UNIVERSITY OF ALASKA FAIRBANKS Procurement & Contract Services

E-Solicitation Cover Page

REQUEST FOR PROPOSALS (RFP) NO. 13P0005SRS TITLE OF SOLICITATION:

Professional Accounting Services – External Auditor The University of Alaska is requesting proposals from qualified companies (Offerors) of certified public accountants to audit its financial statements and to perform other professional services described in this solicitation.

EMAIL OR DELIVER PROPOSALS For Physical Delivery of electronic media:

University of Alaska Fairbanks Procurement & Contract Services 3295 College Road, Suite 103 Fairbanks, Alaska 99709

By Email to: srschwafel@alaska.edu

SUBMITTAL DEADLINE PROPOSALS MUST BE RECEIVED

NO LATER THAN: October 1, 2012

3:00 PM Alaska Time (FAXED, PRINTED OR LATE PROPOSALS

WILL NOT BE ACCEPTED) PRE-PROPOSAL CONFERENCE

None scheduled at this time. DEADLINE FOR SUBMISSION OF QUESTIONS: September 18, 2012

RFP ISSUE DATE

August 31, 2012

NOTE: Faxed or telegraphed proposals, or proposals submitted by any means other than described in this announcement will not be accepted and will be rejected as non-responsive.

NOTICE TO OFFERORS

ONLY POINT OF CONTACT FOR RFP INQUIRIES: Stanley R. Schwafel, Senior Contracting Officer

Email: srschwafel@alaska.edu Telephone: ( 907) 474-7420

Fax: (907) 474-7720

The person listed above is the only point of contact for inquiries regarding any aspect of this RFP or its requirements. Offerors who seek or receive information regarding this solicitation from any other University official may be declared non-responsive and removed from further consideration. A copy of this solicitation, supporting documents, and any amendments, if issued, may be accessed from the UAF Procurement & Contract Services Website at the following starting link: http://www.uaf.edu/procurement/community/solicitations/ .

AVAILABILITY OF FUNDING Any contract resulting from this RFP will only be issued subject to the availability of funding. The funding source allows or does not allow application of Alaska preference laws.

PROCUREMENT OFFICER Stanley R. Schwafel Senior Contracting Officer

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Electronic Signature Page

By signing this document, Offeror is attesting to its understanding, agreement and compliance with all forms and documents indicated with an “X”, below. Any exceptions shall be explained on the Statement of Compliance Form. Failure to provide the required completed documents in the manner requested may result in the proposal being declared non-responsive. The following reference documents are integral to this solicitation and, where applicable, are legally binding.

Solicitation Support Documents & Checklist of Required Submittals (links)

Reference documents Required forms

Instructions to Offerors Proposal Transmittal Form Professional Services Contract & GPs Electronic Signature Page Insurance statement (revised) Statement of Compliance Form Exhibits 1 – 3 for reference Representations, Certifications & etc.

Rate Response Forms

Instructions: The documents listed above are linked to a website for access, download and review. Complete all forms, where required, and submit them as described below. If there are questions regarding format, please contact the responsible procurement officer listed on the cover page.

Organize proposal documents as follows: Prepare, save, and submit the proposal as two Adobe PDF files: one PDF file containing the Technical Proposal (narrative) together with all required forms and other documents, and a second PDF file containing the Rate Response Form and any rate/price related supporting information.

Proposal Transmittal

Form

Statement of Compliance

Form

Electronic Signature

Page

OTHER REQUIRED DOCUMENTS

PART A (submit one pdf)REQUIRED FORMS TO BE SUBMITTED

PART B (submit a second pdf)

Representations, Certifications &

Statement of Bidders/Offerors

Form

State of Alaska Business Licenseis REQUIRED at

the time of proposal

submission

TECHNICAL PROPOSAL

RATE RESPONSE

FORM

Proposals will be accepted ONLY in PDF format on the following media: USB Flash Memory CD or DVD by E-mail attachment to: srschwafel@alaska.edu

Please list the company name and the name and signature of the person

authorized to legally bind the offeror:

Company Name Preparer’s Name and title (print or type) Date

Preparer’s signature:

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UNIVERSITY OF ALASKA FAIRBANKS REQUEST FOR PROPOSALS

NO. 13P0005SRS for

PROFESSIONAL ACCOUNTING SERVICES: EXTERNAL AUDITOR

TABLE OF CONTENTS

Cover Page ........................................................................................................... 1 Electronic Signature Page ................................................................................... 2 Table of Contents ................................................................................................ 3

I. ELECTRONIC PROPOSAL SYSTEM

A. Electronic Submittal Procedure .................................................................... 5 B. Electronic version of RFP .............................................................................. 5

II. PURPOSE OF SOLICITATION AND GENERAL INFORMATION

A. Purpose of Solicitation ...................................................................................6 B. General Information ......................................................................................6 C. Faxed Proposals Shall Not Be Accepted ........................................................ 7 D. Basis of Award – Best Value .......................................................................... 7 E. Inquiries/Questions Received Prior to the Deadline for Proposals ............. 7 F. UA Intends to Evaluate Proposals and Award a Contract ........................... 8 G. Contract Type and Kind ................................................................................ 8 H. Contract Term/Period of Performance ........................................................ 8 I. Period of Acceptance of Proposals ................................................................9 J. Approval of Contractor Personnel .................................................................9 K. Modifications to Contract ..............................................................................9 L. Contract Administrator(s) .............................................................................9 M. Contract Contents ..........................................................................................9 N. Proprietary Information ................................................................................9 O. Confidentiality ............................................................................................. 10 P. Documents and Data provided by the University ....................................... 10

III. STATEMENT OF SERVICES AND REQUIREMENTS

A. Scope of Services .......................................................................................... 10 1. University of Alaska ............................................................................... 11

a. Centralized operations for UA System ............................................. 11 b. Decentralized operations - MAUs .................................................... 12

