HomeMy WebLinkAboutRFP - Audit Services February 20231
REQUEST FOR PROPOSALS (RFP)
REQUEST FOR PROPOSALS FOR AUDIT SERIVES FOR THE CITY OF BOZEMAN, MONTANA
CITY OF BOZEMAN
Bozeman, MT
City of Bozeman
PO Box 1230
Bozeman, MT 59771-1230
February 2023
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NOTICE IS HEREBY given that the City of Bozeman (City) is seeking proposals from qualified independent
municipal auditors (hereinafter called Auditor), licensed by the State of Montana and having sufficient
governmental accounting and auditing experience in performing an audit in accordance with the specifications
outlined in the RFP. The audits will encompass a financial and compliance examination of the City’s Annual
Comprehensive Financial Report (ACFR). The work will also encompass a report on agreed-upon procedures for
the local building code enforcement program. This agreed-upon procedure needs to be performed in
accordance with attestation standards established by the American Institute of Certified Public Accountants.
The sufficiency of the procedures is solely the responsibility of the Montana State Department of Labor and
Industry, as required by ARM 24.301.208. The fee for the agreed-upon procedures should be separated out from
the audit services.
Copies of the Request for Proposals are available on the City’s website
All proposals must be provided as a single, searchable PDF document file and be submitted digitally as an email
attachment to the RFP Recipient email address below. Respondents are advised that Recipient’s email
attachment size limit is 25MB and that only one PDF file will be allowed per response. The subject line of the
transmittal email shall clearly identify the RFP title, company name and due date/time. File sizes greater than
25MB may be uploaded to bzncloud.bozeman.net upon special arrangement of the Recipient; however, it is the
respondent’s sole responsibility to ensure the file upload is completed, and that the Recipient is separately
notified via email of same, prior to the given deadline.
Deliver RFPs via email to the City Clerk by March 10, 2023, at 4:00pm MST. It is the sole responsibility of the
proposing party to ensure that proposals are received prior to the closing time as late submittals will not be
accepted and will be returned unopened.
The email address for submission is: agenda@bozeman.net
NON-DISCRIMINATION AND EQUAL PAY
The City of Bozeman is an Equal Opportunity Employer.
Discrimination in the performance of any agreement awarded under this RFQ on the basis of race, color, religion,
creed, sex, age, marital status, national origin, or actual or perceived sexual orientation, gender identity or
disability is prohibited. This prohibition shall apply to the hiring and treatment of the awarded entity’s
employees and to all subcontracts.
As such, each entity submitting under this notice shall include a provision wherein the submitting entity, or
entities, affirms in writing it will not discriminate on the basis of race, color, religion, creed, sex, age, marital
status, national origin, or because of actual or perceived sexual orientation, gender identity or disability and
which also recognizes the eventual contract will contain a provision prohibiting discrimination as described
above and that this prohibition on discrimination shall apply to the hiring and treatment of the submitting
entity’s employees and to all subcontracts.
In addition, pursuant to City Commission Resolution 5169, the entity awarded a contract under this RFP and any
subcontractors must abide by the Equal Pay Act of 1963 and Section 39-3-104, MCA (the Montana Equal Pay
Act), and affirm it will abide by the above and that it has visited the State of Montana Equal Pay for Equal Work
“best practices” website, or equivalent “best practices publication and has read the material.
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Any administrative questions regarding proposal procedures should be directed to: Mike Maas, City Clerk (406)
582-2321, agenda@bozeman.net.
Questions relating to the RFP should be directed to: Aaron Funk, Controller, (406) 582-2335,
afunk@bozeman.net.
DATED at Bozeman, Montana, this 19th of February 2023.
Mike Maas
City Clerk
City of Bozeman
For publication on:
Sunday, February 19, 2023
Sunday, February 26, 2023
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I. INTRODUCTION
The City of Bozeman (Owner) is seeking proposals from qualified independent municipal audit firms to perform
the annual independent audit of the City’s financial records and agreed-upon procedures for the local building
code enforcement program.
The Owner intends to enter into a contract with the selected firm that will include a short description of project
scope. The Owner will not reimburse audit firms for any expenses incurred in preparing proposals in response
to this request.
This RFP shall not commit the Owner to enter into an agreement, to pay any expenses incurred in preparation
of any response to this request, or to procure or contract for any supplies, goods or services. The Owner reserves
the right to accept or reject all responses received as a result of this RFP if it is in the Owner’s best interest to
do so.
This procurement is governed by the laws of the State of Montana and venue for all legal proceedings shall be
in the 18th Judicial District Court, Gallatin County. By offering to perform services under this RFP, all Submitters
agree to be bound by the laws of the State of Montana and of the Owner, including, but not limited to, applicable
wage rates, payments, gross receipts taxes, building codes, equal opportunity employment practices, safety,
non-discrimination, etc.
II. PROJECT BACKGROUND AND DESCRIPTION
The reporting entity for this contract is the City of Bozeman, a Montana municipal corporation governed by an
elected City Commission. The Annual Comprehensive Financial Report (ACFR) presents the activities of the
City. In fiscal year 2022 the ACFR presented four major governmental funds, 2 major proprietary funds and 37
non-major funds (including fiduciary and internal service). The City serves a population of approximately
55,000 with approximately 478 employees. The City self-insures for general liability, property, and worker’s
compensation through the Montana Municipal Interlocal Authority. All eligible City employees participate in
the Montana Public Employee Retirement Administration programs. The audit reporting entity may change
over the audit contract period.
Auditors are encouraged to review the official website of the City of Bozeman at www.bozeman.net. The
website contains information to include:
• The Mayor and City Commission
• The City departments and their responsibilities
• Adopted budgets
• Annual Comprehensive Financial Reports
The City has received a Certificate in Excellence in Financial Reporting every year since fiscal year 1984 and
plans to continue to submit the ACFR for review by the Government Finance Officers Association.
III. SCOPE OF SERVICES
Periods to be Audited
• July 1, 2022, through June 30, 2023 – Fiscal Year 2023
• July 1, 2023, through June 30, 2024 – Fiscal Year 2024
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• July 1, 2023, through June 30, 2025 – Fiscal Year 2025
The City will retain the option to extend the contract through the 2026, and 2027 fiscal years.
Professional Services Required
1. The audit shall be conducted in accordance with:
• Generally Accepted Auditing Standards (GAAS).
• Government Auditing Standards issued by the Comptroller General of the United States.
• Title 2 U.S. code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost
Principals, and Audit Requirements for Federal Awards “Uniform Guidance”.
• The Auditor shall comply with state laws contained in Title 2, Chapter 7, of the Montana Code
Annotated and related rules set forth by Local Government Services of the Department of
Administration as stated in the LGS Contract.
• The Single Audit Act of 1984 and all amendments.
• The auditors shall familiarize themselves with and comply with the provisions of any and all
Federal, State and City orders, statutes, ordinances, bond covenants, and administrative rules and
regulations which may pertain to the work required in the engagement.
2. The planning phase of the audit engagement may commence upon notification of the acceptance of
their proposal. The Auditor shall meet with the Finance Director and Controller prior to the
commencement of each fiscal year to discuss the Auditor’s planned approach to the audit and to
provide a list of schedules to be prepared by City personnel prior to the beginning of risk assessment
procedures and interim or fieldwork stages. The schedule and procedures will be developed in
conjunction with the City and shall be subject to approval by the City. City staff will be as flexible as
possible to meet the Auditor’s scheduling needs. The audit firm must state in its proposal if changes to
the schedule would result in additional costs.
