COMMITTEE AGENDA MEMORANDUM
Board Audit Committee
Government Code § 84308 Applies: Yes ☐ No ☒
(If “YES” Complete Attachment A - Gov. Code § 84308)
SUBJECT: title
Continue Discussion on the Status of the On-call Management Services Agreement for the Chief Audit Executive (CAE) and Recommend the Board of Directors Initiate a Request for Proposal (RFP).
End
RECOMMENDATION: Recommendation
A. Continue discussion on the status of the On-call Management Services Agreement for the CAE, and
B. Recommend the Board of Directors initiate an RFP.
Body
SUMMARY:
At the January 21st, 2026, BAC meeting staff introduced this topic for consideration. After some discussion, the committee decided to continue this topic at the next committee meeting, and asked staff to investigate other opportunities to include best auditing practices in the scope of services of the next request for proposal.
Summary of Staff Research
Accordingly, staff has attached four guidance publications related to local government auditing best practices as references for the continued discussion as follows:
• Attachment 1 is titled “The role of auditing in public sector governance” by the Institute of Internal Auditors
• Attachment 2 is titled “Guide to selecting a Chief Audit Executive” by the Association of Local Government Auditors
• Attachment 3 is titled “Audit Committee Guidance” by the Association of Local Government Auditors
• Attachment 4 is titled “ALGA Recommends Independent In-House Audit Capacity” by the Association of Local Government Auditors
Further staff research has found that to be credible and effective, public sector audit activities must have:
• Organizational independence
• A formal legal mandate
• Unrestricted access to people, records, and systems
• Sufficient and protected funding
• Competent, professionally qualified leadership
• Objective and skilled staff
• Stakeholder support
• Adherence to professional audit standards (e.g., IIA standards)
Without these elements, audit functions cannot fully protect the public interest.
Recommendation to Initiate an RFP
The current CAE agreement with Sjoberg Evashenk Consulting, Inc. (A4570A/CAS5183) is set to expire on November 22, 2026 after the completion of the five-year agreement including the initial three-year term and two one-year time extensions. To ensure continuity of audit operations and allow sufficient time for the incoming CAE to complete the tri-annual risk assessment and develop the recommended 2027 audit plan by November 30, 2026 as required by the Audit Charter, staff recommends that the BAC proceed with the proposed timeline for the RFP process to select a new CAE:
1) February 18, 2026 (BAC Meeting):
a) Request BAC recommendation to the full Board to initiate an RFP for a new CAE agreement.
2) February 24, 2026 (Board Meeting):
a) Seek Board approval to initiate the RFP.
b) If approved, staff will work with Procurement to issue the RFP.
3) August 25, 2026 (Board Meeting)
a) Request Board approval of the new CAE agreement
i) If Sjoberg is re-selected, the risk assessment can begin in August.
ii) If a new firm is selected, Sjoberg will complete activities through November 22, 2026
iii) If a new firm is selected, the new CAE firm can initiate the Risk Assessment in August.
In the past, the Board Audit Committee (BAC) has expressed a desire to be involved in the evaluation process to select the CAE. During the last CAE procurement process, the BAC selected one of its members to join two staff members on the Evaluation Committee to ensure the BAC’s interests and desires informed the selection process. In this way, the evaluation process was conducted in a manner that maintained the integrity of the procurement process and was unaffected by the Brown Act. The BAC is requested to provide direction on whether or not to assign a committee member to the Evaluation Committee for this procurement (assuming full Board approval). If a BAC member is not assigned to the Evaluation Committee, then the Evaluation Committee would be comprised of staff only.
ENVIRONMENTAL JUSTICE IMPACT:
There are no environmental justice impacts associated with this item.
ATTACHMENTS:
Attachment 1: Role of Auditing in Public Sector Governance
Attachment 2: Guide to Selecting a Chief Audit Executive
Attachment 3: Audit Committee Guidance
Attachment 4: ALGA Recommends In-House Audit Capacity
UNCLASSIFIED MANAGER:
Manager
Darin Taylor, 408-630-3068