AgdaPkt 2016-09-12 Closed and Joint SA PFA

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REPORT To the Honorable Mayor and City Council From the City Manager September 12, 2016 SUBJECT Amend Agreement for Auditing Services with Badawi & Associates RECOMMENDATION Approve, by motion, Amendment No. 1 to the Agreement for Professional Services with Badawi & Associates to include the City’s Comprehensive Annual Financial Report for FY 2015-16 BACKGROUND The City engages an independent certified public accountant to conduct an audit on the City’s financial records each year. The independent auditor, Badawi & Associates (Badawi), has been the City’s auditor since the Fiscal Year 2011-12 audit. The general scope of services covered in the existing contract includes audit of the City’s financial statements, examination of internal accounting controls, written reports on compliance and controls, presentations to the Council’s Audit Committee and consultation throughout the year on implementation of Government Accounting Standard Board (GASB) requirements, including GASB 68 and other relevant accounting regulations. ANALYSIS This amendment to the original agreement is to include an additional service, the preparation of the City’s Comprehensive Annual Financial Report (CAFR). Historically, the City’s CAFR has been completed by the City’s Financial Services Manager. Due to staffing transitions (retirement of the Financial Services Manager and hiring of new Assistant City Manager for Administrative Services) and the technical expertise and the tight timeline required to complete a CAFR, staff recommends contracting with Badawi & Associates to complete this critical document. Staff reviewed its recommendation to amend the contract with Badawi & Associates with the Audit Committee on August 22, 2016. The Committee recommended approval of the amendment. ALTERNATIVES The City Council may direct staff to complete the CAFR report or to begin an RFP/RFQ for the completion of the CAFR. Because of the existing relationship with Badawi, staff 6.1.I. - Page 1