Piedmont City Council
July 1, 2024

City of Piedmont

COUNCIL AGENDA REPORT
DATE:

TO:

FROM:

SUBJECT:

July 1, 2024
Mayor and Council
Rosanna Bayon Moore, City Administrator
Consideration of a Contract for Auditing Services with Badawi & Associates for the Next Three Fiscal Years for an Amount Not to Exceed $169,940, and Option to Extend the Contract for an Additional Two Years for an Amount Not To Exceed $122,035.

RECOMMENDATION
Approve a contract for auditing services with Badawi & Associates, Certified Public Accountants, for the next three fiscal years for an amount not to exceed $169,940, and an option to extend an additional two years for an amount not to exceed $122,035.

BACKGROUND
The City of Piedmont utilized the audit services of MUN CPA’s for the past nine fiscal years.

The Government Finance Officers association recommends that Governmental entities should undertake a full-scale competitive process for the selection of independent auditors at the end of the term of each audit contract.

In April, the City of Piedmont sent out Request For Proposals (RFPs) for Auditing Services to undertake the Financial Statements audit, the Transportation Development Program audit, the Measure B Compliance audit, the Measure F Compliance audit, the Agreed-Upon Procedures for the Appropriations (Gann) Limit, the filing of the State Controllers Report, and any federally funded programs subject to the provisions of the Single Audit for Compliance.

The RFP was sent to four recommended accounting firms and was posted on the City’s website and California Society of Municipal Finance Officers (CSMFO) website. The City received four proposals, one of which was from the current auditors.

The Finance Director narrowed the four proposals to two firms were:
a. Badawi & Associates
b. Harshwal & Company
The two firms were interviewed by the Finance Director and the City Administrator. Both firms were qualified to perform the audit services, but the consensus from the interviews was Badawai & Associates was the better choice based on their experience and knowledge of governmental agencies, City’s in particular.

FISCAL CONSIDERATIONS
The fees for the three years plus an optional two year extension is shown below:

For comparison, the fees for the first year of this proposal is $6,135 less than the amount included in the Approved Budget, and $5,835 less than last year’s audit fees.

For reference the fee over the 5 year term from the other three proposals were: $254,125, $337,800, and $372,700.

ATTACHMENTS
A. Badawai & Associates Proposal
B. Agreement with Badawai & Associates
By: Michael Szczech, Finance Director
FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 TOTAL
Financial Statement 40,125$ 40,455$ 41,255$ 42,145$ 42,840$ 206,820$ GANN Limit 865 1,000 945 1,060 1,130 5,000
Measure B -
Measure BB 2,130 2,315 2,445 2,585 12,215 2,740
Measure F 2,130 2,315 2,445 2,585 12,215 2,740
Police Citation 1,705 1,865 1,975 2,095 2,230 9,870
SCO Report 2,990 3,265 3,455 3,530 16,990 3,750
Sub-Total 49,945 51,160 52,575 54,000 263,110 55,430
Single Audit 2,890 3,150 3,330 3,530 16,650 3,750
TDA 2,130 2,315 2,445 2,585 12,215 2,740
Total 54,965$ 56,625$ 58,350$ 60,115$ 61,920$ 291,975$
Agenda Report Page 2
City of
Piedmont

TECHNICAL PROPOSAL
For Professional Auditing Services for
the City of Piedmont
For fiscal years ending June 30, 2024 through 2026,
with the option of extending the contract for each of
the two (2) subsequent fiscal years.

April 22, 2024
Contact Person:

Ahmed Badawi, CPA
Badawi & Associates
Certified Public Accountants
2855 Telegraph Avenue, Suite 312
Berkeley, CA 94705
Phone: (510) 768-8244
Fax: (510) 768-8249
E-mail: [email protected]
Attachment A Agenda Report Page 3
Attachment A Agenda Report Page 4
City of Piedmont
Table of Contents
Page
Letter of Transmittal ................................................................................................................................................... 1 Firm Qualifications and Experience.......................................................................................................................... 3 Independence ........................................................................................................................................................... 3 Insurance .................................................................................................................................................................. 3 License to Practice in California................................................................................................................................ 3 Conflict of Interest ..................................................................................................................................................... 3 Firm Qualifications .................................................................................................................................................... 3 Technical Approach .................................................................................................................................................. 4 Firm Experience........................................................................................................................................................ 5 Additional Activities ................................................................................................................................................... 5 Client Training Seminar ............................................................................................................................................ 6 GASB 68 Firm Developed Tools and Assistance ..................................................................................................... 6 Flowcharting Documentation .................................................................................................................................... 6 Quality Control Review ............................................................................................................................................. 6 Federal or State Desk Reviews ................................................................................................................................ 9 Disciplinary Action..................................................................................................................................................... 9 Litigations.................................................................................................................................................................. 9 Partner, Supervisory, and Staff Qualifications and Experiences ........................................................................10 Similar Engagements with Other Governmental Entities.....................................................................................18 Understanding of Services to be Provided ............................................................................................................23 Specific Audit Approach ..........................................................................................................................................24 Objectives of Our Services .....................................................................................................................................24 Audit Approach .......................................................................................................................................................24 Technical Approach ................................................................................................................................................25 Use of Technology in the Audit...............................................................................................................................28 Audit Schedule..........................................................................................................................................................30 Discussion of Relevant Accounting Issues ...........................................................................................................33 Comprehensive Cost Bid .........................................................................................................................................34 Conclusion ................................................................................................................................................................. 36 Appendix ....................................................................................................................................................................37 References..............................................................................................................................................................37 Exceptions to the Contract......................................................................................................................................38 Attachment A Agenda Report Page 5
Attachment A Agenda Report Page 6
April 22, 2024
Letter of Transmittal
Mr. Michael Szczech
Finance Director
City of Piedmont
Administrative Office, City Hall
120 Vista Avenue
Piedmont, CA 94611
Dear Mr. Szczech:

Badawi & Associates (B&A), Certified Public Accountants (the “Firm”) is pleased to have the opportunity to respond to your request for a proposal to provide external audit services and to submit its qualifications to perform an independent audit of the financial statements of the City of Piedmont (the “City”) for the fiscal years ending June 30, 2024 through 2026, with the option of extending the contract for each of the two (2) subsequent fiscal years. The objective of our audits is to issue opinions regarding the fairness of presentation of the financial position of the City in accordance with generally accepted accounting principles. These audits are to be performed in accordance with generally accepted auditing standards, the standards set forth for financial audits in the Government Accountability Office’s (GAO) Government Auditing Standards, the provisions of the federal Single Audit Act of 1984, as amended in 1996, and the Uniform Guidance, Audits of States, Local Governments and Non-Profit Organizations, Uniform Administrative Requirements, as well as any other applicable federal, state, local or programmatic audit requirements.

We will also perform the following as part of our engagement:
- Single Audit (if required)
- Gann Limit Agreed-upon Procedures
- State Controller’s Report
- Measure BB
- Measure F
- Parking Citation Agreed Upon Procedures
- Transportation Development Act (TDA)
We will also apply limited audit procedures to Management’s Discussion and Analysis (MD&A) and required supplementary information. In addition, we will prepare the management letter containing comments and recommendations regarding our review and evaluation of the systems of internal control and accounting procedures.

This proposal will highlight the background of the partners and staff assigned to the engagement, summarize our experience in the governmental area, and describe our approach to auditing the City.

This proposal demonstrates our ability to render the quality examination and to perform the necessary accounting and auditing services requested by the City on a timely basis.

As a partner of the Firm, I will be the primary contact for negotiation of the contract. Additionally, I have been authorized to legally bind the Firm. You may contact me at the following address and phone number:

Ahmed Badawi, CPA
Badawi & Associates
Certified Public Accountants
2855 Telegraph Avenue, Suite 312
Berkeley, CA 94705
Telephone: (510)768-8244
E-mail: [email protected]
Attachment A Agenda Report Page 7
Mr. Michael Szczech
Finance Director
City of Piedmont

2 We are committed to performing the required work, completing the audit, and issuing the necessary auditors’ reports.

We believe we are the best qualified to perform the audit because our audit staff includes individuals well versed in municipal auditing and reporting requirements. We have performed auditing and consulting engagements for numerous cities throughout California. We will be responsive to the needs of the City, we understand the City’s operational environment, and pledge to you our complete commitment to providing a quality product that meets the City’s requirements.

The approach to the audit has been designed to meet the audit requirements of the City with the least disruption to the City’s office operations. The foundation of the audit approach is based on communication coupled with a strong knowledge of City operations and detailed planning at the initial stages of the audit. Open communication lines with all parties of the Engagement Team and City Management and staff throughout the engagement eliminate “surprises”.

Initial planning and proper assignment of duties to experienced personnel provide for an effective and efficient audit process. Consequently, inefficiencies and disruptions are kept to a minimum. In addition, we perform almost half of the audit tasks during the interim phase to minimize any unforeseen delays during the year-end phase and to ensure a smooth and timely audit process.

The Firm maintains liability insurance coverage for professional liability, Workers’ Compensation, Comprehensive General Liability and Auto as part of our comprehensive insurance policy.

The Firm is an Equal Opportunity employer and complies with all Federal and State hiring requirements. The Firm also supports Affirmative Action philosophies and works hard to provide disadvantaged groups with opportunities for self enhancement.

This proposal is a firm and irrevocable offer for 180 days.

We are confident that you will find our organization offers the required expertise, technical knowledge, and business understanding to perform an audit of the City. Our past experience provides us with a thorough understanding of the needs and requirements of the City, as well as the technical knowledge to perform such services in accordance with the accounting and auditing guidelines as published by the various authoritative entities.

We welcome your inquiries and look forward to further discussions with you.

Sincerely,
Ahmed Badawi
Partner
Badawi & Associates
Certified Public Accountants
Attachment A Agenda Report Page 8
City of Piedmont Technical Proposal
3 Independence
The Firm is independent of the City of Piedmont as defined by the GAO’s Standards for Audit of Governmental Organizations, Programs, Activities and Functions, and the AICPA and California State Society of Certified Public Accountants as promulgated in various auditing and professional standards.

Insurance
The Firm maintains professional liability insurance and other coverage as part of our comprehensive insurance policy. Upon selection as the City’s independent auditor, the Firm and our insurance provider will provide a certificate of insurance to the City which shows the minimum requirements identified by City have been met.

License to Practice in California
The Firm and all key professional staff assigned to the City’s audit are properly licensed to practice as Certified Public Accountants in the State of California and comply with GAO Government Auditing Standards.

The Firm is registered with the California State Board of Accountancy. Its State number is COR6823.

The Firm has met all required State and local laws, rules, and regulations.

