The URL can be used to link to this page

Audit Service Recommendation Copyrighted June 6, 2022 City of Dubuque Consent Items # 07. City Council Meeting ITEM TITLE: Audit Service Recommendation SUMMARY: City Manager recommending the selection of BKD LLP, to replace the City's current auditor Eide Bailly LLP, to provide the City's auditing services for the next five fiscal years and authorize the City Manager to sign the audit service agreement. SUGGESTED Suggested Disposition: Receive and File;Approve DISPOSITION: ATTACHMENTS: Description Type MVM Memo City Manager Memo Staff Memo Staff Memo BKD Technical Proposal Supporting Documentation BKD Cost Proposal Supporting Documentation Eide Bailly Technical Proposal Supporting Documentation Eide Bailly Cost Proposal Supporting Documentation Dubuque THE CITY OF AEI•A�erse City DUB E �II I ' .2013 Masterpiece on the Mississippi 2 2 � pp 2017*17*201919 TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Audit Service Recommendation DATE: May 31, 2022 Director of Finance and Budget Jennifer Larson recommends the selection of BKD LLP, to replace the City's current auditor Eide Bailly LLP, to provide the City's auditing services for the next five fiscal years and authorize the City Manager to sign the audit service agreement. BKD LLP proposal all-inclusive maximum price was $401,950. BKD LLP has a very deep wealth of knowledge and resources when it comes to the government industry. 12.1% of BKD's business is in the public sector and they are ranked the #5 largest provider of single audits. Effective June 1, 2022, BKD will be merging with DHG and will be known as FORVIS. This merger will launch FORVIS to a top 10 accounting firm and give even more knowledge and resources to BKD's current clients. Eide Bailly LLP proposal came in at the highest all-inclusive maximum price of $455,000. Eide Bailly increased fees from the FY21 audit to FY22 audit by approximately 20%. Eide Bailly LLP has served as the City's auditors for many years. Eide Bailly has great experience with auditing other large cities in Iowa, however it is a good business practice to occasionally rotate audit firms and have a new firm give a fresh perspective on the financial statements and internal control procedures. It is typical practice to enter into a 5-year agreement with a new auditing firm. The new firm is going to have increased work in years one and year two as they are learning the City's practices and financials. This is especially true for the City since the FY23 audit will be on a new accounting system and will significantly impact the audit workpapers and year-end process. This gives the accounting firm years 3-5 to try to recover some of their losses in years 1 and 2. I concur with the recommendation and respectfully request Mayor and City Council approval. Mich/7L /U C. Van Milligen MCVM/jml Attachment cc: Crenna Brumwell, City Attorney Cori Burbach, Assistant City Manager Jennifer Larson, Director of Finance and Budget Cassie Ross, Assistant Director of Finance 2 Dubuque THE CITY OF DUB AIFlmeria Cily E ' I I' 3 Masterpiece on the Mississippi 2017*20 9 � pp zo��*zo�� TO: Michael C. Van Milligen, City Manager FROM: Jennifer Larson, Director of Finance and Budget SUBJECT: Audit Services Recommendation DATE: June 3, 2022 INTRODUCTION Fiscal year ended June 30, 2021 was the final year of a five-year contract for providing audit services for the City of Dubuque. An audit services review committee was established to review proposals and recommend a firm to provide audit services to the City for the next five fiscal years (FY'22 — FY'26). Committee members included Jennifer Larson, Director of Finance and Budget; Cassie Ross, Assistant Finance Director; Nathan Kelleher, Budget/Financial Analyst and Madeline Haverland, Community Development Specialist. The committee developed an Audit Services Request for Proposal (RFP). The RFP was posted on the City of Dubuque website and notification was given electronically on March 25, 2022, to 16 CPA firms including the following: All current audit firms for 15 largest Iowa cities All certified Public Accounting Firms in Dubuque Two out of state firms that had expressed interest DISCUSSION Four firms submitted proposals: BKD LLP, West Des Moines, Iowa; Eide Bailly LLP, Dubuque, Iowa; BerganKDV, Cedar Rapids, IA and Atlas CPAs & Advisors PLLC, Cedar Rapids, Iowa. The audit services review committee reviewed the proposals. Two firms were selected for interviews: Eide Bailly LLP and BKD, LLP. The committee requested that Eide Bailly submit a cost proposal for a one-year extension after RFP proposals were submitted. With the workload of the ERP system conversion, it would have been ideal to maintain the current auditors for the last year on the current accounting system. Then, if we were to switch firms it would make sense to change with the start of a new ERP system. Eide Bailly submitted their proposal, and it was an increase of approximately 32% ($22,000) from FY21's base audit contract cost. The committee felt this was an unreasonable proposal and decided to move forward with the RFP review process. Eide Bailly LLP proposal came in at the highest all-inclusive maximum price of $455,000. Eide Bailly increased fees from the FY21 audit to FY22 audit by approximately 20%. Eide Bailly LLP has served as the City's auditors for many years. Eide Bailly has great experience with auditing other large cities in Iowa, however it is a good business practice to occasionally rotate audit firms and have a new firm give a fresh perspective on the financial statements and internal control procedures. As a City, it is important to make sure new accounting standards are implemented correctly and staff is maintaining industry best practices when it comes to internal controls and not accepting "this is the way we have always done things." BKD LLP proposal all-inclusive maximum price was $401,950. BKD gave an excellent interview and were overall very impressive. BKD has a very deep wealth of knowledge and resources when it comes to the government industry. 12.1% of BKD's business is in the public sector and they are ranked the #5 largest provider of single audits. Effective June 1, 2022, BKD will be merging with DHG and will be known as FORVIS. This merger will launch FORVIS to a top 10 accounting firm and give even more knowledge and resources to BKD's current clients. During BKD's interview they talked a lot about their unmatched client service, and they pride themselves on the service experience. This was very apparent throughout the interview when the committee asked many questions regarding audit methodology and BKD's typical practices. BKD's team swiftly answered all questions the committee asked, and we believe they will be a great partner with the City. BKD also included an impressive listing of municipalities that they currently perform the audit for. We also performed a reference check on BKD. The reference discussed that BKD has different focus areas than what Eide Bailly has historically focused on, and it was nice to get a fresh perspective. BKD also has other individuals throughout their firm that they consult with and have extensive government and city auditing expertise. Based on the consensus of the committee, I recommend seeking approval to issue a contract with BKD LLP. It is typical practice to enter into a 5-year agreement with a new auditing firm. The new firm is going to have increased work in years one and year two as they are learning the City's practices and financials. This is especially true for the City since the FY23 audit will be on a new accounting system and will significantly impact the audit workpapers and year-end process. This gives the accounting firm years 3-5 to try to recover some of their losses in years 1 and 2. A copy of the BKD LLP and Eide Bailly LLP proposal and dollar cost bid are enclosed. ACTION The audit services review committee requests your review and submission to the City Council for the approval of BKD LLP to begin as the City's auditing firm for the next five fiscal years and subsequent authorization for you to sign the audit service agreement. If there are any questions on the process or recommendation, please feel free to contact me. Thank you for your consideration. Enclosures cc: Cassie Ross, Assistant Finance Director Request for Proposal for Annual Auditing Services A Fresh Look from Advisors Committed to Providing Unmatched Client Service® City of Dubuque, Iowa Submitted by BKD, LLP 1401 50th Street I Suite 350 I West Des Moines, IA 50266 Phone: 515.223.0159 Jessica R. Richter, CPA, CITP, CISA I Partner April 22, 2022 BKD Technical Proposal CPAs & Advisors Transmittal Letter iii Executive Summary 1 Solutions for City of Dubuque 2 Ull Why Choose BKD 2 Detailed Proposal 7 2. Independence 7 3. License to Practice in Iowa 8 4. Firm Qualifications & Experience 8 5. Partner, Supervisory& Staff Qualifications & Experience....10 LLI 6. Similar Engagements with Other Government Entities 24 7. Specific Audit Approach 26 8. Identification of Anticipated Potential Audit Problems 36Z Proposer Guarantees & Warranties 37 Appendix 400 Exceptions to Terms & Conditions 41 Thinking of Your Future 42 0 AICPA Peer Review Letter 44 BKD Peer Review Report 45LL Press Release 46 BKD Firm Profile 48 0 Facing Risk with Confidence 49 BKD PRIDE Values 50 UNI ca L th...mill ,_<:( B L Our acceptance of this engagement is subject to completion of our normal client acceptance procedures. Upon acceptance,the actual terms of our engagement will be documented in a separate letter to be signed by you and us. The information provided in this proposal is intended for informational purposes only and may not be copied,used or CPAs&Advisors modified,in whole or in part,without BKD's prior written approval.All information in this proposal is as of May 31, 2021,unless otherwise noted. BKD 1401 50th Street,Suite 350 I West Des Moines, IA 50266-5935 CPAs&Advisors 515.223.0159 I Fax 515.223.5429 I bkd.com Transmittal Letter April 22, 2022 Ms. Cassie Ross Assistant Director of Finance City of Dubuque, Iowa 50 West 13th Street Dubuque, IA 52001 Dear Ms. Ross: As the oldest city in our state, City of Dubuque, Iowa (City of Dubuque) is no stranger to the numerous items needing attention as you work to keep Dubuque an attractive destination. Among the daily matters competing for your focus are the expectations to maintain a fiscally sound organization and demonstrate GASB-compliant financials, which are no small tasks as governmental entities and airports are under the microscope and face stringent reporting requirements. The COVID-19 pandemic has further compounded these issues, making adherence to various regulations even more important moving forward. Having peace of mind as you work through these responsibilities is pivotal, and BKD CPAs &Advisors is here to help. By putting a new set of eyes on your accounting practices, we can share innovative guidance and strategies for improvement. We look forward to providing Unmatched Client Service®as City of Dubuque strives to maintain financial reporting excellence and preserve your reputation of being a masterpiece on the Mississippi. Providing personal attention and frequent communication to our clients is what drives us—and delivering value beyond the basic service approach is among our top priorities. In addition to the benefits described throughout our proposal, we believe BKD is the right choice based on the following points: ► Experience working a wide range of public sector entities and airports across the country ► One of the top providers of Single Audit services nationwide ► Personnel who serve on Government Finance Officers Association's Special Review Committee ► A wealth of GASB resources for new standard adoption BKD understands this engagement includes a Financial Statement Audit in Accordance with Government Auditing Standards for City of Dubuque and Dubuque Metropolitan Solid Waste Agency, including U.S. Department of Housing and Urban Development agreed-upon procedures and a Passenger Facility Charge Program audit, as well as a Compliance Audit in Accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance), for the years ending June 30, 2022 through 2026. We are committed to performing the work within the required time period. BKD acknowledges receipt of addendum one and addendum two. iii L� PRAX!TV We believe our proposal will help you select our firm for efficient and objective services delivered by experienced professionals. If you have any questions about this proposal, you may reach me at 515.223.0159 or by email at jrichter@bkd.com. Sincerely, Jessica R. Richter, CPA, CITP, CISA Partner BKD Executive Summary It's no secret municipalities similar to City of Dubuque, Iowa (City of Dubuque) are held to high standards of reporting that call for careful planning and diligent strategies. Of course, implementing GASB's lease and subscription-based IT arrangement pronouncements will be important. Satisfying strict Passenger Facility Charge (PFC) requirements and retaining recognition under the Government Finance Officers Association's (GFOA) Certificate of Achievement for Excellence in Financial Reporting Program (COA Program) are also pertinent considerations. In addition, appropriately using and accounting for federal funding is paramount to positioning City of Dubuque for success. Since this LC5 funding comes with stringent requirements, it's critical your auditors understand the expanded reporting complexities related to the American Rescue Plan Act of 2021 (ARPA) as you seek to maintain Single Audit compliance. Having a trusted advisor by your side can help you address these items with confidence, and BKD CPAs &Advisors is here to provide the assistance you desire. Our experienced professionals can offer a fresh perspective on your internal reporting, which can result in new ideas and recommendations. We stand ready to provide Unmatched Client Service°and year-round communication to help City of Dubuque have peace of mind moving forward. You can expect the following from working with BKD: ► Extensive public sector expertise, including audit work with many similar- We serve sized municipalities and airports approximately 540 ► A depth of knowledge related to Single Audit requirements and how public sector entities. COVID-19 funding can affect your financials ► Significant Annual Comprehensive Financial Report(ACFR) insights and innovative tools that can help streamline the reporting process ► Dedication to keeping them apprised of emerging industry developments and best practices through year-round communication and BKD Thoughtware° ► Access to deep bench of national resources available to help address a variety of challenges There's a difference between an accountant and a trusted advisor. As accountants, we're ready to complete your requested services per your established deadlines. That isn't enough, though—we believe there's more we can offer City of Dubuque. As trusted advisors, we want to share pertinent industry and regulatory updates that may directly affect your bottom line throughout the year and recommend solutions for challenges yet to be seen. This proactive methodology is a hallmark of our Unmatched Client Service standards and what City of Dubuque can and should expect from us. 1 BKD Solutions for City of Dubuque City of Dubuque has requested information and a fee quote for the following professional services: SUPPORT ► Financial Statement Audit in Accordance with Government Auditing Standards for City of Dubuque and Dubuque Metropolitan Solid Waste "The BKD audit approach Agency, including U.S. Department of Housing and Urban Development brought a fresh perspective, (HUD) agreed-upon procedures and a PFC Program and focused on realistic, reasonable and purposeful ► Compliance Audit in Accordance with Title 2 U.S. Code of Federal testing,looking at areas of Regulations Part 200, Uniform Administrative Requirements, Cost Principles, importance. The engagement and Audit Requirements for Federal Awards (the Uniform Guidance) partner also provided assistance on new GASB BKD and Dixon Hughes Goodman LLP (DHG) have agreed to a merger of pronouncements and assisted equals, effective June 1, 2022. Any work provided after the effective date will be us with reporting performed by the combination of our two firms. Please see section 7. Specific requirements." Audit Approach beginning on page 26 for a detailed explanation of BKD's audit Kimberly Auchstetter service approach. Finance Director/Treasurer Village of New Lenox,Illinois Thinking of Your Future In addition to City of Dubuque's requested services, BKD has an extensive range of service offerings that may be relevant to you now or in the future. If the need arises, the following services could benefit City of Dubuque: ► BKD LeaseVision: Assistance with GASB 87 Implementation ► BKD Public Sector Reporting Solutions ► IntegraReportTM If you would like additional information about these options, please see the Appendix or contact Partner Jessica Richter at your convenience. Why Choose BKD Delivering Value Monitoring expenditures and receiving exceptional value for your investments is important, but informed consumers understand value is about more than just price. Value from a professional CPA and advisory firm is about the quality of the work and the merit of the advice. Expect BKD's work to be accurate and insightful. We stand behind it. Our Public Company Accounting Oversight Board (PCAOB) inspections and American Institute of CPAs (AICPA) peer reviews demonstrate the firm's record of excellence. As evidenced by our inclusion in the INSIDE Public INSIDE Accounting Best of the Best Firms list for the last 11 years, we also offer long-term consistency, exceptional PUBLIC ACCOUNTING performance and a national network of support and BESTBEST resources. BKD is large enough to help City of Dubuque FIRMSLaddress a variety of financial issues. At the same time, we pride ourselves on hard work and low overhead, which keep our fees competitive. With our reputation, size, service and experience, you can consider us a good value. 2 BKD Municipality Expertise BKD is the CPA and advisory firm of choice for approximately 130 municipalities. EXPERTISE Overall, audit and assurance services comprise 85 percent of our service hours to our public sector clients. This experience can provide City of Dubuque with a wealth of resources from a firm that develops our professionals' skill sets in these sectors. With dedicated advisors in BKD National Public Sector Group, we have "The BKD team brings a vast amount of knowledge and the experience and level of commitment you require as you look for help in experience in government identifying ways to deliver services and meet fiduciary and regulatory auditing,which is key for us as requirements effectively. a government entity." Significant Single Audit Experience answero advisorsBKD qesewisingto answer our questions,not only in the audit period,but According to data compiled by the Office of Management and Budget (OMB)via throughout the year. Our the Federal Audit Clearinghouse, BKD is the fifth-largest provider of Single Audits advisors are available, among CPA firms, performing approximately 480 annually. With approximately professional,and responsive. one-third of our nonprofit and public sector clients receiving federal funding, we Their expertise in government accounting is greatly are familiar with the requirements for allowability of both direct and indirect costs, appreciated,and they as well as the ability for the recipient to charge an administrative cost allowance continue to be a huge under many federal programs. resource for our team." To help streamline the Single Audit process, we use audit programs and Melinda Jones checklists designed specifically for the federal programs we audit. Our firm City Controller City of Lincoln,Nebraska maintains a database of audit programs tailored to the grants and other federal programs commonly found in governmental entities. Our extensive experience providing compliance testing in accordance with OMB requirements can help us properly perform and submit City of Dubuque's Single Audit on time. Experience Working with Airports We provide assurance, accounting and other advisory services to approximately 30 airports across the country. We work with clients ranging in size from small regional airports to large international hubs. Through this experience, we have developed a strong understanding of the PFC Program and the Airport Improvement Program (AIP) and tailor our audit programs specifically to the compliance requirements of these programs. According to data compiled by OMB via the Federal Audit Clearinghouse, for the past several years, BKD has ranked among the top two CPA and advisory firms auditing AIP funds. In 2020, we audited approximately $700 million of AlP funds spent by approximately 25 airport clients. Beyond delivering a wealth of commercial airport and public sector expertise, our audit approach relies upon frequent, high-level involvement of key professionals in the delivery of our services which helps mitigate potential surprises. We can help City of Dubuque plan for the future, comply with regulations and expend resources wisely. 3 BKD Extensive Experience with the COA Program Participating in GFOA's COA Program can help enhance the credibility of a city's financial statements, particularly with rating agencies. This also is key to increasing constituent and user confidence in City of Dubuque's fiscal management practices and overall financial condition. We understand City of Dubuque has received this recognition for 33 consecutive years, and BKD can help you maintain your certificate. Hundreds of our clients participate in this program annually, which means we have the practical knowledge and expertise necessary to guide you through the process. Numerous BKD professionals also serve on the GFOA's Special Review Committee, providing us with firsthand insight into what GFOA reviewers are looking for when assessing the required reports. In addition, with the short window for completing annual audits to meet the GFOA's established deadlines, we understand prompt and accurate professional services are critical in retaining your certificate. A core standard of BKD's Unmatched Client Service philosophy is Responsive Reliability, which guides our service process from initial planning to issuing our final report. You can expect our reports and communication to be efficient and in advance of GFOA's deadlines. Commitment to an Inclusive Corporate Culture Firmwide, BKD's SKY initiative seeks to emphasize and strengthen diversity, identify and remove cultural barriers and create a level playing field for all personnel. SKY focuses on: ► Cultivating an inclusive corporate culture ► Attracting and developing diverse talent ► Engaging firm leaders in strategies and programs aimed at improving diversity and inclusion Through these strategies, BKD takes specific actions to encourage diversity and inclusion, such as educational programs, conferences, sponsor-protégé mentoring relationships, managerial training, engaging with diverse communities during the recruitment process and participating in innovation tournaments and task forces to generate new ideas and client solutions. Feedback from BKDers shows that we're on the right path. In our 2020 engagement survey, 76 percent of firm members stated that they felt they belonged at BKD, 76 percent could be their authentic self at work and 88 percent are proud to work for BKD. Through focused action, we continue to build an environment where BKDers are empowered and unique perspectives are valued. 4 BKD Brand New Firm, Similar Service Focus Changes are inevitable—City of Dubuque understands that as much as anyone—but they don't have to be a challenge. That's why we're excited to announce BKD has agreed to a merger of equals with DHG, effective June 1, 2022. This exciting new chapter in our history will result in a new Top 10 professional services firm with a significantly larger national presence and an international footprint. More importantly, however, is how this may affect City of Dubuque. With complementary operations, geographies and nearly two centuries of legacy service between them, the combination of our two firms can provide deeper industry focus and expanded advisory services. That means clients can receive a wider range of service options and personalized attention from our experienced professionals, regardless of location. Because City of Dubuque may still have questions, we're committed to transparency and accessibility throughout this transition. No matter where the future takes us, you can have confidence our dedication to providing an exceptional client service experience remains unchanged. Please see our full press release in the Appendix, or visit bkd.com, for more information. BKD A combination of PASSION, RESPECT, INTEGRITY, DISCIPLINE & EXCELLENCE represents what we strive for every day when helping you move forward with confidence. 5 BKD Unmatched Client Service You can count on BKD's You want trusted advisors who will deliver exceptional client service, focus on commitment to our five your needs and take the time to address your unique challenges. BKD standards of Unmatched understands. We take our commitment so seriously, we penned five standards of Unmatched Client Service and supporting guidelines in The BKD Experience: Client Service Unmatched Client Service, a book that articulates the firm's philosophy and sets expectations for serving clients. Our five standards are: Integrity First We work hard to do what is right for you. You can rely on us to tell you what you need to hear. True Expertise +� From BKD, you can expect trained, capable staff and a high level of supervision Integrity First by partners and experienced personnel. Professional Demeanor j. You can depend on prepared and attentive advisors to help meet your needs and provide new ideas. Responsive Reliability True Expertise Accurate and thorough work combined with timely delivery is what you require. At BKD, we do not want it any other way. .