Santaquin council approves annual fraud risk assessment, updates signatory

The Santaquin City Council voted to adopt the city's required annual fraud risk assessment and directed staff to correct the signatory on the resolution from Emily to Stephanie.

Finance Director Shannon explained that the assessment is an annual review of internal controls, separation of duties, policies and procedures designed to mitigate or prevent fraud. Shannon described the form as a series of yes/no questions with space for mitigating controls; auditors test the answers during their audit work. "Show me where those policies are," she said, summarizing auditors' requests for documentation.

Council members asked whether the assessment affects insurance premiums. Shannon said the city's insurance company requires a copy and that insurers consider the assessment when setting premiums, though she characterized Santaquin's overall risk as low: "As long as we're at low or very low, I don't know that it's gonna make much of an impact." The auditor, John Hatterley, had earlier said he did not favor converting the form into a scored points exercise but acknowledged audit committees and internal auditors can add value.

Council discussed the practical cost of achieving maximum points on the new scoring scheme and whether hiring staff or forming a committee was prudent; several members said current controls and frequent staff-auditor contact mitigate risk. After discussion, a motion to adopt the fraud risk assessment (with the signatory change to Stephanie) was moved, seconded and approved by voice vote.

The resolution was corrected before signature and will be stored with the updated recorder name, staff said.

Evidence: Shannon's presentation of the assessment, Hatterley's remarks on committees and controls, and the recorded motion and voice vote at the meeting.