Report 2017-113 Recommendation 9 Responses

Report 2017-113: South Orange County Wastewater Authority: It Should Continue to Improve Its Accounting of Member Agencies' Funds and Determine Whether Members Are Responsible for Its Unfunded Liabilities (Release Date: March 2018)

Recommendation #9 To: South Orange County Wastewater Authority

To reduce future audit costs, SOCWA should amend its policy on professional service procurements to specify that it should enter into agreements of at least five years with its competitively procured external audit firms. It should also develop a policy to rotate its external auditor when state law requires.

60-Day Agency Response

The SOCWA Board of Directors passed Resolution No. 2018-03: Adopting External Auditor Policy. The Board reviewed the recommendation of the State Auditor's Report and folded in the recommendation to adopt a policy defining the practice of rotation of auditing firms. The Board supported rotation of Auditors and agreed in the Policy to consider appointment for up to 5-year period noting that contract duration may be set with multi-year renewal based on qualifications, experience, and overall satisfaction with performance. Agency counsel is directed by the policy to recommend revisions based on changes in law or recommended standards.

California State Auditor's Assessment of 60-Day Status: Resolved

All Recommendations in 2017-113

Agency responses received are posted verbatim.