Financial Statements Preparation and Auditing Services

Request for Proposal (RFP) RFP # 181-2022-100 Financial Statements Preparation & Auditing Services Issue Date: February 10, 2022 Bid Opening: Thursday, March 10, 2022 @ 3:00 PM Direct all inquiries concerning this RFP to: Rachael Haines, Chief Finance Officer Email: rhaines@ecpps.k12.nc.us Page 2 of 13 EXECUTION In compliance with this Request for Proposals (RFP), and subject to all the conditions herein, the undersigned Vendor offers and agrees to furnish and deliver services as provided within the RFP. Failure to execute/sign proposal prior to submittal may render proposal invalid and it MAY BE REJECTED. Late proposals cannot be accepted. COMPLETE/FORMAL NAME OF VENDOR: STREET ADDRESS: P.O. BOX: ZIP: CITY & STATE & ZIP: TELEPHONE NUMBER: TOLL FREE TEL. NO: PRINCIPAL PLACE OF BUSINESS ADDRESS IF DIFFERENT FROM ABOVE PRINT NAME & TITLE OF PERSON SIGNING ON BEHALF OF VENDOR: FAX NUMBER: VENDOR’S AUTHORIZED

SIGNATURE: DATE: EMAIL: Offer valid for at least 60 days from date of proposal opening, unless otherwise stated here: ______ days. Refer ALL Inquiries regarding this RFP to: Rachael Haines rhaines@ecpps.k12.nc.us Request for Proposal # 181-2022100 Proposals will be opened: March 10, 2022 @ 3:00PM Contract Type: Open Market Using Department: Finance Department Commodity No. and Description: Auditing Services Requisition No.: (Internal) ELIZABETH CITY-PASQUOTANK COUNTY BOARD OF EDUCATION Page 3 of 13 Contents Request for Proposal ........................................................................................................................... 4 Type of Audit ....................................................................................................................................... 4 Auditor Requirements .......................................................................................................................... 5 Audit Contract: Period & Payment of Audit Fees .................................................................................. 6 Description of Selection Process .......................................................................................................... 7 Section 1 - Profile of the Firm .............................................................................................................. 7 Section 2 – Audit Approach ................................................................................................................. 9 Time Schedule for Awarding the Contract ........................................................................................... 10 Description of the Governmental Entity and Its Accounting System ..................................................... 11 Funds ................................................................................................................................................ 11 Budgets ............................................................................................................................................. 11 Accounting Records ........................................................................................................................... 11 Assistance Available to Auditor .......................................................................................................... 12 SUMMARY OF AUDIT COSTS SHEET ............................................................................................. 13 Page 4 of 13 Request for Proposal The Elizabeth City-Pasquotank County Board of Education (hereinafter called the “unit”) invites qualified independent auditors (hereinafter called “auditor”) having sufficient governmental accounting and auditing experience in performing an audit in accordance with the specifications outlined in this Request for Proposal (RFP) to submit a proposal. There is no expressed or implied obligation for the unit to reimburse firms for any expenses incurred in preparing proposals in response to this request. The specific details shown herein shall be considered minimum unless otherwise shown. The specifications, terms, and conditions included with this RFP shall govern in any resulting contract(s) unless approved otherwise in writing by the unit. The bidder consents to personal jurisdiction and venue in a state court of competent jurisdiction in Pasquotank County, North Carolina. Type of Audit 1. The audit will encompass a financial and compliance examination of the unit’s financial statements, supplementary information and compliance reports in accordance with the laws and/or regulations of the State of North Carolina, which include requirements for the minimum scope of the audit. The financial and compliance audit will cover federal, state, and local funding sources in accordance with generally accepted auditing standards; Government Auditing Standards, July 2018 revisions; the provisions of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), the State Single Audit Implementation Act; and all other applicable laws and regulations. 2. The scope of the audit and all fee quotes presented should include all approved and known pronouncements through the date of proposal submission. This includes, but is not limited to, the Governmental Accounting Standards Board (GASB) statements and Government Auditing Standards. Although some pronouncements will not be in effect until after the first year of the audit, estimates for future years should include pronouncements that will become effective during that contract period. The audit firm will be expected to advise appropriate staff on the applicability of accounting and reporting standards as they become effective. 