RFP__Secondary__EAUF90126_Audit_Services.pdf

MALIA M. COHEN

CALIFORNIA STATE CONTROLLER

August 21, 2026

REQUEST FOR PROPOSAL (RFP) (Secondary) NUMBER EAUF90126 Auditing Services

Notice to Prospective Proposers

You are invited to review and respond to this Request for Proposal (RFP) Number EAUF90126. In submitting your proposal, you must comply with these instructions.

Read the attached document carefully. Please submit all required forms and documents with your proposal response as indicated in this RFP. Any response received after the date and time indicated in this RFP will not be considered for review.

Proposers are advised to check the Cal eProcure website for addendums, modifications, and updates to the Proposal documents. The State Controller's Office (SCO) is not responsible for failure of the prospective proposer to check for any proposal document updates, changes, or answers to questions posted on Cal eProcure. Failure to periodically check the website will be at the Proposer’s sole risk.

If a discrepancy occurs between the information in the advertisement appearing on the Department of General Services, California State Contracts Register (CSCR) on the Cal eProcure website:

https://www.caleprocure.ca.gov and the information in the herein RFP, the information in the attached RFP shall take precedence.

Note that all contracts entered into with the State of California will include by reference General Terms and Conditions (GTC 02/2025) and Contractor Certification Clauses (CCC 04/2017) that may be viewed and downloaded at Internet site https://www.dgs.ca.gov/OLS/Resources/Page-Content/Office-of-Legal-Services- Resources-List-Folder/Standard-Contract-Language. If you do not have Internet access, a hard copy can be provided.

In the opinion of SCO, this RFP is complete and without need of explanation. However, if you have questions, or should you need any clarifying information, please email SCOBids@sco.ca.gov.

Please note that no verbal information given will be binding upon the State unless such information is issued in writing as an official addendum.

State Controller’s Office RFP Number EAUF90126

A. Purpose and Description of Services

1. Background

2. Agreement Term

3. Agreement Amount

B. Minimum Qualifications

1. Proposer Firm Minimum Qualifications

2. Key Staff Minimum Qualifications

3. Background Check

C. Proposal Requirements and Information

1. Key Action Dates

2. Written Questions & Answers

3. Technical Proposal

D. Submission of Proposal E. Evaluation Process F. Award and Protest G. Disposition of Proposals H. Agreement Execution and Performance I. Participation Preference and Incentive Programs

1. Disabled Veteran Business Enterprise Program Participation

2. Disabled Veteran Business Enterprise Incentive

3. Small Business Preference Program

4. Non-Small Business Preference Request

5. Ties between Certified SB/MB and DVBE Businesses

6. Target Area Contract Preference Act

J. Required Attachments Attachment 1, Required Attachment Checklist Attachment 2, Proposal/Proposer Certification Sheet Attachment 3, Contractor Point of Contact Attachment 4, Payee Data Record (STD 204) and Supplement (STD 205)* Attachment 5, Contractor Certification Clauses (CCC 04/2017) Attachment 6, Bidder Declaration (Written) (GSPD-05-105) Attachment 7, California Civil Rights Laws Certification (DGS OLS 04) Attachment 8, Iran Contracting Act Verification Form (DGS PD 3) Attachment 9, Darfur Contracting Act Certification (DGS PD 1)* Attachment 10, California Disabled Veteran Business Enterprise (DVBE) Declarations (STD 843)* Attachment 11, Secretary of State Certification Status* Attachment 12, Target Area Contract Preference Act (TACPA Preference Request for Goods and Services (STD 830)* Attachment 13, Bidder’s Summary of Contract Activities and Labor Hours (DGS/PD 526)* Attachment 14, Generative Artificial Intelligence (GenAI) Disclosure Attachment 15, Acknowledgement of Agreement Exhibits and Policies Attachment 16, Proposal Requirements and Incentives Attachment 17, Contractor/Consultant Organization Information Security Agreement (ISO-004c) Attachment 18, Contractor/Consultant Confidentiality and Non-Disclosure Acknowledgement (ISO-004b) Attachment 19, Proposer Firm Qualifications Attachment 20, Key Staff Qualifications Attachment 21, Proposer Firm References Attachment 22, Key Staff References Attachment 23, Cost Worksheet

Standard Agreement Exhibit A – Scope of Work Exhibit A, Attachment 1 – Deliverable Expectations Document (DED) and Deliverable Acceptance Document

(DAD)

Exhibit A, Attachment 2 – Deliverable Expectation Document (DED) Form (Sample)

Exhibit A, Attachment 3 – Deliverable Acceptance Document (DAD) Form (Sample) Exhibit A, Attachment 4 – Personnel Change Order Request Form Exhibit A, Attachment 5 – Personnel Change Key Staff Reference Form Exhibit A, Attachment 6 – Audit Staff Minimum Qualifications Workbook Exhibit A, Attachment 7 – Prime Contractor Certification – SB Subcontractor Report Exhibit B – Budget Detail and Payment Provisions Exhibit B, Attachment 1 – Cost Worksheet Exhibit C – General Terms and Conditions (GTC 02/2025) Exhibit D – Special Terms and Conditions Exhibit E – Information Technology, Data, and Security Provisions Exhibit F – Resumes

These documents are not required with the Proposal package but are required upon award of the Agreement.

*Submit only if applicable.

**Incorporated by reference only.

A. Purpose and Description of Services

The State Controller’s Office (SCO), Division of Audits, is seeking to establish a contract with a qualified Certified Public Accounting (CPA) firm to support the execution of high-profile, sensitive audits, and reviews. These audits and reviews are critical to ensuring accountability, transparency, and integrity in the use of public funds across state and local programs.

