County of Durham
AUDIT OVERSIGHT COMMITTEE
Durham, North Carolina

BY-LAWS
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ARTICLE I
NAME

SECTION 1.      The name of this organization shall be “Audit Oversight Committee” (hereafter referred to as AOC or the Committee) authorized by the Durham County of North Carolina Board of Commissioners (BOCC).

AOC’s Mission Statement:
The Audit Oversight Committee of Durham County North Carolina is established and authorized by the Board of County Commissioners to provide oversight of the County’s internal audit function; to function in an advisory capacity to the County Manager and/or the BOCC regarding matters of internal control; and, to provide advice to the County Manager and\or the BOCC on matters related to financial controls. In addition, the AOC will annually review the CAFR which is compiled by the Finance Department with the external auditor’s reports/opinion included. The Audit Oversight Committee accomplishes it mission through three important qualities: independence, communication and accountability.

ARTICLE II
PURPOSE

SECTION 1.      This committee has been established as an oversight committee to the Department of Internal Audit and advisory committee to the County Manager and Board of County Commissioners.

The primary functions of the Audit Oversight Committee shall include be:

(a) To provide oversight responsibilities of the audit function (both internal and external);

(b) To serve in an advisory capacity to the County Manager;

(c) To facilitate communications among the Board of County Commissioners, the County Manager, and the Internal Audit Director;

(d) To pursue implementation of internal controls;

(e) To pursue County management implementation of report recommendations;

(f) To review annual audit plan and hourly audit budget and make recommendation to County Commissioners for approval;

(g) To work in concert with the Finance Director and the County Manager in making recommendations for the selection of the external auditor on a recurring basis; and

(h) To be briefed on the County’s Comprehensive Annual Financial Report (CAFR), Management Letter and Management’s Response after approval by the Local Government Commission. The AOC along with the County Finance Director will recommend acceptance by the BOCC.

The other functions of the Audit Oversight Committee shall include:

(i) To recommend to the Board of Commissioners and County Manager the hiring of independent professional consultants or counsel if necessary to address specific issues that cannot be handled internally to fulfill the fiduciary responsibilities of the AOC.

ARTICLE III
MEMBERSHIP

SECTION 1.      The Board of County Commissioners of Durham County shall appoint the Chairman and one other Commissioner as well as three (3) members of the business community to be voting members of the AOC. The members will include a certified public accountant and persons with experience in finance or business. The County shall also appoint one Commissioner member to be an alternate member of the AOC. The County Manager shall be an ex-officio non-voting member of the AOC.

SECTION 2.      Members from the business community shall be appointed for a term of three years except for 2010 where term adjustments are made to accommodate staggered terms. Terms will be staggered to facilitate uninterrupted continuation of committee business. Commencing with appointments beginning in September, 2010, one term will be for three years, one term will be for two years, and one term will be for one year. Beginning in September 2011 each term will be for three years. The terms of the Commissioner members shall be consistent with their terms of election.

SECTION 3.      Except to the extent otherwise provided in the Bylaws, the alternate may participate in all proceedings of the AOC, including attendance at closed sessions, to the same extent as the five regular members. The alternate may vote only when a member (excluding the County Manager) is absent. The expression “voting members” excludes (i) the alternate except for the times that the alternate may vote, and (ii) the County Manager.

ARTICLE IV
OFFICERS

SECTION 1.      Enumeration of Officers. The officers of the AOC shall be a Chairman, Vice-Chairman, and Secretary. They shall do the customary work of such officers and shall be unpaid.

SECTION 2.      Election of Officers and Term of Office. The officers shall each be elected at the September meeting, take office immediately upon election, and serve until a successor is elected at the next September meeting. Each year during the June meeting the AOC shall appoint the Nominating Committee, composed of not less than three (3) voting members. The Nominating Committee will prepare a slate of nominees for offices of the AOC and will make its report to the AOC at the September meeting. The members present will vote by voice to elect the officers. The ballots shall be made public to the extent required by law. No officer shall serve more than two (2) consecutive terms in the same office.

SECTION 3.      Vacant terms of officers may be filled through action taken by the AOC.

ARTICLE V
RESERVED

ARTICLE VI
RESIGNATIONS

SECTION 1.      In the event that a member chooses to resign from the AOC, such member should notify the Chairman, in writing. The Chairman will then immediately notify the members of the AOC of any such resignations. The resignation shall be effective when the notification is received by the Chairman unless the notification specifies a later time.

ARTICLE VII
ATTENDANCE

SECTION 1.      If a member of the Audit Oversight Committee will be unable to attend a regularly scheduled meeting of the Committee, the member shall notify the Secretary or the Clerk to the Board prior to the time of the meeting. The AOC Secretary shall then record such absences as excused. Any other absence is unexcused.

SECTION 2.      If a member has two (2) consecutive unexcused absences from regularly scheduled meeting of the AOC, the Secretary shall notify the AOC Chairman of this. The AOC Chairman shall then call the absences to the member’s attention and encourage said member to actively participate on the AOC. If the member has two more consecutive unexcused absences after the above, the AOC Chairman shall notify the Clerk to the Board of the member’s lack of attendance at AOC meetings, so that the Board of County Commissioners may take whatever action it deems appropriate.

SECTION 3.      If a member is absent from more than one-third (1/3) of the regularly scheduled meetings during any July 1 – June 30 time period, it shall be the policy of the Board of County Commissioners, exercisable in its discretion, to remove that appointee, in the absence of showing good cause, and to make another appointment.

 ARTICLE VIII
QUORUM

SECTION 1.      Three (3) members, including the alternate but excluding the County Manager, shall constitute a quorum.

ARTICLE IX
MEETINGS

SECTION 1.      At a minimum, the AOC will meet on a quarterly basis. All meetings will be open to the public, to the extent required by N.C.G.S. 143-318.10.

SECTION 2.      The AOC Secretary will keep minutes of each meeting and offer them for Committee approval as the first item on the subsequent meeting agenda. Whenever possible, such minutes will be distributed to Committee members in draft form within a reasonable time after the meeting and in advance of the subsequent meeting. A copy of the approved minutes will be submitted to the Internal Audit Department.

SECTION 3.      Regular Meeting: Regular meeting dates, times, and places shall be determined by the committee. All members will receive five days written notice of any cancellations or changes in the regular meeting time or date or if the location of the meeting is changed.

SECTION 5.      Special Meeting. A special meeting of the AOC may be called by the Chairman or Vice-Chairman in the absence of the Chairman, or by a written request to the Secretary by two (2) voting members of the AOC. Five (5) days written notice of all special meetings shall be given to the members. Such notice shall state the time, place, and purpose of the meeting.

SECTION 6.      Notices of Regular and Special Meetings. Notices of meetings shall be given in accordance with N. C. G. S. 143-318.12.

SECTION 7.      Voting. Unless the Bylaws indicate otherwise, a majority of the voting members present and voting, with a quorum present, shall be sufficient for action.

ARTICLE X
RESERVED

ARTICLE XI
AMENDMENTS

SECTION 1.      The Committee may recommend that the Board of County Commissioners approve changes to these By-Laws by a two-third (2/3) vote of the voting members present and voting, or a special meeting called for the purpose, or a regular meeting, provided that in any of those cases the amendments shall have been submitted to the membership in writing at least two (2) weeks in advance of the meeting.