CITY OF HOWELL REQUEST FOR PROPOSAL AUDITING SERVICES FOR THE FISCAL YEARS JUNE 30, 2010-2012
City of Howell INTRODUCTION General Information The City of Howell is requesting 3 and 5 year proposals from qualified firms of Certified Public Accountants to audit its financial statements starting with the fiscal year ending June 30, 2010. The continuation of the contract after each year is solely at the discretion of the City of Howell. There is no expressed or implied obligation for the City of Howell to reimburse responding firms for any expenses in preparing proposals in response to this request. During the evaluation process, the City reserves the right to retain all proposals submitted and to use any ideas in the proposals regardless of whether the proposal is selected. Submission of a proposal indicates acceptance by the firm of the conditions contained in this request for proposal, unless clearly and specifically noted. The contact person regarding this RFP is Catherine Stanislawski, Finance Director/ Treasurer and can be reached at (517) 546-3500. Copies of the auditor s reports for prior fiscal years can be obtained at the State of Michigan Dept of Treasury local audit report website. Terms of Engagement A three and/or five-year contract that is subject to an annual review by the City Manager, the satisfactory negotiation of terms (including a price acceptable to both the City and the selected firm) and the concurrence of the City Council. In the event of a merger of the audit firm with another firm of certified public accountants or the change of partners to the audit firm, this contract will be transferable to the successor firm with the approval of the City. 2
City of Howell SPECIFICATIONS FOR AUDITING SERVICES Your examination will be conducted in accordance with generally accepted auditing standards as set forth by the American Institute of Certified Public Accountants, the standards applicable to financial audits contained in the Government Auditing Standards and any other applicable standards. Your engagement will include any other tests of the accounting records and such other auditing procedures you consider necessary in the circumstances. Your audit will need to address the requirements of and be in compliance with all State of Michigan, Federal, GAAP and any other applicable requirements. The City also may have the necessity for a Single Audit dependent upon the amount of Federal Grants awarded. Cost for a Single Audit will be negotiated between the two parties. The services shall include an audit of the 2010-11 financial statements as well as compliance with pertinent statutory and internal control regulations. Internal control systems will be documented and examined to identify any weaknesses. Any areas of identified risks by the auditor or Council members will be sufficiently examined to determine if proper procedures have been followed or should be implemented. The audit will comply with GASB 34 requirements. The level of audit necessary is that which at the conclusion of the audit, Council members and audit staff are satisfied that the City s financial statements are free of material misstatements and control policies are in place or recommended that deliver efficient and lawful procedures for the City. The auditors shall be required to make an immediate written report of all irregularities and if illegal acts or indications of illegal acts of which they become aware, to the Mayor, City Manager and Finance Director. ASSISTANCE TO BE PROVIDED TO THE AUDITOR The Finance Department and responsible management personnel will be available during the audit to assist in the performance of the examination. The finance department staff will also prepare balanced trial balances, work papers and schedules detailing the City s assets, liabilities, debt, expenditures and revenues. The City will make efforts to provide additional requested schedules in a timely manner. The City will provide the auditor with a reasonable workspace and access to telephones, photocopy, fax machines and wireless internet access. 3
WORKPAPER RETENTION AND ACCESS TO WORKING PAPERS All work papers and reports must be retained, at the auditor s expense, for a minimum of 3 calendar years after completion of the audit, unless the firm is notified in writing by the City of a need to extend the retention period. The auditor will be required to make any and all work papers available to the City upon request. TIMELINE The following is a list of key dates: Request for Proposals issued February 12. 2010 Due date of proposals March 5, 2010 City Council award contract March 22, 2010 Selected firm notified March 23, 2010 Contract signed by April 1, 2010 The firm shall contact the City Manager and Finance Director within two weeks after the audit contract has been awarded to establish a projected start date for the audit. The auditors must be able to substantially adhere to the following timeline for the audit: Interim work shall be completed by June 30, 2010. A detailed audit plan and list of schedules to be prepared by the City shall be provided by mid-july. The City will have all records ready for the audit and all management personnel available to meet with the firm s personnel by August 16, 2010. The auditor shall have a draft report and recommendations to management available by September 30, 2010. The City Manager and Finance Director will review the draft as expeditiously as possible. During that time period, the auditor should be available for any meetings required to discuss the audit reports. After any inquiries or concerns have been addressed, the auditor shall provide 20 signed copies of the final report to be delivered to the Finance Director. It is anticipated that the firm shall make its audit presentation to City Council no later than the first regularly scheduled meeting in November 2010. The City will not hold the firm to this date if information necessary to complete the reports has not been received by the firm from a third party or the City fails to provide the necessary information or documents. 4
