PREPARED BY
LSL, LLP
Certified Public Accountants
License Number 2584
City of Orange
Payroll Process Procedures
Date of Submission: October 22, 2025
Valid for 90 Days
Authorized by:
Ryan Domino, CPA, Partner
[email protected]
500 Technology Drive
Suite 350
Irvine, CA 92618
(949) 829 - 8299
City of Orange
Payroll Process Procedures
1 www.lslcpas.com | 1
October 22, 2025
City of Orange
Attn: Trang Nguyen, Finance Director
300 East Chapman Ave.
Orange, CA 92866
LSL, LLP ("LSL CPAs," "LSL") is pleased to present our technical expertise in attestation services for the City of Orange ("City"). We value the opportun ity to demonstrate our professional qualifications and why our services are second-to-none.
This qualifications proposal hi ghlights our firm’s strength and stability, along with our knowledge, passion, and creative problem-solving capabilities as a leader in the field of governmental finance, accounting, and auditing. Our dynamic tea m is comprised of top talent within the industry, and with our comprehensive governme nt experience - we believe you will find that LSL CPAs is one of the best-qualified accounting firms to provide these services for the City of Orange.
SPECIFIC APPROACH TO SCOPE OF SERVICES
LSL has a structured and well-tested approach to providing fina ncial auditing services.
Based on our understanding of the City’s needs, our team is rea dy to assist with performing agreed-upon procedures to analyze the City’s payroll processes.
For 2026, LSL shall perform the scope of work outlined in the S cope of Work section of this quote for the purpose of providing assurance on the City’s tenant’s compliance with the terms and conditions of the lease agreement. The deliverable will be an Agreed-Upon Procedures report prepared in acco rdance with Statement on Stan dards for Attestation Engagements No. 19, issued by the American Institute of Certified Public Accountants in December 2019 (SSAE 19).
QUALIFICATIONS/PERSONNEL
LSL Partner, Ryan Domino, CPA, will be responsible for overseeing this engagement. He currently serves as a technical reviewer for the Government Finance Officers Association (GFOA) and regularly presents at our firm’s annual GASB Update and at CSMFO’s chapter meetings where he presents and trains on the latest GAS B pronouncements.
Ryan is an expert on Single Audit planning and execution and ho lds advanced certification from the AICPA.
City of Orange
Payroll Process Procedures
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Ryan provides our clients with a competitive advantage as a member of GFOA’s Special Review Committee for the Award for Excellence in Financial Repo rting and can provide valuable insights and recommendations to help organizations ach ieve excellence in financial reporting.
All our government partners and team members have worked within government agencies for most of their careers and are experts in their res pective fields. Ryan will assign the best professionals who have expertise in auditing an d a range of complementary subjects. The t eam’s experiences and skills gaine d from previous assignments are tailored to meet the specific needs of the City.
Our proposal is a firm and irrevocable offer for 90 days following the closing date of receipt. For this proposal, Ryan Domino, CPA, Partner, is autho rized to make representations for our firm. He can be reached at (949) 829 - 8299 or at [email protected].
Sincerely,
Ryan Domino, CPA, Partner
LSL, LLP
500 Technology Drive
Suite 350
Irvine, CA 92618
(714) 592-1814
City of Orange
Payroll Process Procedures
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Scope of Work
EMPLOYEE COMPENSATION REVIEW
Proposed Procedures
1. We will obtain and review the various City policies, applica ble MOU, and any other documentation prepared by to gain an understating of pay rates, pay dates, and types of pay offered to employees.
2. We will select a statistical sample of employees for various pay dates during the fiscal year throughout the City and recalculate their pay per the payr oll registers to the employees’ personnel action form s, timesheets, and MOU for thei r bargaining unit.
The statistical sample will c onsider no less than 7 employees f rom each MOU with different positions/job titles ( positions/job titles including levels 1, 2, 3 should be considered the same position/job title).
3. We will recalculate and verify all regular, overtime, leave, and special assignment pay identified in the sample to ensure no discrepancies.
4. We will verify that all pay r ates in the sample were approved by the appropriate level of authority and that all payment is supported by appropriate documentation, including time sheets or workflows.
LEAVE AND TIME-OFF PROCEDURES
Proposed Procedures
1. We will obtain and review the City’s policies regarding spec ial leave programs, including military leave pay and short-term disability programs against applicable laws and MOU.
2. We will obtain an understanding of the City’s practices rega rding all Leave Benefits and payouts.
3. We will review the City’s calculations of employee Leave Ben efits banks and ensure the employee accruals are calculated in accordance with the City policies and MOUs.
