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HomeMy WebLinkAboutVII(F) Renewal Of Audit Agreement With Mcdirmit, Davis, Puckett And Company rtgenua '-VD-L000 "CENTER OF GOOD LIVING-PRIDE OF WEST ORANGE" _IMeAYOR•LOMMISSIONER Ocoee S.SCOTT VANDERGRIFT 0 • CITY OF O C O E E COMMISSIONERS �r 150 N.LAKESHORE DRIVE DANNY HOWELL OCOEE,FLORIDA 34761-2258 RUSTY OHNSTT JOHNSON ON v RUSTY n `°yj, ,�? (407)656-2322 NANCY J.PARKER 4":4 OF G00�`> CITY MANAGER ELLIS SHAPIRO Memorandum To The Honorable Mayor and City Commissioners From : Wanda B. Horton,Finance Director Date : August 29,2000 Re Contract for Auditing Services The City advertised for requests for proposals for auditing services in 1997. Proposals were received from five firms and based upon the unanimous recommendation of a selection review committee, the City awarded a contract for auditing services to McDirmit, Davis, Puckett and Company for a three year period. The three year period has culminated. Staff wishes to extend the relationship with the firm. The firm has worked well with the staff and financial investment team. Governmental Auditing Standards Board Pronouncement 34 (GASB 34) will change the method of financial reporting for municipalities. This is a major undertaking for city, county and state governments. Staff has been working with our auditors on this project and have made some strides in implementing some of the required changes to the financial reporting. The attached contract is for a three year period. The base audit fee is less than the current contract amount by $4,500 for the first year. This contract has been reviewed by the city attorneys. Action Requested Staff requests that the attached contract with McDirmit, Davis, Puckett, and Company to provide auditing services be approved and the Mayor and City Clerk be authorized to execute all necessary documents. it- POW!" Protect acttun's Viztei Ilesi rcOs CONTRACT TO AUDIT FINANCIAL STATEMENTS AND RECORDS Of the City of Ocoee, Florida, by this agreement entered into this _th day of , 2000, between McDirmit, Davis, Puckett & Company, P.A., hereinafter referred to as the Auditor, and the City of Ocoee, Florida, hereinafter referred to as the Government Unit, as follows: SECTION A— SCOPE OF SERVICES (1) In accordance with the provisions of Florida Statutes or Laws of Florida, the Auditor shall examine the financial statements of the Governmental Unit for the following periods: (a) Period beginning October 1, 1999 and ending September 30, 2000. (b) Period beginning October 1, 2000 and ending September 30, 2001. (c) Period beginning October 1, 2001 and ending September 30, 2002. (2) The Auditor will issue an audit opinion on the combined Government Unit. (3) Audits of independent special districts, as that term is defined in Florida Statutes 218.31(7) and other entities not in operation or existence on September 30, 1987, and separate audits required by State or Federal authorities (e.g., Federal Grant Audits) are excluded from this agreement. Such excluded audits, however, if and when required by State Law or requested by the Government Unit may be added to this agreement through negotiation between the parties. (4) It is agreed that the engagement shall include a review of the system of internal control and of compliance with budgetary and legal requirements by the Government Unit. A summary or list of known compliance requirements shall be supplied to the Auditor by the Government Unit at the commencement of the engagement. SECTION B —TERM OF THE AGREEMENT/PROVISION FOR CANCELLATION (1) The term of the agreement is as specified in Section A (1) preceding. (2) Either party may cancel this agreement for the next fiscal year by written notice to the other party no later than September 30 of the current fiscal year, such cancellation shall take place upon the completion of the current year audit. (3) This agreement may be extended on a year-to-year basis beyond the initial term by mutual agreement of both parties. SECTION C —AUDIT STANDARDS (1) The Auditor shall conduct the examination in accordance with generally accepted auditing standards applicable to governmental units, as prescribed in the following documents: (a) Statements of Auditing Standards and Audits of State and Local Governmental Units —AICPA. (b) Standards of Audit of Governmental Organization, Programs, Activities and Functions — General Accounting Office. SECTION D — REPORTS AND OTHER COMMUNICATION (1) The Auditor shall submit to the City Commission a written report of the audit. This report shall contain an expression of opinion that the financial statements are fairly stated, or if a qualified, adverse or disclaimer of opinion is necessary, the reasons therefore. (2) If weaknesses are noted in internal accounting control, other observed management weaknesses or variance from compliance requirements as specified in Section A (4), a written report (management letter) will be issued identifying such weaknesses or non-compliance. This letter shall include written responses by Government officials to the Auditor's