Agenda Item
City Council
Item #: 3.7. 3/14/2023 File #: 23-0152
TO: Honorable Mayor and Members of the City Council
THRU: Tom Kisela, Interim City Manager
FROM: Susan Galvan, Assistant City Manager
1. SUBJECT
First Amendment to Agreement with Lance, Soll, & Lunghard, LLP for additional financial reporting services and a one-year term extension.
2. SUMMARY
The original agreement with Lance, Soll & Lunghard, LLP for Financial Audit Services was for three years, with two optional one-year extensions. Staff is recommending the First Amendment to the existing agreement to execute the first one-year extension; and for the addition of Financial Reporting services, which include the preparation and submission of the Annual Comprehensive Financial Report (ACFR) and the State Controller’s Report.
3. RECOMMENDED ACTION
Approve First Amendment to the agreement with Lance, Soll, & Lunghard, LLP to initiate first extension year and the addition of services for the preparation and submission of the Annual Comprehensive Financial Report (ACFR) and the State Controller’sReport and authorize the Mayor and City Clerk to execute on behalf of the City.
4. FISCAL IMPACT
The total expenditure for this agreement is $86,848.00 and will be funded through General Fund (100).
5. STRATEGIC PLAN GOALS
Goal 2: Be a fiscally healthy community
a: Expend fiscal resources responsibly.
d: Effectively manage and develop City assets.
6. DISCUSSION AND BACKGROUND
In 2021, the City entered into a three year agreement with Lance, Soll, Lunghard, LLP (LSL) for Financial Auditing services. The Finance Department recently requested a quote for services to assist with the year-end compilation and printing of the Annual Comprehensive Financial Report (ACFR) and State Controllers Report. LSL provided a proposal for the preparation, word processing, and printing of the City’s Annual Comprehensive Financial Report, in accordance with the requirements and standards of the Government Finance Officers Association, and the preparation City of Orange Printed on 3/9/2023Page 1 of 2
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Item #: 3.7. 3/14/2023 File #: 23-0152
requirements and standards of the Government Finance Officers Association, and the preparation and submission of the City’s Annual Financial Transactions Report required by the State of California’sState Controller’sOffice. The quoted amount for these additional services is $15,100 per year.
The Finance department currently hires a retired employee on temporary assignment to complete the ACFR report at an estimated total cost of $19,000, for 248.5 staff hours. Printing of the report is outsourced at a cost of $1,500. In FY22, the costs to the City for the preparation and printing of the ACFR totaled $20,500. LSL providing these services will result in an estimated cost savings of $5,400 per year.
In addition to cost savings, by having the auditing firm prepare the financial reports directly, the cumbersome process of cross-referencing information and time delays due to scheduling conflicts is eliminated. As a result, the process of financial reports preparation will be streamlined and conducted more efficiently, with fewer errors.
The original agreement term was for the fiscal years ending June 30, 2021, 2022, and 2023, with the option to extend the agreement for two additional terms of one year each. Staff is recommending a one-year extension and the additional services to be provided.
7. ATTACHMENTS
· First Amendment to Professional Services Agreement with Lance, Soll, Lunghard, LLP City of Orange Printed on 3/9/2023Page 2 of 2
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