Auditing Services RFP's
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MEMORANDUM
January 21, 2006
TO:
The Honorable Mayor and City Council Members
FROM:
Michael C. Van Milligen, City Manager
SUBJECT: Request for Proposal (RFP) for Professional Auditing Services
Finance Director Ken T eKippe recommends City Council approval of the issuance of a
Request for Proposals for professional auditing services for fiscal years ending June 30,
2006 through June 30,2010. The City is required to have annual audits of its financial
records by an independent public accounting firm.
In 2001 the City issued an RFP for professional auditing services for the five fiscal years
ended June 30, 2001 through June 30, 2005. Eide Bailly, LLP has performed auditing
services for the City of Dubuque for the past five years based on the 2001 RFP.
Recently the Comprehensive Annual Financial Report (CAFR) and other information for
fiscal year ended June 30, 2005, was provided to the City Council. It is the appropriate
time to select a firm for future years' audits to allow proper planning for the audit.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
;LLJ ~jJJ1L-
MicKael C. Van Milligen
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
Ken TeKippe, Finance Director
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GiI Spence
Chris Kohlmann
Rick Till
Leisure Services Manager
Information Services Manager
Financial Analyst
The following local firms with the capacity to perform the audit have been identified to
receive solicitation letters inviting proposals:
Eide Bailly, LLP
Honkamp Krueger & Co., CPA's
McGladrey & Pullen, LLP
O'Connor Brooks & Co., CPA's
If additional firms contact the City after the RFP has been authorized for release, they
will be allowed to submit a proposal.
RECOMMENDED ACTION
The recommended action at the February 6, 2006 meeting is for the City Council to
authorize the release of the RFP to public accounting firms to receive proposals for
auditing services for the City of Dubuque.
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Enclosure
City of Dubuque
REQUEST FOR PROPOSAL
FOR
PROFESSIONAL AUDITING SERVICES
February 7, 2006
Finance Department
City Hall
50 West 13th Street
Dubuque, Iowa 52001-4864
City of Dubuque
Request for Proposal
TABLE OF CONTENTS
I. INTRODUCTION
A. General Information
B. Term of Engagement
C. Subcontracting
II. NATURE OF SERVICES REQUIRED
A. General
B. Scope of Work to be Performed
C. Auditing Standards to be Followed
D. Reports to be Issued
E. Special Considerations
F. Working Paper Retention and Access to Working Papers
III. DESCRIPTION OF THE GOVERNMENT
A. General Description/Contact Person
B. Fund Structure
C. Budgetary Basis of Accounting
D. Federal and State Financial Assistance
E. Pension Plans
F. Component Unit
G. Joint Ventures
H. Magnitude of Finance Operations
I. Computer Systems
J. Internal Audit Function
K. Availability of Prior Audit Reports
IV. TIME REQUIREMENTS
A. Proposal Calendar
B. Anticipated Notification and Contract Dates
C. Schedule for the Fiscal Year 2006 Audit
I. Detail Audit Plan
2. Fieldwork
3. Draft Reports
4. Final Reports
5. Conferences and Progress Reports
V. ASSISTANCE TO BE PROVIDED TO THE AUDITOR AND REPORT PREPARATION
A. Finance Department and Clerical Assistance
B. Electronic Data Processing (EDP) Assistance
C. Work Area, Telephone, Photocopying and FAX Machine
D. Report Preparation
VI. PROPOSAL REQUIREMENTS
A. General Requirements
I. Submission of Notification of Interest
2. Written Questions and Inquiries
3. Addendas
4. Submission of Proposals
B. Technical Proposal
1. General Requirements
2. Independence
3. License to Practice in Iowa
4. Firm Qualifications and Experience
5. Partner, Supervisory and Staff Qualifications and Experience
6. Similar Engagements with Other Government Entities
7. Specific Audit Approach
8. Identification of Anticipated Potential Audit Problems
C. Sealed Dollar Cost Bid
1. Total All-Inclusive Maximum Price
2. Rates by Partner, Specialist, Supervisory and Staff Level Times Hours
Anticipated for Each.
3. Out-of-pocket Expenses Included in the Total All-inclusive Maximum Price and
Reimbursement Rates.
