HomeMy WebLinkAboutFCS-14-049 - P14-042 Audit ServicesStaff Report
rTC.�r R finance and Corporate Services Department www.kitchener.ca
REPORT TO: Finance and Corporate Services
DATE OF MEETING: 2014 -08 -11
SUBMITTED BY: Brenda Johnson, Director of Accounting, 519 - 741 -2200 Ext 7647
PREPARED BY: Brenda Johnson, Director of Accounting, 519 - 741 -2200 Ext 7647
Larry Gordon, Director of Supply Services, 519 - 741 -2200 Ext
7214
WARD(S) INVOLVED: N/A
DATE OF REPORT: 2014 -07 -22
REPORT NO.: FCS -14 -049
SUBJECT: P14 -042 Audit Services
RECOMMENDATION:
That Proposal P14 -042, Audit Services, be awarded to KPMG LLP, Waterloo,
Ontario, at their proposed price of $733,400 plus H.S.T. of $95,342 for a total of
$828,742, for a five (5) year term beginning with the fiscal year ending December
31, 2014 for the Corporation of the City of Kitchener, its boards and enterprises,
Kitchener Housing Inc. and Kitchener Non - Profit Property Management Inc. and
for a five (5) year term beginning with the fiscal year ending May 31, 2015 for
Waterloo Region Municipalities Insurance Pool; and further;
That section 1.1 of Chapter 103 (Auditor) of the City's Municipal Code be
amended to effect the appointment of KPMG LLP as the City's Auditor.
BACKGROUND:
Under section 296(3) of the Municipal Act, an auditor shall not be appointed for a term
exceeding five (5) years. The Audit Committee appointed KPMG for the period 2009-
2013 and they have now completed their five (5) year term and an auditor needs to be
appointed for the next five (5) year term.
REPORT:
Proposals were requested from five (5) known audit firms, as well as advertised on the
City of Kitchener website and the Internet through the Ontario Public Buyers Electronic
Tendering Information System. Proposal documents were downloaded by thirteen (13)
interested parties and by the closing date of Tuesday May 20, 2014 five (5) proposals
had been received.
A selection committee comprised of the Mayor C. Zehr, Chair of the Audit Committee,
Councillor S. Davey, Chair of the Finance and Corporate Services Committee, D.
Chapman, Deputy CAO, Finance and Corporate Services & City Treasurer, B. Johnson,
Director of Accounting, C. Tasker, Internal Auditor and L. Gordon, Director of Supply
Services.
The selection committee met on June 12, 2014 to review the submissions and a
shortlist of two (2) firms were selected for further interviews. The selection committee
met on June 30, 2014 to interview the shortlisted firms. The selection committee
elected to award the proposal to KPMG LLP, Waterloo, Ontario.
Legal will submit to Council a by -law to amend Chapter 103 of the City of Kitchener
Municipal Code for the appointment of the Auditors.
The selection committee rated the firms on the following criteria.
• Firm's technical experience in municipal audits as well as audits for natural gas
utilities, ERP systems, charities, insurance industry, non- profit housing, library
boards and actuarial estimates
• Experience and qualifications of engagement team
• Responsiveness to and compliance with the Corporations requirements and
expectations
• Overall completeness and quality of the proposal
• Demonstration of value -added services
• Cost of services
• References
The following proposals were received:
BDO Canada LLP
Waterloo ON
Deloitte LLP
Kitchener ON
Grant Thornton LLP
Burlington ON
KPMG LLP
Waterloo ON
PricewaterhouseCoopers LLP
Waterloo ON
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
Theme: Financial Management
Strategic Direction: Ensure responsible use of public funds within a supportive policy
framework.
The City of Kitchener's purchasing policies and practices ensure openness, fairness
and transparency in the procurement of goods and services.
FINANCIAL IMPLICATIONS:
The total 2014 audit fee is 12.5% lower than the 2013 audit fee and increases by an
inflationary amount each year. Funding for the City's audit fees will be provided from
various operating and enterprise account codes.
COMMUNITY ENGAGEMENT:
INFORM — Potential vendors are informed of bid opportunities through the public
posting of bid documents as outlined in the City's Purchasing By -Law. Vendors, local
media and the general public are informed of purchasing recommendations to Council
through the public reports which are included with the Council agenda the week prior to
the Council meeting.
This report has been posted to the City's website with the agenda in advance of the
council / committee meeting.
ACKNOWLEDGED BY: Dan Chapman, Deputy CAO Finance and Corporate Services
& City Treasurer