RFP: External Quality Assessment of the Internal Audit Division

LOS ANGELES COUNTY EMPLOYEES RETIREMENT ASSOCIATION
REQUEST FOR PROPOSAL (RFP)
EXTERNAL QUALITY ASSESSMENT OF THE INTERNAL AUDIT DIVISION
JUNE 26, 2026
1. INTRODUCTION
1.1. Purpose of Request
The Los Angeles County Employees Retirement Association (LACERA) is seeking proposals
from qualified firms to perform an External Quality Assessment (EQA). The EQA shall include
benchmarking activities and the identification and reporting of leading practices to enhance the
efficiency and effectiveness of LACERA's Internal Audit function in accordance with The
Institute of Internal Auditors' Global Internal Audit Standards, effective January 2025.
The EQA shall evaluate the Internal Audit Division's conformance with the Global Internal Audit
Standards, including the Purpose of Internal Auditing; Ethics and Professionalism; Governing
the Internal Audit Function; Managing the Internal Audit Function; and Performing Internal
Audit Services. The EQA shall include a review of governing documents, policies, procedures,
methodologies, selected audit workpapers, reports, quality assurance activities, and other
evidence of conformance. The IIA Quality Assessment Manual and other applicable IIA
guidance shall be used to guide the assessment and support evaluation.
LACERA invites qualified firms to respond to this RFP.
1.2. Background Information
LACERA, a $90 billion public pension fund, is a tax-qualified defined benefit public pension
fund established to administer retirement, disability, and death benefits for the employees of
the County of Los Angeles and other participating agencies pursuant to the County Employees
Retirement Law of 1937 (CERL) (California Government Code Section 31450, et seq.), the
California Public Employees' Pension Reform Act of 2013 (PEPRA) (California Government
Code Section 7522, et seq.), LACERA's Bylaws and Board Policies, and other applicable
California law. LACERA also administers the County's medical and dental retiree health
benefits program.
LACERA operates as an independent governmental entity separate and distinct from Los
Angeles County and the other participating agencies. LACERA has approximately 200,000
members, including 99,000 active members and 79,000 retired members. About 159,000 retired
members and survivors take part in the medical and dental retiree healthcare programs. In
addition to benefits administration, the fund invests in assets to support payment of the
promised pension benefits as well as additional sums to support the retiree healthcare program.
The Respondent(s) selected through this RFP process will be recommended to LACERA's
Joint Audit, Compliance, Risk, and Ethics (ACRE) Committee for approval. The ACRE
Committee is made up of seven members: three elected annually from each Board and the ex-
officio member of both Boards, the Los Angeles County Treasurer. The ACRE Committee
assists the Board of Retirement (BOR) and the Board of Investment (BOI) in fulfilling their
fiduciary oversight responsibilities. The ACRE Committee focuses on matters relating to
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finance, investments, and operations, and oversees LACERA's governance activities, including
risk management practices and related internal controls. Within each organizational area, the
ACRE Committee oversees four primary functions: policies and programs, monitoring and
enforcement, contracting and coordination, and reporting and communication.
The Internal Audit Division.
Established in 1992, LACERA's Internal Audit is comprised of eleven employees including the
Chief Audit Executive (CAE), two Principal Internal Auditors, six Senior Internal Auditors, one
Internal Auditor, and an Administrative Assistant. The mission of Internal Audit is to provide
independent, objective assurance and advisory services designed to add value and improve
the organization's operations. The CAE reports directly to LACERA's ACRE Committee for
functional purposes and administratively to LACERA's Chief Executive Officer (CEO).
