REQUEST FOR PROPOSAL TOWN AUDITING SERVICES TOWN OF LONGMEADOW MASSACHUSETTS Saved as: RPF Acct Auditing Services FY 12-14 03/1/11
TOWN OF LONGMEADOW REQUEST FOR PROPOSALS FOR AUDITING SERVICES The Town of Longmeadow, Massachusetts invites qualified, independent public accountants, licensed to practice in the Commonwealth of Massachusetts, to submit proposals to conduct an audit of its financial accounts and records in accordance with the specifications listed below. Specifically, the Town of Longmeadow is seeking proposals for auditing services for Fiscal year 2012, 2013 and 2014. Specifications are available from the Town of Longmeadow, Attn: Chad Thompson, Procurement Manager, 735 Longmeadow Street, Suite 101, Longmeadow, MA 01106. Phone: 413-565-4136, Email: cthompson@longmeadow.org. Proposals should be submitted to the Chad Thompson at the same address in a sealed envelopes clearly marked Audit Proposal and should be received no later than 10:00 a.m. April 29, 2011. Late proposals will be rejected. Contracts with labor relations representatives, lawyers, designers, or certified public accountants are exempt per M.G.L. c.30b, Section 1(b)(15), however, the Town of Longmeadow is soliciting proposals using a Request for Proposal(RFP) format. Unlike the standard RFP format where separate technical and price proposals are required, those submitting proposals may submit both technical and price proposal information in a single document. The Town of Longmeadow acting through the Town Manager, the Awarding Authority reserves the right to reject any and all proposals, waive minor informalities, and award in the best interest of the Town. I. INFORMATION FURNISHED TO PROPOSER A. General Information 1. The Town of Longmeadow has a population of approximately 16,000 and a total operating budget for the fiscal year 2011 of nearly $53 million. The operations are under the direction of a Town Manager and the Town is further governed by a 5 member Select Board and an Open Town Meeting legislative branch. The current work force of the Town is approximately 875 The Town currently is in the middle of a $78 million High School Addition / Renovation project. The anticipated completion of the project is the summer of 2013. Additional information regarding the Town is also available on the Town s website. The fiscal year 2010 audit was performed by Scanlon & 2
Associates, LLC. The same firm is under contract to complete the fiscal year 2011 audit. The opinion for FY 2010 is unqualified and is expected to be unqualified for FY 2011. The 2010 audit report and management letter is available upon request to Paul J. Pasterczyk, Finance Director, 735 Longmeadow Street, Longmeadow, MA 01106 or PPasterczyk@Longmeadow.org. B. Description of Records 1. The Town maintains its general ledger in accordance with the Massachusetts Uniform Municipal Accounting System established by the Bureau of Accounts on a modified accrual basis. 2. Most financial records of the Town have been converted to an automated system (Munis). Areas that have not been fully converted include bank reconciliations and fixed assets. 3. Cash, Accounts Receivable and Interdepartmental reconciliations will be made by the Town at yearend. C. Nature of Services Required 1. Required services consist of an examination of the Town s financial records, including but not limited to, all fund activity including cash receipts and disbursements, accounts receivables, along with the Treasurer s and Collector s cash management program. This examination is to be performed in accordance with generally accepted auditing standards applicable to financial audits contained in the most recent Government Auditing Standards, issued by the Comptroller General of the United States. This financial audit shall cover the fiscal years ending June 30, 2012, 2013 and 2014. 2. In addition to the financial audit, the proposer is to conduct an audit in accordance with the following 3
requirements: Single Audit Act of 1984 (P.L. 98-502), the Single Audit Act Amendments of 1996 and the regulations established to implement this law by the Director of the Office of Management and Budget O.M.B. Circular A-133. This compliance audit shall cover the fiscal year ending June 30, 2012, 2013 and 2014. 3. Prior to commencement of the annual audit, a schedule of information needed from each department is to be submitted to the Finance Director for distribution to involved departments. 4. At the conclusion of the audit, representatives of the accounting firm will be requested to appear before Town officials to discuss the findings resulting from the audit. 5. In addition to completing the annual audit, the accounting firm shall be available during business hours by phone and e-mail, throughout the contract period, to provide the Town with advice and guidance on routine financial accounting and reporting issues. The accounting firm is also expected to keep the Town abreast of the working requirements of all new accounting and financial reporting pronouncements of the Government Accounting Standards Board, the United States Office of Management and Budgets and the Commonwealth of Massachusetts. 6. All audit work papers are the property of the auditors and shall be retained for a period of at least seven years. Work papers shall be available for examination or duplication without charge to authorized Town personnel, representatives of Federal or State Agencies upon request of that Agency or the Town in accordance with Federal Law, State Law and other regulations. Working papers will also be made available for examination, at charge, or duplication, at a reasonable charge, to subsequent auditors engaged by the Town. 4