Conflict of Interest
The Firm has no conflicts of interest in connection with providing the services described in this proposal. The Firm does not have any financial, business, or other professional relationships with the City or any member of City staff.

Firm Qualifications
Badawi & Associates was founded by Mr. Ahmed Badawi. Mr. Badawi has over 25 years of experience working with state and local government with a special focus on cities. Prior to founding B&A, Mr. Badawi was a partner with several local and national firms, where he headed their government practice in Northern California. Mr. Badawi founded Badawi & Associates to serve the fast-paced needs of California's local governments. The goal is to build a proactive, client-focused culture from the ground up and to eliminate the entrenched bureaucratic culture and intrinsic limitations of the big audit firms.

Located in Berkeley, CA, the Firm serves a variety of cities and towns throughout California as well as conducting financial related services for numerous special districts and authorities.

Names and phone numbers of several of our current and past clients and other references are provided for your inquiries. We encourage you to contact these individuals to obtain information on the quality of the audit and the ability of the audit staff.

Our Berkeley office will be the Engagement Office assigned to the City.

In addition to specific City financial statements, the Firm members have also audited numerous redevelopment agencies, public financing authorities, hospitals, housing authorities, transportation authorities, special districts, water districts, OCJP grants, self-insurance pools, joint power authorities and has also performed numerous compliance audits in accordance with the Single Audit Act, childcare regulations, TOT regulations, AQMD regulations, franchise requirements.

The Engagement Partner assigned to the City will be Mr. Ahmed Badawi. Mr. Badawi has over 25 years of government audit experience. He is a member of various governmental committees, has actively participated in the development of accounting and audit guidelines for the governmental sector, and is an instructor for the California Society of Municipal Finance Officers.

Firm
Qualifications
and
Experience
Attachment A Agenda Report Page 9
City of Piedmont Technical Proposal
4 The professional staffs assigned to the Engagement are qualified and experienced. Each individual of the Engagement Team has several years of experience and has conducted or participated in numerous municipal audits of various sizes. Their understanding of governmental operations and the various authoritative guidelines will provide the where-with-all to perform the audit in an efficient and effective manner with minimal disruption to the City’s finance department.

Technical Approach
The approach to the audit has been designed to meet the audit requirements of the various authorities with the least disruption to the City’s operations. The foundation of the audit approach is based on communication coupled with a strong knowledge of City operations and detailed planning at the initial stages of the audit. Open communication lines with all parties of the Engagement Team and City Management and staff throughout the engagement eliminate “surprises”. Initial planning and proper assignment of duties to experienced personnel provide for an effective and efficient audit process. Consequently, inefficiencies, disruptions, and lack of understanding are kept to a minimum.

The audit approach will consist of four phases:
1) Initial Planning Meeting:

The Engagement Partner and Manager will meet with City Management to discuss the audit approach, identify specific needs of City Management, and familiarize themselves with City policies and practices.
2) Interim:

The Engagement Team members including the Engagement Team Partner will perform the internal control reviews, test transactions, evaluate compliance with Single Audit Act requirements, identify potential audit issues that need to be addressed, perform limited confirmation procedures, and develop a clear understanding between the Engagement Team and City Management of the year-end audit responsibilities and assignments. In addition, we strive to complete many of the year-end audit tasks during the interim phase to ensure a smoother audit process. We will work with the City on providing a list of those tasks that we will target to complete during interim and work with the City on how to complete them to minimize the amount of effort and time needed at yearend which in turn will assist the City in meeting its goal of issuing the Annual Financial Report.
3) Year-end:

The Engagement Team members including the Engagement Team Partner will conduct validation procedures on general ledger account balances, complete confirmation procedures, perform analytical procedures on revenue and expenditures, perform search for unrecorded liabilities, complete compliance work on Federal Assistance, and wrap up audit field work.
4) Reporting:

Auditor’s reports for all City reporting entities and compliance requirements will be finalized along with Single Audit Reports and Management Letter comments. The Partner and Manager will be available to make presentations to the City Council and/or designated bodies.

Attachment A Agenda Report Page 10
City of Piedmont Technical Proposal
5 Firm Experience
The Firm is located in Berkeley and provides a full range of accounting services to governmental agencies throughout California, including audit, tax and accounting. The Firm’s professional staff members provide the financial background and specific experience to meet the City’s operational needs. Additionally, this situation provides the City with an auditing firm that has depth in capabilities to address any financial issue the City may need assistance with, and the quality audit approach that you expect.

Our Berkeley office will be the Engagement Office assigned to the City.

Firm policy requires that the Engagement Partner, during the first year of the engagement, be actively involved in the daily fieldwork. This means to the City that Mr. Badawi will actually be on-site during the audit coordinating the audit process, supervising the audit staff, gaining a hands-on understanding of City processes, and benefiting the City with his broad municipal experience. We have found that this effort benefits the City and the Firm through developing a thorough knowledge of the City’s practices and issues and establishing a close working relationship with the City’s Management. Additionally, continuity of audit personnel is assured because of the hands on involvement of the Partner.

We are committed to providing appropriate and related experience, personal involvement, and a broad business perspective to produce a quality end product within the time frames required.

The Firm provides financial and compliance auditing services to governmental agencies throughout California. We are a governmental agency auditing firm and our professional staff members have been performing these services for many years. As a result, we have performed financial and compliance audits on most, if not all, types of governmental agencies and operations including:
• Cities
• Redevelopment
Agencies
• Financing
Authorities
• Housing Authorities
• Special Districts
• Water Districts
• Waste Management
Authorities and
Operations
• Pension Plans
• Child Care
Operations
• Joint Power
Authorities
• Investment Activities
• Landfills
• Enterprise Funds
• Airports
• Transportation
Operations
• Federal and State
Grants
Additional Activities
We offer a full range of accounting and finance services to the governmental sector. These services include:
• Financial audits
• Compliance audits
• Tax advice
• Development of financial and
accounting policies and procedures
• Investment review and compliance
evaluation
• Operational reviews
• Technical guidance on existing and
upcoming accounting issues
• Training seminars
• Pension/profit-sharing plans
• Performance audits
• Business consulting
Consequently, Firm personnel are well qualified to perform the services expected by the City.

Attachment A Agenda Report Page 11
City of Piedmont Technical Proposal
6 Client Training Seminar
The Firm hosts an annual update on recent technical accounting and finance issues affecting the governmental area. This all day session reviews new and anticipated pronouncements from GASB, discusses future issues under consideration by GASB, reviews accounting treatment of various transactions where issues may arise, and provides a general overview of state and federal compliance issues. All of our clients are invited to attend, free of charge. The one day session qualifies for CPE under the rules of the State Board of Accountancy and is held in the Bay Area.

GASB 68 Firm Developed Tools and Assistance
The Firm has developed tools to assist our clients with preparation of GASB 68 journal entries for the CalPERS’ Cost Sharing Plans (for which individualized actuarial valuations are no longer prepared) and the CalPERS’ Agent Multiple Employer Plans. In addition to providing our clients with these tools and instructions on how to use them, we are available to answer any questions on how to prepare and complete the GASB 68 journal entries.

Flowcharting Documentation
As part of our risk assessment procedures, we prepare flowcharts for documenting our understanding of the City’s significant accounting and financial processes. Flowcharts are updated annually for any changes in the City’s processes and copies can be provided upon request for the City’s internal use. Flowcharted processes may include:
• Financial Reporting, Closing, and Manual Journal Entries • Cash Receipts, Billing, and Accounts Receivable/Revenues • Cash Disbursements, Purchasing, and Accounts Payable/Expenditures • Payroll and Human Resources
Quality Control Review
According to Government Auditing Standards, firms who perform audits under the Yellow Book are required to have a peer review once every three years. We received a report with a rating of pass with no deficiencies which we attached for your review.

Attachment A Agenda Report Page 12
City of Piedmont Technical Proposal
7 Attachment A Agenda Report Page 13
City of Piedmont Technical Proposal
8 Attachment A Agenda Report Page 14
City of Piedmont Technical Proposal
9 The Firm has policies and procedures to ensure it hires only qualified people, that it properly supervises them and provides professional training, that it advances them to responsibilities they are capable of handling, and that it provides them with necessary technical resources. All members of the Firm are very familiar with the stringent quality control standards established by the AICPA.

The Firm is a member of the AICPA Government Audit Quality Center.

The Firm is a member of the AICPA Private Companies Practice Section.

Federal or State Desk Reviews
The Firm has had no negative federal or state reviews in the past three (3) years.

Disciplinary Action
There has not been any state or federal disciplinary actions taken or pending against the Firm nor any findings to report.

Litigations
The Firm has not experienced any lawsuits or legal actions that have been resolved or are currently pending in the prior five years.

Attachment A Agenda Report Page 15
City of Piedmont Technical Proposal
10 The Engagement Team will normally consist of seven individuals who provide a broad business perspective and significant experience in governmental auditing. This team will provide access to a wide range of technical capabilities which will provide the City with not only the technical support necessary to perform the audit, but also the broad business background to interpret findings and observations to offer effective solutions to issues, and the personal involvement of the Engagement and Compliance Partners of the Firm.

The Engagement Team will be led by Ahmed Badawi, CPA. Mr. Badawi’s background includes over twenty-five years of municipal auditing experience with a special focus on cities. He is the instructor of the CSMFO “Introduction to Governmental Accounting” training classes. Mr.

Badawi is a member of the Government Accounting and Auditing Committee of the California Society of Certified Public Accountants. He has participated in the audits of numerous City, county and special district governments, as well as non-profit entities. His diversified background offers the technical qualities required of the governmental and non-profit areas and the necessary wherewithal to properly evaluate the entire accounting process, develop opportunities to improve the accounting process, and to offer practical business recommendations.

The second member of the Engagement Team will be Wenwei Zhao, CPA. Ms. Zhao’s background includes eight years of accounting and auditing experience. She has participated in the audits of numerous governmental entities and assisted in their efforts to publish their financial statements in compliance with various regulations, and is a volunteer member of the GFOA Special Review Committee. Ms. Zhao will be the Audit Manager of this engagement.

The third member of the Engagement Team will be Samantha “Samo” Michel. CPA. Ms.

Michel’s background includes six years of accounting and auditing experience. She has participated in the audits of numerous governmental entities and assisted in their efforts to publish their financial statements in compliance with various regulations. Ms. Michel will be the Audit Senior of this engagement.

