Audit Committee Memorandum

To: Board of Representatives
From: Ona Alston Dosunmu
Re: Audit Committee
Date: June 2019

Our Bylaws (Article V, Section 4) provide that for any tax year in which we hold any property for charitable purposes and have gross revenues of $2 million or more, we shall have an Audit Committee. The Bylaws further reference Section 12586(e)(2) of the California Government Code (attached for your reference). Given the establishment of the California Lawyers Foundation and our commitment to provide initial funding to the Foundation, we meet the conditions. Further, having a financial audit is a best practice for an organization of CLA’s size and complexity. After discussions with our Board Chair, Jim Hill, and the individuals named below, I recommend the establishment of an Audit Committee comprised of:

• Brian Arbetter,
• Rinat Klier-Erlich, and
• Paul Riehle

The Audit Committee may expand upon the basic responsibilities described in this memorandum and adopt a charter to govern its activities (or the board may assign additional duties to the Audit Committee at some point in the future), but its core responsibilities shall be as follows:

• With administrative support from staff, issue a request for proposals from certified public accounting firms. (In considering firms to which to send the RFP, the committee may consider suggestions from the Association’s CFO, Treasurer or other staff but must ultimately make its own decisions regarding which firms to invite to bid, as independence both in fact and appearance is of utmost importance);
• Upon receipt of proposals, review proposals and with administrative support from staff, if needed, invite no fewer than three finalists to interview with the committee;
• Select the audit firm;
• Review and execute the engagement letter with the auditors;
• Confer with the auditors throughout the audit as needed;
• Receive the audit and management’s response to the audit (if any);
• Meet with the auditors in executive session with no staff present;
• Present the audit to the Board; and
• To the extent the audit uncovers any deficiencies or material weaknesses, ensure that CLA satisfactorily addresses them.