2. SCOPE OF SERVICES
The External Assessor shall evaluate, at a minimum, the following elements of Internal
Audit:
CAE reporting lines, organizational independence, annual independence
confirmation, and quality assurance framework
Organization, structure, mandate, charter, authority, role, responsibilities, and
scope of the Internal Audit function
Board and senior management essential conditions, including ACRE Committee
oversight, support, approval responsibilities, and unrestricted access expectations
Risk assessment methodology and engagement planning processes
Internal audit strategy, performance objectives, performance measurement
methodology, and continuous improvement activities
Professional proficiency and development of audit staff
Financial, human, and technological resources to support audit work
Productivity, performance, and value delivery
Selected audit workpapers, reports, engagement planning documentation, risk
assessments, work programs, supervisory review evidence, and follow-up
documentation
Interviews with the ACRE Committee Chair and Committee members
Interviews with executive and senior management
Interviews with Internal Audit staff and external auditor
Review of the Internal Audit function's coordination and reliance activities with
internal and external assurance providers
KEY PROCEDURES
As part of the EQA, the External Assessor shall perform the following procedures:
Provide an independent opinion on the Internal Audit function's conformance with
the Global Internal Audit Standards
Assess the design and effectiveness of the Quality Assurance and Improvement
Program (QAIP)
Evaluate compliance with applicable laws, regulations, and governance
requirements
Assess the effectiveness of the Internal Audit function in relation to its mandate,
charter, strategy, stakeholder expectations, and organizational objectives
Identify leading practices and opportunities to enhance the Internal Audit
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function's value, impact, quality, and contribution to governance, risk
management, and control processes
Evaluate coordination with governance stakeholders, including enterprise risk
management, compliance, external auditors, and other assurance providers
Assess the methodology used to develop the audit universe, organization wide
risk assessment, and dynamic risk-based internal audit plan
Evaluate resource adequacy, including financial, human, and technological
resources, to ensure appropriate audit coverage and successful achievement of
the internal audit plan
Assess staff qualifications, professional development, competencies, use of audit
tools, and adherence to documented methodologies
Evaluate engagement-level conformance with the Standards, including
engagement communication, risk assessment, objectives and scope, evaluation
criteria, work programs, information gathering, analysis, findings,
recommendations, conclusions, documentation, and monitoring of action plans
Evaluate the application of the Global Internal Audit Standards in a public sector
environment, including governance structure, transparency requirements, public
accountability, funding considerations, and applicable legal or regulatory
requirements
Evaluate stakeholder perceptions through surveys and interviews
Identify opportunities to enhance policies, practices, and coordination with
external auditors
Refer to EXHIBIT D - STATEMENT OF WORK for further information and details.
3. MINIMUM QUALIFICATIONS
All Respondents must clearly show and document in the proposal the following
minimum qualifications:
A. The consultant/firm has provided services consistent with the services requested in
this RFP for the past 10 years.
B. The consultant or team lead assigned to this engagement has experience that is
comparable to that of the Chief Audit Executive of LACERA
C. The consultant or at least one member of the team has a Certified Internal Auditor
(CIA) Designation.
D. The consultant/team has a thorough understanding of current internal audit
practices and the International Professional Practices Framework (IPPF) and its
application, sound judgment, and good communication and analytical skills as they
relate to external audit assessments.
E. The consultant/team possess or has ready access to all the necessary technical
expertise (e.g., governance, IT, risk management, internal audit attributes,
management consulting, and internal audit management).
F. The consultant or at least one team member has knowledge of the organization's
industry, service, or internal audit.
4. INSTRUCTIONS TO RESPONDENTS
4.1. RFP Important Dates
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The following table provides a tentative schedule of important dates and deadlines for this RFP.
All dates are subject to modification by LACERA without notice.
Event Description Date (tentative)
RFP release date June 26, 2026
Intent to Respond closing date July 17, 2026
Written questions from Respondents due date July 17, 2026
LACERA's response to Respondents' questions July 22, 2026
RFP due date July 30, 2026
Selection Notification (estimate) August 7, 2026
August 19, 2026
ACRE Approval of Selected Vendor
September 1, 2026
Commencement of work
November 18,2026
Present EQA Report to ACRE
4.2. Response Requirements and Formatting
Respondents to this RFP must submit the following for delivery no later than 5:00 PM PDT on
July 30, 2026 via email to aochoa@lacera.gov.
Respondents must provide an electronic copy of the proposal in PDF or Microsoft Word format.
If Respondent requires any confidential information to be exempt from public disclosure, then
submissions should also include one unbound copy, and one electronic copy, each marked
"CONFIDENTIAL." The redacted copies should redact all material from the proposal that the
Respondent believes in good faith is exempt from disclosure under the California Public
Records Act, (California Government Code section 7920.000, et seq., the "Act"). Redactions
should appear as blacked out material. Large sections, tables, or entire blank page(s) shall
include the word "CONFIDENTIAL" or "PROPRIETARY" inserted. Each Respondent must
indicate the basis for each redaction under the Act (defined below) with a citation to the code
section and subsection relied upon. LACERA cannot guarantee that redacted information will
not be publicly available. Please see the Section 6 below "Notice to Respondents Regarding
the Public Records Act AND RALPH M. BROWN ACT" for further information. An electronic
copy of both the original and the redacted response in PDF format saved on separate electronic
files, each labeled accordingly.
All responses to this RFP should follow the outline of the RFP requirements and should fully
respond to each section as appropriate and to all requirements in Exhibit B and should contain
at a minimum:
4.2.1.1. Cover Letter. A cover letter (1 page) shall be signed by the
individual(s) who is (are) authorized to bind the Respondent contractually. The
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letter shall contain a statement to the effect that the Respondent is not currently
under investigation by any regulatory agency, state or federal, for any reason. The
letter should identify your firm's competitive advantage, the specific team that will
be working on the LACERA account, and the reasons why the firm should be
selected.
