An Enterprise Risk Assessment conducted by Albuquerque-based firm Moss Adams designated seven of 18 city categories as high risk. City officials say the results are not a cause for concern.
A recent internal assessment designating seven of 18 city governmental categories as “high risk” is not a cause for concern, officials said Monday.
“Anyone telling you that this is outrageous and this is horrible is looking for you to write a pants-on-fire story, which isn’t really true but gets people in the news,” said City Manager John Blair.
The city’s Audit Committee, a five-person civilian panel which meets quarterly, received a presentation at its June 28 meeting about an Enterprise Risk Assessment conducted this year as part of an internal city audit.
The risk assessment is conducted every three years as part of a regular process of ongoing internal audits, which are separate from the external financial audits the city must submit to the state on an annual basis.
While the external financial audit is relatively narrow in scope, looking at things such as the city’s internal financial controls and compliance with federal grant reporting requirements, internal audits looks at how the city operates as a whole. The city entered into a four-year contract with the Albuquerque office of accounting firm Moss Adams in November for $698,133 to conduct the city’s internal audits, including the risk assessment.
The assessment was conducted between January and April of this year and focused on identifying and evaluating risks to the city’s operations.
“The goal, really, is ... to continue to make improvements about how we can do a better job of serving the residents who live here,” Blair said of what the assessment is meant to achieve.
Moss Adams evaluated 18 categories as part of its assessment. Of those, seven were put in the high risk category — including accounting and finance; human resources; planning and safety; and procurement and contracting. Five were placed in the ‘moderate to high’ category and six in the ‘moderate’ category.
According to a June 4 report compiled by Moss Adams for the city, the high-risk category “represents significant risks that should be addressed immediately.”
An Enterprise Risk Assessment conducted by Albuquerque-based firm Moss Adams designated seven of 18 city categories as high risk. City officials say the results are not a cause for concern.
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Blair said the high-risk category is not a sign that something is wrong. Rather, he said, “This is just what gets used to help us identify what are the areas to focus on most if we want to make the biggest change in the most efficient, fastest way,” he said.
Audit Committee Chairman Randy Grissom said he was unsurprised by areas flagged as high risk because they would have the biggest impact on the city if something were to go wrong.
“When they presented their findings they basically didn’t present that they had found anything wrong, they had just discovered opportunities and where they would recommend us focusing our efforts,” he said of Moss Adams’ presentation to the city.
The committee will meet again next month, Grissom said, and is eager to make significant progress before work begins in earnest on the city’s next financial audit later this year.
In response to questions from TheNew Mexican about what the assessment means for the city, Finance Director Emily Oster at times read directly from the text of the slides presented to the Audit Committee without elaboration.
“I think a lot of the information you’re looking for is here in the PowerPoint, it may be just in a different format than what you were expecting,” she said.
Blair and Oster also were evasive when repeatedly asked whether the city received a more detailed document from Moss Adams than the nine-page slide deck included in the Audit Committee meeting’s public agenda documents.
“I’m not aware that they’ve presented any sort of a written report to anyone in the city right now saying, ‘Here’s what we think’ or that sort of thing,” Blair said. “Again, this is the beginning of the process.”
However, Moss Adams Senior Manager Chelsea Ritchie said Tuesday the firm had prepared a full report for the city.
“We provided them a report, a full-blown report, and then it was also a presentation to the Audit Committee,” Ritchie said.
Asked how to request a copy of the report, she said Blair or Deputy Manager Layla Archuletta-Maestas were the appropriate people to contact.
In response to an email Tuesday, Archuletta-Maestas provided a copy of the report. The report was provided to city councilors around the same time.
In a subsequent email, Blair insisted he had not been aware of the report until Tuesday.
Councilor Michael Garcia said he had reached out to Archuletta-Maestas more than a week ago to ask for a copy of the report and for the City Council to receive the same presentation as the Audit Committee.
In a Tuesday email, Blair wrote the administration was still working through the appropriate process regarding committee or governing body presentations.
Now that councilors have the report, Garcia said it’s their responsibility to try and help lower the city’s risk levels, but acknowledged he was frustrated by the administration’s behavior.
“I still don’t understand why this administration claims to be transparent but its actions display the complete opposite,” Garcia said.
