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Elk River <br /> Municipal Utilities UTILITIES COMMISSION MEETING <br /> TO: FROM: <br /> Elk River Municipal Utilities Commission Theresa Slominski—Finance & Office <br /> John Dietz—Chair Manager <br /> Al Nadeau—Vice Chair <br /> Daryl Thompson—Trustee <br /> MEETING DATE: AGENDA ITEM NUMBER: <br /> November 15, 2016 4.2 <br /> SUBJECT: <br /> RFP Auditing Firm <br /> BACKGROUND: <br /> Last month we presented the results of the Auditing Firm RFP and our recommendation for <br /> moving forward with the current firm of Abdo, Eick, and Meyers LLP (AEM). Keeping the <br /> current auditors would be a cost neutral move for 2016, and an approximate $3,500 increase for <br /> each of the remaining four years. Staff was tasked to bring back recommendations for cost <br /> reductions of approximately $3,500 to offset the cost of retaining the current auditors in <br /> accepting the AEM proposal from the RFP. <br /> DISCUSSION: <br /> For reference,the Utility rationale for keeping the current auditors is largely dependent on the <br /> current transactions that we are invested in (the MMPA buy-in, the territory acquisition, and the <br /> sale of the security division), which our current auditors have been very involved in helping us <br /> plan for the implementation of these transactions and the financial reporting of them. <br /> In reviewing forecasted expenses for potential savings there is a notable decrease in expenses for <br /> our MMTG fees. Current and prior years have been approximately $12,000 and that is being <br /> reduced to $5,900, a savings of$6,100 annually. In addition, as alluded to last month, we will be <br /> receiving an increase in the revenue received through the MISO reporting with the recognition of <br /> 50% of our transformers as qualifying assets. This is projected to be approximately $154,095 <br /> per year starting in 2018. Both of these items would be sufficient to offset the $3,500 RFP <br /> increase. <br /> ACTION REQUESTED: <br /> Approve the staff recommendation of retaining the existing auditors for the next five years. <br /> ATTACHMENTS: <br /> • 2016 Audit Proposals Pricing <br /> • October 11, 2016 RFP Auditing Firm Memo <br /> FN—ATURil <br /> OWERED 0 <br /> Page 1 of 1 <br /> Reliable P13111C <br /> Power Provider P o.4 E a E o To SERVE <br /> Al <br />