The URL can be used to link to this page

Home My WebLink About4.03 Financial Audit 08/09 Agmtti~ " ~1, J ~ ~~~ ~~ SUBJECT: CITY CLERK File # ~~^0-^3 ^~ 3I0 ' 3~v AGENDA STATEMENT CITY COUNCIL MEETING DATE: FEBRUARY 17, 2009 ATTACHMENTS: Authorization to engage the Firm of Caporicci & Larson to Conduct the Fiscal Year 2008/2009 Financial Audit Report Prepared by: Ad Hoc Audit Subcommittee -Mayor Tim Sbranti and Councilmember Kate Ann Scholz; and Paul S. Rankin,P~ Administrative Services Director 1. Engagement Letter from Caporicci & Larson dated January 30, 2009 addressed to Paul Rankin, Administrative Services Director RECOMMENDATION: Authorize the Mayor to execute the Engagement Letter and direct Staff to proceed with planning for the completion of the Fiscal Year 2008/2009 Financial Audit. FINANCIAL STATEMENT: Total cost of the proposed engagement is $31,400, which represents no change from the amount billed for the Fiscal Year 2007/2008 Financial Audit. DESCRIPTION: The firm of Caporicci & Larson, Certified Public Accountants has conducted the financial audit for the past five consecutive years for the City of Dublin. The firm was selected following a Request For Proposal process in 2004. The current agreement was established with a five year term and the completion of the Fiscal Year 2007/2008 audit would conclude the original scope of services. Typically an audit engagement is proposed as a multi-year agreement due to the intense data collection required at the outset of working with a new client. The Administrative Services Staff is currently in the process of implementing a new computer accounting system, which requires a significant commitment of staff resources. The new system is currently scheduled to go live in July 2009. If the City were to seek proposals for audit firms and select a new firm at this time, it would require a substantial commitment of staff resources as they balance adaptation to new software at the same time as new auditors, while preparing the Financial Statements for June 30, 2009. Given these conditions, Staff discussed the possibility of extending the current agreement for audit services with Ahmed Badwi the Partner at Caporicci & Larson assigned to the City of Dublin Audit. Although he has worked at various levels on the City Audit, the Fiscal Year 2007/2008 Audit was the first that he served in the capacity as Partner. As described in Attachment 1, Caporicci & Larson have agreed to extend their services for the Fiscal Year 2008/2009 Audit. The proposed fees are at the same rate as is being charged for the last Audit. The firm typically begins planning and scheduling of interim audit work in the Spring prior to the end of the Fiscal Year on June 30, 2009. COPY TO: Ahmed Badwi, CPA -Caporicci & Larson Page 1 of 2 ITEM NO. ~. G:~AuditWgreements~2009 ExtensionWgenda_lyrExtension.doc The concept of a one-year extension was discussed with the Ad-Hoc Audit Subcommittee when they met on January 28, 2009. There was an understanding of the challenges involved with conducting a Request For Proposals at the same time as implementing new software. The one-year extension would allow the City to complete the Fiscal Year 2008/2009 Audit and then conduct a Request For Proposals in advance of the audit for Fiscal Year 2009/2010. RECOMMENDATION Staff would recommend that the City Council authorize the Mayor to execute the Engagement Letter as presented, and direct Staff to proceed with planning for the completion of the Fiscal Year 2008/2009 Financial Audit. ~~a C ~~ Caporicci & Larson C'ertifie~l Public Accountants January 30, 2009 Mr. Paul Rankin Administrative Services Director City of Dublin 100 Civic Plaza Dublin, CA 94568 Dear Mr. Rankin: ~~a As you are aware, our current audit contract ends with the completion of the 2008 audit. I would like to take this opportunity to thank you for the confidence and support you and the City have provided us over the years. I would also like to take this opportunity to present this letter for your consideration regarding extending the Caporicci & Larson audit contract with the City, in accordance with our discussion at the Ad-Hoc Audit Committee meeting. As discussed the staff involvement with installing a new accounting system at the same time as securing new auditors is a significant impact on City resources. Over the past years, we have developed an understanding of the City's operation that has aided us in providing quality audit services.. -With that knowledge, we've been able to expand our audit efforts and provide observations that have assisted City staff. We have also demonstrated our ability to respond to requests of the City and our ability to deliver a quality product. We trust the City has been satisfied with our efforts. We would like to propose an extension of our audit contract for the fiscal year ending June 30, 2009. The objective of our audits is to issue an opinion regarding the fairness of presentation of the City's financial position for each year in accordance with generally accepted accounting principles. The audits to be performed will follow generally accepted auditing standards, U.S. General Accounting Office's Government Auditing Standards, Single Audit Act, and OMB A-133. As of today, we are not aware of any legal requirement to rotate audit firms. However, in an attempt to assist the City to comply with recommendations offered by the Government Accountability Office regarding this matter, we have assigned a new engagement partnex to the City of Dublin to be responsible far reviewing City's financial records. Toll Frce Ph: (87?) 862-2200 (baic3asea7. ~rase~;e C:aosntrc~ 78Q GranHAvc.,Suite t365 ~ Corporate Park, Suite 10(. C~~1en~.c~alitin'nia.9u(i?:' -in~ine°,.:;aY~?urr ;3~~!?? ~t~~y~3 ~~17~~~~. Attachment 1 Toll Free Far: (866) 436-097 5aaaraveo<:mttn 4a.rc )ITverym. ~'' Campus Commons Ru., Suite 200 485fl lther~urv: Suite 7 C(ro 'ri:u'rimentu,f;ailornr~c f2s'~ Sar,11+^ ~ rG*~~rnr!'727,' Mr. Paul Rankin City of Dublin Page 2 ~~ Our proposed professional fees to perform the audit services to the City for the year ending June 30, 2009, will remain at the 2008 levels as follows: Audit Year Amount For the year ending June 30, 2009 $31,400 It is our understanding that you will need to first obtain authorization from the City Council. If the City agrees with the foregoing, please sign the copy of this letter in the space provided and return it to us. We would very much like to continue our relationship with the City and stand ready to provide the level of service and commitment for which the City has become accustomed. If you have any questions, please feel free to call me using our toll-free number (877) 862- 2200, ext. 146. Sincerely, Ahmed Badawi Partner This letter correctly sets forth the understanding of the City of Dublin as listed above. Acknowledged by: City of Dublin Date