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HomeMy WebLinkAbout15- Finance a CITY OF SAN BERNARDINO — REQUEST FOR COUNGRI" From: Barbara Pachon Subject: Resolution authorizing Director of Finance execution of Amendment No. 1 to the Agreement for financial audit Dept: Finance services between the City of San Bernardino and Rogers, Anderson, Date: July 24, 2009 Malody & Scott, LLP. Council Date: 8/17/09 Synopsis of Previous Council Action: On July 10, 2006 Resolution 2006-240 was approved awarding a three year agreement to Rogers, Anderson, Malody & Scott, LLP for financial audit service. Recommended motions: Adopt Resolution Signature Contact person: Barbara Pachon, Director of Finance Phone: 5242 Supporting data attached: Staff Report, Attachment Ward: All FUNDING REQUIREMENTS: Amount: $54,300 Source: 001-092-5502 Finance: Council Notes: .�so moo q-07 9� Agenda Item No. '� CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION STAFF REPORT SUBJECT Resolution of the Mayor and Common Council authorizing Amendment 1 to the agreement between the City of San Bernardino and Rogers, Anderson,Malody&Scott (RAMS)to extend the contract period for financial audit services by two years. BACKGROUND On April 13, 2006, the City of San Bernardino, the Economic Development Agency and the Municipal Water Department issued a joint Request for proposals (RFP) F-06-21 for financial audit services beginning with the fiscal year ending June 30, 2006. The RFP required separate audits and subsequent separate financial reports for each entity plus a Comprehensive Annual Financial Report(CAFR) encompassing all three entities. The RFP was sent to thirteen (13) qualified Certified Public Accounting Firms, as well as being posted on the City's web site and provided to the Chamber of Commerce. Staff met and evaluated proposals received and recommended that the Mayor and Council award a three-year contract for financial audit services to RAMS. The three-year agreement with RAMS ended on June 30, 2009 (for the financial audit period of FY 07-08) During FY 2008-2009 the City Manager requested Departments to contact the various vendors and consultants they do business with and request them to reduce their costs to the City by 5% as a way to help the City of San Bernardino reduce their expenditures to balance the budget. When RAMS was contacted they agreed to a 10%reduction in their contract costs with the request to add two additional years to their contract. The City Manager agreed to this request with the provision that the Mayor and Council approve the contract extension. The two additional years are for FY 2009-2010 (audit period of FY 08-09) and FY 2010 -2011 (audit period of FY 2009- 2010). There are no other changes to the original agreement (Exhibit 1) attached. Another benefit of extending the City's agreement with RAMS for two additional years is that the City and EDA audit contracts will remain on the same time line. On May 4, 2009, the Redevelopment Agency requested an amendment to their agreement with RAMS to extend services for two additional years for financial audit services. The Community Development Commission approved this request. Keeping the financial audit services contracts on the same time line will allow financial services to be jointly re-bid at the end of the two years which will save both time and money. FINANCIAL IMPACT There are sufficient funds for audit services included in the proposed FY 2009-2010 budget in the General Government division budget RECOMMENDATION Adopt Resolution. t 1 COPY RESOLUTION NO. 2 3 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO AUTHORIZING THE EXECUTION OF AMENDMENT NO. I TO 4 THE AGREEMENT FOR AUDITING SERVICES BY AND BETWEEN THE CITY OF SAN BERNARDINO AND ROGERS ANDERSON MALODY AND SCOTT L.L.P. FOR THE 5 PROVISION OF FINANCIAL AUDITING SERVICES. 6 7 BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY 8 OF SAN BERNARDINO AS FOLLOWS: 9 WHEREAS, the City of San Bernardino desires to enter into Amendment No. 1 10 ("Amendment") to the Agreement for auditing services with Rodgers, Anderson, Malody and 11 Scott, L.L.P., to extend the Agreement for a period of two (2) years in order to perform 12 financial audit services for the City of San Bernardino ("City") as attached. 13 14 NOW, THEREFORE, THE CITY OF SAN BERNARDINO DOES HEREBY 15 RESOLVE, DETERMINE AND ORDER, AS FOLLOWS: 16 SECTION 1. The City Manager is hereby authorized and directed to execute on behalf 17 of said City the Amendment with Rogers Anderson Malody and Scott L.L.P. approving a two 18 (2) year extension to the Agreement to perform financial audit services for the City, for a two 19 (2) year period starting from July 1, 2009 to June 30, 2011. (The audit periods covered will be 20 21 FY 08-09 and FY 09-10.) A copy of which is attached hereto as Exhibit "A" and incorporated 22 herein by reference. Upon execution of said agreement, the Purchasing Manager of the City of 23 San Bernardino is directed to issue a Purchase Order to Rogers Anderson Malody and Scott in 24 the amount not to exceed $54,300 for FY 09-10; and $55,900 for FY 10-11. 