REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS
OF SAN BERNARDINO COUNTY
AND RECORD OF ACTION
REPORT/RECOMMENDATION TO THE BOARD OF DIRECTORS
OF The Following:
INLAND EMPIRE PUBLIC FACILITIES CORPORATION
SAN BERNARDINO COUNTY FINANCING AUTHORITY
AND RECORD OF ACTION
July 26, 2022
FROM
ENSEN MASON, Auditor-Controller/Treasurer/Tax Collector
SUBJECT
Title
Agreement with CliftonLarsonAllen LLP and Transfers of Funds for Audit Services
End
RECOMMENDATION(S)
Recommendation
1. Acting as the governing body of San Bernardino County, approve Agreement with CliftonLarsonAllen LLP for the one-year period of July 26, 2022, through June 30, 2023, to provide financial/single audits for San Bernardino County, and financial audits of Arrowhead Regional Medical Center, the Inland Empire Public Facilities Corporation, and the San Bernardino County Financing Authority for the fiscal year ending June 30, 2022, in an amount not to exceed $261,325.
2. Acting as the governing body of the Inland Empire Public Facilities Corporation, authorize the Auditor-Controller/Treasurer/Tax Collector to transfer funds for the financial audits of the Inland Empire Public Facilities Corporation for the fiscal year ending June 30, 2022, in an amount not to exceed $16,090 (Four votes required).
3. Acting as the governing body of the San Bernardino County Financing Authority, authorize the Auditor-Controller/Treasurer/Tax Collector to transfer funds for the financial audits of the San Bernardino County Financing Authority for the fiscal year ending June 30, 2022, in an amount not to exceed $14,950 (Four votes required).
(Presenter: Tori Roberts, Assistant Auditor-Controller/Treasurer/Tax Collector, 382-7005)
Body
COUNTY AND CHIEF EXECUTIVE OFFICER GOALS & OBJECTIVES
Operate in a Fiscally-Responsible and Business-Like Manner.
FINANCIAL IMPACT
Approval of this item will not result in the use of additional Discretionary General Funding (Net County Cost). The cost for reimbursement for audit services is included in the Auditor-Controller/Treasurer/Tax Collector (ATC), Inland Empire Public Facilities Corporation (IEPFC), Arrowhead Regional Medical Center (ARMC), and San Bernardino County Financing Authority (SBCFA) 2022-23 budgets. The table below shows the maximum payment by agency for the term of the contract:
|
Agency |
Amount |
|
Auditor-Controller/Treasurer/Tax Collector |
$ 153,868 |
|
Annual Comprehensive Financial Report ($103,708) |
|
|
Single Audit ($49,140) |
|
|
Gann Appropriations Limit ($1,020) |
|
|
Arrowhead Regional Medical Center |
76,417 |
|
Inland Empire Public Facilities Corporation |
16,090 |
|
San Bernardino County Financing Authority |
14,950 |
|
Total |
$ 261,325 |
BACKGROUND INFORMATION
A financial audit of San Bernardino County is required by Article V, Section 6, of the County Charter and Government Code Section 25250. An audit of IEPFC is required by Article V, Section 4 of the Bylaws of the Corporation. An audit of SBCFA is required by Government Code Section 6505. A single audit of San Bernardino County is required by the Single Audit Act of 1984, as amended in 1996, and Title 2 of the United States Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance).
The recommended agreement with CliftonLarsonAllen LLP (CLA) for financial and federal compliance auditing services will allow the County, IEPFC, and SBCFA to satisfy these requirements. In addition, ATC is requesting Board of Supervisors’ (Board) approval to transfer funds from IEPFC and SBCFA for the payment of the audit services.
As one of the nation’s leading professional services firms, and one of the largest firms who specialize in regulated industries, CLA has the experience and resources to fulfill the County’s audit needs. CLA performs single audits for hundreds of organizations annually, ranking top in the nation for the number of single audits performed by any Certified Public Accountant (CPA) firm. The single audit requires a specific set of skills to properly perform the procedures and CLA has developed a group of professionals who specialize in providing single audit services.
Additionally, CLA has developed one of the nation’s leading health care practices. Their team includes licensed CPAs and a diverse range of experienced professionals with backgrounds and skillsets ranging from Chief Executive Officers and Chief Financial Officers, to registered nurses, certified coders, and certified medical practice executives. Represented by team members possessing up to 30 years of dedicated experience to the healthcare field, CLA develops innovative responses and creative strategies for clients who demand specialized expertise in the healthcare industry, making them qualified to perform the financial audit for ARMC.
PROCUREMENT
On February 25, 2022, ATC released Request for Proposals (RFP) No. ACT122-ACTT-4489 for independent auditing services for the County’s Annual Comprehensive Financial Report (ACFR), the County’s Single Audit Report (Single Audit), IEPFC, SBCFA, and ARMC to secure services for a five-year period. The RFP was posted on the San Bernardino County Electronic Procurement Network (ePro). At the close of the RFP submission period, only two proposals were received as follows:
|
Firm |
Location |
5-Year Cost |
|
CliftonLarsonAllen LLP |
Roseville, CA |
$ 1,253,970 |
|
Eide Bailly |
Rancho Cucamonga, CA |
$ 1,524,913 |
Due to the limited number of proposals received and to garner a broader pool of possible auditing firms in order to maximize the benefit to the County, RFP No. ACT122-ACTT-4489 has been cancelled and a new RFP will be issued. However, a new RFP cannot be executed with sufficient time to ensure that all mandatory financial reporting is complete and conveyed to the required users before all regulatory and statutory deadlines.
To avoid a lapse in auditing services while a new RFP is issued, ATC reached out to the two vendors, CLA and Eide Bailly, to consider providing interim services of specific deliverables for a one-year period. CLA agreed to provide one-year services for the ACFR, Single Audit, and GANN Appropriations Limit. Eide Bailly respectfully declined to provide one-year audit services for ARMC, SBCFA, and IEPFC. Subsequently, ATC reached out to CLA once again to determine if they would also be able to provide one-year auditing services for ARMC, SBCFA, and IEPFC. As a result, CLA submitted a proposal for all auditing services for one year.
ATC is recommending CLA be awarded a one-year contract to perform these independent auditing services. Contracting with CLA will ensure that all filing deadlines are met. The Purchasing Agent supports the use of a non-competitive procurement for these services until a contract can be awarded through a competitive process.
REVIEW BY OTHERS
This item has been reviewed by County Counsel (Kristina Robb, Principal Assistant County Counsel, 387-5455) on July 20, 2022; Risk Management (Victor Tordesillas, Director, 386-8621) on July 20, 2022; Purchasing (Bruce Cole, Supervising Buyer, 387-2148) on July 20, 2022; Finance (Carl Lofton, Administrative Analyst, 387-5404) on July 21, 2022; and County Finance and Administration (Paloma Hernandez-Barker, Deputy Executive Officer, 387-5423) on July 20, 2022.