2. University of Alaska Foundation ........................................................... 12 3. KUAC-TV and KUAC-FM Radio Stations .............................................. 12 4. UAA and UAF: NCAA Agreed upon procedures .................................... 13

B. Audit Standards ........................................................................................... 13

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C. Reporting Requirements 1. Reports ................................................................................................... 13 2. Certificate for Bond Covenant Compliance ........................................... 13 3. Reporting to the Board of Regents and Board of Trustees ................... 14

D. Special Considerations ................................................................................ 14

E. Working Paper Retention and Access ......................................................... 14

F. Organization 1. University of Alaska (UA) System.......................................................... 15 2. University of Alaska (UA) Foundation .................................................. 15 3. UA and UA Foundation Consolidated Endowment Fund ..................... 16 4. KUAC-TV station and KUAC-FM Radio station ................................... 16

G. Audit Meetings and Progress Reports ......................................................... 16

H. Due Dates for Final Reports ........................................................................ 17

I. Assistance to be provided by UA 1. Internal Audit Staff Assistance .............................................................. 17 2. Fund Accounting Staff Assistance ......................................................... 17

J. Auditor Qualifications 1. Description of Offeror’s organization .................................................... 18 2. Offeror’s Quality Control Review ........................................................... 18 3. Professional Staff Continuing Education .............................................. 19 4. Proposed Staffing ................................................................................... 19 5. Changes to Key Personnel ...................................................................... 19

K. Similar Contracts ......................................................................................... 19 L. Auditor Independence and Licensure ........................................................ 20 M. Work Plan ................................................................................................... 20 N. Anticipated Potential Audit Problems......................................................... 21 O. All-inclusive Price/Rate Offers .................................................................... 21 P. Price/Rate Offers ......................................................................................... 21 Q. References (website addresses) ................................................................... 21

IV. PROPOSAL EVALUATION AND BASIS OF AWARD .......................... 22

A. Preliminary Administrative Evaluation ..................................................... 22 B. Technical Evaluation Criteria ......................................................................23 C. Scoring Methodology .................................................................................. 24 D. Price Evaluation ........................................................................................... 25 E. Best Value Determination ........................................................................... 25 F. Oral Presentations ...................................................................................... 26 G. Best and Final Offers .................................................................................. 26

RATE RESPONSE FORMS: available as a linked MSExcel Workbook (see Electronic Signature Page, p.2)

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I. ELECTRONIC PROPOSAL SYSTEM

A. ELECTRONIC SUBMITTAL PROCEDURE

The University of Alaska Fairbanks Procurement & Contract Services department (UAF/P&CS) has adopted an on-line solicitation procedure to better serve the University, vendors, and the public with the following objectives:

• Be responsive to current business practices through web-based services

• Simplify the availability of documents

• Facilitate Offerors responses to a solicitation

• Conserve resources including staff and offeror preparation time

• Enhance communications

• Foster competition

This solicitation document describes the required services and is supplemented with reference documents and required forms on the Electronic Signature Page. A list of financial reference documents is on page 22. Offerors should download, review, and print the documents identified on the Electronic Signature Page at their earliest convenience. Documents are organized in two groups: Reference documents, and Required Forms. All documents and forms should be reviewed and those documents that require signatures shall be submitted with the proposal/offer. The required submittal documents together with the technical proposal shall be assembled in the required order and combined into one electronic PDF. It shall be accompanied by a second PDF file containing the Offeror’s rate response form and any other rate/cost information. All reference documentation related to this solicitation may be accessed at the University ofAlaska Fairbanks Procurement & Contract Service website:http://www.uaf.edu/procurement/community/solicitations/current-solicitations/index.xml

(Note: The terms offeror(s), vendor(s), and contractor(s) are used interchangeably throughout this solicitation.)

B. ELECTRONIC VERSION OF RFP

Offerors may request an MS Word version of this document to facilitate preparation of a proposal. The University of Alaska Fairbanks Procurement & Contract Services Administrative Policy states: "This solicitation is provided in MS Word format to assist Offerors in the preparation of a proposal. The Offeror may not add, delete, or alter any language in this solicitation. In the event that there is any difference between the language contained in the MS Word version of the solicitation and the Adobe PDF version accessed on the UAF/P&CS website, the version on the website shall prevail."

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II. PURPOSE OF SOLICITATION AND GENERAL INFORMATION

A. PURPOSE OF SOLICITATION

The University of Alaska (UA) is soliciting proposals from qualified companies (Offerors) to provide External Audit Accounting Services consisting of, at a minimum, audit of the University of Alaska Annual Financial Statements, the University of Alaska audit in accordance with OMB A-133 and the UA Foundation Annual Audited Financial Statements.

All Offerors submitting proposals are responsible for examining this entire Request for Proposals and supplemental documents, including this document and reference materials. Failure to do so shall be at the Offeror’s risk.

ANTICIPATED SCHEDULE FOR CONTRACT AWARD Contract Award date (approximate): January 15, 2013

NORTH AMERICAN INDUSTRY CLASSIFICATION SYSTEM

(NAICS) CODE: 541211

NAICS CLASSIFICATION NAME:

Certified Public Accountants

In order to qualify as a small business for this solicitation, the business receipts of the company and its

affiliates during the preceding twelve (12) month period must not exceed

$19.0 million.

B. GENERAL INFORMATION

To be considered, an Offeror must meet the minimum qualifications outlined herein, be able and available to perform work and deliver the required services in Alaska, and submit one (1) electronic proposal (two data files) which must be received by UAF Procurement & Contract Services, Room 103 Administrative Services Center, 3295 College Road, Fairbanks, Alaska 99709 by the date and time specified on the RFP Cover Sheet, or as subsequently amended.