4.2.1.2. Minimum Qualifications Certification. You must certify, by
completing and signing EXHIBIT C, that your firm meets the minimum qualifications
required.
4.2.1.3. Table of Contents. The response must contain a Table of Contents
that identifies the major sub-sections of the Questionnaire.
4.2.1.4. Proposal Requirements. Provide your response to the Proposal
Requirements (EXHIBIT B). Responses shall be in the prescribed format.
4.2.1.5. Attachments. Optional material such as brochures or company
information may be included as an attachment but will not be counted as
responsive to this RFP and will not be used in scoring.
4.2.2. All proposals made in response to this RFP must remain open and in effect for a
period of not less than 180 days after the submission deadline. Responses to this RFP may be
changed or withdrawn in writing if modifications are received prior to the submission deadline.
Modification to or withdrawal of a proposal received after the submission deadline will not be
considered. Responses received after the specified deadline may be considered for evaluation
solely at the discretion of LACERA. In addition, LACERA reserves the right to request more
information or clarifications from Respondents, or to allow corrections of errors or omissions.
4.2.3. Proposals not following these instructions or not including complete information
as requested may result in a lower evaluation score or the proposal being declared non-
responsive. For each part of the response, restate the RFP item immediately above the
response. Pages in the proposal shall be numbered. When asked, please provide details, and
state all qualifications or exceptions. All information supplied should be concise and relevant to
qualifications.
4.3. Contacts with LACERA Personnel
Contacts with LACERA personnel about this RFP, and all inquiries and requests for information
shall be directed to the Point of Contact identified below:
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Alex Ochoa
Internal Auditor
LACERA
Gateway Plaza Email: aochoa@lacera.gov
300 North Lake Avenue, Suite 870 Phone: 626-603-2477
Pasadena, CA 91101-4199
4.4. Quiet Period
To ensure that prospective Respondents to this RFP have equal access to information about
the RFP and communications related to the RFP are consistent and accurate so that the
selection process is efficient and fair, a quiet period will be in effect from the date of issuance
of this RFP until the selection of one or more Respondents is completed and announced.
This RFP and other relevant information related to the RFP, including addenda, modifications,
answers to questions, and other updates, will be available to the public at lacera.gov. Each
Respondent to this RFP will be subject to the same terms and conditions and will receive the
same information.
During the quiet period, Respondents are not allowed to communicate with any LACERA staff
member or Board member regarding this RFP except through the point of contact named
herein. Respondents violating the quiet period may be disqualified at LACERA's discretion.
Respondents who have existing relationships with LACERA must limit their communications
between LACERA staff and Board members to the subject of the existing services provided by
them.
4.5. Questions relating to this RFP
All questions, inquiries, and requests for additional information concerning this RFP should be
received no later than 5:00 PM PDT, July 17, 2026, and should be emailed to
aochoa@lacera.gov. All questions received and responses thereto will be posted on LACERA's
website (www.lacera.gov) under the "Business Opportunities" section that relates to this RFP
(https://www.lacera.gov/who-we-are/business-opportunities) on or about 5:00 PM PDT, July
22, 2026.
4.6. Intent to Respond
If your firm chooses to respond to this RFP, please send the Intent to Respond, EXHIBIT A, via
email to aochoa@lacera.gov, by 5:00 p.m. PDT, July 17, 2026. Failure to send your Intent to
Respond may disqualify your firm from submitting a response to this RFP.
5. EVALUATION CRITERIA AND SELECTION PROCESS
LACERA staff will review and score all complete, responsive proposals against a set criteria.
LACERA may, at its option and in any order, shortlist top-ranked firms, conduct interviews or
request presentations, submit written follow-up questions, and check references before
recommending one or more firms to the ACRE Committee. Participation in any step does not
guarantee selection, and LACERA reserves the right to request additional information at any
time.
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LACERA imposes a Best Value Standard and will award based on best value to LACERA -
the proposal offering the optimal combination of qualifications, experience, methodology, team,
and fee, as determined by LACERA in its sole discretion - which may not be the proposal
offering the lowest fee or achieving the highest score.
6. NOTICE TO RESPONDENTS REGARDING THE PUBLIC RECORDS ACT AND THE
RALPH M. BROWN ACT
The information submitted in response to this RFP will be subject to public disclosure pursuant
to the California Public Records Act (California Government Code Section 7920.000, et. seq.,
the "Act"). The Act provides generally that all records relating to a public agency's business are
open to public inspection and copying unless specifically exempted under one of several
exemptions set forth in the Act. If a Respondent believes that any portion of its proposal is
exempt from public disclosure or discussion under the Act, the Respondent must provide a full
explanation and mark such portion "TRADE SECRETS," "CONFIDENTIAL" or
"PROPRIETARY," and make it readily separable from the balance of the response. Proposals
marked "TRADE SECRETS," "CONFIDENTIAL" or "PROPRIETARY" in their entirety will not
be honored, and LACERA will not deny public disclosure of all or any portion of proposals so
marked.
