AGENDA MEMORANDUM

Meeting Date: June 23, 2008

From:                          Jerry Boop, CPA, CGFO, Finance Director

Subject:                      Resolution authorizing extension of auditing services with Purvis Gray & Company for two years as provided for in the contract approved under Resolution 7365

Staff Recommendation:

Staff recommends approval of the agreement amending the contract with Purvis Gray & Company to provide annual independent auditing services pursuant to RFP-05-006 as provided for and approved under Resolution 7365.

Analysis:

Purvis Gray was contracted to provide audit services effective May 31, 2005.  The original contract expired with the delivery of the September 30, 2007 Comprehensive Annual Financial Report (CAFR).  Consideration was given to bid out the audit process. However, due to the training of new staff and the related pressure of placing the reporting process back in its proper cycle, staff determined that a contract extension is the appropriate course of action.  Any change in audit firms, at this time, could impede the continued development of the Accounting Staff.  Staff does recommend that a RFP be issued in fiscal year 2009 prior to the expiration of this extension in order to allow for review of price and service. 

The amendment reflects a new not to exceed price of $95,000.00 which allows for implementation of new audit standards.  The American Institute of Certified Public Accountants (AICPA) has recently issued a series on Statements on Accounting Standards (SAS) that are effective for the fiscal year ends of December 31, 2007 and later.  The new standards will result in the auditors performing more audit work in the following areas:

• A more in depth understanding of the audited entity and its environment, including its internal control;
• A more rigorous assessment of the risks of where and how financial statements could be materially misstated; and
• Improved linkage between the auditor’s assessed risks and the nature, timing and extent of audit procedures performed in response to those risks.

Staff estimates the auditors will need to spend 10% to 20% more time than previously spent on the audit to perform audits once the new SAS becomes effective.

Options:

1.  Approve the extension of an Agreement with Purvis Gray & Company to provide services as  

     described herein; or

2.  Such alternative action as the Commission may deem appropriate

Fiscal Impact: 

The new base price of $95,000.00 for the 2007-08 audit is an increase of approximately $8,000.00 over the total costs for the prior year audit and is included in the 2008-09 proposed budget.

Submission Date and Time:    6/20/2008 4:48 PM____

Department: ______________________ Prepared by:  ______________________                       Attachments:         Yes____   No ______ Advertised:   ____Not Required ______ Dates:   __________________________                      Attorney Review :       Yes___  No ____ _________________________________            Revised 6/10/04

Reviewed by: Dept. Head ________ Finance  Dept. _______JB___________                                    Deputy C.M. ________EFS________                                          Submitted by: City Manager ___________________

Account No. 001-1331-513-32-10_____ Project No. _____________________ WF No. ________________________ Budget  FY 2008-09 Proposed $95,000 Available ____$95,000_____________

RESOLUTION NO._______________

A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE THE EXTENSION OPTION OF RESOLUTION 7365 FOR TWO ADDITIONAL YEARS OF AUDIT SERVICE WITH PURVIS GRAY & COMPANY THROUGH AUDIT FOR FISCAL YEAR ENDING SEPTEMBER 30, 2009; AND PROVIDING AN EFFECTIVE DATE.

BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA:

            THAT the Mayor and City Clerk are hereby authorized to execute an agreement  with Purvis Gray and Company, whose address is 222 N.E. 1^st Street, Gainesville, Florida 32602 for Auditing Services Pursuant to RFP-05-006.

 THAT this resolution shall become effective immediately.

PASSED AND ADOPTED by the City Commission of the City of Leesburg, Florida, at a regular meeting held the _23rd____ day of _June____ 2008.

                                                                            __________________________

                                                                             Mayor

ATTEST:

__________________________

City Clerk