4. We will verify through a statistical sampling of employee le ave usage that CTO is removed from employee leave banks as used, and that amounts are paid to employees using appropriate pay rates. We will verify through a statistical sampling (specified above) of employee l eave usage and payouts are remov ed from the employee leave banks and the amount s paid out to the employee a re calculated in accordance with the MOUs.
City of Orange
Payroll Process Procedures
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5. We will review and recalculate any shift differential/fatigu e/on-call/standby pay calculations and ensure that the City complied with the Fair La bor Standards Act (FLSA), City policies and MOUs.
PAYROLL COMPLIANCE AND INTERNAL CONTROLS
Proposed Procedures
1. We will gain an understanding of the City’s internal control s and procedures through inspection of City policies and written procedures, interviews with City staff, and a test of controls utilizing statistical sampling methods to ensure that controls are effectively designed and implemented.
2. We will examine and test any IT or computer controls, includ ing password, access rights, and data management practices to ensure that controls are effectively designed and implemented.
3. We will provide feedback to t he City regarding the industry’s best practices for any key controls identified to be substandard or improperly designed or implemented.
OVERTIME PAY REVIEW
Proposed Procedures
1. We will obtain an understanding of the City’s overtime practices outlines in MOUs and City Policies.
2. We will review the City’s OT policies and practices and MOU against the requirements of FLSA
3. We will verify overtime calcu lations through a statistical sampling (specified above) to ensure compliance with both FLSA and MOUs guidelines.
ESTIMATED FEE
Based on our review of the Scope of Work and the estimated hours necessary to complete it, our fee for this engagement w ill be a not-to-exceed amount of $13,500. This fee is contingent upon the cooperation and quality of documentation provided by the City. Any overages in costs or hours will be discussed with the City prio r to any additional billing being prepared. The table below outlines the fee by procedure in the scope of work:
City of Orange
Payroll Process Procedures
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Our hourly rates by level are as follows:
Progress billings will be pr epared, covering not less than one month, and no more than one invoice will be provided to the City per month. The final 10% of the fee will be payable to LSL upon completion of the Scope of Work and acceptance of the Final Deliverable by the City. Invoices are payable upon receipt by the City.
QUALIFICATIONS & EXPERIENCE
LICENSE TO PRACTICE
LSL CPAs is a limited liability partnership and is not a wholly owned subsidiary of a parent company. LSL is a public accounting firm licensed by the State of California Department of Consumer Affairs as a Public Accounting Partnership. Additio nally, we are members of the American Institute of Certified Public Accountants (AICP A) and the California Society of Certified Public Accountants (CalCPA).
All key members assigned to this engagement are licensed as Cer tified Public Accountants by the State of California or are in the process of obtaining their license.
DESK REVIEWS/DISCIPLINARY ACTION
There have been no disciplinary actions against our organizatio n since its inception.
There have been no litigations against our firm in the past thr ee years. Our Single Audit reports are desk reviewed either by the federal cognizant agency or the State Controller’s Office acting as the Oversight Agency.
Position
Hourly
Rate
Partner $390
Director $320
Senior Manager $290
Manager $250
Supervisor $210
Senior $190
Experienced Staff $160
Staff $140
Clerical $120
City of Orange
Payroll Process Procedures
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We have never had a report rejected by any of these agencies, w hich demonstrates our thorough understanding of federal grant programs. LSL is highly regarded and recognized by the staff of the State Controller’s Office for top-quality reports.
CONTINUING EDUCATION
As a firm policy, all professiona l government staff meet the re quirement of 40 hours of continuing education every year, with at least 24 hours in gove rnmental accounting and auditing in a two-year period. We strongly emphasize profession al development and continuing education to ensure t hat our team members are up to date on the latest developments in governmental accounting and auditing. Our educa tional programs include training from CalCPA, AICPA, Government Audit Quality Center, and GFOA.
RECENT EXPERIENCE
As a firm, we have extensive experience with municipalities inc luding cities, counties, water and electric utilities, special districts, joint powers authorities, and compliance with OMB Uniform Guidance. We are familiar with all federal and state grant programs typically awarded to municipalities. General ly, our government sector ser vices are broken down into the following major classifi cations: attestation, complian ce, consulting, interim staffing, strategic planning, and tax services.
Our collective experience in local government accounting and fi nance, backed by our comprehensive understanding of all federal and state grant prog rams awarded to municipalities and internal controls, has refined our developme nt of efficient procedures and streamlined work plan approach, which we believe makes LSL one of the best- qualified teams to perform these services.
PEER REVIEW
Our firm has participated in the AICPA Peer Review Program sinc e its inception. All our peer reviews have covered governmental engagements and have received pass ratings.
Our most recent peer review conducted by Spafford and Landry CPAs is provided on the following pages.
City of Orange
Payroll Process Procedures
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City of Orange
Payroll Process Procedures
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