As stated in the Instructions to Offerors, any deviations in a proposal from the requirements of this RFP must be fully disclosed in detail on the Statement of Compliance Form and submitted with the proposal. Failure by an offeror to disclose all such information as required may result in disqualification of that proposal as being non-responsive and removed from further consideration.

In addition to meeting the requirements for technical responsiveness, which include compliance with all RFP requirements, a proposal may not be contingent upon, or subject to, any other contract or agreement, unless required by law, whose terms and conditions may be in conflict with the terms and conditions of the RFP, or whose terms and conditions purport to govern or supersede those of the RFP.

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It is the intent of the University to evaluate proposals and, if it deems necessary, to schedule oral presentations. Evaluations are expected to be completed within one month of the proposal submission date.

This is only a Request for Proposals and is not an offer or order to perform services, and is not a commitment on the part of the University of Alaska to award a contract.

C. FAXED PROPOSALS SHALL NOT BE ACCEPTED

Proposals shall NOT be ACCEPTED by fax transmission, by telex, by any printed means, or by any means other than as electronic files submitted as an e-mail message attachment or by physically delivering a USB drive or a CD/DVD to the Procurement & Contract Services office before the date listed on the cover page of this RFP. UA reserves the right to reject any or all proposals.

D. BASIS OF AWARD – BEST VALUE

Proposals will be evaluated on the basis of Best Value. Best Value criteria allow for award of a contract to the responsible, responsive Offeror whose proposal, in the judgment of the University of Alaska, offers the best overall value to the University. This methodology utilizes comparison of competing proposals one to another, and permits award of a contract to other than the highest non-price, technical scored offer, or to other than the lowest-priced offer. Please see the Evaluation and Basis of Award section of this document for more information.

E. INQUIRIES/QUESTIONS RECEIVED PRIOR TO THE DEADLINE FOR RECEIPT OF PROPOSALS

All questions concerning this RFP shall be addressed by email to Stanley R. Schwafel, Senior Contracting Officer, Procurement & Contract Services/UAF, PO Box 757940, Fairbanks, Alaska 99775-7940 (srschwafel@alaska.edu), who is the single point of contact for any inquiries regarding this RFP. Offeror’s questions and any University responses will become public records. Questions may also be faxed to (907) 474-7720.

Generally there are two types of questions that arise. The first type typically requires directing the questioner to the specific section of the RFP where the answer may be found. At the option of the University, response to this type of question may be given over the telephone; such questions and answers are unofficial and in no case shall an oral response to a question affect any aspect of the RFP process. The second type of question involves clarifying or interpreting parts of the RFP or the intent of the RFP. While the University has no obligation to respond to such questions, this type of question, and any response, will be made in writing. Any written responses conveying material information will be provided to all recipients of the original solicitation. If any oral responses are

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given, or claimed to have been given, no person may rely upon them and they will not affect any aspect of this RFP process. Offerors who seek or receive information regarding this solicitation from any University official other than the individual listed above may be declared non-responsive and removed from further consideration.

Note: Prospective Offerors are encouraged to submit questions or requests for clarification. The deadline for submission of questions is September 18, 2012.

F. UA INTENDS TO EVALUATE PROPOSALS AND AWARD A CONTRACT WITHOUT DISCUSSIONS

The University of Alaska reserves the right to make award of a contract without conducting negotiations or discussions with offerors. However, the University reserves the right to conduct discussions with offeror(s) if it determines that they may be useful and that they will produce the best outcome for the University.

Proposals will be reviewed by an evaluation committee in accordance with the criteria and methodology described in the Evaluation and Basis of Award section of this RFP. During the review process, the University reserves the right, where it may serve UA’s best interests, to request additional information or clarifications from Offerors and, if the University deems additional discussions or information to be useful and/or necessary to the fair and complete evaluation of a proposal, to allow corrections of errors or omissions. At the discretion of the evaluation committee and the responsible Procurement Officer, Offerors may be requested to make oral presentations.

G. CONTRACT TYPE AND KIND

Any contract awarded as a result of this solicitation will be a professional services contract with firm-fixed-prices, negotiable when applicable, during the period of performance for which the offered prices and/or rates shall include all plant, labor, hardware, software, travel, shipping, and administrative costs associated with providing the services described in this solicitation. Rate changes, if allowable under the contract and requested by the contractor, shall be negotiated with the Contracting Officer, Procurement & Contract Services/UAF, in accordance with the terms of the sample contract General Provisions, Clause 27. Price Adjustment (Fixed Price Contract). Note that Offeror’s rates shall be effective for each year of a possible five- (5-) year contract term. (See below).

H. CONTRACT TERM/PERIOD OF PERFORMANCE

The term of any contract issued as a result of this solicitation will be for one (1) year with services beginning approximately February 1, 2013. A five- (5-) year contract period is contemplated, subject to the recommendation of the Evaluation Committee, subject to annual review, the satisfactory negotiation of

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contract terms, the concurrence of the University of Alaska Board of Regents and the UA Foundation Board of Trustees, and the availability of funding.

The University of Alaska reserves the sole right to renew the contract for up to four (4) additional one- (1-) year periods, potentially extending the contract through January 31, 2018 contingent upon continued availability of funding, satisfactory contractor performance, and the University’s continued need for the products or services.

Please note: The successful Offeror shall be required to provide start-up and implementation services from the date of contract award (approximately January 15, 2013).

I. PERIOD OF ACCEPTANCE OF PROPOSALS

Any proposal shall remain valid for a minimum of one hundred eighty (180) days after the date for receipt of proposals listed on the cover page to this RFP, except as otherwise specified in this solicitation.

J. APPROVAL OF CONTRACTOR PERSONNEL

The University of Alaska reserves the right to approve or reject any Contractor personnel in the performance of any contract(s) issued as a result of this solicitation without prejudice.

K. MODIFICATIONS TO CONTRACT

The terms and conditions of any contract awarded as a result of this RFP shall only be modified in writing with signatures by duly authorized representatives of both UA and the contractor.

