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HomeMy WebLinkAbout06- Development Department DEVELOPMENT DEPARTMENT OF THE CITY OF SAN BERNARDINO REQUEST FOR COMMISSION/COUNCIL ACTION From: KENNETH J. HENDERSON Subject: AUDIT SERVICES Executive Director Date: March 25, 1993 ------------------------------------------------------------------------------- Synopsis of Previous Commission/Council/Committee Action(s): On April 9, 1990, the Community Development Commission approved an Agreement with KPMG Peat Marwick for audit services for the fiscal years 1989-90, 1990-91 and 1991-92. On March 25, 1993, the Redevelopment Committee recommended entering into an agreement with Rogers, Anderson, Malody and Scott for audit services for the fiscal years 1992-93, 1993-94 and 1994-95. ------------------------------------------------------------------------------- Recommended Motion: (Community Development Commission) MOTION: That the Community Development Commission approve, the attached agreement with Rogers, Anderson, Malody and Scott, Certified Public Accountants, for audit services for the fiscal years 1992-93, 1993-94 and 1994-95. l � Administrator KENNETH J. HENDE RkON, Executive Director Development Department ------------------------------------------------------------------------------- Contact Person: Ken Henderson/Barbara Lindseth Phone: 5065: 5081 Project Area: All Ward(s): 1 through 7 Supporting Data Attached: Staff Report FUNDING REQUIREMENTS: Amount: $30,500 Der yr Source: Tax Increment, BP Budget Authority: N/A ------------------------------------------------------------------------------- Commission/Council Notes: ------------------------------------------------------------------------------- KJH:BJL:1811A COMMISSION MEETING Meeting Date: 4/05/1993 Agenda Item Number: l� DEVELOPMENT DEPARTMENT STAFF REPORT ------------------------------------------------------------------------------- Audit Services In December 1992, the Economic Development Agency, Development Department, and the City of San Bernardino jointly issued a request for proposals for audit services for the fiscal year 1992-93, with proposals for multi-years services to be considered. Four (4) proposal were received by the deadline of January 11, 1993. The proposals were submitted by the following firms: Rogers, Anderson, Malody and Scott - One year contract price - $78,000 (combined City and Agency); three year contract price - $62,000 per year (Agency's portion $30,500). McGladrey and Pullen - One year contract price - $113,000; three year contract price - $103,000 (Agency's portion $53,550). Soren, McAdam and Bartells - One year contract price - $85,105 (with the possibility of a fifteen (15) percent discount); three year contract price from $82,370 to $85,650 (Agency's portion $40,820 to $42,450). Diehl, Evans and Company - One year contract price - $67,500; three year contract price from $70,500 to $742000 (Agency's portion $30,450 to $31,850). The four (4) proposals were initially reviewed by Barbara Pachon, City Finance Director; Barbara Lindseth, Administrative Services Manager; Fred Wilson, Assistant City Administrator; and David Kennedy, City Treasurer. Several factors were taken into consideration as these proposals were reviewed including: experience; ability to meet deadlines; cost of the proposal; and overall qualifications of the firm and of the staff members to be assigned to the audit of the City and the Agency. After this initial review, two (2) firms were selected to be interviewed - Diehl, Evans and Company, and Rogers, Anderson, Malody and Scott. These two (2) firms were chosen based upon the above mentioned criteria, with the strongest emphasis on the experience and the qualifications of the firm. Interviews were conducted by Barbara Pachon, Fred Wilson and Barbara Lindseth. After the interview, it was determined that Rogers, Anderson, Malody and Scott should be recommended for a three (3) year ------------------------------------------------------------------------------- KJH:BJL:1811A COMMISSION MEETING Meeting Date: 4/05/1993 Agenda Item Number: DEVELOPMENT DEPARTMENT STAFF REPORT Audit Services March 25, 1993 Page Number —2— -------------------------------------------------------------------- audit contract based upon their knowledge of the area and of the City, their experience with Redevelopment Agency and with City audits; their preparation for the audit interview; and other qualifications and experience. A three year audit is recommended over a one year audit contract due to the fact that the audit will be conducted more smoothly and more efficiently with the continuance of the same audit firm for a series of years. Staff recommends adoption of the form motion. KENNETH J. HENdERSON, Executive Director Development Department -------------------------------------------------------------------------- KJH:BJL:1811A COMMISSION MEETING Meeting Date: 4/05/1993 Agenda Item Number: !- V A G R E E M E N T THIS AGREEMENT, Made and entered into this .Zg "fit day of _ WAA.Z4 , 1993, by and between the City of San Bernardino Economic Development Agency, Development Department ("Agency"), and Roger, Anderson, Malody & Scott ("Consultant"). W I T N E S S E T H WHEREAS, the Agency desires certain auditing services, and WHEREAS, the Consultant warrants that it is trained, expert and experienced in the performance of such auditing services, 1. Consultant shall perform an audit of the following financial statements to be issued by the Economic Development Agency, Development Department, as of June 30, 1993; June 30, 1994; and June 30, 1995: a. General purpose financial statements of the Economic Development Agency, Development Department, of the City of San Bernardino. 2. Said financial statements will be prepared in accordance with generally accepted accounting principles. 3. Consultant shall also perform the audit specified in Section 1 above so as to satisfy the audit requirements imposed by the Single Audit Act of 1984, the U.S. Office of Management and Budget (OMB) Circular No. A-128, and in accordance with the applicable provisions of the Health and Safety Code governing Redevelopment Agencies of the State of California. 4. Consultant will conduct the audit in accordance with generally accepted auditing standards, including generally accepted government auditing standards for financial and compliance audits as set out in Government Auditing Standards issued by the Controller General of the United States, and the provisions of the Single Audit Act of 1984; OMB Circular A-128 Requirements for Grants to States and Local Governments. 