25B - AGMT WITH WHITE NELSON FOR AUDITING SERVICES

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Approve Agreement with White Nelson Diehl Evans LLP for Professional Auditing Services March 3, 2020 Page 2 Below is a list of the audits/examinations conducted by WNDE since 2016: Audit / Examination Type Description Comprehensive Annual Financial Re port Review of City's Annual Financial Statements Single Audit Review of City's Federal Grant Programs Gann Limit Determine City's compliance with State law Investment Policy Agreed Upon Procedures Determine City's compliance with its investment Policy Air Quality Management District Audit Determine City's compliance with State law Measure X (Agreed Upon Procedures) Review of City's Measure X revenue/expenditure spending The Governmental Standards Board (GASB) has issued two (2) new rules related to accounting for the City's leases and fiduciary activities that will impact the City's financial statements. Due to the complexity of these new rules and the significant impact they have on the City's CAFR, staff needs to work closely with the City's external auditors throughout the next two fiscal years to ensure the City meets the new financial reporting requirements. WNDE's high level of technical knowledge in the field of government accounting and auditing along with their experience with the City's fund structure and operations will allow the City to implement the new standards in the most efficient manner. The recommended extension will result in a total of six service years from WNDE. The Government Finance Officers Association issued a Best Practice for audit procurement, recommending governmental entities should enter into multiyear agreements of at least five years to allow for continuity and to minimize disruption. There is a belief that auditor independence is enhanced by auditor rotation at the end of each multiyear agreement. Therefore, staff will schedule issuance of a Request for Proposals for independent audit services during Fiscal Year 2020-21. WNDE has agreed to reduce its total not to exceed contract amount by approximately $11,000 per year during the new contract term. STRATEGIC PLAN ALIGNMENT Approval of this item allows the City to meet Goal #7 - Team Santa Ana, Objective #5 (create a culture of innovation and efficiency within the organization), Strategy F (Explore opportunities to engage with outside agencies, both private and public, to share information and increase efficiencies). FISCAL IMPACT Funds for these services will be included in the following fiscal years' budget within the accounts noted below along with their respective audit related costs. The allocations are subject to non - substantive changes based on the actual work performed. 25B-2