� Principled Innovation II o I� We want you to succeed. For City of Dubuque, that means looking for new ideas Professional Demeanor to streamline a process, better document work, train your staff and improve your effectiveness. Responsive Reliability Principled Innovation 6 BKD Detailed Proposal For your convenience, we have structured our proposal according to the requirements in your REP. We believe our proposal will demonstrate our qualifications to serve City of Dubuque. PROFESSIONALISM INFORMATION CONTAINED IN BKD'S RFP RESPONSE, WHICH IT ASSERTS AS CONFIDENTIAL, IS EITHER BUSINESS AND/OR PROPRIETARY TRADE SECRET INFORMATION NOT SUBJECT TO DISCLOSURE AS SET FORTH IN "BKD just completed the first THE IOWA OPEN RECORDS LAW. SUCH CONFIDENTIAL INFORMATION HAS year audit engagement with INDEPENDENT ECONOMIC VALUE TO BKD, IS NOT REASONABLY the City. The transitional year went extremely smooth. ASCERTAINABLE BY THIRD PARTIES AND IS THE SUBJECT OF BKD's staff did an excellent REASONABLE EFFORTS BY BKD TO MAINTAIN ITS SECRECY AND/OR job working with our staff CONFIDENTIALITY. SUCH INFORMATION IN THIS PROPOSAL SHALL BE during the transition. During DESIGNATED WITH AN ASTERISK(*). the engagement,BKD provided knowledgeable support and guidance. The 2. Independence audit was completed on schedule,and BKD always The firm should provide an affirmative statement that it is independent of the City completed their deliverables of Dubuque as defined by generally accepted auditing standards/the U.S.General on time." Accounting Office's Government Auditing Standards(1994 revision). Allen Herink The firm also should provide an affirmative statement that it is independent of all of City Comptroller the component units of the City of Dubuque as defined by those same standards. City of Omaha,Nebraska BKD is independent with respect to City of Dubuque and your component units as defined by the Code of Professional Conduct of the AICPA and the U.S. Government Accountability Office's Government Auditing Standards. We are not aware of any relationship that would impair our independence. The firm should also list and describe the firm's(or proposed subcontractors) professional relationships involving the City of Dubuque(or any of its component units or oversight units)for the past five(5)years,together with a statement explaining why such relationships do not constitute a conflict of interest relative to performing the proposed audit. BKD has not had any professional relationship with City of Dubuque or related entities within the last five years. No relationship exists that would constitute a conflict of interest relative to performing the proposed audit. In addition,the firm shall provide the City of Dubuque written notice of any professional relationships entered into during the period of this agreement. BKD will provide the City of Dubuque written notice of any professional relationships entered into during the period of this agreement. 7 BKD 3. License to Practice in Iowa An affirmative statement should be included that the firm and all assigned key professional staff are properly registered/licensed to practice in the state of Iowa. BKD is properly licensed to practice public accounting in the state of Iowa. All key professionals who would be assigned to your engagement are properly registered/licensed to practice in the state of Iowa or able to practice in the state due to mobility laws, without the requirement to obtain an individual Iowa license. 4. Firm Qualifications & Experience The proposer should state the size of the firm,the size of the firm's governmental audit staff,and the location of the office from which the work on this engagement is to be performed. Also,state the number and nature of the professional staff to be employed in this engagement on a full-time basis and a part-time basis. Firm Size BKD is one of the largest CPA and advisory firms in the United States. As of March 2022, we have 42 offices located in 19 states. Our approximately 3,030 CPAs, advisors and dedicated staff serve clients in all 50 states and clients with operations in more than 40 countries. Governmental Audit Staff Size BKD has approximately 490 professionals who spend more than 50 percent of their billable hours providing services to clients in the nonprofit, governmental and higher education industries, including audit services to governmental entities. Location City of Dubuque's requested services will be provided primarily by our Des Moines office. BKD CPAs &Advisors 1401 50th Street I Suite 350 West Des Moines, IA 50266 Number & Nature of Staff We anticipate providing one partner, one manager and two senior associates/associates on a full-time basis and one managing director(concurring reviewer)on a part-time basis to complete City of Dubuque's requested services. If the proposer is a joint venture or consortium,the qualifications of each firm comprising the joint venture or consortium should be separately identified and the firm that is to serve as the principal auditor should be noted, if applicable. BKD is not a joint venture or consortium. The firm is also required to submit a copy of the report on its most recent external quality control review,with a statement whether that quality control review included a review of specific government engagements. BKD is committed to providing quality audit services to our clients. We submit our work to external reviewers who challenge our approach and findings. We are proud of the findings from these reviews, which indicate our process works. Our report contained a rating of"Pass,"which is the best peer review rating available under the current peer review standards. A copy of our most recent AICPA peer review report is included in the Appendix, and our peer review included inspection of engagements performed under Government Auditing Standards. 8 BKD The firm shall also provide information on the results of any federal or state desk reviews or field reviews of its audits during the past three(3)years. From time to time, selected BKD audit engagements are subject to desk review by federal or other regulators. All such reviews during the past three years have shown our work to be generally satisfactory, and no disciplinary or other administrative proceedings have resulted from those reviews. In addition,the firm shall provide information on the circumstances and status of any disciplinary action taken or pending against the firm during the past three(3)years with federal or state regulatory bodies or professional organizations. None. Highlight activities in the governmental sector, including Special Designations,consulting, membership in government organizations and sponsorship of governmental CPEs. Commitment to Serving the Public Sector As part of our commitment to remaining at the forefront of the public sector, leaders across our national governmental practice created the BKD Public Sector Center of Excellence. This group of professionals meets regularly to discuss important developments, legislative updates and challenges affecting governmental entities similar to City of Dubuque. In addition, our public sector involvement has enabled us to establish connections with numerous regulatory and auditing organizations, including: ► AICPA Governmental Audit Quality Center, as a member ► Government Finance Officers Association (GFOA) AICPA® ► Governmental Accounting Standards Board (GASB) Governmental Audit ► Office of Management and Budget (OMB) Quality Center ► U.S. Government Accountability Office We look forward to communicating best practices and forward-looking strategies to help City of Dubuque thoughtfully consider the areas important to fulfilling your fiduciary responsibilities. Industry Involvement To reinforce our commitment to the governmental sector, our advisors routinely attend conferences focused on industry issues and trends. They also receive continuing professional education (CPE)to stay informed of industry regulatory updates and other general accounting issues, averaging approximately 60 hours of formal training annually. This dedication also extends to involvement on national industry committees, such as GASB and the AICPA. Partner Lindsey Oakley, who currently serves in BKD's National Office accounting and auditing department, has been appointed to the Executive Committee of the AICPA Governmental Audit Quality Center. Chris Telli, a partner in our Colorado Springs office, has been appointed as an advisor to the Government Finance Officers Association's Committee on Accounting, Auditing, and Financial Reporting. This committee works closely with GASB, the AICPA and other organizations and recommends best practices for effective governmental finance operations. Amy Shreck, a director in our Omaha office, completed a two-year term as a practice fellow at GASB's headquarters, where she helped to formulate standards and assisted with technical inquiries. 9 BKD BKD now draws on Amy's firsthand experience at GASB to help clients better understand GASB standards and the thought process behind those standards. Jim Brown, retired BKD partner, was appointed January 12, 2012, to the seven-member GASB. He completed a five-year term on the board and was elected to a second and final term, which will conclude June 30, 2022. In this capacity, Jim is helping develop and improve the financial accounting and reporting standards used by state and local governments across the country. He specialized in governmental accounting and auditing for approximately 40 years and served as a BKD partner for more than 25 years before retiring in May 2011. He was responsible for quality control and training for BKD's government and nonprofit practice and acted as the firm's principal contact with GASB. Since retirement, he has been serving as a CPE instructor for the AICPA. He also has been a member of AICPA's Auditing Standards Board and Board of Examiners. As mentioned, numerous BKD professionals also serve on the GFOA's Special Review Committee, providing us with firsthand insight into what GFOA reviewers are looking for when assessing the required reports. BKD advisors also actively serve as participants, exhibitors, speakers and sponsors in regional and national associations for governmental organizations, including: ► Airports Council International— North America (ACI-NA) ► American Association of Airport Executives (AAAE) ► Association of Airport Internal Auditors (AAIA) ► Association of Government Accountants (AGA) ► Government Finance Officers Association (GFOA) ► National League of Cities (NLC) ► Rural Utilities Service (RUS) Thought Leadership BKD advisors are serious about reinforcing their positions as thought leaders in the industries they serve. To help keep you informed about emerging issues in your industry, as well as changes in regulations and accounting and tax methods, we provide Thoughtware webinars, seminars, tailored training sessions, podcasts and articles. Many of these are eligible for CPE credit. Recent topics include: ► Implementing GASB 87: What You Need to Know ► GASB 87: Breaking Down Implementation for Airports ► Navigating State & Local Fiscal Recovery Funds: Final Rule & Early Lessons Learned ► GASB 2022—The Year Ahead We encourage you to view these and a wide array of other resources available on bkd.com. 5. Partner, Supervisory & Staff Qualifications & Experience Identify the principal supervisory and management staff, including engagement partners, managers,other supervisors and specialists,who would be assigned to the engagement. Indicate whether each such person is registered or licensed to practice as a certified public accountant in Iowa. Provide information on the government auditing experience of each person, including information on relevant continuing professional education for the past three(3)years, listing courses completed and membership in professional organizations relevant to the performance of this audit. 10 BKD Provide as much information as possible regarding the number,qualifications,experience and training, including relevant continuing professional education,of the specific staff to be assigned to this engagement. Indicate how the quality of staff over the term of the agreement will be assured. The most critical factor in providing high-quality service is choosing your engagement team. We take team selection seriously and have the appropriate team of advisors to meet your needs over the term of the engagement. As mentioned, BKD is properly licensed to practice public accounting in the state of Iowa. All key professionals who would be assigned to your engagement are properly registered/licensed to practice in the state of Iowa or able to practice in the state due to mobility laws, without the requirement to obtain an individual Iowa license. Engagement Team Experience Jessica R. Richter, CPA, CITP, CISA Partner Alb Engagement Role: Lead Engagement Partner Jessica has more than 20 years of experience providing audit, tax and consulting services for tv a variety of nonprofit organizations, school districts, public universities, state agencies, municipalities and telecommunications companies. Her specialties include financial reporting two and auditing, financial projections and forecasts, due diligence, cost allocations, revenue assurance, loan applications, Single Audit and business consulting. Jessica is a licensed CPA in Iowa. She is a member of the American Institute of CPAs, Iowa Society of CPAs, the Accounting & Financial Women's Alliance and the ISACA. Jessica obtained her CPA certificate in 2000 and her Certified Information Technology Professional accreditation in 2008. In 2015, she obtained her Certified Information Systems Auditor certification. She currently serves as a board member for Dress for Success Des Moines and Waukee Athletic Club (Waukee Fastpitch). Jessica is a 2000 graduate of University of Northern Iowa, Cedar Falls, with a B.A. degree in accounting. As of April 2022, she has completed approximately 243 hours of CPE in the past three years. CPE Courses Jessica R. Richter, CPA, CITP, CISA Date CPE Course Completed Hours 01/27/2021 What Nonprofits Need to Know About the Latest COVID-19 Stimulus Bill 1 (EW-2234) 05/07/2021 2021 ISCPA Leadership Conference and Annual Meeting 1 05/17/2021 Iowa Governmental Audits - Local Government Update 4 05/18/2021 Iowa Governmental Roundtable 7 06/09/2021 AICPA Not-for-Profit Industry Conference 2021 11 06/28/2021 Governmental Accounting Basics 4 07/21/2021 2021 Nonprofit, Higher Education, & Public Sector Virtual Industry 4 Session (IW-2268) 08/04/2021 TFACC 2021 5.5 11 BKD Jessica R. Richter, CPA, CITP, CISA Date CPE Course Completed Hours 08/05/2021 2021 Telecommunications Virtual Session (IW-2368) 2.5 08/12/2021 2021 Telecom Accounting Seminar(EL-2358) 10 08/17/2021 How to Streamline the Financial Reporting Process 2 09/21/2021 2021 Compliance Supplement& Single Audit Update (EW-2437) 1 09/30/2021 Nonprofit Board Basics, Part 2: Great Governance (EW-2440) 1 10/07/2021 Nonprofit Board Basics, Part 3: Engaging Your Board for Mission 1 Success (EW-2441 10/19/2021 keynet SharePoint Online &Teams Collaboration Training (Self-Study) 0.5 10/21/2021 Journal Entry Testing (IW-2517) 1 10/22/2021 Winning at All Costs: Case Studies in Behavioral Ethics (IW-2511) 1 10/26/2021 5th Annual Des Moines BKD CFO Seminar(EL-2469) 3 11/03/2021 Nonprofit Higher Education & Public Sector Industry Leader Training 6.5 (LC21) 11/04/2021 Audit: Recognizing Fraud & Fraud Risks (LC21) 1 11/04/2021 Audit: Understanding & Leveraging BKD's Audit Technology Tools 1 (LC21) 11/04/2021 Audit General Session (LC21) 4 11/04/2021 Audit: LeaseVision &Other Lease Tools (LC21) 1 11/05/2021 General Session (LC21) 4 11/05/2021 Annual Partner-Managing Director Business Meeting (LC21) 2.5 11/29/2021 Leases Module 1: Overview of Lessee Accounting (Self-Study)) 1 12/02/2021 2021 Single Audit Update (Self-Study) 1.5 12/02/2021 Using the Work of Internal Audit: Update to BKD Policy (Self-Study) 1 12/02/2021 State & Local Government Client Affiliates (Self-Study) 0.5 12/03/2021 GASB Module 1: Governmental Financial Reporting Basics (Self-Study) 0.5 12/09/2021 2021 SKYx (IL-2576 & 2578) 13 12/10/2021 GASB Leases (IW-2583) 1.5 12/10/2021 Lessons Learned from Litigation (When other CPA Firms Get Sued) 1 (IW-2582) 12/15/2021 What's Going On: Tips for Your Personal Tax& Investment Planning 1 (IW-2586) 01/25/2020 Proposals, Client Acceptance and Engagement Letters (contracts)- 1 Changing BKD's Process (Self-Study) 05/11/2020 Iowa Governmental Audits - Local Government Update 4 12 BKD Jessica R. Richter, CPA, CITP, CISA Date CPE Course Completed Hours 05/12/2020 Iowa Governmental Roundtable 8 05/29/2020 2020 Single Audit Update (IW-1956) 1 06/17/2020 Virtual LC20 General Session (IW-1975) 2 06/19/2020 Commercial Services Industry Virtual Session (IW-1978) 3.5 06/24/2020 AICPA Not-for-Profit Industry Conference 2020 15 07/09/2020 BKD Materiality Methodology Training (V-1990) 4 07/19/2020 A&A Response to COVID-19 (Self-Study) 1 07/29/2020 New Borrower Defense Rules: A Deeper Dive into Regulations & 1 Reporting Requirements (EW-2027) 08/04/2020 2020 Virtual TFACC 1 08/12/2020 Not-for-Profits Basics 8 08/13/2020 BKD's Guide to Public Sector Accounting: Single Audit Testing Basics 1 Refresher 08/17/2020 Single Audit Basics 4 09/10/2020 A Practical Approach to Implementing Leases (EW-1999) 1.5 09/15/2020 Enterprise Risk Management for Nonprofits (EW-2077) 1 09/16/2020 Internal Controls, Conflicts of Duties & Other Items Relevant to Risk 1 Assessment 09/17/2020 Redefining BKDconnect-Tips and Tricks on Increasing Functionality 1 (IW-2111) 09/17/2020 2020 Single Audit Update- Part 2 (IW-2107) 1 09/24/2020 Tips for Presenting Financial Information (EW-2017) 1 09/29/2020 Digital Transformation in 2020: Making the Most of Remote Work (EW- 1 2099) 10/13/2020 Addressing Cybersecurity Concerns Amid COVID-19 (EW-2100) 1 10/20/2020 Closing the GAAP: 2020 Nonprofit GAAP Update (EW-2094) 1 10/27/2020 Des Moines BKD CFO Seminar(VC-2114) 2.5 11/03/2020 How to Manage Operational Risk at Your Nonprofit (EW-2098) 1 11/05/2020 2020 A&A Annual Update (IW-2121) 3.5 11/05/2020 2020 A&A Annual Update- Core Concepts Update (IW-2121) 2 11/09/2020 Introhive (Self-Study) 0.5 11/15/2020 Independence at BKD (Self-Study) 1 11/17/2020 State of the Nonprofit Sector Amid COVID-19 (EW-2095) 1 13 BKD Jessica R. Richter, CPA, CITP, CISA Date CPE Course Completed Hours 11/19/2020 Managing Engagements - The Engagement Management Dashboard 1 (IW-2166) 11/19/2020 Tales From the BKD Vault- Case Studies in Behavioral Ethics (IW- 1 2165) 11/24/2020 Auditing Estimates &the Use of Specialists -A Look at the New PCAOB 1.5 Auditing Standards (Self-Study) 11/24/2020 Critical Audit Matters (Self-Study) 1 12/10/2020 Statement of Cash Flows: Common Errors & How to Find Them (IW- 1 2199) 12/10/2020 Top 10 Plus Ethical Challenges that Could Jeopardize Your Career(IW- 1 2198) 12/14/2020 Tackling Your CAFR-What to Remember Before Submitting (EW-2159) 1.5 12/16/2020 Going Concern Considerations (Self-Study) 0.5 01/03/2019 Overview of Performing Independent Reviews of Audit Engagements 2 05/07/2019 NFP Roundtable: A Forensic Accountant's Top 10 Practical Controls for 1 Not-for-Profits (EL-1476) 05/17/2019 BKD STI: Process & Mentoring: Building the Foundation for Success (IL- 05/17/2019 1515) 05/17/2019 The 2018 Yellow Book: What Changes Do You Need to Know About? 1 (IW-1517) 05/28/2019 Lunch & Learn: Giving Constructive Feedback(LL-1519) 1 06/20/2019 ASC 842 New Lease Accounting Project Failures & Lessons Learned 1 07/09/2019 Manufacturing & Distribution -Tuesday (LC19) 1 07/09/2019 General Session (LC19) 3 07/09/2019 Telecommunications-Tuesday (LC19) 3 07/10/2019 Not-for-Profit & Government-Wednesday-Track 2 (LC19) 1 08/15/2019 2019 Telecom Accounting Seminar(EL-1580) 10.5 08/16/2019 Ethics in the Real World - BKD and Beyond (IW-1642) 1 08/16/2019 BKD STI: BKD Business Development Framework- Intelligence and 1 Relationships (IL-1638) 09/20/2019 BKD STI: Uncovering Cross-Servicing Opportunities (IL-1679) 1 10/08/2019 More Connected, More at Risk (EL-1680) 1 10/18/2019 GASB 84 - Fiduciary Activities Update (IW-1717) 1 10/18/2019 BKD STI: BKD Business Development Framework- Propose &Commit 1 (IL-1681) 10/21/2019 Nonprofit Organizations Conference 8 10/22/2019 Third Annual BKD Des Moines CFO Seminar(EL-1632) 2.5 14 BKD Jessica R. Richter, CPA, CITP, CISA Date CPE Course Completed Hours 11/01/2019 2019 A&A Annual Update (IL-1687) 5 11/11/2019 Not-for-Profit Accounting 5 11/11/2019 Coaching Lunch & Learn: Project Evaluations 1 12/13/2019 SKY Professional Development Series: 50 Ways to Fight Bias (IL-1746) 2.5 12/13/2019 BKD STI: Leveraging Crucial Conversation to Enhance Client 1 Relationships (IL-1818) 12/13/2019 TeamMate Analytics Overview, Sampling &Journal Entry Testing (IW- 1 1808) Marcella D. Ardan, CPA Managing Director Engagement Role: Concurring Reviewer Marcie is a member of BKD National Public Sector Group and BKD National Higher Education Group and leads these industries in BKD's Colorado and Salt Lake City offices. de r She has approximately 17 years of governmental accounting and auditing experience, providing audit, assurance and consulting services to public sector entities including cities and counties, library and school districts, colleges and universities, utilities, state agencies, government investment pools and other tax-exempt organizations. In addition to overall audit and attest services, she regularly assists clients with federal grant compliance, internal control questions, agreed-upon procedures, new accounting standards implementation, and compliance with the requirements of the Government Finance Officers Association (GFOA) Certificate of Achievement for Excellence in Financial Reporting Program. She also has significant experience with Single audits of federal grant awards and is familiar with the requirements of the Uniform Guidance. Marcie has conducted presentations on new accounting standards and pronouncements, risk management, developing financial policies and procedures, financial reporting and Single Audits for the American Institute of CPAs (AICPA), Colorado Government Finance Officers Association (CGFOA) and BKD's public sector seminars. She also has developed training specific to grants management. She is a member of the AICPA, Colorado Society of CPAs and participates in the AICPA's Enhanced Oversight Program for Single Audits. Marcie serves on the Public Sector Center of Excellence, an internal committee of leaders across the firm who discuss a variety of issues important to public sector clients. She also serves on various BKD internal inspection teams, and external peer review teams. Marcie is a graduate of BKD's SKY initiative, which supports the development of women in the public accounting industry and is a graduate of the Praxity Emerging Leaders Academy. Marcie is a 2004 magna cum laude graduate of University of Northern Colorado, Greeley, with a B.S. degree in business administration with an emphasis in accounting. As of April 2022, she has completed approximately 231.5 hours of CPE in the past three years. 15 BKD CPE Courses Marcella D. Ardan, CPA Date CPE Course Completed Hours 01/05/2021 AICPA Peer Review Must-Select Industry: Government- Governmental 2.5 Auditing Standards 01/14/2021 Shedding Light on Your Single Audit: 2020 Compliance Supplement& 1 Updates (EW-2223) 02/24/2021 GASB Fiduciary Activities: What to Look For(IW-2258) 1.5 02/24/2021 Using Data Analytics to Reduce Fraud Risk(EW-2246) 1 03/11/2021 2021 Higher Education R3 Summit: Risks. Regulations. Reputation. (VC- 4.5 2233) 04/20/2021 Examining the American Rescue Plan Act: Impacts to the Public Sector 1 (EW-2287) 05/21/2021 Using the Work of Internal Audit: Update to BKD Policy (IW-2348) 1 06/10/2021 Considerations for Demonstrating &Achieving Diversity in Higher 1 Education (EW-2310) 06/14/2021 HEERF Programs: Use of Funds and Common Questions 1.5 07/16/2021 2021 Single Audit Update (IW-2392) 1.5 07/21/2021 2021 Nonprofit, Higher Education, & Public Sector Virtual Industry 4 Session (IW-2268) 07/23/2021 2021 Virtual Conference 16.5 08/02/2021 Leases Module 1: Overview of Lessee Accounting (Self-Study)) 1 08/06/2021 Leases Module 2: Effective Dates, Scope, & Definition (Self-Study) 0.5 08/10/2021 Leases Module 4: Transition (Self-Study) 1 08/10/2021 Leases Module 3: Core Concepts (Self-Study) 1 08/13/2021 Leases Module 6: Special Issues (Self-Study) 0.5 08/13/2021 Leases Module 7: Auditing Considerations - Lessee Accounting (Self- 0.5 Study) 08/17/2021 AICPA& CIMA 2021 Governmental Accounting &Auditing Online 15 Update 08/20/2021 Pulling it All Together-A Refresher on Certain COVID-19 Funding A&A 1 Considerations (IW-2429) 08/23/2021 keynet SharePoint Online &Teams Collaboration Training (Self-Study) 0.5 08/26/2021 2021 Virtual Public Sector Seminar: Tips for Leading in a Hybrid Work 1 Environment (EW-2411) 08/26/2021 2021 Virtual Public Sector Seminar: Economic Update (EW-2410) 1 08/26/2021 2021 Virtual Public Sector Seminar: How Much Are Your Ethics Worth? 2 (EW-2412) 09/08/2021 State & Local Government Client Affiliates (Self-Study) 0.5 09/17/2021 Audit Innovation Tech Update (IW-2474) 1 09/24/2021 2021 Compliance Supplement & Single Audit Update Encore 1 Presentation (EW-2488) 10/21/2021 Winning at All Costs: Case Studies in Behavioral Ethics (IW-2511) 1 16 BKD Marcella D. Ardan, CPA Date CPE Course Completed Hours 10/22/2021 Journal Entry Testing (IW-2517) 1 11/03/2021 Nonprofit Higher Education & Public Sector Industry Leader Training 6.5 (LC21) 11/04/2021 Audit General Session (LC21) 4 11/04/2021 Audit: GASB Update (LC21) 1 11/04/2021 Audit: Areas of Firm Focus in Audit Innovation &Audit Methodology 1 (LC21) 11/05/2021 Annual Partner-Managing Director Business Meeting (LC21) 2.5 11/05/2021 General Session (LC21) 4 12/06/2021 ESG: Why Your Organization Should Care & How to Get Started (EW- 1 2519) 12/10/2021 Lessons Learned from Litigation (When other CPA Firms Get Sued) (IW- 1 2582) 12/10/2021 GASB Leases (IW-2583) 1.5 01/17/2020 Your Role in Improving Client Payments 1 02/03/2020 Avoiding the 10 Worst Habits of Otherwise Good Leaders 1 02/14/2020 Higher Education R3 Summit: Risks. Regulations. Reputation. (EL-1737) 4 03/02/2020 The Proper Way to Build a Business Network 1 04/07/2020 Higher Education &the CARES Act(EW-1911) 1 04/20/2020 Understanding and Improving Firm Processes 1 04/29/2020 Clearing the Air: Quick Updates on Public Sector COVID-19 Changes 1 (EW-1930) 05/29/2020 2020 Single Audit Update (IW-1956) 1 06/11/2020 SKY Professional Development Series: 50 Ways to Fight Bias (IL-1746) 2 06/17/2020 Virtual LC20 General Session (IW-1975) 1.5 06/22/2020 Client Management: Selecting and Keeping the Right Clients 1 06/24/2020 BKD Materiality Methodology Training (V-1990) 4 07/12/2020 A&A Response to COVID-19 (Self-Study) 1 07/29/2020 New Borrower Defense Rules: A Deeper Dive into Regulations & 1 Reporting Requirements (EW-2027) 08/20/2020 2020 Virtual Public Sector Seminar(VC-2045) 4 08/27/2020 Implementing the CARES Act Coronavirus Relief Fund for State and 2 Local Governments in the Field of Management 09/17/2020 2020 Single Audit Update - Part 2 (IW-2107) 1 09/29/2020 Digital Transformation in 2020: Making the Most of Remote Work(EW- 1 2099) 10/22/2020 2020 Governmental Conference 8 11/05/2020 2020 A&A Annual Update- Core Concepts Update (IW-2121) 2 11/05/2020 2020 A&A Annual Update (IW-2121) 3.5 17 BKD Marcella D. Ardan, CPA Date CPE Course Completed Hours 11/10/2020 Independence at BKD (Self-Study) 1 11/12/2020 Introhive (Self-Study) 0.5 11/20/2020 Managing Engagements-The Engagement Management Dashboard 1 (I W-2166) 12/08/2020 Tales From the BKD Vault- Case Studies in Behavioral Ethics (Self- 1 Study) 12/10/2020 Top 10 Plus Ethical Challenges that Could Jeopardize Your Career(IW- 1 2198) 12/10/2020 Statement of Cash Flows: Common Errors & How to Find Them (IW- 1 2199) 01/11/2019 IT Security Awareness - Mobile Device Security 0 01/22/2019 Helping to Make Client Transitions Successful 1 02/12/2019 Setting and Accomplishing Worthwhile Goals 1 02/15/2019 Higher Education R3 Summit: Risks. Regulations. Reputation. (EL-1386) 4 03/22/2019 Providing Exceptional Client Service 1 04/04/2019 Public Investment and Debt Management Forum 7 04/26/2019 Committing to a Personal Business Development Plan 1 05/09/2019 Grant Compliance-Avoiding Common Pitfalls (EW-1467) 1.5 05/17/2019 The 2018 Yellow Book: What Changes Do You Need to Know About? 