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REQUEST FOR COUNCIL ACTION <br /> Date: 12/08/14 <br /> Item No.: 7.e <br />Department Approval City Manager Approval <br />Item Description: Consider Approving a 3-Year Audit Services Agreement with Kern DeWenter <br />Viere (KDV) <br />B <br />ACKGROUND <br />1 <br />State Statute requires all municipalities to obtain an independent annual financial audit. The current 3-Year <br />2 <br />Audit Services agreement expired at the conclusion of the most recent audit and the City needs to secure a <br />3 <br />new Agreement for the upcoming audit slated to begin next month. <br />4 <br />5 <br />Under the guidelines of the City’s Professional Services Policy, new contracts are generally awarded after <br />6 <br />completion of a competitive selection process. However, the guidelines also specify that this requirement <br />7 <br />can be waived by the City Council if circumstances warrant. <br />8 <br />9 <br />City Staff conducted a competitive process in 2011 and received 5 bids that ranged from $93,180 to <br />10 <br />$114,200 over the 3-year period. The CPA Firm of Kern DeWenter Viere (KDV) had the lowest bid and <br />11 <br />was awarded the contract. KDV has submitted a proposal to renew their audit services contract for another <br />12 <br />3-year period with a 2.8% cost inflator over the 2014 amount. <br />13 <br />14 <br />Based on historical bidding experience, the current bid environment for audit services, and the proposal <br />15 <br />offered by KDV; City Staff believes that the costs associated with undertaking a competitive bid process <br />16 <br />will exceed any potential savings we might derive by not accepting KDV’s proposal. Over the past 10-15 <br />17 <br />years, KDV has consistently demonstrated that they are the lowest cost service provider while adhering to <br />18 <br />State and Federal auditing requirements and industry-recommended auditing standards. <br />19 <br />20 <br />Over the past 3 years, City Staff has had no disagreements with KDV’s audit process or findings, <br />21 <br />professional conduct, or quality of work. Staff is comfortable continuing the audit services relationship <br />22 <br />with KDV for another 3 years. As a result, Staff recommends the Council forgo a competitive bidding <br />23 <br />process and renew the contract with KDV for another 3-year period. <br />24 <br />PO <br />OLICYBJECTIVE <br />25 <br />A 3-year term for audit services is consistent with the City’s Professional Services Policy. <br />26 <br />27 <br />Page 1 of 2 <br /> <br />