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Item No. 7 <br />J <br />TO: Mayor, Mayor Pro -Tem, and City Council <br />Grayson Path, City Manager <br />FROM: Gene Anderson, Finance Director <br />SUBJECT: INDEPENDENT OUTSIDE AUDIT FOR FISCAL YEARS 2022-23,2023-24, <br />AND 2024-25 <br />DATE: March 13, 2023 <br />BACKGROUND: Article III Section 35 of the City Charter states that the City Council will <br />designate the certified public accountants to perform the annual independent audit of the City's <br />financial records. <br />STATUS OF ISSUE: The City requested, by two published advertisements in the Paris News, <br />proposals by qualified public accountants to perform audit services. One proposal was received <br />from McClanahan & Holmes, LLP. <br />BUDGET: The estimated fee is $68,500 plus out-of-pocket expenses such as postage and printing. <br />Out-of-pocket expenses normally run less than $300. If a single audit is required, additional fees <br />up to $5,000 may be charged. A single audit occurs when the City spends state or federal money <br />in excess of $750,000 in a fiscal year. Subsequent annual fee increases will be limited by the <br />change in the consumer price index published by the U.S. Department of Labor (CPI -U). <br />RECOMMENDATION: Motion to accept the proposal from McClanahan & Holmes, LLP to <br />conduct the annual financial audit for fiscal years 2022-23, 2023-24, and 2024-25. <br />