L. CONTRACT ADMINISTRATOR(S)

The Contract Administrators of any contract(s) awarded as a result of this solicitation will be the UA Director of Financial Accounting.

M. CONTRACT CONTENTS

The contents of this RFP and the contents of any offer from an offeror subsequently selected for award of a contract will be incorporated, either directly or by selective reference, into a contract issued by UA, unless terms, conditions, and sample documents provided by the Offeror are excluded as contrary to the best interests of UA.

N. PROPRIETARY INFORMATION

Proposals shall clearly indicate any information which is of a proprietary nature. Proprietary information must be limited to confidential information as defined in

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Instructions to Offerors (Public Information). Proposals will become public information after award of a contract in accordance with Alaska law. Once submitted, all proposals become the property of the University of Alaska.

O. CONFIDENTIALITY

All Offerors responding to this RFP are required to keep all data strictly confidential in compliance with all FERPA, HIPAA and State of Alaska laws and regulations. Failure to comply with this requirement may result in elimination of that Offeror’s proposal and possible litigation. Offerors shall familiarize its staff with, and comply with, all federal and state regulations that pertain to services provided under a contract resulting from this solicitation.

P. DOCUMENTS AND DATA PROVIDED BY THE UNIVERSITY

In addition to documents available on the Procurement Department website, additional information about the organization of the University can be found at: www.alaska.edu. Financial Reports and other information are available at the website addresses located on page 23 of this solicitation. Those reports are representative of the current operations of the University.

III. STATEMENT OF SERVICES AND REQUIREMENTS

A. SCOPE OF SERVICES

The University of Alaska requires the successful offeror to evaluate its financial records (and the record of other related organizations), and to express an opinion on the fair presentation of its financial information in conformance with generally accepted accounting principles (GAAP). Specifically, the University of Alaska is seeking opinions on the following:

1. University of Alaska

2. OMB Circular A-133: all auditor compliance reports

3. University of Alaska (UA) Foundation

4. University of Alaska and University of Alaska Foundation Consolidated Endowment Fund (Consolidated Endowment Fund)

5. An auditor’s Certificate for General Revenue Bond Covenant compliance in accordance with the University’s Trust Indenture

6. KUAC-TV and KUAC-FM Radio (public broadcasting stations located on the University of Alaska Fairbanks campus) [OPTIONAL]

7. University of Alaska Anchorage (UAA): NCAA-Required Agreed-Upon Procedures for Division II [OPTIONAL]

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8. University of Alaska Fairbanks (UAF): NCAA-Required Agreed-Upon Procedures for Division II [OPTIONAL]

Items 1. through 5., above, are required activities to be included in any offeror’s proposal. Items 6., 7. and 8. are optional and shall be assigned a line item price if included in an offeror’s proposal. Please refer to the rate response form accessible on the Electronic Signature Page.

1. University of Alaska

The financial activities of the University of Alaska are headed by the Vice President for Finance and Chief Financial Officer. The campuses operate under procedures set by the UA System for budgeting, accounting, procurement, risk management, and payroll.

The System staff coordinates the activity related to financial statement preparation and audit work.

a. Centralized operations for the University of Alaska System include:

• Investment of all funds

• Reconciliation of vendor and payroll checking accounts and payroll liability accounts

• Banking arrangements

• System-wide monitoring of expenditures compared to budget

• Budget coordination and submission of budget requests to the State

• Reconciliation of automated control accounts, accounts receivable, tuition calculation, and accounts payable

• Payroll and benefit remittances

• Payroll data and tax reporting

• Internal Revenue Forms 1099, 1098-T, 1042-S and W-2 reporting

• Monitoring and maintaining the integrity of computerized databases

• Calculation of the lapse of State appropriations

• Accounting for funds other than current funds

• Review of campus-prepared reconciliations

• Unrelated business income tax return preparation (990T)

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b. Decentralized UA System operations occurring at the major administrative units (MAUs) include:

• Current fund operations including monitoring of expenditures compared to budget

• Accounts receivable detail

• Procurement

• Accounts payable

• Journal vouchers

• Payroll input

• Reconciliation of balance sheet accounts related to decentralized operations, and

• Grant and Contract Administration

2. University of Alaska Foundation

The Foundation’s board of trustees, finance and audit committee and investment committee are separate and independent from the University of Alaska Board of Regents. The Foundation’s treasurer is appointed jointly by the University President and the Foundation Board Chair. The UA Foundation finance staff are all University employees in the reporting line to the treasurer. The Chief Investment Officer oversees the Foundation accounting department and has primary responsibility for management of University and Foundation investments. The Accounting Manager has responsibility for the general ledger and financial statement and tax return preparation. Two accountants process Foundation receipts and disbursements and prepare account reconciliations.

3. KUAC-TV and KUAC-FM Radio Station

The information for KUAC's financial statements and audit information are extracted from the University of Alaska and the University of Alaska Foundation records. KUAC employs a director of finance and administration who is responsible for monitoring its financial activity. The KUAC-TV and radio financial statements are prepared according to GAAP and must meet the Corporation for Public Broadcasting (CPB) requirements. UA wishes to explore inclusion of KUAC audit services as part of the total professional services contracted package (1. through 5., above), but reserves the right to contract separately for the KUAC audit services. Offerors are requested to propose the KUAC services separately to allow KUAC management maximum flexibility to procure these services.

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4. UAA and UAF NCAA Agreed Upon Procedures

NCAA member institutions’ (“institution”) intercollegiate athletics programs are mandated under the provisions of NCAA Constitution clause 3.2.4.16 and others. In accordance with those requirements, all revenues, expenses and capitalized expenditures on behalf of an institution’s intercollegiate athletics program, including those by outside entities, are reported annually by an independent accountant from outside the institution every three years. The financial information to support the athletics departments are maintained on the centralized accounting system. Offerors are requested to propose the NCAA services separately to allow the athletic departments maximum flexibility to procure these services.