Engagement Partner
Ahmed Badawi
CPA
Audit Manager
Wenwei Zhao
CPA
Engagement Quality
Reviewer
Mitesh Desai
CPA
Audit Senior
Samantha “Samo”
Michel, CPA
Professional
Audit Staff
Professional
Audit Staff
IT Specialist
Omar Rahman,

CPA, CISA
Partner,
Supervisory,
and Staff
Qualifications
and
Experiences
Attachment A Agenda Report Page 16
City of Piedmont Technical Proposal
11 The fourth member of the Engagement Team will be Omar Rahman, CPA, CISA. Mr. Rahman has over 10 years of experience in the field of Information Technology (IT) audit and risk management at the senior and executive management level. He has worked extensively with government agencies, private organizations, and public companies, providing external and internal audit services in support of financial statement audits. Mr. Rahman will serve as the I.T.

Specialist of this engagement.

The fifth member of the Engagement Team will be Mitesh Desai, CPA. Mr. Desai’s background includes seventeen years of experience in municipal auditing. Mr. Desai has participated in the audits of numerous governmental agencies, assisted in their efforts to publish their Annual Comprehensive Financial Reports in compliance with GASB 34, and a volunteer member of the GFOA Special Review Committee. Mr. Desai is responsible for conducting in-house trainings for staff auditors and is credentialed with the Advanced Single Audit Certificate offered by the AICPA. He will serve as the Engagement Quality Reviewer.

Each member of the Engagement Team participates in continuing education programs offered by the AICPA and California State Society of Certified Public Accountants, and each has met the continuing education requirements for municipalities. In addition, the firm offers at least 60 hours of in-house CPE annually focused mainly on municipal audits.

Professional Development:

The Firm maintains a comprehensive training program targeted at appropriate professional staff levels. It utilizes in-house developed educational programs, AICPA and California CPA Foundation educational programs, and on-the-job training.

The Firm’s annual training schedule which officially begins in April for all professional staff and administrative staff includes comprehensive in-house training sessions on such topics as:
• Review of principles of accounting and financial reporting for state and local governments • Review of governmental fund types and account groups
• Review of newly issued generally accepted auditing standards and GAO auditing standards
• Review of Internal Control evaluation approaches including COSO principles • Updates on recent governmental accounting and reporting guidelines • Review of Single Audit requirements and approaches
• Review of financial audit approaches
• Overview of audit and internal control work paper techniques • Review of GASB reporting requirements
• Review of current issues facing the governmental community During the year, professional staff members are sent to various educational sessions sponsored by the AICPA and California State Society of CPAs, as considered appropriate for the level and need of the individual. These classes include, among others:
• Governmental Financial Reporting Standards and Practices • Yellow Book: Government Auditing Standards
• Financial Accounting Standards: Comprehensive Review
• Single Audit
• Governmental Auditing & Accounting Update
• Governmental Accounting Principles
• Comprehensive Review of Generally Accepted Auditing Standards The result of the Firm’s training program is the production of a highly educated and competent municipal audit group capable of performing an efficient and effective audit for the City.

The Engagement Team members will continue their professional development efforts.

Attachment A Agenda Report Page 17
City of Piedmont Technical Proposal
12 Staff Retention and Continuity:

The Firm's policy on providing service to our clients includes a commitment to maintaining continuity of audit personnel. We cannot guarantee that our staff will remain with the Firm.

However, to encourage our staff to remain with us, we pay competitive wage rates; offer promotional opportunities; provide state-of-the-art equipment and excellent working conditions; and offer various benefits, such as retirement plans, medical plans, profit sharing programs, educational benefits, and other such benefits. We can also guarantee that the partner will be involved in future years. Continuity of audit staff is of prime concern to us and because of the hands-on involvement of the partner; we can assure you that future years’ audits will be conducted in an efficient and effective manner with qualified and experienced professionals.

The Firm is an Equal Opportunity employer and complies with all Federal and State hiring requirements. The Firm also supports Affirmative Action philosophies and works hard to provide disadvantaged groups with opportunities for self enhancement.

Resumes of each member of the Engagement Team follow.

Attachment A Agenda Report Page 18
City of Piedmont Technical Proposal
13 Ahmed Badawi, Certified Public Accountant – Engagement Partner Length of Career
• Over twenty-five years of experience in municipal auditing and accounting with a special focus on cities
• Certified Public Accountant for the State of California Professional Experience
• Partial listing of clients served:
• Has performed numerous financial audits, Single Audits, Transportation Development Act audits, housing audits, electrical utility audits, RDA audits, PFA audits, and Trust Fund audits, and has prepared numerous Annual Comprehensive Financial Reports Education
• BS Degree in Accounting from the University of Alexandria, Egypt Professional Activities
• Instructor, CSMFO’s “Introduction to Governmental Accounting” training class • Member, CALCPA Government Accounting and Auditing Committee • Member, American Institute of Certified Public Accountants • Member, California Society of Certified Public Accountants • Member, Government Finance Officers Association
• Member, California Society of Municipal Finance Officers Continuing Education
• Has met the current CPE educational requirements to perform audits on governmental agencies Financial Single RDA PFA Enterprise
Audit Audit Audit Audit Fund Other
Cities:

Antioch X X X X X
Atwater X X X X
Azusa X X X X
Berkeley X X X X X
Buena Park X X X X X
Burlingame X X X
Chino X X X X X
Cotati X X X
Dublin X X X
East Palo Alto X X X X
Folsom X X X X
Foster City X X X X X
Glendora X X X X X
Guadalupe X X X X X
Lafayette X X X X
Larkspur X X X X
Lindsay X X X
Menlo Park X X X X X
Newark X X X X
Oakdale X X X X X
Ontario X X X X X
Petaluma X X X
Pleasanton X X X X
Pomona X X X X X X
Richmond X X X X X X
San Bruno X X X X X
San Carlos X X X X X
San Leandro X X X X
San Luis Obispo X X X X
San Mateo X X X X X
Sausalito X X X X
Scotts Valley X X X X
Solvang X X
Union City X X X X X
Vacaville X X X X X
Walnut Creek X X X X X
Counties:

Santa Cruz County X X X X X X
Contra Costa County X X X X X X
Special Districts and Other:

Alameda County Water District X X X
East Bay Regional Park District X X X
Services Provided
Attachment A Agenda Report Page 19
City of Piedmont Technical Proposal
14 Wenwei Zhao, Certified Public Accountant – Professional Audit Manager Length of Career
• Eight years of experience in auditing
• Certified Public Accountant for the State of California Professional Experience
• Has performed numerous financial audits, Single Audits, RDA audits, PFA audits, Transportation Development Act audits, and housing audits
Education
• Master of Accounting from University of Pittsburgh, PA Professional Activities
• Volunteer Member, GFOA Special Review Committee
Continuing Education
• Various municipal accounting courses offered by the California Society of CPAs and local universities including:
- Governmental Financial Reporting Standards and Practices - Yellow Book: Government Auditing Standards
- Municipal Accounting
- Single Audit
• Has met the current CPE educational requirements to perform audits on governmental agencies Services Provided
Financial Single SCO RDA PFA Enterprise
Audit Audit Report Audit Audit Fund Other
Cities:

Barstow X
Berkeley X X X X
Crescent City X X X X
East Palo Alto X X
El Cerrito X X X
Folsom X X X X
Lafayette X X X X X
Larkspur X
Menlo Park X X X
Millbrae X
Newark X X X X
Oakdale X X X
Pomona X X X X X X
Redwood City X
Richmond X X X X X X X
San Luis Obispo X X X
San Mateo X X
Susanville X X
Town of Los Gatos X
Town of Yountville X X
Union City X X X X
Waterford X
Yuba City X X X X
Towns:

Los Gatos X
Child Care Programs:

Contra Costa County Child Care X X
Special Districts:

San Gabriel Valley Council of Governments X X
Cosumnes Services District X
Elk Grove Water District X
Hayward Area Recreation and Park District X
Marin Municipal Water District X
Resource Conservation District of Santa Cruz
County X
San Mateo County Mosquito and Vector Control
District X
Santa Cruz Regional 9-1-1 X
Attachment A Agenda Report Page 20
City of Piedmont Technical Proposal
15 Samantha “Samo” Michel, Certified Public Accountant – Professional Assurance Senior Length of Career
• Six years of experience in municipal auditing
• Three seasons of experience in personal tax preparation • Certified Public Accountant for the State of California Professional Experience
• Has participated in several financial audits, Single Audits, RDA audits, PFA audits, Transportation Development audits, and housing audits
Education
• BS, University of Washington, Seattle, WA
• Accounting, Foothill College, Los Altos Hills, CA
Professional Activities
• Member, California Society of Certified Public Accountants • Member, Forensic Services Section, California Society of Certified Public Accountants Continuing Education
• Various municipal accounting courses offered by the California Society of CPAs and local universities including:
- Governmental Financial Reporting Standards and Practices - Yellow Book: Government Auditing Standards
- Municipal Accounting
- Single Audit
• Has met the current CPE educational requirements to perform audits on governmental agencies Services Provided
Financial Single SCO TDA RDA Enterprise
Audit Audit Report Audit Audit Fund Other
Cities/Towns:

Antioch X X X X
Barstow X
Berkeley X X X
Buena Park X
Crescent City X X X
East Palo Alto X X
El Cerrito X
Folsom X X X
Guadalupe X X X
Los Gatos X X X
Millbrae X X
Menlo Park X X
Pismo Beach X X X
San Luis Obispo X X X X
San Mateo X X X X
San Bruno X X
San Carlos X X X X X
Sausalito X X X
Union City X
Vacaville X X
Waterford X
Yuba City X
Counties:

Contra Costa County X
Special Districts and Other:

Hayward Area Recreation District X X
Amador County Transporation Commission X X
Amador Transit X X
Central County Fire District X
Elk Grove Water District X
Port of San Luis Harbor X
San Mateo Consolidated Fire District X
StopWaste X X
Attachment A Agenda Report Page 21
City of Piedmont Technical Proposal
16 Omar Rahman, Certified Public Accountant, Certified Information System Auditor – Information Technology Specialist
Length of Career
• Over ten years of experience auditing information technology (IT) processes and controls • Certified Public Accountant for the State of California • Certified Information System Auditor
Areas of Expertise
• IT risk consulting and audit services for governmental entities, private/public companies, nonprofits, and professional service organizations
• External and internal IT audit services in support of financial statement audits • Technical guidance/support on IT risks and controls in relation to SOX 404a and SOX 404b compliance, NIST 800-53/171a, Cyber Security Framework, HIPAA Technical Safeguards, CCPA/GDPR compliance, COBIT 2019 Framework
• Managed entire life cycle of IT internal and external audit engagements from planning research, audit program development, fieldwork and reporting
• Assess risks related to IT processes/assets and corresponding applications/tools • IT control testing over business automated controls, general IT controls, and cyber security controls as well as IT substantive testing over information systems.