To insure the quality of the audit, the City may request, from time to time, a report of the progress of the audit. If the proposing firm sees any problems with meeting this schedule, it should be noted in the proposal with an alternate schedule. PROPOSAL REQUIREMENTS 1) 3 hard copies of the proposal must be provided in a sealed envelope clearly marked Proposals for Audit Services City of Howell and will be accepted at: City of Howell ATTN: Catherine Stanislawski 611 E Grand River 2 nd floor Howell MI 48843 2) Proposals will be accepted through 2:00 p.m. on March 5, 2010. Submitted proposals will not be opened until after the deadline. 3) No proposal will be accepted after the time specified for the opening of proposals. 4) The City reserves the right to reject any and all proposals submitted. 5) Email a copy of the proposal to cstanislawski@ci.howell.mi.us FORMAT OF THE RFP RESPONSE It is suggested that the RFP response be formatted as follows Title Page The response should identify the RFP subject and name of the independent auditor, local address, telephone number, name and title of contact person and the date of the proposal. Table of Contents The table of contents should include a clear and complete identification of the materials submitted by section and page number. Transmittal Letter A signed letter of transmittal briefly stating the firm s understanding of audit services to be performed, a commitment to perform the work within the time period and a statement why the firm feels itself to be the best qualified to perform the engagement 5
PROFILE OF THE INDEPENDENT AUDITOR The firm should provide an affirmative statement that it is independent of the City of Howell as defined by generally accepted auditing standards and that the firm and all assigned key professional staff are properly registered/licensed to practice in Michigan. Audit Firm 1) The proposal should state the size of the firm s governmental audit staff, the location of the office from which work on this engagement is to be performed and the number and nature of the professional staff to be employed on this engagement. These staff members should be identified as to whether each person is registered to practice in Michigan as a CPA, their level of governmental auditing experience and any relevant professional experience or education during the last five years. 2) A description of the range of services performed by the firm, including but not limited to this RFP. 3) A statement of the respondent s staff capability to audit Federal programs, including the number and classifications of personnel skilled in Federal auditing. 4) A description of the firm s experience assisting clients in their application for and receipt of the GFOA Certificate of Achievement for Excellence in Financial Reporting. WORKPLAN The proposal shall set forth a work plan. The work plan should include time estimates for each significant segment of the work and the staff level to be assigned. The plan should include an explanation of the audit methodology to be followed; what approaches the firm intends to follow concerning gaining understanding of the City s current system, the internal control structure and identify and examine any areas of weakness. The proposal should identify and describe any anticipated audit problems, the firm s approach to resolving these problems and any special assistance that will be requested from the City. SIMILAR ENGAGEMENTS WITH OTHER GOVERNMENT ENTITIES For the firm s office and personnel that will be assigned responsibility for the audit, list the most significant engagements performed in the last three years that are similar to the engagement described in this request for proposal. Indicate the scope of the work and the name and telephone number of the principal client contact. TOTAL ALL INCLUSIVE PRICE The firm shall provide pricing information relative to performing the audit engagement as described in this request for proposal on a yearly basis. The total all-inclusive maximum price is to include all direct and indirect cost including all out-of-pocket expenses. If you believe that additional services to those requested in this proposal are necessary, please 6
identify those services, your reasons for recommending such services, and the cost of the additional services. The firm will provide the hourly rates for partner in charge, senior and junior field staff. No additional costs may be incurred without the prior written approval of the City. CONTRACTUAL ARRANGEMENTS Invoices for services will be paid when received, with the final payment not to be issued until the City has received the firm s final reports. It is the firm s responsibility to bill for these payments. The City reserves the right to terminate the contract for audit at any time. Services rendered up to that point will be paid and the remaining contract will be nullified. OTHER Please include any other information that you think would be helpful in allowing the City to make an informed decision in the selection process. EVALUATION CRITERIA Proposals will be evaluated with a strict emphasis on quality. Attributes which will be analyzed include: 1) Number of governmental entities audited by the CPA firm proposing. 2) Firm s governmental resources available. 3) Training of personnel in government (and Federal Grant) auditing. 4) Quality of staff included in the assignment. 5) Reference responses. 6) Internal quality control procedures and external quality control review. During the evaluation process, the City Manager, Finance Director and possibly one or more of the Council members may, at their discretion, request any one or all firms to make oral presentations. The City will select a firm based upon its review of the proposals submitted. The City may request clarification of any items in the proposal. RIGHT TO REJECT PROPOSALS The City of Howell reserves the right without prejudices to reject any or all proposals. 7
Date: February 4, 2010 To: Audit Firms Having Expressed Interest in Responding to a Request for Proposals From: Catherine M. Stanislawski, Finance Director/ Treasurer Subject: Request for Proposal (RFP) The City of Howell is soliciting proposals from qualified firms of Certified Public Accountants to audit the City of Howell s financial statements for the fiscal year ending June 30, 2010, with the option of auditing the City of Howell s financial statements for the two/four subsequent fiscal years. Enclosed for your consideration is a Request for Proposal. To be considered for this engagement, your firm must meet the qualifications and satisfy the requirements set forth in the RFP. Completed proposals must be received at the address below by March 5, 2010. Catherine M. Stanislawski, Finance Dir/ Treasurer City of Howell 611 E Grand River 2 nd flr Howell MI 48843 Any questions or correspondence should be directed to me in writing at the above address or by calling (517) 546-3500. 8
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