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HomeMy WebLinkAboutR-1998-130 RESOLUTION NO. 130-98 A RESOLUTION OF THE CITY OF DANIA, FLORIDA, ACCEPTING AN ENGAGEMENT LETTER SUBMITTED BY S. DAVIS & ASSOCIATES, P.A. TO PROVIDE AUDITING SERVICES FOR THE CITY OF DANIA FOR THE YEARS ENDING SEPTEMBER 30, 1998, 1999 AND 2000; PROVIDING FOR AN ANNUAL FEE NOT TO EXCEED $36,775.00; FURTHER, PROVIDING FOR AN EFFECTIVE DATE. BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF DANIA, FLORIDA; Section 1. That the certain engagement letter dated August 26, 1998, submitted by S. Davis & Associates, P.A., providing auditing services for the City of Dania for the years ending September 30, 1998, 1999 and 2000, a copy of which is attached hereto as Exhibit "A", is approved and the appropriate city officials are authorized to execute same. Section 2. That the city Manager is authorized to pay from the General Fund an amount not to exceed $36,775.00 on an annual basis for the years ending September 30, 1998, 1999, and 2000. Section 3 That this resolution shall be in force and take effect immediately upon its passage and adoption. PASSED AND ADOPTED THIS 8th day of September 1998. ` _Al MAYOR-COMMISSIONER TT C CLERK- UDITO APPROV D P AS T FO M AND CORRECTNESS: ,-, . �? CITY—fAl O"EY RESOLUTION N0. 130-98 I 1 `® S. DAVIS & ASSOCIATES, P.A. Certified Public Accountants s' Suite IIOY 2521 Hollywood Boulevard 1515 N.W. 167 Street Hollywood,Florida 33020 Miami,Florida 33169 (954)927-5900 (305)628-1510 (954)927-5927 Fax (305)628-1595 Fax August 26, 1998 City of Dania Honorable Mayor, Members of the City Commission and City Manager City of Dania P.O. Box 1708 Dania, Florida 33004 We are pleased to confirm our understanding of the services we are to provide the City of Dania for the year ended September 30, 1998. We will audit the general purpose financial statements of the City of Dania as of and for the year ended September 30, 1998. Also, the document we submit to you will include the following additional information that will be subjected to the auditing procedures applied in our audit of the general purpose financial statements: i 1. GASB required supplementary pension information 2. Information for the Comprehensive Annual Financial Report (CAFR) The objective of our audit is the expression of an opinion as to whether the general purpose financial statements are fairly presented, in all material respects, in conformity with generally accepted accounting principles and to report on the fairness of the additional information referred to in the first paragraph when considered in relation to the general purpose financial statements taken as a whole. Our audit will be conducted in accordance with generally accepted auditing standards and the standards for financial audits contained in Government Auditing Strnrdards, issued by the Comptroller General of the United States, Office of Management and Budget("OMB")Circular A-133, Audits of Institutions of Higher Education and other Nonprofit Institutions, and will include tests of the accounting records of the City of Dania and other procedures we consider necessary to enable us to express such an opinion. If our opinion on the general purpose financial statements is other than unqualified,we will fully discuss the reasons with you in advance. If, for any reason, Ave are unable to complete the audit or are unable to express an opinion, we may decline to express an opinion or may not issue a report as a result of this engagement. Member Florida Institute of Certified Public Accountants New York State Society of Certified Public Accountants American Institute of Certified Public Accountants City of Dania Engagement Letter Page 2 The management of the City of Dania is responsible for establishing and maintaining internal control. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of the controls. The objectives of internal control are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition,that transactions are executed in accordance with management's authorizations and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles. In planning and performing our audit, we will consider the internal control sufficient to plan the audit in order to determine the nature, timing, and extent of our auditing procedures for the purpose of expressing our opinion on the City of Dania's general purpose financial statements. We will obtain an understanding of the design of the relevant controls and whether they have been placed in operation, and we will assess control risk. Tests of controls may be performed to test the effectiveness of certain controls that we consider relevant to preventing and detecting errors and fraud that are material to the general purpose financial statements and to preventing and detecting misstatements resulting from illegal acts and other noncompliance matters that have a direct and material effect on the general purpose financial statements. (Tests of controls are required only if control risk is assessed below the maximum level.) Our tests, if performed, will be less in scope than would be necessary to render an opinion on internal control and, accordingly, no opinion will be expressed. An audit is not designed to provide assurance on internal control or to identify reportable conditions. However, we will inform the governing body or audit committee of any matters involving internal control and its operation that we consider to be reportable conditions under standards established by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control that, in our judgment,could adversely affect the entity's ability to record, process, summarize, and report financial data consistent with the assertions of management in the general purpose financial statements. Identifying and ensuring that the City of Dania complies with laws, regulations, contracts, and agreements is the responsibility of management. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement, we will perform tests of the City of Dania's compliance with applicable laws and regulations and the provisions of contracts and agreements. However, the objective of our audit will not be to provide an opinion on overall compliance and we will not express such an opinion. I City of Dania Engagement Letter Page 3 Our procedures will include tests of documentary evidence supporting the transactions recorded in the accounts,and may include tests of the physical existence of inventories, and direct confirmation of receivables and certain other assets and liabilities by correspondence with selected individuals, creditors, and financial institutions. We will request written representations from your attorneys as part of the engagement, and they may bill you for responding to this inquiry. At the conclusion of our audit,we will also require certain written representations from you about the financial statements and related matters. I An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; therefore, our audit will involve judgment about the number of transactions to be examined and the areas to be tested. We will plan and perform the audit to obtain reasonable I rather than absolute assurance about whether the financial statements are free of material misstatement,whether caused by error or fraud. Because of the concept of reasonable assurance and because we will not perform a detailed examination of all transactions, there is a risk that a material misstatement may exist and not be detected by us. In addition, an audit is not designed to detect errors, fraud, or other illegal acts that are immaterial to the general purpose financial statements. However,we will inform you of any material errors and any fraud that comes to our attention. We will also inform you of any other illegal acts that come to our attention, unless clearly inconsequential. Our responsibility as auditors is limited to the period covered by our audit and does not extend to matters that might arise during any later periods for which we are not engaged as auditors. An audit of the general purpose financial statements performed in accordance with generally accepted auditing standards is not designed to determine whether the computer systems of the City of Dania are year 2000 compliant, or to provide any assurance on whether the City of Dania, has addressed all of the affected systems on a timely basis. Further, we have no responsibility with regard to the systems of vendors,service providers, or any other third parties. These are responsibilities of the City of Dania's management. However, we may choose to communicate matters that come to our attention relating to the Year 2000 Issue. Management is responsible for making all financial records and related information available to us. We understand that you will provide us with such information required for our audit and that you are responsible for the accuracy and completeness of that information. We will advise you about appropriate accounting principles and their application and will assist in the preparation of your financial statements, but the responsibility for the financial statements remains with you. That responsibility includes the establishment and maintenance of adequate records and effective internal control over financial reporting, the selection and application of accounting principles, and the safeguarding of assets. tow i City of Dania Engagement Letter Page 4 We understand that your employees will prepare all cash or other confirmations we request and will locate any invoices selected by us for testing. The work papers for this engagement are the property of S. Davis& Associates, P.A. and constitute confidential information. However, we may be requested to make certain work papers available pursuant to authority given to it by law or regulation. If requested, access to such work papers will be provided under the supervision of S. Davis & Associates, P.A. personnel. Furthermore, upon request,we may provide photocopies of selected work papers. Third parties may intend, or decide, to distribute the photocopies or information contained therein to others, including other governmental agencies. Our fee for these services will be at our standard hourly rates plus out-of-pocket costs (such as postage, travel, copies, telephone, etc.)except that we agree that our gross fee, including expenses and the Comprehensive Annual Financial Report, will not exceed$36,775 for the audit for September 30, 1998, 1999 and 2000, assuming no substantial changes by the City. Our standard hourly rates vary according to the degree of responsibility involved and the experience level of the personnel assigned to your audit. Our invoices for these fees will be rendered each month as work progresses and are payable on presentation. In accordance with our firm policies, work may be suspended if your account becomes 30 days or more overdue and may not be resumed until your account is paid in full. ifwe elect to terminate our services for nonpayment, you will be obligated to compensate us for all time expended and to reimburse us for all out-of-pocket costs through the date of termination. The above fee is based on anticipated cooperation from your personnel and