The selected firms must demonstrate substantial experience in:

Local education agency financial, compliance, and performance audits/reviews Government performance, compliance, and operational audits/reviews Local government and special district financial and performance audits/reviews Other expedited, sensitive, high-impact state and local government performance audits/reviews

Depending on the engagement model, deliverables may include:

Audit plans and risk assessments Workpapers and supporting documentation Status reports and briefings Draft and final audit reports Findings with actionable recommendations Data analysis outputs and summaries All deliverables must meet SCO standards and Government Auditing Standards, as applicable Governance and quality assurance SCO will conduct ongoing working paper reviews of engagement as it progresses.

CPA firms must maintain independence and objectivity Use of TeamMate+ Electronic working paper software Confidentiality of sensitive data must be strictly maintained

See the Standard Agreement, Exhibit A, Scope of Work, for a complete description of services.

1. Background

SCO conducts a wide range of financial and performance audits across California’s public sector. Due to increasing audit demand, complexity of programs, and the need for timely delivery of high-impact reports, SCO requires supplemental audit resources.

This RFP establishes the framework for an agreement with a CPA firm to provide services in two primary capacities:

a. Staff Augmentation under SCO direction

b. Independent Audit Execution under SCO oversight

2. Agreement Term

The term of this Agreement shall be for three years, with the option to execute one two-year extension.

The rates in Attachment 23, Cost Worksheet will not increase as a result of any amendment to this agreement. This agreement may be terminated by SCO with a 30-day written notice to the Contractor or by either party with a 30-day written notice.

Contractors are cautioned that no work will begin until the Agreement has been fully executed. If work is performed prior to agreement approval, and the Agreement for any reason is not approved, all previous work performed by the Contractor is considered donated to SCO and no payment shall be made for that work.

3. Agreement Amount

The Contractor and the SCO Contract Manager are responsible for monitoring the Agreement cost to ensure it does not exceed the maximum amount of the Agreement without an executed amendment.

The budget for the initial three-year agreement term and optional two-year extension is $10,000,000.00.

B. Minimum Qualifications

Proposers must meet all the following Minimum Qualifications (MQ) and submit the required attachments and any documents (i.e., organizational charts, resumes, licenses, and degrees, etc.) that clearly explain and substantiate how the Minimum Qualification is met to be considered responsive. A responsive proposal is one that meets or exceeds all the requirements stated in this RFP. Any proposal that does not meet the MQs and does not submit the required documents may be considered non-responsive and may be disqualified.

1. Proposer Firm Minimum Qualifications

The Proposer Firm (Proposer) is expected to have a proven record of success providing Auditing Services and be responsible for all aspects of the service, including any subcontractors and the project team/proposed key staff.

The Proposer must complete and submit as part of the Proposal, Attachment 19, Proposer Firm Qualifications (FQs) Workbook, to confirm that the Proposer experience meets all the qualifications indicated below.

a. The Proposer must be licensed as an active Certified Public Accounting (CPA) firm in good standing. Proposer must submit a copy of its CPA certificate of license.

b. The Proposer must have at least five years’ experience, within the last eight years, performing audit services described within this RFP and the Standard Agreement, Exhibit A, Scope of Work.

c. The Proposer must have a minimum of five years’ experience conducting State government, local government, special districts, or local education agency audits, preferably in California or similar regulatory environments, in accordance with Generally Accepted Government Auditing Standards (GAGAS) or Yellow Book. Qualifying experience may be comprised of:

1) GAGAS/Yellow Book

2) California public sector audits

3) Local education agency and local government financial, compliance, and performance audits

4) Proven ability to conduct performance audits and complex data analysis

5) Experience working with large datasets and public program payment systems

6) Strong quality control system and peer review processes

d. The Proposer must have completed a peer review within the last three years with a rating of “pass”

(or equivalent). The Proposer must submit a copy of the peer review report and any related management letter, if applicable.

2. Key Staff Minimum Qualifications

The Proposer must identify one Engagement Parter / Project Director and three Audit Managers who will be assigned to perform services for this agreement, including subcontractor staff (if applicable). The Proposer must complete Attachment 20, Key Staff Qualifications for all proposed key staff and provide resumes, degrees, valid licenses and/or valid certifications (if applicable) for all proposed key staff to validate staff qualifications. Each key staff must meet the specified qualifications listed in its category.

a. Key Staff Category 1 – Engagement Partner / Project Director

1) Must have a minimum 10 years of audit experience in State government, local government, special districts, or local education agency audits, preferably in California or similar regulatory environments

2) Must have at least five years’ experience managing audit teams conducting performance and financial audits of complex public programs in accordance with GAGAS

3) Must have an active CPA License. Must submit a copy of the active CPA License with the proposal

4) Must have a bachelor’s degree in accounting, finance, or business. Must submit a copy of the degree/diploma.

b. Key Staff Category 2 – Audit Manager

1) Must have a minimum of seven years’ audit experience in State government, local government, special districts, or local education agency audits, preferably in California or similar regulatory environments

2) Must have a minimum of five years’ experience supervising audit teams conducting performance and financial audits of complex public programs in accordance with GAGAS

3) Must have an active CPA License. Must submit a copy of the license or certification with the proposal

4) Must have a bachelor’s degree in accounting, finance, or business. Must submit a copy of the degree/diploma.

3. Background Check

This agreement requires the proposed key staff performing the services of this RFP to pass a Live Scan background check. Upon notice of agreement award, SCO will provide the Contractor all necessary forms and locations for each proposed key staff to complete the background check process.

