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ITEM: |
CONSENT
CALENDAR |
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16. |
CONSIDER AUTHORIZATION TO
CONTRACT WITH HAYASHI & WAYLAND TO CONDUCT ANNUAL FINANCIAL AUDITS FOR
FISCAL YEARS 2009-10, 2010-11 & 2011-12 |
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Meeting
Date: |
June 21, 2010 |
Budgeted: |
Yes |
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From: |
Darby Fuerst, |
Program/
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Services & Supplies – |
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General Manager |
Line Item No.: |
Professional Services |
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Prepared
By: |
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Cost
Estimate: |
$28,350 (FY 2010-11 for FY 2009-10 audit) $89,400 (Three-year total) |
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General Counsel Review: N/A |
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Committee Recommendation: The Administrative Committee reviewed this item on June 15, 2010 and recommend approval. |
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CEQA Compliance: N/A |
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SUMMARY: The District is required to have an audit of its financial records performed on an annual basis. The latest three-year agreement with the firm of Hayashi and Wayland (H&W) to conduct the annual audit expired with the completion of the audit for Fiscal Year (FY) 2008-09. Due to the uniqueness of the District’s operations, including its involvement with the CAWD/PBCSD Wastewater Reclamation Project (Project), there is a high learning curve for auditors to become sufficiently knowledgeable with the District’s financial records to enable them to complete a timely and adequate audit. H&W has also conducted audits of the Project in the past, and although the Project currently utilizes a different auditing firm, H&W’s familiarity with the Project makes it much easier for them to incorporate the Project’s current financial information into the District’s audit report. Based on this familiarity with the operations of the District and the Project, as well as the excellent quality of past audits, District staff requested a new proposal from H&W.
H&W has submitted a three-year proposal to conduct the audits for FY’s 2009-10, 2010-11 and 2011-12 for the amounts of $28,350, $29,800 and $31,250, respectively. If the District were to choose a one-year engagement, the cost for FY 2009-10 would be $31,250. The proposed budget for FY 2010-11 includes $30,000 to fund the audit for FY 2009-10. District staff has contacted the fiscal officers of the Carmel Area Wastewater District and Pebble Beach Community Services District to obtain information about their annual audit costs. Based on a comparison of the estimated hours and fees paid by those two agencies, District staff determined that the quotes from H&W are reasonable and competitive.
RECOMMENDATION: District staff recommends that the Board
authorize the General Manager to enter into a three-year agreement with Hayashi
& Wayland, beginning with the audit for FY 2009-10, to conduct the annual
audit of the District’s financial records for a total three-year cost of
$89,400.
BACKGROUND: Annually, the District is required to secure an independent audit of its financial operations in conformance with the requirements set by the Governmental Accounting Standards Board (GASB) and the California State Controller. Due to the uniqueness of the District’s operations, including its involvement with the Reclamation Project, the District has used the accounting firm of H&W to conduct the annual audit of the District’s financial records since 1989. The audit for FY 2008-09 cost $27,000 and concluded the latest three-year agreement with H&W.
U:\staff\word\boardpacket\2010\20100621\ConsentCal\16\item16.doc