Request for Proposals (RFP):

Request for Proposals (RFP): AUDITING SERVICES FISCAL YEARS 2017, 2018, 2019 FINANCIAL STATEMENTS AND U. S. UNIFORM GUIDANCE (FORMERLY, OMB CIRCULAR A-133) AUDIT REPORT Release Date: May 18, 2017 Pre-Proposal Conference Call: June 01, 2017 Responses to Questions Posted: June 07, 2017 Proposal Due Date: June 19, 2017 Anticipated Award Notification Date: July 05, 2017 Anticipated Contract Start Date: October 01, 2017 Behavioral Health System Baltimore, Inc. One Hundred South Charles Street, Tower II, 8 th Floor Baltimore, Maryland 21201 1

TABLE OF CONTENTS I. Overview of the Project 3 A. BHSB s Goals and Objectives 3 B. Organizational Background 3 C. Scope of Services 4 D. Description of Financial Operation 4 E. Relationship with Prior CPA 5 II. Overview of the Request for Proposals 5 A. Purpose of the RFP 5 B. Audit Firm Eligibility 6 C. Proposal Requirements 6 D. Information Required In Response 7 E. RFP Contact and Activities 9 F. RFP Postponement/Cancellation Information 10 G. Applicant Appeal Rights 10 III. Format and Content of Proposal 10 A. Proposal Instructions 11 B. Proposal Narrative Outline/Rating Criteria 12 C. Appendices 12 IV. Attachments (separate documents) A. Attachment I: BHSB Consultant Contract Terms 2

A. BHSB s Goals and Objectives I. OVERVIEW OF THE PROJECT Behavioral Health System Baltimore, Inc. (BHSB) is a non-profit agency established by Baltimore City to serve as the local behavioral health authority. In this role, BHSB oversees and manages the public behavioral health system in Baltimore City. BHSB envisions a city where people live and thrive in communities that promote and support behavioral health and wellness. BHSB is committed to enhancing the behavioral health and wellness of individuals, families, and communities through: The promotion of behavioral health and wellness, prevention, early intervention, treatment, and recovery; The creation and leadership of an integrated network of providers that promotes universal access to comprehensive, data-driven services; and Advocacy and leadership of behavioral health-related efforts to align resources, programs and policy. B. Organizational Background BHSB, a quasi-public nonprofit corporation, was established September 26, 2013. The organization was created by the merger of Baltimore Substance Abuse Systems (BSAS) and Baltimore Mental Health Systems (BMHS) to provide citywide leadership in developing innovative approaches to prevention, early intervention, treatment and recovery Behavioral Health Services to help build healthier individuals, stronger families, and safer communities. BHMS and BSAS to established an Affiliation in order to promote sustainability by strengthening the program opportunities for both organizations, and to combine, the knowledge, skills and experience of two organizations that have established reputations within the community. The intent of this Affiliation was to maintain the purposes, funding, and Section 501(c) (3) federal tax exempt status of each Party while achieving certain efficiencies that will inure to the benefit of the communities they serve. In 1995, the responsibility for the Management of the publicly funded substance abuse treatment and prevention system was transferred from the Baltimore City Health Department to BHSB. The mission of the Organization is to prevent and reduce substance abuse and its adverse health and social consequences in the City of Baltimore. The Organization does this by ensuring that the Baltimore residents have access to high quality and comprehensive services proven to reduce substance abuse. BHSB has approximately 70 full time employees and an estimated budget of $68.5 million, derived from several sources, including the (1) State of Maryland s Alcohol and Drug Abuse Administration (ADAA),and Mental Health Administration (2) Baltimore City Health Department (BCHD), (3) State of Maryland s Aids Administration; (4) Foundations; and (5) designated grants from Baltimore City. 3