If proposed key staff are located in the Sacramento area, they must be fingerprinted at SCO.

If proposed key staff are located outside the Sacramento area, but in California, they may go to a

Live Scan location of their choosing.

If proposed key staff are located outside of California, they must go to a local law enforcement agency or other entity licensed to roll fingerprints to request completion of a standard FBI applicant fingerprint card (FD-258) provided by SCO and mail [i.e., United States Postal Service (USPS)] the completed forms and FD-258 back to SCO.

Background checks must be completed and passed prior to execution of the Agreement. If a Contractor’s proposed key staff does not pass the Live Scan background check process, the Contractor must replace the offered individual with a new candidate within seven business days that meets or exceeds all requirements stated in Section B, Minimum Qualifications, Item 2, Key Staff Minimum Qualifications. At SCO discretion, SCO may cancel award of the Agreement subject to failed background checks. Contractors and the proposed key staff will be held to the same background check standards as SCO employees.

The Proposer shall ensure that each proposed key staff under the Agreement are made aware of, understand, and comply with the provisions of SCO Live Scan background checks. Any additional or replacement individuals added to the Agreement will be subject to the same terms.

C. Proposal Requirements and Information

1. Key Action Dates

ACTION DATE

RFP Available to Prospective Proposers August 21, 2026

Written Questions Submittal Deadline August 28, 2026, prior to 5:00 p.m. PT*

Written Questions & Answers Released September 11 by 5:00 p.m. PT*

Final Date for Proposal Submission September 25, 2026, prior to 2:00 p.m.

PT*

Evaluation of Proposals** September 25 through October 7, 2026

Interviews October 8 through October 14, 2026

Notice of Intent to Award October 14, 2026

Proposed Award Date October 22, 2026

Agreement Begins December 1, 2026, or upon DGS approval, whichever is later

*Pacific Time (PT) **Dates after Proposal Submission are estimates only and may be subject to change. SCO will adhere to the listed dates as strictly as possible, but will not be held accountable for changes due to unforeseen circumstances.

2. Written Questions & Answers

a. Proposers may submit questions for clarification of the content of this RFP to

SCObids@sco.ca.gov. Questions must be submitted on or before the Written Questions Submittal Deadline date as stated in Section C, Proposal Requirements and Information, 1. Key Action Dates.

b. Any questions or proposed changes to the RFP or Standard Agreement must be submitted on or before the Written Questions Submittal Deadline date as stated in Section C, Proposal Requirements and Information, 1. Key Action Dates. A bid submitted with alternate agreement language, that was not accepted through an addendum to the RFP, will be considered a counter offer and will not be considered. The State’s Non-IT Services General Terms and Conditions (GTC 02/2025) are not negotiable.

c. The subject line of the email should read, RFP EAUF90126 Questions – Company Name.

d. The Proposer must reference the section and page number about which they are inquiring.

e. Written Questions and Answers will be provided without identifying the submitter. SCO may paraphrase questions, at its sole discretion, for clarity.

f. Questions and Answers will be posted to Cal eProcure on or before the Written Questions &

Answers Released date specified in Section C, Proposal Requirements and Information, 1. Key Action Dates.

3. Technical Proposal

Proposals must describe the Proposer’s qualifications and expertise in the format outlined in this RFP.

A Proposal will not be considered complete unless it contains all the items described below. Technical Proposal includes all the following items:

a. Attachment 1, Required Attachment Checklist

The Proposer shall submit all applicable attachments identified on Attachment 1, Required Attachment Checklist. Proposers are not to alter or modify the forms other than by providing the required information; please note, adding your firm’s logo or letterhead to the form is not considered a modification or alteration of the form.

b. Proposer Firm Desirable Qualifications (FDQ)

The Proposer must complete Attachment 19, Proposer Firm Qualifications, FDQ tab to qualify for additional points.

1) The Proposer has more than five years’ experience conducting State government, local government, special districts, or local education agency audits, preferably in California or similar regulatory environments, in accordance with Generally Accepted Government Auditing Standards (GAGAS) or Yellow Book.

Points will be awarded for each qualifying year of experience beyond five years as follows:

Number of Years’ Experience Possible Points

5.1 Years to 6 Years 5 Points

6.1. Years to 7 Years 6 Points

7.1 Years to 8 Years 7 Points

8.1 Years to 9 Years 8 Points

9.1 Years to 9.9 Years 9 Points

10 Years or More 10 Points

2) The Proposer has at least one year of experience with auditing large payment datasets [e.g., Medi-Cal, Supplemental Nutrition Assistance Program (SNAP)/CalFresh/Women, Infants, and Children (WIC].

Points will be awarded for each qualifying year of experience as follows:

Number of Years’ Experience Possible Points

1 Year to 3 Years 2 Points

3.1. Years to 6 Years 4 Points

6.1 Years to 9 Years 6 Points

9.1 Years or more 8 Points

3) The Proposer has at least one year of experience using analytics tools such as Arbutus, Interactive Data Extraction and Analysis (IDEA), Structured Query Language (SQL), Python, etc. for large datasets.

Points will be awarded for each qualifying year of experience as follows:

Number of Years’ Experience Possible Points

1 Year to 3 Years 2 Points

3.1. Years to 6 Years 4 Points

4) The Proposer has at least one year of fraud detection or forensic audit experience.

Points will be awarded for each qualifying year of experience as follows:

Number of Years’ Experience Possible Points

1 Year to 3 Years 2 Points

3.1. Years to 6 Years 4 Points

c. Key Staff Desirable Qualifications (KSDQ)

The Proposer must complete Attachment 20, Key Staff Qualifications, KSDQ tab to qualify for additional points.