4. Rates for Additional Professional Services
5. Manner of Payment
VII. EV ALUA nON PROCEDURES
A. Audit Committee
B. Review of Proposals
C. Evaluation Criteria
1. Mandatory Elements
2. Technical Qualifications
3. Price
D. Oral Presentations
E. Final Selection
F. Right to Reject Proposals
APPENDICES
A. City Fund Structure
B. Proposer Guarantee
C. Proposer Warranties
D. I. Format for Proposal for Audit Services All-Inclusive Maximum Price Summary
2. Format for Schedule of Professional Fees and Expenses to Support the Total All-
Inclusive Maximum Price
E. Anticipated Audit Service Agreement
Reports Included:
Comprehensive Annual Financial Report for FY 2005
Parking Facilities Financial Statements for FY 2005
Dubuque Metropolitan Area Solid Waste Agency (DMASW A) Financial Statements for
FY 2005
Dubuque Regional Airport Passenger Facility Charges Audit for FY 2005
City of Dubuque
REQUEST FOR PROPOSAL (RFP)
I. INTRODUCTION
A. General Information
The City of Dubuque is requesting proposals from qualified firms of certified public
accountants to audit its financial statements for five fiscal years ending June 30, 2006
through June 30, 2010. The annual audits are to be performed in accordance with
generally accepted auditing standards, Chapter 11 of the Code of Iowa, and any other
provisions applicable to audits of local government contained in the Code of Iowa, the
standards set forth for financial audits in the General Accounting Office's (GAO)
Government Auditina Standards, the Single Audit Act Amendments of 1996 and Office
of Management and Budget (OMB) Circular A-133 Audits of States. Local Governments
and Non-Profit Oraanizations.
There is no expressed or implied obligation for the City of Dubuque to reimburse
responding firms for any expenses incurred in preparing proposals or potential
interviews in response to this request.
Eight copies of the proposal must be received by Ken TeKippe, Finance Director, at City
Hall, 50 West 13th Street, Dubuque, Iowa 52001 by 5:00 p.m. on March 6,2006. The
City of Dubuque reserves the right to reject any or all proposals submitted.
The proposals submitted will be evaluated by an eight member Audit Committee of City
Employees. During the evaluation process, the Audit Committee and the City of
Dubuque reserve the right, where it may serve the City of Dubuque's best interest, to
request additional information or clarification from proposers, or to allow corrections of
errors/omissions. At the discretion of the Audit Committee and City of Dubuque, firms
submitting proposals may be requested to make oral presentations as part of the
evaluation process.
The City of Dubuque reserves the right to retain all proposals submitted and to use any
ideas in a proposal regardless of whether that proposal is selected. Submission of a
proposal indicates acceptance by the firm of the conditions contained in this request for
proposals, unless clearly and specifically noted in the proposal submitted and confirmed
in the contract between the City of Dubuque and the firm selected.
It is anticipated the selection of a firm will be completed by early April, 2006. Following
the notification of the selected firm it is expected a contract will be executed within three
weeks of City Council approval.
B. Term of Engagement
A five-year contract is anticipated, subject to an annual review and annual availability of
an appropriation.
C. Subcontracting
If subcontracting is anticipated, the name of the proposed subcontracting firm must be
clearly identified in the proposal. Following the award of the audit contract, no additional
subcontracting will be allowed without the prior written consent of the City of Dubuque.
II. NATURE OF SERVICES REQUIRED
A. General
The City of Dubuque is soliciting the services of qualified firms of certified public
accountants to audit its financial statements for the fiscal year ending June 30, 2006,
and each of the four (4) subsequent fiscal years. These audits are to be performed in
accordance with the provisions contained in this request for proposals. The auditor will
also be required to convert the City's accounting information from a cash basis to a
modified accrual/accrual basis as needed.
The auditor will be required to prepare a Comprehensive Annual Financial Report
(CAFR) that conforms to the format prescribed by the Government Finance Officers
Association (GFOA) guidelines for obtaining the "Certificate of Achievement for
Excellence in Financial Reporting." The CAFR shall be prepared on modified
accrual/accrual methods of accounting and shall be completed and delivered to the City
Finance Director by November 15th of each year unless another date is agreed to by
the City of Dubuque. The audit shall include a separate management letter, if
appropriate, which includes recommendations affecting the financial statements, internal
control, accounting systems, and legality of actions. The City will be responsible for the
Transmittal Letter, Management, Discussion and Analysis (MD&A), Statistical Section
(excluding schedules directly related to financial statements prepared by auditors), and
cover of the CAFR, as well as the reproduction and binding of the completed report.
Separate Financial Statements are required for Parking Facilities (enterprise), Dubuque
Metropolitan Area Solid Waste Agency (component unit), and Dubuque Regional Airport
Passenger Facility Charges (PFC) audit.
Financial reports for the above enterprise funds/component units must be prepared on
an accrual basis. The City maintains accounting records for these activities on a cash
basis and the audit firm is required to convert the records to accrual. If the City issues
additional revenue bonds, a separate report may be required. The separate financial
statements must be completed and delivered by September 30th of each fiscal year.
