PORT OF SEATTLE 
MEMORANDUM 
AUDIT COMMITTEE AGENDA              Item No. 
Date of Meeting       May 3, 2011 
DATE:      April 22, 2011 
TO:       Tay Yoshitani, Chief Executive Officer 
FROM:     Dan Thomas, Chief Financial & Administrative Officer 
Rudy Caluza, Director, Accounting & Financial Reporting 
Lisa Lam, Senior Manager, Financial Reporting & Controls 
SUBJECT:   Selection of External Audit Services for the Financial Statement, Single
Audit (federal grant compliance) and Passenger Facility Charge Audit for 
the Port's 2011 to 2013 Operating Periods with two-year optional renewal 
Amount of This Request: Not to exceed $3,000,000 
Source of Funds: AFR operating budget & Portwide non-opearating budget 
Estimated Workers Employed: 10 to 15 
ACTION REQUESTED: 
Review and recommend to the Commission, based on an open competitive process, the
external independent auditors to be selected to audit the financial statements and the federal
grant and Passenger Facilities Charge ("PFC") programs of the Port of Seattle 
SYNOPSIS: 
Annual independent audits are required for the financial statements of the Port's Enterprise
Fund and the Warehousemen's Pension Trust Fund for purposes of obtaining an independent
auditors opinion as to the fairness in presentation of the financial results and position. 
Independent audits are also required for the Port's administration of federal grants and PFC
revenues in accordance with applicable regulations. These audits have been covered under
the existing external audit services contract is expiring in April 2011 once the 2010 audit
services are completed.

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
April 28, 2011 
Page 2 of 3 

The annual external audit services include the following deliverables: 
Independent Audit and Opinion - Financial Statements of the Port's Enterprise Fund 
Independent Audit and Opinion - Financial Statements of the Warehousemen's
Pension Trust Fund 
Independent Audit and Opinion  Net Revenue Available for Revenue Bond Debt
Service 
"Single Audit" and Report of Federal Grants Awarded 
PFC Program Audit and Report 
As it has in the past, the Port intends to openly and competitively select the external auditor.
The Request for Qualification ("RFQ") incorporating the evaluation criteria were reviewed
and approved by the Audit Committee on February 1, 2011 Meeting. The RFQ process from
drafting, advertising to evaluation is led by the Central Procurement Office ("CPO") and
observed by the Director of Internal Audit in accordance with Resolution No. 3628.
Four national public accounting firms submitted proposals to RFQ in March 2011. The four
proposals were evaluated vigorously against the pre-determined evaluation criteria (200
points) in the RFQ by four evaluators from Accounting and Financial Reporting ("AFR"),
Seaport & Real Estate Finance & Budget, and Aviation Finance & Budget Departments with
the presence of CPO representative and observed by the Director of Internal Audit
throughout. 
Two finalists, KPMG and Moss Adams, were selected for interviews. The other two firms
were not selected for the interview due to the following reasons: 
Proposed audit hours are much higher, about 900 hours more than the average of the
other 3 bidders proposed 
Delivery of audit reports are either later than the other bidders or unspecified 
Unable to clearly relate the current and past experience to the Port of Seattle's scope
of work 
Missing key engagement team member(s) specifically senior auditors' current and
past experience information 
Unable to provide example of audit reports in each specified audit areas 
Presented inaccurate information such as audit timeline or reference to regulatory
requirements 
Eight interview questions with 100 points were developed by the four evaluators and
reviewed by CPO representative and the Director of Internal Audit. One-hour interview was
conducted and led by CPO representative with the four evaluators and the presence of the
Director of Internal Audit and Office of Social Responsibility ("OSR") Compliance Manager.
Each firm is allowed to bring six representatives without any handout or presentation
material.

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
April 28, 2011 
Page 3 of 3 

The two finalists were evaluated vigorously against the pre-determined interview evaluation
criteria by the same four evaluators with the concurrence of CPO representative and the
Director of Internal Audit. As a result, Moss Adams is the highest ranked proposer based on
both the submittal scores and interview scores. Summary of the overall all strengths of the
highest ranked proposal and interviews are as follows: 
All audit reports are to be delivered by April 30 if all information is provided on time 
If management is unable to provide all requested information on schedule, the firm is
committed to deliver audit report 2 weeks after fieldwork 
5% more proposed partner audit hours compared to the other finalist 
Well presented information of the current and past experience on the key audit
engagement team members from partners level to senior auditors level to the Port of
Seattle's scope of work 
Able to present example of audit reports in each specified audit areas 
No extra fee charges to incorporate audited financial statements in bond offering
documents 
Reasonable fee proposed for the Warehousemen's Pension Trust Fund 
Specific and relevant examples were provided when asked how to handle difficult
situations with auditee 
SOURCE OF FUNDS: 
The total audit fees estimated by all proposers for all five years are under $3,000,000. The fee
for the 2011 audit services, which is conducted during latter 2011 and first half of 2012, is
included in the AFR department's 2011 approved budget and will be included in the 2012
AFR proposed operating budgets, and in non-operating budget as appropriate. The funding
sources are approximately 55% and 45%, respectively. For audit services in 2012  2015, the
funds will be in the Port's annual budget. 
STRATEGIC OBJECTIVES: 
Be a high performance organization: Being transparent and accountable of public
funds and timely reporting on Port's financial results and be in full compliance with
federal regulations. 
TRIPLE BOTTOM LINE: 
The RFQ for external audit services has incorporated the Port's "Small Business
Initiative" goals per guidance from the OSR to allow at least 10% of subcontracting work
with small businesses. 
PREVIOUS AUDIT COMMITTEE ACTION: 
2/1/2011  Approved External Independent Audit RFQ