5. Said audit shall be planned and performed in such a manner to obtain reasonable assurance about whether the financial statements are free of material misstatement. Said audit shall include examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. 6. In addition to its report on the Agency's financial statement, Consultant will also issue the following reports or types of reports: a. Report on the Agency's compliance with Section et seq., of the Health and Safety Code of the State of California. - 1- 7. Consultant's reports on internal accounting and administrative control will include any reportable conditions and material structural or operational weaknesses in the system of which it becomes aware. 8. Consultant's report on compliance matters will include any errors, irregularities or illegal acts, violations of compliance obligations and other responsibilities imposed by State and federal statutes and regulations, and assumed by contracts, and any State or federal grant, entitlement or loan program questioned costs of which it becomes aware. 9. The parties understand that the audit is subject to the inherent risk that material errors, irregularities, or illegal acts, including fraud or defalcations, if they exists, may not be detected. It is also subject to the inherent risk that violations of compliance obligations and other responsibilities imposed by state and federal statutes and regulations, or assumed by contracts, if they exist, may not be detected. 10. If circumstances relating to the conditions of Agency's records and/or the availability of sufficient competent evidential matter were to arise during the course of work which in Consultant's professional Judgment prevent it from completing the audit, or completing it in a timely manner, Consultant shall notify the Agency immediately in writing. In such a situation, Consultant retains the unilateral right to take any course of action permitted by professional standards including terminating this agreement. If circumstances relating to the ability of the Consultant to perform in accordance with Agreement arise, the Agency retains the unilateral right to take any course of action including terminating this agreement. 11. The parties understand and agree that at the conclusion of the audit, the Consultant will request certain written representations from Agency about the financial statements and matters relating thereto as well as certain compliance matters. 12. The assistance to be supplied by Agency personnel in the performance of the audit is described in client participation schedule attached hereto as Exhibit "A" and incorporated herein. 13. The timing of the preparation of schedules and analysis by Agency staff and the delivery of preliminary drafts and final copies of the reports will be coordinated by the Agency's Administrative Services Manager. 14. Representatives of Agency, other government audit staffs, and the U.S. General Accounting Office shall have access to the Consultant's audit working papers upon request. 15. Consultant shall keep and maintain the working papers for a period of at least three years after the date of the report, or for such longer period as requested by Agency in writing. - 2 - 16. The fee for the services described in this Agreement shall not exceed $30,500 annually for each of the three years, without prior written approval of Agency. The fee is composed of the following components: Audit of the Economic Development Agency's General Purpose Financial Statements including compliance report to the State of California $28,000 Compliance with the requirements if the Single Audit Act of 1984 and OMB Circular A-128 2,500 17. Consultant will be responsible for the preparation, typing, printing and binding of the Economic Development Agency's Financial Report. 18. Agency will provide Consultant with copies of the computer spreadsheet models used in preparation of the June 30 reports of each year, and a data file containing the "notes to financial statements". 19. Upon written notice to and approval by the Agency, the fees outlined in Section 15 of this Agreement may be services under the following conditions: a. Accounting assistance is necessary in order to properly close the Agency's books so that they will be suitable to audit. b. The information requested by Consultant in the Client Anticipation Schedule (Exhibit "A") is not provided, the information provided is not accurate and/or not complete, or is provided after the requested date. C* The Scope of Work is changed by written direction of the Agency. All other provisions of this Agreement will remain binding despite any fee adjustment. 20. If the Agency intends to publish or otherwise reproduce the financial statements and make reference to the firm name of Consultant, Agency agrees to provide Consultant with printer's proofs or masters for its review and approval before printing. Agency shall also provide Consultant with a copy of the final reproduced material before distribution. Nothing in this Section 20 shall prohibit or limit the obligation of the Agency to make copies of Consultant's report available to the public under the California Public Record Act (Government Code 6250 et seq.). - 3 - 21. Completion and submission of the report to the Agency shall be in such a timely manner to allow for distribution to the State of California and to the Agency's legislative body prior to December 31 of each year. Any delay of distribution to the State of California that can be attributed to a delay of the Consultant and any fines imposed by the State of California because of such a delay shall be the responsibility of the Consultant. 22. Any notice to be given from one party to the other pursuant to this Agreement is to be in writing and deposited with the United States Postal Service, postage prepaid and addressed as follows: To Agency: Administrative Services Manager Economic Development Agency Development Department 201 North "B" Street San Bernardino, CA 92041 To Consultant: Rogers, Anderson, Malody & Scott Certified Public Accountants Vanir Tower, Suite 300 290 North "D" Street San Bernardino, CA 92401 Nothing in this Section shall be construed to prevent the giving of notice by personal service. - 4 - 23. This Agreement constitutes the complete and exclusive agreement between the parties, superseding all proposals oral or written and all other communications, with respect to the terms of the engagement between the parties. IN WITNESS WHEREFORE, the parties hereto have executed this Agreement on the day and date first above shown. ECONOMIC DEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO By W.R. HOLCOMB, Chairman ROGERS, ANDERSON, MALODY & SCOTT By '.� By -- -- ATTEST: By APPROVED AS TO FORM AND LEGAL CONTENT Dennis Barlow Senior Assistant Cit Attorney By 1810A - 5 - l.0