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BWL internal audit director describes independent audit authority, cites $3.2 million returned to customers
Summary
Alicia Franco, Internal Audit Director for the Lansing Board of Water and Light, briefed the charter commission on the audit function’s independence, mandate and a recent audit that led to $3,200,000 being returned to customers.
Alicia Franco, internal audit director for the Lansing Board of Water and Light, gave the Lansing Charter Commission a high‑level briefing on March 4 about the internal audit department’s authority, independence and work‑planning process.
Franco told commissioners that the internal audit function reports directly to the BWL board of commissioners—specifically the finance committee—and “does not report to management in any capacity,” a structure she said preserves objectivity. The audit charter, she said, grants auditors unrestricted access to records and the authority to review processes and management itself.
Franco cited a fiscal year 2024 audit of BWL’s rules and regulations that examined the utility’s security deposit process. The audit recommended revising the security deposit release guidelines so customers would receive credit for a deposit only if they had no shutoffs within a 12‑month rolling period. Franco said management agreed to implement the recommendation and that the change contributed to returning $3,200,000 to customers.
She outlined the audit planning process: an annual risk assessment that informs an audit “universe” and an audit work plan the board may amend if it requests particular reviews. Franco said the board’s finance committee may request items be added to the work plan.
Franco also described the internal audit charter as the department’s governing document, noting it defines mission, scope, adherence to global internal audit standards, independence and oversight by the board of commissioners.
Why it matters: Commissioners are revising the charter and have asked about internal‑audit functions and whether transparency‑type duties could be coordinated between the internal auditor and a proposed transparency officer. Franco’s description of independence and her example audit provide the commission concrete evidence of the audit department’s existing oversight and its ability to affect customer refunds and policy changes.
The commission said it plans to invite the internal auditor back at the April 1 meeting to discuss coordination between the internal audit and a proposed transparency officer.
