|
ITEM: |
CONSENT
CALENDAR |
||||
|
|
|||||
|
22. |
CONSIDER
AUTHORIZATION TO CONTRACT WITH HAYASHI WAYLAND TO CONDUCT ANNUAL FINANCIAL
AUDIT FOR FISCAL YEAR ENDING 2020, 2021, and 2022 |
||||
|
|
|||||
|
Meeting
Date: |
June 15, 2020 |
Budgeted: |
Yes |
||
|
|
|||||
|
From: |
David J.
Stoldt, |
Program/ |
Services & Supplies |
||
|
|
General
Manager |
Line Item No.: |
Professional Fees |
||
|
|
|||||
|
Prepared
By: |
Suresh
Prasad |
Cost Estimate: |
$48,000 for 2020, $49,500
for 2021, $51,000 for 2022 Plus additional fee for CAFR
& GASB |
||
General Counsel Approval: N/A |
|||||
Committee Recommendation: The Administrative Committee reviewed this item on June 9, 2020 and recommended approval. |
|||||
|
CEQA Compliance: This action does not constitute a project
as defined by the California Environmental Quality Act Guidelines Section
15378. |
|||||
SUMMARY: The District is required to have an audit of its financial records performed on an annual basis. The three-year agreement with the firm of Hayashi Wayland (HW) to conduct the annual audit expired with the completion of the audit for Fiscal Year (FY) 2018-2019. 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. HW has also conducted audits of the Project in the past, and although the Project currently utilizes a different auditing firm, HW’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. This experience and familiarity will be beneficial to the District as it embarks upon the Pure Water Monterey project operation. Based on this familiarity with the operations of the District and the Project, as well as the excellent quality of past audits, District staff is requesting a new three-year proposal from HW.
HW has submitted a three-year
proposal to conduct the audits for fiscal year ending 2020, 2021, and 2022 in
the amount of $148,500. The base audit fee
includes costs to cover for Governmental Accounting Standards Board (GASB) 68
standards, which includes standards for pension reporting. In addition, additional fee would be incurred
each year for Comprehensive Annual Financial Report compilation as well as for
implementation and testing of other GASB standards, such as GASB75, new reporting
standards for Other Post-Employment Benefits, and State Controllers Report. The fee estimated for FYE 2020 including the
additional services is a not-to-exceed price of $68,000.
RECOMMENDATION: The Administrative Committee recommends that the Board authorize the Chief Financial Officer to enter into a three-year agreement with Hayashi Wayland to conduct the annual audit of the District’s financial records for a total cost of $148,500 plus additional fee for CAFR compilation and implementation of GASB standards.
BACKGROUND: Annually,
the District is required to complete an independent audit of its
financial operations in conformance with the requirements set by the
Governmental Accounting Standards Board 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 HW to conduct the annual audit of the
District’s financial records since 1989.
22-A Hayashi Wayland Audit Proposal
U:\staff\Boardpacket\2020\20200615\ConsentClndr\22\Item-22.docx