Previous audits have followed the approximate schedule:
• July/August – Entrance conference and planning/risk assessment
• September/October – Fieldwork
• October/November – ACFR drafts and reviews
• November/Early December – Audit completion and ACFR Issuance
• December/January – Audit presentation to the City Commission
3. Audit Conferences:
• The Auditor will have an entrance conference with the Finance Director and Controller.
• The Auditor will meet with the Finance Director and Controller for the purpose of reviewing
audit findings and recommendations prior to the issuance of management letters,
certifications, or reports. The Auditor will present the final reports to the City Commission.
4. Perform an agreed upon procedures engagement necessary to satisfy the reporting format adopted by
the Building codes Bureau at ARM 24.301.208.
5. OPTIONAL: ACFR Preparation - The City is planning to transition to preparing the ACFR, however prior
ACFR’s have been prepared by the Auditor through fiscal year 2022. While not required, if the Auditor
elects to offer preparation services for fiscal year 2023 the Auditor should include a separate fee for
the preparation of the complete ACFR.
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City Responsibilities
1. The City will provide:
• Draft financial statements and/or formatted trial balance ready for audit.
• Schedules, reconciliations, vouchers in support of accounts payable, statements, and
spreadsheets used for closing.
• Access to all files and records of the City departments.
2. City staff will not prepare auditor work papers or data entry.
Auditor Responsibilities
1. The Auditor should be familiar with and prepared to advise City staff on how best to implement both
current and proposed Government Accounting Standards Board (GASB) Statements. In addition, the
Auditor is also expected to provide informal advice and consultation through the audit contract period
on matters relating to accounting and financial reporting at no additional cost. This would not
necessarily include any task that entails significant research or a formal report.
2. The Auditor will review and assist in the preparation of the ACFR to assure the City continues to obtain
the Certificate of Achievement for Excellence in Financial Reporting.
3. The Auditor will issue all required reporting upon completion of the audit (Exhibit B). The Auditor will
complete the Single Audit Reporting Package, including the SF-SAC Single Audit Data Collection Form
for the City to the Federal Audit Clearinghouse (FAC). The Auditor will complete all reporting required
by the Local Government Services.
4. In addition to the auditors’ normal internal control review procedures, the auditors will perform an in-
depth review of the City’s internal control procedures of one area each year as selected by the City.
5. OPTIONAL: If elected for fiscal year 2023, the Auditor will prepare and provide a complete draft of the
ACFR based on the schedule noted above to enable the City to review for possible changes. The
proposal should include this work as a separate fee in the cost proposal.
IV. PROPOSAL REQUIREMENTS
Firms interested in providing the services described above are requested to submit the following information.
Responses to each item should appear in the same order as in this RFP and should identify the item to which
the responses apply.
a) Title Page
Show the RFP subject, the name of the proposer’s firm, mailing address, location address, telephone
number, name of contact person, and the date.
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b) Experience and Other Qualifications
I. Provide a list of the Auditor’s current and recent government audit clients, indicating the
type(s) of services performed and the number of years served for each. Provide names,
addresses, email addresses, and telephone numbers of personnel of current and prior
government audit clients who may be contracted by the City for reference.
II. State whether the firm is local, regional, or national. Give the location for which the work is to
be done and number of partners, managers, supervisors, seniors, and other professional staff
employed at that office. Describe the range of activities performed by the office such as audit
and accounting, tax, and/or management advisory services.
III. 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 including
management letter and responses, if any. Indicate whether the review included government
engagements.
IV. Identify the partners, managers and supervisors who will work on the audit. Resumes for each
supervisory person to be assigned to the audit should be included. The resumes may be
included as an appendix. Engagement partners, managers, or other supervisory staff or
specialists may be changed if those personnel leave the firm. However, the City retains the
right to approve or reject replacements.
V. Describe how the firm meets professional independence standards.
VI. Describe liability insurance coverage arrangement to assure that it is sufficient to cover claims.
VII. Describe and regulatory action taken by any oversight body against the audit organization or
local office, if any.
c) Scope of Services
I. Describe your understanding of the scope of work and the expertise your firm has in this area
of work.
II. Provide information concerning the audit approach that will be taken – i.e., proposed staffing
plan for each stage of the engagement, proposed audit schedule that meet the scope criteria,
sampling techniques, and analytical procedures.
III. Identify any potential audit difficulties such as inability to comply with any requirements listed
above, along with the firm’s proposed resolution and any additional assistance expected from
City staff not listed above.
IV. OPTIONAL: Provide information concerning preparing the ACFR for fiscal year 2023.
V. Provide any other information you believe relevant to the decision of selection of the best audit
firm for the City.
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d) Cost Proposal
I. Proposals should include cost estimates and other necessary cost information. The
responsibility for submitting the proposal on or before the above stated time and date is solely
that of the Auditor. The City will in no way be responsible for delays in mail delivery or delays
caused by any other occurrence.
II. Describe the organization of the audit team and the approximate percentage of time spent on
the audit by each member.
III. Provide a tentative schedule for completing the audit within the specified deadlines.
IV. Specify costs for audit services for fiscal years ended June 30, 2023, June 30, 2024, and June 30,
2025. The cost of auditing fiscal years ended June 30, 2023, 2024, and 2025 are binding. Include
estimated hours, hourly cost and total cost per level of personnel assigned, total personnel
costs and any related costs such as travel, cost of supplies and materials, preparation costs and
any other costs. If travel costs are necessary, the total cost much include the Auditor’s full
travel costs, with the audit firm assuming any additional costs related to travel cost changes
(i.e., The Auditor cannot request a change to the contract if travel costs or hours related to
travel change for any reason.) Please split out costs for the audit services and the agreed upon
procedures.
V. Identify and describe any other important cost-based information such as additional charges for
unanticipated events and how they would be determined.
VI. Specify costs for agreed upon procedures for the building code enforcement engagement.
VII. OPTIONAL: Specify the cost of preparation of the City’s ACFR for fiscal year 2023.
e) Affirmation of Nondiscrimination (see Appendix A)
Non-completion of the Affirmation of Nondiscrimination is cause for disqualification of firms.
V. TIMELINES, DELIVERY DEADLINE, AND INSTRUCTIONS
EVENT DATE/TIME
Publication dates of RFP Sunday, February 19, 2023
Sunday, February 26, 2023
Deadline for receipt of proposals March 10, 2023, by 4:00 PM
Evaluation of proposals TBD
Interviews (if necessary) and Selection of
consultants
TBD
With the exception of the advertising dates and advertised due date, the City reserves the right to modify the
above timeline.
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Deliver RFPs via email to the City Clerk (agenda@bozeman.net) by March 10, 2023, at 4:00PM MST. It is the
sole responsibility of the proposing party to ensure that proposals are received prior to the closing time as late
submittals will not be accepted and will be returned unopened. All proposals must be provided as a single,
searchable PDF document file and be submitted digitally as an email attachment to the RFP Recipient email
address agenda@bozeman.net. Respondents are advised that Recipient’s email attachment size limit is 25MB
and that only one PDF file will be allowed per response. The subject line of the transmittal email shall clearly
identify the RFP title, company name and due date/time. File sizes greater than 25MB in size may be uploaded
to bzncloud.bozeman.net upon special arrangement of the Recipient; however, it is the respondent’s sole
responsibility to ensure the file upload is completed, and that the Recipient is separately notified via email of
same, prior to the given deadline.