25 SECTION 2. The authorization to execute the above referenced agreement is rescinded 26 if the parties to the agreement fail to execute it within sixty (60) days of the passage of this 27 28 resolution. I 2 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO AUTHORIZING THE EXECUTION OF AMENDMENT NO. 1 TO 3 THE AGREEMENT FOR AUDITING SERVICES BY AND BETWEEN THE CITY OF SAN BERNARDINO AND ROGERS ANDERSON MALODY AND SCOTT L.L.P. FOR THE 4 PROVISION OF FINANCIAL SERVICES. 5 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor 6 and Common Council of the City of San Bernardino at an meeting thereof, held 7 on the day of , 2009, by the following vote, to wit: 8 Council Members: AYES NAYS ABSTAIN ABSENT 9 10 ESTRADA 11 BAXTER 12 BRINKER 13 SHORETT 14 KELLEY 15 JOHNSON 16 17 MC CAMMACK 18 19 Rachel G. Clark, City Clerk 20 The foregoing resolution is hereby approved this day of 21 2009. 22 23 Patrick J. Morris, Mayor City of San Bernardino 24 Approved as to Form 25 JAMES F. PENMAN, 26 City Attorney 27 /) BY28 � ,3-, .�✓.,.,- �J .� EXHIBIT A AMENDMENT NO. I TO THE AGREEMENT FOR AUDITING SERVICES (ORIGINAL AGREEMENT APPROVED BY MAYOR AND COMMON COUNCIL ON 7111106 RESOLUTION No. 2006-240) This Amendment No. 1 to the Agreement for Auditing Services ("Amendment No. 1') is made and entered into on this day of August, 2009 by and between the City of San Bernardino, a municipal corporation (hereinafter referred to as "CITY") and Rogers, Anderson, Malody and Scott, L.L.P., Certified Public Accountants (hereinafter referred to as "AUDITORS"). WITNESSETH WHEREAS, the AUDITORS are recognized as competent and qualified certified public accountants who were selected by the CITY through competitive procedures, and are duly authorized to practice and licensed as such by the California State Board of Accountancy; WHEREAS,the CITY approved a three year contract for auditing services with AUDITORS ending 6/30/09(final audit year of 2007-08). WHEREAS,in response to the CITY'S request of vendor to reduce contract cost, AUDITORS agreed to 10%reduction in exchange for a 2 (two) year contract extension NOW, THEREFORE, in consideration of their mutual promises, obligations and.covenants hereinafter contained, the parties hereto agree to the following changes to the original contract: 1. TERM. Unless terminated earlier or cancelled as provided for herein, the term of this Amendment No. 1 shall be extended for each of the two (2) fiscal years ending June 30, 2010 (audit period of FY 08-09); and ending June 30, 2011 (audit period of FY 09-10). 5. COMPLETION OF AUDIT AND DELIVERY OF AUDIT OPINIONS. A. AUDITORS shall complete all work by the dates provided in Appendix A (a copy of which is attached hereto and by this reference made a part hereof) of each fiscal year included in the term of this Amendment No. 1 to the Agreement, but in no event shall any final written audit report, management letter or affiliated report be delivered to the City later than December 1 for the immediately prior fiscal year being audited. B. AUDITORS shall deliver their final typed audit opinions and other reports as set forth in Appendix A for each fiscal year included in the term of this Amendment No. 1 to the Agreement provided CITY furnishes the information to AUDITORS pursuant to Appendix A in a timely manner. A 13. AUTHORITY TO EXECUTE AGREEMENT. Both CITY and AUDITORS do covenant that each individual executing this Amendment No. 1 to the Agreement on behalf of each party is a person duly authorized and empowered to execute agreements for such party. 14. All other provisions of the original agreement approved by Resolution 2006-240 of the Mayor and Council on July 10, 2006, as set forth in Exhibit 1, shall remain in effect through the end of revised contract term. IN WITNESS WHEREFORE, the parties hereto have caused this instrument to be executed the day and year first written above. THE CITY OF SAN BERNARDINO Dated: By: Charles McNeeley, City Manager ATTEST: r^ City Clerk APPROVED AS TO FORM: City Attorney Dated: ROGERS ANDERSON MALODY& SCOTT Terry P. Shea, Partner 2 AMENDMENT NO. l TO THE AGREEMENT FOR AUDITING SERVICES (ORIGINAL AGREEMENT APPROVED BYMAFOR AND COMMON COUNCIL ON 7111106 RESOLUTION No. 2006-240) This Amendment No. 1 to the Agreement for Auditing Services ("Amendment No. 