B. AUDIT STANDARDS

The successful offeror shall perform the audit work in accordance with generally accepted auditing standards as set forth by the American Institute of Certified Public Accountants, the standards for financial audits set forth in the U.S. Government Accountability Office’s Government Auditing Standards, and the provisions of U.S. Office of Management and Budget (OMB) Circular A-133, Audits of States, Local Governments and Non-Profit Organizations.

C. REPORTING REQUIREMENTS

1. Reports

Following the completion of the audit work of a fiscal year's financial statements, the successful offeror shall issue reports on the fair presentation of the financial statements in conformance with generally accepted accounting principles for the University of Alaska, the University of Alaska Foundation, and the Consolidated Endowment Fund to include issuance of all reports required under the rules and procedures of OMB A-133. A management letter shall be issued for the University of Alaska and the UA Foundation, even if no deficiencies are found.

2. Auditor’s Certificate for Bond Covenant Compliance

An auditor’s Certificate for Bond Covenant Compliance shall be issued in accordance with Article VII, Sections 701 to 714, inclusive, of the Trust Indenture dated June 1, 1992, with First Interstate Bank of Washington, or successor trustee. The certificate shall state whether or not, to the knowledge of the signer, the University is in default with respect to any of the covenants, agreements or conditions on its part contained in this Indenture, and if so, the nature of such default.

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3. Reporting to the Board of Regents and to the Foundation Board of Trustees

Auditors shall ensure that the University of Alaska's Board of Regents and the UA Foundation’s Board of Trustees are informed of each of the following areas:

a. The auditor's responsibility under generally accepted auditing standards.

b. Significant accounting policies.

c. Management judgments and accounting estimates.

d. Significant audit adjustments.

e. Other information in documents containing audited financial statements.

f. Disagreements with management.

g. Management consultation with other accountants.

h. Major issues discussed with management prior to retention.

i. Difficulties encountered in performing the audit.

D. SPECIAL CONSIDERATIONS

The financial statements of the University of Alaska are included as a component unit of the financial statements of the State of Alaska. It is not anticipated that the successful offeror will be required to provide special assistance to the State of Alaska's auditors.

The schedule of expenditures of federal awards and related auditor's report, as well as the reports on the internal control structure and compliance shall not be included with the financial statements but shall be issued as separate reports.

The UA Foundation is presented as a component unit of the University in accordance with GASB Statement No. 39, Determining Whether Certain Organizations Are Component Units-An Amendment of GASB Statement No. 14. This statement essentially consolidates the Foundation’s financial statements with the University’s.

E. WORKING PAPER RETENTION AND ACCESS

All working papers and reports shall be retained, at the successful Offeror’s expense, for a minimum of three (3) years, unless the firm is notified in writing by the University of Alaska or UA Foundation of the need to extend the retention period. The offeror shall make working papers available, upon request, to the following parties or their designees: University of Alaska, UA Foundation,

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Department of Education, Department of Defense, Office of Naval Research, Defense Contract Audit Agency (DCAA), the U.S. Government Accountability Office (GAO), auditors of entities of which the University of Alaska is a subrecipient of grant funds, and auditors of the State of Alaska.

In addition, the offeror shall respond to the reasonable inquiries of successor auditors and allow successor auditors to review working papers relating to matters of continuing accounting significance.

F. ORGANIZATION

1. University of Alaska (UA) System

The University of Alaska is the only public institution of higher learning in the state of Alaska. It represents a statewide system of higher education consisting of three regional universities, ten lower division college centers, and various extension and research sites. The University was established at Fairbanks, Alaska by Congress in 1915 as the Alaska Agricultural College and School of Mines. In 1935 it was renamed the University of Alaska, and in 1959 was established as the State University under the Alaska State Constitution. The University has expanded to include full-service universities in Fairbanks, Anchorage, and Juneau, lower division college centers in Bethel, Dillingham, Ketchikan, Kodiak, Kotzebue, Nome, Palmer, Sitka, Soldotna, Valdez, and rural education and extension sites throughout the state.

The University is governed by an 11 member Board of Regents appointed by the governor. President Patrick Gamble serves as the chief executive officer. Chancellors head each of the major regional academic units: the University of Alaska Fairbanks (UAF), the University of Alaska Anchorage (UAA), and the University of Alaska Southeast (UAS). The UA System's administrative offices are located on the Fairbanks campus.

2. University of Alaska Foundation

The University of Alaska Foundation is a separate, nonprofit corporation established in 1974 to solicit, manage and invest donations for the exclusive benefit of the University of Alaska. The UA Foundation is a tax-exempt organization as described in subsection 501(c)(3) of the Internal Revenue Code and qualifies as a public charitable organization under Subsection 170(b)(1)(A)(vi) of the Internal Revenue Code. The Foundation is separate and distinct from the University of Alaska and is governed by a 28 member Board of Trustees. President Gamble, two members of the Board of Regents and the MAU Chancellors serve as ex officio trustees, together with many prominent Alaskan citizen trustees.

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The Foundation’s accounting records and documents are completely separate from the University records. A substantial portion of the Foundation’s activity is providing scholarships to University students, making disbursements based on requests of University departments, as well as funding University costs billed to the Foundation through the University's restricted fund billing process. Staff members who report to the University's Associate Vice President for Finance record the receipts and disbursements of the Foundation, as well as maintain its accounting records. The Associate Vice President for Finance is the Treasurer of the Foundation.

3. University of Alaska and UA Foundation Consolidated Endowment Fund

Effective July 1, 1997, management of the University’s land grant trust fund was transferred from the State of Alaska Department of Revenue to the University. The Foundation and the University agreed to consolidate the Foundation’s pooled endowment funds and the University’s land grant trust funds into a Consolidated Endowment Fund for investment purposes. The net assets and related activity for their respective investment in the fund are reflected in the financial statements of the Foundation and the University. All activity of the Consolidated Endowment Fund is recorded and maintained in the Foundation’s accounting system.

