HomeMy WebLinkAboutDiamond Bar Proposal Memo - Fee Increase
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Memo: Audit Fee Proposal for Future Years
Explanation of Significant Increase in Proposed Audit Fees
To: City Council and Management
From: Christian Townes, Partner, LSL, LLP
Date: 10/21/2025
Subject: External Audit Fee Proposal – Rationale for Significant Increase
As part of our continued commitment to providing high-quality audit services to the City of Diamond Bar (the City), we have
submitted a proposal for external audit services for future fiscal years. You may notice that the proposed audit fees for these
years represent a significant increase compared to our prior proposal, particularly for the City’s financial statement audit.
The purpose of this memorandum is to provide a transparent explanation of the key factors contributing to this change and
to address any questions or concerns you may have.
Factors Driving the Increase in Audit Fees
1. Expanded Regulatory Requirements:
Since the prior accepted proposal, there have been changes in regulatory standards and increased expectations
for audit procedures. Enhanced scrutiny and expanded procedures are now required to ensure compliance, which
has led to greater resource allocation from our team.
2. Investment in Technology and Expertise:
To better serve our clients, we have invested in advanced audit technologies and specialized staff training. While
these improvements enhance audit quality and efficiency, they also result in higher costs that are reflected in our
fees.
3. Inflation and Market Adjustments:
General inflationary pressures, as well as adjustments to market rates for professional services, have necessitated
a review and update of our pricing structure.
Commitment to Value and Transparency
We remain committed to delivering exceptional value and maintaining open communication regarding our fee structure. The
proposed fee increase is directly tied to the resources and expertise required to uphold audit integrity and meet the evolving
needs of the City. We are confident that our approach will continue to support your organization’s objectives and regulatory
compliance.
A discount of 20% has been applied to the proposed audit fees in acknowledgment of the established working relationship
with the City and the team's responsiveness. Additionally, the same fee structure will be offered through fiscal year 2028.
Should you have any questions or require further clarification regarding the proposed fees, please do not hesitate to contact
me directly. We appreciate your trust in our firm and look forward to our continued partnership.
Sincerely,
Christian Townes
Christian.Townes@lslcpas.com