1) Key staff has experience conducting State government, local government, special districts, and/or local education agency audits, preferably in California or similar regulatory environments, in accordance with Generally Accepted Government Auditing Standards (GAGAS) or Yellow Book.

Points will be awarded to each key staff for each qualifying year of experience as follows:

Number of Years’ Experience Possible Points

5.1 Years to 6 Years 3 Points

6.1. Years to 7 Years 4 Points

7.1 Years to 8 Years 5 Points

8.1 Years to 9 Years 6 Points

9.1 Years to 9.9 Years 7 Points

10 Years or More 8 Points

2) Key staff has at least one year experience with auditing large payment datasets (e.g., Medi-Cal, SNAP/CalFresh/WIC).

Points will be awarded to each key staff for each qualifying year of experience as follows:

Number of Years’ Experience Possible Points

1 Year to 3 Years 2 Points

3.1. Years to 6 Years 3 Points

6.1 Years to 9 Years 4 Points

9.1 Years or more 6 Points

3) Key staff member has at least one year of experience using analytics tools such as Arbutus, IDEA, SQL, Python, etc. for large datasets.

Points will be awarded to each key staff for each qualifying year of experience as follows:

Number of Years’ Experience Possible Points

1 Year to 3 Years 2 Points

3.1. Years to 6 Years 3 Points

9.1 Years or more 6 Points

4) Key staff member has at least one year of fraud detection or forensic audit experience.

Points will be awarded to each key staff for each qualifying year of experience as follows:

1 Year to 3 Years 2 Points

3.1. Years to 6 Years 3 Points

9.1 Years or more 5 Points

5) Key staff member possesses a Certified Internal Auditor (CIA), Certified Fraud Examiner (CFE), or Certified Information Systems Auditor (CISA) License.

Points will be awarded to each key staff that possesses a qualified license. Max possible points awarded for this KSDQ will be five regardless of how many qualifying licenses that a key staff may possess.

Description Possible Points

Yes (Must submit a copy of the CIA, CFE, or CISA license)

5 Points

d. Proposer Guarantee

The Proposer shall provide a Letter of Guarantee explaining their ability to perform the services identified in Standard Agreement, Exhibit A, Scope of Work and includes:

1) A statement expressing the Proposer’s availability of staff and other required resources, including audit staff, to successfully perform all tasks and deliverables as described in this RFP.

2) A statement expressing the Proposer’s strong commitment to establishing, maintaining, and supporting diversity in its ownership and professional staff members.

3) A statement expressing the Proposer’s willingness to comply with the terms and conditions of this agreement.

4) A signature from an individual who is authorized to bind the Proposer contractually to certify that the Proposer guarantees their ability to perform the services as identified in this RFP.

5) A statement guaranteeing that the Proposer will meet all requirements under GAGAS/Yellow Book.

e. Firm’s Organizational and Operational Background

1) Organizational Structure

List the name and classification of each proposed key staff member and identify who will be assigned to each of the tasks and deliverables identified in Standard Agreement, Exhibit A, Scope of Work.

2) Operational Background

i. Describe the usual process for interface with the client and the communication plan for completing the tasks and deliverables under this agreement including:

The firm’s chain of command Who is the individual with overall responsibility for the firm’s operations?

What will be the role of each proposed key staff member?

What will be the role of the audit staff?

What will be the role of the support staff?

ii. Identify subcontractor’s (if applicable). Include qualifications, reporting responsibility of each firm and/or person assigned to each task and method of monitoring performance.

iii. List the number of years the firm has provided auditing services.

f. Include two Sample Audit Reports relevant to RFP Section B, 1 – Proposer Firm Minimum Qualifications, Item c.

i. One Performance Audit Sample

ii. One Financial Audit Sample

g. Understanding and Approach

The Proposer shall provide a summary of the work to be completed as understood, the goals and objectives to complete the requisite tasks, the resources necessary to achieve these outputs, the actions to be taken or strategy to be utilized to achieve these outcomes, and a timeline or schedule to complete the Agreement requirements as identified in this RFP. The response will be scored based on the comprehensiveness and detail provided.

The narrative response must be single spaced, Arial font 12, and no longer than 10 pages. If a response is longer than ten pages, only the first ten pages will be reviewed and scored.

The plan of how audit services will be provided shall include:

1) List standard services provided in a typical auditing engagement.

2) List similar types of agreements, successfully concluded, with a sample of such work.

3) Identify subcontractor’s (if applicable). Include qualifications, reporting responsibility of each firm and/or person assigned to each task, and method of monitoring subcontractor performance.

h. Proposer Firm References

1) The Proposer shall provide three current references for similar type of services performed within the last five years on Attachment 20, Proposer References. Attachment 21, Proposer Firm References must be completed in its entirety. At least one reference must be from experience used to meet the Firm Minimum Qualifications.

2) References will be contacted to validate ratings. SCO will make up to three attempts via phone/email to validate references. Failure to reach a listed reference will result in the ratings being scored zero and the Proposal may be deemed non-compliant and disqualified in its entirety. References will be scored based on the accumulative average score provided by the three references listed on Attachment 21, Proposer Firm References.

i. Key Staff References

1) The Proposer shall provide three current references for each of the proposed key staff for similar types of services performed within the last five years on Attachment 22, Key Staff References. Attachment 22, Key Staff References must be completed in its entirety. At least one reference must be from experience used to meet Key Staff Minimum Qualifications.

