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• FALCON HEIGHTS CITY COUNCIL MINUTES -8-
<br />January 28, 2004
<br />Consideration of RFP's for Audit Services
<br />Finance Director Olson said that a Request For Proposal "RFP" for auditing services for the City
<br />was sent to six different auditing firms with experience in governmental auditing. Three
<br />proposals were received. The three firms responding with RFP's were: Kern, DeWenter,
<br />Viere, Ltd; HLB Tautges, Redpath. Ltd; and Larson, Allen, Weishair & Co. LLP.
<br />There is a new auditing requirement for all audits of accounting periods beginning on or after
<br />December 15, 2002. "Statement on Auditing Standards (SAS) 99, Consideration of Fraud in a
<br />Financial Statement Audit". One of the remedies to fraudulent misstatement in financial
<br />statements by corporations was the development of SAS 99 which requires auditors to perform
<br />more work in every audit in both identifying and responding to the risk of material misstatement
<br />due to fraud. This additional audit work will add approximately 10% to the audit fees of all city
<br />audits. The audit cost for 2002 was $13,000.
<br />Each proposal was reviewed by looking at service level, cost to provide the level of service,
<br />GASB34 experience, and the firm's commitment to continuing education about GASB34.
<br />City references were checked for all three firms that submitted RFP's.
<br />• Three Year Maximum Price Proposals listed by firm:
<br />2003 2004 2005 TOTAL
<br />Kern, DeWenter, Viere Ltd $14,500 $15,000 $15,500 $45,000
<br />HLB Tautges, Redpath, Ltd $16,990 $17,530 $18,070 $52,590
<br />Larson, Allen, Weishair & Co $21,920 $21,920 $21,900 $65,740
<br />Finance Director Olson said that staff was recommending the selection of Kern, DeWenter,
<br />Viere Ltd, as the auditing firm for the City's annual audit for the years ending 2003, 2004, and
<br />2005. They provide exemplary service, are a leader in GASB34 implementation for cities in
<br />Minnesota, have shown a commitment to continuing education about GASB34 implementation
<br />to all the cities, whether or not they are a client, and finally, their cost proposal better meets the
<br />efforts of the City to balance the service requirements with competitive pricing.
<br />Mayor Gehrz said that personally, and as Mayor, she appreciates the work and style of work the
<br />current auditors have done. She believes it is good business sense to make sure prices are fair
<br />and services are appropriate for the cost. She has enjoyed working with them in the past and
<br />looks forward to working with them in the future.
<br />Kuettel moved approval of the contract with the auditing firm of Kern, DeWenter, Viere, Ltd,
<br />• as the City Auditor for the years 2003, 2004, and 2005. The motion was unanimously approved.
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