VI. AMENDMENTS TO SOLICITATION
Any interpretation or correction of this request will be published on the City’s webpage. The deadline for
questions related to this document is 4:00PM MST on March 6, 2023.
VII. CONTACT INFORMATION
Any administrative questions regarding proposal procedures should be directed to: Mike Maas, City Clerk, (406)
582-2321, agenda@bozeman.net
Questions relating to scope of services should be directed to:
Aaron Funk, CPA
Controller
City of Bozeman
afunk@bozeman.net
406-482-2335
VIII. SELECTION PROCEDURE
A review committee will evaluate all responses to the RFP that meet the submittal requirements and deadline.
Submittals that do not meet the requirement or deadline will not be considered. The review committee will rank
the proposals and may arrange interviews with the finalist(s) prior to selection. Selection may be made directly
based on the written RFP submission.
If interviews occur, the selection of finalists to be interviewed will be made by a selection committee
representing the City of Bozeman. The selection of interview candidates will be based on an evaluation of the
written responses to the RFPs.
All submitted proposals must be complete and contain the information required as stated in the "Request for
Proposals.”
IX. SELECTION CRITERIA
Proposals will be evaluated based on the following criteria:
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a. [5 points] Mandatory elements – Auditor MUST demonstrate that:
i. The audit firm is independent, licensed to practice in Montana and listed on the State of
Montana, Department of Administration roster.
ii. The audit firm has no conflict of interest with regard to any other work performed by the firm for
the City or other entities.
iii. The audit firm adheres to the instructions in this request for proposal on preparing and
submitting the proposal.
iv. The audit firm submits a copy of the last quality control review report, and the firm has a record
of quality audit work.
b. [65 points maximum] Technical Qualifications
i. The Auditor’s past experience and performance on comparable government engagements.
ii. The quality of the Auditor’s professional personnel to be assigned to the engagement and the
quality of the Auditors’ management support personnel to be available for technical
consultation.
c. [30 points maximum] Fees
i. Estimated cost as compared with other bids.
The award to the audit firm will also conform to the Administrative Rules of Montana, section 2.4.407, which
states:
2.4.407 CRITERIA FOR THE SELECTION OF THE INDEPENDENT AUDITOR
1) In selecting an independent auditor to perform and audit under 2-7-503, MCA, a local government entity
shall consider the following criteria:
a) listing on department’s roster of independent auditors authorized to conduct local government audits;
b) independence, as defined by applicable auditing standards;
c) demonstrated understanding of the work to be performed;
d) technical experience of the independent auditor in conducting similar types of local government entity
audits;
e) qualifications of staff to be assigned to the audit;
f) work history of the independent auditor; and
g) the proposed audit fee
2) The department may require the local government entity to demonstrate that the independent auditor
selected is qualified to conduct the audit based on an evaluation of:
a) the criteria established in (1) above;
b) any additional information requested by and used by the local government entity in selecting the
independent auditor; and
c) the results of oral interviews of independent auditors conducted by the local government entity, if
appropriate.
X. FORM OF AGREEMENT
The Contractor will be required to enter into a contract with the City in substantially the same form as the
professional services agreement attached as Attachment B.
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XI. CITY RESERVATION OF RIGHTS / LIABILITY WAIVER
All proposals submitted in response to this RFP become the property of the City and public records and, as
such, may be subject to public review.
A SUBMISSION IN RESPONSE TO THIS REQUEST FOR QUALIFICATIONS CONFERS NO RIGHTS UPON ANY
RESPONDENTS AND SHALL NOT OBLIGATE THE CITY IN ANY MANNER WHATSOEVER. THE CITY RESERVES THE
RIGHT TO MAKE NO AWARD AND TO SOLICIT ADDITIONAL REQUEST FOR QUALIFICATIONS AT A LATER DATE.
A. This RFP may be canceled or any or all responses may be rejected in whole or in part, as specified
herein, when it is in the best interests of the City. If the City cancels or revises this RFP, all Respondents
who submitted will be notified using email.
B. The City reserves the right to accept or reject any and all proposals; to add or delete items and/or
quantities; to amend the RFP; to waive any minor irregularities, informalities, or failure to conform to
the RFP; to extend the deadline for submitting proposals; to postpone award for up to 60 days; to
award one or more contracts, by item or task, or groups of items or tasks, if so provided in the RFP and
if multiple awards or phases are determined by the City to be in the public interest.
C. The City of Bozeman reserves the right to reject the proposal of any person/firm who previously failed
to perform properly to the satisfaction of the City of Bozeman, or complete on time agreements of
similar nature, or to reject the proposal of any person/firm who is not in a position to perform such an
agreement satisfactorily as determined by the City of Bozeman.
D. The City of Bozeman reserves the right to determine the best qualified Contractor and negotiate a final
scope of service and cost, negotiate a contract with another Contractor if an agreement cannot be
reached with the first selected Contractor, or reject all proposals.
E. The professional services contract between the City of Bozeman and the successful Contractor will
incorporate the Contractor's scope of service and work schedule as part of the agreement (see
Appendix B for form of professional services agreement. The professional services agreement
presented to the Contractor may differ from this form as appropriate for the scope of services).
F. This RFP does not commit the City to award a contract. The City assumes no liability or responsibility
for costs incurred by firms in responding to this request for proposals or request for interviews,
additional data, or other information with respect to the selection process, prior to the issuance of an
agreement, contract or purchase order. The Contractor, by submitting a response to this RFP, waives
all right to protest or seek any legal remedies whatsoever regarding any aspect of this RFP.
G. The City reserves the right to cancel, in part or in its entirety, this RFP including, but not limited to:
selection procedures, submittal date, and submittal requirements. If the City cancels or revises this
RFP, all Contractors who submitted proposals will be notified using email.
H. Projects under any contract are subject to the availability of funds.
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XII. NONDISCRIMINATION AND EQUAL PAY POLICY
The City of Bozeman requires each entity submitting under this notice shall affirm, on a separate form
provided, that it will not discriminate on the basis of race, color, religion, creed, sex, age, marital status,
national origin, or because of actual or perceived sexual orientation, sexual preference, gender identity, or
disability in fulfillment of a contract entered into for the services identified herein and that this prohibition
on discrimination shall apply to the hiring and treatment of the submitting entity’s employees and to all
subcontracts it enters into in the fulfillment of the services identified herein. Failure to comply with this
requirement shall be cause for the submittal to be deemed nonresponsive.
The City also requires each entity submitting under this notice shall affirm it will abide by the Equal Pay Act
of 1963 and Section 39-3-104, MCA (the Montana Equal Pay Act), and has visited the State of Montana Equal
Pay for Equal Work “best practices” website, https://equalpay.mt.gov/BestPractices/Employers, or
equivalent “best practices publication and has read the material.
XIII. MISCELLANEOUS
A. No Oral Agreements. No conversations or oral agreements with any officer, employee, or agent of the
City shall affect or modify any term of this solicitation. Oral communications or any written/email
communication between any person and City officer, employee or agent shall not be considered binding.
B. No Partnership/Business Organization. Nothing in this solicitation or in any subsequent agreement, or
any other contract entered into as a result of this solicitation, shall constitute, create, give rise to or
otherwise be recognized as a partnership or formal business organization of any kind between or among
the respondent and the City.