4. KUAC TV and KUAC-FM Radio Stations

KUAC TV and FM Radio (KUAC), a public telecommunications entity, is operated by the University of Alaska Fairbanks. The KUAC financial statements include KUAC festival (annual fund raising activities) and underwriting funds managed by the University of Alaska Foundation and operating funds from state and federal sources. The festivals are annual fund-raising programs to solicit donations from the general public. The University of Alaska makes disbursements from festival funds for program costs at the direction of KUAC. Festival funds are then reimbursed by the University of Alaska Foundation.

G. AUDIT MEETINGS AND PROGRESS REPORTS

An audit planning meeting will be held prior to March 1st of each contract year to establish the scheduling of audit procedures for each fiscal year. The University strongly prefers to do as much control testing as possible during the summer months. Fall test work shall be focused on cut-off testing and statement support procedures.

Entrance and exit meetings will be scheduled at mutually agreed-upon times at the beginning and end of each major section of audit work. At a minimum, entrance and exit conferences shall be held for interim work, year-end field work, and A-133 compliance work.

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For any segment of audit work lasting more than two weeks, progress meetings and oral reports will be required weekly. The purpose of these meetings will be to discuss any findings noted and to update management on the status of the audit services contract progress.

The external auditors are requested to update the Audit Committee of the Board of Regents at the June and September board meetings each year regarding the audit plan and progress. A presentation of audit results is required at the December board meeting each year.

H. DUE DATES FOR FINAL REPORTS

The UA financial statement and A-133 reports shall be completed to meet the State of Alaska’s requirements. The necessary timing of procedures to meet the State’s deadlines will be agreed upon by March 1st with the external auditors supplying a “provided by client list” by April 1st of each year.

I. ASSISTANCE TO BE PROVIDED BY UA

1. Internal Audit Staff Assistance

The internal audit staff of UA can provide approximately 320 hours of audit assistance in Fairbanks as specified by the external auditors. In the past, assistance has consisted of year-end “cutoff” procedures, inventory observation and price testing, cash test work, plant fund additions, and auxiliary fund analysis. The External auditor contractor and the internal audit staff will mutually agree upon the timing and extent of effort to accomplish the requirements. Offerors are asked to offer a (REQUIRED) price of services with and without Internal Audit Staff’s assistance. Please refer to the rate response form referenced elsewhere in this RFP.

2. Fund Accounting Staff Assistance

The fund accounting staff and responsible management personnel can also assist the audit contractor by providing information, documentation and explanations. The preparation of the confirmations, in formats provided by the external auditor, will be the responsibility of the University of Alaska. In addition, the University will provide the following for the University of Alaska, and the University of Alaska Foundation audits:

a. Pro-forma work papers in formats agreed to by external auditors.

b. Standard audit work paper analysis in formats agreed to by the external auditors including transfer schedule, lapse schedule, and fund balance schedule.

c. Analytical review work on selected accounts or financial statement line items.

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d. Run sample selection programs per agreed upon selection criteria by the external auditors.

e. Draft and Final financial statements.

f. Proofread "blue line" drafts for auditor approval prior to publishing any financial statements incorporating the auditor's opinion.

g. The University will provide proforma work papers and audit work paper analyses in formats agreed to by the external auditors for the KUAC audit.

h. The University will run sample selection programs in accordance with agreed-to selection criteria and prepare and type the Schedule of Expenditures of Federal Awards for the A-133 Single Audit.

J. AUDITOR QUALIFICATIONS

1. Description of Offeror’s Organization

Offerors shall state the size of the firm, the size of the firm's audit staff, the location of the office from which the work on the University of Alaska’s proposed contract is to be performed, and the number and type of the professional staff to be employed in the University’s audit work on a full-time basis, and the number and type of the staff to be so employed on a part-time basis.

If the offeror is a joint venture or consortium, the qualifications of personnel from each firm comprising the joint venture or consortium shall be separately identified and the firm that is to serve as the principal auditor shall be clearly stated in the proposal.

2. Offeror’s Quality Control Review

Offerors shall submit a copy of the report on its most recent external quality control review, with a statement whether that quality control review included a review of specific university, government, and nonprofit engagements.

The offeror shall also provide information on the results of any federal or state desk reviews or field reviews of its audits during the previous three (3) years. In addition, the offeror shall provide information on the circumstances and status of any disciplinary action taken or pending against the firm during the previous three (3) years with State of Alaska regulatory bodies or professional organizations.

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3. Professional Staff Continuing Education

An affirmative statement shall be included in the proposal indicating all assigned professional staff has received continuing professional education in accordance with standards outlined in the GAO’s Government Auditing Standards (yellow book).

4. Proposed Staffing

The offeror shall identify the principal supervisory and management staff, including partners, managers, other supervisors and specialists who will be assigned to the contracted services and indicate whether each person is licensed to practice as a certified public accountant. Offeror’s shall provide information on the university, government, and nonprofit auditing experience of each person, including information on relevant continuing professional education for the previous three (3) years and membership in professional organizations relevant to the performance of these audit services.

The offeror shall provide as much information as possible regarding the number, qualifications, experience and training, including relevant continuing professional education, of the specific staff to be assigned to the University of Alaska’s prospective contract. Offeror’s also shall indicate how the quality of staff over the term of the contract will be assured.

5. Changes to Key Personnel

The contracted firm’s partners, managers, other supervisory staff and specialists may be changed if those personnel leave the firm, are promoted, or are assigned to another office. Other audit personnel may be changed at the discretion of the offeror provided that replacements have substantially the same or better qualifications or experience. However, in either case, the University of Alaska and the University of Alaska Foundation retain the right to approve or reject replacement personnel.

