Sedgwick County may choose a new auditor – at a cost of $91,000 more

Sedgwick County’s bid board is recommending a new, more costly, firm to audit its financial statements at the urging of County Manager Michael Scholes.

“I would like to see a fresh perspective, a fresh look, a fresh process,” Scholes told bid board members in a public meeting last week. “That, to me, outweighs somebody who’s been doing it for a long time.”

Bid board members voted 4-0 on Thursday to recommend that the county spend $776,009 to contract with BKD, LLP, for auditing services. County commissioners are scheduled to vote on the contract Wednesday.

A review committee of staff members, mainly from the finance department, had recommended the county contract again with current auditor Allen, Gibbs & Houlik, LC, for $685,202.

BKD’s bid was about $91,000 more than the bid submitted by Allen, Gibbs & Houlik.

Allen, Gibbs & Houlik, or AGH, provided the best overall proposal for auditing services based on cost and thoroughness, said purchasing agent Kara Kingsley in a presentation on the staff recommendation.

“AGH has provided auditing services for Sedgwick County for many years and has the experience and expertise of working with public sector entities the same size as the county,” Kingsley said. “AGH will offer a smoother auditing process based on their history and knowledge of Sedgwick County practices and policies.”

“BKD also is a qualified firm … but their pricing was higher over the life of the contract,” Kingsley added.

She said the staff committee considered rotating to a new auditor because that’s considered a best practice in the financial industry.

“But it was concluded that AGH offered enough employee diversification that would satisfy any concerns,” she said.

Scholes called the new firm the “logical choice.” He said “fresh procedure” far outweighed the higher price tag.

“If you could give deference, don’t focus on cost,” Scholes said. “We’ve had a great relationship with AGH. They have done nothing wrong. But in light of recent events, I would like a fresh perspective.”

The county lost more than $566,000 to fraud in October.

Treasurer Linda Kizzire, who is on the bid board, agreed.

“It’d be nice to have a different set of eyes viewing instead of just always the same standard eyes, type of procedures and checks,” she said.

The bid board also recommended the county contract with BKD for a separate audit that examines the county’s internal financial policies and vulnerability to fraud. Unlike the full auditing services request, that vote matched the initial recommendation of county staff.

Scholes said Friday that he felt the need to tell the bid board the value in “getting somebody different.” He added that rotating auditors was the best financial practice. Scholes said he had been told auditors should be rotated every seven years.

He also said the county’s recent loss to fraud prompted some self-reflection.

“That opened our eyes and caused us to go, ‘Hey, is there something we can do better?’ ” Scholes said.

This story was originally published December 10, 2016 at 5:09 PM with the headline "Sedgwick County may choose a new auditor – at a cost of $91,000 more."