C. Employment Restriction and Indemnity. No person who is an owner, officer, employee, contractor,
or consultant of a respondent shall be an officer or employee of the City. No rights of the City’s
retirement or personnel rules accrue to a respondent, its officers, employees, contractors, or
consultants. Respondents shall have the responsibility of all salaries, wages, bonuses, retirement,
withholdings, worker’s compensation and occupational disease compensation, insurance,
unemployment compensation other benefits and taxes and premiums appurtenant thereto
concerning its officers, employees, contractors, and consultants. Each Respondent shall save and hold
the City harmless with respect to any and all claims for payment, compensation, salary, wages,
bonuses, retirement, withholdings, worker’s compensation and occupational disease compensation,
insurance, unemployment compensation other benefits and taxes and premiums in any way related
to each respondent’s officers, employees, contractors and consultants.
D. Accessibility. Upon reasonable notice, the City will provide assistance for those persons with sensory
impairments. For further information please contact the ADA Coordinator Mike Gray at 406-582-3232
or the City’s TTY line at 406-582-2301.
E. Procurement. When discrepancies occur between words and figures in this solicitation, the words
shall govern. No responsibility shall attach to a City employee for the premature opening of an RFP
not properly addressed and identified in accordance with these documents.
F. Governing Law. This solicitation and any disputes arising hereunder or under any future agreement
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shall be governed and construed and enforced in accordance with the laws of the State of Montana,
without reference to principles of choice or conflicts of laws.
XIV. ATTACHMENTS
The following exhibits are incorporated in this RFP:
Appendix A: Non-Discrimination Affirmation
Appendix B: Department of Administration Standard Audit Contract
END OF RFP
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Attachment A
NONDISCRIMINATION AND EQUAL PAY AFFIRMATION
____________________________________(name of entity submitting) hereby affirms it will not discriminate
on the basis of race, color, religion, creed, sex, age, marital status, national origin, or because of actual or
perceived sexual orientation, gender identity or disability and acknowledges and understands the eventual
contract will contain a provision prohibiting discrimination as described above and this prohibition on
discrimination shall apply to the hiring and treatments or proposer’s employees and to all subcontracts.
In addition, ____________________________________(name of entity submitting) hereby affirms it will
abide by the Equal Pay Act of 1963 and Section 39-3-104, MCA (the Montana Equal Pay Act), and has visited
the State of Montana Equal Pay for Equal Work “best practices” website,
https://equalpay.mt.gov/BestPractices/Employers, or equivalent “best practices publication and has read the
material.
______________________________________
Name and title of person authorized to sign on behalf of submitter
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Appendix B
DEPARTMENT OF ADMINISTRATION STANDARD AUDIT CONTRACT
This Contract is made this day of , 20 , by and among
Certified Public Accountant ("Contractor"), Governmental Entity ("Entity"),
and the Montana Department of Administration, Local Government Services, ("State"), acting under the authority of Title 2, Chapter 7, Part 5, of the Montana Code Annotated. The State’s mailing address, phone number and e-mail address are P.O. Box 200547, Helena, MT 59620-0547; (406) 444-9101; and LGSPortalRegistration@mt.gov.
1. Effective Date: This contract is not effective with respect to any party until it is approved and signed by the State, as required by Section 2-7-506(3), MCA. The Contractor may not begin any audit work until the State gives this approval. If the Contractor begins work before the State’s approval of the
contract and the State subsequently does not approve the contract, the Contractor is not entitled to receive
any compensation for the work performed. 2. Audit Period and Payment: This contract covers the following audit period(s): , 20 to , 20 .
A. The Entity shall pay the Contractor for the audit work on the basis of time and necessary out-of-pocket expenses, which will not exceed: $ for initial (or sole) audit covering / / to / / .
$ for subsequent audit covering / / to / / .
$ for subsequent audit covering / / to / / . The Entity shall pay the fees listed in Appendices A, B & C, as applicable, which are attached hereto and incorporated by reference. Any change to the audit fees requires a contract amendment.
B. The contract payments do not include the cost of additional work that may be required if the Contractor discovers a defalcation or material irregularity. Any change in the scope of the audit services to be provided under this contract requires a contract amendment.
C. The Contractor may submit interim bills to the Entity each month, based upon the estimated
percentage of contract completion. The Entity may retain ten percent (10%) of each of these estimates until the Contractor has delivered the final audit report, at which time the Entity shall release the amount retained.
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3. Peer Review: The Contractor shall provide the Entity with a copy of its most recent external peer review report and any letter of comment, and any subsequent peer review reports and letters of comment received during the contract period.
4. Audit Scope: The Contractor shall perform the following:
A. The Contractor shall conduct the audit in accordance with (i) generally accepted auditing standards adopted by the American Institute of Certified Public Accountants and (ii) the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of
the United States.
The Contractor shall opine on the presentation of the Entity’s financial statements in accordance with the Entity’s applicable financial reporting framework prescribed at Section 2-7-504, MCA.
If the Contractor’s opinion on the Entity’s financial statements is other than unmodified, the Contractor
shall fully discuss the reasons with the Entity in advance of issuing a report. If, for any reason, the Contractor is unable to complete the audit or is unable to form or has not formed an opinion, the Contractor may decline to express an opinion or decline to issue a report as a result of the engagement.
B. The Contractor shall perform tests of internal control over financial reporting. Findings resulting from
these tests shall be reported in accordance with Government Auditing Standards C. The Contractor shall perform tests of the Entity’s compliance with provisions of laws, regulations, contracts, and grant agreements. The Contractor shall use the local government compliance
supplement prepared by the State, as required by Section 2-7-505(2), MCA, in conjunction with
Government Auditing Standards to determine the compliance testing to be performed during the audit. Findings resulting from these tests shall be reported in accordance with Government Auditing Standards. If the Contractor becomes aware of fraud, waste or abuse, the Contractor shall report related findings in accordance with Government Auditing Standards. The Contractor shall perform
tests, including but not limited to the following, to determine whether:
(1) the Entity has complied with all appropriate statutes and regulations, as required by Section 2-7-502, MCA;
(2) the Entity has complied with the provisions of each of its debt covenants and agreements;
(3) if the audit is of a county, city or town, the Entity has retained money in a local charge for services fund contrary to the requirements of Sections 17-2-301 through 17-2-303, MCA, as required by Section 17-2-302, MCA. The Contractor shall report any findings of
noncompliance with the provisions of these statutes, regardless of materiality; and
(4) if the audit is of a county or consolidated city/county government, the Entity has complied with state laws relating to receipts and disbursements of agency or custodial funds maintained by the Entity, as required by Section 2-7-505, MCA.
If required by the State, the Contractor shall provide documentation of testing performed to comply with (3) and (4), above.
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D. When applicable, the audit must meet all requirements of the Federal Single Audit Act of 1984, as
amended, and Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards (“Uniform Guidance”). If these federal regulations are amended, the amended regulations will prevail. E. The audit scope with regard to federal financial assistance for each fiscal year covered by this contract
must be as specified in Appendices A, B and C. Any change to the audit scope with regard to federal
financial assistance requires a contract amendment. F. Except as provided below, for purposes of determining the scope of the audit, the Entity is considered the financial reporting entity as defined in the Entity’s applicable financial reporting framework
prescribed at Section 2-7-504, MCA. This provision does not preclude the Entity from engaging a
different audit firm for the audit of a segment, fund or component unit of the Entity. However, both the Entity and Contractor shall notify the State whenever the Entity elects to engage a different audit firm for the audit of a segment, fund or governmental component unit. Such additional audit must be contracted for on the State’s Standard Audit Contract, and the audit firm shall be on the Roster of
Independent Auditors authorized to conduct audits of Montana local governments that is maintained
by the State. If this contract is for an audit of a segment, fund, or governmental component unit of the primary government, the Entity is considered to be the segment, fund or component unit.
