Camarillo City Council
AGENDA REPORT
Date: June 26, 2024
To: Honorable Mayor and City Councilmembers
From: Greg Ramirez, City Manager
Submitted by: Mark Uribe, Finance Director
Subject: Financial and Auditing Services – Second Amendment
BACKGROUND
Financial and auditing services are provided by an independent auditing firm to ensure transparency, accountability, and effective management of public resources.
The auditors examine the City’s financial records, internal controls, and compliance with laws and regulations.
On February 23, 2022, the Camarillo City Council approved a professional services agreement for financial and auditing services with CliftonLarsonAllen, LLP (CLA) for a three-year term for a not-to-exceed amount of $249,700, which includes a 10% contingency (Agreement No. 2022-14).
On September 22, 2022, a first amendment was executed for CLA to provide professional information technology assessment and consulting services to the City for a not-to- exceed amount of $22,500 which utilized a portion of the 10% contingency approved in the original agreement (Agreement No. 2022-14A).
DISCUSSION
Annual budgeted amounts for financial and auditing services include a Single Audit portion which is an audit of the City’s financial statements and its compliance with Federal program requirements. This type of audit is required for all non-federal entities that receive and expend more than $750,000 in federal funds in one fiscal year.
The current agreement includes the audit of one major program as part of the Single Audit with each additional single audit major program costing an additional $2,500 per program.
The City auditor selected three major programs in FY 2022 and two major programs in FY 2023 which exceeded the budgeted and agreement cost. Staff is requesting an amendment to the agreement for additional auditing services in an amount of $8,000 for the remainder of the FY 2023/24 due to the unanticipated costs for single audit major
Financial & Auditing Services - Agreement Amendment
June 26, 2024
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programs selected in prior fiscal years along with anticipated costs for the audit of an additional major program for FY 2024.
Currently, CLA provides professional guidance, knowledgeable audit staff, industry- specialized insight and resources, and years of experience auditing comparably sized cities. To ensure the continuation of these valuable services, staff is also recommending extending the current agreement for an additional two (2) fiscal years for financial and auditing services for fiscal years ended June 30, 2025, and 2026. The proposed second amendment includes a 5% annual escalator for each additional fiscal year for a not-to- exceed amount of $172,284.
Auditing services include the City-wide financial audit, Single Audit, GANN limit, and the preparation of the City-wide State Controller’s Report. The total for an additional two fiscal years is $172,284, which includes an additional $2,500 per year for the audit of one additional major program along with a 10% contingency to be used as needed for additional services that may be required during the audit process for not-to-exceed $189,512, for a total agreement amount of $429,984.
FISCAL IMPACT
Funds for audit services are included in the General Fund Account No. 101-1501-415.32- 41 and the Successor Agency Fund Account No. 295-6895-462.32-41 budgets. Audit costs in the future fiscal years will be appropriated through the budget process.
RECOMMENDATION
Authorize the City Manager to execute Agreement 2022-14B with CLA for audit services for not-to-exceed amounts of $8,000 for Fiscal Year 2023/24, $84,102 for Fiscal Year 2024/25 and $88,182 for Fiscal Year 2025/26 plus a 10% contingency for FY 2025 and FY 2026 for any additional financial and auditing services that may be required.
ATTACHMENTS
1. Second Amendment to Agreement 2022-14 CiftonLarsonAllen (CLA) PSA
2. Agreement 2022-14 CiftonLarsonAllen (CLA) PSA
3. First Amendment to Agreement 2022-14 CiftonLarsonAllen (CLA) PSA REFERENCE MATERIALS – AVAILABLE FOR REVIEW AT CITY HALL None