Copying, assembling and binding of the separate reports are the responsibility of the
auditor.
B. Scope of Work to be Performed
The City of Dubuque desires the auditor to express an opinion on the fair presentation of
its general purpose financial statements in conformity with generally accepted
accounting principles.
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The City of Dubuque also desires the auditor to express an opinion on the fair
presentation of its combining and individual fund and account group financial statements
and schedules in conformity with generally accepted accounting principles. The auditor
is required to audit the schedule of expenditures of federal awards. The auditor is not
required to audit the statistical section in the CAFR.
C. Auditing Standards To Be Followed
To meet the requirements of this RFP, the audit shall be performed in accordance with
generally accepting auditing standards as set forth by the American Institute of Certified
Public Accountants, Chapter 11 of the Code of Iowa, and any other provisions
applicable to audits of local government contained in the Code of Iowa, the standards of
financial audits set forth in the U.S. General Accounting Office's Government Auditing
Standards (1994 revision), the Single Audit Act Amendments of 1996 and OMB Circular
A-133, Audits of State. Local Governments and Non-Profit Organizations.
D. Reports to be Issued
Following the completion of the audit of the fiscal year's financial statements, the auditor
shall issue:
1. A report on the fair presentation of the financial statements in conformity with
generally accepted accounting principles.
2. A report on compliance and on internal control over financial reporting in
accordance with Government Auditing Standards.
3. A report on compliance with requirements applicable to its major programs and
internal control over compliance in accordance with OMB Circular A-133.
The auditor shall identify reportable conditions that are also material weaknesses in the
CAFR. In a letter to management the auditor shall communicate any reportable
conditions found during the audit. A reportable condition shall be defined as a significant
deficiency in the design or operation of the internal control structure, which would
adversely affect the organization's ability to record, process, summarize, and report
financial data consistent with the assertions of management in the financial statements.
Auditors shall be required to make an immediate written report of all irregularities and
illegal acts or indications of illegal acts of which they become aware to Michael C. Van
Milligen, City Manager.
. E. Special Considerations
1. The City of Dubuque will send its CAFR to the Government Finance Officers
Association for review in their "Certificate of Achievement for Excellence in
Financial Reporting" program. The auditor will be required to be familiar with the
requirements of the program and provide special assistance when needed.
2. The City of Dubuque anticipates it will prepare one or more official statements
annually in connection with the sale of debt securities (normally General
Obligation Bonds) which will contain the general purpose financial statements
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and the auditor's report thereon. The auditor shall be required, if requested by
the financial advisor and/or the underwriter, to issue a "consent and citation of
expertise" as the auditor and any necessary "comfort letters."
3. The City of Dubuque has determined that the United States Department of
Interior will function as the cognizant agency in accordance with the provisions of
the Single Audit Act Amendments of 1996 and U.S. Office of Management and
Budget (OMB) Circular A-133, Audits of State. Local Governments. and Non-
Profit OrQanizations.
4. The schedule of federal financial assistance and related auditor's report, as well
as the reports on the internal controls and compliance, are to be issued as part
of the CAFR.
The City of Dubuque will require the auditor's assistance to comply with any new
accounting principles that become effective during the period covered by this request for
proposal.
F. Working Paper Retention and Access to Working Papers
All working papers and reports must be retained, at the auditor's expense, for a
minimum of five (5) years, unless the firm is notified in writing by the City of Dubuque of
the need to extend the retention period. The auditor will be required to make working
papers available, upon request, to the following parties or their designees:
City of Dubuque, U.S. Department of Interior, Auditor of the State of Iowa,
parties designated by the federal or state governments or by the City of Dubuque
as part of an audit quality review process, auditors of entities of which the City of
Dubuque is a subrecipient of grant funds.
In addition, the firm shall respond to the reasonable inquiries of successor auditors and
allow successor auditors to review working papers relating to matters of continuing
accounting significance.
III. DESCRIPTION OF THE GOVERNMENT
A. General Description of Government/Contact Person
A list of City offered services may be found in the Transmittal Letter of the
ComprehenSive Annual Financial Report (available on the City website
www.citvofdubuQue.ora). Lists of elected and appointed officials and department
directors, and the City's organizational chart, are provided in the Introductory Section of
the CAFR. Further information on the City is provided in the CAFR Management's
Discussion and Analysis, and Statistical Sections.
The auditor's principal contact with the Gity of Dubuque will be Ken TeKippe, Finance
Director, (563) 589-4133, ktekippe@citvofdubuQue.orQ.
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B. Fund Structure
The City's current fund structure is provided in Appendix A.