G. Any school district audit must also include auditing procedures sufficient to provide an opinion as to whether the following supplemental information is fairly stated in relation to the basic financial statements:
(1) the school district's enrollment for the fiscal year or years being audited as reported to the Office
of Public Instruction in the Fall and Spring “Student Count for ANB” reports; and (2) when applicable, the extracurricular funds for pupil functions.
H. If the Entity is a school district or associated cooperative, the Contractor shall contact the State Office
of Public Instruction and the county superintendent of schools before or during the audit of the Entity. The Contractor shall determine whether those offices are aware of potential financial or legal compliance problems relating to the Entity that could affect the scope of the audit.
I. The Contractor shall immediately notify the Entity and the State in writing of any material
irregularities it discovers. If the Entity is a school district or special education cooperative, the Contractor shall also immediately notify the State Office of Public Instruction in writing. To notify the State, Contractors shall email LGSPortalRegistration@mt.gov to the attention of the Local Government Services Bureau Chief. To notify the State Office of Public Instruction, Contractors
shall email OPIAuditReport@mt.gov to the attention of the OPI Auditor.
J. The Contractor shall notify the Entity of all proposed audit adjustments and, if the Entity concurs, shall obtain written acceptance of these proposed adjustments. The State reserves the right to request documentation of these proposed and accepted audit adjustments.
5. Entity’s Responsibilities: The Entity shall be responsible for: A. its basic financial statements, including note disclosures;
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B. all supplementary information required by its applicable financial reporting framework prescribed at
Section 2-7-504, MCA and by provisions of this contract;
C. establishing and maintaining effective internal control over financial reporting, including internal controls related to the prevention and detection of fraud;
D. ensuring that it complies with the laws, regulations, contracts and grant agreements applicable to its
activities; E. making all financial records and related information available to the Contractor;
F. the schedule of expenditures of federal awards required for audits conducted under Uniform
Guidance; G. approving all proposed audit adjustments before posting, if the Entity concurs with the proposed adjustments;
H. adjusting the financial statements and accounting records to correct material misstatements and to agree with the audited financial statements; and I. providing the Contractor, at the conclusion of the audit engagement, with a letter that confirms certain
representations made during the audit, including an affirmation that the effects of any uncorrected
misstatements aggregated by the auditor during the current engagement and pertaining to the latest period presented are immaterial, both individually and in the aggregate, to the financial statements taken as a whole.
6. Dates for Annual Financial Report or Trial Balance of Accounts: The Entity shall prepare its annual
financial report or a trial balance of accounts no later than the dates specified in Appendices A, B and C. If the Entity is unable to prepare its annual financial report or trial balance by the date specified in the Appendices, the Entity shall notify the Contractor and the State in writing prior to the specified dates.
7. Beginning the Audit: The Contractor shall begin the audit field work based on the schedule established in
Appendices A, B and C. Under Section 2-7-503(3)(a), MCA, all audits must commence within nine months from the close of the last fiscal year of the audit period. 8. Completion of Audit: The Contractor shall deliver the audit report to the Entity and the State, based on the schedule established in Appendices A, B and C. If the Contractor cannot deliver the audit report to the Entity and the State on the date specified in the Appendices, the Contractor shall notify the Entity and the State in writing of that fact, and the reason(s) for the delay. Under Section 2-7-503(3)(a), MCA, all audits
must be completed and the reports issued within one year from the close of the last fiscal year covered by
the audit. If the audit is conducted in accordance with the provisions of Uniform Guidance, the Contractor shall complete the audit and issue the audit report within the time period required by that federal regulation, unless a longer period has been agreed to in advance by the federal cognizant or oversight agency for audit. If the Entity has requested and received an extension of the due date of the Uniform Guidance from a federal
agency, the Entity shall submit a copy of the approved extension to the State.
9. Due Date Extension: The State may grant an extension to the Entity for filing the audit report beyond the one- year due date provided for in paragraph 8, above. To do so, the Entity shall make a request to the State in writing and shall show good cause for the delinquency or demonstrate that the failure to meet the deadline
provided for in paragraph 8, above, was the result of circumstances beyond the Entity’s control. The State
will determine good cause or circumstances beyond the Entity’s control based on the facts of each case.
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10. Presentation of Audited Financial Statements: The final audit report must contain basic financial
statements and supplementary information consistent with the applicable financial reporting framework prescribed at Section 2-7-504, MCA. In addition, other supplementary information required by provisions within this contract and by Uniform Guidance must also be included, if applicable.
A. The final audit report must also contain any supplementary or other information as agreed upon by the
Entity and Contractor. B. If the Entity’s accounting records or other circumstances do not permit financial statements to comply with the applicable financial reporting framework prescribed at Section 2-7-504, MCA, the Contractor
shall notify the State of those conditions and describe the financial statements that will be presented.
The applicable auditor’s reports must be modified in accordance with professional standards to reflect a departure from the applicable financial reporting framework.
C. If the audit is of a school district with separate elementary and high school district general funds, the general funds must be combined as a single major fund. All other funds must be separately considered for major fund criteria. D. If the audit is a biennial audit covering two years, the Contractor shall present complete financial
statements as specified above for each year covered by the audit. However, note disclosures for both fiscal years may be in one set of notes, with separate fiscal year disclosures as necessary. The two years must be presented under one audit report cover and opined upon in one Independent Auditor’s Report.
11. Auditor’s Reports: All audit reports must contain the following auditor's reports, which must comply with applicable professional standards in effect for the fiscal year or years being audited: A. a report on the financial statements of the Entity;
B. a report on internal control over financial reporting and on compliance and other matters based on an audit of financial statements performed in accordance with Government Auditing Standards. C. a reference to a report disclosing any deficiencies in internal control or instances of noncompliance with provisions of contracts or grant agreements or abuse that have a less than material effect on the
financial statements but warrant the attention of management or those charged with governance. This report must be referred to in the report required in 11.B. above. D. a report on any supplementary or other information presented in the audit report. This report must be
given in an “other matters” paragraph(s) of the auditor’s report on the financial statements (11.A.
above), and shall identify, if applicable: (1) Any Required Supplementary Information (RSI), as required by the Governmental Accounting Standards Board.
(2) Any Supplementary Information (SI) included in the report to comply with provisions of laws, regulations, contracts, or grant agreements. For the following schedules, the Contractor shall report on whether the information is fairly stated, in all material respects, “in relation to” the financial statements as a whole, unless the condition of the financial records do not allow the
auditor to render such an opinion:
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a) schedule of school district “Student Count for ANB” required in paragraph 13.A.;
b) schedule of school district extracurricular fund financial activities required in paragraph 13.B.; c) schedule of expenditures of federal awards required by Uniform Guidance and in paragraph
12.A.; and
d) Any supplementary information for financial reporting frameworks required by A.R.M. 2.4.401.
(3) Any Other Information (OI) for financial reporting frameworks required by A.R.M. 2.4.401.
(4) Any Other Information (OI) that is included in the audit report, if deemed appropriate in accordance with professional standards.