1 (IW-1517) 06/17/2019 Learning to Give and Receive Constructive Feedback 1 06/18/2019 Accounting for Fiduciary Activities: GASB 84 (EW-1524) 1 07/09/2019 Not-for-Profit&Government-Tuesday-Track 1 (LC19) 4 07/09/2019 General Session (LC19) 3 07/10/2019 Not-for-Profit&Government-Wednesday-Track 1 (LC19) 2 07/15/2019 First Southern Bank-A Case Study in Behavioral Ethics (Self-Study) 1 07/16/2019 NACUBO 2019 Annual Meeting 10.5 08/13/2019 Governmental Accounting and Auditing Update Conference 2019 18 08/16/2019 AICPA Peer Review Must-Select Industry Update: Governmental - 3 Government Auditing Standards 08/16/2019 Praxity ELA Year 2 Conference 2019 13 08/20/2019 2019 BKD Public Sector Seminar(EL-1526) 7 10/18/2019 GASB 84 - Fiduciary Activities Update (IW-1717) 1 11/08/2019 2019 A&A Annual Update (IL-1687) 5.5 11/15/2019 Effective Delegation: How Leaders Help Others Grow 1 11/22/2019 Proposals, Client Acceptance and Engagement Letters (contracts)- 1 Changing BKD's Process (IW-1767) 12/03/2019 Giving Feedback 2 18 BKD Marcella D. Ardan, CPA Date CPE Course Completed Hours 12/13/2019 2019 Single Audit Update (Self-Study) 1.5 12/13/2019 TeamMate Analytics Overview, Sampling &Journal Entry Testing (IW- 1 1808) '] Taylor Williamson, CPA Manager Engagement Role: Audit Manager ` Taylor joined BKD in 2017. He provides audit services to a variety of clients. He is a 2015 graduate of Oklahoma State University, Stillwater, with a bachelor's degree in 11116 accounting and a 2017 graduate of University of Colorado, Boulder, with an M.Acc. degree. As of April 2022, he has completed approximately 165 hours of CPE in the past three years. CPE Courses Taylor Williamson Date CPE Course Completed Hours 02/25/2021 Wrapping Up Audits Tips & Best Practices 1 04/16/2021 2021 Employee Benefit Plan Annual Update (IW-2285) 2 05/11/2021 2021 Single Audit In-Charge (IW-2282) 7 05/21/2021 2021 Annual AICPA Employee Benefit Plan Conference Update (IW- 1 2344) 05/21/2021 Using the Work of Internal Audit: Update to BKD Policy (IW-2348) 1 06/04/2021 Single Audit Basics 2021 3 06/28/2021 Governmental Accounting Basics 2021 2 07/16/2021 2021 Single Audit Update (IW-2392) 1.5 07/27/2021 Independence at BKD (Self-Study) 1 07/27/2021 Leases Module 1: Overview of Lessee Accounting (Self-Study)) 1 07/27/2021 Leases Module 3: Core Concepts (Self-Study) 1 07/27/2021 Leases Module 2: Effective Dates, Scope, & Definition (Self-Study) 0.5 07/28/2021 Leases Module 4: Transition (Self-Study) 1 08/17/2021 How to Streamline the Financial Reporting Process 3.5 08/25/2021 2021 Virtual Public Sector Seminar: Economic Update (EW-2410) 1 08/26/2021 2021 Virtual Public Sector Seminar: How Much Are Your Ethics Worth? 2 (EW-2412) 08/26/2021 2021 Virtual Public Sector Seminar: Tips for Leading in a Hybrid Work 1 Environment (EW-2411) 09/17/2021 Audit Innovation Tech Update (IW-2474) 1 09/21/2021 2021 Compliance Supplement& Single Audit Update (EW-2437) 1 19 BKD Taylor Williamson Date CPE Course Completed Hours 09/30/2021 keynet SharePoint Online &Teams Collaboration Training (Self-Study) 0.5 10/06/2021 2021 Level 5 21.5 10/22/2021 Winning at All Costs: Case Studies in Behavioral Ethics (IW-2511) 1 10/22/2021 Journal Entry Testing (IW-2517) 1 11/19/2021 2021 A&A Annual Update- General Session (IW-2548) 4 11/19/2021 Recognizing Fraud & Fraud Risks (IW-2549) 1 11/19/2021 LeaseVision & Other Lease Tools (IW-2550) 1 11/19/2021 Understanding & Leveraging BKD's Audit Technology Tools (IW-2551) 1 12/06/2021 ESG: Why Your Organization Should Care & How to Get Started (EW- 1 2519) 12/10/2021 Lessons Learned from Litigation (When other CPA Firms Get Sued) (IW- 1 2582) 12/10/2021 GASB Leases (IW-2583) 1.5 01/08/2020 Teammate Analytics (IL-1769) 2.5 04/16/2020 2020 Employee Benefit Plan Annual Update (IW-1922) 3 05/13/2020 Act on the Important: Choice 1 of the 5 Choices to Extraordinary 1 Productivity 05/28/2020 Proposals, Client Acceptance and Engagement Letters (contracts) - 1 Changing BKD's Process (Self-Study) 05/28/2020 TeamMate Analytics Overview, Sampling &Journal Entry Testing (Self- 05/28/2020 Study) 06/09/2020 Go for Extraordinary: Choice 2 of the 5 Choices of Extraordinary 1 Productivity 06/11/2020 Schedule the Big Rocks: Choice 3 of the 5 Choices to Extraordinary 1 Productivity 06/12/2020 Rule Your Technology: Choice 4 of 5 Choices of Extraordinary 1 Productivity 06/12/2020 Fuel Your Fire: Choice 5 of the 5 Choices to Extraordinary Productivity 1 06/12/2020 Business Development for BKD Senior Associates 0.5 06/16/2020 SKY Professional Development Series: 50 Ways to Fight Bias (IL-1746) 2 06/16/2020 Virtual LC20 General Session (IW-1975) 2 06/19/2020 Not-for-Profit Basics 3 07/01/2020 A&A Response to COVID-19 (Self-Study) 1 07/16/2020 BKD Materiality Methodology Training (V-1990) 4 08/13/2020 BKD's Guide to Public Sector Accounting: Single Audit Testing Basics 1 08/21/2020 2020 Single Audit Update (Self-Study) 1 09/10/2020 Telecom Regulatory Update: What You Need to Know (EW-2016) 1 09/17/2020 Redefining BKDconnect-Tips and Tricks on Increasing Functionality 1 (IW-2111) 20 BKD Taylor Williamson Date CPE Course Completed Hours 09/17/2020 2020 Single Audit Update - Part 2 (IW-2107) 1 10/07/2020 BKD Culture- Unmatched Client Service 2.0 (Self-study) 1 10/14/2020 BKD's Guide to Public Sector Accounting: AWP 305- Evaluation of 1 Potential Deficiencies in Internal Control 10/27/2020 2020 Audit Level 4 19.5 11/04/2020 2020 A&A Annual Update- Core Concepts Update (IW-2121) 2 11/05/2020 2020 A&A Annual Update (IW-2121) 3.5 12/09/2020 GASB 68: Pensions & GASB 75: Other Post-employment Benefits 1 (OPEB)- an Overview& Best Practices 12/10/2020 Top 10 Plus Ethical Challenges that Could Jeopardize Your Career(IW- 1 2198) 12/10/2020 Statement of Cash Flows: Common Errors & How to Find Them (IW- 1 2199) 01/15/2019 IT Security Awareness - Mobile Device Security 0 04/18/2019 2019 Employee Benefit Plan Annual Update (V-1450) 2 05/09/2019 Colorado Board of Accountancy Statutes, Rules and Regulations 2 08/07/2019 2019 Annual AICPA Employee Benefit Plan Conference Update (Self- 1 Study) 08/16/2019 Ethics in the Real World - BKD and Beyond (IW-1642) 1 10/16/2019 2019 Audit Level 3 25.5 11/01/2019 2019 A&A Annual Update (IL-1687) 5.5 21 BKD Additional Resources Lindsey D. Oakley, CPA Partner Lindsey, a member of BKD National Public Sector Group, currently serves in BKD's National Office accounting and auditing department, where she provides technical support to auditors, o� ,,� implements new professional standards and performs concurring reviews on engagements. �� ' She also serves as the firmwide government and nonprofit technical coordinator. She joined the National Office in 2012 after working in the Springfield, Missouri, office where she provided audit and consulting services for nonprofit organizations, governmental entities and real estate companies. Lindsey is a member of the American Institute of CPAs (AICPA)and Missouri Society of CPAs. She serves on the Executive Committee of the AICPA Governmental Audit Quality Center. Lindsey is a 2004 cum laude graduate of Missouri State University, Springfield, with a B.A. degree in accounting, and in 2005 received an M.Acc. degree. „ - Amy K. Shreck, CPA Director • Amy is a member of BKD National Public Sector Group and has more than 13 years of experience working with governmental entities, nonprofits and higher education institutions. 'CZ11 She leads the BKD Public Sector Center of Excellence, an internal committee of leaders across the firm who discuss a variety of issues important to the public sector. She recently • completed a two-year term as a practice fellow with GASB at its headquarters, where she helped to formulate standards and assisted with technical inquiries. Amy's experience at GASB allows her to help clients better understand GASB standards and the thought process behind the standards. Amy is a member of the American Institute of CPAs and Nebraska Society of Certified Public Accountants. She also is a frequent presenter at the Great Plains chapter of GFOA conferences, speaking on financial reporting changes, including new GASB statements and projects. She is a graduate of Leadership Omaha Class 37. She previously served on the Goodwill Industries Serving Southeast Nebraska board of directors and the University of Nebraska-Lincoln School of Accountancy Junior Advisory Board. She currently serves on the Nebraska BKD Foundation Advisory Committee. Amy is a graduate with highest distinction of University of Nebraska-Lincoln with a B.S. degree in business administration and an M.P.A. degree. Continuing Professional Education Our audit professionals are required to receive at least 120 hours of CPE every three years. For auditors involved with audits performed under Government Auditing Standards, this education includes the hours required to comply with Government Auditing Standards Yellow Book guidance. All individuals, including specialists involved in performing fieldwork on Government Auditing Standards audits, are required to obtain at least 24 hours of CPE every two years in subjects directly related to government auditing or the government environment. In addition, engagement team members responsible for planning, directing or reporting on Government Auditing Standards audits who spend more than 20 percent of their time performing Government Auditing Standards audits also are required to complete a minimum of 80 hours of CPE every two years that directly enhances their professional proficiency to perform audits. 22 BKD BKD offers an internal industry update seminar for managers through partners, as well as a seminar for our in- charge level employees. These seminars include auditing and accounting issues that are specific to governmental clients, including Government Auditing Standards, Single Audits and accounting standards for government financial reporting. BKD professionals also receive additional training from external sources. Recognized Learning & Development For the ninth consecutive year, BKD has ranked among Training magazine APEX Award winners (formerly the Training Top 100). We also have received Chief Learning Officer magazine's LearningElite award since 2016, including either Gold- or Silver-level recognition since 2018. These programs rank an organization's excellence in employer-sponsored training and recognize outstanding outcomes in learning and development. Staff Continuity Whenever possible, we keep a consistent engagement team for our clients. This helps reduce the learning curve and saves the time, frustration and disruption of dealing with new advisors unfamiliar with their organization. Past experience is a primary determinant for assigning professionals to engagements, and we will assign individuals who are experienced in working with public sector entities for City of Dubuque's engagement. Though it is impossible for any firm to know the future career paths of its professionals, many of our clients maintain the same underlying BKD engagement team for years. Engagement partners,managers,other supervisory staff and specialists may be changed if those personnel leave the firm,are promoted or are assigned to another office. These personnel may also be changed for other reasons with the express prior written permission of the City of Dubuque. However, in either case,the City of Dubuque retains the right to approve or reject replacements. Consultants and firm specialists mentioned in response to this RFP can only be changed with the express prior written permission of the City of Dubuque,which retains the right to approve or reject replacements. Other audit personnel may be changed at the discretion of the proposer provided that replacements have substantially the same or better qualifications or experience. In the event we are required to make a change to any key personnel assigned to your engagement, we will discuss this with you to explain the circumstances and proposed change. Your lead engagement partner, Jessica Richter, will be coordinating personnel changes. We generally do not remove key personnel from an audit once it has begun, but occasionally employee turnover or other events beyond our control require such a change. If a personnel change is required, we are confident we can provide a qualified replacement to complete your audit with limited interruption. We understand engagement team members, consultants and firm specialists mentioned in our response to this RFP can only be changed with the prior express written permission of City of Dubuque, which retains the right to approve or reject replacements. 23 BKD 6. Similar Engagements with Other Government Entities For the firm's office that will be assigned responsibility for the audit, list the most CONFIDENCE significant engagements(maximum—5) performed in the last three years that are similar to the engagement described in this RFP. These engagements should be ranked on the basis of total staff hours. Indicate the scope of work,date, "BKD has been the best accounting firm I have used— engagement partners,total hours,and the name and telephone number of the helpful,reliable and principal client contact. responsive. They are terrific at facilitating a schedule that References* allows our audit to be completed within the Our clients are our best ambassadors, and we encourage you to contact them established timelines and about their satisfaction with our services. The following clients have consented to commitments." discussing BKD's services and service delivery with you at your convenience. "BKD asks questions early and Citydiscusses complicated issues of West Des Moines, IA before the audit begins,which Scope of Work: Financial statement audit and Uniform Guidance audit facilitates a more efficient Date:June 30, 2021 audit. They establish a great Engagement Partner: Jessica Richter two-way dialogue to address Total Staff Hours:490 challenges and intricacies that occur during the audit Mr.Tim Stiles, Finance Director process." 515.222.3611 tim.stiles@wdm.iowa.gov Cherie Sanchez West Des Moines, IA Accounting Manager City of Westminster,Colorado Dordt University Scope of Work: Financial statement audit and Uniform Guidance audit Date:June 30, 2021 Engagement Partner:Jessica Richter Total Staff Hours:464 Ms. Stephanie Baccam,Vice President of Finance & Risk Management 712.722.6014 stephanie.baccam@dordt.edu Sioux Center, IA American Academy of Family Physicians Scope of Work: Financial statement audit and Uniform Guidance audit Date: May 31, 2021 Engagement Partner:Jessica Richter Total Staff Hours:439 Ms.Jenny Clemons, Controller 913.906.6191 jclemons@aafp.org Leawood, KS 24 BKD Representative Lists of Clients* In addition to the references above, BKD is proud to work with municipalities, including: City&County of Denver, CO^ City of Lubbock,TX^ City of Arvada, CO^ City of McKinney,TX^ City of Aurora, CO^ City of Mesquite,TX^ City of Balch Springs,TX City of Nebraska City, NE City of Bellevue, NE City of Norman, OK City of Bentonville,AR^ City of Phoenix,AZ^ City of Brookings, SD^ City of Ralston, NE City of Colorado Springs, CO City of Roanoke,TX^ City of Conway, AR City of Springdale, AR City of Fort Smith, AR City of Texarkana,AR^ City of Greenville,TX^ City of Westminster, CO^ City of Kerrville,TX^ Consolidated City of Indianapolis—Marion County, IN" City of Lancaster,TX Jackson County, MO^ City of Lawton, OK Sedgwick County, KS City of Liberty, MO^ Town of Addison,TX^ City of Lincoln, NE^ Town of Highland Park,TX" City of Little Rock,AR^ ^Denotes client who earned recognition under GFOA's COA Program. BKD also is proud to work with airports, including: Beatrice Municipal Airport Greenville-Spartanburg International Airport Bentonville Municipal Airport Harrisburg International Airport Bill and Hillary Clinton National Airport Indianapolis International Airport Brookings Regional Airport Kansas City International Airport Centennial Airport Lincoln Airport Colorado Springs Municipal Airport Midland International Airport Conway Municipal Airport Minneapolis/St. Paul International Airport (Large Denver International Airport (Large hub) hub) El Paso International Airport Orlando Sanford International Airport Erie International Airport Phoenix Sky Harbor International Airport (Large Fayetteville Municipal Airport hub) Fort Smith Regional Airport San Diego International Airport (Large hub) Fort Wayne International Airport Springdale Municipal Airport We serve clients in all 50 states & internationally. 25 BKD 7. Specific Audit Approach The proposal should set forth a work plan,including an explanation of the audit methodology to be followed,to perform the services required in Section II of this RFP. In developing the work plan,reference should be made to such sources of information as City of Dubuque's budget and related materials,the organizational chart, manuals and programs,and financial and other management information systems. Financial Statement Audit in Accordance with Government Auditing Standards & the Uniform Guidance What is an Audit? Auditing standards set the technical requirements for our process, culminating the expression of our opinion on the presentation of your financial statements. Our audit will be performed in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. What is an Audit Experience? While auditor selection should start with evaluating technical competence, it also should extend to your expectations for a service experience. Your audit experience includes how your engagement is managed, how you and your team are treated, the quality and timeliness of communication you receive and your confidence in the results and guidance you receive. We want you to consider our philosophy around independence, integrity and quality, along with our commitment to Unmatched Client Service and the strength of your proposed engagement team. The BKD Differences That Matter Our people are key components of what differentiates a BKD audit. Through intentional training and our People firm culture,our teams integrate a commitment to quality with an appreciation for client needs and expectations. We also bring relevant industry experience,which means you will not be required to train our staff. The engagement executive managing your audit will maintain a high level of involvement with Leadership City of Dubuque by delegating appropriate tasks to other audit team members as needed while remaining engaged with you and the audit team. Our engagement executives are on site and participate in the supervision and delivery of your audit. Challenging matters or simple misunderstandings can arise,and they shouldn't be ignored. While our responsibility is to issue an appropriate opinion on your financial statements,it is important for us to help Communication keep your team informed of issues as they occur and recommend the appropriate solution. Our philosophy is to be courteous and professional,communicate efficiently and make reasonable requests. We are committed to treating you and your team with candor and respect. Technology plays a significant role in our audit as we leverage tools to enhance effectiveness and efficiency. We invest heavily in improving workflows and increasing our audit data analytics capabilities. Technology In addition to traditional tools such as Excel,we also use more advanced solutions like TeamMate Analytics,Galvanize,Alteryx,Kira and MindBridge,among others. These technologies,combined with our secure portal,help improve our results,enhance your experience and increase the insight we can provide. 26 BKD Onboarding & Project Management Your BKD audit experience starts as soon as you select us. Our priorities include building rapport with your team, developing a deeper understanding of your operations and collaborating with you on the design and expectations of our service relationship. These efforts are part of the BKD Smooth Transition TM approach. The proposal process has provided us with the basics of your organization, but learning more will help us serve you better. If not already completed, we will finish the details of client acceptance to confirm what we have learned and verify confidential information not already obtained, such as litigation history or other sensitive matters. We will address various elements of project management with you, including how you will use BKDconnect Client Sites, our secure portal, to exchange and track information, the key dates of our processes and refinements to the details discussed in this proposal. We will schedule the BKD connect { Client Sites professionals outlined in this proposal and coordinate with your team on details, such as timing of visits to your location and discussions with your leadership. Proposed Timeline Engagement Phase Timing Planning & Interim Procedures, including Predecessor Auditor Procedures June—August 2022 Compliance Audit Testing August-October 2022 Testing Procedures (Fieldwork) September/October 2022 Presentation to Those Charged with Governance December 2022 Executing the Audit Once we have established our overall process and communication plans with you, the detailed work can begin. Key elements of that work include: Risk Assessment We will identify and assess risks of material misstatement in your financial statements, including those from potential fraud. Our work is supported by building a strong understanding of your business environment through documents you provide and by gathering information through interviews and tests for significant transaction cycles. Audit Design Based on risks identified, we will design an audit approach specific to your organization. This tailoring takes into consideration the uniqueness of your operations, the design of internal controls you have implemented and the nature of financial statement amounts and disclosures. We consider whether matters are truly important (materiality), as well as obtain input about concerns from management and city council to design the tests we will perform. Gathering Evidence Once the plan is complete, we will execute the audit through a combination of on- and off-site work performed in accordance with the agreed-upon timeline. 27 BKD Reviewing the Work Critical to our process is a review of the team's work by our engagement executive, as well as a quality review by another executive who is independent from the detailed work. The quality review is designed to improve our deliverable by providing a fresh perspective and reinforcing quality. Sharing Our Results We base our audit opinion on the evidence gathered and then communicate our findings. Professional standards drive the content of our opinion and the required communication about any deficiencies and other items we may identify during the audit. Beyond these requirements, we share results formally through our letters and presentations to management and city council, as well as opportunities for improvement through conversations during the audit process. Compliance Audit in Accordance with the Uniform Guidance BKD performs hundreds of Single Audits annually, focusing on two objectives: first, an audit of your financial statements and reporting on the Schedule of Expenditures of Federal Awards (SEFA) in accordance with Government Auditing Standards, and second, a compliance audit for federal awards expended during the fiscal year in accordance with the Uniform Guidance. As mentioned, approximately one-third of our nonprofit and governmental clients receive federal funding. Our extensive experience with compliance testing in accordance with OMB requirements can help provide City of Dubuque with a Single Audit performed properly and submitted on time. Our Approach During our audit procedures of federal award programs, we do not simply look for findings to report. We look for opportunities to advise you of more efficient ways to comply with federal regulations to reduce the risks of sanctions or reduced funding. BKD has developed contacts at federal agencies and has been able to work cooperatively with these agencies to help clients resolve or avoid issues. Entities subject to the Uniform Guidance and Government Auditing Standards will benefit from BKD's specially designed audit programs, checklists and database of federal audit programs. Identification and testing of your federal programs will be performed primarily during interim fieldwork, which will typically be performed before your fiscal year-end. We have found this to be the most efficient manner in which to perform our audit services when the additional Uniform Guidance requirements are present. Training Requirements for Single Auditors City of Dubuque can have confidence in BKD auditors' experience in testing federal funding subject to the Uniform Guidance. As mentioned, our audit professionals are required to receive at least 120 hours of CPE every three years, and for auditors involved with audits performed under Government Auditing Standards, this education includes the hours required to comply with Government Auditing Standards Yellow Book guidance. Staff members attend a series of core audit and accounting courses over the first four years of their careers. Staff subsequently receive additional training on accounting and auditing for the nonprofit and governmental environment. 28 BKD HUD Agreed-Upon Procedures We will perform the procedures required to complete your electronic submission of audited financial information to HUD. We will apply the following procedures to the HUD Real Estate Assessment Center(REAC) electronic submission as of and for the year ending June 30, 2022, in accordance with attestation standards established by the AICPA and the standards applicable to attestation engagements contained in Government Auditing Standards issued by the Comptroller General of the United States. The sufficiency of the requested procedures is solely the responsibility of the specified users of our report, City of Dubuque and REAC. Consequently, we make no representation regarding the sufficiency of the procedure for which the report has been requested or for any other purpose. We will compare the following areas of electronic submission with the corresponding printed documents and indicate whether those items are in agreement: UFRS Rule Information Hard Copy Documents Balance sheet, revenue, expense &cash flow data (account Financial Data Templates, i.e., numbers 1120 to 7100T&the S1200 series) Supplemental Schedules Surplus cash (S1300 series accounts) Financial Data Templates, i.e., Note: Cooperatives are exempt from submitting surplus cash computation of surplus cash, accounts distributions & residual receipts (annual) Footnotes (S3100 series of accounts) Footnotes to audited basic financial statements Type of opinion on the financial statement&compliance (account Auditor's reports on the financial number S2100-020, S2300-020) statements & compliance Type of opinion on financial data templates, i.e., Supplemental Auditor's supplemental report on Data, (account number S2100-100) financial data templates Audit findings narrative (S2700 series of accounts) Schedule of findings & questioned costs Because we have not been engaged to conduct an examination or a review, we will not express an opinion or conclusion on the electronic submission. In addition, we have no obligation to perform these procedures beyond those listed above. This procedure will not include a detailed examination of all transactions and cannot be relied upon to disclose misstatements that might exist due to error, fraud or instances of noncompliance. However, we will inform you of any such matters, if material, that come to our attention. We will submit a report summarizing the procedures performed and their results. This report is intended solely for the information and use of City of Dubuque and REAC and should not be used by anyone other than these specified parties. 