like he’s asking some of the same questions that I have about the willingness of the internal audit function to shine a bright line on controversial topics.

I have got a full schedule between now and the Audit Committee meeting at 4pm on Tuesday. I’ll try to get through this report by then. If I don’t, I’ll ask the Audit Committee to push off considering this report until our next meeting. I am not sure we can expect any of the committee members to meaningfully get through this important report in just 3 or 4 business days.

Bob Mendes

Bob Mendes represents all of Nashville as a Council-At-Large member of Nashville’s Metro Council. He is Chair of the Council’s Charter Revision Committee, a member of the Metropolitan Audit Committee, and a member of the Council’s Budget & Finance Committee, Rules & Confirmations Committee, and Ad Hoc Affordable Housing Committee. Bob also practices business law at Waypoint Law PLLC. Bob’s complete bio is here. You can follow Bob @mendesbob.