E. a report disclosing the action taken by the Entity to correct any deficiencies or implement any
recommendations contained in the prior audit report. This report must be in a format that
specifically identifies, by title or summary, each deficiency or recommendation contained in the
prior audit report and the action taken by the Entity on each such deficiency or recommendation. F. If the Contractor includes audit findings in the reports referenced in 11.B. and 11.C. above, the views of Entity officials and their planned corrective actions must also be included, as required by
Government Auditing Standards, if they are available at the time the Contractor submits the audit
report to the State. If the views and planned corrective actions are not available at that time, the Contractor shall so indicate in the reports.
12. Single Audits: All audit reports for single audits done in accordance with Uniform Guidance must contain
the following:
A. a schedule of expenditures of federal awards, prepared by the Entity, which must contain all
elements required by Uniform Guidance.
B. a report on the schedule of expenditures of federal awards. This report may be combined with other
reports as provided by Uniform Guidance and professional standards. This report must comply with applicable professional standards in effect for the fiscal year or years being audited. C. a report on compliance for each major program and a report on internal control over compliance in accordance with Uniform Guidance. These reports must refer to the separate schedule of findings and
questioned costs described in paragraph 12.D. of the contract and must comply with applicable professional standards in effect for the fiscal year or years being audited. D. a schedule of findings and questioned costs which must include the information required by Uniform Guidance.
E. an Entity-prepared document, separate from the Contractor’s findings, that describes the Entity’s corrective action plan in accordance with Uniform Guidance for each current-year audit finding, if that plan is available at the time the Contractor submits the audit report to the State. This document should be submitted on Entity letterhead and should include a corrective action plan for each finding,
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regardless whether the finding is identified in accordance with Uniform Guidance or Government
Auditing Standards.
13. School Districts: School district audit reports must include the following as supplementary information/schedules:
A. a schedule of the district's enrollment as reported to the Office of Public Instruction for the fiscal year
or years being audited. The schedule must contain the enrollment both as reported in the Fall and Spring “Student Count for ANB” reports and as documented by the school district's enrollment records; and
B. a detailed schedule of extracurricular fund financial activities.
14. Local Governments Reporting on Non-GAAP Financial Reporting Framework: Audit reports of local governments that report on a non-GAAP financial reporting framework as provided in A.R.M. 2.4.401 must include any Supplementary Information and Other Information required in that administrative rule.
15. Written Report to Entity: The Contractor shall render a single, written report for the Entity audited, including the reports and schedules referenced in paragraphs 11 through 14 above. 16. Exit Conference: Before submitting the final audit report, the Contractor shall hold an exit review
conference in which the audit results are discussed with those charged with governance and other
appropriate Entity officials and employees. The Contractor shall ensure that all members of the governing body and key members of management are notified of this exit conference. The Contractor further agrees that before the exit conference, it will not discuss the audit findings with anyone other than the Entity or the State. Once the Contractor delivers the final audit report to the Entity, the report is deemed to be a public
record.
17. Report Distribution: The Contractor and Entity shall file copies of the audit report as specified below: A. The Contractor shall provide the Entity with the number of copies of the audit report specified in
Appendices A, B and C. The cost of those copies is included in the total price for the engagement as
set out in paragraph 2.A., above, and in the Appendices. B. The Contractor shall submit one of the copies referred to in 17.A., above, to the attorney for the Entity.
C. Upon request by the Entity, the Contractor shall provide additional copies of the audit report at a price
per copy agreed upon by the Entity and Contractor.
D. The Contractor shall provide the State with a text-searchable, unlocked, and unencrypted electronic copy of the audit report at no charge. The report must be submitted to the State at the same time when
the Contractor delivers the final audit report to the Entity. Any report delivered separately to
management or those charged with governance identifying findings and recommendations as described in 11.C. above must be submitted electronically at the same time the audit report is submitted. The Contractor shall advise the State, at the time of submitting the electronic report, of the date the final report was delivered to the Entity, the date of the audit report, the actual number of hours
the Contractor spent conducting the audit, the total audit fee billed the Entity, and whether the audit
was conducted in accordance with the provisions of Uniform Guidance.
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E. If the Entity is a school district or associated cooperative, the Contractor shall provide at no additional
charge copies of the audit report to the Office of Public Instruction, the county superintendent of
schools, and the county attorney. F. If the Entity is a city or town fire department relief association disability and pension fund, the Contractor shall provide at no additional charge one copy of the audit report to the city or town clerk.
G. If the audit is a single audit conducted in accordance with the provisions of Uniform Guidance, the Entity shall provide copies of the reporting package defined in Uniform Guidance and the data collection form to the federal clearinghouse designated by OMB.
18. Entity Response: If not included in the audit report as provided in paragraphs 11.F. and 12.E., within 30 days after receiving the audit report, the Entity shall notify the State in writing as to what action it plans to take to correct any deficiencies or implement any recommendations identified or contained in the audit report as required by Section 2-7-515, MCA, and ARM 2.4.409. This notification must also address any
findings and recommendations identified in any report to management or those charged with governance
described in 11.C. above. If the audit is a single audit conducted in accordance with Uniform Guidance, this corrective action plan must also meet the requirements of Uniform Guidance. If the Entity is a school district or special education cooperative, the Entity shall also send a copy of this notification to the Office of Public Instruction.
19. Entity’s Attorney: If requested by the State, the attorney for the Entity shall report to the State on the actions taken or the proceedings instituted or to be instituted relating to violations of law and nonperformance of duty as required by Section 2-7-515(4), MCA. The attorney shall report to the State within 30 days after receiving the request.
20. Certification of Auditor Independence: The Contractor certifies that, as required by generally accepted government auditing standards, it and its principals and employees are independent in all matters regarding this engagement. This contract must not include non-audit services. The Contractor shall neither arrange for nor accept other work with the Entity that could in any way impair the Contractor's compliance with
professional independence standards. If required by the State, the Contractor shall provide documentation
that independence has been maintained in both mind and appearance as required by professional auditing standards. 21. Contractor and Subcontractors: The Contractor shall not assign any rights, or subcontract or delegate any
duties of the contract without the Entity’s and State’s prior written consent.
The Contractor is the prime contractor and is responsible, in total, for all work of any subcontractors. Any subcontractors performing audit work shall be on the Roster of Independent Auditors authorized to conduct audits of Montana local governments that is maintained by the State. The Contractor is responsible to the
Entity and the State for the acts and omissions of all subcontractors or agents and of persons directly or
indirectly employed by such subcontractors or agents. There is no contractual relationship between any subcontractor and the State. 22 State Participation in Conferences: The State may participate in all entrance and exit conferences between
the Entity and Contractor, as well as all major conferences held in conjunction with the audit of the Entity.
23. Access to Records: The Contractor shall give the State and, when required by law, the Montana Legislative Audit Division, access to the Contractor's work programs, supporting working papers, time records, and all other documents relating to the audit. Access to these documents must be provided at the State's offices in
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Helena, Montana. Access to working papers includes the right of the State to obtain copies of working
papers, as is reasonable and necessary. The Contractor shall make the work programs and supporting
working papers available to the State for use by the State or other public accounting firms as directed by the State in future audits of the Entity. The Contractor shall make the audit programs and supporting working papers available to the cognizant or oversight agency for audit or its designee, federal agencies providing direct or indirect funding, or the U.S. General Accounting Office, if requested. Access to working papers
includes the right of federal agencies to obtain copies of working papers, as is reasonable and necessary.
The Contractor shall retain the audit report, work programs, and supporting working papers for a minimum of five years from the date of the audit report, unless the State notifies the Contractor to extend the retention period. If professional standards or other applicable laws, rules, or regulations require a longer retention period, the Contractor shall retain the above materials for that specified period.