29 BKD Our Work with the Passenger Facility Charge Program Our approach to auditing Dubuque Regional Airport's PFC program is similar to our approach to auditing federal award program compliance under Single Audit requirements. Because of our extensive airport experience, BKD is knowledgeable of the compliance requirements that are unique to the PFC program. Accordingly, BKD has developed an audit program that is specifically designed for testing the PFC program and follows the guidelines prescribed in the Federal Aviation Administration's Passenger Facility Charge Audit Guide for Public Agencies (PFC Audit Guide). During the planning phase of the PFC program audit, we will complete the following steps: ► Review the PFC Audit Guide for any changes ► Review the Code of Federal Regulations for any changes to the PFC program or its audit requirements ► Discuss with management any changes to the internal control environment that may have an effect on the collection and disbursement of PFC funds ► Review any amendments to Dubuque Regional Airport's open Records of Decision Any changes in the information collected above are taken into consideration, and appropriate modifications are made to our PFC audit program prior to the start of testing. This facilitates the planning process and helps to avoid surprises. Our Work with the Airport Improvement Program BKD maintains ongoing contact with government agencies such as the U.S. Department of Transportation, Federal Aviation Administration and Department of Homeland Security by frequently reaching out directly to these agencies if questions arise when auditing federal programs they administer. In addition, we work cooperatively with these contacts to help resolve or avoid issues for our clients. Our interaction with these and other federal agencies and the federal Office of Inspector General has provided BKD with opportunities to participate in the revision of the suggested audit steps contained in Uniform Guidance, including those pertaining to the AlP. Because of our active involvement in Airports Council International, the Association of Airport Internal Auditors and the American Association of Airport Executives, we also are privy to presentations made by federal agency representatives. Our airport experience is strengthened by our extensive familiarity with both the PFC program (audited in accordance with the PFC Audit Guide) and the AIP (CFDA No. 20.106—audited in accordance with Single Audit requirements). The depth and breadth of our work with airports around the country has allowed us to develop audit programs tailored specifically to the compliance requirements of these unique programs. We understand these and other federal programs unique to the airport industry and know how to audit them. LEADERSHIP "BKD,LLP demonstrated excellent customer service in meeting our needs. Their technical knowledge was excellent and extremely valuable to our organization. I highly recommend them to any governmental entity." Clint Mercer Chief Accountant City of Norman,Oklahoma 30 BKD Broad Audit Risk Considerations Some risk considerations apply across nearly all of our audits. We pay particular attention to the following items: Significant Accounting Estimates Nearly all financial statements have significant estimates in amounts and disclosures, even when not readily apparent. Estimates may include amounts ultimately collectible from third parties, expected losses or costs occurring at a specific amount and time, etc. We will gather information supporting management's estimates and challenge key assumptions used to develop these amounts. We also will test estimates on available data and historical trends and document our conclusions on the reasonableness of recorded amounts. Risk of Management Override of Controls When considering fraud, auditing standards require evaluating the risk that management could override existing controls. We will perform interviews of selected individuals, apply an element of unpredictability in our testing and brainstorm as a team to evaluate risks and possible actions based on our observations. We also will perform journal entry testing, review estimates for bias and significant changes and consider the business rationale for significant unusual transactions. Procedures & Risks Specific to the Public Sector Audit procedures can vary, but they often include traditional observation, sampling and testing combined with more advanced deployment of technology for trend analysis, summarization of documents and assessment of large data sets. Our work with hundreds of clients in the public sector means our advisors are very familiar with entities similar to City of Dubuque. While no two audits are the same, certain activities are common to governmental entities. Specific risk areas for City of Dubuque are likely to include: Investments This is a significant audit area due to the risks associated with the proper and timely valuation of investments. We employ a variety of audit procedures in this area, including the use of third-party confirmations, obtaining an understanding of management's assessment of fair values, fair market value testing to published sources and obtaining SOC 1 reports. In addition, we evaluate the disclosure requirements and the adequacy of completeness and accuracy of the disclosures. Accounts Receivable & Deferred Inflows of Resources & Unearned Revenue These areas often are a significant risk due to the subjective nature of City of Dubuque's estimate for the allowance for doubtful accounts and the proper recognition of revenue for funds that report using the modified accrual basis of accounting and the current financial resources measurement focus that is consistent with City of Dubuque's policy. We will test the cutoff of various revenue sources, such as taxes, government grants and customer utility accounts, and review the revenue journal both before and after year end. We may confirm significant accounts receivable, as well as a sample of others to test both existence and proper classification, if considered necessary. In addition, we will test deferred inflows of resources by reviewing subsequent collections and perform various analytical procedures to test both completeness and proper classification of the balances, consistent with City of Dubuque's policy of recognizing revenue on the modified accrual basis of accounting. Revenue Recognition Professional standards include a rebuttable presumption that for each audit, there is a risk of material misstatement due to fraud relating to improper revenue recognition. Our approach is to gain an understanding of the revenue recognition criteria and policies and then perform a variety of inquiry, analytical and substantive audit procedures to confirm our understanding. 31 BKD Capital Assets We will audit the capital asset rollforward activity of each opinion unit, focusing on significant additions and disposals during the year. Current-year additions will be tested to appropriate supporting documentation. A review of repair and maintenance accounts will be performed to help identify whether material additions have been capitalized. New lease agreements will be reviewed to identify whether they have been accounted for properly. Depreciation expense also will be tested for reasonableness, and certain analytical procedures will be performed on the capital outlay line items for governmental funds associated with the conversion to government- wide reporting. Net Position/Fund Balances Procedures we perform in this area include vouching (or cross-indexing to work performed in other areas) of significant increases and decreases to net position, recalculation of net investment in capital assets for enterprise funds and governmentwide activities, review of documentation supporting the establishment and classifications of new accounts and testing of various nonspendable, restricted, committed and assigned fund balance accounts based on supporting documentation of donor and grantor agreements, enabling legislation, formal actions of city council, such as ordinances and resolutions and other formal policies. Uniform Guidance Testing We will discuss with management and review the preliminary SEFA as of an interim date to identify the likely major programs for testing. We will perform the majority of our testing prior to year-end and will share our results with you prior to final fieldwork. During final fieldwork, we will assess whether there are any additional major programs that would require testing and conclude our compliance and internal control procedures related to the Uniform Guidance expenditures in agreement with the conclusion of the audit of the financial statements. Utility Receivables & Unbilled Revenues We will use several methods to audit your receivables and the estimate of unbilled revenues, including using look- back reports, reviewing historical collection methods and assessing of the aging and payor mix of your accounts receivable detail. We will analytically review key ratios such as days in accounts receivable and charge-off rates compared to industry averages and prior year results to help us reach our audit conclusions. We will work with your team before year end on the allowance to see that we understand your methodologies and conclusions. Finally, we use data analysis software to test subsequent billings and receipts and the accuracy of revenue cutoff to help validate the year-end accounts receivable balance and any unbilled revenue amounts. Pensions & Other Postemployment Benefit Obligations Due to the subjective nature of the estimation processes associated with determining the estimated Other Postemployment Benefit(OPEB)obligations liability, we will obtain and test the specific actuarial calculations for the OPEB liability. First, we will evaluate the professional qualifications and reputation of the actuary. We will read the actuarial reports to obtain an understanding of the methods and assumptions employed and evaluate the cost method used and the significant assumptions underlying the actuarial calculations. Select testing of the underlying data used in the calculation will be performed. We will evaluate the valuation, cost and amortization methods for consistency. The other significant underlying assumptions such as discount rates, rates of return and medical cost trends will be compared with independent external studies of assumptions by such noted organizations as Milliman Medical Index, SEI Pension Accounting Research Series and the Towers Watson annual health care trend survey. 32 BKD Long-Term Debt This is typically a risk due to the presence of one or more significant debt covenants. We review the associated debt documents to help gain an understanding of the flow of funds prescribed for any pledged revenues. We review the covenants and obtain evidence through inquiry and other means, including the recalculation of any financial covenants, to support the conclusion that all covenants have been met and all debt service payments have been made on time. We also will confirm the annual payment activity and ending balances of certain bonds, notes and leases payable with trustees. In the case of any refunded debt in the year being audited, we will recalculate the accounting gain or loss by reviewing trustee statements and bond documents to test for proper classification and footnote disclosures. We also will inquire about your policy on reviewing each bond and note for applicable IRS arbitrage requirements, prepare a list of bonds and notes subject to IRS arbitrage requirements and the most recent arbitrage calculation prepared for each bond and challenge the calculation performed to test for completeness and obligations of City of Dubuque. GASB's Updated Lease Standard With GASB Statement No. 87, Leases (GASB 87), the way leases are handled in public sector accounting has changed. While this rule is intended to provide clarity for users of financial statements, it brings a host of considerations for both lessors and lessees. Governmental entities will be allowed to transition using the facts and circumstances in place at the time of adoption, rather than retroactive to the time each lease was begun. Proposers will be required to provide the following information on their audit approach: a. Proposed segmentation of the engagement b. Level of staff and number of hours to be assigned to each proposed segment of the engagement Proposed Audit Segmentation Estimated Hours Staff Level Risk assessment procedures, including meetings with officials & staff, preliminary analytics, review minutes &design of audit 23 All Professionals procedures based on assessed risks Document&evaluate internal controls 15 Manager&Associate Obtain financial policies & procedures, bond documents, leases 5 Manager&Associate &grants &other items for our permanent file Substantive procedures & analytical review techniques 221 All Professionals Review prepared ACFR 20 All Professionals Single Audit testing 60 Manager&Associate Supervision, review& technical assistance 45 Partner/Manager Client conferences & meetings to review audit reports 15 Partner& Manager Reporting —Report to governance & management advisory 5 Partner& Manager comments c. Sample size and the extent to which statistical sampling is to be used in the engagement Although it is not possible to set absolute rules for identifying sample sizes, we apply our professional judgment in identifying the appropriate sample size. The objective is to test the population to obtain reasonable confidence that the test objectives have been met. Sample sizes are controlled by the following considerations: 33 BKD ► Tolerable error(precision)—as the expected monetary conclusion becomes more critical, sample size should increase to tighten the range of the extrapolated estimate ► Significance of the account to the financial statements—as the significance increases, sample size should increase ► Assessment of internal control risk—as assessed risk is reduced, sample size for substantive tests should decrease ► Extent of other substantive audit procedures related to same audit objective (tests of detail, as well as analytical review)—as the extent of other procedures increase, sample size should decrease ► Frequency and magnitude of expected errors—as the frequency and magnitude of expected errors increase, sample size should increase ► The size of the population to be sampled and whether a sample is appropriate We anticipate using certain data extraction tools, such as Galvanize (formerly ACL), in selecting and testing samples or complete populations, where appropriate. These effective tools allow us to efficiently test larger amounts of data. d. Extent of use of EDP software in the engagement People and their judgement and skills make the biggest difference in our services, but when our teams have access to and leverage technology effectively, we can enhance our delivery results. Ultimately, we work to deploy the right solutions that fit the needs of each client, but that requires a deep bench of technology solutions. Our audit, tax and consulting teams each have innovation leadership and significant project teams dedicated to advancing our capabilities in these areas. The following are some of those technologies that may impact your services along with how BKD is a leader in these areas. Getting & Using Data A significant challenge for some clients can be providing the reporting and data required for our services. Solutions we've built or deployed include: ► Providing a proprietary online client portal and collaboration site, BKDconnect Client Sites, for sharing requests and exchanging documents ► Using market-leading ingestion software from Validis to directly connect with certain general ledger packages to obtain required transaction detail with limited client effort and reduced additional requests Efficient Analysis While still in its infancy, technologies such as artificial intelligence (Al)are being leveraged along with other tools to efficiently analyze increasing volumes of data. Our efforts with data analytics, including Al, include: ► Training data champions who are using market-leading quantitative data analytics tools including MindBridge, Alteryx, Galvanize and TeamMate Analytics to not just ingest data, but to analyze and identify anomalies or unexpected results ► Leveraging market-leading software Kira that uses language processing and machine learning to help our analysis of written documents, such as leases, contracts, acquisition contracts and debt agreements ► Identifying new tools to increase efficiencies, such as our use of DataSnipper to streamline matching invoices or other support for testing lists and performing mathematical and other accuracy testing 34 BKD Workflows & the Cloud Many firms rely on outdated software or manual approaches to executing their work, while BKD is building or buying new tools to speed our efforts and better manage our delivery to clients. Our approaches include: ► Investing significant talent and financial support with the AICPA and approximately 40 other large firms to help build an audit technology designed to transform our practice and our ability to serve our clients in the future ► Using market leading tools such as Amelio and building our own proprietary solution to deliver a better client experience through cloud-based questionnaires, integrated risk assessment and response workflows that better enable us to execute our engagements and deliver results to our clients ► Increasing automation of our workflow and redundant tasks through robotic process automation (RPA) and application programming interfaces (API) e. Type and extent of analytical procedures to be used in the engagement Analytical procedures involve auditing a material assertion or account balance by investigating its relationship to an expectation such as other accounts, historical trends or other related measures. BKD recognizes that stronger analytical procedures can help reduce or eliminate other substantive procedures that are usually more time consuming. We would typically consider: ► Ratio analysis—comparing relationships among account balances, ratios, nonfinancial data, budgets or industry averages ► Reasonableness tests—using financial and/or nonfinancial data to develop an expectation of an account balance Successfully using analytical procedures requires auditors to ask the questions: ► What is the risk of material misstatement? ► How would we find those misstatements? ► Have I gathered enough audit evidence? When analytical procedures provide sufficient evidence, other substantive audit procedures should not be necessary. If analytical procedures are not sufficient, some combination of analytical and substantive procedures is likely to be the preferred approach. f. Approach to be taken to gain and document an understanding of the City of Dubuque's internal control structure Understanding your operations and the design of your controls helps create an effective and efficient audit process. When performing our first audit, this effort is more substantial. There are several data sources we intend to use, including your prior auditor. Our first objective is to identify those resources that might advance our understanding without extra effort on your part. If you have documentation of your organizational structure, control environment(including technology) and the controls you have in place, along with any testing of those controls, we can often just read and supplement that information as needed. Even when clients have effective controls, their documentation is often limited, so additional effort may be required. 35 BKD When starting with limited documentation, we will: ► Perform a risk assessment using your financial statements to identify the relevant areas for documenting our understanding and related testing. While we want to have an understanding of your operations, it isn't necessary for us to document every control, particularly when a control is not related to a significant audit area. ► Ask you to complete industry-specific questionnaires that summarize your control structure. You might complete these forms directly or we may interview you to guide the process, or some combination of both. This process includes understanding your information system and related controls. ► Identify who performs or can perform control activities. We can use industry-based assignment of duties forms to capture those assignments. ► Assess and/or identify key controls you have in place for significant areas of risk. We will look for gaps in your design and potential overlapping assignments of duties that could or should be segregated. ► Perform limited tests of design effectiveness of control activities. These tests will help us evaluate whether our documentation matches the activities occurring. ► Consider extended tests of controls. In some cases, your information may be so complex or voluminous that extended control testing is needed to rely on your control and reduce other substantive testing in our audit. ► Summarize recommendations for your consideration. For minor deficiencies or suggestions, we may discuss changes during our audit. For others, including significant deficiencies or material weaknesses, we will prepare written recommendations for your consideration. ► In periods following our first audit, the majority of our understanding and documentation will be complete. Going forward, we focus on changes that have occurred and continue performing tests of design effectiveness or expanded testing to evaluate whether control design has remained the same. g. Approach to be taken in determining laws and regulations that will be subject to audit test work Identification of applicable laws and regulations will begin with an inquiry of City of Dubuque as to your understanding of applicable laws and regulations. In addition, our reviews of various documents, indentures, agreements, etc., will be designed to encompass known laws and regulations within the scope of the audit. We are experienced in auditing public sector entities in the Iowa and are familiar with the laws and regulatory environment in which you operate. h. Approach to be taken in drawing audit samples for purposes of tests of compliance The sampling approach anticipated to be used in connection with the various areas of the audit is judgmental in nature. The size and nature of the population being tested, along with the assessed risk of the associated financial statement line item affected, will determine the size and approach for selecting a sample. Sample sizes will be sufficient to meet requirements of the various state and federal laws and regulations. We anticipate using data extraction tools, such as Galvanize's (formerly ACL) data extraction and analysis software, in certain situations in selecting and testing samples or complete populations, where appropriate. 8. Identification of Anticipated Potential Audit Problems The proposal should identify and describe any anticipated potential audit problems,the firm's approach to resolving these problems and any special assistance that will be requested from the City of Dubuque. While we do not anticipate significant audit problems, we understand the importance of good channels of communication with key engagement team members to facilitate the discussion of issues that may arise. Once we commence final fieldwork, we would ask for management's participation in weekly progress meetings that would facilitate such communication and allow for timely identification and response to problems that may be encountered. 36 BKD Proposer Guarantees & Warranties Appendix B — Proposer Guarantees APPENDIX B PROPOSER GUARANTEE The proposer certifies it can and will provide and make available,as a minimum,all services set forth in Section II,Nature of Services Required. Signature of Official: Name(typed): Jessica R.Richter,CPA,CITP,CISA Title: Partner Firm: BKo,LLP Date: April 22,2022 `Subject to the negotiations stated on the Exceptions to Terms and Conditions page of this proposal. Page 1ofl 37 BKD Appendix C — Proposer Warranties APPENDIX C PROPOSER WARRANTIES A. Proposer warrants that it is willing and able to comply with State of Iowa laws with respect to foreign(non-state of Iowa)corporations. B. Proposer warrants that it has and will maintain an errors and omissions insurance policy providing a prudent amount of coverage for the willful or negligent acts,or omissions of any officers,employees or agents thereof. C. Proposer warrants that it will not delegate or subcontract its responsibilities under an agreement without the prior written permission of the City of Dubuque. D. Proposer warrants that all information provided by it in connection with this proposal is true and accurate. Signature of Official: Name(typed): Jessica R.Richter,CPA,CITP,CISA Title: Partner Firm: BKD,LLP Date: April 22,2022 Page 1 of 1 38 THIS PAGE INTENTIONALLY LEFT BLANK ` ( Our Unmatched Client Service standards form the foundation of our culture. Our PRIDE values Ci enable us to continuously deliver on this commitment. Z Lil 0 CL Thomas W. Watson, CPA, FHFMA Chief Executive Officer I BKD 40 BKD Exceptions to Terms & Conditions Upon being selected as the successful bidder, BKD may require modification to the terms and conditions, as referenced in the RFP, to comply with professional standards and/or BKD's policies. As BKD has successfully resolved similar terms and conditions with municipalities, BKD is confident the parties can successfully negotiate a mutually acceptable agreement. 