Presentations
• November 2017 - Institute of Internal Auditors - General IT Controls for Internal Audit • December 2018 - Institute of Internal Auditors - SDLC Process and Audit/Risk Considerations • February 2019 - IT Audit for Business Process Professionals • May 2019 - IT Internal Audit Emerging Technologies: Data Analytics • September 2019 - Information Systems Audit and Control Association Education
• B.S. Degree in Economics, University of California, Los Angeles, CA.

Professional Activities
• Certified Public Accountant - California
• Certified Public Accountant - Ohio
• Certified Information System Auditor
Attachment A Agenda Report Page 22
City of Piedmont Technical Proposal
17 Mitesh Desai, Certified Public Accountant – Engagement Quality Reviewer Length of Career
• Seventeen years of experience in municipal auditing with a special focus on cities • Certified Public Accountant for the State of California Professional Experience
• Has performed numerous financial audits, Single Audits, RDA audits, PFA audits, Transportation Development Act audits, and housing audits
Education
• BS Degree in Business Economics with an emphasis in Accounting from University of California, Santa Barbara
Professional Activities
• Member, American Institute of Certified Public Accountants • Member, California Society of Certified Public Accountants • Volunteer Member, GFOA Special Review Committee
Continuing Education
• Various municipal accounting courses offered by the California Society of CPAs and local universities including:
- Governmental Financial Reporting Standards and Practices - Yellow Book: Government Auditing Standards
- Municipal Accounting
- Single Audit
• Has met the current CPE educational requirements to perform audits on governmental agencies Services Provided
Financial
Audit
Single
Audit
RDA
Audit
PFA
Audit
Enterprise
Fund Other
Cities/Towns:

Albany x
Berkeley x x x x x
Dublin x x x
Fremont x x x x x
Newark x x x x
Union City x x x x x
Antioch x x x x x x
El Cerrito x x x x
Pittsburg x x x x x
Crescent City x x x x x
East Palo Alto x x x x
Foster City x x x x x
Menlo Park x x x x x
Millbrae x x x x x
Oakdale x x x x x
Placerville x x x x
Rio Vista x x x x
San Mateo x x x x x
Sebastopol x x x x
Susanville x
Turlock x x x
Vacaville x x x x x
Waterford x x x x
Yountville x x x
Yuba City x x x x x
Child Care Programs:

Menlo Park Child Care x x
Counties:

Contra Costa x x x x x
Santa Cruz x x x x x
Special Districts and Other:

Marin Municipal Water District x
West County Wastewater District x x
Attachment A Agenda Report Page 23
City of Piedmont Technical Proposal
18 The tables below and on the following page are a partial listing of our clients similar to the City, and illustrates the many different types of components involved in each audit engagement that present very difficult and complex auditing and accounting challenges (in order of audit hours). ** Indicates cities with population over 50,000
** Indicates cities with governmental revenues over $100 million and population over 50,000 City Client Since Hours Engagement Partner Principal Contact
Annual Comprehensive
Financial Report
GFOA Award
RDA/Successor Agency
Single Audit
TDA
Water Fund
Sewer Fund
SCO Report
Housing Authority
Enterprise Funds
Pension Trust Fund
** Richmond 2020 3,160 Ahmed
Badaw i
Andrea Miller
Finance Director
(510) 412-2077
[email protected]

X X X X X X X X X
** Berkeley 2008 1,505 Mitesh
Desai
Henry Oyekanmi
Finance Director
(510) 981-7300
[email protected]

X X X X X X X X
** Ontario 2021 1,012 Ahmed
Badaw i
Doreen Nunes
Assistant Director of Finance
(909) 395-2000
[email protected]

X X X X X X X X X
San Carlos 2023 865 Ahmed
Badaw i
Rebecca Mendenhall
Administrative Services Director
(650) 802-4213
[email protected]

X X X X X X X X
* Union City 2006 850 Mitesh
Desai
Jackie Acosta
Finance Director
(510) 675-5345
[email protected]

X X X X X X X
** Folsom 2019 786 Ahmed
Badaw i
Stacey Tamagni
Finance Director
(916) 461-6712
[email protected]

X X X X X X X
** Pomona 2023 756 Ahmed
Badaw i
Andrew Mow bray
Finance Director/City Treasurer
(909) 620-2353
Andrew .mow [email protected]

X X X X X X X X
* Petaluma 2019 691 Ahmed
Badaw i
Corey Garberolio
Finance Director
(707) 778-4357
[email protected]

X X X X X X X X X
La Verne 2023 691 Ahmed
Badaw i
Christy Lopez
Finance Director
(909) 596-8752
[email protected]

X X X X X X
* San Luis
Obispo 2019 638 Ahmed Badaw i
Emily Jackson
Finance Director
(805) 781-7125
[email protected]

X X X X X X
Similar
Engagements
with Other
Governmental
Entities
Attachment A Agenda Report Page 24
City of Piedmont Technical Proposal
19 City
Client Since
Hours
Engagement Partner
Principal Contact
Annual Comprehensive
Financial Report
GFOA Award
RDA/Successor Agency
Single Audit
TDA
Water Fund
Sewer Fund
SCO Report
Housing Authority
Enterprise Funds
Pension Trust Fund
Chino 2023 621 Ahmed
Badaw i
Sue Suriati
Fiscal Services Manager
(909) 334-3347
[email protected]

X X X X X X
* Antioch 2005 586 Mitesh
Desai
Daw n Merchant
Finance Director
(925) 779-6135
[email protected]

X X X X X X X X
Lafayette 2020 586 Ahmed
Badaw i
Jennifer Wakeman
Assis. Administrative Services Director
(925) 299-3213
[email protected]

X X X X X
Sausalito 2023 559 Ahmed
Badaw i
Chad Hess
Finance Director
(415) 289-4150
[email protected]

X X X X
Dinuba 2023 556 Ahmed
Badaw i
Karina Solis
Administrative Services Director
(559) 591-5900
[email protected]

X X X X X X X X
** Dublin 2018 546 Ahmed
Badaw i
Jay Baksa
Finance Director
(925) 833-6648
[email protected]

X X X X X
Azusa 2017 540 Ahmed
Badaw i
Talika Johnson
Administrative Services Director
(626) 812-5202
[email protected]

X X X X X X X
Foster City 2023 540 Ahmed
Badaw i
Edmund Suen
Finance Director
(650) 286-3204
[email protected]

X X X X X X X
Millbrae 2015 524 Mitesh
Desai
Mike Sung
Finance Director
(650) 259-2433
[email protected]

X X X X X X X
Glendora 2022 487 Ahmed
Badaw i
Kyle Johnson
Finance Director
(626) 914-8245
[email protected]

X X X X X X X X
San Bruno 2022 486 Ahmed
Badaw i
Nick Pegueros
Chief Financial Officer
(650) 616-7054
[email protected]

X X X X X X X X
Healdsburg 2023 452 Ahmed
Badaw i
Katie Edgar
Finance Director
(707) 431-3184
[email protected]

X X X X X X
* Yuba City 2017 450 Mitesh
Desai
Spencer Morrison
Finance Director
(530) 822-4615
[email protected]

X X X X X X X X
Attachment A Agenda Report Page 25
City of Piedmont Technical Proposal
20 City
Client Since
Hours
Engagement Partner
Principal Contact
Annual Comprehensive
Financial Report
GFOA Award
RDA/Successor Agency
Single Audit
TDA
Water Fund
Sewer Fund
SCO Report
Housing Authority
Enterprise Funds
Pension Trust Fund
Wasco 2021 428 Ahmed
Badaw i
Isarel Perez-Hernandez
Finance Director
(661) 758-7230
isperez@cityofw asco.org

X X X X X X X
Larkspur 2019 382 Ahmed
Badaw i
Emilia Gabriele
Administrative Services Director
(415) 927-5016
[email protected]
X X X
Atw ater 2021 380 Ahmed
Badaw i
Anna Nicholas
Finance Director
(209) 357-6310
anicholas@@atw ater.org

X X X X X X
Lemon Grove 2022 377 Ahmed
Badaw i
Joseph Ware
Finance Director
(619) 825-3803
Jw [email protected]

X X X X
Waterford 2018 311 Mitesh
Desai
Tina Envia
Finance Manager
(209) 874-2328 Ext: 104
tenvia@cityofw aterford.org

X X X X
Solvang 2019 308 Ahmed
Badaw i
Wendy Berry
Administrative Services Director
(805) 688-5575 x 205
w [email protected]

X X X X X
Oakdale 2016 306 Mitesh
Desai
Albert Avila
Finance Director
(209) 845-3584
[email protected]

X X X X X X
Guadalupe 2017 303 Mitesh
Desai
Janice Davis
Finance Director
(805) 356-3895
[email protected]

X X X X X
Sebastopol 2017 275 Mitesh
Desai
Ana Kw ong
Finance Director
(707) 824-4879
akw [email protected]

X X X X X X X
Cotati 2020 265 Ahmed
Badaw i
Angela Courter
Director of Administrative Services
(707) 665-4236
[email protected]

X X X X X
Crescent City 2014 227 Mitesh
Desai
Linda Leaver
Finance Director
(707) 464-7483 x224
[email protected]

X X X X X X
Scotts Valley 2019 202 Ahmed
Badaw i
Stephanie Hill
Administrative Services Director
(831) 440-5614
[email protected]

X X X X X
Attachment A Agenda Report Page 26
City of Piedmont Technical Proposal
21 The table below lists all special district engagements (in order of audit hours):