C. Budgetary Basis of Accounting
The City of Dubuque prepares its budgets on a cash basis. Budgets are prepared for all
of the City's governmental and proprietary funds.
D. Federal and State Financial Assistance
The City of Dubuque receives federal financial assistance from several federal
programs; a listing of the programs and the Catalog of Federal Domestic Assistance
numbers is included on pages 102-104 of the FY 2005 CAFR. The City does not
anticipate major changes in the amount of Federal or State financial assistance over the
five year period covered by the contract.
E. Pension Plans
The City of Dubuque participates in the Municipal Fire & Police Retirement System of
Iowa (MFPRSI) and the Iowa Public Employees Retirement System (IPERS) pension
plans. Both plans are defined benefit, cost-sharing, multiple-employer plans
administered by state agencies.
F. Component Unit
The City of Dubuque is defined, for financial reporting purposes, in conformity with the
Governmental Accounting Standards Board's Codification of Governmental Accountino
and Financial Reportino Standards, Section 2100. Using these criteria, the Dubuque
Metropolitan Area Solid Waste Agency (DMASWA) is a component unit for inclusion in
the City of Dubuque's financial statements. The City provides for the operation and
management of the DMASWA sanitary landfill. This component unit is to be audited as
part of the audit of the City of Dubuque's financial statements and the cost included in
base audit cost.
G. Joint Ventures
The City of Dubuque does not currently participate in joint ventures with other
governments.
H. Magnitude of Finance Operations
The financial activities are performed by the City of Dubuque finance department. The
principal functions performed and the number of employees assigned to each are as
follows:
Function
Number of Emplovees
AccountingfT reasury /Pu rchasing/Payroll
Utility Billing/Parking Ticket Collection
Meter Service
6 FT, 2 PT
7 FT, 1 PT
1 FT, 1 PT
5
I. Computer Systems
Hardware
The City of Dubuque currently uses IBM RS 6000 server for all payroll, general ledger
and several sub-ledger systems including utility billing. The landfill and parking tickets
accounts receivable systems are operated on stand-alone PCs.
Software
The City of Dubuque utilizes an integrated financial software system developed by
Sungard Pentamation Inc.
J. Internal Audit Function
The City of Dubuque does not maintain an internal audit function.
K. Availability of Prior Audit Reports and Working Papers
Interested proposers who wish to review prior years' audit reports and management
letters should contact Ken TeKippe, Finance Director, at (563) 589-4133. The City of
Dubuque will use its best efforts to make prior audit reports and supporting working
papers available to proposers to aid their response to this RFP.
IV. TIME REQUIREMENTS
A. Proposal Calendar
The following is a list of key dates pertinent to the submission of proposals:
Solicitation for proposals issued
Due date for notification of interest
Due date for submitting proposals
February 7, 2006
February 17, 2006 (5:00 p.m.)
March 6, 2006 (5:00 p.m.)
B. Anticipated Notification and Contract Dates
Firms notified of selection
Contract date
April 4, 2006
April 25, 2006
C. Schedule for the Fiscal Year 2006 Audit
Each of the following should be completed by the auditor no later than the dates
indicated.
1 . Detailed Audit Plan
The auditor shall provide the City of Dubuque, by June 1, 2006, a detailed audit
plan and a list of all schedules and information to be provided by the City of
Dubuque.
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2. Fieldwork
The auditor shall complete all fieldwork by October 31, 2006. Assistance on the
HUD Section 8 Annual Settlement Statement will be required in late July and
early August, since this report is due on August 15.
3. Draft Reports
The auditor shall prepare draft financial statements, notes and all required
supplementary schedules and statistical data. The auditor shall have drafts of
the audit reports and recommendations to management available for review by
the Finance Department by November 15,2006.
4. Final Reports
The Finance Department will complete a review of the draft report as
expeditiously as possible. It is not expected that this process should exceed one
week. During that period, the auditor should be available for any meetings that
may be necessary to discuss the audit reports. Once all issues for discussion are
resolved, the final signed report, arranged in a format suitable for reproduction,
shall be delivered to Ken TeKippe, Finance Director, by November 30, 2006.
5. Conferences and progress reports.
Informal conferences and progress reports may be requested occasionally
throughout the audit process. The auditor must be prepared to provide
information at mutually agreeable meeting times. A presentation of the CAFR
subsequent to its completion may be requested. Attendance by the auditor at
the City Council meeting when the CAFR and management letter are approved
is required.
(Similar time schedules will be developed for audits of future fiscal years if the City of
Dubuque exercises its option for additional audits).