D. Reporting Requirements 1. The following auditor s reports are required at the completion of the audit: a. An auditor s opinion as to whether the general purpose financial statements fairly represent the financial position of the Town and the results of its financial operations in accordance with generally accepted accounting principals. In addition, the audit must contain an auditor s opinion whether the supplemental statement of federal assistance presents fairly the actual grant data in relation to the general-purpose financial statements. The supplemental statement of federal assistance must show the total expenditures for each federal assistance program. All financial statements and notes presented in the audit shall be in conformity with Governmental Accounting Standards Board (GASB) Codification of Governmental Accounting and Financial Reporting Standards and other applicable pronouncements. b. An auditor s statement whether an internal control system exists to provide reasonable assurance that funds are managed in compliance with applicable laws and regulations. Further, the auditor s report must identify the Town s significant internal accounting controls designed to provide for compliance. The auditor shall report the controls that were evaluated, and the material weaknesses identified as a result of the evaluation. c. An auditor s statement on compliance with grant requirements. The statement shall include: a statement of positive assurance with respect to those items tested for compliance, including compliance with law and regulations pertaining to financial reports and claims for advances and reimbursements; negative assurance on those items not tested; a summary of all instances of 5
noncompliance, and an identification of total amounts questioned, if any, for each federal assistance award, as a result of noncompliance. d. A management letter, which shall identify any management weaknesses observed and the assessed effect on financial management. Prior to completion of the management letter, the auditor shall meet with the Finance Director to review the findings and recommendations in detail. The final copy of the management letter shall contain printed responses for each finding. 2. The accounting firm will print, bind and submit as many copies of the aforementioned reports as is necessary to satisfy the Town s reporting requirements to state and federal regulatory and oversight agencies plus 10 bound copies and 1 electronic version to the Town. 3. The accounting firm will hold an exit conference with Town officials to review draft copies of the aforementioned reports before such reports are issued. E. Timing Considerations 1. RFP Documents can be downloaded at www.longmeadow.org, select the Purchasing Dept tab, then select the link labeled Bid & RFP Finder, then you will see the link to obtain the document by title: RFP: Town Auditing Services. 2. Questions regarding the audit must be submitted in writing to Chad Thompson, Purchasing Manager, 735 Longmeadow Street, Longmeadow, MA 01106 or cthompson@longmeadow.org by April 22, 2011 3. Two copies of the proposals in sealed envelopes plainly marked Audit Proposal will be accepted by: Chad Thompson, Purchasing Manager 735 Longmeadow Street, Suite 101 Longmeadow, MA 01106 until 10:00 a.m. on Friday April 29, 2011. 4. The proposals will be publicly opened on Friday April 29, 6
2011 at 10:00am immediately following the proposal deadline, at which time the name, total audit hours, and composite hourly rate will be recorded and announced. Firms are encouraged to attend this public meeting. 5. No proposal received by the Town after the time established herein for the receipt of the bids will be considered, regardless of the cause for the delay in the receipt of the bid. 6. The audit contract award is scheduled to be made by June 21, 2011, but is subject to change. 7. The tentative date for which preliminary work may begin is Tuesday, July 1, 2011 8. The draft reports will be reviewed with the Town officials at a meeting to be held no later than the end of December of each year for the audit of the preceding fiscal year. 9. The final audit reports will be completed by the end of January of each year for the audit of the preceding fiscal year and a presentation of such reports will be made to Town officials at a mutually agreed upon time. F. Award of Contract and Rejection of Proposals 1. Award will be based on a combination of price, experience and ability to complete the work in accordance with the schedule. (See Attachment A) 2. The Town of Longmeadow, acting through the Town Manager, the awarding authority, reserves the right to reject any and all proposals if the Town Manager, in her sole discretion deems it for the best interest of the Town of Longmeadow to do so. 3. The Town of Longmeadow reserves the right to accept a Proposal which is not the lowest in price if the Town Manager deems it to be for the best interest of the Town of Longmeadow. 4. The Town of Longmeadow reserves the right to waive any informalities in the proposal process or in the proposals 7
themselves. 5. The Town of Longmeadow reserves the right to negotiate with the lowest qualified proposer if the Town Manager deems it to be for the best interest of the Town of Longmeadow. 6. The Town of Longmeadow may reject proposals which in its opinion is incomplete or contains conditions not called for, erasures not properly initialed or other irregularities. G. Town Assistance Available to Auditor During the Audit The Town s assistance to the accounting firm will be specifically limited to: 1. Fiscal year ending Balance Sheets and other related documents required by the Department of Revenue for the certification of Free Cash. The Town of Longmeadow is interested in consistently improving its financial reporting. Recommendations and assistance in this endeavor are welcome for discussion. 2. Location of appropriate records (the pulling and filing of specific documents will be the responsibility of the accounting firm which will be required to re-file these documents in an orderly manner). 3. Preparation of Bank and Receivable Reconciliation schedules. 4. Photocopying of documents (limited to one copy of each original document). The accounting firm may make additional copies, reimbursing the Town at a cost of $.20 per copy. 5. Completion of confirmations. 6. Meeting and conferences (by appointment, if necessary). 7. The Town s fiscal year ends on June 30 th. Preliminary financial statements and other records and reports will generally be available for audit by September 15th of each fiscal year. Testing and review of internal controls may take place earlier at a mutually agreed upon time. H. Billings 1. Progress payments may be billed monthly for services rendered in the prior month. The accounting firm will 8