3. The financial audit opinion will cover the financial statements for the governmental activities, the business-type activities, each major fund and the remaining fund information, which collectively constitutes the basic financial statements. The combining and individual financial statements, schedules, and related information are not necessary for fair presentation, but will be presented as additional analytical data. This supplemental information, as required by GASB 34, will be subjected to the tests and other auditing procedures applied in the audit of the basic financial statements, and an opinion will be given as to whether the supplemental information is fairly stated in all material respects in relation to the basic financial statements taken as a whole. The auditor shall express an opinion on the budgetary comparison information for the General Fund, the major funds and any annually budgeted special revenue funds. An opinion will not be given on the Management Discussion and Analysis. The working papers shall be retained and made available upon request for no less than three years from the date of the Audit report. 4. The audit will also include the following: a. Pre-planning conference with the Superintendent and Finance staff in May where both Page 5 of 13 the auditor and Finance staff discuss their expectations of the audit. b. Interim audit work in May or before mid-June. c. Attendance at the Board of Education meeting in late November or December for presentation of the financial statements by Manager or Partner of the Audit Staff with comments and potential questions from the Board as requested. 5. The audit should encompass all funds and entity-wide activities as reported in the unit’s Audit Report at June 30, 2021 and any additional funds or entity-wide activities that may be added subsequent to that date. 6. If required, the audit firm will issue a management letter to the Board of Education after completion of the audit and assist management in implementing recommendations, as is practical. Unit staff also request that an informal letter be addressed to the Finance Officer with any efficiency, internal control or accounting improvements that could be made based on the audit staff’s observation during their fieldwork. All content must be discussed with the Finance Officer prior to issuance. The audit firm is encouraged to discuss the content while the management letter is in draft form to ensure that all parties fully understand the circumstances that lead to auditor comments. 7. The Unit staff may require the auditor’s guidance or input on the completion of certain schedules/documents as to proper format and content, so that they can be used in the audit process as well as inclusion in the Unit’s financial statements. Guidance may be required for new note disclosures, all outstanding and effective authoritative standards and other reporting requirements at June 30 year-end. Cost for providing these services should be included in the auditor’s base fee quote and will not be considered extra for additional billings. In cases, however, where services requested would require a more in-depth scope and require work significantly above the original fee quote, such additional fees must be negotiated prior to commencement of work. Auditor Requirements The audit firm is considered to be an independent contractor and will be wholly responsible for the services and the supervision of its own employees and permitted sub-contractors. A planning meeting will be held each year to determine schedules that the Unit will be responsible for preparing. Estimated timeframes will be established and interim audit work will be planned. Adequate notification will be given prior to any changes in estimated times. If the Elizabeth City-Pasquotank County Board of Education audit engagement is subject to the standards for audit as defined in Government Auditing Standards, 2018 revisions, issued by the Comptroller General of the United States, then by accepting this engagement, the Auditor warrants that he has met the requirements for a peer review and continuing education as specified in Government Auditing Standards. The Auditor must provide a copy of their most recent peer review report with their proposal. The Unit staff will prepare all standard year-end accruals and other adjusting journal entries. The Auditor will prepare the government wide year-end adjusting journal entries as well as any necessary entries to allocate the state pension balances. The auditor will be responsible for the preparation, typing, proofing, printing, and copying of the Basic Financial Statements, supplementary information and compliance reports. The Unit’s Finance Officer will prepare the MD&A. A preliminary draft of the audit and required adjusting journal entries must be submitted to the Finance Officer at least two weeks prior to the submission deadline for proofing and reconciliation to the Unit’s records to allow ample time for review and corrections before it is sent to the Local Government Commission. The Elizabeth City-Pasquotank County Board of Education’s Finance Officer will return the draft to the