24. State Review of Report: As provided by Section 2-7-522, MCA, the State shall review the Contractor’s audit report. If the State determines that reporting requirements have not been met, it will notify the Entity and the Contractor of the significant issues of noncompliance. The Contractor shall correct the identified deficiencies within 60 days of notification.
25. Independent Contractor: The Contractor is an independent contractor and neither its principals nor its employees are employees of the State or Entity for any purposes. 26. Workers’ Compensation: The Contractor certifies that it carries Workers’ Compensation for its employees
and that it has either elected Workers’ Compensation or has an approved Independent Contractor’s
Exemption covering the Contractor while performing work under this contract. (Montana Code Annotated, Title 39, Chapter 71). 27. Indemnity: The Contractor shall defend and indemnify the State and Entity, their elected and appointed
officials, agents, and employees from and against all claims, causes of action, damages, liabilities, court
costs and attorney fees in favor of the Contractor’s employees or third parties for bodily or personal injuries, death, or damage to property arising from the acts or omissions or alleged acts or omissions of the Contractor and/or its agents, employees, representatives, assigns, subcontractors under this contract. This defense and indemnify obligation does not apply to acts or omissions arising from the sole negligence of the State or
Entity under this contract. This defense and indemnity obligation survives termination or expiration of this
contract. If the Contractor is or may be obligated to pay any cost, settlement, judgment, fine, penalty, or similar award or sanction as a result of a claim, investigation, or other proceeding instituted by any third party, then to the
extent that such obligation is or may be a direct or indirect result of the Entity’s intentional or knowing
misrepresentation or provision to the Contractor of inaccurate or incomplete information in connection with this engagement, and not any failure on the Contractor’s part to comply with professional standards, the Entity shall defend and indemnify the Contractor against such obligations.
28. Insurance – Commercial General Liability: The Contractor shall maintain for the duration of the
contract, at its cost and expense, occurrence coverage insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work by the Contractor, and/or its agents, employees, representatives, assigns, or subcontractors. The Contractor's insurance coverage shall be primary insurance for the Contractor’s negligence with respect to the State and
Entity and their elected officers, officials, employees, and volunteers. Any insurance or self-insurance
maintained by the State and Entity and their officers, officials, employees or volunteers shall be excess of the Contractor's insurance and shall not contribute with it.
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Insurance - Professional Liability: The Contractor shall purchase and maintain occurrence coverage to
cover such claims as may be caused by any act, omission, negligence of the Contractor or its officers, agents,
representatives, assigns or subcontractors.
If occurrence coverage is unavailable or cost-prohibitive, the state will accept ‘claims made’ coverage provided the following conditions are met: 1) the commencement date of the contract must not fall outside
the effective date of insurance coverage and it will be the retroactive date for insurance coverage in future
years, and 2) the claims made policy must have a three-year tail for claims that are made (filed) after the cancellation or expiration date of the policy. The State and Entity may require complete copies of certificates of insurance during the term of this contract.
29. Compliance with Laws: A. The Contractor shall, in performance of work under this contract, fully comply with all applicable federal, state, or local laws, rules, regulations, and executive orders including but not limited to, the Montana Human Rights Act, the Equal Pay Act of 1963, the Civil Rights Act of 1964, the Age
Discrimination Act of 1975, the Americans with Disabilities Act of 1990, and Section 504 of the
Rehabilitation Act of 1973. The Contractor is the employer for the purpose of providing healthcare benefits and paying any applicable penalties, fees and taxes under the Patient Protection and Affordable Care Act [P.l. 111-148, 124 Stat. 119]. Any subcontracting by the Contractor subjects subcontractors to the same provisions.
B. In accordance with 49-3-207, MCA, and Executive Order No. 04-2016 the Contractor agrees that the hiring of persons to perform this contract will be made on the basis of merit and qualifications and there will be no discrimination based on race, color, sex, pregnancy, childbirth or medical conditions related to pregnancy or childbirth, political or religious affiliation or ideas, culture, creed, social
origin or condition, genetic information, sexual orientation, gender identity or expression, national
origin, ancestry, age, disability, military service or veteran status, or marital status by the persons performing this contract. 30. Work Accommodations: The Entity shall provide the Contractor with reasonable space in which to conduct
the audit and shall respond promptly to requests for information as well as for all necessary books and
records. Support for clerical, equipment, reproduction services shall be agreed upon by the Entity and the Contractor as specified in Appendices A, B and C. 31. Termination before Audit Commences: Before the commencement of the audit, either the Contractor or
the Entity, with the State’s consent, or the State alone, may terminate this contract for cause if another party
has breached a material term or condition of this contract or violated an applicable law or regulation. The non-breaching party shall provide the other party written notice of the breach and allow 20 days to remedy the breach.
The Contractor and the Entity may agree to terminate this contract without cause before the commencement
of the audit. If such a termination occurs, the State shall consent to the termination upon written notification by the Contractor and the Entity of their agreement to terminate this contract. The State, however, will not consent to the cancellation of an audit contract for the sole purpose of allowing
the Contractor and Entity to then enter into a new contract that extends the number of fiscal years to be
audited by the Contractor. Unless there are extenuating circumstances, the existing audit contract must be completed first. This provision does not prohibit the cancellation of a contract for the purpose of replacing an annual audit with a biennial audit.
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32. Termination after Audit Commences: After the audit has commenced, but before the audit report has been
issued, either the Contractor or the Entity, with the State’s consent, or the State alone, may terminate this
contract for cause if another party has breached a material term or condition of this contract or violated an applicable law or regulation. The non-breaching party shall provide the other party written notice of the breach and allow 20 days to remedy the breach. If the Contractor is the breaching party and fails to remedy the breach, the Contractor is not entitled to the fee set out in this contract. This is the Entity’s and the State’s
sole remedy. If the Entity is the breaching party, the Entity shall pay the Contractor a pro rata portion of
the fee set out in this contract, based on the percentage of work completed at the time of termination. This is the Contractor’s sole remedy. The Contractor and the Entity may agree to terminate this contract without cause after the audit has
commenced but before the audit report has been issued. If such a termination occurs, the State shall consent
to the termination upon written notification by the Contractor and the Entity of their agreement to terminate this contract. 33. Contractor Compliance with CPE and Quality Control Review: The Contractor certifies compliance
with the continuing professional education requirements and the external quality control review
requirements as set out in Government Auditing Standards, as established by the Comptroller General of the United States. The State may require the Contractor to provide evidence that it has met the above requirements.
34. Single Audit Act Certification: If the audit is required to meet the requirements of the Single Audit Act of
1984, as amended, and Uniform Guidance, the Contractor certifies that neither it nor any of its principals is presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from performing audits by any Federal department or agency.
35. Time is of the Essence: Time is of the essence regarding all provisions of this contract.
36. Governing Law and Venue: This contract is governed by the laws of Montana. The parties agree that any litigation concerning this contract in which the State is named as a party must be brought in the First Judicial District in and for the County of Lewis and Clark, State of Montana. Each party shall pay its own costs and
attorney fees, except as otherwise allowed in this contract. The parties also agree that any litigation
concerning this contract in which the State is not named as a party must be brought in the State of Montana Judicial District in the County in which the Entity is located. Each party shall pay its own costs and attorney fees, except as otherwise allowed in this contract.
37. Notice: All notices under this contract must be in writing and will be deemed given if delivered personally,
by mail, certified, return receipt requested, or by e-mail. All notices will (a) if delivered personally, be deemed given upon delivery, (b) if delivered by mail, be deemed given upon receipt, or (c) if delivered by e-mail be deemed given upon receipt.