Special District
Client Since
Hours
Engagement
Partner
Principal Contact
Annual Comprehensive
Financial Report
GFOA Award
Single Audit
Enterprise Funds
San Gabriel Valley
Council of Governments 2021 618 Ahmed Badawi
Rey Alimoren
Director of Finance
(626) 962-9292
[email protected]
No N/A X X
Sacramento
Metropolitan Fire District 2023 519 Ahmed
Badawi
Dave O'Toole
Chief Financial Officer
(916) 859-4300
[email protected]
Yes Yes X
County of Contra Costa
Community Services
Bureau Child
Development Program
2013 450 Mitesh
Desai
Donn Matsuzaki
Fiscal Officer
(925) 608-4832
[email protected]
No N/A
Union Sanitary District 2023 362 Ahmed
Badawi
Mark Carlson, CPA
CFO/Business Services Manager
(510) 477-7510
[email protected]
Yes Yes X
Florin Resource
Conservation District/
Elk Grove Water District
2015 350 Mitesh
Desai
Patrick Lee
Finance Manager / Treasurer
(916) 685-3556
[email protected]
Yes Yes X
Hayward Area
Recreation
and Park District
2017 350 Mitesh
Desai
Anne Maze
Administrative Services Director
(510) 881-6707
[email protected]
No N/A X
San Ramon Valley Fire
Protection District 2021 285 Ahmed
Badawi
Ms. Davina Hatfield
Chief Financial Officer
(925) 838-6668
[email protected]
Yes Yes X
Solano County Water
Agency 2020 243 Ahmed Badawi
Roland Sanford
General Manager
(707) 455-1103
[email protected]
No Yes
San Mateo Mosquito and
Vector Control District 2018 228 Ahmed Badawi
Richard Arrow
Finance Director
(650) 344-8592
[email protected]
Yes Yes
Monterey Bay Unified Air
Pollution Control District 2016 200 Mitesh Desai
Rosa Rosales
Administrative Services Manager
(831) 718-8019
[email protected]
No N/A
Ross Valley Fire
Department 2021 190 Ahmed Badawi
Jeff Zuba
Finance & Admin. Services Director
(262) 989-2208
[email protected]
No N/A
Southern Marin Fire
Protection District 2020 160 Ahmed Badawi
Alyssa Schiffmann
Finance Manager
(415) 388-8182
[email protected]
No N/A
Alameda County Waste
Management Authority
(StopWaste)
2018 154 Mitesh
Desai
Jennifer Luong
Finance Services Manager
(510) 891-6500
[email protected]
Yes Yes
Attachment A Agenda Report Page 27
City of Piedmont Technical Proposal
22 Special District
Client Since
Hours
Engagement
Partner
Principal Contact
Annual Comprehensive
Financial Report
GFOA Award
Single Audit
Enterprise Funds
Central County Fire
Department 2012 150 Mitesh
Desai
Jan Cooke
Finance Director
(650) 375-7408
[email protected]
Yes Yes
Central Fire Protection
District of
Santa Cruz County
2018 150 Mitesh
Desai
Nancy Dannhauser
Finance Director
(831) 479-6842
[email protected]
No N/A
Port of San Luis
Harbor District 2017 150 Mitesh Desai
Suzy Watkins
Harbor Director
(805)595-5414
[email protected]
Yes Yes X
Resource Conservation
District of Santa Cruz
County
2017 150 Mitesh
Desai
Arianne Rettinger
Director of Finance
(831) 594-8109
[email protected]
No N/A X
Santa Cruz
Regional 9 - 1 - 1 2016 150 Mitesh Desai
Amethyst Uchida
General Manager
(831) 471-1035
[email protected]
No N/A
Marin Wildfire Prevention
Authority 2021 106 Ahmed
Badawi
Alyssa Schiffmann
Finance Manager, SMFPD
(415) 952-5859
[email protected]
No N/A
Attachment A Agenda Report Page 28
City of Piedmont Technical Proposal
23 The City desires an audit of the financial records for the City and an expression of an opinion in accordance with generally accepted accounting principles on the fairness of presentation of financial statements for the fiscal years ending June 30, 2024 through 2026, with the option of extending the contract for each of the two (2) subsequent fiscal years.

The Firm will:
• Express an opinion on the fair presentation of its basic financial statements which includes but is not limited to the financial statements of governmental activities, the business-type activities, each major fund and all aggregate remaining fund information in conformity with generally accepted accounting principles in the United States of America. • Express an "in-relation-to" opinion on the fair presentation of its combining and individual non-major and fiduciary fund financial statements and schedules in conformity with generally accepted accounting principles. The Firm will provide an “in-relation-to” report on the supporting schedules contained in the Annual Financial Report based on the auditing procedures applied during the audit of the basic financial statements and schedules.
• Provide an “in-relation-to” report on the schedule of expenditures of federal awards based on the auditing procedures applied during the audit of the financial statements. • Perform the audit in accordance with generally accepted auditing standards accepted in the United States of America, applicable to the financial audit contained in the Government Auditing Standards issued by the Comptroller General of the United States and the provisions of the Uniform Guidance, Audits of States, Local Governments and Non-Profit Organizations.
• Perform limited procedures on supplementary information required by the Government Accounting Standards Board.
• Issue the following reports, following the completion of the audit of the fiscal year’s financial statements:
 Independent Auditor’s Report on Financial Statements and Schedule of Expenditure of Federal Awards
 Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards
 Independent Auditor’s Report on Compliance with Requirements Applicable to Each Major Program and Internal Control over Compliance in Accordance with the Uniform Guidance (if required)
 Schedule of Findings and Questioned Costs (if required)  Auditor’s Communication with Those Charged with Governance  Annual Financial Report following the requirements and guidelines of the GFOA award program
 Gann Limit Agreed-upon Procedures
 State Controller’s Report
 Measure BB
 Measure F
 Parking Citation Agreed Upon Procedures
 Transportation Development Act (TDA)
• Provide special assistance to the City as needed.
• Retain all working papers and reports at the audit firm’s expense for a minimum of 7 years.

In addition, make working papers available to the City and/or any government agency as appropriate.

Should any conditions be discovered requiring corrective action, the Firm will provide a detailed description of the findings and recommended actions as to their resolution.

Understanding
of Services to
be Provided
Attachment A Agenda Report Page 29
City of Piedmont Technical Proposal
24 The Firm will submit a report to the City’s Council and management detailing auditor’s responsibility under generally accepted auditing standards, significant accounting policies, management judgments and accounting statements, significant audit adjustments, other information in documents containing audited financial statements, disagreements with management, management consultations with other accountants, major issues discussed with management prior to retention, difficulties encountered during the audit, and any significant deficiencies or material weaknesses found during the audit. Non-material instances of noncompliance will be reported in a separate management letter, if appropriate, along with any other observations or recommendations determined to be informative to City Management.

The Firm will be available to provide advice and counsel regarding significant matters during the year.

The Firm’s Partner and Staff welcome the opportunity to make presentations to the City Council and will be ready to respond to questions from the Council and citizens of the City.

Objectives of Our Services
The basic objective of our audit of the City is to conduct an examination of the financial statements in accordance with generally accepted auditing standards and to express our opinion on the fairness of presentation of such financial statements in conformity with generally accepted accounting principles.

Additionally, we believe that another real value of our audit lies in meeting other objectives at no additional cost. The following are other objectives of our services that have important benefits to the City:
• To offer substantive observations and recommendations relating to accounting and operating control policies and procedures.
• To identify opportunities for operating efficiencies and isolate candidate activities for cost reduction opportunities.
• To perform a professional audit in an efficient and effective way to minimize disruption to the office operations.
• To offer ongoing advisory services to assist in the running of the operation and implementation of improved operating procedures.

The engagement will be conducted within the framework of the Firm's quality control program which includes the use of audit programs, careful planning, use of computerized audit software and internal control evaluation and documentation software, and objective review procedures.

On-site staff will use Firm supplied portable computers and printers.

Audit Approach
The specific audit approach has been designed to efficiently and effectively address the audit requirements of the City, to perform the audit of the City’s financial records in a timely manner with minimal disruptions to office operations, and to meet the City’s timeline.

The audit will be conducted in accordance with:
1) Generally accepted auditing standards established by the AICPA. 2) The standards contained in Government Auditing Standards issued by the GAO. 3) Provisions of the Single Audit Act and the Uniform Guidance. 4) Requirements issued by the California State Controller’s office. 5) Other requirements as required.

Specific Audit
Approach
Attachment A Agenda Report Page 30
City of Piedmont Technical Proposal
25 We will conduct the necessary audit steps to perform:
• Planning of the engagement
• Evaluation of the existing internal control environment to determine degree of risk of material misstatement
• Determination of degree of compliance with laws, regulations, grant provisions, and City approved policies
• Assessment of potential fraudulent issues
• Validation of account balances
• Verification of reasonableness of management estimates Technical Approach
We use an industry specific audit approach tailored to governmental entities. Our governmental audit approach addresses the special risks and circumstances of local governments. As a result, the audit is conducted efficiently and effectively with minimal disruption to your staff.

The core of our governmental technical audit approach can be summarized as follows:

1. Planning, Understanding and Communication:

Based on our previous audit experience, using the budget, organizational charts, manuals and other financial information systems and our knowledge of how governments work, we will obtain an insight to the specific concerns and sensitivities of the City. Our understanding is updated continuously through our year-round contact and communication efforts. We will agree on common audit objectives and expectations with management before audit work begins and, throughout the audit, will meet regularly with management to discuss audit issues and to gather feedback.

2. In-Depth Review of Systems and Controls:

We have developed diagnostic reviews which enable us to evaluate your systems and controls, and to provide management with constructive feedback. Combined with our knowledge of the City and understanding and experience with the City’s accounting software, our control review will form the basis of our audit risk assessment. We will utilize the COSO approach in our evaluation of the City’s internal processes to identify potential control deficiencies. In future years, we will update our understanding through similar procedures.

3. Risk-Based Customized Testing Program:

Our audit approach is tailored to governmental applications. We will use audit programs specifically designed to address the operational environment of governmental entities. Our approach will identify potential control risks and the opportunities for risk of material misstatements and fraud. We will evaluate the various risk assessments and identify the potential risks relating to the:
• Balance Sheets / Statement of Net Position
• Statement of Revenues and Expenditures / Statement of Activities • Presentation
• Disclosure
Our audit procedures will then be developed to address these risk areas.

4. Expanded Interim Fieldwork:

Timeliness and audit efficiency is enhanced by performing extensive interim work. Partners, managers and senior staff work with City staff to identify and resolve potential audit issues early. Accordingly, the amount of audit work to perform at year end is minimized. Because our audit staff is familiar with the operations before year-end fieldwork begins, disruption of accounting staff is minimized.

Attachment A Agenda Report Page 31
City of Piedmont Technical Proposal
26 5. Smooth Transition:

Our testing program focuses on audit risks identified by our understanding of the City’s operations. We will work with the accounting staff to identify the most effective ways to address our objectives. Communication between the members of the audit engagement team and City staff will be fluid and continuous.

6. Sample Size and Sampling Techniques:

Our audit approach will include sampling activities. Population size and the level of assurance to be derived from a particular test will dictate the sample size. We use sampling in our audit approach to compliment skilled judgment and knowledge of the particular situation. Our sample size will range normally from 25 to 60 items.

7. Automated Systems:

We will evaluate controls over the IT functions to assess control risk. We intend to test controls for purposes of reliance. Our review procedures will evaluate controls over:
• Security Management
• Logical and Physical Access
• Configuration Management
• Segregation of Duties
• Contingency Planning
In addition, we will review controls over:
• Input, processing, output, master data
• Application interface
• Data management system interface
Our information Technology Specialists will evaluate the IT operating control environment.

8. Analytical Procedures:

We use analytical procedures in several aspects of our audit. Extensive knowledge and industry background are required for effective analytics, and our staff possesses the appropriate experience and knowledge for the City to benefit from these procedures.