41 BKD Thinking of Your Future As previously mentioned, we believe the following services could be relevant to City of Dubuque. BKD LeaseVision: Assistance with GASB 87 Implementation GASB 87 is a significant consideration for many entities in the public sector. While this new guidance is intended to provide clarity for users of financial statements, it brings a host of considerations for both lessors and lessees. BKD LeaseVision can help. Through our work with hundreds of public sector entities nationwide, BKD has gained significant experience helping our clients implement complex GASB standards, including GASB 87. Our Approach to Helping Clients Implement the New Leases Standard BKD LeaseVision is scalable to a wide range of needs. While we anticipate our approach to helping City of Dubuque implement the new lease standard could include the following, depending on your staff's comfort level with the standard, and where you are in the implementation process, you can opt to receive any or all of the support described below. ► A detailed road map with clear instructions ► Excel spreadsheets with detailed instructions on use ► Contract terms extraction ► General consultative guidance ► Review of client-performed calculations ► Assistance with tailoring footnotes and financial statement format ► Review of accounting, reporting and internal controls and processes pertaining to lease activity ► Data mining related to lease contract population ► Other tailored consulting BKD Public Sector Reporting Solutions BKD is constantly on the lookout for innovative ways to apply technology to make tedious processes more efficient and effective for our clients. BKD is now a certified implementor of The Reporting Solution (TRS), a cloud-based tool that can help streamline the report preparation process, which could be a benefit for City of Dubuque as you work to issue an ACFR and continue your successful 33 year history of receiving an award through the GFOA's COA Program. Through TRS, BKD and our clients can connect to a cloud-based online platform to prepare the report with print-ready financial statements and a word processor that links to a financial database. In addition, changes can be made and updated in real time for all users to see. This platform allows multiple users to work simultaneously within the financial statement document, thereby creating an efficient, prompt and cost-effective preparation process. BKD also can complete a vigorous review of your ACFR—including the evaluation of your reports—using our independently prepared checklists designed to aid in financial reporting disclosure accuracy and completeness. Firmwide, we have numerous clients that participate in the COA Program, and several professionals who serve on the GFOA's Special Review Committee. We can work with you to help resolve identified discrepancies and reduce exceptions when your reports are returned. 42 BKD IntegraReport Studies indicate that a typical organization loses 5 percent of its annual revenue to fraud and that the most common method of detecting fraud is through tips from employees. BKD offers a confidential way for City of Dubuque's employees to report suspicious activity to help strengthen your antifraud program. BKD's IntegraReport hotline is accessed via an anonymous phone hotline or web-based portal and is monitored by BKD fraud professionals. The service includes providing your management with verbatim report transcriptions of tips reported to the hotline in a clean and easy to understand format. We also can provide assistance with hotline implementation, industry-specific fraud awareness training, hotline promotional materials, investigative services and forensic data mining services. 43 BKD AICPA Peer Review Letter National Peer 4116, . P Review Committee December 11,2020 Theodore Dickman BKD, LLP 910 E Saint Louis ST Ste 400 Springfield, MO 65806-2570 Dear Theodore Dickman: It is my pleasure to notify you that on December 11, 2020, the National Peer Review Committee accepted the report on the most recent System Review of your firm. The due date for your next review is November 30, 2023. This is the date by which all review documents should be completed and submitted to the administering entity. As you know, the report had a peer review rating of pass. The Committee asked me to convey its congratulations to the firm. Thank you for your cooperation. Sincerely, jAlter..dZit" Michael Fawley Chair, National PRC +1.919.402.4502 cc: Candace Wright, L Bennett Firm Number: 900010002800 Review Number: 577534 220 Leigh Farm Road.Durham,NC 27707-8110 T:+1.919.492.4502 F:+1. 19.419.4713 a.cpaglohaLcom I cimaglabal.com I aicpa.org I cima_arg 44 BKD BKD Peer Review Report 0.1 p 8550 United Plaza Blvd.,Ste.1001 — Baton Rouge,LA 70809 225-922-4600 Phone — 225-922-4611 Fax — pncpa.com 1111 Postlethwaite&Ncat Postlethwaite&Netterville and Associates,L.L.C. Report on the Finn's System of Quality Control To the Partners of BKD,LLP and the National Peer Review Committee We have reviewed the system of quality control for the accounting and auditing practice of BKD, LLP(the firm) applicable to engagements not subject to PCAOB permanent inspection in effect for the year ended May 31,2020. Our peer review was conducted in accordance with the Standards for Performing and Reporting on Peer Reviews established by the Pccr Review Board of the American Institute of Certified Public Accountants(Standards). A summary of the nature,objectives,scope,limitations of,and the procedures performed in a System Review as described in the Standards may be found at www.aicpa.org/prsummary. The summary also includes an explanation of how engagements identified as not performed or reported in conformity with applicable professional standards,if any,are evaluated by a peer reviewer to determine a peer review rating. Firm's Responsibility The firm is responsible for designing a system of quality control and complying with it to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. The firm is also responsible for evaluating actions to promptly remediate engagements deemed as not performed or reported in conformity with professional standards, when appropriate, and for remediating weaknesses in its system of quality control,ifany. Peer Reviewer's Responsibility Our responsibility is to express an opinion on the design of the system of quality control and the firm's compliance therewith based on our review. Required Selections and Considerations Engagements selected for review included engagements performed under Government Auditing Standards, including compliance audits under the Single Audit Act;audits of employee benefit plans,audits performed under FDICIA,an audit of a broker-dealer,and examinations of service organizations[SOC 1 and SOC 2 engagements]. As part of our peer review,we considered reviews by regulatory entities as comnnmicated to the firm,if applicable, in determining the nature and extent of our procedures. Opinion In our opinion,the system of quality control for the accounting and auditing practice of BKD, LLP applicable to engagements not subject to PCAOB permanent inspection in effect for the year ended May 31, 2020, has been suitably designed and complied with to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. Firms can receive a rating of pass,pass with defieiency('ies)or fail, BKD,LLP has received a peer review rating of pass. s Baton Rouge,Louisiana November 2,2020 45 BKD Press Release PRESS RELEASE BKD DHG MEDIA CONTACT:Mary Cullen 630.272.5691•mary@npstrategy.com Two Leading Accounting Firms Join Snow added that the strengths of the two companies will help clients better navigate the dynamic commercial Forces to Create Top-10, National landscape. Professional Services Firm "I couldn't be more thrilled to join forces with BKD.The BKD and DHG Combine for a Robust National scale of our combined firms,our collective talent and similar cultures will translate to tremendous benefits for Growth Strategy our clients and team members,"said Snow."Both of our SPRINGFIELD,Mo.and CHARLOTTE,N.C.(3 p.m.ET, firms have an overlapping industry focus in healthcare, February 17,2022)—The leading accounting firms of financial services and private equity,coupled with other BKD and DHG today jointly announced they have agreed industry sectors where each legacy firm is individually to merge to create a new,Top-10,national professional strong.As one organization,we will be able to bring our services firm with$1.4 billion in revenue,setting the capabilities to a broader range of clients,providing more stage for a national growth strategy. innovative,client-centric services to the market." With complementary operations,geographies and nearly The new firm will have a significantly larger national two centuries of legacy service between them,the two presence,ranked number 8,allowing it to quickly pivot firms together will operate under a new firm name that to new market opportunities as they arise and expand its will be announced at a later date.The new firm will reach.It will have more than 5,400 team members across provide deep industry focus,expanded advisory services, 68 markets in 27 states,including the United Kingdom and outstanding career opportunities,building the and the Cayman Islands.For clients,this brings greater foundation required for long-term growth and a stronger opportunity for more onsite,personalized attention from national presence with a gateway to global expansion. professionals,regardless of location. The merger of equals is expected to close in the second Key merger highlights are as follows. quarter of 2022,subject to the satisfaction of customary closing conditions. Strategically Compelling for Both Organizations Tom Watson,current CEO of BKD,will serve as the CEO of • Builds a national firm with$1.4 billion in revenue, the new organization;and Matt Snow,current CEO of DHG, uniquely positioned to deliver outstanding opportunities will serve as the Chair.The two industry leaders said the for team members and clients. merger will create a firm that is primed for growth in the current business landscape. • Merges two,well-established firms with strong operating histories spanning nearly 100 years. "For years,both BKD and DHG have built strong reputa- tions as high-value,professional client service firms," • Positions the firm for continued growth,expanding the breadth of services available to each firm's current said Watson."We've established complementary geographic footprints and strong capabilities in a range client bases while deepening the resources required to of critical service sectors.Together,as one organization, serve larger private and Fortune 1000 advisory clients. we will deepen our bench strength even further,allowing us to continue to serve our existing client base while also providing the resources necessary to serve an ever- increasing upstream client base." bkd.com•dhg.com 46 BKD PRESS RELEASE Beneficial for Clients and Team Members About DHG • Broadens geographic reach,placing experienced talent With more than 2,100 people in 13 states,Dixon Hughes in several key markets to provide onsite services more Goodman ranks among the nation's Top-20 professional efficiently. services firms.Offering comprehensive assurance,tax and advisory services,DHG focuses on major industry lines and • Builds scale in key industry areas and client service serves clients in all 50 states as well as internationally.Visit segments,creating synergies within existing indus- www.dhg.com for additional information. tries and expanding the reach of others to a total of 10 national industry practices. Global Alliance • Builds new career development opportunities across BKD and DHG are members of Praxity,AISBL,a global industry verticals and geographic locations. alliance of independent firms,which enhances its ability to serve the dynamic needs of multinational clients.PraxityTM • Improves national market recognition,supporting provides the gateway to tax,assurance and consulting growth of non-audit related services to better serve services delivered by alliance firms committed to the clients,including those in the Fortune 1000. highest standards required in international business. • Positions the firm as a destination employer with a people-driven culture. About BKD BKD CPAs&Advisors ranks among the nation's Top-15 professional services firms.The firm offers clients a variety of services in accounting,audit and assurance, and tax as well as risk management,technology and cybersecurity,wealth management,valuation services and more.BKD employs approximately 3,300 dedicated professionals who serve clients in all 50 states and in myriad industries.Visit www.bkd.com for additional information. BKD � DHL bkd.com•dhg.com 47 BKD BKD Firm Profile BKD CPAs&Advisors can help individuals and businesses realize their goals. Our dedicated professionals offer solutions for clients in all 50 states and internationally. BKD and its subsidiaries provide a variety of services, combining the insight and ideas of multiple disciplines in a wide range of industries. About BKD 0 Unmatched Client Service° Mission Statement tirt You want industry expertise delivered by someone who speaks The mission of BKD is to always strive for excellence in your language and understands your issues.Someone who providing services to clients, create rewarding career can help you solve problems with a formula that's equal parts opportunities and maintain sound professional, business integrity, innovation,excellence and passion. BKD understands. and financial standards. We're so committed to providing Unmatched Client Service that we wrote a book about it—The BKD Experience:Unmatched Quick Facts Client Service. • Clients: Individuals and private and publicly traded International Solutions businesses in the health care, manufacturing, distribution,financial services, construction and real BKD is one of the largest North American members of estate industries, as well as nonprofit and Praxity,AISBL*, a global alliance of independent firms serving governmental entities clients in more than 110 countries.We offer multinational • Total Personnel:Approximately 3,030 clients a gateway to the global marketplace with services • Partners & Principals:Approximately 310 delivered by alliance firms committed to the highest standards • Net Revenues: $758 million required in international business. • Fiscal Year-End: May 31 •� 0• • Founded: 1923 Professional Affiliations • Locations: 42 offices serving clients in all 50 states and internationally BKD is a member of the American Institute of CPAs and its *Praxity,AIS L is a global alliance of independent firms.Organised as an three quality centers: Center for Audit Quality, Employee international not-for-profit entity under Belgium law,Praxity has its Benefit Plan Audit Quality Center and Governmental Audit executive office in Epsom.Praxity-Global Alliance Limited is a not-for- profit company registered in England and Wales,limited by guarantee, Quality Center. and has its registered office in England.As an Alliance,Praxity does not practice the profession of public accountancy or provide audit,tax, BKD is registered with the Public Company Accounting consulting or other professional services of any type to third parties. Oversight Board,which is required to serve as an independent The Alliance does not constitute ajoint venture,partnership or network auditor of public companies. BKD audits approximately 76 SEC between participating firms.Because the Alliance firms are independent, Praxity does not guarantee the services or the quality of services provided registrants, including approximately 27 benefit plans. by participating firms. BKD Services • Audit&Assurance • Employee Benefit Plans • State, Local& International Tax • Tax • Forensics &Valuation Consulting • Wealth Management • Business Succession • Information Technology • And More Planning • Risk Management 48 BKD Facing Risk with Confidence When choosing an audit,tax or other professional services provider,your decision may partly depend on whether a prospective firm has the resources to go beyond your current needs.At BKD CPAs &Advisors,we're committed to consistently expanding and enhancing our services,technology and expertise so we can help our clients with their most pressing concerns,even as those concerns change daily. Beyond our proposed services, BKD's Risk Advisory Services division can help with an extensive range of risk consulting resources, including: • Data Analytics Consulting- From identifying important trends and opportunities for operational improvements to reducing risk and preventing fraud, our experienced data analysts can help you get more value from your data. • BKD WhiteHat Services-This monthly subscription offers access to a suite of cybersecurity services, including cyber awareness training, penetration and social engineering testing,a confidential fraud hotline and other risk management tools. • DEFCON CYBERTM-This risk assessment tool delivers a weekly report,which includes a cybersecurity score to help measure risk and cyber preparedness,as well as steps you can take to help address these risks and strengthen security. • Construction Audit-An effective construction audit is designed to function as a cost management tool by helping to prevent overcharges,contract noncompliance, conflicting charges and other issues common to construction projects. • Enterprise Risk Management IERMI- ERM consulting can help you review existing risk management activities, develop a unified vision to enhance these activities and more effectively integrate risk management into your culture and daily operations. • Forensics&Valuation Services(FVS)- BKD's FVS professionals can help clients with fraud prevention, detection, response and recovery.With services including IntegraReport'", our anonymous fraud reporting hotline, data analyses and assessments to help identify fraud,as well as investigations, litigation support and expert testimony,we have the tools and expertise needed to help clients address fraud concerns from beginning to end. BKD CPAs&Advisors bkd.com 49 BKD BKD PRIDE Values PRIDE VALUES BKD WHAT'S IMPORTANT TO YOU? rn4 The role of trust in business can't be oversold. But a trusted advisor is more D than someone you lean on for professional expertise. At BKD,we believe being an advisor who's earned your trust is as much about character as it is know-how. These are the traits we share. A PASSION FOR HELPING, LEARNING AND IMPROVING Our dedication and enthusiasm for making tomorrow better than today can help you make informed decisions to improve business and financial outcomes. RESPECT FOR EACH OTHER AND THOSE WE SERVE Our respect for diversity can provide a variety of skills and talents to meet your needs. By respecting the lessons of our legacy and yours,we can help you build on the opportunities that arise from inevitable change. INTEGRITY TO DO THE RIGHT THING—NO MATTER WHAT Our trustworthiness and objectivity can help you make smart business decisions. A trusted advisor tells you what you need to know, not just what you want to hear. DISCIPLINE TO GET IT RIGHT THE FIRST TIME Our well-established procedures and low-risk approach can help resolve issues and advance your goals. We're dedicated to getting the job done without cutting corners. A NO-HOLDS-BARRED STANDARD OF EXCELLENCE Our ambition and knowledge,along with our commitment to lifelong learning and improving our technical and analytical skills,will consistently surpass your expectations. This combination of qualities represents what we strive for every day when helping your organization move forward with confidence. bkd.com 50 Everyone needs a trusted advisor. BKD Whos yours? CPAs & Advisors bkd.com Request for Proposal for Annual Auditing Services A Fresh Look from Advisors Committed to Providing Unmatched Client Service® City of Dubuque, Iowa Submitted by BKD, LLP 1401 50th Street I Suite 350 I West Des Moines, IA 50266 Phone: 515.223.0159 Jessica R. Richter, CPA, CITP, CISA I Partner April 22, 2022 BKD Dollar Cost Bid CPAs & Advisors BKD C. Dollar Cost Bids 1 . Total All-Inclusive Maximum Price The dollar cost bids should contain all pricing information relative to performing the audit engagement as described in this RFP. The total all-inclusive maximum price to be bid is to contain all direct and indirect costs including all out-of-pocket expenses. The City of Dubuque will not be responsible for expenses incurred in preparing and submitting the technical proposal or the dollar cost bids. The first page of the dollar cost bids should include the following information (See Appendix D,page 1): a. Name of Firm BKD,LLP b. Certification that the person signing the proposal is entitled to represent the firm,empowered to submit the bids,and authorized to sign a contract with the City of Dubuque. As a partner of the firm, Jessica Richter is entitled to represent BKD, empowered to submit the bids and authorized to sign a contract with the City of Dubuque, Iowa (City of Dubuque). c. A summary of all-inclusive price for each individual year of the engagement. Bid for audit with maximum four major programs plus additional cost for additional major programs,if any. d. A total all-inclusive maximum price for the five(5)year engagement. BKD knows our clients do not like fee surprises. Neither do we. Our goal is to be candid and timely, and we want to answer your questions about fees upfront. We determine our fees by evaluating a number of variables: the complexity of the work, the project's scope, the time we will spend and the level of professional staff needed. As requested by the RFP, we have included all-inclusive maximum fees for each year and the corresponding total price for the five year engagement in Appendix D on the following page. Proposed fees include travel costs and an administrative fee of 5 percent to cover items such as copies, postage and other delivery charges, supplies, technology-related costs, such as computer processing, software licensing, research and library databases, and similar expense items. Our fees may increase if our duties or responsibilities change because of new rules, regulations and accounting or auditing standards. We will consult with you should this happen. Our estimate of fees does not include any time that may be required to address a restatement of the previously audited financial statements. Accordingly, any such work will be billed based on our quoted hourly rates. BKD and Dixon Hughes Goodman LLP (DHG) have agreed to a merger of equals, effective June 1, 2022. Any work provided after the effective date will be performed by the combination of our two firms. For more information, please see bkd.com. 1 BKD Appendix D — All-Inclusive Maximum Price Summary APPENDIX D PROPOSAL FOR AUDIT SERVICES ALL-INCLUSIVE MAXIMUM PRICE SUMMARY FOR THE CITY OF DUBUQUE Fee for each Additional Major Program(over Proposal for Audit Services: Total Price 5) Price of First Year of Engagement $ 71,500 $ 7000 (FY22) Price of Second Year of Engagement $ 75,125 $ 7,350 (FY23) Price of Third Year of Engagement $ 79,250 $ 7,700 (FY24) Price of Forth Year of Engagement $ 83,275 $ 8,100 (FY25) Price of Fifth Year of Engagement $ 87,800 $ 8,500 (FY26) Total All-Inclusive Maximum Price $ 396,950 Maximum Coversion Audit Cost for ERP $ 5,000 Proposal of BKD,LLP Address 1401 50th Street I Suite 350 I West Des Moines, IA 50266 Authorized Signer Date April 22,2022 *This fee does not include the price of auditing the implementation of GASB 87. That cost is estimated to be$5,000-$7,000. Page 1 of 1 2 BKD 2. Rates by Partner, Specialist, Supervisory & Staff Level Times Hours Anticipated for Each Pages two(2)through six(6)of the dollar cost bids should include a schedule of professional fees and expenses that supports the total all-inclusive price for the 2022 fiscal year of the engagement and each of the four(4) subsequent fiscal years, presented in a format similar to Appendix D, page 2. City of Dubuque, Iowa For the Years Ending 2022 2023 2024 2025 2026 June 30 Financial Statement Audit in Accordance with Government Auditing Standards for City of Dubuque&Dubuque Metropolitan Solid Waste Agency, including U.S. Department of Housing&Urban Development(HUD)Agreed- Upon Procedures &a Passenger Facility Charge (PFC) Program Audit Hourly Hourly Hourly Hourly Hourly Staff Level Hours Rate Total Hours Rate Total Hours Rate Total Hours Rate Total Hours Rate Total Partner/ 51 $290 $14,790 51 $30 $15,300 53 $318 $16,854 51 $340 $17,340 52 $357 $18,564 Director Manager 119 $140 $16,660 119 $145 $17,225 119 $150 $17,896 119 $160 $19,040 119 $168 $19,992 Senior Associate/ 159 $110 $17,550 158 $119 $18,945 158 $125 $19,875 159 $131 $20,870 159 $159 $21,944 Associate Subtotal 328 $49,000 329 $51,500 330 $54,500 329 $57,250 330 $60,500 Compliance Audit in Accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) Staff Level Hours Hourly Total Hours Hourly Total Hours Hourly Total Hours Hourly Total Hours Hourly Total Rate Rate Rate Rate Rate Partner/ 20 $290 $5,800 20 $30 $6,000 20 $318 $6,360 20 $340 $6,800 20 $357 $7,140 Director Manager 30 $140 $4,200 30 $145 $4,350 29 $150 $4,495 29 $160 $4,640 29 $168 $4,872 Senior Associate/ 100 $110 $11,000 98 $119 $11,700 98 $125 $12,245 98 $131 $12,860 98 $159 $13,488 Associate Subtotal 150 $21,000 148 $22,050 147 $23,100 147 $24,300 147 $25,500 Total ®■ $70,000 ®■ $73,550 ®■ $77,600 ®■ $81,550 477 ■ $86,000 3 BKD 3. Out-of-Pocket Expenses Included in the Total All-Inclusive Maximum Price & Reimbursement Rates The total all-inclusive price should include all out-of-pocket expenses. This includes expenses for travel, lodging, meals,etc. BKD understands the above requirement. Our proposed fees include all out-of-pocket expenses. 4. Rates for Additional Professional Services If it should become necessary for the City of Dubuque to request the auditor to render any additional services to either supplement the services requested in this RFP or to perform additional work as a result of the specific recommendations included in any report issued on this engagement,then such additional work shall be performed only if set forth in an addendum to the contract between City of Dubuque and the firm. Any such additional work agreed to between City of Dubuque and the firm shall be performed at the same rates set forth in the schedule of fees and expenses included in the dollar cost bid. BKD will perform additional work at the rates provided within this proposal and only if set forth in an additional contract. 5. Manner of Payment Progress payments will be made on the basis of requests of the audit firm. Interim billings shall cover periods of not less than a calendar month. The City will not pay more than ninety percent(90%)of a single year's fees before the delivery of the final auditors' opinion and reports requested by the Request for Proposal. Our pricing for this engagement and our fee structure is based upon the expectation our invoices will be paid promptly. We will issue monthly progress billings during the course of our engagement and payment of our invoices is due upon receipt. Interest will be charged on any unpaid balance after 45 days at the rate of 10 percent per annum. 6. Tax-Exempt Entity The City is a tax-exempt entity,thus taxes are not to be included in fee calculations. BKD has not included taxes in our fee calculations. Our acceptance of this engagement is subject to completion of our normal client acceptance procedures. Upon acceptance,the actual terms of our engagement will be documented in a separate letter to be signed by you and us. The information provided in this proposal is intended for informational purposes only and may not be copied,used or modified,in whole or in part,without BKD's prior written approval.All information in this proposal is as of May 31,2021,unless otherwise noted. 4 Everyone needs a trusted advisor. BKD Whos yours? CPAs & Advisors bkd.com „.....w.,.., ----71 EideBailly.OF CHANGE . , - .. . _. Ai , . .. INSPIRED TO . ,, \, . STAY AHEAD ..._. _.... - p S r 'I �'.b. ' 1 . '`:':`, 'r .1 ‘t': Li i 2-, •_”:. 7 , I - .