C. Scope of Service Through this Request For Proposal (RFP), BHSB is qualified certified public accounting firm to audit its consolidated financial statements for the Fiscal Years ending June 30, 2017, June 30, 2018, and June 30, 2019, to include consolidating statements of financial position and activities, and to provide additional management services as requested by BHSB. These audits are to be performed in accordance with accounting principles generally accepted in the United States, generally accepted auditing standards and Uniform Guidance (formerly, the U.S. Office of Management and Budget's (OMB) Circular A-133). The selected Auditing Company will have demonstrated it s ability to do the following: 1. Express an opinion as to the fair presentation of the BHSB consolidated financial statements in accordance with generally accepted accounting principles; and to issue these statements. a. Communicate in a letter to management 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 that could adversely affect the organization's ability to record, process, summarize and report accurate financial data. 2. Perform an audit as required by OMB Circular A-l33 in accordance with Government Audit Standards to determine whether: BHSB has an internal control structure that provides reasonable assurance that the Corporation is managing federal awards in compliance with applicable laws and regulations; and further that controls are in place that ensure compliance with the laws and regulations where the failure to comply could have a material impact on the financial statements; and BHSB has complied with laws and regulations where the failure to comply may have a direct and material effect on its financial statement and on each major federal program. 4. Issue the consolidated financial statements, schedules and reports on internal controls and compliance with regulations required by OMB Uniform Guidance. 5. Prepare any required notes to the financial statements. 6. Work with other auditors in preparation of consolidated financial statements. 7. Prepare the Corporation s annual tax return (IRS Form 990 and Maryland Property Tax Form) and any filing extensions needed to ensure timely filing with IRS and State of Maryland. D. Description of Financial Operation BHSB has a centralized Office of Finance under the direction of its Vice President and Chief 4

Financial Officer. The office's major responsibilities include tracking grant revenues and expenses through its general ledger system, producing financial statements and accounting reports, filing IRS Form 990 and Maryland Property Tax Forms, budgeting, cash management, corporate investments, disbursement and providing support to outside auditors. The BHSB Finance Office prepares and provides necessary audit schedules to support the financial statements. BHSB uses Great Plains financial accounting package to operate its accounting system. The software is a fund accounting system with a standard general ledger module, project/grant module, a report writer module, and an accounts payable system. The system produces grant budgetary reports, a detailed monthly general ledger by each grant, and a trial balance at each funding level. BHSB regularly compares budgeted to actual results in order to maintain budgetary control. BHSB has a defined retirement plan covering all permanent employees. Form 5500 and other pension-related reports are prepared and filed annually through an independent pension consultant, and are not included in this scope of work. E. Relationship with Prior CPA BHSB relationship with its prior CPAs was courteous and professional. The contract was awarded for several years. All requirements were met during this contract and there are no outstanding obligations on either side. However in order to comply with the roles and responsibilities of the Board of Directors Audit and Financial Committee we are required to solicit audit firms at least once every three years. A. Purpose of RFP II. OVERVIEW OF THE REQUEST FOR PROPOSALS (RFP) Through this Request For Proposal (RFP), BHSB is qualified certified public accounting firm to audit its consolidated financial statements for the Fiscal Years ending June 30, 2017, June 30, 2018, and June 30, 2019, to include consolidating statements of financial position and activities, and to provide additional management services as requested by BHSB. B. Audit Firm Eligibility The audit team must demonstrate its expertise and experience in the following areas: (1) accounting principles generally accepted in the United States, generally accepted auditing standards and government audit standards as they apply to nonprofit institutions; (2) federal regulations governing a private, nonprofit organization receiving federal funds such as OMB Circular A-I22; (3) the conduct of OMB Circular A -133 audits (4) the latest Financial Accounting Standard (F AS) affecting non profit organizations such 5

as No. 117 Financial Statements of Not- for-profit Organizations and No. 116 Accounting for Contributions Received and Contributions Made; and (5) cost allocation plans, indirect rate negotiations and related issues. The firm should also list its capabilities in other relevant management advisory services. C. Proposal Requirements 1. Certified Public Accountant The response must contain an affirmation that the proposer is a certified pubic accountant licensed by a state or other political subdivision of the United States. 2. Independency of Proposer The response must contain an affirmation that the preparer meets the independency standards of the American Institute of Certified Public Accountants' Code of Professional Ethics. 3. Certifications a. The response must contain certification that the firm or any individua1s who will be working on this audit have not been suspended, debarred or accepted voluntary exclusion by the federal or any government agency during the period covered by this response. b. The response must include a completed non-collusion certificate. c. The response must certify that the firm provides a drug-free work place. d. If you have had a peer review within the last three years, the response must contain a statement as to when and who performed the review and submit the results of that review. A copy of the most recent peer review or an explanation from the AICPA, if you are an AICP A member, must also accompany your response. e. Please certify if you are a women/minority-owned business enterprise (W/MBE) and the stake in which you are certified. If you are registered with the Maryland State Department of Transportation Minority Businesses or the Maryland State Minority Affairs Office please provide certification number f. The response must include a certificate of insurance that certifies the firm has liability coverage against personal damage, property damage and workers' compensation claims 6