9. Approach to be Taken in Determining Laws and Regulations Subject to Audit Test Work:

We continuously refer to specific regulations, compliance supplements, state guidelines and contracts currently in force. We perform the procedures required related to laws and regulations, using inquiries, observations and sampling techniques. Some of the laws and regulations that we believe may be applicable to the City are the requirements of the California Public Utilities Commission, Single Audit Act and other applicable laws and regulations, including the California Government Code, provisions of applicable Grant guidelines, California Constitution Gann Limit requirements, requirements of local measures, Child Care Program compliance requirements, etc.

10. Report Format:

We will meet with City Management to review report formats. Any report format changes will be made in conjunction with approval from City Management.

11. Work Plans:

The detailed work plans will be designed to efficiently and effectively address the audit requirements of the City in accordance with generally accepted auditing standards, to perform the audit of the City’s financial records in a timely manner with minimal disruptions to office operations, and to meet the City’s timeline.

Attachment A Agenda Report Page 32
City of Piedmont Technical Proposal
27 12. Adjusting Journal Entries:

We will discuss and explain proposed audit adjusting entries with the City’s designated Finance Department personnel prior to recording. Audit adjusting entries will be provided in a format showing the lowest level of posting detail needed for data entry on the City’s general ledger system.

13. Listing of Schedules and Tables (anticipated to be prepared by the City):

Based on preliminary inquiries made with management and City staff and review of documents, we will tailor a list of schedules, tables, and other reconciliations required for the audit. We will take into account as much as possible reconciliations already prepared by the City for day to day operations and reporting, as well as any reports that are system generated to limit the need for additional City staff hours.

The following is a listing of some of the significant reconciliations and schedules that we would normally expect the City to provide to us in assisting us in conducting our fieldwork. • Trial Balance
• Annual Financial Report Account Roll
Up Schedules
• Budget to Actual Reports
• Bank Reconciliations
• Listing of manually prepared journal
entries posted
• Summary of Investments held by the
City
• Capital Asset Schedules
• Long Term Debt Schedules
• Debt amortization schedules &
Calculations of deferred amounts
• Calculations of any debt covenants
amounts or percentages
• Schedule of Leases
• Schedule of Expenditures of Federal
Awards
• Analysis of Deferred Inflows of
Resources and Deferred Outflows of
Resources
• Reconciliation of Receivables to
subsidiary ledgers
• Calculations for estimate of allowance
for uncollectible accounts
• Loans Receivable Schedules
• Reconciliation of Significant Revenue
Accounts
• Utility billing Registers and Fee
schedules
• Compensated Absences Schedules
and Copies of Related Policies
• Claims Payable Schedules
• Pension and OPEB Roll Forward &
Supporting Schedules
• GASB 54 Fund Balance Roll Forward
Schedule
• Interfund Transaction Schedules
Attachment A Agenda Report Page 33
City of Piedmont Technical Proposal
28 The Firm maintains a variety of specialized software packages during the audit that enable us to perform an efficient, thorough, and timely audit and keeping time demands on City staff to a minimum.

Trial Balance Management and Financial Statement Preparation ProSystem Fx Engagement allows us to import and manage multiple years of trial balance data including budgetary information, create multiple account groupings, generate reports, post journal entries proposed during the audit (including GASB 34 conversion entries), and link information directly to the financial statements. This gives us the ability to:
 Generate immediate trend and other comparative analysis of trial balance and budget data prior to the start of the audit. This allows us to identify potential issues and make inquiries early in the audit
 Link the financial statements and footnotes prior to the start of the audit allowing us to have majority of the financial statements (including budgetary comparison schedules and other supplementary information) prepared at the time the trial balance is uploaded  Audit adjustments or City adjustments provided during the audit are automatically reflected in the financial statements
Audit Request Management and Document Exchange
CCH Engagement Organizer (“Organizer”) is a virtual “Prepared by Client (PBC) List” that streamlines the process of requesting, receiving, and keeping track of documents. The Organizer is an integrated cloud-based request list that helps to facilitate the engagement through more seamless collaboration between the Firm and our clients. By utilizing the Organizer, the City can do all of the following in one secure virtual environment:
 Attach files of any type to document requests
 Easily track the status of document requests that are either pending, completed by the City, accepted by us, or rejected by us
 Access templates and documents from us that require completion  Have multiple City staff get involved and assist in the audit process  Participate in a dialog with us for questions and notes We have found that the use of the Organizer has helped our clients be always informed as to the status of their audit, and not be surprised with new requests or follow up on outstanding requests previously provided.

Computer Aided Audit Tools (CAATs)
The Firm’s data analytics software enables our Engagement Team to perform more than 150 Computer Aided Audit Tools (or “CAATs”). CCH Teammate Analytics gives us the ability to perform advanced data analysis and increase efficiency. By utilizing this software, we can:
 Immediately visualize and analyze 100% of account populations with graphs, charts and statistics to identify anomalies
 Make fewer sample selections that are targeted to problematic areas  Quickly analyze transactional data for:
o Duplicate records
o Missing transactions
o Transaction sequence
o Unusual items
 Compare excel worksheets for changes or differences
 Generate immediate testing samples
 Perform regression analysis
 Filter and extract data from City reports
Use of
Technology in
the Audit
Attachment A Agenda Report Page 34
City of Piedmont Technical Proposal
29 Audit Planning, Risk Assessment, and Audit Programs
Our firm utilizes CCH Knowledge Coach, which is an expert system that adapts and customizes our audit approach specifically based on the City’s structure, operating environment, specific transactions, and identified risks or matters to be addressed in the audit. The software is frequently updated for new industry trends and audit requirements. Included in the software is a continuous diagnosis of audit forms that identifies missing information, procedures, or any conflicts that need to be addressed prior to issuance of the audit report. We have found that this audit tool greatly benefits our audit clients in the following ways:
 Removal of standardized audit steps and procedures that do not add value to the audit  Targeted audit procedures focusing on risks and accounts specific to the City’s operations
 Audit is always performed in accordance with audit standards especially the risk assessment standards
 Maximizing audit efficiency having less City staff time dedicated to gathering information or responding to inquiries by focusing on material issues  Automatic self-diagnostics ensure no audit steps are missed, guaranteeing a quality audit
Research Tools
We maintain multiple research software packages that are always kept up to date to ensure compliance with accounting and auditing standards, and are also a resources for us to provide guidance to our clients. In addition to accounting and audit literature, we have access to interactive disclosure checklists that include sample footnote disclosures and financial statements.

Attachment A Agenda Report Page 35
City of Piedmont Technical Proposal
30 2024
Period Audit Tasks
May - Planning and Administration
 Review and obtain copies of key work papers of prior audit firm.  The entrance conference shall be held with City staff. The purpose of this meeting will be to discuss prior audits and the interim work to be performed. This meeting will also be used to establish overall liaison for the audits and to make arrangements for work space and other needs
 Review and evaluate the City's accounting and financial reporting.

Prepare an overall memo of recommendations, potential issues, and suggestions for improvements
 Prepare overall memo to the City confirming audit procedures, timing, and assistance
 Prepare detailed audit work plan and audit programs, audit budget and staffing schedule, and list of schedules to be prepared by the City staff
 Send the Organizer to the City that will include all request items considered to be necessary for the audit
June - Internal Control Evaluation
 Meeting with City Manager and Department Heads of other departments with large operating budgets or which have significant federal grant expenditures
 Attending City Council meetings
 Meeting with off-site locations
 Meeting with key Finance Department personnel
 Obtain and document understanding of key internal control systems through walk-throughs, interviews of staff, and review of supporting documentation
o General ledger system
o Budgeting system
o Revenue, utility billing, accounts receivable, and cash collections
o Purchasing, expenditures, accounts payable, and cash
disbursements
o Payroll
o Federal Financial Assistance
o Other systems
 Identify control risks
 Evaluate IT control environment
 Perform testing of the internal control system and evaluate the effectiveness of the City’s systems. Select large dollar and random samples of transactions in key operating systems. Sample size to meet required level for determined degree of risk. Review supporting documentation of selected transactions, evaluate adequacy of support and approvals, and conclude on degree of adherence to accuracy and compliance with City policies  Conduct fraud assessment procedures
 Assess degree of risk for material misstatement
 Provide to the City’s management a memo concerning
management letter points and identify issues, if any
Audit
Schedule
Attachment A Agenda Report Page 36
City of Piedmont Technical Proposal
31 2024
Period Audit Tasks
June - Other Tasks
 Review minutes of City Council meetings and other key committees  Perform preliminary substantive procedures, which would include tests of:
o Vendor and contractor payments
o Payroll expense
o Utility billing
o Pension and OPEB testing
o Capital asset acquisitions
o Journal entries
o Retrospective review of accounting estimates
 Financial statement database management and other setup, in addition to drafting of all necessary report templates
 Preliminary Single Audit and other compliance testing  Coordinate with City staff and prepare of all appropriate confirmation requests including:
o Bank accounts
o Investment pool accounts
o Accounts receivable
o Federal grants
o Revenue from governmental agencies
o Bond and other debts
o Pension plan
o Attorney letters
o Others, as required
 Update the Organizer with any additional requests that will be needed for the City's audit
 Provide the City with audit plan and list of year-end audit schedules  Hold progress conference with City Management
 Hold exit conference with City Management
October -
November
- Final Fieldwork
 Entrance conference with City Management
 Follow-up on all outstanding confirmations
 Verify and validate account balances by reviewing supporting documentation including invoices, vouchers, council resolutions, minutes, and other documents, as required
 Perform analytical review of revenue and expenditures. Determine reason for material differences between budget and actual  Perform a search for unrecorded liabilities by reviewing disbursements subsequent to June 30, testing terms of contractual obligations, and interviewing City staff
 Perform review of subsequent events by discussions with City Management and update all minutes of City Council and key committees
Attachment A Agenda Report Page 37
City of Piedmont Technical Proposal
32 2024
Period Audit Tasks
- Single Audit Compliance (if required)
 Entrance conference with City Management
 Obtain Federal Financial Assistance Schedule
 Determine grants to be considered as major programs including clusters
 Perform audit tests of major grant programs and compliance with Federal Law and Regulations
 Review grant documents, select sufficient number of transactions to test for compliance of Federal Requirements
 Coordinate Single Audit efforts with the Financial Audit efforts  Communicate findings to City Management
 Other Compliance
December - Audit Reports
 Complete drafts of City’s Annual Financial Report
 Prepare draft of Single Audit Reports concerning internal control structure, compliance with laws and regulations, and administering of federal financial assistance programs
 Prepare other reports as required
 Provide revised final drafts of all required reports to the City for approval
January 2025 - Final City Audit Reports, Financial Statements, Single Audit Reports, and other reports delivered.
- Audit Presentation to Council (if requested)
February
2025
- State Controller’s Reports delivered and submitted
- Single Audit Report package submitted to Federal Audit Clearinghouse
Note: the proposed audit schedule above can be adjusted as necessary based on the needs of the City.