V. ASSISTANCE TO BE PROVIDED TO THE AUDITOR AND REPORT PREPARATION
A. Finance Department and Clerical Assistance
The Finance Department staff and responsible management personnel will be available
during the audit to assist the firm by providing information, documentation and
explanations. The preparation of confirmations will be the responsibility of the City.
In addition, clerical support will be made available to the audit firm for the preparation of
routine letters and memoranda.
B. Electronic Data Processing (EDI-') Assistance
EDP personnel will be available to provide systems documentation and explanations.
The auditor will be provided access to the City of Dubuque's computer hardware and
financial system software for inquiries and reports.
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C. Work Area, Telephones, Photocopying and FAX Machine
The City of Dubuque will provide the auditor adequate workspace and access to
necessary telephone lines, copy machine and a FAX machine.
D. Report Preparation
Converting the City's cash-basis financial statements to GAAP basis is the responsibility
of the audit firm.
CAFR preparation, editing and a final signed report, arranged in a format suitable for
reproduction, shall be the responsibility of the auditor. (City responsible for printing and
binding CAFR.)
Special reports preparation, editing and printing shall be the responsibility of the auditor.
VI. PROPOSAL REQUIREMENTS
A. General Requirements
1. Submission of Notification of Interest
Firms interested in submitting a proposal must submit by February 17, 2006
(5:00 p.m.) their "Notification of Interest" in the prescribed format. Failure to
return a "Notification of Interest" will disqualify firms from submitting a proposal.
2. Inquiries
Inquiries concerning the RFP must be made to:
Ken TeKippe, Finance Director
City of Dubuque
50 West 13th Street
Dubuque, Iowa 52001-4864
Office (563) 589-4133
Fax (563) 589-0890
E-mail: ktekiDDe@citvofdubuaue.ora
3. Submission of Proposals
The following material is required to be received March 6, 2006 (5:00 p.m.), for a
proposing firm to be considered:
a. A master copy (so marked) of a Technical Proposal and seven (7) copies
to include the following:
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i. Title Paae
Title page showing the RFP subject; the firm's name; the name,
address and telephone number of the contact person; and the
date of the proposal.
ii. Table of Contents
iii. Transmittal Letter
A signed letter of transmittal briefly stating the proposer's
understanding of the work to be done, the commitment to perform
the work within the time period, a statement why the firm believes
itself to be best qualified to perform the engagement and a
statement that the proposal is a firm and irrevocable offer for 90
days.
iv. Detailed Proposal
The detailed proposal should follow the order set forth in Section
VI. B. of this RFP.
v. Appendices
Executed copies of "Proposer Guarantee" and "Proposer
Warranties," attached to this request for proposal (Appendix B
and Appendix C).
b. The proposer shall submit an original and three (3) copies of a dollar cost
bid in a separate sealed envelope marked as follows:
SEALED DOLLAR COST BID
PROPOSAL
FOR
City of Dubuque
FOR
PROFESSIONAL AUDITING SERVICES
COMMENCING JUNE 30, 2006
c. Proposers should provide the completed proposal consisting of the two
separate envelopes to the following address:
Ken TeKippe, Finance Director
City of Dubuque
50 West 13th Street
Dubuque, IA 52001-4864
B. Technical Proposal
1. General Requirements
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The purpose of the Technical Proposal is to demonstrate the qualifications,
competence and capacity of the firms seeking to undertake an independent audit
of the City of Dubuque in conformity with the requirements of this RFP. As such,
the substance of proposals will carry more weight than their form or manner of
presentation. The Technical Proposal should demonstrate the qualifications of
the firm and of the particular staff to be assigned to this engagement. It should
also specify an audit approach that will meet the RFP requirements.
THERE SHOULD BE NO COSTS INCLUDED IN THE TECHNICAL
PROPOSAL DOCUMENT.
The Technical Proposal should address all the points outlined in the RFP
(excluding any cost information which should only be included in the sealed
dollar cost bid). The proposal should be prepared simply and economically,
providing a straightforward, concise description of the proposer's capabilities to
satisfy the requirements of the RFP. While additional data may be presented, the
following subjects, items Nos. 2 through 10, must be included. They represent
the criteria against which the proposal will be evaluated.
2. Independence
The firm should provide an affirmative statement that it is independent of the City
of Dubuque as defined by generally accepted auditing standards/the U.S.
General Accounting Office's Government AuditinQ Standards (1994 revision).
The firm also should provide an affirmative statement that it is independent of all
of the component units of the City of Dubuque as defined by those same
standards.
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.
In addition, the firm shall provide the City of Dubuque written notice of any
professional relationships entered into during the period of this agreement.
