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Department Approval <br />MEQUEST FOR, COUNCIL ACTION <br />Date: 11/17/08 <br />Item No.: 7.d <br />City Manager Approval <br />Item Description: Authorization to Negotiate a 3-Year Audit Services Contract <br />1� BACKGROUND <br />2 State Statute requires all municipalities to obtain an annual independent annual financial audit. <br />1 3 Historically, the City has entered into a 3-year contract with a local qualifi ed CPA firm to provide this <br />A� service. The current audit services contract with Malloy, Montague, Karnowski, and Radds evich (MMKR) <br />5 expires at the end of this year. <br />7 MM KR has been the City's auditors for the past 3 years. The City's Professional Services Policy allows <br />8 for the extension of the contract for an additional 3 years if the City is satisfi ed with the service provided <br />and it reasonably expects that the new contract will be competitive with other qualified service providers. <br />1 ity Staff believes that both of these criteria have been met and is therefore seeking authorization to <br />1� 1 negotiate a new 3-year contract with MM R. <br />1 2 <br />1 In the past 3 years, MM KR has consistently demonstrated superior knowledge of all federal and state laws, <br />1� 1111 and all generally accepting accounting and auditing standards applicable to the City's annual audit and <br />1� 5 financial report. Their professionalism and code of conduct in dealing with City Staff and the City Council <br />1� 6 has been excellent, and they have demonstrated a willingness to provide additional services as needed for <br />1 7 no additional costs. <br />1 There willingness to provide additional services was featured in 2007 by their repeated efforts to meet with <br />20 the Council to discuss the structure and merits of an Audit Committee. That same year, they worked with <br />2 1� City Staff to develop procedures to implement GAS B 45; a new financial reporting standard that takes <br />22 effect with the current fiscal year. In 2008, they provided additional staffing resources to help guide City <br />23 Staff in developing and documenting new mandated internal control and fraud prevention procedures. All <br />2,4 of these value-added services were provided at no additional cost. <br />25 <br />26 Based on prior bidding experience with the City of Roseville and dozens of other metro cities, MM KR has <br />27 regularly out-bid other qualified CPA firms in the area - evidenced by their client list which includes 79 <br />28 metro area governmental clients. Given this bidding history and knowledge of the City of Roseville's <br />2 financial operations, City Staff believes that MM KR would provide the lowest bid in an open bidding <br />Y"), environment. <br />ZZOMIN <br />