O’Fallon takes first step to refine city external audit protocol

An external audit is a review of a city’s financial records and accounts by an external auditor who is not an employee of the municipality. The purpose is to ensure the municipality’s finances are being managed properly and the annual accounts are accurate.

For about 19 years, the City of O’Fallon has used the same firm (after a merger of two firms) to conduct its external audit, and also has used the same managing/lead partner to oversee those audits of the city.

As part of the 2025 city budget process and after obtaining three competitive bids, city staff recommended using that same firm again for at least two years, because they were the lowest and best bidder.

At its Oct. 24 meeting, the City Council considered a resolution to approve an auditing agreement with Sikich, an accounting and auditing firm in St. Louis County. The bid included a price of $49,700 for the first year and $51,400 for the second year, then $53,300 for an optional third year extension, $55,300 for an optional fourth year extension, and $57,400 for an optional fifth year extension.

Prior to a vote, council member Linda Ragsdale (Ward 5) said that from her experience she believed it best to use a different firm after five or ten years, to have fresh eyes doing the external audits. She moved to amend the resolution to, instead, designate the second-lowest bidder (price would be about $8,000 more for the first year). By voice vote, the council voted against that amendment.

Council member Dr. Jim Ottomeyer (Ward 4), then moved for a different amendment, to keep Sikich as the audit firm, but with the stipulation that a different managing/lead partner be named to oversee the city’s audit.

Ottomeyer also said he would pursue using a future City Council Workshop to craft a bill to do this type of change every so many years.

By voice vote, the council voted to approve Ottomeyer’s amendment, then voted to approve the resolution as amended, using Sikich as the external auditor but with a different managing/lead partner.

In a related matter, Oct. 24 was the first meeting where resolutions for items previously approved through the budget process could be placed in the City Council’s Consent Calendar for final approval en masse, instead of voting on each resolution separately. Any council member still can elect to move an item out of the Consent Calendar and discuss/vote on it individually. The resolution for the external audit agreement was the first one presented as part of the Consent Agenda. Ragsdale had asked for it to be pulled out and considered separately.