-ii I j . I I/ . . • \i'„ •.;, I i. Title Page April 22, 2022 Proposal for Annual Auditing Services CITY OF DUBUQUE Submitted By: Eide Bailly LLP Brian Unsen, CPA-Partner 1545 Associates Dr., Suite 101 563.557.6152 I bunsen@eidebailly.com Dubuque, IA 52002-2299 CITY OF DUBUQUE ii. Table of Content i. Title Page 1 ii. Table of Contents 2 iii. Transmittal Letter 3 iv. Detailed Proposal 5 1 . General Requirements 5 2. Independence 5 3. Licensed to Practice in Iowa 5 4. Firm Qualifications and Experience 7 5. Partner, Supervisory, and Staff Qualifications and Experience 12 6. Similar Engagements with Other Government Entities 14 7. Specific Audit Approach 15 8. Identification of Anticipated Potential Audit Problems 23 Additional Resources 25 The Right Choice for City of Dubuque 26 v. Appendices 27 Appendix A: Peer Review 27 Appendix B: Proposer Warranty 28 Appendix C: Proposer Warranties 29 Appendix D: Team Profiles 30 Appendix E: Legal and Insurance Exceptions for Consideration 36 Appendix F: Acknowledgement of Addenda 37 EideBailly. What inspires you, inspires us. eidebailly.com CITY OF DUBUQUE iii. Transmittal Letter WE WANT TO WORK WITH YOU Thank you for giving Eide Bailly the opportunity to propose on audit services for the City of Dubuque (the City). We've enjoyed working with the City and 111 share a common commitment to the community. We look forward to continuing this successful relationship. _ We are confident the City will continue to benefit from the knowledge and historical perspective we provide and believe we are the best candidate for EXPERIENCE this engagement for the following reasons: Our experienced professionals are committed to the industries S.• Understanding of Work: We understand the scope of services include we serve.We focus on training, an audit of the City's basic financial statements in accordance with Governmental Auditing Standards and the Code of Iowa. In addition, we will and we like to think of ourselves audit the City's compliance over major federal award programs (Uniform as thought leaders. Guidance) and the compliance requirements described in the Passenger Facility Charge Audit Guide for Public Agencies.The engagement will also include the financial statement audit of Dubuque Metropolitan Area Solid PEOPLE Waste Agency (component unit) and agreed upon procedures related to the We're a team of collaborators Real Estate Assessment Center (REAC) of the U.S. Department of Housing and and innovators. Our culture is Urban Development (HUD). From our discussions and your Request for the heart of our Arm, and we're Proposal (RFP), we understand the timeline that meets your needs and we commit to meeting your deadlines. Our professionals are trained to always working together to do anticipate, identify and respond to your needs in a timely manner. things differently and better. Extensive Government Industry Experience: We have served the government industry for more than 70 years and work with more than 1,200 COMMUNICATION government clients throughout the nation. Your engagement team audits Open, honest, frequent over 20 Iowa government entities, including the preparation of nine Annual communication ensures that Comprehensive Financial Reports (ACFR) receiving the Government Finance you're not in for any surprises. Officers Association's (GFOA) Certificate of Achievement for Excellence in Financial Reporting. We'll stay in touch throughout the year so you feel understood, Through serving these clients, our professionals have gained focused connected and confident. expertise regarding government organizations and will continue to provide you with insightful advice that aids in managing the finances of the City. We understand your specific challenges, needs and goals and have fine-tuned our CORPORATE process to create a more effective and efficient engagement. We are active in RESPONSIBILTY the industries we serve and stay abreast of current issues impacting the government industry and grow our knowledge by attending workshops and We consider ourselves good trainings. During your engagement, we will continue to work closely with your corporate citizens—caring for management team to identify issues and provide responsive solutions our people, giving back to our tailored to your organization. communities, and taking care of our environment. 3 I eidebailly.com CITY OF DUBUQUE pop. Depth of Resources: Our size enables us to be responsive to our clients' needs and unique entity challenges while also providing the necessary breadth and depth of services required in today's complex and ever-changing business environment. In addition,you'll experience partner involvement during all phases of the engagement, as well as throughout the year. At Eide Bailly, we make it a priority to be accessible to our clients, which includes returning phone calls and emails in a timely manner. Thought Leadership:We are leaders in the government industry, offering valuable perspectives beyond our core strength of accounting and tax compliance. We're business advisors who want to help guide the strategy and operations of your organization, and we'll make sure you feel connected and understand the process. Our professionals work closely together so you receive valuable service from people who understand your needs and know the City. �tO We Want to Work with You:We've developed the following proposal with the City in mind, and we'll continue to provide timely, personalized audit services for you. We know you and your staff and understand your specific challenges and opportunities. We deliver honest and insightful advice beyond what is normally experienced in the public accounting industry. If you're still wondering "Why Eide Bailly,"our tagline sums it up — what inspires you, inspires us.Your success is our success. Authorized Representative: Brian Unsen, as a partner of Eide Bailly, is authorized to make representations for the firm, present this proposal and to contractually bind the firm. He will be able to answer any questions you may have regarding this proposal. He submits this proposal as a firm and irrevocable offer for 90 days. The following pages highlight our firm's strengths and tailored solutions we can provide for the City. We believe this demonstrates why Eide Bailly merits serious consideration. You will remain a highly valued client, and we would be proud to work with the City of Dubuque and grow our trusting relationship with your team. Please contact me if you would like to discuss any aspect of this proposal. Sincerely, Brian Unsen,CPA Partner 563.557.6152 bunsen@eidebailly.com 4 I eidebailly.com CITY OF DUBUQUE iv. Detailed Proposal 1 . GENERAL REQUIREMENTS We understand the general requirements as set out in the City's RFP and have prepared our detailed proposal to adhere to format and content requests. 2. INDEPENDENCE Eide Bailly is independent of City of Dubuque and all of its component units as defined by the generally accepted auditing standards and the U.S. Government Accountability Office's Government Auditing Standards and as defined by the rules of the American Institute of Certified Public Accountants (AICPA). No member of our firm has a direct or indirect interest in the City. Eide Bailly has served as the certified public accounting firm for the City but we are confident this does not cause a conflict of interest and that we remain independent. The other general standard for auditing requires the audit organization and the auditors be free from personal and external impairments to independence. As defined by these standards, Eide Bailly is independent in fact and in appearance, and no relationships, either personal or professional, exist that would cause our firm to not be impartial in dealing with the City. Should Eide Bailly enter into any professional relationships deemed relevant during the course of this engagement, we will notify you in writing of such relationship. 3. LICENSED TO PRACTICE IN IOWA Eide Bailly and each of the professional staff assigned to the City are properly registered and licensed to practice in Iowa. Firm Registrations: Iowa Secretary of State Registration Number: 634093 Iowa State Board of Accountancy Permit Number: 2017-0244 5 I eidebailly.com CITY OF DUBUQUE A majority of states, including Iowa, have adopted mobility legislation — a practice privilege that generally permits a licensed CPA in good standing from a substantially equivalent state to practice outside of his or her principal place of business without obtaining another license. All assigned key professional staff have complied with government qualification standards, including government continuing education requirements. 6 I eidebailly.com CITY OF DUBUQUE • / ill . 11 ' 1: i 1 ;-as ,,-; / L `. ' 1 - _ i i i � _ 1 , : r Vim: � 4. FIRM QUALIFICATIONS AND EXPERIENCE WHAT INSPIRES YOU, INSPIRES US AT A GLANCE Your experience will be different than working with other CPA firms because we offer knowledge and skills backed by more than 100 years of service. Our professionals deliver industry and subject matter expertise resourcefully, ensuring we are providing le guidance that directly reflects your needs. Our clients benefit from local, personal service and, at the same time, enjoy access to more than 2,500 professionals with diverse skill sets and experiences. TOP 25 CPA FIRM Navigating a Path to Success Together 0 By embracing change and focusing on innovative ideas, we've grown along with our clients to become one of the top 25 accounting firms in the nation.Accounting is about numbers, but our business is about relationships. 40+ OFFICES IN 14 STATES We'll be there for you every step of the way.Talented, down-to-earth people work at our firm, and we're inspired to deliver outstanding expertise and care. We're driven to help you take on the now and the next with inspired ideas, solutions and results. 0 Our work with clients is more than an engagement. It's a relationship, built on values and trust — and results. When working with Eide Bailly,you will: 350+ PARTNERS • Work with professionals who truly care about your business and will take the time to get to know you and your organization. lie • Gain insight from our industry and service specialists to accomplish your ■ O objectives, address challenges and leverage new opportunities. • Make better business decisions knowing you are guided by trusted advisors 2,500+STAFF MEMBERS who care about your success. • Appreciate our hands-on service style;we are always looking for new ways to mN, solve your problems or help you embrace opportunities. COD FOUNDED IN 1917 7 I eidebailly.com CITY OF DUBUQUE Local Office Presence The City will continue to benefit from local, personal service from our Dubuque office.The Dubuque office audits over 20 Iowa government entities, including seven of the largest 20 cities in the state and over 10 single audits. Our resources in Dubuque allow us to assign a team to the City with experience in working with similar government clients leading to numerous audit efficiencies. Number and Nature of Engagement Team The team assigned to the City has extensive experience with government entities;we bring a strong, experienced team that is uniquely qualified to serve the City.The proposed service team for the City will include one partner, one senior manager and one associate. Additional staff members and specialty service providers will be assigned to the City's engagement as needed. We expect the audit team will include five members.All audit team members assigned to the City's engagement are full-time employees of Eide Bailly. WE UNDERSTAND GOVERNMENTS The firm has 275 full-time professionals who participate in our Government Industry Group.These professionals share information, learn from others and stay up to date on industry • - developments.To gain the greatest benefit, the knowledge is r• • • shared with professionals across the firm. I • /+ 1111) The government industry represents one of Eide Bailly's largest niche areas—with more than 1,200 government clients firmwide. We provide audit services for a variety of cities, e111Mor counties, colleges and universities, fire relief agencies, housing • _• authorities, school districts, state agencies and tribal entities. Through serving these clients, our professionals have gained focused expertise in the government industry and will provide ..\-, iaenmyent Clieoffiren a •Gorernnts you with insightful advice that aids in managing the finances of the City. These services include, but are not limited to, evaluating internal control structure, assessing control risk and performing tests of controls, as well as testing compliance with applicable laws and regulations in accordance with Government Auditing Standards. Government Industry Involvement Eide Bailly prioritizes staying current with changes to the government industry. We help clients adapt to changes within the existing standards and implement any new standards. Our team members are engaged in the government industry and are well positioned in organizations associated with government entities. We are leaders in the Governmental Accounting Standards Advisory Council (GASAC),the AICPA's Governmental Audit Quality Center, AICPA State and Local Government Expert Panel, Private Companies Practice Section (PCPS)Technical Committee, local and national boards of the Association of Government Accountants (AGA), including the Financial Management Standards Board, and the review committee for the Government Finance Officers Association's(GFOA) Certificate of Achievement for Excellence in Financial Reporting. Due to our leadership positions, the City will have access to information not available from other accounting firms. 8 I eidebailly.com CITY OF DUBUQUE Eide Bailly also regularly attends Governmental Accounting Standards Board (GASB) meetings throughout the year, and we communicate the results of those meetings to our clients through our newsletters, e-blasts and webinars. We are also involved with GASB's financial reporting reexamination task force shaping the future of state and local government accounting and reporting and participate in the reexamination of the revenue and expense model and note disclosure projects with GASB. Implementation of New Standards In an industry where standards continually evolve and change, Eide Bailly makes it a priority to stay current and assist our clients with necessary changes. In addition to helping clients implement new standards, we also help them adapt to changes within the existing standards. Additionally, several Eide Bailly professionals serve on committees that have input into how new standards are written.This enables us to be involved from the beginning and influence the final outcome. Our clients benefit from our strong understanding of the standards and how they may affect their organization. We will work with the City to create a plan to address new standards. Single Audit Experience Eide Bailly has experience providing single audits related to federal expenditures which ensure our clients remain compliant. Our single audits include an audit of both the financial statements and the federal awards. We also assist in the preparation of the data collection form and prepare the reporting package for submission to the federal audit clearinghouse. Eide Bailly has a three-year average of auditing more than $22.8 billion in federal expenditures, which provides us with extensive experience in single audits. Not only are we on the forefront of new 22.8 billion regulations, but because of our vast experience with government in federal entities, we are also familiar with a wide variety of federal programs.As the City looks to expand its current federal programs, expenditures we can pull from our expansive database of federal programs that we have audited and provide consultation on what has worked audited effectively for other entities.This will help the City establish strong 3-year average controls and processes over new federal programs rather than trying to rework controls and processes after the programs are established. GFOA Certificate of Achievement for Excellence in Financial Reporting Because we know how important achieving the GFOA Certificate of Achievement for Excellence in Financial Reporting is to clients,we work with them to achieve this certification. Members of our government team, including Brian Unsen and Brad Theisen, are members of the GFOA's Special Review Committee for the Certificate of Excellence for Achievement in Financial Reporting. Below is a summary list of some of our government audit clients served from the Dubuque office who have been awarded and currently maintain the GFOA's Certificate of Achievement for Excellence in Financial Reporting: City of Ankeny, IA City of Dubuque, IA City of Urbandale, IA City of Ames, IA City of Maple Grove, MN Johnson County, IA City of Cedar Falls, IA City of Marshalltown, IA Linn County, IA City of Davenport, IA 9 I eidebailly.com CITY OF DUBUQUE Joint Venture or Consortium Eide Bailly is not a joint venture or consortium and has the experience and capacity to perform the request services without outsourcing work to any other firms. Peer Review Eide Bailly is a member of the American Institute of Certified Public Accountants. Our membership with the AICPA requires a third-party peer review of our audit and accounting practice every three years. A copy of our firm's most recent peer review is included in Appendix A of this proposal. The quality review included several government engagements and received a rating of'Pass'. No letter of comments was issued. Desk Reviews Pursuant to state-specific code, desk reviews are performed on certain audited financial statements and field reviews of audited financial statements and supporting working papers on a regular basis. In addition, Uniform Guidance and federal grant agreements and contracts may also require the review of financial statements and/or working papers by a federal or state agency. As these reviews are conducted, Eide Bailly cooperates fully with the agency requiring such reviews. We are not aware of any outstanding items as a result of the desk review. There have been no state desk reviews of the Dubuque Office's audits during the past three years. Disciplinary Action The firm and its partners, as well as our clients, may periodically be the subject of investigations,formal or informal inquiries, or requests for information from a variety of regulatory agencies. It is the policy of the firm not to discuss these matters, or any client-related matters, outside of the firm. It is the firm's opinion that none of these activities have a material impact to the firm. No member of the engagement team assigned to the City has been the subject of investigation or action by any law enforcement or regulatory agency in the past three years. Thought Leadership A number of partners at Eide Bailly are nationally recognized state and local government thought leaders who present at dozens of national venues throughout the year.These include: GFOA; National Association of State Auditors, Comptrollers and Treasurers; California Society of CPAs; California Society of Municipal Finance Officers; Oregon Government Finance Officers Association;the California State Association of City Retirement Systems;the California Association of Public Retirement Systems;AGA National Professional Development Conference; National Association of Housing and Redevelopment Officials (NAHRO); Iowa Society of CPAs; Idaho Society of CPAs; Utah Society of CPAs; and Colorado GFOA. Furthermore, Eric Berman, Partner, is the author for the entire Governmental Library for Commerce Clearinghouse Wolters Kluwer(CCH). This library serves as the interpretative reference on government Generally Accepted Accounting Principles (GAAP),government best practices and government audits for governments, auditors and educators nationwide. Eric will be an additional resource for the City and is available to assist or consult as needed. 10 I eidebailly.com CITY OF DUBUQUE Online Publications:The City will also have access to resources on our Eide Bailly Government Industry website. We publish articles related to hot issues within VISIT OUR WEBSITE TO SIGN the government accounting arena. Below is a list of some of the recent articles UP FOR NEWSLETTERS, posted to our website and emailed to our clients: E-BLASTS AND WEBINARS: • Changes to Single Audit Compliance in the Wake of COVID-19. www.eidebailly.com • How to Use Operational Analytics to Lead During a Downturn. • What You Need to Know About GASB Financial Reporting Guidance. • Common Single Audit Findings and Remediation Series: Subrecipient Monitoring. • How a Performance Audit Helps an Organization be More Efficient and Effective. Webinars:We host frequent webinars dedicated to helping you and your organization navigate complex issues. Each webinar covers a different topic to help evaluate the steps necessary to achieve success and remain ahead of the curve. December 2021 GASB Update—What's Going on Other than Leases? Recorded Webinar This webinar will help your government get ready for December 31, 2021, year-ends as well as fiscal year-ends in 2022, beyond implementing GASB Statement No. 87, Leases. Yes, there is other GAAP. GASB Statement Nos. 89, 93, 91, 92, 94, 96 and 98 will be quickly reviewed, along with other pending GAAP standards from the Governmental Accounting Standards Board. GASB-87 Leases Workshop (Three-Part Webinar Series) Part I: Basics and Lessees.The first part of the series uses two to three real lease scenarios from a lessee perspective. Policy and procedure "pain points" are also discussed, so you can review and update your policies and procedures as soon as possible. Recorded Webinar Part 2: Lessors.The second part of the series focuses on lessor accounting in a hands-on manner, using two to three real lease scenarios from a lessor perspective. Financial reporting and implementation provisions, as well as regulatory leases and leases that are investments, are discussed. Recorded Webinar Part 3: Special Issues, Implementation, GASB-94 and GASB-96. In this final installment, we focus on special issues and implementation challenges including subleases, sale-leasebacks, lease-leasebacks, related entity leasing and how GASB-94, GASB-96 and an upcoming Omnibus may impact your GASB-87 implementation project. One or two "special issue" leases are reviewed in detail to show why these leases need added attention. Recorded Webinar Creating a Culture of Security: Governmental Cybersecurity Trends Recorded Webinar Have you created a culture of a security within your organization? It's not a matter of if an incident will occur, it's a matter of when. Planning for a cyber incident now, can save you time and money in the future. Not getting cybersecurity right, could mean chaos, should a breach occur. We're here to help you create a culture of security, learn more about current governmental trends and next steps. 11 I eidebailly.com CITY OF DUBUQUE ---"°11111811**818111881111114411.41 "IlIt i mil g • , s . � ma .., \ .. ,,,,, „. ,,,..„•„. 1 �11,,,,a ,:,..,..., ,.... J.' ,1.16.,- ,. 'i; , ,.,.,...,.,,,,.,,'�. 7 . .,... . ,� r.: f 'its._ •�1 ...: .e 114... 0 it ...._._ _.„_ _,. ',,•'„').,...��1 1 d� .....,•_ 5. PARTNER, SUPERVISORY, AND STAFF QUALIFICATIONS AND EXPERIENCE AN EXPERIENCED SERVICE TEAM We're passionate about our work — and your success. We have selected professionals for your service team who are the right fit for your engagement, based on their knowledge and experience in the government industry and with the City. Brian Unsen will return to lead the engagement team and serve as the Audit Engagement and Client Relationship Partner. Brad Theisen will continue to serve as the Audit Senior Manager, assisted by Associate Kate Banwarth.These professionals are licensed to practice public accounting and bring strong credentials and historical knowledge of the City. If awarded these engagements,these individuals will serve as your primary contacts. You'll find profiles for each team member in Appendix D,with relevant continuing professional education (CPE) included. Additional resources will support the project team as necessary. Senior and Staff Associates All of our seniors have more than two years of experience in public accounting,with several who specialize in the government industry. We require Yellow Book compliance for all members of our assurance staff.This means no fewer than 24 hours of specific Government Education courses each two- years. Most members of our audit staff significantly exceed that amount. Once an agreeable timeline has been determined,we will assign a few of our talented seniors and staff to your engagement. Affirmative Action Eide Bailly desires to create an inclusive and diverse environment where we build a workforce reflective of the communities in which we serve. Different people and different perspectives help us to provide innovative solutions for our clients, opportunities for our people and successes for the firm. At Eide Bailly, we are committed to the principles of Equal Employment Opportunity and Affirmative Action. 12 I eidebailly.com CITY OF DUBUQUE Staff Continuity To help ensure a strong business relationship and to minimize disruptions, we keep staffing changes to a minimum. Compared to the national average, Eide Bailly experiences a higher retention rate, which translates to providing our clients with consistent service teams. We will strive for continuity of staff for your engagement. With this continuity comes quality as team members' knowledge of your organization grows from year to year. 3-Yeor History Staff Retention 88% 89% 88% FY 2019 FY 2020 FY 2021 Should the need arise to change any of the key engagement personnel, we will notify you in writing and provide the qualifications of the proposed replacement. Upon your approval, new engagement personnel will join your service team. Continuing Education Because we are committed to the government industry, we provide our professionals with specific, ongoing training related to these industry issues.This investment ensures our people stay current on the unique challenges and opportunities within their industries so they are in the best position to help clients address these issues. We accomplish our regulatory and accounting standard training through attendance at various AICPA sessions. Firmwide, our CPE program requires all professional staff obtain education that 1 exceeds the requirements of the AICPA and where applicable, Government Auditing Standards.The firm places a strong emphasis on lifelong learning and _ 72 recognizes the importance of developing our professionals to best serve our clients.This past year we provided our client service professionals with an average of 72 hours of professional education, compared with the 40-hour N 1 accounting industry requirement. In addition,we regularly share information among the audit teams in different offices to ensure we are providing clients CPE HOURS with the latest thinking and best possible solutions. Our government professionals obtain CPE through the following means: fide Rainy FYo21 INDUSTRY STANDARD:40 • Government-specific seminars sponsored by the AICPA and GAQC. • Seminars sponsored by the GFOA. • Involvement with local chapters of the GFOA(we teach and attend GFOA conferences, regularly). • Eide Bailly seminars specific to government issues taught by our experienced managers and partners. By expanding our knowledge of issues important to government organizations, we can provide more in- depth, knowledgeable solutions to our clients.Additional communication, webinars and training are provided throughout the year on a variety of topics important to state and local governments. 13 I eidebailly.com CITY OF DUBUQUE Mir . i TN 1► . 