K. SIMILAR CONTRACTS

Offerors shall list the most significant contracts (a maximum of five) performed during the previous five (5) years that are similar to the services described in this request for proposals. Prior contract information shall be listed in order of size (largest to smallest) on the basis of total billed staff hours to accomplish the services. Describe the scope of work, dates, contract partners, total hours, and the name, telephone number and e-mail address of the principal client contact.

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L. AUDITOR INDEPENDENCE AND LICENSURE

Offerors shall affirm in a written statement that it is independent of the University of Alaska and its component units (University), and that it is independent of the State of Alaska (State) and any other component units of the State, referring to the standards of independence as defined by the U.S. General Accountability Office’s Government Auditing Standards.

Offerors shall also affirm in writing that it is currently and properly licensed to practice in the State of Alaska, and that their key personnel who will conduct or oversee the contracted services contemplated under this request for proposals hold current and appropriate professional licenses to practice in Alaska.

M. WORK PLAN

The proposal shall set forth a work plan, including an explanation of the audit methodology to be followed, to perform the services requested here. The work plan shall refer to sources of information, such as the University of Alaska's financial statements, organization charts, manuals and programs, and financial and other management information systems.

Offerors shall provide the following information in its proposed work plan/audit approach:

1. Proposed segmentation of the contract (i.e., UA Financial Statements, Foundation audit, Consolidated Endowment Fund, KUAC audit and CPB reports, A-133 audit, NCAA Agreed-Upon Procedures.)

2. Level of staffing (number of people) and number of hours to be assigned to each proposed segment of the contract.

3. The extent to which statistical sampling is to be used in performing the contracted services.

4. The extent of the use of EDP (Electronic Data Processing) software and techniques in performing the contracted services.

5. The type and extent of analytical procedures to be used in performing the contracted services.

6. The approach to be taken to gain and document an understanding of the internal control structures.

7. The approach to be taken in determining laws and regulations that will be subject to audit test work.

8. The approach to be taken in drawing audit samples for purposes of tests of compliance.

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N. ANTICIPATED POTENTIAL AUDIT PROBLEMS

The Offeror’s proposal shall identify and describe any anticipated potential audit problems, the offeror’s approach to resolving these problems, and any special assistance that may be requested from the University of Alaska.

O. ALL-INCLUSIVE PRICE OFFER

The offeror’s price offer shall contain all pricing information, and include all costs, in order to perform the audit services described in this RFP. The total all-inclusive maximum price offered shall include all direct and indirect costs including all out-of-pocket expenses (e.g., travel, lodging and subsistence). Separate optional price offers shall be submitted for the KUAC-TV and FM Radio audit services and for the NCAA auditing services for both the UAA and UAF campuses.

NOTE: Price offers shall be submitted as a separate electronic file, as described elsewhere in this RFP. No price or cost information shall be contained in the technical (narrative) proposal.

The University of Alaska is not responsible for expenses incurred in preparing and submitting a proposal. Any costs associated with preparing the Offeror’s proposal shall not be included in the proposal.

P. PRICE/RATE OFFERS

Offerors shall complete the Rate Response Forms for this RFP, which are accessible on the Electronic Signature Page as a link in the Required Submittals list. Only price/rate offers submitted on the Rate Response Form in the form and substance required shall be accepted. Follow all instructions included with the Rate Response Form. Part A-1 of the rate form is for performance of audit services WITH assistance from UA’s Internal Audit Department staff. Part A-2 of the rate form is for services WITHOUT assistance from UA staff. Part A-3 lists OPTIONAL services for which the University of Alaska is also seeking price offers. Part B of the rate form requests only HOURS to perform the services listed.

Q. REFERENCES

1. 2011 UA Financial Statements: http://www.alaska.edu/fund-accounting/financial/financial_statements_11_ua.pdf

2. 2011 UA A-133: http://www.alaska.edu/fund-accounting/audit/fy11.pdf

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3. 2011 UA Foundation Financial Statements: http://www.alaska.edu/files/foundation/UA-2011-Audited-Financial-Statements.pdf

4. University of Alaska Organizational Charts: http://www.alaska.edu/OrgCharts/

5. FY12 Enrollment Statistical Data: http://www.alaska.edu/swbir/ir/publications-reports/unit09/TitleIII_enrollment_statistics.pdf

6. FY11 UA In Review http://www.alaska.edu/swbir/ir/ua-in-review/uar2012/UAR2012.pdf

IV. PROPOSAL EVALUATION AND BASIS OF AWARD

Proposals will be subjected to a preliminary administrative compliance determination and to a technical evaluation. Proposals meeting the administrative compliance requirements will be forwarded to an evaluation committee.

A. PRELIMINARY ADMINISTRATIVE EVALUATION

All proposals will be evaluated to determine if they are responsive to the administrative and submittal requirements as to form, format, and substance. This administrative compliance evaluation, to be performed by the responsible Procurement Officer, will determine that:

1. The proposal was received prior to the deadline for submission of proposals.

2. The proposal was submitted in the correct format.

3. The correct forms (electronic files) were submitted in the required order (as described on the Electronic Signature Page): one electronic file containing the technical proposal AND ALL REQUIRED SUBMITTAL FORMS, and a second electronic file containing the Rate Response Form(s) and any price/rate supporting documentation.

4. All parts of the Rate Response Form were completed.

5. All proposal forms were properly filled in, signed and dated.

6. Any other necessary forms were included.

7. All material alterations or erasures to any forms, if any, were initialed by the signer of the proposal.

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8. The proposal includes evidence of a current State of Alaska business license WHICH IS REQUIRED BY STATE OF ALASKA LAW AT THE PROPOSAL SUBMISSION DATE.

Proposals failing to comply with all administrative requirements may be declared non-responsive and removed from further consideration.

