HomeMy WebLinkAboutAgenda - 02-21-2023; 8-e - North Carolina Local Government Commission Contract Amendment #2 1
ORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: February 21, 2023
Action Agenda
Item No. 8-e
SUBJECT: North Carolina Local Government Commission Contract Amendment #2
DEPARTMENT: Finance and Administrative Services
ATTACHMENT(S): INFORMATION CONTACT:
1. Local Government Commission Gary Donaldson, (919) 245-2453
Contract Amendment #2
PURPOSE: To amend the contract with the North Carolina Local Government Commission (LGC)
for the County's audit to modifiy of the audit fee to reflect additional audit hours required to
complete the audit and the Local Government Employer Retirement System (LGERS)
examination.
BACKGROUND: The North Carolina Local Government Commission (LGC) requires that all local
governments receive approval for contracts and amendments. The auditors submitted an initial
contract amendment approved at the Board's December 13, 2022 Business meeting which
reflected the two additional programs being audited and the commensurate amount of $15,000
(the increase from $96,000 to $111,000).
Staff was notified by the State after the adoption of the FY 2022-23 Budget that the County was
selected for the LGERS examination.
This second contract amendment in the amount of $41,500 reflects the additional hours required
to complete the audit and the cost of the Local Government Employer Retirement System
(LGERS) examination.
FINANCIAL IMPACT: The additional contract amounts of $56,500 is fully offset by excess
interest income that the County has received in FY 2022-23 and reported in the second quarter
financial report. The funding is included Budget Amendment #6 on this same meeting agenda.
SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goal is applicable to
this item:
• GOAL: ENSURE ECONOMIC SELF-SUFFICIENCY
The creation and preservation of infrastructure, policies, programs and funding necessary
for residents to provide shelter, food, clothing and medical care for themselves and their
dependents.
ENVIRONMENTAL IMPACT: There is no Orange County Environmental Responsibility Goal
impact with approval of this action.
RECOMMENDATION(S): The Manager recommends that the Board approve and authorize the
Chair to sign the attached LGC Contract Amendment #2.
2
LGC-205 Amendment AMENDMENT TO CONTRACT TO AUDIT ACCOUNTS Rev. 11/2022
Whereas Primary Government Unit
Orange County,North Carolina
and Discretely Presented Component Unit(DPCU) (if applicable)
and Auditor
Mauldin&Jenkins, LLC
entered into a contract in which the Auditor agreed to audit the accounts of the Primary Government Unit
and DPCU (if applicable)
Fiscal Year Ending Date
for and originally to be
06/30/22 submitted to the LGC on 10/31/22
hereby agree that it is now necessary that the contract be modified as follows.
Original date Modified date
❑✓ Modification to date submitted to LGC 10/31/22 01/18/23
Original fee Modified fee
❑✓ Modification to fee $ 96,000.00 $ 141,000.00
Primary Other Reason(s)for Contract Amendment
(choose 1)(choose 0-2)
E) ❑ Change in scope
0 0 Issue with unit staff/turnover
0 ❑ Issue with auditor staff/workload
0 ❑ Third-party financial statements not prepared by agreed-upon date
0 ❑ Unit did not have bank reconciliations complete for the audit period
0 ❑✓ Unit did not have reconciliations between subsidiary ledgers and general ledger complete
0 ❑ Unit did not post previous years adjusting journal entries resulting in incorrect beginning
balances in the general ledger
0 ❑ Unit did not have information required for audit complete by the agreed-upon time
0 ❑ Delay in component unit reports
0 ❑ Software - implementation issue
0 ❑ Software -system failure
0 ❑ Software - ransomware/cyberattack
0 ❑ Natural or other disaster
0 ❑ Other (please explain)
Plan to Prevent Future Late Submissions
If the amendment is submitted to modify the date the audit will be submitted to the LGC, please indicate the steps the unit and
auditor will take to prevent late filing of audits in subsequent years.Audits are due to the LGC four months after fiscal year end.
Indicate NA if this is an amendment due to a change in cost only.
The County and the audit firm have discussed changes to the audit process for June 30,2023 including:(1)the County is filling an
accounting manager position;(2)if an accounting manager is not able to be hired,the County will retain additional accounting support to
assist with close out and audit prep;and(3)detailed weekly status check-in throughout the entire duration of the audit.
Additional Information
Please provide any additional explanation or details regarding the contract modification.
Modification to the audit fee is being made to address both the change in scope (additional federal/state programs
that were required to be audited as major) as well as cost overruns resulting from additional hours to address
audit adjustments.
By their signatures on the following pages, the Auditor, the Primary Government Unit, and the DPCU (if
applicable), agree to these modified terms.
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LGC-205 Amended AMENDMENT TO CONTRACT TO AUDIT ACCOUNTS Rev. 11/2022
SIGNATURE PAGE
AUDIT FIRM
Audit Firm*
Mauldin&Jenkins, LLC
Authorized Firm Representative* (typed or printed) Signature*
Timothy M. Lyons %G{�W.
Date* Email Address
01/24/23 tlyons@mjcpa.com
GOVERNMENTAL UNIT
Governmental Unit*
Orange County,North Carolina
Date Primary Government Unit Governing Board Approved Amended
Audit Contract* (If required by governing board policy)
Mayor/Chairperson* (typed or printed) Signature*
Date Email Address
Chair of Audit Committee (typed or printed,or"NA") Signature
Date Email Address
GOVERNMENTAL UNIT— PRE-AUDIT CERTIFICATE
*ONLY REQUIRED IF FEES ARE MODIFIED IN THE AMENDED CONTRACT*
(Pre-audit certificate not required for hospitals)
Required by G.S. 159-28(al) or G.S. 115C-441(al)
This instrument has been pre-audited in the manner required by The Local Government
Budget and Fiscal Control Act or by the School Budget and Fiscal Control Act.
Primary Governmental Unit Finance Officer* Signature*
Date of Pre-Audit Certificate* Email Address*
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LGC-205 Amended AMENDMENT TO CONTRACT TO AUDIT ACCOUNTS Rev. 11/2022
SIGNATURE PAGE — DPCU
(complete only if applicable)
DISCRETELY PRESENTED COMPONENT UNIT
DPCU
Date DPCU Governing Board Approved Amended Audit
Contract (If required by governing board policy)
DPCU Chairperson (typed or printed) Signature
Date Email Address
Chair of Audit Committee (typed or panted,or"NA") Signature
Date Email Address
DPCU — PRE-AUDIT CERTIFICATE
*ONLY REQUIRED IF FEES ARE MODIFIED IN THE AMENDED CONTRACT*
(Pre-audit certificate not required for hospitals)
Required by G.S. 159-28(al) or G.S. 115C-441(al)
This instrument has been pre-audited in the manner required by The Local Government
Budget and Fiscal Control Act or by the School Budget and Fiscal Control Act.
DPCU Finance Officer (typed or printed) Signature
Date of Pre-Audit Certificate Email Address
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