2) References will be contacted to validate ratings. SCO will make up to three attempts via phone/email to validate references. Failure to reach a listed reference will result in the ratings being scored zero and the Proposal may be deemed non-compliant and disqualified in its entirety. References will be scored based on the accumulative average score provided by the reference contacts listed on Attachment 22, Key Staff References.

D. Submission of Proposal

1. Proposals must be submitted as set forth below.

a. Proposers must submit their proposal (Technical Proposal and Cost) in portable document format (PDF) and Minimum Qualifications in an Excel workbook attached to an email to SCOBids@sco.ca.gov prior to the date and time specified in Section C, Proposal Requirements and Information, Item 1. Key Action Dates. Subject line must include the RFP EAUF90126 – Auditing Services.

b. Email Requirements:

1) Proposers must ensure that emails do not exceed a file size of 20 megabytes.

2) Proposers must ensure that emails do not contain scripts, executable files, password protections, or macros, which may make their emails undeliverable.

3) Do not imbed links within the PDF—all documents must be contained within the PDF and/or Excel workbook. SCO cannot access links to external sources. Proposals containing links to external sources will be rejected.

4) If the email should exceed acceptable file size, the Proposer shall split the email into multiple emails to ensure delivery.

5) Proposal submissions that are sent from unrecognized email servers may be blocked by SCO security filters and be flagged as spam, thereby rendering them not submitted.

6) An automatic reply from SCOBids@sco.ca.gov confirms receipt of proposers’ emails. Automatic replies only confirm receipt of emails and do not assess proposers’ responsiveness to the RFP requirements in the email content or in any attachments therein.

7) PROPOSAL SUBMISSIONS RECEIVED AFTER THE DEADLINE IN THE KEY ACTION

DATES WILL NOT BE ACCEPTED—NO EXCEPTIONS.

c. Proposals not marked as indicated may be rejected.

d. If the Proposal is made under a fictitious name or business title, the actual legal name of the Proposer must be provided.

e. All proposals shall include the documents identified in Attachment 1, Required Attachment Checklist. Proposals not including the proper "required attachments" may be deemed non-responsive. A non-responsive proposal is one that does not meet the basic proposal requirements.

f. All documents requiring a signature must bear a signature of a person authorized to bind the proposing firm.

g. Proposals must be submitted for the performance of all the services described herein. Any deviation from the work specifications will not be considered and will cause a proposal to be rejected.

h. SCO may reject any or all proposals. A proposal may be rejected if it is conditional or incomplete, or if it contains any alterations of form or other irregularities of any kind.

i. SCO may waive an immaterial deviation in a proposal. SCO waiver of an immaterial deviation shall in no way modify the RFP document or excuse the Proposer from full compliance with all requirements if awarded the Agreement.

j. Costs incurred for developing proposals and in anticipation of award of the Agreement are entirely the responsibility of the Proposer and shall not be charged to the State of California.

k. An individual who is authorized to bind the Proposer contractually shall sign Attachment 2, Proposal/Proposer Certification Sheet. The signature should indicate the title or position that the individual holds in the firm. An unsigned proposal shall be rejected.

l. A proposer may modify a proposal after its submission by withdrawing its original proposal and resubmitting a new proposal prior to the Final Date for Proposal Submissions. A proposer’s modification offered in any other manner, oral or written, will not be considered.

m. A proposer may withdraw its proposal by submitting a written withdrawal request to SCO, signed by the Proposer or an authorized agent. A proposer may thereafter submit a new proposal prior to the Final Date for Proposal Submission. Proposals may not be withdrawn without cause subsequent to the Final Date for Proposal Submission.

n. SCO may modify the RFP prior to the Final Date for Proposal Submission by issuing an addendum that shall be posted to Cal eProcure.

o. SCO reserves the right to reject all proposals. SCO is not required to award an agreement.

p. SCO does not accept alternate agreement language from a prospective contractor. A proposal with such language will be considered a counterproposal and will be rejected. The State’s General Terms and Conditions (GTC 02/2025) are not negotiable.

q. No oral understanding or agreement shall be binding on either party.

E. Evaluation Process

1. The evaluation process complies with the requirements for competitive bidding in California Public Contract Code (PCC) Section 10344. Each proposal will be evaluated to determine responsiveness to the requirements and standards described in this RFP. SCO cannot assume nor infer qualifications, skill, experience, or competence not specifically and expressly addressed in the Proposal. During the evaluation and selection process, SCO may wish to interview a proposer for clarification only. SCO also reserves the right, at its sole discretion, to forgo the interview process. If SCO elects not to conduct interviews, all responsive and responsible proposals that advance to the technical evaluation stage shall receive the maximum points allocated for the interview component.

2. Proposals cannot be changed after the time and date designated for receipt.

3. Proposals that contain false or misleading statements, or which provide references, which do not support an attribute or condition claimed by the Proposer, may be rejected.

4. A responsive proposal is one which meets or exceeds the requirements stated in this RFP. At the time of proposal opening, each proposal will be checked for the presence or absence of required information in conformance with the submission requirements of this RFP, proposals that meet the minimum qualifications will be evaluated and scored according to the criteria indicated in the following process:

a. Preliminary Review

1) Proposals shall be date/time stamped upon receipt.

2) Proposals will be reviewed to verify that submission is in a single PDF and Excel workbook, when applicable, are properly identified, and received on or before the final filing date and time specified in Section C. Proposal Requirements and Information, 1. Key Action Dates.

3) Proposals shall remain sealed until after Final Date for Proposal Submission.

4) Proposal will be reviewed to determine completeness of required documentation and compliance as identified in this RFP. SCO staff will use the Attachment 1, Required Attachments Checklist, submitted by the Proposer to confirm receipt of all required documents.