B. TECHNICAL EVALUATION CRITERIA

Proposals that comply with preliminary administrative compliance requirements will be forwarded to an evaluation committee. Proposals will be evaluated for technical merit according to the requirements and criteria described in this solicitation. The committee will function under the guidance of the UA Procurement Officer who serves as chair and ex officio member of the committee.

Proposals will be evaluated and scored using a weighted method as described below.

Evaluation Criteria for Independent Audit Professional Services

Weight

1. Experience and Qualifications 60

2. Suitability of the Audit Work-Plan 40

TOTAL, weight: 100

1. Experience and Qualifications

a. Overall capabilities of the firm and audit staff.

b. Relative continuity and turnover of the professional staff assigned.

c. Higher education experience.

d. OMB Circular A-133 audits of federal financial assistance.

e. Experience with regulatory cost accounting principles, including A-21 and Federal Cost Accounting Standards.

f. Experience with NCAA athletics examinations.

g. Knowledge and experience auditing ERP1 systems.

h. Knowledge and experience with the COSO2 internal control framework.

1 ERP: Enterprise Resource Planning 2 COSO: Committee of Sponsoring Organizations of the Treadway Commission

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2. Proposed Audit Work plan

a. Describe the approach to assessing internal control risk for each organization.

b. Describe the planned annual audit process with the preferred order and timing of testing.

c. Explain the standard audit approach to the review of automated systems and their security.

d. If applicable, describe how the offeror will minimize the impact of the transition to a new audit firm.

C. SCORING METHODOLOGY

Non-price, technical evaluations of proposals will be performed independently by each committee member, with no attempt to reach a scoring consensus. The committee may discuss the details and features contained in proposals for the purpose of ensuring there is agreement about what is contained there and/or to clarify parts of an offer which may be unclear.

Each committee member will independently score each technical criterion of each proposal using a point range of 1 to 10, with 10 being the highest possible number of points. Each criterion’s points are then multiplied by its weight resulting in a raw weighted score. For example, if Evaluator A assigned 10 points to criterion 1 – Experience and Qualifications, it would result in a raw weighted score of 600 (10 points x 60 [weight] = 600 score).

The raw weighted scores of all non-price technical criteria are then summed to achieve a total weighted technical score from each evaluator for each proposal. The weighted technical scores from each evaluator on each proposal are then summed to achieve an aggregate technical score for each proposal. The aggregate technical scores from all evaluators are then summed and divided by the number of evaluators resulting in an average technical score for each proposal.

Proposals will then be ranked from highest to lowest score based on the average technical score of each proposal. The highest attainable technical score is 1,000.

The University of Alaska utilizes a weighted scoring methodology to inform prospective Offerors of the relative importance of the evaluation criteria, and as an aid to evaluators in assigning a tangible expression of the relative strength or weakness of technical criteria. Based upon the scoring results, the University may seek clarifications or additional information from any or all Offerors whose proposals are in the competitive range. The competitive range may include proposals receiving both a minimum score of 600 points in the technical evaluation and, in the sole discretion of the procurement officer, achieving a technical score high enough to remain under consideration for award when ranked against other proposals received. This procedure is not a strict

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mathematical formula and may not be challenged or protested on that basis except in the case of obvious arithmetic errors.

D. PRICE EVALUATION

During the technical evaluation period, the Rate Response Form(s) from each proposal will be reviewed by the procurement officer.

Price offers from each proposal will be tabulated from lowest price to highest price for years one (1) through five (5), and the proposals will be ranked from lowest to highest aggregate price. This information will be kept confidential from the evaluation committee until all technical evaluations are complete and technical evaluation scores are delivered to the procurement officer. At that time, evaluators will receive copies of the price offers and rankings.

E. BEST VALUE DETERMINATION

Under a Best Value solicitation, the University reserves the right to award a contract to an offeror whose proposal may receive other than the highest technical score or to an offeror submitting other than the lowest priced offer. If a proposal appears to be unrealistic in terms of program commitments, price, or reflects an inherent lack of understanding of the complexity and risks of the proposed contractual requirements, it may be removed from further consideration.

Following completion of the technical evaluations and presentation of price information, the evaluation committee will consider which proposal offers the best overall value to the University.

If technical rank order and price order differ, the evaluation committee will discuss the merits of each proposal relative to its price and other proposal’s technical ranks and prices.

In comparing proposals, if one proposal received both a higher technical score and a lower price, then that proposal would represent a better value and the University may award a contract to the firm that submitted that proposal.

If a proposal received a higher technical score, but a higher price than another proposal, then the evaluation committee may determine that the difference in the technical score between the two compared proposals is worth a higher price. If the evaluation committee determines that a proposal with a higher technical score is worth a higher price, then the University may consider that proposal the best value. If, however, a determination is made that a higher technical score is not worth the higher price, and that a proposal with a slightly lower technical score and a lower price is a better value, then the University may choose the offeror with a lower technical-scored proposal. For purposes of paired comparisons, the proposal technical criteria are considered relatively more

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important than price.

The committee will continue to make similar paired comparisons until a consensus is reached on the proposal that represents the Best Value.

F. ORAL PRESENTATIONS

During proposal evaluations, the University may, at its sole discretion, request oral and/or written clarifications from Offerors, or conduct oral and/or written discussions with any or all Offerors.

However, the University may award a contract based only on the submitted proposals, without requesting clarification and/or holding discussions. Therefore, each proposal shall represent the best offer in both technical and price terms.

Not all Offerors may be asked to make oral presentations. The University reserves the sole right to determine which Offerors are included in the competitive range.

G. BEST AND FINAL OFFER

The University of Alaska reserves the right to request clarifications and request a best and final offer (BAFO) from each Offeror within the competitive range. However, the University reserves the right to make award of a contract based exclusively on the submitted proposals without requesting a BAFO.

- END REQUEST FOR PROPOSALS -