Loading...
HomeMy WebLinkAboutCDC/1999-23 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1 2 3 4 5 6 RESOLUTION BO. CDC 1999-23 RESOLUTION OF TIlE COII_B.lTY DEVELOl'IIBI!Ir COIKrSSION OF TIlE CITY OF SAB BBRJIWlDIBO. CALIFODU. APPROVIIIG AB AG.k.uPIur WIm ROGERS. AImERSON, MALODY & SCOTT. LLP. FOR FIIUlICIAL AUDIT SERVICES FOR TIIB FISCAL YEAR DDED J1JlIIE 30. 1999. AIm AImIORIZIIIG EXEC07ION TllBREOF. WHEREAS. on April 5, 1993, the Community Development Commission ("Commission") approved an agreement with Rogers, 7 Anderson, Ma10dy & Scott, LLP, for financial audit services for the City of San Bernardino Economic Development Agency ("Agency") for the fiscal years 1992-93, 1993-94 and 1994-95; and WHEREAS, on April 15, 1996, the Commission approved an agreement with Rogers, Anderson, Ma10dy & Scott, LLP, for Agency financial audit services for the fiscal years 1995-96, 1996-97 and 1997-98; and WBEiEAS. the Commission now deems it desirable to approve and Agreement with Rogers, Anderson, Ma10dy & Scott, LLP, for Agency financial audit services for the fiscal year ended June 30, 1999. BOW. mEREFORE. BE IT RESOLVED BY THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAB BERNARDINO, AS FOLLOWS: SEC7rOB 1. The Commission hereby approves an agreement with Rogers, Anderson, Ma10dy & Scott, LLP, for Agency financial audit services for the fiscal year ended June 30, 1999, as attached hereto. SECTION 2. The Commission hereby authorizes the Executive Director to execute said agreement with Rogers, Anderson, Malody & Scott. SECTION 3. This Resolution shall take effect upon the date of its adoption. III b1:2554 10 ESTRADA 11 LIEN 12 MCGINNIS 13 SCHNETZ 14 DEVLIN 15 ANDERSON 16 17 18 19 20 21 22 23 24 25 26 27 CDe .l999-23 1 2 3 4 5 6 RESOLUTION OF THE COIRJlIITY DEVELOPIIEI'r COIMISSION OF THE CITY OF SAB R'RVWAVDlRO. CALlFOR1U.A. APPROVIlIG AB A~ VI'l'H ROGERS, AImERSOB, MALODY & scorr. LLP. FOR FIlIAICIAL AUDIT SERVICES FOR THE FISCAL YEAR ENDED .JUlIE 30. 1999. AIm AU'I'BORIZllfG EXECUTION THEREOF. I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Community Development Commission of the City of San Bernardino at a ioint regular meeting thereof, held on the 6th July day of , 1999, by the following 7 vote, to wit: 8 9 COIMISSION IlEtlBERS: ADS BYS ABSTAIN ABSDT MILLER z:~ ~~~ ~~/, // / / / ,. /' / /7// The foregoing of j},<:}_, 1999. FI resolution is hereby approved this"i~"'day Approved as to form and legal content: By: 28 bl:2554A eDe 1999-23 DONALD L. ROGERS, C_P,A DENNIS H. MALODY II, C.P,A JAY H. ZERCHER, C.P,A ROBERT B. MEMORY, C_P,A PHilLIP H. WALLER. CPA BRENDA L. DOLE, C,P_A TERRY P SHEA, C,PA IiIDIT ROGERS, ANDERSON, MALODY & SCOTT, LLP CERTIFIED PUBLIC ACCOUNTANTS NANCY Q'RAFFERTY, C,P.A CYNTHIA L. SAKS, C,P_A BRIAN W. TOMPKINS. CPA LEENA SHANBHAG. C_P_A KATHLEEN L. DEVALK, C.P,A LAURIE K. MARSCHER, C,P,A KIRK A. FRANKS, C.P.A THOMAS T PRILl. C.P.A MARK E, CARR, C.P,A June 3, 1999 The Members of the Community Development Commission City of San Bernardino Economic Development Agency 201 North E Street, Third Floor San Bernardino, California 92401-1507 We are pleased to confirm our understanding of the services we are to provide the City of San Bernardino Economic Development Agency (EDA) for the year ended June 30, 1999. We will audit the component unit financial statements of the EDA as of and for the year ended June 30, 1999. 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 component unit financial statements: 1. Combining financial statements by fund. 2. Schedule of expenditures of federal awards. Audit Objectives The objective of our audit is the expression of an opinion as to whether your component unit 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 component unit financial statements taken as a whole. The objective also includes reporting on - . Internal control related to the financial statements and compliance with laws, regulations, and the provisions of contracts or grant agreements, noncompliance with which could have a material effect on the financial statements in accordance with Government Auditing Standards. . Internal control related to major programs and an opinion (or disclaimer of opinion) on compliance with laws, regulations and the provisions or grant agreements that could have a direct and material effect on each major program in accordance with the Single Audit . Act Amendments of 1996 and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. MEMBERS AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS PRIVATE COMPANIES PRACTICE SECTION OF THE DIVISION FOR CPA FIRMS CALIFORNIA SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS VANIA TOWEA . 290 NORTH "0" STREET. SUITE 300 SAN BERNARDINO, CA 92401 (909) 889.0871 . (909) 824.6736 . FAX (909) 889.5361 , eDe 1999-23 Members of the Community Development Commission City of San Bernardino Economic Development Agency June 3, 1999 Page 2 The reports on internal control and compliance will each include a statement that the report is intended for the information and use of the audit committee, management, specific legislative or regulatory bodies, federal awarding agencies, and if applicable, pass-through entities. Our audit will be conducted in accordance with generally accepted auditing standards; the standards for financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; the Single Audit Act Amendments of 1996; and the provisions of OMB Circular A-133, and will include tests of accounting records, a determination of major program(s) in accordance with Circular A-133, and other procedures we consider necessary to enable us to express such an opinion and to render the required reports. If our opinion on the component unit financial statements or the Single Audit compliance opinion is other than unqualified, we will fully discuss the reasons with you in advance. If, for any reason, we are unable to complete the audit or are unable to form or have not formed an opinion, we may decline to express an opinion or to issue a report as a result of this engagement. Management Responsibilities Management is responsible for establishing and maintaining internal control and for compliance with the provisions of contracts, agreements, and grants. 