Auditor with proposed revisions within 10 working days. The Auditor will be ultimately responsible for the Page 6 of 13 preparation, typing, proofing, printing, and copying of the Basic Financial Statement, supplementary information and all applicable compliance reports. Meeting LGC deadlines is a high priority for the Unit. Therefore, the Elizabeth City-Pasquotank County Board of Education prefers interim fieldwork be completed in late May or early June. Year- end fieldwork should begin by the end of August and be completed by late September. While many documents can be shared electronically, the Unit expects that the audit firm staff will be onsite for fieldwork, including manager and partner level staff for at least a portion of the onsite work. An agreed upon post-closing trial balance should exist by September 30. The Finance Officer will expect a listing of requested information needed for the audit at the preplanning conference, periodic conferences during the conduct of the audit, as well as an exit conference prior to the completion of fieldwork. The timing of the draft and review should insure final completion of the Financial Statements by the annual October 31st deadline or no later than the annual grace period of December 1. One electronic and twenty (20) hard copies of each Audit report, management letter, and other applicable reports must be supplied to the Finance Officer within the time frame cited above. In addition, the auditor is responsible for complying with the requirements of the LGC for submitting the audit and all associated documents and forms as required for the year under audit when (or prior to) submitting the final invoice for audit services rendered to the Commission. In the event that circumstances arise during the audit that require work to be performed in excess of the original estimates, any additional costs will be negotiated prior to commencement of the work and an amended contract will be approved by the governing board and forwarded to the staff of the LGC for approval. Either the manager or partner of the audit staff is required to present and attend the Board of Education’s meeting in which the Audit report is presented. Required communications to the Board of Education can be delivered at this point, as well as general comments regarding the audit process and the results of the audit. Finance staff will coordinate this presentation and determine the date and time of the meeting, typically held in late November or December following the audit completion. Audit Contract: Period & Payment of Audit Fees The Unit intends to continue the relationship with the auditor for no less than three years on the basis of annual negotiation after the completion of the first year contract. Each year after negotiation has taken place an annual contract documenting the terms of the audit will be signed. Since one governing board may not obligate future governing boards, the remaining years of the agreement are subject to annual governing board approval. The Unit reserves the right to request proposals at any time following the first year of this contract. It is requested that proposals be prepared for the following years, with year one being the only obligated year: July 1, 2021 to June 30, 2022 July 1, 2022 to June 30, 2023 July 1, 2023 to June 30, 2024 The audit contract must be approved by the staff of the Local Government Commission and the appropriate Grantor Agency, if applicable, prior to processing by the school unit. If grant funds Page 7 of 13 will be used to pay for the audit, the grant agreement may require the Grantor Agency’s approval before the invoices may be paid. Invoices are subject to approval by the LGC prior to payment by the Unit. Interim or progress billings for services rendered marked approved by the LGC will be paid up to 75% of the total fee prior to submission of the final audited financial statements to the staff of the Local Government Commission. The final 25% of the Audit fees (final invoice) will be paid when the financial statements, single audit (if applicable), management letter and amended contract (if applicable) have been reviewed or approved by the LGC. Description of Selection Process Submission of Questions Concerning RFP After the proposal issue date, all communications between the Unit and prospective Auditors regarding this RFP shall be in writing. Any inquires, requests for interpretation, technical questions, clarification, or additional information shall be directed to Rachael Haines by emailing rhaines@ecpps.k12.nc.us. Please include in the email subject line: RFP # 181-2022100 – Questions. Questions and responses affecting the scope of the services will be provided to Auditors by issuance of an Addendum which will be posted to North Carolina’s Interactive Purchasing System website at www.ips.state.nc.us. All questions shall be received no later than 5:00 P.M., Friday, February 18, 2022. The addendum should be posted by February 23, 2022. Bidders may not have communications, verbal or otherwise, concerning this RFP with any Unit personnel or officials, other than the persons listed in this section. Potential respondents should email rhaines@ecpps.k12.nc.us to acknowledge receipt of the RFP and to inform the Unit of its intent to respond. Provide the name, title, address, telephone and email address of the individual who can address inquiries related to this RFP and the