By submitting a proposal with material marked "TRADE SECRETS," "CONFIDENTIAL" or
"PROPRIETARY," a Respondent represents it has a good faith belief that the material is
exempt from disclosure under the Act; however, such designations will not necessarily be
conclusive, and a Respondent may be required to justify in writing why such material should
not be disclosed by LACERA under the Act. Fee and pricing proposals are not considered
"TRADE SECRET," "CONFIDENTIAL" or "PROPRIETARY."
If LACERA receives a request pursuant to the Act for materials that a Respondent has marked
"TRADE SECRET," "CONFIDENTIAL" or "PROPRIETARY," and if LACERA agrees that the
material requested is not subject to disclosure under the Act, LACERA will deny disclosure of
those materials. LACERA will not be held liable, however, for inadvertent disclosure of such
materials, data, and information or for disclosure of such materials if deemed appropriate in
LACERA's sole discretion. LACERA retains the right to disclose all information provided by a
Respondent and will make its own independent determinations as to what materials are subject
to production under the Act without regard to redactions or markings.
If LACERA denies public disclosure of any materials designated as "TRADE SECRETS,"
"CONFIDENTIAL" or "PROPRIETARY," the Respondent agrees to reimburse LACERA for, and
to indemnify, defend and hold harmless LACERA, its Boards, officers, fiduciaries, employees,
and agents from and against:
1. All claims, damages, losses, liabilities, suits, judgments, fines, penalties, costs, and
expenses, including without limitation attorneys' fees, expenses, and court costs of any
nature whatsoever (collectively, Claims) arising from or relating to LACERA's non-
disclosure of any such designated portions of a proposal; and
2. All Claims arising from or relating to LACERA's public disclosure of any such
designated portions of a proposal if LACERA determines disclosure is deemed required
by law, or if disclosure is ordered by a court of competent jurisdiction.
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If LACERA staff recommends any Respondent to the Boards for hiring, such recommendation,
the reasons for the recommendation, and the relevant proposal(s) will appear on a publicly
posted agenda and in supporting materials for public meetings of the Boards.
Nothing in this RFP requires LACERA to withhold any documents from production under
the Act.
7. DIVERSITY, EQUITY, AND INCLUSION
LACERA values diversity, equity, and inclusion ("DEI"), and believes that effectively accessing
and managing diverse talent leads to improved outcomes. LACERA takes a broad view of
diversity, inclusive of varied backgrounds including, but not limited to, age, experience, race,
ethnicity, sexual orientation, gender identity, disability status, national origin, and culture.
LACERA expects its business partners to respect and reflect LACERA's value of DEI.
With respect to diversity, please include in your proposal responses to the following:
Description of diversity policies, practices, and procedures maintained by the firm
regarding equal employment opportunity, including the recruitment, development,
retention, and promotion of a diverse and inclusive workforce, non-discrimination based
on gender, race, ethnicity, sexual orientation, age, disability status, veteran's status, and
other legally protected categories, and prohibition of sexual harassment in the
workplace. If the Respondent has written policies that address these matters, provide
copies along with the response to this RFP.
The oversight, monitoring, and other compliance processes for implementation and
enforcement of the firm's diversity policies, practices, and procedures, including the
name of the individual who is responsible for oversight of the firm's method to measure
the effectiveness of the policies, and conclusions as to effectiveness.
Any judicial, regulatory, or other legal findings, formal action, or claims related to equal
employment opportunity, workplace discrimination, or sexual harassment during the
past ten (10) years
8. NOTICE TO RESPONDENTS REGARDING LACERA DATA PROTECTION
LACERA, its consultants, vendors, and contractors have a duty to protect all LACERA data,
including without limitation, information related to members and beneficiaries, finances,
systems, and operations.
The finalist selected through this procurement will have access to sensitive information
protected by LACERA's internal policies, State, and Federal law. In such a case, by submitting
a proposal, Respondent agrees to subject itself to certain contractual terms designed to protect
such information, including without limitation cyber liability insurance, SOC-2 reports (or, in the
alternative, a Security Controls Assessment as per EXHIBIT E). Respondents shall inform
LACERA in their response if they have any limitations to agreeing to such terms. Respondents
that do not make reservations shall lose their right to do so at the contracting phase.
9. CONTRACT NEGOTIATIONS
Upon ACRE Committee approval, staff will enter contract negotiations with the approved
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