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 component unit financial statements in accordance with generally accepted accounting principles, and that federal award programs are managed in compliance with applicable laws and regulations and the provisions of contracts and grant agreements. 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, including the schedule of expenditures of federal awards, 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 and compliance, the selection and application of accounting principles, and the safeguarding of assets. Additionally, as required by OMB Circular A-133, it is management's responsibility to follow up and take corrective action on reported audit findings and to prepare a summary schedule of prior audit findings and a corrective action plan. , eDe 1999-23 Members of the Community Development Commission City of San Bernardino Economic Development Agency June 3, 1999 Page 3 Audit Procedures - General 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 rather than absolute assurance about whether the financial statements are free of material misstatement, whether caused by error or fraud. As required by the Single Audit Act Amendments of 1996 and OMB Circular A-133, our audit will include test of transactions related to major federal award programs for compliance with applicable laws and regulations and the provisions of contracts and grant agreements. Because of the concept of reasonable assurance and because we will not perform a detailed examination of all transactions, there is a risk that material errors, fraud, other illegal acts, or noncompliance 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 component unit financial statements or to major programs. 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. We will include such matters in the reports required for a Single Audit. 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. 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. An audit of the general purpose financial statements performed in accordance with generally accepted auditing standards is not designed to determine whether the computer system of the Economic Development Agency are year 2000 compliant, or to provide any assurance on whether the Economic Development Agency 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 Economic Development Agency's management. However, we may choose to communicate matters that come to our attention relating to the Year 2000 issue. . CDC 1999-23 Members of the Community Development Commission City of San Bernardino Economic Development Agency June 3, 1999 Page 4 Additionally, sufficient audit evidence may not exist to support the government's financial statement disclosures with respect to the Year 2000 issue in accordance with GASB Technical Bulletin 98-1, Disclosures about Year 2000 Issues (TB 98-1). If we determine that there is not sufficient audit evidence to support the required disclosures, we will consider issuing a qualified opinion (scope limitation) on the Economic Development Agency's component unit financial statements. If the Economic Development Agency does not include the disclosures required by TB 98-1 and we determine that the financial statements are affected by the omission, we will issue a qualified or adverse opinion on the component unit financial statements for that departure from generally accepted accounting principles. Audit Procedures- Internal Controls 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 opinions on the Economic Development Agency's component unit financial statements and on its compliance with requirements applicable to major programs. 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 component unit financial statements. Tests of controls relative to the component unit financial statements 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 in our report on internal control issued pursuant to Government Auditing Standards. As required by OMB Circular A-133, we will perform tests of controls to evaluate the effectiveness of the design and operation of controls that we consider relevant to preventing or detecting material noncompliance with compliance requirements, applicable to each major federal award program. However, our tests will be less in scope than would be necessary to render an opinion on those controls and, accordingly, no opinion will be expressed in our report on internal control issued pursuant to OMB Circular A-133. 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 component unit financial statements. We will also inform you of any non reportable conditions or other matters involving internal control, jf any, as required by OMB Circular A-133. CDC 1999-23 Members of the Community Development Commission City of San Bernardino Economic Development Agency June 3, 1999 Page 5 Audit Procedures - Compliance Our audit will be conducted in accordance with the standards referred to in the section titled Audit Objectives. As part of obtaining reasonable assurance about whether the component unit financial statements are free of material misstatement, we will perform tests of the Economic Development Agency's compliance with applicable laws and regulations and the provisions of contracts and agreements, including grant agreements. However, the objective of those procedures will not be to provide an opinion on overall compliance and we will not express such an opinion in our report on compliance issued pursuant to Government Auditing Standards. OMB Circular A-133 requires that we also plan and perform the audit to obtain reasonable assurance about whether the auditee has complied with applicable laws and regulations and the provisions of contracts and grant agreements applicable to major programs. Our procedures will consist of the applicable procedures described in the OMB Circular A-133, Compliance Supplement. The purpose of those procedures will be to express an ,opinion on the Economic