38. Invalid Provision: If any provision of this contract is held to be illegal or unenforceable and the parties’
rights or obligations will not be materially and adversely affected, such provision will be (a) severed from the contract, (b) the contract will be interpreted as if such provision was never a part of the contract and (c) the remaining provisions will stay in effect.
39. Authority: Each party represents that the person signing this contract has the authority to bind that party.
40. Entire Agreement and Amendment: This contract and the attached Appendices contain the entire understanding and agreement of the parties. No modification or amendment of this contract is valid unless it is reduced to writing, signed by the parties, and made a part of this contract.
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Contractor, Entity, and State have executed this Standard Audit Contract on the date first above written:
Certified Public Accountant
Firm Name By: Date: Authorized Representative
Governmental Entity Entity Name
By: Date: Authorized Representative Montana Department of Administration, Local Government Services By: Date: Approved By
AuditContract.11-2020 Page A1 11/2020
APPENDIX A
Initial or Sole Audit under this Contract
GOVERNMENTAL ENTITY (ENTITY):
Address: Telephone: (Street Address or P.O. Box)
, MT 59 (City/Town) (Zip Code)
Contact Person(s) and E-Mail Address(es)
PUBLIC ACCOUNTANT/ACCOUNTING
FIRM (CONTRACTOR) :
Address: Telephone: (Street Address or P.O. Box)
, MT 59 (City/Town) (Zip Code)
Contact Person(s) and E-Mail Address(es)
1. Audit Period and Dates of Engagement:
A. This audit will cover the fiscal year(s) ending , (and ).
(Month & Day) (Year) (Year) B. Date to commence audit work: C. Date to submit final audit report to Entity and State: 2. Time and Price for Engagement: A. Estimated total hours -
B. Price for audit personnel $ Price for Travel
Price for typing, clerical and report preparation Total price for this
engagement $ 3. The reporting entity contains the following discretely presented component units: 4. Date Annual Financial Report or a trial balance will be available:
AuditContract.11-2020 Page A2 11/2020
5. Number of copies of audit report Contractor will provide to Entity: __
6. The Entity will provide clerical, equipment, and photocopying or reproduction services to the
Contractor as follows:
7. The audit scope with regard to federal financial assistance received by the Entity for the above fiscal year(s) will be as indicated below:
The audit will be a single audit conducted in accordance with the provisions of Uniform Guidance because the
Entity expended a total amount of federal awards equal to or in excess of $750,000 during the fiscal year(s), or such other dollar amount ($____________) that is effective for the fiscal year(s) being audited. OR
The audit will not be a single audit conducted in accordance with the provisions of Uniform
Guidance and will not include audit coverage of any federal financial assistance in accordance with
requirements of that federal regulation, because the Entity expended a total amount of federal
awards of less than $750,000 during the fiscal year(s), or such other dollar amount
($____________) that is effective for the fiscal year(s) being audited.
Certified Public Accountant
Firm Name
By: Date: Authorized Representative
Governmental Entity Entity Name By: Date: Authorized Representative Montana Department of Administration, Local Government Services By: Date: Approved By
AuditContract.11-2020 Page B1 11/2020
APPENDIX B
Subsequent Audit under this Contract
GOVERNMENTAL ENTITY (ENTITY):
Address: Telephone: (Street Address or P.O. Box)
, MT 59 (City/Town) (Zip Code)
Contact Person(s) and E-Mail Address(es)
PUBLIC ACCOUNTANT/ACCOUNTING
FIRM (CONTRACTOR):
Address: Telephone: (Street Address or P.O. Box)
, MT 59 (City/Town) (Zip Code)
Contact Person(s) and E-Mail Address(es)
1. Audit Period and Dates of Engagement:
A. This audit will cover the fiscal year(s) ending , (and ).
(Month & Day) (Year) (Year) B. Date to commence audit work: C. Date to submit final audit report to Entity and State: 2. Time and Price for Engagement: A. Estimated total hours -
B. Price for audit personnel $ Price for Travel
Price for typing, clerical and report preparation Total price for this
engagement $ 3. The reporting entity contains the following discretely presented component units: 4. Date Annual Financial Report or a trial balance will be available:
AuditContract.11-2020 Page B2 11/2020
5. Number of copies of audit report Contractor will provide to Entity: __
6. The Entity will provide clerical, equipment, and photocopying or reproduction services to the
Contractor as follows:
7. The audit scope with regard to federal financial assistance received by the Entity for the above fiscal
year(s) will be as indicated below:
The audit will be a single audit conducted in accordance with the provisions of Uniform Guidance because the
Entity expended a total amount of federal awards equal to or in excess of $750,000 during the fiscal year(s), or such other dollar amount ($____________) that is effective for the fiscal year(s) being audited. OR
The audit will not be a single audit conducted in accordance with the provisions of Uniform
Guidance and will not include audit coverage of any federal financial assistance in accordance with
requirements of that federal regulation, because the Entity expended a total amount of federal
awards of less than $750,000 during the fiscal year(s), or such other dollar amount
($____________) that is effective for the fiscal year(s) being audited.
Certified Public Accountant
Firm Name By: Date: Authorized Representative Governmental Entity
Entity Name
By: Date: Authorized Representative
Montana Department of Administration, Local Government Services
By: Date:
Approved By
APPENDIX C
Subsequent Audit under this Contract
GOVERNMENTAL ENTITY (ENTITY):
Address: Telephone: (Street Address or P.O. Box)
, MT 59 (City/Town) (Zip Code)
Contact Person(s) and E-Mail Address(es)
PUBLIC ACCOUNTANT/ACCOUNTING FIRM (CONTRACTOR):
Address: Telephone: (Street Address or P.O. Box)
, MT 59 (City/Town) (Zip Code)
Contact Person(s) and E-Mail Address(es)
1. Audit Period and Dates of Engagement:
A. This audit will cover the fiscal year(s) ending , (and ).
(Month & Day) (Year) (Year) B. Date to commence audit work:
C. Date to submit final audit report to Entity and State:
2. Time and Price for Engagement: A. Estimated total hours -
B. Price for audit personnel $ Price for Travel Price for typing, clerical and report preparation Total price for this engagement $
3. The reporting entity contains the following discretely presented component
units:
4. Date Annual Financial Report or a trial balance will be available: 5. Number of copies of audit report Contractor will provide to Entity: __
6. The Entity will provide clerical, equipment, and photocopying or reproduction services to the Contractor as follows: 7. The audit scope with regard to federal financial assistance received by the Entity for the above fiscal year(s) will be as indicated below:
The audit will be a single audit conducted in accordance with the provisions of Uniform
Guidance because the Entity expended a total amount of federal awards equal to or in excess of $750,000 during the fiscal year(s), or such other dollar amount ($____________) that is effective for the fiscal year(s) being audited. OR
The audit will not be a single audit conducted in accordance with the provisions of
Uniform Guidance and will not include audit coverage of any federal financial
assistance in accordance with requirements of that federal regulation, because the
Entity expended a total amount of federal awards of less than $750,000 during the
fiscal year(s), or such other dollar amount ($____________) that is effective for the
fiscal year(s) being audited.
Certified Public Accountant Firm Name
By: Date:
Authorized Representative
Governmental Entity
Entity Name By: Date: Authorized Representative Montana Department of Administration, Local Government Services
By: Date: Approved By