3. License to Practice in Iowa
An affirmative statement should be included that the firm and all assigned key
professional staff are properly registeredllicensed to practice in the state of Iowa.
4. Firm Qualifications and 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.
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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.
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.
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. 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.
Highlight activities in the governmental sector, including Special Designations,
consulting, membership in government organizations and sponsorship of
governmental CPEs.
5. Partner, Supervisory and Staff Qualifications and 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.
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.
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.
6. Similar Engagements With Other Government Entities
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For the firm's office that will be assigned responsibility for the audit, list the most
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, engagement partners, total hours, and the name and telephone number of
the principal client contact.
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 11 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.
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
c. Sample size and the extent to which statistical sampling is to be used in
the engagement
d. Extent of use of EDP software in the engagement
e. Type and extent of analytical procedures to be used in the engagement
f. Approach to be taken to gain and document an understanding of the City
of Dubuque's internal control structure
g. Approach to be taken in determining laws and regulations that will be
subject to audit test work
h. Approach to be taken in drawing audit samples for purposes of tests of
compliance
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.
C. Sealed Dollar Cost Bid
1. Total All-Inclusive Maximum Price
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The sealed dollar cost bid 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 sealed dollar cost bid. Such costs
should not be included in the proposal.
The first page of the sealed dollar cost bid should include the following
information (See Appendix D, page 1):
a. Name of Firm
b. Certification that the person signing the proposal is entitled to represent
the firm, empowered to submit the bid, and authorized to sign a contract
with the City of Dubuque.
c. A summary of all-inclusive price for each individual year of the
engagement.
d. A total all-inclusive maximum price for the five (5) year engagement.
2. Rates by Partner, Specialist, Supervisory and Staff Level Times Hours
Anticipated for Each.
Pages two (2) through six (6) of the sealed dollar cost bid should include a
schedule of professional fees and expenses that supports the total all-inclusive
price for the 2006 fiscal year of the engagement and each of the four (4)
subsequent fiscal years, presented in a format similar to Appendix D, page 2.
For Section liE 5., disclose the cost of services to be provided.
3. Out-of-pocket Expenses Included in the Total All-inclusive Maximum Price and
Reimbursement Rates.
Out-of-pocket expenses (Le. travel, lodging, etc.) for firm personnel will be
reimbursed. All estimated out-of-pocket expenses to be reimbursed should be
presented in the sealed dollar cost bid in a format similar to Appendix D, page 2.
All expense reimbursements will be charged against the total all-inclusive
maximum price submitted by the firm.
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 resuit 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 sealed dollar cost bid.
13
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.
VII. EVALUATION PROCEDURES
A. Audit Committee
Proposals submitted will be evaluated by an eight-member Audit Committee of City
employees.
B. Review of Proposals
The Audit Committee will use a point formula during the review process to score
proposals. Each member of the Audit Committee will first score each technical proposal
by each of the criteria described in Section VII.C. below. The Audit Committee will
determine a composite technical score for each firm, based on a combination of the
individual scores. At this point, firms with an unacceptably low technical score will be
eliminated from further consideration.
After the composite technical score for each firm has been established, the sealed dollar
cost bid will be opened and additional points will be added to the technical score based
on the price bid. The maximum score for price will be assigned to the firm offering the
lowest total all-inclusive maximum price. Appropriate fractional scores will be assigned
to other proposers.
The City of Dubuque reserves the right to retain all proposals submitted and use any
idea in a proposal regardless of whether that proposal is selected.
C. Evaluation Criteria
Proposals will be evaluated using three sets of criteria. Firms meeting the mandatory
criteria will have their proposals evaluated and scored for both technical qualifications
and price. The following represent the principal selection criteria which will be
considered during the evaluation process.
1. Mandatory Elements
a. The audit firm is independent and licensed to practice in the state of
Iowa.
b. The firm has no conflict of interest with regard to any other work
performed by the firm for the City of Dubuque.
14
c. The firm adheres to the instructions in this RFP on preparing and
submitting the proposal.
d. The firm submits a copy of its last external quality control review report
and the firm has a record of quality audit work.
2. Technical Qualiifications: (Maximum Points - 75)
a. Expertise and Experience
1. The firm's past experience and performance on comparable
government engagements
2. The quality of the firm's professional personnel to be assigned to the
engagement and the quality of the firm's management support
personnel to be available for technical consultation
3. The firm's experience with federal and state financial assistance
programs.
b. Audit Approach
1. Adequacy of proposed staffing plan for various segments of the
engagement
2. Adequacy of sampling techniques
3. Adequacy of analytical procedures
3. Price: (Maximum Points - 25)
D. Oral Presentations
During the evaluation process, the Audit Committee may request one or more firms to
make oral presentations. Such presentations will provide firms with an opportunity to
answer any questions the Audit Committee may have on a firm's proposal. All firms may
not be asked to make oral presentations.
