REPORT TO THE CITY COUNCIL
FROM: SANTINO DANISI, MBA, City Controller/Finance Director
Finance Department
BY: KALEB NEUFELD, MBA, Assistant Controller/Assistant Director
Finance Department
SUBJECT
Title
Approve the First Amendment to the Service Agreement with The Pun Group, LLP, for independent outside auditing services related to Fiscal Year 2024-25, to increase the total contract by $40,000, for a revised total fee amount not to exceed $772,135.
Body
RECOMMENDATION
Staff recommends that the City Council approve the contract amendment for work to be conducted in Fiscal Year 2025-26, pertaining to Fiscal Year 2024-25 (Year Four) of the existing contract, for an additional amount not to exceed $40,000, for a revised total fee amount not to exceed $772,135.
EXECUTIVE SUMMARY
Section 1216 of the City of Fresno's Charter requires the City to employ a public accountant to perform an independent audit of the City's books, public records, inventories, and reports. The Finance Department would like to expand the scope of services that the City’s current independent outside auditor, The Pun Group, provides to the City for an additional cost of $40,000. As a result of this added service, the City will incur a cost savings of approximately $43,368 for work pertaining to the Fiscal Year 2024-25 year-end audit and Annual Comprehensive Financial Report (ACFR).
BACKGROUND
The Pun Group has been the City’s independent outside auditor since 2022 and is currently in the final year (Year Four) of the agreement. Based on the current contract scope, The Pun Group is responsible for performing an independent audit of the City’s books, public records, inventories, and reports. The Pun Group performs the auditing services for the Annual Comprehensive Financial Report (ACFR), Single Audit, National Transit Database (NTD - Transit), Employees Health & Welfare Trust, Gann Limit Appropriations Letter, and the Passenger Facility Charges (PFC - Airports) report.
The Finance Department currently utilizes a separate software vendor to assist with compiling the ACFR report. The cost to renew this service for the Fiscal Year 2024-25 ACFR is anticipated to be $83,368. The Pun Group has provided a $40,000 proposal to extend their engagement to include expanded professional auditing services-financial statement drafting and preparation support-for the Fiscal Year 2024-25 ACFR. As a result, the Finance Department would not need to utilize the existing software vendor in Fiscal Year 2024-25 to assist with the ACFR completion. The Pun Group will provide comprehensive support in drafting the ACFR, including preparing the financial statements, ensuring accurate financial disclosures, clarity in statistical sections, and full compliance with Government Finance Officers Association (GFOA) and Government Accounting Standards Board (GASB) requirements.
ENVIRONMENTAL FINDINGS
By the definition provided in the California Environmental Quality Act Guidelines Section 15378 this item does not qualify as a “project” and is therefore exempt from the California Environmental Quality Act requirements.
LOCAL PREFERENCE
Local preference was not considered because this is an amendment to an existing service agreement.
FISCAL IMPACT
The proposed amendment to the contract with The Pun Group for expanded professional auditing services will result in an additional cost of $40,000 for Fiscal Year 2024-25. This cost will be offset by the elimination of the need to renew the existing software vendor's service, which is anticipated to cost $83,368 for the Fiscal Year 2024-25 ACFR. As a result, the City will achieve a net cost savings of approximately $43,368 for the Fiscal Year 2024-25 year-end audit and Annual Comprehensive Financial Report (ACFR).
Attachment:
1st Amendment Contract