Fiscal Note
The $208,500 cost of the 2007 audit work during 2008 represents a 13.5% increase over the amount originally contracted and an 18% increase over the prior year's actual cost. Of the total audit cost, approximately $100,000 is charged to general fund agencies, with the remaining costs allocated to the various enterprise agencies and component units operated by the City and included in the audit engagement. Sufficient funds are available within the various budgets of the responsible agencies to fund the increased costs associated with this contract amendment.
Title
Authorizing an amendment to the contract with the City’s independent auditors, Virchow Krause & Company, to provide for a fee increase resulting from an expansion of the audit scope for fiscal years 2007 and 2008.
Body
PREAMBLE
In 2004, following a competitive procurement process, the City contracted with Virchow Krause & Company to provide independent financial audit services. The contract covered a three-year term (fiscal years 2004, 2005 and 2006) with an option for two additional one-year extensions (fiscal years 2007 and 2008). Virchow Krause has successfully completed all work for the initial three years and received authorization last year to commence work on the 2007 audit. It is staff’s intention to also authorize commencement of the 2008 audit work later this year, thus completing the original contract term. During the latter part of this year, Comptroller’s staff will again seek competitive proposals for a future multi-year audit engagement to begin with the audit of 2009 activities.
Since the current contract was signed in 2004, a number of new audit requirements have caused a significant expansion in the amount of work needed to complete the annual audit. In response to the collapse of Enron and other highly publicized cases of corporate fraud earlier this decade, the Governmental Accounting Standards Board (GASB) has issued a series of new standards and pronouncements req...
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