1') is made and entered into on this day of August, 2009 by and between the City of San Bernardino, a municipal corporation (hereinafter referred to as "CITY') and Rogers, Anderson, Malody and Scott, L.L.P., Certified Public Accountants (hereinafter referred to as "AUDITORS'). WITNESSETH WHEREAS, the AUDITORS are recognized as competent and qualified certified public accountants who were selected by the CITY through competitive procedures, and are duly authorized to practice and licensed as such by the California State Board of Accountancy; WHEREAS, the CITY approved a three year contract for auditing services with AUDITORS ending 6/30/09 (final audit year of 2007-08). WHEREAS, in response to the CITY'S request of vendor to reduce contract cost, AUDITORS ti. agreed to 10%reduction in exchange for a 2 (two) year contract extension NOW, THEREFORE, in consideration of their mutual promises, obligations and covenants hereinafter contained, the parties hereto agree to the following changes to the original contract: 1. TERM. Unless terminated earlier or cancelled as provided for herein, the term of this Amendment No. 1 shall be extended for each of the two (2) fiscal years ending June 30, 2010 (audit period of FY 08-09); and ending June 30,2011 (audit period of FY 09-10). 5. COMPLETION OF AUDIT AND DELIVERY OF AUDIT OPINIONS. A. AUDITORS shall complete all work by the dates provided in Appendix A (a copy of which is attached hereto and by this reference made a part hereof) of each fiscal year included in the term of this Amendment No. 1 to the Agreement, but in no event shall any final written audit report, management letter or affiliated report be delivered to the City later than December 1 for the immediately prior fiscal year being audited. B. AUDITORS shall deliver their final typed audit opinions and other reports as set forth in Appendix A for each fiscal year included in the term of this Amendment No. 1 to the Agreement provided CITY furnishes the information to AUDITORS pursuant to Appendix A in a timely manner. 1 13. AUTHORITY TO EXECUTE AGREEMENT Both CITY and AUDITORS do covenant that each individual executing this Amendment No. I to the Agreement on behalf of each party is a person duly authorized and empowered to execute agreements for such party. 14. All other provisions of the original agreement approved by Resolution 2006-240 of the Mayor and Council on July 10, 2006, as set forth in Exhibit 1, shall remain in effect through the end of revised contract term. IN WITNESS WHEREFORE, the parties hereto have caused this instrument to be executed the day and year first written above. THE CITY OF SAN BERNARDINO Dated: By. Charles McNeeley, City Manager ATTEST: City Clerk APPROVED AS TO FORM: y Attomey Dated: . ROGERS ANDERSON MALODY & SCOTT Terry P. Shea, Partner 2 EXHIBIT 1 1 RESOLUTION NO. 2006-240 2 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AGREEMENT 3 BETWEEN THE CITY OF SAN BERNARDINO AND ROGERS ANDERSON MALODY 4 AND SCOTT L.L.P. FOR THE PROVISION OF FINANCIAL AUDITING SERVICES. 5 6 BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY 7 OF SAN BERNARDINO AS FOLLOWS: 8 SECTION 1. The Mayor is hereby authorized and directed to execute on behalf of said 9 City an agreement with Rogers Anderson Malody and Scott L.L.P. relating to financial 10 auditing services, a copy of which is attached hereto as Exhibit "A" and incorporated herein by 11 reference. Upon execution of said agreement, the Purchasing Manager of the City of San 12 Bernardino is directed to issue a Purchase Order to Rogers Anderson Malody and Scott in the 13 amount not to exceed $55,200 for FY 06-07; $56,900 for FY 07-08, and $58,600 for FY 08-09. 14 15 SECTION 2. The authorization to execute the above referenced agreement is rescinded 16 if the parties to the agreement fail to execute it within sixty (60) days of the passage of this 17 resolution. 18 19 20 21 HI 22 23 24 25 26 27 28 1 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF 2 SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AGREEMENT BETWEEN THE CITY OF SAN BERNARDINO AND ROGERS ANDERSON MALODY 3 AND SCOTT L.L.P. FOR THE PROVISION OF FINANCIAL SERVICES. 4 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor 5 joint and Common Council of the City of San Bernardino at an regular meeting thereof, held 6 7 on the 10th day of July 2006, by the following vote, to wit: 8 Council Members: AYES NAYS ABSTAIN ABSENT 9 ESTRADA x- 10 BAXTER x 11 MCGINNIS x 12 DERRY x- 13 KELLEY x 14 15 JOHNSON x 16 MCCAMMACK x 17 L a.k-h_ 18 Rachel G. Clark, City Clerk 19 The foregoing resolution is hereby approved this �.'qt day of July 20 2006. 