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r ba 95 PAGE 471 On May 23, 1995, the audit selection ranking was presented to the Board of County Commissioners. At the meeting staff was directed to negotiate with the four top firms to obtain the best price for the County. Using a process prescribed by the County Attorney, all four firms were sent a copy of the proposed audit contract and asked to be prepared to give an all inclusive fee as well as estimated annual audit hours for each of the five years. of the agreement. Each firm was put in a separate conference room on June 7, 1995 and was asked to give its fee at that time. Beginning with the top ranked firm staff obtained the fee, then terminated negotiations with the firm and moved on to the next. Staff was advised by the County Attorney that the law allowed staff to terminate negotiations and revisit the first three firms to give them an opportunity to give a better price, however, the fourth. firm got only one opportunity and if negotiations are terminated they are eliminated. Staff suspended negotiations with the fourth firm, thus removing them from the process. Then the top ranked firms were given another opportunity to continue negotiating, which -two did. Ernst & Young/O'Haire Moran & Co. Chartered did not want to negotiate their fee of $512,500 any further. This resulted in the Blowing outcome: Fiscal Year Coopers & Lybrand Berger"arris Difference _ % Difference 1994/95 $90,000 $90,000 $0 0.0% 1995/96 $90,000 $90,000 $0 0.00/0 1996/97 $92,000 $90,000 $2,000 2.2% 1997/98 $93,000 $92,000 $1,000 1.1% 1998/99 $95,000 $93,000 $2,000 2.1% TOTAL $460,000 -$455,000 $5,000 1.1% Consent Letter Free Free Comfort Letter 2 free over 5 years then a max cost of $2,500 per letter 3 free over 5 years then a maxcost of $2,500 per Letter 1 free over 5 years The negotiating process set forth in law enabled staff to obtain prices which we feel were very favorable for the County. The audit fee will drop from the cost of $115,000 in 1993/94 to $90,000 for 1994/95 which is a savings of $25,000 or 22%. ANALYSIS Staff was left with evaluating all factors such as audit committee ranking, firm qualifications, importance of local firm presence and price. Below we have addressed each of these factors. Audit Committee Rankine - The audit committee was composed of all constitutional offers and a member of the Board of County Commissioners. Each has an important role in the process because each of their operations are audited separately and they are held accountable. Five of the six members ranked Coopers' & Lybrand first. In the composite score the best possible score a firm could receive was a 6 and the worst was 24. Coopers & Lybrand's composite score was an 8 and the next nearest firm was ranked 16 which was Ernst & Young/O'Haire Moran & Co. Chartered Firm Qualifications - Both Coopers & Lybrand and BergerRfarrisrToombslElan & McAlpin have the background, experience, resources and qualifications to do the job. Staff feels Cooper & Lybrand being a big six firm has an advantage in this area with its vast resources and qualifications. Importance of Local Presence - BergergarrisCToombs Elam & McAlpin is a local firm and definitely has an advantage here. More of the dollars would remain local. Price - Berger"arrislToombs Elam & McAlpin is the lowest bid at $455,000 or $5,000 less over the five years of the contract plus the additional free comfort letter. Both firms bid the same amount for the first two years and there is a 1.1 % difference in price. RECOMMENDATION Taking into consideration all of the factors, staff recommends the contract be awarded to Coopers & Lybrand. 24 June 20, 1995