5) Proposal requirements will be evaluated on a “pass/fail” basis for all criteria and information.

6) SCO may reject any or all Proposals that fail to meet these requirements.

b. Minimum Qualification Evaluation

Upon satisfactory Preliminary Review, the Technical Proposal will be reviewed to determine the Proposer’s satisfaction of the Minimum Qualifications requirements. For Proposals that satisfy the Minimum Qualifications, the Technical Proposal will be evaluated by a team of SCO Staff (Evaluation Team).

c. Technical Proposal Evaluation and Scoring

The Evaluation Team will independently evaluate each Proposer’s Technical Proposal using the Proposal evaluation criteria as stated in Section E. Evaluation Process, Item 4.f, Evaluation Worksheet.

Each proposal shall be awarded points based on the maximum points available in each category, for a maximum total of 863 possible points. Evaluation will emphasize the Proposer’s experience, qualifications, and references, as well as the experience and qualifications of the key staff assigned to SCO. The Technical Proposal should provide the detail, clarity, completeness, relevance, and appropriateness of the experience as it relates to the needs of SCO as stated in this

RFP.

Once individual scoring has been completed, team members will determine a single score for each Proposers Technical Proposal upon consensus of the Evaluation Team.

d. Cost Assessment and Scoring

i. The Evaluation Team will review the Cost Proposal Worksheets to verify mathematical accuracy and determine if there are any deviations in the proposal. If a deviation is material, it may be cause for rejection. Immaterial deviations will be processed as if no deviation had occurred.

ii. Cost Proposal Worksheets shall be evaluated and scored based on the total proposal cost for the term of the Agreement.

iii. The Proposer with the lowest Hourly Rate will be awarded the maximum number of points available (863 points), which the Technical Proposal score is 58 percent (504 points), the interview score is 12 percent (100 points), and the cost score is 30 percent (259 points).

a) If SCO, in its sole discretion, elects not to conduct interviews, all responsive and responsible proposals that advance to the technical evaluation stage shall receive the maximum points available for the interview component.

iv. The Proposer’s cost score will be based on a proportional number of points as it relates to the average hourly rate associated with the responsive proposal with the lowest average hourly rate multiplied by the maximum number of cost points.

v. The following formula shall be used to determine cost points: (Example)

Lowest Proposer’s Average Hourly Rate ($260.00) X maximum cost points (259) divided by other Proposer’s Average Hourly Rate = cost points awarded to the other Proposer.

LOWEST AVERAGE HOURLY RATE ($260.00) X 259 HOURLY RATE POINTS AVAILABLE

OTHER PROPOSER’S AVERAGE HOURLY RATE

COST POINTS AWARDED TO OTHER PROPOSAL

Table 1. Sample Cost Assessment

Proposer Average Hourly Rate

Calculation

POINTS

AWARDED

A $275.00 $260.00 (Proposer B) X 259 (weight) / $275.00 (Proposer A) 245*

B $260.00 $260.00 (Proposer B) X 259 (weight) / $260.00 (Proposer B) 259

C $310.00 $260.00 (Proposer B) X 259 (weight) / $310.00 (Proposer C) 217*

* Standard rounding rules shall apply.

e. Selection

Award will be made to the highest scoring, responsive and responsible proposer.

f. Evaluation Worksheet

The Evaluation Worksheet details the evaluation and scoring criteria. The Evaluation Worksheet will be found on the following pages for your reference.

EVALUATION WORKSHEET

Name of Proposer: ______________________________________________

Evaluator: ________________________________ Date: ________________

A. Administrative Evaluation

Description Pass/Fail

Proposal received by the date and time specified in the RFP.

All applicable attachments identified on Attachment 1, Required Attachment Checklist were completed and submitted.

Proposer Guarantee included in proposal package as specified in RFP.

Firm’s Organizational and Operational Structure included in the proposal package as specified in the RFP.

Firm’s two Audit samples.

Firm’s Understanding and Approach included in the proposal package as specified in the RFP.

Proposer firm references included in the proposal package as specified in the RFP.

Proposed Key Staff references included in the proposal package as specified in the RFP.

B. Minimum Qualification Evaluation

Proposer Firm

The Proposer must be licensed as an active Certified Public Accounting (CPA) firm in good standing. The Proposer must submit a copy of CPA certificate of license.

The Firm must have at least five years’ experience, within the last eight years, performing audit services described within this RFP and Exhibit A.

The Proposer must have a minimum of five years of experience conducting State government, local government, special districts, and/or local education agency audits, preferably in California or similar regulatory environments, in accordance with Generally Accepted Government Auditing Standards (GAGAS) or Yellow Book. Qualifying experience may be comprised of:

1. GAGAS/Yellow Book

2. California public sector audits

3. Local education agency and local government financial, compliance, and performance audits

4. Proved ability to conduct performance audits and complex data analysis

5. Experience working with large datasets and public program payment systems

6. Strong quality control system and peer review process

The Proposer must have completed a peer review within the last three years with a rating of “pass” (or equivalent). Proposer must submit a copy of the peer review report and any related management letter, if applicable.