Estimated Hours by Audit Phase
Position Planning
Interim
Fieldwork
Year End
Fieldwork Reporting Total
Partner 7 18 10 6 41
Audit Manager 6 32 29 4 71
Audit Senior 2 46 36 5 89
Professional Audit Staff - 91 72 10 173
IT Specialist - 3 - 3 -
Administrative Assistant 5 9 - 9 23
Total 20 199 147 34 400
Attachment A Agenda Report Page 38
City of Piedmont Technical Proposal
33 Identification of Anticipated Potential Audit Problems We do not anticipate that there will be any audit problems at the City. However, the following are some areas that we will carefully investigate and monitor during our audit procedures:
• Financial Reporting:
 Review and evaluate that the City’s Annual Financial Report is in compliance with current reporting and disclosures requirements issued by the GASB and GFOA.  Review the Annual Financial Report for financial reporting conformance awards issued by CSMFO and GFOA.
 Review and evaluate degree of compliance with the various GASBs in effect.  Review degree of compliance with infrastructure obligations and regulatory provisions. • Internal Control Structure:
 Review and evaluate the City’s internal control functions and ascertain compliance with proper internal control philosophies.
 Review computer system processes and controls and evaluate adequacy of the control environment.

Several new GASB pronouncements will become effective over the time period of this proposal.

As such, specific attention will be provided to determine the proper implementation of these new pronouncements. A list of known new pronouncements with implementation dates that fall within this proposal period are as follows:
2024
• Statement 100 – Accounting Changes and Error Corrections—an amendment of GASB Statement No. 62
2025
• Statement 101 – Compensated Absences
• Statement 102 – Certain Risk Disclosures
Discussion of
Relevant
Accounting
Issues
Attachment A Agenda Report Page 39
City of Piedmont Technical Proposal
34 Schedule of Professional Fees
Note: The above is an all-inclusive maximum price, including services, out-of-pocket expenses, meals, lodging, transportation, printing, and other costs.

Optional
Year
Optional
Year
2023-24 2024-25 2025-26 2026-27 2027-28
Financial Statements Audit $ 40,125 $ 40,455 $41,255 $ 42,145 $ 42,840 Single Audit 2,890 3,150 3,330 3,530 3,750
Gann Limit Agreed-upon Procedures 865 945 1,000 1,060 1,130 State Controller’s Report 2,990 3,265 3,455 3,530 3,750 Measure BB 2,130 2,315 2,445 2,585 2,740
Measure F 2,130 2,315 2,445 2,585 2,740
Parking Citation Agreed Upon Procedures 1,705 1,865 1,975 2,095 2,230 Transportation Development Act (TDA) 2,130 2,315 2,445 2,585 2,740 Total $ 54,965 $ 56,625 $58,350 $ 60,115 $ 61,920
Description
Comprehensive
Cost Bid
Attachment A Agenda Report Page 40
City of Piedmont Technical Proposal
35 Manner of Payment:

Each Engagement Team member maintains detailed time sheets describing work performed, date of work, and amount of time spent on each task for the Engagement. The Firm will bill the City after completion of each phase of the audit and bill the City up to a maximum of 90%. The remaining 10% of the proposal amount will not be due until all final reports are delivered and accepted by the City. The City can anticipate three billings as follows:

Work Performed
% of Proposal
Amount
For interim work 45%
For year-end work 45%
At presentation and acceptance of final reports 10%
Total 100%
Rates for Additional Professional Services:

Any services outside the scope of our engagement will be promptly identified before the services are rendered. Upon mutual agreement, the out-of-scope services will be separately billed at our standard hourly rates. While it can be difficult to simply state hourly rates, as often times the needs of the client and the specific tasks directly impact the billing rates for our services, we want to provide the following information regarding our published billing rates:

Position Hourly Rate
Partner $ 300
EQR 300
Manager 225
Senior 175
Staff 125
I.T. 225
Admin. 100
Our Standard Hourly Rates are adjusted annually by 3% for Cost of Living and Inflation Adjustments
Attachment A Agenda Report Page 41
City of Piedmont Technical Proposal
36 A client relationship with the City will be of great value to our Firm and we welcome the opportunity to develop a long-term relationship with the City. We are committed to:
• Rendering the highest standard of service
• Developing a long-term working relationship dedicated to meeting the needs of the City • Assisting the City in operational issues
• Producing a quality end-product
We have the technical qualifications and experience to provide the level of service desired and expected by the City and stand ready to provide our knowledge and experience for the benefit of your organization.

We would like to express our appreciation to the City and to its Staff for allowing us the opportunity to submit a proposal to perform professional auditing services. We are available, at your convenience, to discuss any aspects of our proposal.

Thank you for allowing us to present our Firm to you.
* * * * * * * * * * * * * * * * *
Conclusion
Attachment A Agenda Report Page 42
City of Piedmont Technical Proposal
37 References
1) City of Berkeley
• Scope of Work: Annual Comprehensive Financial Report, Single Audit, SAS 114, Gann Limit, Measure B/BB/F (Alameda County), TDA Audit, RDA Successor Agency
• Engagement Partner: Ahmed Badawi (2008 – 2019), Mitesh Desai (2020 - Present) • Address: 2180 Milvia Street, Berkeley, CA 94704
• Principal Contact:

Mr. Henry Oyekanmi, Finance Director
(510) 981-7332
[email protected]
2) City of Richmond
• Scope of Work: Annual Financial Report, Single Audit, SAS 114, Gann Limit, Joint Powers Financing Authority, TDA, State Controller’s Reports • Engagement Partner: Ahmed Badawi (2020 - Present)
• Address: 450 Civic Center Plaza, Richmond, CA 94804
• Principal Contact:

Ms. Andrea Miller, Finance Director
(510) 412-2077
[email protected]
3) City of Lafayette
• Scope of Work: Annual Comprehensive Financial Report, Single Audit, SAS 114, Gann Limit, TDA, Lamorinda Fee and Finance Authority Report, Lamorinda School Bus Transportation Agency Report, State Controller’s Report • Engagement Partner: Ahmed Badawi (2020 – Present)
• Address: 3675 Mount Diablo Blvd., #210, Lafayette, CA 94549 • Principal Contact:

Ms. Jennifer Wakeman, Assistant Administrative Services Director (925) 299-3213
[email protected]
4) City of Dublin
• Scope of Work: Annual Comprehensive Financial Report, Single Audit, SAS 114, Gann Limit, Measure B/BB/F (Alameda County), TDA, State Controller’s Reports • Engagement Partner: Ahmed Badawi (2018 – 2022), Mitesh Desai (2023 - Present) • Address: 100 Civic Plaza, Dublin, CA 94568
• Principal Contact:

Mr. Jay Baksa, Finance Director
(925) 833-6648
[email protected]
5) City of Antioch
• Scope of Work: Annual Comprehensive Financial Report, Single Audit, SAS 114, Gann Limit, Antioch Public Financing Authority, Antioch Area Public Facilities Financing Agency
• Engagement Partner: Ahmed Badawi (2005 – 2019), Mitesh Desai (2020 - Present) • Address: Third and H Streets, Antioch, CA 94509
• Principal Contact:

Ms. Dawn Merchant, Finance Director
(925) 779-6135
[email protected]
Appendix
Attachment A Agenda Report Page 43
City of Piedmont Technical Proposal
38 Exceptions to the Contract
With regard to the sample contract, RFP Exhibit A, City of Piedmont Sample Contract, we would like to edit the paragraphs as follows:

7. Indemnity and Hold Harmless
To the fullest extent permitted by law, Independent Contractor shall defend (with legal counsel reasonably acceptable to City), indemnify and hold harmless City and its officers, elected officials, employees, agents, and volunteers (collectively “Indemnitees”) from and against any and all liability, claims, loss, cost, damage, injury (including, without limitation, injury to or death of an employee of Independent Contractor or its subconsultants), expense and liability of every kind, nature and description (including, without limitation, fines, penalties, incidental and consequential damages, reasonable court costs and attorneys fees, litigation expenses and fees of expert consultants or expert witnesses incurred in connection therewith, and costs of investigation) (“Liability”), except to the extent that such losses, liabilities, damages, or costs and expenses result directly from the gross negligence or willful misconduct of the City, where the same arise out of, are a consequence of, or are in any way attributable to, in whole or in part, the performance of this Contract by Independent Contractor or by any individual or entity for whom Independent Contractor is legally liable, including but not limited to, officers, agents, employees, subcontractors or consultants of Independent Contractor.

19. Ownership of Documents
Unless such property is proprietary in nature, all plans, studies, documents and other writings, including working notes and internal documents, prepared by and for Independent Contractor, its officers, employees and agents and subcontractors in the course of implementing this Agreement, shall become the property of City, upon payment to Independent Contractor for such work, and City shall have the sole right to use such materials in its discretion without further compensation to Independent Contractor or to any other party. Independent Contractor shall, at Independent Contractor’s expense, provide such reports, plans, studies, documents and other writings to City upon written request. All documents prepared by Independent Contractor are confidential and shall be maintained to preserve their confidential nature. Release of any such documents to third parties shall only be made upon written consent of City.

Attachment A Agenda Report Page 44

Exhibit A:

Contract
This Contract made __________ (“Effective Date”), between the City of Piedmont, California, a municipal corporation, 120 Vista Avenue, Piedmont, California 94611, ("City") and __________________, ("Independent Contractor").

1. City is a municipal corporation which needs certain services and software as more specifically set forth hereafter.

2. Independent Contractor agrees to provide these services and software to the City under the terms and conditions set forth in this Contract (“Contract”).

3. Services
The Independent Contractor will perform consulting services as described in the Independent Contractor's Response to RFP for Audit Services dated April 22, 2024 (the ''Proposal''), attached hereto and incorporated herein by reference as Exhibit A.

4. Compensation
City will pay the Independent Contractor per the “Schedule of Professional Fees” set forth in Exhibit A City shall issue payment per the Manner of Payment” section as set forth in Exhibit A. Payment will be made within 30 days of the satisfactory completion of the services described in Section 3 above.

5. Term
This contract shall begin on the Effective Date. The term of the contract is for three Fiscal Years (2023-2024, 2024-2025, 2025-2026). The City shall also have two one year options to extend the term of this contract for Fiscal Years 2026-2027 and 2027-2028.