D. Information Required In Response 1. Cover Page Show the subject of the response, the name of preparer s firm, local address, telephone number, name of firm's persons authorized to make presentations for the proposer, contact person for the response and date submitted. 2. Table of Contents 3. Size of Firm A statement explaining the size of the firm's local office and the experience of the local office audit staff who audit non-profit corporations. 4. Location of Proposer A statement identifying the location from which the work on this engagement is to be performed, and the number and background of the professional staff to be assigned to this engagement. 5. Work to be Done Briefly state the proposer's understanding of the work to be done and make a positive commitment to perform the work within the time period as outlined in this request for proposal. 6. Profile of the Proposer Provide information described under Section Ill-A of this document. 7. Audit and Review of Data Processing Describe the local office s capability to review computerized systems, including the number and classification of personnel skilled in computer sciences who will work on the audit. 8. Special Expertise An explanation of the local office expertise in dealing with cost allocation plans and review for allocability of costs under OMB Circular Uniform Guidance. 9. Identification of Engagement Staff Please state the principal supervisory and management staff, including engagement partner, managers, seniors and any specialists who would be assigned to the engagement, indicating whether each such person is licensed to practice as a 7

certified public accountant. Resumes should be provided for the above personnel, as well as information on (i) their nonprofit audit clients and number of years experience and (ii) continuing professional education credits courses. 10. References The name, address, and telephone number of nonprofit clients served by the members of the team to be assigned to this project must be included with the response. Identify those clients receiving Uniform Guidance audits and those clients receiving CDBG funds. 11. Total Price of Services State the all-inclusive fixed price for all labor, and materials and other expenses needed to complete all items in Section I of the Scope of Services, including a breakdown of the numbers and kinds of professional/non-professional staff that will be utilized in the engagement. State the total hours, the hourly rate required by each staff classification, the descriptions and amounts of other charges, including communications, travel and miscellaneous expenses per year. Please break out the cost for each year of the audit and the price for any additional services outlined in this proposal. 12. Terms of Payment State the payment terms of payment under which you will perform duties under the contract period of the contract price. 13. Sample of Proposed Engagement Letter Please include a sample of your standard engagement letter that you intend to use upon award of this contract. Audit Administration 1. Period of Performance The next fiscal period for BHSB to be audited is for the year ended June 30, 2017. Field work will commence in late November 20174. The audit staff will provide an entrance and exit conference with the Management Staff for the Corporation and an entrance and exit conference with the Finance and Audit Committee for the Corporation's Boards of Directors. The audit staff should be of a sufficient size and experience so the audit can be performed in an efficient manner, and within the time frame needed to meet the completion due dates. The BHSB accounting staff will provide assistance during field work by providing a final trial balance prior to the commencement of the audit and will prepare audit schedules and draft financial statements. The final financial statements and Uniform Guidance reports must be completed and issued by December 31 st of each year of this contract. The audit firm will present the final 8

audit report to the BHSB Audit and Finance Committee at the annual January meeting for final approval. This meeting normally takes place during the second or third week of January. The audit firm will prepare the financial statements, the Uniform Guidance reports and any management letter comments in final form, producing fifteen copies of each. 2. Cost Breakdown Break out the cost for each year of the audit and the price for any additional services outlined in this proposal. 3. Records Retention All work papers and reports must be retained, at the auditor's expense, for a minimum of four years, unless the firm is notified in writing by BHSB of the need to extend the retention period. 4. Reasonable Access In addition, the firm shall respond to the reasonable inquiries during subsequent audits and allow any successor audit firm to review working papers relating to matters of continuing accounting significance. E. RFP Contact & Activities Information 1. Authorized Contact Applicants are advised that the authorized contact person for all matters concerning this RFP is Keisha Tatum, whose contact information is listed below. Keisha Tatum M.S. HSA Director of Contracting Operations Behavioral Health System Baltimore, Inc. One North Charles Street, Suite 1300, Baltimore, MD 21201 Phone: 410-637-1900, x8530 Email: Keisha.Tatum@BHSBaltimore.org 2. Pre-Proposal Conference BHSB will host a pre-proposal conference call to answer questions on June 01, 2017, 10:00 AM. The conference call is not mandatory, however strongly recommended. The call-in number is 410-779-0601, passcode 0601#. Applicants who will not be participating in the pre-proposal conference may email questions to Keisha Tatum (Keisha.Tatum@BHSBaltimore.org) by the close of business on June 02, 2017. Questions posed prior to or during the pre-proposal conference and responses will be 9