Proposer Key Staff

Proposed Key Staff #1 – Engagement Partner (EP)/ Project Director (PD) (1 KS)

1. Must have an active CPA License

2. Must have a minimum of 10 years of audit experience in State government, local government, special districts, or local education agency audits, preferably in California or similar regulatory environments

3. Must have at least five years’ experience managing audit teams conducting performance and financial audits of complex public programs in accordance with GAGAS

4. Must have a bachelor’s degree in accounting, finance, or business

Proposed Key Staff #2 – Audit Manager (AM) (3 KS)

1. Must have an active CPA License

2. Must have a minimum of seven years of audit experience in State government, local government, special districts, or local education agency audits, preferably in California or similar regulatory environments

3. Must have a minimum of five years’ experience supervising audit teams conducting performance and financial audits of complex public programs in accordance with GAGAS

4. Must have a bachelor’s degree in accounting, finance, or business

Proposers must receive a “Pass” for the Minimum Qualifications to have the remaining Technical Proposal evaluated. If the Proposer did not receive a “Pass” for the Minimum Qualifications the Proposal is considered non-responsive and is therefore disqualified.

C. Technical Proposal Evaluation and Scoring

1. Proposer Firm Desirable Qualifications

Proposer Firm Desirable Qualifications (FDQs) is optional and if submitted, will be assessed and scored up to a maximum score of 34 points. FDQs will be assessed and scored only for proposals that pass the Pass/Fail components. Each Proposer that meets a qualifying FDQ will be awarded points based on a scale commensurate with its demonstrated years of experience.

Awarded scores will be summed to become the FDQ Score. FDQs are not required to be met to continue in the assessment process.

Firm Desirable Qualifications Scoring Example:

Proposer Desirable Qualification Description Maximum

Points Points Scored

The Proposer must have a minimum of five years of experience conducting State government, local government, special districts, and/or local education agency audits, preferably in California or similar regulatory environments, in accordance with Generally Accepted Government Auditing Standards (GAGAS) or Yellow Book. Points will be awarded for each qualifying year of experience beyond five years.

Number of Years’ Experience Possible Points

5.1 Years to 6 Years 5 Points

6.1. Years to 7 Years 6 Points

7.1 Years to 8 Years 7 Points

8.1 Years to 9 Years 8 Points

9.1 Years to 9.9 Years 9 Points

10 Years or More 10 Points

The Proposer has experience with auditing large payment datasets (e.g., Medi-Cal, SNAP/CalFresh, WIC).

Number of Years’ Experience Possible Points

1 Year to 3 Years 2 Points

3.1. Years to 6 Years 4 Points

The Proposer has experience using analytics tools such as Arbutus, IDEA, SQL, Python, etc. for large datasets.

Number of Years’ Experience Possible Points

1 Year to 3 Years 2 Points

3.1. Years to 6 Years 4 Points

The Proposer has fraud detection or forensic audit experience.

1 Year to 3 Years 2 Points

3.1. Years to 6 Years 4 Points

Max FDQs Points Score (sum all scores) 34

2. Key Staff Desirable Qualifications

Key Staff Desirable Qualifications (KSDQs) is optional and if submitted, will be assessed and scored up to a maximum score of 120. KSDQs will be assessed and scored only for proposals that pass the Pass/Fail components. Each Key Staff that meets a KSDQ will be awarded up to the maximum points for each qualifying experience. Awarded scores will be summed to become the KSDQ Score. KSDQs are not required to be met to continue in the assessment process.

Staff Desirable Qualifications Scoring Example:

Proposer A

KSDQ

KSDQ

KSDQ

KSDQ

KSDQ

Maximum

Points Points Scored

Category 1, Key Staff #1 8 6 6 5 5 30

Category 2, Key Staff #1 8 6 6 5 5 30

Category 2, Key Staff #2 8 6 6 5 5 30

Category 2, Key Staff #3 8 6 6 5 5 30

Max Staff Desirable Qualifications Score (sum all scores) 120

3. Proposer Guarantee

Information Proposer Provided Indicates

Points Points Scored

Insufficient Information Provided 0 Partial Information Provided 10 Comprehensive Information Provided 25

Total Points 25

4. Firm’s Organizational Structure and Operational Background

a. Organizational Structure

Information Proposer Provided Indicates Maximum Points

Points Scored

Insufficient Information Provided 0 Sufficient Information Provided 10

Comprehensive Information Provided 25

Total Points 25

b. Operational Background

Points Scored

Insufficient Information Provided 0 Sufficient Information Provided 25 Comprehensive Information Provided 50

Total Points 50

Total Points for Firm’s Organizational Structure and Operational Background

Maximum Points

Points Scored

a. Organizational Structure 25

b. Operational Background 50

Total Points 75

5. Two Audit Samples

a. One Performance Audit Sample

Points Scored

Insufficient Information Provided 0

Sufficient Information Provided 25

b. One Financial Audit Sample

Points Scored

Insufficient Information Provided 0

Sufficient Information Provided 25

Total Points for Firm’s Audit Samples

Points Points Scored

a. Performance Audit Sample 50

b. Financial Audit Sample 50

Total Points 100

6. Firm’s Understanding and Approach

Points Scored

Insufficient Information Provided 0 Sufficient Information Provided 30

7. Proposer Firm References

The Proposer shall provide three references for similar types of services performed within the past five years on Attachment 21, Proposer Firm References. References shall substantiate the Proposer’s expertise and experience in providing services. Include the name and current telephone number of the reference contact person(s). References will be scored based on the average score of the Performance Ratings (PR) provided by the reference contacts listed on Attachment 21, Proposer Firm References.

Proposer Firm Reference Form Scoring Example:

Proposer A PR1 PR2 PR3 PR4 PR5

Points Points Scored

Firm Reference #1 10 10 10 10 10 50*

Firm Reference #2 10 10 10 10 10 50

Firm Reference #3 10 10 10 10 10 50

Subtotal (sum all reference scores) 150

Firm Reference Score (subtotal ÷ # of references) 150÷3=50

*Average ratings resulting in a decimal will be rounded to the nearest whole number.