11 . lioz„ '-- - ., , ./ • x. - a:--f` t. ( „. •-iwilik • i - . i t , e ;ti; .s 6. SIMILAR ENGAGEMENTS WITH OTHER GOVERNMENT ENTITIES CLIENT REFERENCES As a top 25 CPA firm, we've built our business on relationships and believe our clients to be the best critics of our service. The clients below have similarities to your organization, and we encourage you to contact them to learn about their Eide Bailly experiences. The following engagements all included Brian Unsen as the Engagement Partner and Brad Theisen as the Engagement Senior Manager. Contact Basia Gerlach,Accounting Manager City of 563.326.7727 I basia.gerlach@davenportiowa.com Davenport Scope of Work Financial statement and single audit Date June 30,2021(Client since 2020) Total Hours 508 Contact Duane Pitcher, Director of Finance 515.239.5114 I dpitcher@city.ames.ia.us City of Ames Scope of Work Financial statement and single audit Date June 30,2021(Client for over 20 years) Total Hours 500 Contact Diana Steiner, Finance Director 641.754.5760 I dsteiner@marshalltown-ia.gov City of Scope of Work Financial statement and single audit Marshalltown Date June 30,2021(Client for over 20 years) Total Hours 467 Contact Jennifer Sease,Administrative Services Director 515.965.6409 I isease@ankenyiowa.gov City of Ankeny Scope of Work Financial statement and single audit Date June 30,2021(Client since 2021) Total Hours 425 Contact Jennifer Rodenbeck, Director of Finance and Business Operations 319.268.5108 I iennifer.rodenbeck@cedarfalls.com City of Cedar Scope of Work Financial statement and single audit _ Falls Date June 30,2021(Client for over 20 years) Total Hours 342 14 I eidebailly.com CITY OF DUBUQUE Automation 111111 ," iness WORKFLOW Process Ali 7. SPECIFIC AUDIT APPROACH AUDIT METHODOLOGY At Eide Bailly, we promise you a better overall experience. While we recognize that multiple firms are capable of accomplishing the objectives of an audit, Eide Bailly appreciates that every situation and every organization is different, and we tailor our approach based on the needs of each client. Eide Bailly values its business relationships and demonstrates this through our partner and manager involvement. Our senior level professionals are involved with our clients and accessible throughout the year.They do not delegate all tasks to staff, but rather stay involved on-site during fieldwork and stay connected throughout the year.This approach delivers the greatest benefit to our clients because we are able to stay abreast of changes in and updates to our client's operating environment and collaborate to achieve optimal results. Our communication philosophy has historically been a service hallmark with our clients. We recognize this area of service with the City was not up to par this past year. We are committed to improvement and have built in weekly status updates to our audit plan. Our service and communication approach begins with planning and continues throughout the year resulting in effective communication that is critical throughout the entire audit process. Additionally, we take a collaborative communication approach with our clients and include them in the process as our peers. Our clients offer a wealth of knowledge and information about their organization, and communicating with them proactively produces the best outcome. Prior to beginning the engagement,we will discuss with management: • The engagement timeline. • The audit approach and process. • Additional considerations that may affect scope, schedules and workpapers to be prepared by your personnel. 15 I eidebailly.com CITY OF DUBUQUE Upon appointment as your auditor, we will discuss the audit schedules and work with you to ensure the timeline meets your needs and makes the most effective use of your staff members' time. We also recognize the ongoing communication of the audit status is important to the City and will strive to improve the process. AUDIT WORK PLAN Our engagement approach for the City audit has well-detailed goals by which the engagement partner and manager can measure progress. By engaging in thorough audit planning and communications with management, we begin each engagement with a strong understanding of the various deadlines for each of the financial and single audits and the steps involved along the way to meet these deadlines. Our audit plan includes frequent contact between the partners and the engagement team to assure that objectives are attained according to the audit schedules and problems are communicated and dealt with on a timely basis. We are also including weekly status updates during the audit with City management to show our commitment to our growing relationship. Our engagement approach benefits from our vast experience working with similar government entities;we understand the key areas of risk over the financial and accounting process. More importantly,the approach provides for a complete reassessment of the management and control environment in each year's audit and thus can respond to changes and will ensure deadlines are met in issuing the annual financial statements.The key characteristics of our engagement approach are: 1. Knowledge of the City of Dubuque and similar entities. We have extensive experience auditing the City and other similar government entities.This experience enables us to perform a more efficient audit and identify key audit risks. 2. Cost-effectiveness. Our experienced auditors' low percentage of turnover and our use of technology to conduct the audit results in a reduction of cost for our clients. 3. Timeliness. We take deadlines, both yours and ours, seriously. 4. Partner-manager involvement. Deciding on audit strategies requires seasoned judgment. Our partners and managers have been heavily and continuously involved in government audits for decades. Furthermore, you will be able to consult with senior team members whenever needed throughout the year. We are available during the year for any additional consultation that may arise and specified in the request for proposal. (a) Proposed Segmentation of the Engagement Our audit approach is designed to collaborate with the City and achieve optimal results.The approach consists of five major components: Planning, Interim Work, Fieldwork, Reporting and Ongoing Communication. If awarded, we will discuss with management our proposed schedule, but we also have the flexibility to make any changes to meet the reporting deadlines.The objectives of each component are described in the following pages: Planning Interim Work Fieldwork Reporting Ongoing Communication 16 I eidebailly.com CITY OF DUBUQUE PLANNING • Discuss and finalize the engagement timeline, audit approach and process. • Discussions with management and accounting staff, including the City Council to address any risks or concerns they may have. • Evaluate the nature of the operating environment(for example, changes in volume, degree of system and reporting centralization,sensitivity of processed data,the impact on critical business processes, potential financial impacts, planning conversions and economic and regulatory environment). • Review of interim financial information and reports to identify significant risks and changes early. • Review of significant estimate areas and consideration of underlying assumptions early in process. • Update our understanding of the City and its reporting units and their environments. • Documentation of internal control systems, including IT and related changes from prior periods. • Consideration of fraud, risk of noncompliance, illegal acts,abuse, etc. • Assess audit risk and identify potential audit issues. • Assess materiality and testing scopes to extent possible and presentation of audit plan. • Preparation and communication of audit request lists and workpapers. • Develop expectations regarding timing and audit progress. • Gain understanding of single audit programs and perform an analysis of potential major federal programs. • Review of the City's documents,such as budgets, organizational charts, manuals and programs, and financial and other management information systems, INTERIM WORK • Discussions with management to determine internal controls, perform walk- throughs and discuss any potential audit issues. • Determine audit procedures by area, based on results of audit planning and risk assessment. O • Determine confirmation needs. _ • Prepare listing of audit information requested from the City. • Review minutes, resolutions and ordinances. • Perform tests of legal compliance. • Begin single audit testing. • Updates to City staff. • Exit conference with management. 17 I eidebailly.com CITY OF DUBUQUE FINAL FIELDWORK • Audit areas based on risk assessment. • Obtain and prepare schedules and analyses supporting the financial information. • Discuss findings with management, if any. • Discuss proposed journal entries with management, if any. • Finalize single audit testing. • Updates to City staff. • Exit conference with management. REPORTING • Review of the financial statements by the partner over the engagement. • Review of financial statements by a partner not otherwise associated with the audit to obtain a "second opinion"on the completeness and adequacy of financial statement disclosures and audit procedures. • Completion of management letters and review with management. • Preparation of other communications to management and the City Council. • Assistance with preparation of the Data Collection Form. • Preparation of the reporting package for submission to the Federal Audit Clearinghouse. • Be available for the presentation of the financial statements to the City Council. ONGOING COMMUNICATION • Obtain interim financial information throughout the year for review. • Analyze significant changes and identify areas to further tailor our audit plans and • • to keep us up to date with continuing changes.kTo • Compare the interim results to year-end results for the past few years to identify potential issues in the financial reporting process. Participate periodically at your Council meetings,and - • other - ',:s, as requested. We will hold an exit conference with management and have a discussion on any potential findings and will come to a final conclusion during the conference. Our goal is to have no additional findings subsequent to the exit conference. 18 I eidebailly.com CITY OF DUBUQUE (b) Level of Staffing and Number of Hours Below is our proposed level of staffing and estimated hours for each segment of the audit. Historically we have had high partner and manager involvement in the audits and propose to continue these high levels. Partner Manager Senior Staff Other Total Planning and Pre-Work 10 10 20 20 5 65 Interim Work 30 40 50 60 - 180 Fieldwork 50 60 50 160 - 320 Reporting 30 30 20 30 25 135 Total 120 140 140 270 30 700 (c) Statistical Sampling Sampling may be performed for tests of controls, compliance testing and substantive tests of certain accounts and transactions. During our audit of basic financial statements, we will also select various transactions for testing based on materiality assessed at the appropriate level.These transactions may include such items as capital asset additions, expenditures, subsequent disbursements and subsequent receipts. We will be pleased to discuss specific sample sizes and selection methods when they are determined, either during audit planning or during fieldwork. We will select the appropriate sample size to support our conclusions in compliance with laws and regulations. (d) Extent of Use of EDP Software in Engagement Eide Bailly staff utilizes progressive and effective software to streamline processes and make them as efficient as possible.These technologies include: My Eide Bailly(Web-Based Client Site) My Eide Bailly is an online client site that gives clients the ability to transfer files securely and connect digitally with Eide Bailly. ff Email is not a secure way to exchange documents, but My Eide EIDE BAIL L 1 Bailly can handle large file uploads in a safe, secure manner. In addition, My Eide Bailly offers clients visibility into their projects, control over who can access and see files related to those projects(including third parties), and an easy way to access invoices, browse articles and register for upcoming webinars and events. My Eide Bailly makes it easy to share and stay connected with Eide Bailly, creating efficiencies for both clients and Eide Bailly staff during engagements. Additional features will continue to be added in order to help clients quickly, and securely, exchange documents with their service team. Data Extraction Software Eide Bailly designs our approach to incorporate the use of TeamMate Analytics to maximize efficiency while conducting a very effective audit. Through TeamMate, we can extract information from related databases and create databases that check for duplicate payments, summarize payments, extract journal entries from specific accounts, develop expectations for analytical 19 I eidebailly.com CITY OF DUBUQUE procedures and recalculate system calculations, among a host of other procedures developed by our audit team. CCH ProSystem fx Engagement by Wolters Kluwer This software is used to perform the audit, retains the electronic workpapers and supporting documentation, performs project tracking and facilitates quality engagement review. Adapting to Change Many of our clients are wondering about working on their audits remotely. Eide Bailly performs all engagements in a paperless environment. As a technology-driven firm, we've seen no issues in performing audit procedures off-site from our clients. We've taken advantage of technology, such as using Microsoft Teams, which allows us to communicate with our clients face to face, while sharing screens,to make the process as seamless as possible.We're utilizing Zoom to host webinars and town hall meetings to educate and assist our clients on rapidly changing circumstances and how to successfully navigate those changes.As a result, we have no concerns completing this audit remotely should the need arise. We'll discuss with management which approach, remote vs. on-site, works best for you. (e) Analytical Procedures Eide Bailly will apply analytical procedures throughout general planning to improve our understanding of your operations and to identify audit areas for increased attention.These will be applied to assist in planning the nature,timing and extent of other procedures.They will be applied to all balance sheet, revenue/receipt and expense/expenditure areas.These procedures include, but are not limited to, the comparison of current year to prior year and budget amounts. Areas that show results different from those anticipated or planned will be further investigated to determine the validity of the variance. During the year-end audit fieldwork, we use analytical procedures to test whether errors affecting account balances or classes of transactions have occurred by comparing the recorded amount with an independently developed expectation of that amount. We develop the expectation in such a way that a significant difference between the expectation and the recorded amount is indicative of a financial statement misstatement unless we can obtain and corroborate explanations for the difference. Analytical procedures are a natural extension of our understanding of your business because the key factors that influence your business may be expected to affect the financial data. In the audit reporting phase, we perform a final analytical review at the financial statement level as the last step to ensure that we have gained a comprehensive understanding of the financial statements during the audit engagement and to determine whether the financial statements are appropriately presented and contain appropriate disclosures. Such final analytical procedures highlight and explain significant changes from the previous year and ensure that such changes are consistent with the knowledge of your business and our audit evidence.These procedures typically consider trends based on several previous years, instead of comparison only with the prior period. (f) Internal Control Structure A significant aspect of the planning process involves understanding each reporting units' internal control environment, including information technology(IT) controls and, where relevant,testing of internal controls. 20 I eidebailly.com CITY OF DUBUQUE The following is a summary of the process Eide Bailly uses regarding internal controls over financial reporting and compliance: Internal Controls over Financial Reporting Our approach will start with any documentation related to internal controls already developed. We review that documentation to obtain an overview of the internal control system and then conduct interviews with the City's staff to complete the documentation of our understanding related to internal controls and significant changes each year. After conducting the interviews, we will evaluate the internal control system design and expected operating effectiveness for significant areas depending on the reporting unit. We expect that by reviewing controls in these areas, it will allow us to plan and conduct an efficient audit. Our approach toward reviewing controls will be focused on key process controls or overall system controls, rather than detailed processes. Eide Bailly utilizes a risk-based approach incorporating both the review of controls and substantive tests of balances, where appropriate. We plan to conduct the audit using a primarily substantive approach. It has been our experience that it is often more efficient and effective to substantively audit a balance rather than complete an extensive control test. Internal Controls over Compliance Our approach for internal controls over compliance associated with federal programs is similar to the approach regarding internal controls over financial reporting related to accumulation, documentation and evaluation of the control environment. Test of controls over compliance are required for major federal programs. Our approach is identifying key controls applicable to direct and material compliance requirements for testing. The approach we will take to gain an understanding of your internal controls includes: • Interview City personnel. • Review organizational charts, accounting and procedure manuals and programs. • Complete internal control questionnaires. • Write-up system narratives. • Evaluate items selected for testing. • Review controls over financial information systems. The timely completion of this work will assist us in performing our work efficiently and communicating any potential recommendations as soon as possible. In addition, our engagement approach is based on the following: • Observations we believe will help the City achieve its objectives will be shared. We will also be pleased to respond to inquiries you may have about financial or other business matters. • The assistance to be provided by your personnel, including the preparation of schedules and analyses of accounts, will be discussed with the finance department. The timely completion of this work will assist us in performing our work efficiently. 21 I eidebailly.com CITY OF DUBUQUE (g) Determining Laws and Regulations Subject to Audit Test Work During the planning process, we will also discuss with City management and personnel the laws and regulations to which the City is subject.The objective of our discussion will be to determine those laws and regulations that could have a material impact on the financial statements and those laws and regulations pertinent to the City's federal financial assistance programs. Pertinent to our discussion will be our knowledge of such laws and regulations, and our knowledge of Government Auditing Standards. We are aware of the applicable requirements and consider them when determining the necessary audit procedures for the City. We will perform tests of the City's compliance with certain provisions of laws, regulations, contracts and grants. We will assess the risk of material misstatement resulting from violations of laws and regulations having a direct and material effect on the determination of financial statement amounts.These laws and regulations can relate to items such as budgetary compliance, purchasing compliance and cash and investment compliance, as well as single audit compliance, as applicable. We will combine compliance tests of laws and regulations that involve the inspection of documentation supporting transactions with substantive tests of transactions and tests of control procedures. Our audit will meet all federal and state requirements, as applicable. Samples will be used to the extent necessary to support our conclusions on compliance with laws and regulations. (h) Drawing Audit Samples for Purposes of Tests of Compliance In accordance with AICPA single audit guidance, our sample sizes used in the testing of compliance requirements will be based on the level of assurance needed, which considers both inherit risk and control risk. We will be pleased to discuss specific sample sizes and selection methods when they are determined, either during audit planning or during fieldwork. Meeting Your Deadlines We understand your requested timeline and are committed to meeting your deadlines. Eide Bailly commits to you that if your team is prepared for the audit when our team is in the field, we will meet your deadlines. We will work closely with your team through the planning stages to clearly define expectations and the items required from your team in order to facilitate an efficient audit to enable us to meet your deadline. The following table identifies the structure of our audit for City reports and the timing of each section: Engagement Timeline Activity Timing Planning and Pre-Work June-August Interim Work October Fieldwork November Reporting December Ongoing Communication Throughout the Year 22 I eidebailly.com CITY OF DUBUQUE By engaging in thorough audit planning and communications with management, we begin each engagement with a strong understanding of the various deadlines for each of the financial and single audits and the steps involved along the way to meet these deadlines. An audit project plan will be developed between our team and the City and then followed closely, and we will work with the City's management team to customize our auditing services and specific timelines to your needs. We believe in clear, up-front and open communication with no surprises. Ability to Meet Deadlines and Shorten the Time in the Field We understand the frustrations of an audit firm not meeting your stated deadlines. We commit that we can, and will, meet your deadlines as well as shorten the amount of time needed in the field. Our experience with other government audits has enabled us to fine-tune our audit process.This translates to a smooth and more efficient audit for you while meeting your deadlines and keeping our fees at a reasonable rate. 8. IDENTIFICATION OF ANTICIPATED POTENTIAL AUDIT PROBLEMS Eide Bailly understands the potential for problems that may arise while conducting our audit and we are prepared to address any issues with you as they arise. We are committed to making our relationships work and do what it takes to make our clients feel comfortable even if it means late-night conference calls. We will also work our schedule so when we leave the field we will be substantially done with the audit and any wrap-up will be related to outstanding requests and report issues. We believe we have a system in place that, combined with the experience we have gained, will translate to meeting your reporting deadlines with a smooth and efficient audit. Communication before, during and after the audit is a hallmark of Eide Bailly's audit process.As part of our collaborative approach, we will meet with management during audit planning to gain a thorough understanding of the City's expectations and any changes to the organization. During the audit process, we will communicate progress through oral and written status updates and discuss significant audit issues as they arise.At the conclusion of the audit,we will jointly evaluate the effectiveness of the audit and any recommendations for future changes. Our service model does not view the audit process as an annual "event." Instead, we communicate with management on an ongoing basis and keep you apprised of accounting pronouncements, changes in regulations and other changes that may impact the City. Our communication with management includes the following: • Personal interaction between the team serving the City and management in the form of meetings, phone calls and emails. We like to be involved with clients throughout the year to help address ongoing issues that impact your operations. Our preferred communication is through face-to-face meetings, or at least phone conversations. We value your time and attempt to keep meetings relevant, appropriate and productive. • Status updates as audits progress with appropriate members of management through oral and written communications. • Ongoing communication of important regulatory changes and accounting updates occurs via email, shortly after the changes are announced or finalized. • Occasional webinars and seminars on topics of critical interest to our government clients will communicate important information for management to be aware of. 23 I eidebailly.com CITY OF DUBUQUE Under this communications approach, we will discuss specific preferences you have in communicating with us including frequency and style.As we know your organization, our process has become increasingly customized to the City,yet it still follows the framework we have put together as guidelines our staff are expected to embrace as part of our service culture. We recognize ongoing communication of the audit status is important to the City and communication was weakened in the past couple of audits due to a variety of reasons, including City and Eide Bailly staff turnover. Know that communication is important to us and we have built in weekly status updates during the audit to strive for improvement. Most audits have issues that arise from time to time; however, we will resolve these issues through frequent communications with you, and by helping you with implementation issues, adjusting journal entries or communications with GASB/lowa State Auditor's Office staff. Assistance from Your Staff Your service team will meet with the City's management for initial planning and pre-audit conference to discuss audit schedules and review prior year audit concerns. We will then provide the City's personnel any needed updates to the Prepared by Client List(PBC). We'll hold meetings with the accounting personnel throughout the audit process determining the list of open items and the plan to finalize those items. During the audit, our use of the City's personnel will include answering questions, updating schedules, addressing issues identified and obtaining support documentation. Our audit processes focus on performing the audit efficiently,which includes constant communication amongst the team members so we're not asking redundant questions or requesting the same document several times. We also hold weekly meetings with management to determine the status of the audit and any outstanding items to be addressed.This keeps the amount of hours needed by the City's personnel to a minimum. We ask our clients to have the requested schedules, documentation, confirmations and financial statements prepared by the requested dates. Having these items prepared before we arrive for final fieldwork ensures the success of meeting the mutually agreed upon deadlines. 