included in an addendum to the RFP and posted on the BHS Baltimore website at: www.bhsbaltimore.org by Wednesday June 07, 2017. Questions received after the conference call will not be acknowledged by BHSB. 3. Proposal Due Date, Time, and Location Proposals, along with one additional, unbound copy of the full proposal are due no later than 3:00 pm EST on Monday, June 19, 2017. Proposals submitted after the closing date may not be considered. All proposals must be submitted in hard copy to: Keisha Tatum M.S. HSA Director of Contracting Operations Behavioral Health System Baltimore 100 South Charles Street, Tower II, 8 th Floor Baltimore, MD 21201 BHSB will select the most qualified and responsive applicant through this RFP process. BHSB will enter into a contract with the selected applicant following notification of award. The applicant must comply with all terms and conditions applicable to contracts executed by BHSB. These terms and conditions can be found in Attachment 1 of this RFP. By submitting a proposal to BHSB, applicants attest that they have read and accept these conditions fully. F. RFP Postponement/Cancellation The submission of a proposal does not, in any way, guarantee an award. BHSB is not responsible for any costs incurred related to the preparation of a proposal in response to this RFP. BHSB reserves the right to withdraw an award prior to execution of a contract with a selected applicant at BHSB s sole and absolute discretion. BHSB reserves the right to postpone or cancel this RFP, in whole or in part. G. Applicant Appeal Rights Applicants may file an appeal by emailing the Director of Contracting Operations within five business days of release of the award notification. The email will state the reason(s) for the appeal of the selection decision and provide additional information to be considered by BHSB. The Director of Contracting Operations will review the appeal, examine any additional information provided by the protesting party, and respond to the protestor within ten working days of receipt of the appeal. 10

A. Proposal Instructions III. FORMAT AND CONTENT OF THE PROPOSAL Applicants should submit all required information in the format specified in these instructions by the due date. The proposal narrative should not exceed 10 typed, single-sided, single-spaced pages using Times New Roman 12-point font. Samples of previous in not included in the 10- page limitation. The final proposal package shall include: A proposal cover letter completed, signed, and dated by an authorized representative of the applicant organization. The cover letter must include the full legal name of the applicant organization, address, contact information, and the designated contact person. One original version of the full proposal with all appendices. One additional, unbound copy of the full proposal, including the cover letter and all appendices. The proposal packet must be delivered in a sealed envelope labeled with the applicant s organization name and address; the designated contact person s name, email address and telephone number; and the title of the RFP. Proposals may be mailed or hand-delivered. If the proposal is sent by mail or commercial delivery service, the applicant shall be responsible for actual delivery of the proposal to BHSB on or before the deadline. All submitted proposals become the property of BHSB. Late proposals may not be considered. The proposal should be a clear, concise narrative that describes the applicant s intent to serve the target population. All timely proposals submitted by eligible applicants will be reviewed by BHSB s Review Committee, which will evaluate and rate such proposals based on the criteria below. Failure to submit all required information may result in an applicant s proposal being disqualified. BHSB reserves the right to conduct interviews, request that applicants make presentations, and/or request a site visit. Although discussions may be conducted with applicants after proposals have been submitted, BHSB reserves the right to award contracts based on initial proposals received, without discussions; therefore, the applicant s initial proposal should represent its best effort. B. Proposal Narrative Outline and Rating Criteria (100 Points) Each proposal submitted will be examined and rated using the rating criteria below. 11

a. Clearly demonstrating an understanding of the work to be performed. (30 points) (i) Coverage including appropriateness and adequacy of proposed procedures, necessity for procedures, and appropriateness of assigned staff levels. (ii) Hours proposed are realistic for each major segment of the work plan. Hours are properly apportioned for each staff level. b. Technical Experience of Proposer (30 points) (i) Experience and capability in performing work of a similar nature. (ii) Experience in performing Single Audits for state and local governments, nonprofits, etc., and an understanding of applicable laws and regulations. (iii) Experience in performing federal CDBG and other federal award-related audits. (iv) Size and Structure of Proposer c. Qualifications of management and staff to be assigned to the project. (20 points) (i) Qualifications of the engagement team Education, including continuing professional education credit courses. Position in the' firm, years and types of audit experience will be considered. (ii) Supervision to be exercised over the engagement team by the firm's management. (iii) An understanding of the specific members assigned to this project as to the requirements as may be revealed through an interview process. (iv) Ability of team members to successfully complete similar projects by references from prior clients. (v) Commitment of firm to keep audit staff on audit engagement consistent as much as possible. d. Price Criteria (all inclusive fixed price) (20 points) 12