8. Proposed Key Staff References

The Proposer shall provide three references per each of the 16 proposed key staff for similar types of audit services performed within the past five years on Attachment 22, Key Staff References.

References shall substantiate the Proposed Key Staff’s expertise and experience in providing services. Include the name, email address, and a current telephone number for each reference contact person(s). References will be scored based on the average score of the Performance Ratings (PR) provided by the reference contacts listed on Attachment 22, Key Staff References.

Key Staff Reference Form Scoring Example Proposer A, Category 1, Key Staff #1

PR1 PR2 PR3 PR4 PR5 Score

Reference 1 10 10 10 10 10 50 Reference 2 10 10 10 10 10 50 Reference 3 10 10 10 10 10 50 Proposer A, Category 2, Key Staff #1

PR1 PR2 PR3 PR4 PR5 Score

Reference 1 10 10 10 10 10 50 Reference 2 10 10 10 10 10 50 Reference 3 10 10 10 10 10 50 Proposer A, Category 2, Key Staff #2

PR1 PR2 PR3 PR4 PR5 Score

Reference 1 10 10 10 10 10 50 Reference 2 10 10 10 10 10 50 Reference 3 10 10 10 10 10 50 Proposer A, Category 2, Key Staff #3

PR1 PR2 PR3 PR4 PR5 Score

Reference 1 10 10 10 10 10 50 Reference 2 10 10 10 10 10 50 Reference 3 10 10 10 10 10 50

Subtotal (sum all reference scores) 200

Key Staff Reference Score (Subtotal ÷ # of references) 200 ÷ 4 =

50* *Average ratings resulting in a decimal will be rounded to the nearest whole number.

9. Interviews

Proposer’s key staff will be required to appear for an interview with SCO via Microsoft Teams.

Interview Questions

Possible Points

Points Scored

Interview Score 100

10. Total Score

Description

Possible Points

Points Scored

Proposer Firm Desirable Qualifications 34

Key Staff Desirable Qualifications 120

Proposer Guarantee 25

Firm’s Organizational and Operational Background 75

Firm’s Two Audit Samples 100

Firm’s Understanding and Approach 50

Proposer Firm References 50

Key Staff References 50

Technical Proposal Score 504

Interview Score 100

Cost Proposal Score 259

Total Score 863

COMMENTS:

► End of Evaluation Worksheet ◄

F. Award and Protest

1. Notice of the Proposed award shall be posted for five working days prior to awarding the Agreement in a place accessible by the general public on the California State Contracts Register, Cal eProcure Event page: https://caleprocure.ca.gov/pages/Events-BS3/event-search.aspx

2. If any proposer, prior to the award of the Agreement, files a protest with the SCO and the Department of General Services (DGS), Office of Legal Services (OLS), 707 Third Street, 7th Floor, Suite 7-330, West Sacramento, CA 95605 or OLSProtests@dgs.ca.gov, on the grounds that the (protesting) proposer would have been awarded the Agreement had the SCO correctly applied the evaluation standard in the RFP, or if the SCO followed the evaluation and scoring methods in the RFP, the Agreement shall not be awarded until either the protest has been withdrawn or the DGS has decided the matter. It is suggested that you submit any protest by certified or registered mail.

3. Within five days after filing the protest, the protesting proposer shall file with the DGS, OLS and the

SCO, a detailed statement specifying the grounds for the protest. The written protest must be sent to DGS OLS, 707 Third Street, 7th Floor, Suite 7-330, West Sacramento, CA 95605 or OLSProtests@dgs.ca.gov. A copy of the detailed written statement must be emailed to SCO, at SCOBids@sco.ca.gov, Attention: Contracts Office

G. Disposition of Proposals

1. Upon proposal opening, all documents submitted in response to this RFP will become the property of the State of California and will be regarded as public records under the California Public Records Act (GC Section 6250 et seq.) and subject to review by the public.

H. Agreement Execution and Performance

1. The Agreement will be executed only upon SCO acceptance of all documents required by this RFP.

The Agreement is attached and by virtue of submitting a proposal, the Proposer agrees to the terms and conditions stated herein.

2. Service shall start no sooner than the Agreement start date specified in Section C, Proposal Requirements and Information, 1. Key Action Dates, or on the express date set by SCO and the Contractor, after all approvals have been obtained and the Agreement is fully executed. Should the Contractor fail to commence work at the agreed upon time, SCO, upon five days written notice to the Contractor, reserves the right to terminate the Agreement. Commencement of work prior to final approval of the Agreement is at the risk of the Contractor. The Contractor may not receive any payment for work performed prior to final approval of the Agreement.

3. All performance under the Agreement shall be completed on or before the termination date of the

Agreement.

I. Participation Preference and Incentive Programs

The Small Business Preference and DVBE Incentive Programs listed below may be combined but will not exceed a combined total of 15 percent of the Proposal max total of 863 or 129 points per proposal, whichever is less. No proposal score will be increased by more than 129, and all preference and incentive cost adjustments are for proposal evaluation purposes only.

A Small Business (SB)/Microbusiness (MB) and/or a Disabled Veteran Business Enterprise (DVBE) must have current and valid certification through DGS, Office of Small Business and Disabled Veteran Business Enterprise Certification Services (OSDS). Completed certification applications and required support documents must be submitted to OSDS no later than 5:00 p.m. PT on the Final Date for Proposal Submission and OSDS must be able to approve the application as submitted.

For certification and preference approval process information, contact OSDS by telephone at (916) 375- 4940 or access OSDS Internet website at…