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Denver Art Museum

Objective

To assess elements of the city’s relationship with the Denver Art Museum, including agreements and accounting of city-owned assets, and to review selected museum policies and practices as well as the museum board of trustees’ governance of the organization.

Background

In 1893, several artists established the Denver Artists’ Club, which became the Denver Art Museum in 1923. In 1971, the museum opened its current location in downtown Denver.

The museum maintains over 70,000 works of art. Its mission is “to enrich the lives of present and future generations through the acquisition, presentation, and preservation of works of art, supported by exemplary scholarship and public programs” through permanent collections and temporary exhibits.

Why this matters

In 1893, several artists established the Denver Artists’ Club, which became the Denver Art Museum in 1923. In 1971, the museum opened its current location in downtown Denver.

Findings

The City’s Formal Relationship with the Denver Art Museum, as well as Its Ownership of Some Assets at the Museum, Is Unclear

Existing agreements between the city and the Denver Art Museum are outdated and insufficiently document several key elements found in city contracts with other cultural organizations — such as ownership of assets and the city’s participation in governance.
The city has not properly accounted for some of its assets used by or stored at the Denver Art Museum.

The Denver Art Museum Should Strengthen Its Art Inventory Planning and Practices, as well as Its Emergency Response Plans

The Denver Art Museum should improve its art inventory planning and practices — as well as database and badge access controls — to fully account for and protect all objects in its care.
The Denver Art Museum’s approach to emergency planning lacks some key elements — such as a formal risk assessment and a continuity plan — and emergency planning documents are inconsistent in the information they share.

The Denver Art Museum Board of Trustees Should Enhance Its Governance Approach

The board’s membership does not reflect the diversity of Denver and the surrounding area — in that women and people of color are underrepresented among the 35 trustees.
The board’s governing practices do not fully align with leading practices, such as limiting the number of consecutive terms trustees can serve.
The board’s bylaws have not been updated in 22 years and are, therefore, inconsistent with some current board practices.

Recommendations

1.1 Develop New Operating Agreement – The Denver Art Museum and the Mayor’s Office, with assistance from the City Attorney’s Office, should develop a new operating agreement that includes clear rights, responsibilities, and asset ownership to address gaps described in Table 1 of this audit report. This agreement should clarify the museum’s role as an “agency” for arts.

Mayor’s Office Response: Disagree Denver Art Museum Response: Disagree

1.2 Include City Representation on the Denver Art Museum’s Board of Trustees – The Mayor’s Office should work with the Denver Art Museum to add one or more mayoral appointees to the museum’s board of trustees. This city representation on the board should be a requirement documented in the board’s bylaws.

Mayor’s Office Response: Agree, Implementation Date – June 30, 2022
Denver Art Museum Response: Agree, Implementation Date – Sept. 30, 2021

1.3 Assign Oversight Responsibilities – The Mayor’s Office should assign and document a responsible agency and individual to manage the city’s agreement with the Denver Art Museum. This agency and individual should be the city’s centralized expert on the museum’s agreements and they should be responsible for overseeing the museum’s use of city funding, overseeing the annual review of city assets at the museum, and reviewing reports provided by the museum.

Mayor’s Office Response: Agree, Implementation Date – June 30, 2021

1.4 Reconcile City Assets at the Museum – The Denver Art Museum and the Controller’s Office should reconcile and document all city-owned assets used by or stored at the Denver Art Museum.

Mayor’s Office Response: Agree, Implementation Date – June 30, 2022 Denver Art Museum Response: Agree, Implementation Date – March 31, 2022

1.5 Assign City Custodian for Assets at the Museum – The agency that the Mayor’s Office designates to be responsible for museum oversight, as called for in Recommendation 1.3, should assign a city employee as an asset custodian for the city’s assets used by or stored at the Denver Art Museum. This custodian should be trained on asset-related city rules and processes, as well as the city’s agreements with the museum.

Mayor’s Office Response: Agree, Implementation Date – Dec. 30, 2021

1.6 Improve Internal Controls for Assets at the Museum – The Controller’s Office should ensure adequate internal controls over the city’s assets at the museum. This should include annually verifying that the list of city assets at the museum is complete and accurate. These duties could be assigned to the agency with museum oversight responsibilities or to an individual within the Controller’s Office.

