LOCAL GOVERNANCE ACT CERTIFICATION

Chapter Process

Evaluate Develop Approve & Implement Certification Review

Evaluate Develop Five After 3 months of

Present FMS Manual
existing internal Management System operation under FMS,
to community
control structure (FMS) Policies & request certification
for approval
and accounting Procedures Manual review from OAG
system

Submit documents
to OAG for review
Assign internal
control responsibilities
to staff and officials
Letter asserting
Implement FMS Chapter is using
Correct any internal Policies and FMS
control deficiencies Procedures Copy of approved
FMS Manual
Accounting Chapter resolution
Policies & Procedures

Personnel approving FMS

Procurement Chapter Meeting
minutes approving
Property FMS
Records Financial
Management Statements
Continually evaluate
covering 3 most
FMS to ensure it is recent months
operating efficiently
and as intended

Initiate OAG
Process

Review FMS Manual Obtain an Understanding
Obtain an understanding
Receive LGA
Certification
request from
Chapter
Review FMS manual for
completeness and adequacy
in reference to controls
over Chapter operations
Provide copy of FMS Manual
to Legislative Counsel for
compliance review with
Navajo Nation
laws and regulations
LOCAL GOVERNANCE ACT CERTIFICATION
Office of the Auditor General Process page 1
Evaluate and Test Controls Review Financial Statements
Evaluate design
of the internal Review financial
effectiveness of
control structure and statements for
internal control system
accounting system reliability and
accuracy
Test operating
effectiveness of the Statement of Revenues,
internal control system Expenditures and
Changes in Fund Balances
Statement of Revenues,
Inquire with Chapter Expenditures and
staff and officials Changes in Fund Balances
- Budget & Actual
Review Chapter Balance Sheet
records How are the
controls applied?
Observe Chapter
operations & activities
Are the controls
consistently applied?
Who performs
the controls?
 LOCAL GOVERNANCE ACT CERTIFICATION
Office of the Auditor General Process page 2

Favorable Unfavorable
Determine Assurances Issue Recommendation
Recommendation Recommendation
NO! The Chapter's
Determine if system provides FMS does not provide
reasonable assurances that: reasonable assurance
1. Financial reporting is
reasonable and accurate
2. Assets are adequately Submit letter to the
safeguarded TCDC and the Chapter
3. Laws and regulations are providing an unfavorable
complied with recommendation for
Chapter LGA Certification
Does the FMS
provide
reasonable NO
assurance of Issue letter to the
accountability? Chapter reporting the
Issue unfavorable deficiencies and
recommendation recommendations for
corrective action
YES! The Chapter's
FMS provides
reasonable assurance Chapter implements the
recommendations for
corrective action
YES Submit letter to the
TCDC and the Chapter
providing a favorable
recommendation for After 3 months of operation
Chapter LGA Certification under the revised FMS,
Issue favorable
Chapter will request for
recommendation
another LGA certification
Initiate TCDC review
Certification
Process
 LOCAL GOVERNANCE ACT CERTIFICATION
Transportation and Community Development Committee Process

Legislative Review
Certification Package Approval Chapter Certification
Process

Upon favorable
The Office of Legislative
recommendation, the
Proposed TCDC resolution Chapter President Services finalizes the
Chapter submits a
is drafted by Office of presents proposed adopted resolution and Chair
certification package thru
Legislative Counsel resolution to TCDC certifies it.
the legislative review
process

After the proposed resolution

is drafted Office of Legislative
Services assigns it a number
Letter to OAG The FMS policies and
requesting FMS procedures are read
review into the record LGA
Copy of After the proposed resolution
Chapter's FMS
manual
is given a number Speaker
assigns the proposed
Certified
Certification Package

Resolution resolution to committee. In

approving FMS this case the Transportation
manual and Community Development TCDC approves
(TCDC) Chapter governance
Resolution
recommending certification
LGA certification
OAG letter
TCDC Chair places the
recommending
proposed Council resolution
LGA certification
on the agenda for the next Proposed
Proposed TCDC TCDC resolution
regular meeting. The
resolution
Committee addresses all approving governance
approving LGA
certification amendments (markups). certification