24 I eidebailly.com CITY OF DUBUQUE A74' A /4 1„ 4i, .4 l c.w. 1 Additional Resources LET US HELP YOU WITH MORE We are leaders in the government industry, offering valuable perspectives beyond our core strength of accounting and tax compliance. We are business advisors who want to help guide the strategy and operations of your organization, and we will make sure you feel connected and understand the process. Our professionals work closely together so you receive valuable service from people who understand your needs and know your business. When you work with us,you will have access to the knowledge and talents of more than 2,500 professionals across our firm.This includes specialized tax knowledge, a full spectrum of audit/assurance services and our many specialized services, such as: Cybersecurity Our professionals have deep IT backgrounds, specializing in a broad range of security services and allowing us to tailor solutions to your needs. We work with every level of your organization—your boards and executives,technical IT admins and general users—to provide insight and guidance so you can be confident your data is protected. Internal Audit Our internal audit professionals bring strong process, procedure, internal control and risk management experience to your organization. We bridge these skills with specialized insight related to risk and compliance and specific industry knowledge to help your organization reduce risk and improve operational efficiency. Forensic Accounting We have seasoned professionals with years of relevant investigative experience. Our forensic accountants are experienced in assisting with internal, civil, criminal and insurance recovery investigations related to allegations of theft,fraud and accounting irregularities.The forensic methodologies and technology used by our team of specialists help get to the facts of these situations and are court proven. We understand the urgency of resolving these types of matters and deliver a quality work product in an efficient and timely matter. 25 I eidebailly.com CITY OF DUBUQUE w - -4,1°11111111.°9;5/ The Right Choice for City of Dubuque GROWING OUR SUCCESSFUL RELATIONSHIP To us, work is not just work; we see it as a chance to help you solve problems, achieve goals and pursue passions.After thoughtfully reviewing your needs and taking the time to understand your business, we think we are the best fit for this opportunity. We will continue connecting you with the knowledge, resources and solutions that help bring confidence to your business decisions. We want to work with you! If you have questions or would like additional information, do not hesitate to contact us. We want to make sure you have everything you need to make your decision. Brian Unsen, CPA Partner 563.557.6152 bunsen@eidebailly.com What inspires you, inspires us We are driven to help clients take on the now and the next with inspired ideas, solutions and results. We look forward to working with you. 26 I eidebailly.com CITY OF DUBUQUE V. Appendices APPENDIX A: PEER REVIEW Cherry Bekaert' .10 CPAs&Advisors Report on the Firm's System of Quality Control January 20,2021 To the Partners of Eide Bailly LLP and the National Peer Review Committee We have reviewed the system of quality control for the accounting and auditing practice of Eide Bailly LLP (the firm)applicable to engagements not subject to PCAOB permanent inspection in effect for the year ended July 31, 2020. Our peer review was conducted in accordance with the Standards for Performing and Reporting on Peer Reviews established by the Peer Review Board of the American Institute of Certified Public Accountants (Standards). A summary of the nature,objectives, scope, limitations of, and the procedures performed in a System Review as described in the Standards may be found at www.aicpa.org/prsummary. The summary also includes an explanation of how engagements identified as not performed or reported in conformity with applicable professional standards,if any,are evaluated by a peer reviewer to determine a peer review rating. Firm's Responsibility The firm is responsible for designing a system of quality control and complying with it to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects.The firm is also responsible for evaluating actions to promptly remediate engagements deemed as not performed or reported in conformity with professional standards, when appropriate, and for remediating weaknesses in its system of quality control,if any. Peer Reviewer's Responsibility Our responsibility is to express an opinion on the design of the system of quality control and the firm's compliance therewith based on our review. Required Selections and Considerations Engagements selected for review included engagements performed under Government Auditing Standards, including compliance audits under the Single Audit Act; audits of employee benefit plans, audits performed under FDICIA,an audit of a broker dealer,and examinations of service organizations[SOC 1 and SOC 2 engagements]. As a part of our peer review, we considered reviews by regulatory entities as communicated by the firm, if applicable,in determining the nature and extent of our procedures. Opinion In our opinion,the system of quality control for the accounting and auditing practice of Eide Bailly LLP applicable to engagements not subject to PCAOB permanent inspection in effect for the year ended July 31, 2020, has been suitably designed and complied with to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. Firms can receive a rating of pass,pass with deficiency(ies)or fail.Eide Bailly LLP has received a peer review rating of pass. Nnirkl 6e,koi.6 Cherry Bekaert LLP 27 I eidebailly.com CITY OF DUBUQUE APPENDIX B: PROPOSER WARRANTY APPENDIX B PROPOSER WARRANTY The proposer certifies it can and will provide and make available,as a minimum,all services set forth in Section II, Nature of Services Required. Signature of Official: Name(typed): Brian Unsen,CPA Title: Partner Firm: Eide Bailly LLP Date: April 20,2022 Page 1 of 1 28 I eidebailly.com CITY OF DUBUQUE APPENDIX C: PROPOSER WARRANTIES APPENDIX C PROPOSER WARRANTIES A. Proposer warrants that it is willing and able to comply with State of Iowa laws with respect to foreign (non-state of Iowa)corporations. B. Proposer warrants that it has and will maintain an errors and omissions insurance policy providing a prudent amount of coverage for the willful or negligent acts,or omissions of any officers,employees or agents thereof. C. Proposer warrants that it will not delegate or subcontract its responsibilities under an agreement without the prior written permission of the City of Dubuque. D. Proposer warrants that all information provided by it in connection with this proposal is true and accurate. Signature of Official Name(typed): Brian Unsen,CPA Title: Partner Firm: Eide Bailly LLP Date: April 20,2022 Page 1 of 1 29 I eidebailly.com CITY OF DUBUQUE APPENDIX D: TEAM PROFILES A TEAM YOU CAN TRUST BRIAN M. UNSEN, CPA Partner Vim �: INSPIRATION: I am inspired and motivated by the unique challenges I face every day R. - and the opportunity to provide exceptional client service. 563.557.6152 I bunsen@eidebailly.com .oy ,;'�u �,,��, ;, 0SI +r e;P iT 1 ,� r t r �"Y 1 Since joining Eide Bailly in 1998, Brian has specialized in public Memberships accounting services to government entities and nonprofit American Institute of Certified organizations. He provides audit expertise to a variety of clients, Public Accountants including city and county governments. Iowa Society of Certified Public When you work with Brian,you can expect a team approach to Accountants solving your tax and accounting challenges. It's a model that has been well established at Eide Bailly,whereby no matter the client, all of the Government Finance Officers firm's resources are available to help whenever and however needed. Association Special Review Committee Outside the office, Brian likes to stay active. His main hobbies all involve lacing up a pair of athletic shoes and breaking a sweat. He Designation/Licensures spends most of his free time running, biking and hiking, and if Certified Public Accountant possible, he drags along a friend or family member to keep him company...sometimes whether they like it or not. Education Bachelor of Arts,Accounting— Client Work Loras College, Dubuque, Iowa Conducted audits of local governments and nonprofit organizations. Ongoing continuing professional Conducted audits of federal awards. education, including governmental accounting and Consulted on agreed upon procedures engagements, including HUD auditing education Real Estate Assessment Center(REAC) procedures. Community Saint Montfort Haiti Committee, member Take Away Hunger Food Relief Organization, volunteer Dubuque Community Days of Caring,volunteer 30 I eidebailly.com CITY OF DUBUQUE W> Relevant CPE Courses for Brian Unsen Course Title Sponsor Date Total Credits 2021 11111. Accounting Ethics-Integrity Pryor 12/26/2021 1.5 CPAs and Independence Checkpoint Learning 12/21/2021 ' 1.0 December 2021 GASB Update-What's Going on Other than Eide Bailly LLP 12/02/2021 1.5 Leases? HCNN October Eide Bailly LLP 10/07/2021 1.0 Compliance Supplement Update and The Various Federal COVID Eide Bailly LLP 09/21/2021 1.5 Acts Becoming a Trusted Advisor to your Government Client-Structuring Eide Bailly LLP 08/23/2021 1.5 the Conversation for Success Session 1: Becoming a Trusted Advisor to Gov Clients Eide Bailly ALP 08/10/2021 0 ASN 2021-06: Independence, Leases&Lease Query Eide Bailly LLP 08/10/2021 0 Leasing Standard:Where do you go from here? Eide Bailly LLP 08/10/2021 1.0 Partner Meeting-Keynote 2021 Eide Bailly LLP 06/15/2021 2.0 Planning Considerations for 2021 Single Audits(COVID-19 focus) Eide Bailly LLP 05/27/2021 1.0 GASB Webinar Series 2021 Eide Bailly LLP Various 4.5 A&A Update Spring Eide Bailly LLP 05/25/2021 6.0 Iowa Governmental Roundtable(IGR-WEB 21) Eide Bailly LLP 05/18/2021 8.0 Iowa Governmental Audits-Local Government Update(IGA-WEB 21) Iowa Society of CPAs 05/17/2021 4.0 The Paycheck Protection Program -Legislative Update Eide Bailly LLP 01/25/2021 1.0 Nonprofit Tax&Industry Update Eide Bailly LLP 01/20/2021 1.0 Single Audit Webcast:2020 Compliance Supplement Addendum Eide Bailly LLP 01/05/2021 1.0 2020 PPP Forgiveness Update Eide Bailly LLP 09/08/2020 1.0 Governmental Update 2020(GASB Webinar Series) Eide Bailly LLP Various 11.5 Government&NPO Conference 2020 Eide Bailly LLP 07/15-17/2020 11.5 A&A Update 2020 Eide Bailly LLP 05/14/2020 8.0 Budgeting and Cash Flow Modeling in a Crisis for States and Local Eide Bailly LLP 05/13/2020 1.0 Governments Webinar Student Financial Aid Single Audit Training Eide Bailly LLP 05/08/2020 2.0 Internal Staff Training for GASB-87 Eide Bailly LLP 04/09/2020 1.0 2019 GASB Update:Just the Facts Eide Bailly LLP 09/27/2019 2.0 Single Audit Basic Trainings Eide Bailly LLP 07/31/2019 2.0 Government&NPO Conference 2019 Eide Bailly LLP 07/11-12/2019 11.0 Professional Ethics:2020 Update and Refresher AICPA 07/02/2019 2.0 Partner Meeting 2019 Eide Bailly LLP 06/19-20/2019 8.0 Iowa Governmental Audits-Local Government Update Iowa Society of CPAs 05/13/2019 24.0 Governmental A&A Update 2019 Eide Bailly LLP 04/23/2019 8.0 GASB Statement No.84, Fiduciary Activities and Student Activity Eide Bailly LLP 03/21/2019 1.0 Fund 31 I eidebailly.com CITY OF DUBUQUE BRAD J. THEISEN, CPA Senior Manager INSPIRATION: I am passionate about serving our clients.My goal is to help our clients through the financial statement audit process using an interactive team approach,all while providing exceptional client service and advice during the financial reporting process. 563.557.6168 I bitheisen@eidebailly.com Brad helps our clients through the day-to-day reporting process. He Memberships leads the audit team during fieldwork and provides insightful advice American Institute of Certified on financial reporting. Public Accountants When you work with Brad,you can expect he will provide excellent Iowa Society of Certified Public client service in a timely fashion. Accountants Outside of work, Brad enjoys spending time outdoors with his family. Government Finance Officers He loves coaching all three of his daughters in activities like softball Association, Special Review and basketball. Brad also enjoys firing up the bar-b-que pit on Committee weekends during the summer. Designation/Licensures Client Work Certified Public Accountant Conducts audit work and special projects for a variety of government clients. Education Bachelor of Arts,Accounting and Economics—Loras College, Dubuque Community Nativity Finance Council Dubuque Community Days of Caring,Volunteer Take Away Hunger Food Relief Organization, Volunteer Dubuque Girls Independent League, Board Member 32 I eidebailly.com CITY OF DUBUQUE W> Relevant CPE Courses for Brad Theisen Course Title Sponsor Date Total Credits 2021 2020 Personal and Professional Ethics for Louisiana CPAs Checkpoint Learning 12/21/2021 3.0 December 2021 GASB Update—What's Going on Other than Leases? Eide Bailly LLP 12/02/2021 1.5 Compliance Supplement Update and The Various Federal COVID Acts Eide Bailly LLP 09/21/2021 1.5 Becoming a Trusted Advisor to your Government Client-Structuring the Conversation for Success Eide Bailly LLP 08/23/2021 1.0 Healthcare&Government Retreat Eide Bailly LLP 07/14-15/2021 5.0 GASB-87—Leases Workshop-Part 2-Lessors Eide Bailly LLP 07/13/2021 2.0 The American Rescue Plan Act Basics&What We Can Do for Our Eide Bailly LLP 06/25/2021 2.0 Governments GASB Webinar Series 2021 Eide Bailly LLP Various 5.0 Becoming a Trusted Advisor to your Government Client Eide Bailly LLP 06/21/2021 1.5 A&A Update Spring Eide Bailly LLP 05/25/2021 6.0 Iowa Governmental Roundtable(IGR-Web 21) Iowa Society of CPAs 05/18/2021 8.0 Single Audit Webcast:2020 Compliance Supplement Addendum Eide Bailly LLP 01/05/2021 1.0 2020 IN FOCUS: Revenue and Expense Recognition -Preparers and FASB/GASB 11/19/2020 1.0 Auditors II GASB Webinar Series 2020 Eide Bailly LLP Various 15.5 Single Audit Update:2020 Uniform Guidance Changes Eide Bailly LLP 10/21/2020 1.0 Single Audit Update—2020 Compliance Supplement and COVID-19 Eide Bailly LLP 09/21/2020 1.0 Impact Government&NPO Conference 2020-Governmental Track Eide Bailly LLP 07/16-17/2020 7.5 A&A Update 2020 Eide Bailly LLP 05/14/2020 8.0 Budgeting and Cash Flow Modeling in a Crisis for States and Local Eide Bailly LLP 05/13/2020 1.0 Governments Webinar Iowa Governmental Audits-Local Government Update(Virtual Iowa Society of CPAs 05/11/2020 24.0 Format) Internal Staff Training for GASB-87 Eide Bailly LLP 04/09/2020 2.0 Expertise Made Easy-CCH Accounting Research Manager(ARM)for Eide Bailly LLP 01/21/2020 1.0 Eide Bailly Consulting Essentials Webinar-2019 Eide Bailly LLP 01/10/2020 1.0 2019 Ethical Issues: Not-for-Profit Governance AICPA 12/20/2019 2.0 CPAs and Independence Checkpoint Learning 12/20/2019 1.0 Real-World Business Ethics:Scrap Metal Aggregators, Inc.—You Are AICPA 12/20/2019 1.5 the Tax Return Preparer Government&NPO Conference 2019 Eide Bailly LLP 07/10-11/2019 13.0 A&A Update 2019 Eide Bailly LLP 05/23/2019 4.0 Iowa Governmental Audits-Local Government Update&Iowa Iowa Society of CPAs 05/13/2019 24.0 Governmental Roundtable Governmental A&A Update 2019 Eide Bailly LLP 04/23/2019 8.0 33 I eidebailly.com CITY OF DUBUQUE KATE BANWARTH, CPA Associate INSPIRATION: I am inspired by the opportunity to provide quality client service throughout the audit process and offer the best possible solutions to client questions through collaboration with the audit team. 563.557.6172 I kbanwarth@eidebailly.com Kate provides audit services for government entities with a primary Memberships focus on cities and counties. American Institute of Certified Public Accountants When you work with Kate,you can expect her to prioritize client service by responding promptly and thoroughly to address any client Iowa Society of Certified Public questions. Accountants Outside of work, Kate enjoys spending time with family and friends, Designation/Licensures working on various arts and crafts projects and spending time Certified Public Accountant outdoors. Education Client Work Bachelor of Arts,Accounting- Provides audit services to government entities. University of Northern Iowa, Cedar Falls Performs agreed-upon procedures for HUD REAC entities. Conducts audits of employee benefit plans. 34 I eidebailly.com CITY OF DUBUQUE W> Relevant CPE Courses for Kate Banwarth Course Title Sponsor Date Total Credits 2021 December 2021 GASB Update-What's Going on Other than Leases? Eide Bailly LLP 12/02/2021 1.5 Checkpoint CPAs and Independence Learning 11/28/2021 1.0 Government Report Writing Training Eide Bailly LLP 08/10/2021 2.0 GASB-87 Leases Workshop Eide Bailly LLP Various 4.0 Healthcare&Government Retreat Eide Bailly LLP Various 10.0 GASB Webinar Series June 21 Eide Bailly LLP Various 6.0 Assurance Advantage Level 2 Eide Bailly LLP 06/04/2021 15.0 A&A Update Spring Eide Bailly LLP 05/25/2021 6.0 ERISA Industry Update Eide Bailly LLP 05/20/2021 1.5 Live Training ASN 2021 Eide Bailly LLP 05/07/2021 1.5 ERISA Basic Training Eide Bailly LLP 04/22/2021 7.0 Live Training Session:ASN 2020 Eide Bailly LLP 01/15/2021 1.5 Year End COVID Relief Legislation Eide Bailly LLP 01/06/2021 1.0 2020 Governmental Update 2020(GASB Webinar Series) Eide Bailly LLP Various 13.0 Live Training Session:ASN 2020 Eide Bailly LLP 11/13/2020 2.0 Single Audit Update-2020 Compliance Supplement and COVID-19 Impact Eide Bailly LLP 09/21/2020 1.0 TNN 2020 Eide Bailly LLP 08/26/2020 1.0 Government&NPO Conference 2020-NPO Audit Track Eide Bailly LLP 07/15/2020 3.0 ASN 2020 Eide Bailly LLP 06/26/2020 1.5 Single Audit(June 16th) Eide Bailly LLP 06/16/2020 5.0 TNN 2020 Eide Bailly LLP 05/27/2020 1.0 A&A Update 2020 Eide Bailly LLP 05/14/2020 8.0 Budgeting and Cash Flow Modeling in a Crisis for States and Local Governments Webinar Eide Bailly LLP 05/13/2020 1.0 ERISA Basic Training Eide Bailly LLP 04/30/2020 8.0 ERISA Industry Update Eide Bailly LLP 04/29/2020 3.0 NTO Update 5 Eide Bailly LLP 04/21/2020 1.0 Internal Staff Training for GASB-87 Eide Bailly LLP 04/09/2020 2.0 ASN 2020 Eide Bailly LLP 04/03/2020 1.5 Expertise Made Easy-CCH Accounting Research Manager(ARM)for Eide Bailly Eide Bailly LLP 01/21/2020 1.0 ASN-January 2020 Eide Bailly LLP 01/17/2020 1.5 Preseason Tax Update-Dubuque Eide Bailly LLP Various 5.0 2019 Real-World Business Ethics AICPA 12/20/2019 3.0 Ethical Issues: Not-for-Profit Governance AICPA 12/20/2019 2.0 ASN- November 2019 Eide Bailly LLP 11/15/2019 1.5 ASN-September 2019 Eide Bailly LLP 09/06/2019 1.5 Government&NPO Conference 2019-NPO Audit Track Eide Bailly LLP Various 16.0 ASN-June 2019 Eide Bailly LLP 06/28/2019 1.5 AICPA Independence AICPA 06/03/2019 4.5 35 I eidebailly.com CITY OF DUBUQUE APPENDIX E: LEGAL AND INSURANCE EXCEPTIONS FOR CONSIDERATION Based on feedback from our firm's legal counsel, we have noted the following suggested modifications to the provided sample contract. We would be happy to discuss in more detail upon request. Category Page Appendix B Proposer Euarantcc Warranty 1 Reasoning: We cannot guaranty that the engagement will be completed. Appendix E 4. Indemnity [CPA Firm]will save,dcfcnd, hold harmless and indemnify the City and its elected 1 Agreement officials, employees, agents and officers from any claims arising directly or indirectly out of the performance of this Agreement which are the result of the negligent acts or omissions of the[CPA Firm], its employees, officers, and agents. Reasoning:The firm cannot agree to defend a client in claims sounding in professional liability. The firm's professional liability insurance policies provide a defense to the firm; they do not provide a defense to firm's clients. Places firm in position where any defense obligation is borne solely by firm and its partners. As a practical matter, absent unequivocal admission of liability, defense requirement is unworkable. Defense requirement results in a conflict of interest for firm and any attorney retained to represent the client in a dispute. If firm is negligent or violated professional standards, attorneys fee shifting provision elsewhere in the paragraph/contract puts client in same place as if firm had defended client. Insurance Schedule 11. The City of Dubuque reserves the right to require complete,certified copies of all 1 required insurance policies, including endorsements, required by this Schedule at any time. Reasoning: We can provide certificates of insurance along with any required endorsements. However, the terms and conditions of the firm's insurance policies are the firm's confidential business information that, as a matter of longstanding firm policy, is not disclosed outside the firm. In lieu of disclosure, the firm would be glad to provide a letter from its insurers stating(in effect)that the policy terms are reasonable and within the market range. 36 I eidebailly.com CITY OF DUBUQUE APPENDIX F: ACKNOWLEDGEMENT OF ADDENDA Eide Bailly acknowledges the receipt of the following addenda: Addendum #1: Audit Services RFP Question Responses/Clarifications, April 4, 2022 Addendum #2: Audit Services RFP Question Responses/Clarifications, April 11, 2022 37 I eidebailly.com 4 111 LTURE THE FOUNDATION OFèUCCESS Caring for our external and internal clients with a passion to go the extra mile. Respecting our peers and their individual contributions. Conducting ourselves with the highest level of integrity at all times. Trusting and supporting one another. Being accountable for the overall success of the firm, not just individual or office success. Stretching ourselves to be innovative and creative, while managing the related risks. Recognizing the importance of maintaining a balance between work and home life. Promoting positive working relationships. And, most of all, enjoying our jobs ... and having fun! EideBailly® What inspires you, inspires us. eidebailly.com EideBai11 . Y CPAs&BUSINESS ADVISORS Cost Proposal for Annual Auditing Services CITY OF DUBUQUE April 22, 2022 Submitted By: Eide Bailly LLP Brian Unsen, CPA- Partner 1545 Associates Dr., Suite 101 563.557.6152 I bunsen@eidebailly.com Dubuque, IA 52002-2299 CITY OF DUBUQUE Dollar Cost Bids 1. Total All-Inclusive Maximum Price Eide Bailly LLP submits this dollar cost bid as part of a proposal response to the RFP issued to provide annual auditing services for the City of Dubuque (City). Authorized Representative: As a partner of Eide Bailly, Brian Unsen, is authorized to represent the firm, empowered to submit the bid and authorized to sign a contract with the City of Dubuque. Our fees are based on the complexity of the issue and the experience level of the staff members necessary to address it. PROPOSAL FOR AUDIT SERVCES ALL-INCLUSIVE MAXIMUM PRICE SUMMARY FOR THE CITY OF DUBUQUE Fee for each Additional Major Proposal for Audit Services: Total Price Program (over 5) Price of First Year of Engagement (FY22) $ 83,000 $ 4,000 Price of Second Year of Engagement (FY23) $ 87,000 $ 4,200 Price of Third Year of Engagement (FY24) $ 91,000 $ 4,400 Price of Fourth Year of Engagement (FY25) $ 95,000 $ 4,600 Price of Fifth Year of Engagement (FY26) $ 99,000 $ 4,800 Total All-Inclusive Maximum Price $455,000 Maximum Conversion Audit Cost for ERP $ - (A) Proposal of Eide Bailly Address 1545 Associates Drive, Suite 101, Dubuque, Iowa 52002-2299 Authorized Signer Brian Unsen Date April 22, 2022 (A) No additional fees would be billed related to the City's ERP conversion. WHAT INSPIRES YOU,INSPIRES US. EIDEBAILLY.COM CITY OF DUBUQUE 2. Rates by Partner, Specialist, Supervisory and Staff Level Times Hours Anticipated for Each SCHEDULE OF PROFESSIONAL FEES AND EXPENSES FOR THE AUDIT OF THE 2022 FINANCIAL STATEMENTS FOR THE CITY OF DUBUQUE Employee Hourly Classification Hours Rates Total Partners 120 $ 200 $ 24,000 Managers 140 180 25,200 Senior 140 160 22,400 Staff 270 150 40,500 Other 30 120 3,600 Subtotal 700 115,700 Out-of-Pocket Expenses - Adjustment to Maximum Price (32,700) Total all-inclusive maximum price for FY 2022 audit engagement $ 83,000 WHAT INSPIRES YOU,INSPIRES US. I EIDEBAILLY.COM CITY OF DUBUQUE SCHEDULE OF PROFESSIONAL FEES AND EXPENSES FOR THE AUDIT OF THE 2023 FINANCIAL STATEMENTS FOR THE CITY OF DUBUQUE Employee Hourly Classification Hours Rates Total Partners 120 $ 205 $ 24,600 Managers 140 185 25,900 Senior 140 165 23,100 Staff 270 155 41,850 Other 30 125 3,750 Subtotal 700 119,200 Out-of-Pocket Expenses - Adjustment to Maximum Price (32,200) Total all-inclusive maximum price for FY 2023 audit engagement $ 87,000 WHAT INSPIRES YOU,INSPIRES US. I EIDEBAILLY.COM CITY OF DUBUQUE SCHEDULE OF PROFESSIONAL FEES AND EXPENSES FOR THE AUDIT OF THE 2024 FINANCIAL STATEMENTS FOR THE CITY OF DUBUQUE Employee Hourly Classification Hours Rates Total Partners 120 $ 210 $ 25,200 Managers 140 190 26,600 Senior 140 170 23,800 Staff 270 160 43,200 Other 30 130 3,900 Subtotal 700 122,700 Out-of-Pocket Expenses - Adjustment to Maximum Price (31,700) Total all-inclusive maximum price for FY 2024 audit engagement $ 91,000 WHAT INSPIRES YOU,INSPIRES US. I EIDEBAILLY.COM CITY OF DUBUQUE SCHEDULE OF PROFESSIONAL FEES AND EXPENSES FOR THE AUDIT OF THE 2025 FINANCIAL STATEMENTS FOR THE CITY OF DUBUQUE Employee Hourly Classification Hours Rates Total Partners 120 $ 215 $ 25,800 Managers 140 195 27,300 Senior 140 175 24,500 Staff 270 165 44,550 Other 30 135 4,050 Subtotal 700 126,200 Out-of-Pocket Expenses - Adjustment to Maximum Price (31,200) Total all-inclusive maximum price for FY 2025 audit engagement $ 95,000 WHAT INSPIRES YOU,INSPIRES US. I EIDEBAILLY.COM CITY OF DUBUQUE SCHEDULE OF PROFESSIONAL FEES AND EXPENSES FOR THE AUDIT OF THE 2026 FINANCIAL STATEMENTS FOR THE CITY OF DUBUQUE Employee Hourly Classification Hours Rates Total Partners 120 $ 220 $ 26,400 Managers 140 200 28,000 Senior 140 180 25,200 Staff 270 170 45,900 Other 30 140 4,200 Subtotal 700 129,700 Out-of-Pocket Expenses - Adjustment to Maximum Price (30,700) Total all-inclusive maximum price for FY 2026 audit engagement $ 99,000 WHAT INSPIRES YOU,INSPIRES US. I EIDEBAILLY.COM CITY OF DUBUQUE 3. Out-of-Pocket Fees The professional fees listed above are inclusive of all out-of-pocket expenses and you will not be billed for expenses such as travel time, mileage and meals. 4. Rates for Additional Professional Services If you request additional services,we'll obtain your agreement on fees before commencing work to avoid surprises or hidden fees. Standard Hourly Rates Staff Level 2022 Partner $200 Manager $180 Senior $160 Staff $150 Other $120 Billing Policy Regarding Telephone Inquiries We know clients appreciate access to all their service team members. We embrace this opportunity for constant communication and will ensure our team members are available when you have questions and issues.This service is included in the scope of the engagement. If a particular issue surfaces that falls outside the scope of this engagement, we'll bring it to your attention and obtain approval before proceeding. 5. Manner of Payment Invoices are presented as the work progresses, with an initial invoice at the completion of the interim fieldwork, a second invoice at the completion of fieldwork and a final invoice following issuance of the audit report. 6. Tax-Exempt Entity We understand the City is a tax-exempt entity and no taxes have been included in fee calculations. WHAT INSPIRES YOU,INSPIRES US. I EIDEBAILLY.COM