Mayor’s Office Response: Agree, Implementation Date – June 30, 2022

1.7 Annually Verify Assets – The Controller’s Office should design and implement additional internal controls to verify at least annually that city assets related to entities under agreement with the city are properly recorded. When asset ownership questions exist or transactions have occurred during the year involving a separate entity, the City Attorney’s Office should be consulted to ensure the accounting treatment is consistent with the related agreement.

Mayor’s Office Response: Agree, Implementation Date – June 30, 2022

2.1 Update Policies and Procedures to Document Current Practices – The Denver Art Museum’s Exhibition and Collection Services Department should update the museum’s inventory guidelines appended to its collections management policy or create separate procedures to document the museum’s current practices related to missing and nonaccessioned collection objects.

Denver Art Museum Response: Agree, Implementation Date – Sept. 30, 2021

2.2 Update Policies and Procedures to Strengthen Oversight of Missing Objects – The Denver Art Museum should update the museum’s guidelines appended to its collections management policy or create separate documented procedures to strengthen its oversight of missing objects. Additional policy or procedure elements should include a process for analyzing missing objects to identify trends as well as standard steps for investigating and resolving missing objects.

Denver Art Museum Response: Agree, Implementation Date – Jan. 31, 2022

2.3 Update Formal Strategy for Collection Inventories – The Denver Art Museum’s Exhibition and Collection Services Department should update its current strategy for conducting inventories of the museum’s art collection that:

Identifies the museum’s priorities for physical inventories.
Identifies those parts of the collection that have not been inventoried in more than 10 years.
Includes an inventory schedule that allows as comprehensive an inventory as possible of all objects in the museum’s care within a stated time frame.

Denver Art Museum Response: Agree, Implementation Date – Jan. 31, 2022

2.4 Strengthen System Controls – The Denver Art Museum’s director of technology and its Registrar’s Office should update the ARGUS database to the version with audit trail capabilities, or they should restrict user access to delete object records and require and document a periodic review of objects marked as “missing.”

Denver Art Museum Response: Agree, Implementation Date – Jan. 31, 2023

2.5 Implement Additional Badge Controls – The Denver Art Museum’s Protective Services Department should implement an automated control to ensure badges cannot be valid for more than one year, or the department should establish a requirement for an annual review to identify and deactivate security badges that are active beyond the allowable period. The results of this review should be documented.

Denver Art Museum Response: Agree, Implementation Date – Jan. 31, 2021

2.6 Incorporate Leading Practices in Emergency Response Planning – The director of the Denver Art Museum should ensure the museum’s emergency response plan and processes incorporate practices recommended by leading organizations, as described in Figure 7 of this audit report — including developing a risk assessment and a continuity of operations plan, maintaining records for staff training attendance, and developing a process for the board of trustees to review and approve the emergency response plan.

Denver Art Museum Response: Agree, Implementation Date – Jan. 31, 2023

2.7 Reconcile All Emergency Response Documentation – The director of the Denver Art Museum should ensure museum staff reconcile all emergency response documentation to ensure procedures are aligned and consistent across various documents, including the emergency response plan and the flipbook.

Denver Art Museum Response: Agree, Implementation Date – Sept. 30, 2021

2.8 Develop and Document Formal Policy for Plan Development and Maintenance – The director of the Denver Art Museum should develop and document a formal policy for developing and maintaining the museum’s emergency response plan. This policy should outline a comprehensive approach to revising the emergency plan, and it should:

Define the roles and responsibilities for developing and maintaining the plan.
Describe the departments responsible for updating the plan and state their specific responsibilities.
Describe how revisions should be coordinated across departments.
Outline a formal review and approval process and review time frames.

Denver Art Museum Response: Agree, Implementation Date – Sept. 30, 2021

3.1 Develop and Document Formal Board Policies and Procedures – The Denver Art Museum Board of Trustees should develop and document formal recruitment, nomination, and renewal policies and procedures. These policies and procedures should include a periodic review of the board’s ideal composition (e.g., skills, experience, and diversity among trustees, officers, and committee members) and an action plan including descriptions of the board’s diversity goals and the steps necessary to achieve these goals. If necessary, the board should revise its bylaws to ensure consistency with its current recruitment and nomination practices.