6. Contractual Relationship
The parties intend that an independent contractor-employer relationship will be created by this Contract. City is interested only in the results to be achieved, and the conduct and control of the work will lie solely with Independent Contractor. Independent Contractor is not to be considered an agent or employee of City for any purpose, and neither Independent Contractor nor any employees of Independent Contractor are entitled to any of the benefits that City provides for City's employees. It is understood that City does not agree to use Independent Contractor exclusively. It is further understood that Independent Contractor is free to contract for similar services to be performed for other cities, persons or entities during the term of the Contract.

Independent Contractor shall be fully responsible for all income, social security or other taxes or deductions, including but not limited to worker's compensation and unemployment deductions, relating to the services it performs for City.

Attachment B Agenda Report Page 45

7. Indemnity and Hold Harmless
To the fullest extent permitted by law, Independent Contractor shall defend (with legal counsel reasonably acceptable to City), indemnify and hold harmless City and its officers, elected officials, employees, agents, and volunteers (collectively “Indemnitees”) from and against any and all liability, claims, loss, cost, damage, injury (including, without limitation, injury to or death of an employee of Independent Contractor or its subconsultants), expense and liability of every kind, nature and description (including, without limitation, fines, penalties, incidental and consequential damages, reasonable court costs and attorneys fees, litigation expenses and fees of expert consultants or expert witnesses incurred in connection therewith, and costs of investigation) (“Liability”), except to the extent that such losses, liabilities, damages, or costs and expenses result directly from the gross negligence or willful misconduct of the City, where the same arise out of, are a consequence of, or are in any way attributable to, in whole or in part, the performance of this Contract by Independent Contractor or by any individual or entity for whom Independent Contractor is legally liable, including but not limited to, officers, agents, employees, subcontractors or consultants of Independent Contractor.

For design professionals (as that term is defined by Civil Code § 2782.8) acting within the scope of their professional capacity, to the fullest extent permitted by law, Consultant shall, at its own expense, indemnify, protect, defend (by counsel reasonably satisfactory to the City) and hold harmless any Indemnitees from and against any and all Liability, whether actual, alleged or threatened, which arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Consultant, or as may be provided by statute in Civil Code § 2782.8, as may be amended from time to time.

Neither termination of this Contract nor completion of the services shall release Independent Contractor from its obligations under this Section 7, as long as the event giving rise to the claim, loss, cost, damage, injury, expense or liability occurred prior to the effective date of any such termination or completion, and this section shall survive the termination of the Contract.

8. Insurance
The following minimum levels of insurance coverage shall be provided during the term of this Contract. Prior to the execution of the Contract, Independent Contractor shall provide proof of insurance required. Insurance is to be placed with insurers authorized to conduct business in the state with a current A.M. Best’s rating of no less than A:VII, unless otherwise acceptable to the City.

Independent Contractor shall furnish the City with original certificates and amendatory endorsements or copies of the applicable policy language effecting coverage required by this clause. All certificates and endorsements are to be received and approved by the City before work commences. However, failure to obtain the required documents prior to the work beginning shall not waive Independent Contractor’s obligation to provide them. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.

Attachment B Agenda Report Page 46

Coverage shall be at least as broad as:

1. Commercial General Liability (CGL): Insurance Services Office Form CG 00 01 covering CGL on an “occurrence” basis, including products and completed operations, property damage, bodily injury and personal & advertising injury with limits no less than $2,000,000 per occurrence. If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/location (ISO CG 25 03 05 09 or 25 04 05 09) or the general aggregate limit shall be twice the required occurrence limit.

2. Automobile Liability: ISO Form Number CA 00 01 covering any auto (Code 1), or if Contractor has no owned autos, covering hired, (Code 8) and non-owned autos (Code 9), with limit no less than $2,000,000 per accident for bodily injury and property damage.

3. Workers’ Compensation: as required by the State of California, with Statutory Limits.

4. Professional Liability (Errors & Omissions): As appropriate to Independent Contractor’s services, and not less than $2,000,000 per occurrence.

The insurance policies are to contain, or be endorsed to contain, the following provisions:

The City of Piedmont, its Council Members, directors, officers, agents and employees shall be named as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by or on behalf of Independent Contractor including materials, parts or equipment furnished in connection with such work or operations. General liability coverage can be provided in the form of an endorsement to the Independent Contractor’s insurance (at least as broad as ISO Form CG 20 10 11 85 or both CG 20 10, CG 20 26, CG 20 33, or CG 20 38; and CG 20 37 forms if later revisions used).

For any claims related to this contract, Independent Contractor’s insurance coverage shall be primary insurance coverage (at least as broad as ISO CG 20 01 04 13) with respect to the City, its officers, officials, employees, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, or volunteers shall be excess of the Independent Contractor’s insurance and shall not contribute with it.

Independent Contractor hereby grants to City a waiver of any right to subrogation which any insurer of said Independent Contractor may acquire against the City by virtue of the payment of any loss under such insurance. Independent Contractor agrees to obtain any endorsement that may be necessary to affect this waiver of subrogation, but this provision applies regardless of whether or not the City has received a waiver of subrogation endorsement from the insurer.

Attachment B Agenda Report Page 47

Independent Contractor shall require the insurer to provide City with 30-day prior notice of termination or material change in coverage and ten (10) days prior notice of cancellation for non-payment.

9. Assignability
Independent Contractor shall not assign, delegate, or transfer any interest in this agreement nor the performance of any Independent Contractor's obligations hereunder, without the prior written consent of the City.

10. Miscellaneous
As used in this Contract, the masculine, feminine or neuter gender, and the singular or plural number, shall each be deemed to include the others whenever the context so indicates.

11. Notices
Any notices to be sent pursuant to this Contract shall be given in writing, via facsimile and concurrently by prepaid U.S. certified or registered postage addressed to City at 120 Vista Avenue, Piedmont, California 94611, and to Badawi & Associates at 2855 Telegraph Avenue, Suite 312, Berkeley, CA. 94705 or at such other address as each party shall give the other in writing from time to time, and notices shall be deemed received at the time of personal delivery or three (3) working days after being placed in the United States Mail, postage prepaid, certified mail, return receipt requested.

12. Governing Law
This Contract shall be governed by the laws of the State of California. Jurisdiction and venue of litigation arising from this Agreement shall be in the County of Alameda, State of California.

13. Modification
Any modification of this Contract will be effective only if it is in writing signed by all parties to this Contract.

14. Time is of the Essence
Time is of the essence in the performance of this Contract.

15. Termination
The following provisions shall govern termination under this Contract:
a. Either party may terminate this Contract for cause as follows:
(1) The party electing to terminate shall give the other party written notice Attachment B Agenda Report Page 48

of termination at least five (5) days prior to the termination date, setting forth very specifically the grounds for termination, the specific provisions of the Contract that has been violated, and a full statement of the facts surrounding the violations(s).
(2) If the terminated party so elects, the parties shall meet promptly and make good faith efforts to resolve the violation(s) in a mutually agreeable way.
(3) If any such violation cannot be resolved by the parties at such meeting, or at any mutually agreed extension(s) of such meeting, the termination shall proceed.
(4) If the violation(s) have not been resolved, the terminating party may proceed with termination, and with retaining other person(s) or entities to provide services, if the terminating party is the City. b. Either party may terminate the Contract at any time without cause upon at least sixty (60) days prior written notice to the other party. In the event of any such termination by City, Independent Contractor shall be paid for services actually performed through the date of termination, and Independent Contractor’s work shall be immediately discontinued as of that date, except that City may elect, at City’s option, to have Independent Contractor complete one or more projects or specific activities which are then in progress, in which case Independent Contractor shall be paid for such services until completion. If terminated by Independent Contractor, any assignment accepted by Independent Contractor prior to the notice of termination shall be completed if desired by City.

16. Equal Opportunity
Independent Contractor shall insure that its policies and practices provide equal opportunity to all applicants and employees without regard to race, color, creed, gender , age, religion, national origin, sexual preference, gender identity, marital status, disability, Acquired Immune Deficiency Syndrome (AIDS), AIDS-Related Complex (ARC) and in addition, Independent Contractor must comply with the Americans with Disabilities Act.

17. Compliance with Laws
Independent Contractor shall use the standard of care in its profession to comply with all applicable federal, state, and local laws, codes, ordinances, and regulations.

Independent Contractor represents and warrants to City that it has and shall, at its sole cost and expense, keep in effect or obtain at all times during the term of this Contract any licenses, permits, insurance and approvals which are legally required for Independent Contractor to practice its profession.

18. Entire Agreement
Attachment B Agenda Report Page 49

This Contract constitutes the entire agreement of the parties with respect to the matters set forth herein. Any amendments, modifications, or changes to this Agreement shall be in writing and signed by both parties. In the event of a conflict between the terms set forth in this Contract and the terms set forth in any exhibit to this Contract, the terms of this Contract shall govern over the terms of any exhibit.

19. Ownership of Documents
Unless such property is proprietary in nature, all plans, studies, documents and other writings, including working notes and internal documents, prepared by and for Independent Contractor, its officers, employees and agents and subcontractors in the course of implementing this Agreement, shall become the property of City, upon payment to Independent Contractor for such work, and City shall have the sole right to use such materials in its discretion without further compensation to Independent Contractor or to any other party. Independent Contractor shall, at Independent Contractor’s expense, provide such reports, plans, studies, documents and other writings to City upon written request. All documents prepared by Independent Contractor are confidential and shall be maintained to preserve their confidential nature. Release of any such documents to third parties shall only be made upon written consent of City.

20. Licenses

Independent Contractor represents and warrants that it has all licenses, permits, qualifications, insurance and approvals of whatsoever nature which are legally required of Independent Contractor to practice its profession. Independent Contractor represents and warrants to City that Independent Contractor shall, at its sole cost and expense, keep in effect or obtain at all times during the term of this Agreement, any licenses, permits, insurance and approvals which are legally required of Independent Contractor to practice its profession.
actor to practice its profession.

21. Waiver
Waiver of a breach or default under this Agreement shall not constitute a continuing waiver of a subsequent breach of the same or any other provision under this Agreement.

IN WITNESS WHEREOF, the parties have executed this Contract at Piedmont, California, the day and year first above written.

CITY OF PIEDMONT: Badawi & Associates]:

By: ______________________________ By: ______________________________ [Mayor or City Administrator] [Title]
Attachment B Agenda Report Page 50

Attest:
________________________________
Anna M. Brown, City Clerk
Approved as to form:
________________________________
Michelle Marchetta Kenyon, City Attorney
Deepa Sharma, Assistant City Attorney
Attachment B Agenda Report Page 51