observations. (3) The Auditor shall furnish 50 copies of the Auditor's report suitable for binding in the financial statements. (4) The audit shall begin no later than November 15th of each year and shall be completed no later than January 31st of each year. SECTION E —ASSISTANCE TO BE PROVIDED BY THE GOVERNMENTAL UNIT (1) The Government Unit shall have adjusted or closed all accounts and have prepared financial statements for all funds and shall have them available for examination by no later than November 15th of each year. (2) The Government Unit shall provide space deemed adequate by the Auditor to efficiently conduct the examination. (3) The Government Unit staff shall render all feasible assistance, including preparation of schedules required by the Auditor, shall respond promptly to requests for information and provide all necessary books and records for the Auditor to expeditiously conduct the engagement. SECTION F— COMPENSATION AND TERMS OF PAYMENT (1) In consideration of the satisfactory performance of the provisions of this agreement, the Government Unit shall pay to the Auditors according to the following fee schedules: OPTIONAL CAFR FISCAL YEAR BASE AUDIT FEE PREPARATION 1999-2000 $25,000 $4,500 2000-2001 26,000 4,600 2001-2002 27,000 4,700 (a) The city may exercise an option to prepare its own financial statements (CAFR) in any year and eliminate the CAFR preparation fee. (b) If in any year, the Government Unit receives Federal grant funds and is required to issue a single audit, an additional fee of$3,500 will be paid to the Auditor. (c) Due to the major impact that GASB Statement No. 34 will have on municipal financial statements, it is understood that all services rendered by the Auditors to plan and implement this pronouncement will be additional fees. (2) Stated fees are for the audit and will include a review of the completed annual report to the Comptroller. Inquiries of general accounting nature that do not require significant research time will be responded to without charge. Services outside the scope of the audit and inquiries that require significant research time will be charged on a per diem basis with the following hourly rates: AUDIT STOCKHOLDER $ 130.00 PER HOUR AUDIT MANAGER $ 95.00 PER HOUR AUDIT SENIOR $ 70.00 PER HOUR AUDIT STAFF $ 55.00 PER HOUR (3) Interim progress billings may be submitted for services rendered to date, but not more often than monthly. (4) Should irregularities, the absence of reasonable cooperation of the Government Unit staff, or other unforeseen conditions be encountered which might necessitate the extension of the auditing work beyond the scope of normal auditing procedures, the Auditor agrees to advise the Government Unit in writing of the circumstances and to request an increase in the maximum fee before significant additional time is incurred. 9-30-2000 11 :47AM FROM MCD I RM I TDAV I SPUCKETT 4076499339 P. 2 • SECTION G — ILLEGAL ACTS • (1) The audits described herein include procedures designed to detect errors and irregularities that would have a material effect of• the financial statements. However, there are inherent limitations in the auditing process. For example, audit examinations are based on the concept of selective testing of the data being examined and are, therefore, subject to the inherent limitations that errors and irregularities, if they exist, may not be detected. Also, even though in making its examination, including compliance portions of the audit test, the Auditor will be aware of the possibility that illegal acts may have occurred, such an audit examination cannot be expected to provide assurance that illegal acts will be detected. • • SECTION H — CHANGES IN THE LAW • • (1) In the event that the laws requiring this audit to be performed are amended or repealed, this agreement may be amended to the extent required by such change in law and in the event of repeal, the agreement may be canceled at the direction of the Government Unit. SECTION I — INDEMNIFICATION OF CITY (1) The Auditor shall indemnify and save harmless and defend the City, its • Commissioners, officers, agents and employees from and against any claim, demand or cause of action of whatsoever kind or nature arising out of error, omission or negligent act of the Auditor, its agents or employees in the performance of services under this Agreement. The City agrees to provide the Auditor with prompt notice of any claim, demand or cause of action. The Auditor shall not be required to indemnify or save harmless or defend the City, its Commissioners, officers, agents or employees from and against any claim, demand or cause of action caused by the negligent acts or negligent omissions, or willful misconduct, of the City, its Commissioners, officers, agents and employees. SECTION J — NOTICES (1) Notices to the Auditor shall be sent to: McDirmit, Davis, Puckett & Company, P.A. Certified Public Accountants 605 E. Robinson Street, Suite 635 Orlando, Florida 32801 (2) Notices to the Government Unit shall be sent to: • City of Ocoee, Florida 150 Lakeshore Drive • Ocoee, Florida 34761