the assumption that unexpected circumstances will not be encountered during the audit. If significant additional time is necessary,we will discuss it with you and arrive at a new fee estimate before we incur the additional costs. Any controversy or claim arising out of or relating to the services covered by this letter or hereafter provided by us to the City of Dania(including any such matter involving any subsidiary, affiliate or agent of the City of Dania or of S. Davis & Associates, P.A.) shall be submitted first to voluntary mediation, and if mediation, is not successful then to binding arbitration in accordance with the dispute resolution procedures set forth in the attachment to this letter. Judgement on any arbitration award may be entered in any court having proper jurisdiction. Government Auditing Standards require that we provide you with a copy of our most recent quality control review report. Our 1996 peer review report accompanies this letter. City of Dania Engagement Letter Page 5 We appreciate the opportunity to be of service to the City of Dania and believe this letter accurately summarizes the significant terms of our engagement. If you have any questions, please let us know. If you agree with the terms of our engagement as described in this letter, please sign the enclosed copy and return it to us. Very truly yours, S. Davis& Associates, P.A. RESPONSE: This letter correctly sets forth the understanding of the City of Dania. By: Title: Date: I M� DISPUTE RESOLUTION PROCEDURES The following procedures shall be used to resolve any controversy or claim ("dispute") as provided in our engagement letter of August 26, 1998. If any of these provisions are determined to be invalid or unenforceable, the remaining provisions shall remain in effect and binding on the parties to the I fullest extent permitted by law. Mediation A dispute shall be submitted to mediation by written notice to the other party or parties. In the ` mediation process, the parties will try to resolve their differences voluntarily with the aid of an impartial mediator, who will attempt to facilitate negotiations. The mediator will be selected by agreement of the parties. If the parties cannot agree on a mediator, a mediator shall be designated by the American Arbitration Association("AAA")or such other neutral facilitator acceptable to both parties. The mediation will be conducted as specified by the mediator and agreed upon by the parties. The parties agree to discuss their differences in good faith and to attempt, with the assistance of the mediator, to reach an amicable resolution of the dispute. The mediation will be treated as a settlement discussion and therefore will be confidential. The mediator may not testify for either party in any later proceeding relating to the dispute. No recording or transcript shall be made of the mediation proceedings. Each party will bear its own costs in the mediation. The fees and expenses of the mediator will be shared equally by the parties. Arbitration If a dispute has not been resolved within 90 days after the written notice beginning the mediation process(or a longer period, if the parties agree to extend the mediation), the mediation shall terminate and the dispute will be settled by arbitration. The arbitration will be conducted in accordance with the procedures in this document and the Arbitration Rules for Professional Accounting and Related Services Disputes of the AAA as in effect on the date of the engagement letter("AAA Rules"). In the event of a conflict, the provisions of this document will control. The arbitration will be conducted before a panel of three arbitrators, regardless of the size of the dispute,to be selected as provided in the AAA Rules. Any issue concerning the extent to which any dispute is subject to arbitration, or concerning the applicability, interpretation, or enforce ability of these procedures, including any contention that all or part of these procedures are invalid unenforceable, shall be governed by the Federal Arbitration Act and resolved by the arbitrators. No potential arbitrator may serve on the panel unless he or she has agreed in writing to abide and be l bound by these procedures. I DISPUTE RESOLUTION PROCEDURES- Continued The arbitrators may not award non-monetary or equitable relief of any sort. They shall have no power to award punitive damages or any other damages not measured by the prevailing party's actual damages, and the parties expressly waive their right to obtain such damages in arbitration or in any other forum. In no event, even if any other portion of these provisions is held to be invalid or unenforceable, shall the arbitrators have power to make an award or impose a remedy that could not be made or imposed by a court deciding the matter in the same jurisdiction. No discovery will be permitted in connection with the arbitration unless it is expressly authorized by the arbitration panel upon a showing of substantial need by the party seeking discovery. All aspects of the arbitration shall be treated as confidential. Neither the parties nor the arbitrators may disclose the existence, content or results of the arbitration, except as necessary to comply with legal or regulatory requirements. Before making any such disclosure, a party shall give written notice to all other parties and shall afford such parties a reasonable opportunity to protect their interests. The result of the arbitration will be binding on the parties, and judgment on the arbitrators' award maybe entered in any court having jurisdiction. i r f , k ' i i I ' I : 1 tl` I 11 Y 1 11 1