E. Final Selection
The City of Dubuque will select a firm based upon the recommendation of the Audit
Committee. The recommendation of the committee will be subject to approval of the City
Manager and City Council.
It is anticipated that a firm will be selected by April 4, 2006. Following notification of the
firm selected, it is expected a contract will be executed between both parties by April 25,
2006.
15
F. Right to Reject Proposals
Submission of a proposal indicates acceptance by the firm of the conditions contained in
this request for proposal unless clearly and specifically noted in the proposal submitted
and confirmed in the contract between the City of Dubuque and the firm selected.
The City of Dubuque reserves the right without prejudice to reject any or all proposals.
Thank you for your firm's interest in providing audit services to the City of Dubuque.
16
FUND
APPENDIX A
CITY OF DUBUQUE
FUNDS AND FUND GROUPS
FUND DESCRIPTION
FUND
FUND DESCRIPTION
GENERAL
100 GENERAL
101 DRA GAMING
102 DRA DISTRIBUTION
DEBT SERVICE
400 DEBT SERVICE
440 GO BOND PROCEEDS
SPECIAL
200
205
210
212
220
222
230
232
240
241
242
249
250
255
260
262
265
270
271
275
280
290
295
CAPITAL
300
350
360
370
380 .
390
391
395
TORT L1ABILllY
TRUST & AGENCY
TIF-METRIXlNORDSTROM
TIF-QUEBECOR
TIF ADV DATA COMM TECH PK
TIF - CARTEGRAPH
TIF - E. 7TH STREET
TIF - KERPER BLVD
TIF-DOWNTOWN
TIF-DOWNTOWN LOAN POOL
TIF-ICE HARBOR
TIF-SWlSS VALLEY ECON DEV
ROAD USE TAX
SPECIAL ASSESSMENT
COMMUNllY DEVELOPMENT
COMM DEV DISCRETION
UDAG REPAYMENTS
STATE RENTAL REHAB
STATE HOME PROGRAM
LEAD PAINT GRANT
SECTION 8 HOUSING
CABLE TV
EXPEND LIBRARY GIFTS TRST
PERMENANT
500 LYONS PEONY TRUST
550 LIBRARY GIFTS TRUST
ENTERPRISE
600 TRANSIT
610 SEWAGE UTI LIlY OPERATION
620 STORM WATER UTI LIlY O&M
630 PARKING OPERATIONS
640 WATER UTI LIlY OPERATION
670 REFUSE COLLECTION
700 AMERICA'S RIVER PROJECT
710 SANITARY SEWER CONST
720 STORM WATER CONSTRUCTION
730 PARKING FACILllY CONST
740 WATER CONSTRUCTION
INTERNAL SERVICE
800 ENGINEERING SERVICE
810 GARAGE SERVICE
820 GENERAL SERVICE
830 STORES/PRINTING
860 HEALTH INS RESERVE
880 WORKERS' COMP RESERVE
STREET CONSTRUCTION
SALES TAX CONSTRUCTION
GENERAL CONSTRUCTION
GOLF CONSTRUCTION
DOG TRACK CONSTRUCTION
AIRPORT CONSTRUCTION
PASSENGER FACILllY
PARKING-DOCK FACIL DEPR
AGENCY
910 DOG TRACK DEPRECIATION
COMPONET UNIT
940 DMASWA-GENERAL
941 DMASWA-DNR PLANNING
17
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):
Title:
Firm:
Date:
18
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):
Title:
Firm:
Date:
19
APPENDIX D
Page 1
PROPOSAL FOR AUDIT SERVICES
ALL-INCLUSIVE MAXIMUM PRICE SUMMARY
FOR THE CITY OF DUBUQUE
Proposal for Audit Services:
Price of First Year of Engagement
(FY06)
$
Price of Second Year of Engagement
(FY07)
$
Price of Third Year of Engagement
(FY08)
$
Price of Forth Year of Engagement
(FY09)
$
Price of Fifth Year of Engagement
(FY10)
$
Total All-Inclusive Maximum Price
$
Proposal of
Address
Authorized Signer
Date
20
APPENDIX D
Page 2
SCHEDULE OF PROFESSIONAL FEES AND EXPENSES
FOR THE AUDIT OF THE [YEAR] FINANCIAL STATEMENTS
FOR THE CITY OF DUBUQUE
Employee
Classification
Hours
Hourly
Rates
Total
Partners
Managers
Supervisory Staff
Staff
Clerical
Other (specify):
Subtotal
Out-of-Pocket Expenses:
Meals and lodging
Transportation
Other (detail):
Adjustment to Maximum Price
Total all-inclusive maximum price for FY 2006 audit engagement $
(Schedule Must Be Completed for Each of Five Audit Years)
21
APPENDIX E
Page 1
AUDIT SERVICE AGREEMENT BETWEEN
THE CITY OF DUBUQUE, IOWA
AND
[CPA FIRM]
This Agreement is entered into this _ day of April, 2006, between the City of
Dubuque (City) and [CPA Firm].