submit an invoice on its letterhead indicating the total number of hours of services and the composite billing rate. The accounting firm will maintain adequate records to substantiate these invoices by the number of hours of service rendered by individual members of the firm and each member s staff level. These records will be made available to the Finance Director of the Town of Longmeadow upon request. The Town of Longmeadow will retain one third of the final contract price until submission of the final audit reports. I. Other Proposal Information 1. If it becomes necessary to revise any part of this R.F.P., or otherwise provide additional information, an addendum will be issued by the Town and furnished to all firms that have received copies of the original R.F.P. 2. All proposals become the property of the Town and are subject to disclosure as required by Massachusetts General Laws. 3. The Town is not liable for any cost incurred by the prospective auditors in replying to this R.F.P. 4. Audit fees of prior years are available upon request. 9
II. INFORMATION TO BE REQUIRED FROM PROPOSER In order to simplify the evaluation process and obtain the maximum degree of comparison, the Town is requiring prospective auditors to submit proposals in the format and manner prescribed in this section. Firms are cautioned that any deviation from this format may result in disqualification of their proposals. A. Title Page 1. Project title. 2. Name of proposing firm. 3. Address and telephone number of proposing firm. 4. Name of contact person. 5. Date of submission. B. Letter of Transmittal (Limit to one or two pages) 1. Briefly state the proposers understanding of the work to be done and make a positive commitment to perform the work within the required amount of time. 2. For Fiscal Years 2012-2014 itemize the fees for each year and state that the proposal is effective for ninety (90) days from the date of the opening of proposals. 3. This letter must be signed by the individual authorized to negotiate for and contractually bind the firm. C. Table of Contents 1. Include a clear identification of the following material by section and by page number. Such sections will be those identified below. D. Professional Experience 10
1. Describe the local and/or regional offices audit experience with local governments (including the Town of Longmeadow) in the last five years. 2. Identify the supervisors (e.g. partner, manager, auditor-in-charge) and the staff who are expected to work on the audit. Provide resumes (which may be included as appendices) showing relevant past experience, education, training, etc. 3. Describe the firms participation, if any, in professionally sponsored quality control review of comparable programs. 4. List the names, contact information and service type provided for all Massachusetts municipalities during FY 2008, 2009 and 2010. 5. Provide two recent sample Management Letters the firm has written for its clients. Please omit the client s name and any other information which may be considered confidential in the submittal. 6. A Certificate of Non-Collusion and a Certificate of Tax Compliance is to be included with the proposal, as well as any other statutorily required documents. E. Proposers Approach to the Audit 1. State the proposers understanding of the services to be performed and the work products to be provided as defined in Section I-C, Nature of Services Required and I-D, Report Requirements of this R.F.P. 2. Submit a work plan to accomplish the scope of services within the required time. The work plan should include time estimates by staff level for each of the significant segments of the work (planning, internal control, testing, and statements / reports) and the staff assigned to each segment. Include a brief discussion of the audit procedures to be used in the audit process for each segment. 11
F. Compensation 1. State total hours and hourly rate required by staff classification for each type of service requested in Section I-C and the resulting all-inclusive maximum fee by year. This fee shall include all costs for which the firm expects to bill the Town, including staff travel, clerical and any other indirect costs. G. Additional Information 1. Give any additional information, not specifically requested previously, considered necessary for fair evaluation of the proposal. RFP Acct Auditing Services FY 12-14 12
PROPOSAL SUBMISSION FORM: CERTIFICATE OF NON-COLLUSION The undersigned certifies under the penalties of perjury that this bid or proposal has been made and submitted in good faith and without collusion or fraud with any other person. As used in this certification, the work person shall mean any natural person, business, partnership, corporation, union, committee, club or other organization, entity, or group of individuals. (Signature of person signing bid or proposal) (Name of Business) CERTIFICATE OF TAX COMPLIANCE Pursuant to Chapter 62C of the Massachusetts General Laws, Section 49A (b), I,, authorize signatory for (Name of Contractor) do hereby certify under the pains and penalties or perjury that said contractor has complied with all laws of the Commonwealth of Massachusetts relating to taxes. Contractor By: (Signature of Authorized Representative) (Title) (Date) 13
Attachment A Evaluation of Proposals Audit Services * NA A E Years of experience in municipalities with similar financial features to those of Longmeadow Firm Audit Team Qualifications Firm Audit Team Approach to the audit Firms understanding of the work to be performed Supervision to be provided over personnel Reasonableness of the time Estimate Pre audit work plan Internal Control Plan Evaluation of References Price Proposal * NA Not Acceptable A Acceptable E - Exceptional 14