respondent’s proposal. Proposals must be submitted in two sections and must be physically signed by an authorized representative of the Audit firm. The first section will be comprised of the audit firm’s prior experience and qualifications of its personnel in performing governmental audits. The second section will consist of completed cost estimate sheets. The review committee will evaluate the auditor/firm on educational and technical qualifications. The top five firms best meeting the Unit’s expectations for experience and audit approach will have their second section “Cost” opened and evaluated. Please keep in mind that cost, while an important factor will not be a sole determining factor. Unusually low bids that are obviously out of line with other bidders or are significantly lower than out current fees will raise concern. The lowest bid will not automatically be awarded preferential consideration. The Unit reserves the right to reject any or all bids, waive technicalities, and to be the sole judge of suitability of the services for its intended use and further specifically reserve the right to make the award in the best interest of the Unit. Failure to respond to any requirements outlined in the RFP, or failure to enclose copies of the required documents, may disqualify the bid. Firms must be registered with the North Carolina State Board of CPA Examiners. Section 1 - Profile of the Firm mailto:rhaines@ecpps.k12.nc.us Page 8 of 13 The first section should address the requested information below. The corresponding responses should begin with the number below for the requested information. 1. Indicate the Audit firm’s North Carolina office location(s) that will handle the audit. 2. Indicate the number of people (by level) located within the Audit firms local office that will handle the audit. 3. Provide a list of the audit firms’ local office’s current and prior government audit clients, highlighting local boards of education, indicating the type(s) of services performed and the number of years served for each. 4. Indicate the experience of the local office in providing additional services to government clients by listing the name of each government, the type(s) of service performed, and the year(s) of engagement. 5. Describe your audit organization’s participation in AICPA sponsored or comparable quality control programs (peer review). Provide a copy of the firm’s current peer review. 6. Describe the professional experience in governmental audits of each senior and higher level person assigned to the audit, the years on each job, and his/her position while on each audit. Indicate the percentages of time each senior and higher-level personnel will be on site. 7. Describe the relevant experience and education of each person assigned to the audit, senior level and higher. Include seminars and courses attended within the past three years. Courses in governmental accounting and auditing should be clearly communicated. 8. Describe the professional experience of assigned individuals in auditing relevant government organizations, programs, activities, or functions (e.g., Water/Sewer service functions, transit, airports, or health authorities and school systems). 9. Describe any specialized skills, training, or background in public finance of assigned individuals. This may include participation in State or national professional organizations, speaker or instructor roles in conferences or seminars, or authorship of articles and books. 10. Provide names, addresses, and telephone numbers of personnel of three (3) current and prior governmental audit clients, with at least one being a local board of education, who may be contacted for a reference. 11. Describe the firm’s Statement of Policy and Procedures regarding Independence under Government Auditing Standards (Yellow Book), July 2018 Revision. Provide a copy of the firm’s Statement of Policy and Procedures. 12. Is the firm adequately insured to cover claims? Describe liability insurance coverage arrangements. 13. Describe any regulatory action taken by any oversight body against the proposing audit organization or local office. 14. Comment on your knowledge of and relationship with the NC Local Government Commission Page 9 of 13 and the University of North Carolina School of Government in Chapel Hill. Section 2 – Audit Approach Proposals should include completed cost estimate sheets and any other necessary cost information in a separate, sealed envelope marked – “Cost Estimate.” The Unit will evaluate the qualifications of all firms submitting proposals before considering the Cost Estimate. Section 2 should include completed cost estimate sheets and the following information: 1. Type of audit program used (tailor-made, standard government, or standard commercial). 2. Use of statistical sampling. 3. Use of automated processes and internal control testing methods. 4. Use of computer audit specialists. 5. Organization of the audit team and the approximate percentage of time spent on the audit by each member. 6. Information that will be contained in the management letter. 