RECITALS
WHEREAS, City desires to obtain the services of [CPA Firm] to perform the annual
audit as required by Iowa Code Section 11.6 for the five years ending June 30, 2006;
June 30, 2007; June 30, 2008; June 30, 2009; and June 30, 2010; and
WHEREAS, [CPA Firm] desires to perform the audit services for City with the terms and
conditions set forth in this Agreement; and
WHEREAS, this Agreement is in the public interest in fulfilling the requirements of Iowa
Code Chapter 11.
NOW, THEREFORE, in consideration of the foregoing recitals and the covenants and
conditions set forth in this Agreement, the parties agree as follows:
1. Services:
[CPA Firm] shall provide audit and financial reporting services to City as
specified in attached Proposal dated , 2006 and the attached
Request for Proposal for Professional Auditing Services dated February 7,2006.
2. Reauirements:
[CPA Firm] agrees to all representations, commitments, and warranties
presented in their proposal. Exceptions to any part of the requirements must be
clearly identified. The order of precedence shall be: [CPA Firm's] signed Audit
Service Agreement, proposal, and the RFP.
3. Insurance:
22
APPENDIX E
Page 2
[CPA Firm] shall provide information on current insurance coverage for
professional liability (minimum of $1 ,000,000) and any changes during the term
of this agreement.
4. Conditions of Pavment:
City agrees to pay fees for services as stated in the attached Schedule of
Professional Fees and Expenses (see appendix D of RFP). The annual audit
shall be paid as earned on a monthly billing cycle. Ten percent of the earned fee
may be retained until completion of the audit and financial reports issued.
Payment shall be made within 30 days of receipt of invoice. [CPA Firm] agrees
to provide an itemized statement of total audit expenses at completion of the
audit in the format required by the Auditor of the State of Iowa.
5. Termination of AQreement:
City may terminate this Agreement at any time by giving written notice to [CPA
Firm] if City determines in its sole judgment that [CPA Firm] fails to perform the
covenants or agreements contained herein. City may also cancel the audit
services for any specific Fiscal Year if City is advised by the Auditor of the State
of the Auditor's intent to conduct the audit.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set
forth above.
CITY
[CPA FIRM]
By
By
Name (Print)
Name (Print)
Title
Title
Date
Date
23
February 7, 2006
Firm Name
Address
City, State, Zip
Dear:
The City of Dubuque is soliciting proposals from qualified firms of Certified Public
Accountants to audit the City of Dubuque's financial statements for the fiscal year
ending June 30, 2006, with the option of auditing the City of Dubuque's financial
statements for the four subsequent fiscal years. Audit firms expressing interest will be
provided with the City of Dubuque Request For Proposal (RFP) and related financial
reports.
To be considered for this engagement, your firm must meet the qualifications and
satisfy the requirements set forth in the RFP. Please indicate your interest in receiving a
copy of the RFP by using the format of the enclosed Notification of Interest and
returning to the address listed below no later that February 17, 2006.
Ken TeKippe
City of Dubuque
City Hall
50 West 13th Street
Dubuque, Iowa 52001-4864
Questions can be directed to Ken TeKippe in writing, bye-mail
(ktekiooe@citvofdubuque.orq), or by calling (563) 589-4133. Contact with other City of
Dubuque personnel regarding this RFP may be grounds for elimination from the
selection process.
Sincerely,
Kenneth J. TeKippe
Finance Director
KT/jg
Enclosure
[ACCOUNTING FIRM'S LETTERHEAD]
Date
Ken TeKippe, Finance Director
City of Dubuque
City Hall
50 West 13th Street
Dubuque, Iowa 52001
NOTIFICATION OF INTEREST
Dear Mr. TeKippe:
Our firm is interested in submitting a proposal to audit the City of Dubuque's financial
statements for the fiscal year ending June 30, 2006, with the option of auditing the City
of Dubuque's financial statements for the four subsequent fiscal years. Please supply a
copy of the Request for Proposal to our firm.
[AUDIT FIRM]