Appointing auditors to go over a municipality’s books is usually a pretty routine decision.
However, it proved an eye-opening experience for Red Deer County council on Tuesday. Only two bids were received, including one from a U.S.-based accounting firm that had never done any municipal auditing work.
Well-known company MNP LLP, which has audited the county’s books for the past 10 years, was the other bidder. Its rate was $37,500 in each of the next three years, up from $27,000 a year under the previous agreement.
Mayor Jim Wood voiced reservations about the lack of bidders and the cost.
“I’m concerned with the price increase I see,” said Wood, who wondered if the county would be better off re-tendering in hopes of getting more competitive bids.
“I just feel with these kinds of price increases and only two applying we may be paying more than we need to. I’m tempted to re-tender.”
County corporate services director Heather Surkan said about half a dozen companies looked at the county’s request for proposals, which was posted on the county’s website and linked to the Alberta Purchasing Connection.
Coun. Connie Huelsman said she was “shocked” that the county’s auditing contract drew so little interest.
“It doesn’t surprise me that (the price) has gone up a little bit. It does surprise me that there were so few contenders.”
Given that a number of companies had looked at the contract and passed, Coun. Dana Depalme doubted re-tendering was worthwhile.
“Re-tendering is not going to change anything.”
Council voted 5-2 to award a five-year $189,000 contract to MNP. Wood and Coun. Brent Ramsay voted against.
Rural Municipalities of Alberta (RMA) president Paul McLauchlin said he had not heard of other municipalities running into auditing challenges but he was going to continue to monitor the situation.
The RMA represents 69 Alberta counties and municipal districts.