Development Agency's compliance with requirements applicable to major programs in our report on compliance issued pursuant to OMB Circular A-133. Audit Administration, Fees, and Other We understand that your employees will prepare all cash, accounts receivable, or other confirmations we request and will locate any invoices selected by us for testing. At the conclusion of the engagement, it is management's responsibility to submit the reporting package (including financial statements, schedule of expenditures of federal awards, summary schedule of prior audit findings, auditors' reports and a corrective action plan) along with the Data Collection Form to the designated federal clearinghouse and, if appropriate, to pass- through entities. The Data Collection Form and the reporting package must be submitted within the earlier of 30 days after receipt of the auditors' reports or nine months after the end of the audit period, unless a longer period is agreed to in advance by the cognizant or oversight agency for audits. At the conclusion of the engagement, we will provide information to management as to where the reporting packages should be submitted and the number to submit. The workpapers for this engagement are the property of Rogers, Anderson, Malody and Scott and constitute confidential information. However, we may be requested to make certain workpapers available to the Department of Housing and Urban Development (HUD) pursuant to authority given to it by law or regulation. If requested, access to such workpapers will be provided under the supervision of Rogers, Anderson, Malody and Scott personnel. Furthermore, upon request, we may provide photocopies of selected workpapers to HUD. HUD may intend, or decide, to distribute the photocopies or information contained therein to others, including other governmental agencies. . eDC 1999-23 Members of the Community Development Commission City of San Bernardino Economic Development Agency June 3, 1999 Page 6 Our fees are based on the time required by the individuals assigned to the engagement, plus direct expenses. Individual hourly rates vary according to the degree of responsibility involved and skill required. Interim billings will be submitted as work progresses and as expenses are incurred. Our estimated fee for the services described in this letter will be $34,000. The components of our fee for the year ended June 30, 1999 are as follows: San Bernardino Economic Development Agency Component Unit Financial Report $ 29,000 Compliance Audit Report of California Redevelopment Agencies 1,400 Compliance with the requirements of the Single Audit Act Amendments of 1996 and OMB Circular A-133 3,600 $ 34,000 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. Government Auditing Standards-1994 Revision requires that we provide you with a copy of our most recent quality control review report. Our November 30, 1996 peer review report accompanies this letter. We appreciate the opportunity to be of service to the City of San Bernardino Economic Development Agency and believe this letter accurately summarizes the significant terms of our engagement. If you have any questions, please let us know. If Y!lU agree with the terms of our engagement as described in this letter, please sign the enclosed copy and return it to us. ROGERS, ANDERSON, MALODY AND SCOTT, LLP J: p~ Terry~~a, Partner RESPONSE: This letter correctly sets forth the understanding of the City of Sa!) Bernardino Economic Development Agency. By: Title: Date: eDe 1999-23 FOUNDERS Lawrence S. Timpson, CPA (1891 - 1974) LeVerne W Garcia, CPA (1904 - 1983) TIMPSON GARCIA CERTIFIED PUBLIC ACCOUNTANTS April 24, 1997 PARTNERS Kevin Boyle, CPA Reed Cowan, CPA Dennis S, Kaneshiro, CPA Elaine Lee Kawasaki, CPA William E May, CPA James G, Nishi. CPA To the Owners Rogers, Anderson, Malody & Scott CONSULTANT William J, Boyle, CPA We have reviewed the system of quality control for the accounting and auditing practice of Rogers, Anderson, Malody & Scott (the firm) in effect for the year ended November 30, 1996. Our review was conducted in conformity with standards established by the Peer Review Board of the American Institute of Certified Public Accountants (AICPA). We tested compliance with the firm's quality control policies and procedures to the extent we considered appropriate. These tests included a review of selected accounting and auditing engagements. In performing our review, we have given consideration to the quality control standards issued by the AICPA. Those standards indicate that a firm's system of quality control should be appropriately comprehensive and suitably designed in relation to the firm's size, organizational structure, operating policies, and the nature of its practice. They state that variance in individual performance can affect the degree of compliance with a firm's quality control system and, therefore, recognize that there may not be adherence to all policies and procedures in every case. In our opinion, the system of quality control for the accounting and auditing practice of Rogers, Anderson, Malody & Scott in effect for the year ended November 30, 1996, met the objectives of quality control standards established by the AICPA and was being complied with during the year then ended to provide the firm with reasonable assurance of conforming with professional standards in the conduct of that practice. Rogers, Anderson, Malody & Scott is a member of the private companies practice section of the AICPA division for CPA firms (the section) and has agreed to comply with the membership requirements of the section. In connection with our review, we tested the firm's compliance with those requirements to the extent we considered appropriate. In our opinion the firm was in conformity with the membership requirements of the section during the year ended November 30, 1996 in all material respects. v~~jJ~ t! Member - Division for CPA Firms - American Institute of Certified Public Accountants 1610 Harrison Street, Oakland, California 94612-3379 (510) 832-2325 (510) 836-4217 Fax (510) 465-2979 (800) 941-2727