7. Assistance expected from the unit’s staff, if other than outlined in the RFP. 8. Tentative schedule for completing the audit within the specified deadlines of the RFP. 9. Specify costs using the format below for the audit year July 1, 2021 to June 30, 2022. For the two audit years, which follow, list the estimated costs. The cost for the audit year ending June 30, 2022 is binding, while the second and third years are estimated costs. Cost estimates must indicate the basis for the charges and whether the amount is a “not-to- exceed” amount. A. Audit firm personnel costs – Itemize the following for each category of personnel (partner, manager, senior, staff accountants, clerical, etc.) with the different rates per hour. 1) Estimated hours: please categorize estimated hours into the following: on-site interim work, year-end on-site work, and work performed in the auditor’s office. 2) Rate per hour. 3) Total cost for each category of personnel and for all personnel costs in total. B. Travel – itemize transportation and other travel costs separately. C. Cost of supplies and materials – itemize. D. Other costs – completely identify and itemize. 1) If applicable, note your method of determining increases in audit costs on a year to year basis. Page 10 of 13 10. Please list any other information the firm may wish to provide. 11. Please include the Summary of Audit Costs Sheet with your proposal. Time Schedule for Awarding the Contract RFP Release Date February 10, 2022 Deadline for RFP Questions * February 18, 2022 by 5:00 pm Questions to be Answered No Later Than February 23, 2022 Deadline for Receipt of Proposals ** March 10, 2022 at 3:00 pm Elizabeth City-Pasquotank County Board of Education, Finance Department Attn: Rachael Haines, Finance Officer 1200 Ha l s t ead B l v d PO B o x 2247 Elizabeth City, NC 27909 Notice of Recommended Firm March 21, 2022 Board Approval March 28, 2022 *Any questions should be directed to Rachael Haines, Chief Finance Officer, at rhaines@ecpps.k12.nc.us. Please include in the subject line: RFP # 181-2022100 Questions. ** Proposals should be mailed to Rachael Haines by March 10, 2022 by 3:00 PM. Envelopes containing proposals should be clearly identified on the front with the words “RESPONSE TO RFP # 181-2022100 AUDIT SERVICES”. ➢ Envelopes should include One (1) original and Three (3) copies of the bound proposal (clearly separating section 1 and 2 with Section 2 containing a separate sealed envelope for cost) should be delivered to: BY MAIL: PO BOX 2247, ELIZABETH CITY, NC 27909 BY COURRIER: 1200 HALSTEAD BLVD, ELIZABETH CITY, NC 27909 The Board of Education reserves the right to request additional information deemed necessary to aide in the selection process. The evaluation and selection criteria and process contained in this RFP will be used by the Review Committee. mailto:rhaines@ecpps.k12.nc.us Page 11 of 13 Description of the Governmental Entity and Its Accounting System Elizabeth City-Pasquotank Board of Education is a public school system in North Carolina with approximately 4,800 students and 850 employees. The school system is comprised of thirteen (13) schools: seven elementary schools (Grades K-5), two middle schools (Grades 6-8), two traditional high schools (Grades 9-12), one alternative school serving middle and high school students, and an early college located on the campus of College of the Albemarle. In addition, ECPPS has a Pre-K program located at one of the elementary schools. The entity operates two enterprise funds, School Food Service Fund and After School Enrichment Program Fund. Prospective bidders can request a PDF copy of the most recent Audit report by emailing rhaines@ecpps.k12.nc.us. Please reference in the subject line: RFP # 181-2022100 – Request for Audit Report. Funds Elizabeth City-Pasquotank County Board of Education maintains the following funds: Governmental Funds • General Fund • State Public School Fund • Individual School Funds • Capital Outlay • Other Special Revenue Fund • Federal Grants Fund Enterprise Funds • School Service Funds • After School Enrichment Program Fund Budgets The unit budgets all funds on the modified accrual basis of accounting, as required by North Carolina law. Appropriations are made at the program code level. The Unit also maintains an encumbrance system. Both the budgetary and encumbrance systems are integrated with the accounting system to provide comparison with actual expenditures. Accounting Records The Unit maintains all its accounting records at the finance office located at 1200 Halstead Blvd, Elizabeth City, NC 27909. All accounting journals and subsidiary ledgers are maintained on AS400 SUNPAC software. mailto:rhaines@ecpps.k12.nc.us Page 12 of 13 Assistance Available to Auditor The Unit will make available to the auditor sufficient help to pull and re-file records, and prepare necessary confirmations. An electronic version of the trial balance with budgeted amounts will be made available at a mutually agreed time in order to meet the deadlines of this RFP. Auditors can expect the books will be balanced and all bank reconciliations completed such that auditor adjusting entries will be minimal, if necessary, excluding entries for financial statement presentation, which will be the responsibility of the audit team. Contact Information: Rachael Haines, Chief Finance Officer Email: rhaines@ecpps.k12.nc.us Page 13 of 13 SUMMARY OF AUDIT COSTS SHEET 1. Base Audit a. Includes Personnel costs, travel, and on-site work $_________________ 2. Extra Audit Service a. $__________per hour $_________________ 3. Financial Statement Preparation $_________________ 4. Other: (explain): $_________________ a. __________________________________________ TOTAL $_________________