21 22 a J. Morris, Mayor—' 23 Ctric ity of San Bernardino Approved as to Form 24 JAMES F. PENMAN, 25 City Attorney 26 27 By: 28 i ' 2006-240 AGREEMENT FOR A UDITING SERVICES This Agreement for Auditing Services is made and entered into on this day of June, 2006 by and between the City of San Bernardino, a municipal corporation (hereinafter referred to as -"CITY") and Rogers, Anderson, Malody and Scott, L.L.P., Certified Public Accountants (hereinafter referred to as "AUDITORS"). WITNESSETH WHEREAS, AUDITORS are recognized as competent and qualified certified public accountants who were selected by the CITY through competitive procedures, and are duly authorized to practice and licensed as such by the California State Board of Accountancy; NOW, THEREFORE, in consideration of their mutual promises, obligations and covenants hereinafter contained, the parties hereto agree as follows: 1. TERM. Unless terminated earlier or cancelled as provided for herein, the term of this Agreement shall be for the each of the fiscal year ending June 30, 2007 through 2009. 2. SCOPE OF SERVICES. The AUDITORS agree to provide services and perform all work necessary in a manner satisfactory to the CITY as set forth in the proposal, the request for proposal (RFP) for audit services dated 4/13/2006, and AUDITOR'S proposal dated May 4, 2006. These documents are attached hereto and by reference incorporated herein and made a part hereof. 3. CITY'S OBLIGATIONS. For furnishing services specified in this Agreement, CITY will pay and the AUDITORS shall receive the full compensation as set forth in the proposal attached hereto and by reference incorporated herein and made a part hereof. Additionally, CITY agrees to provide AUDITORS with supporting schedules, trial balances and reconciliations as necessary to complete the services requested. 4. PAYMENT SCHEDULE. The AUDITORS shall submit a monthly billing based on the percentage of audit work completed. After approval of the CITY'S Director of Finance, said invoice shall be paid within 30 days. 5. COMPLETION OF AUDIT AND DELIVERY OF AUDIT OPINIONS. A. AUDITORS shall complete all work by the dates provided in the request for proposal of each fiscal year included in the term of this Agreement. B. AUDITORS shall deliver their final typed audit opinions and other reports as set forth in the proposal for each fiscal year included in the term of this Agreement provided CITY furnishes the information to AUDITORS pursuant to the request for proposal in a timely manner. 2006-240 6. TERMINATION. A. Termination Without Cause. CITY and AUDITORS shall have the right to terminate this Agreement, by giving not less than thirty (30) days written notice of termination to the other party. On the date of termination stated in the written notice. AUDITORS shall discontinue performance of the services, preserve the product of the services, and turn over to CITY the product of the services in accordance with written instructions of CITY. If CITY terminates the Agreement undef this Subsection A of Section 6, CITY shall compensate AUDITORS within thirty (30) days following the effective date of termination a fee for all services satisfactorily provided prior to the effective date of termination based on the amounts and rates set forth in the proposal. If AUDITORS terminate the Agreement under this Subsection A of Section 6, CITY shall compensate AUDITORS in the same amount CITY would compensate AUDITORS in the event CITY terminated the agreement under this Subsection A of Section 6, less any costs CITY pays other auditors to review or re-perform the services provided by AUDITORS prior to the date of termination. In the event of termination without cause by eithe party, CITY's payment as provided herein shall constitute full satisfaction of CITY's obligations under this Agreement. B. Termination by CITY for Cause. 1. CITY may, by written notice to AUDITORS, immediately terminate the whole or any part of this Agreement in any of the following circumstances: a. AUDITORS fail to perform the services required by this Agreement within the time specified herein, or within any extension of that time; b. AUDITORS fail to perform satisfactorily the services called for by this Agreement, or otherwise breaches any provision of this Agreement, and do not correct such failure within a period of ten (10) days or such longer period as CITY may authorize in writing after notice is given by CITY specifying such failure of breach; or C. AUDITORS make a general assignment for the benefit of their creditors, files or have filed against them a petition in bankruptcy, or have a receiver appointed on account of their insolvency. d. AUDITORS fail to maintain the insurance required pursuant to Section 10. 2. Immediately upon receiving written notice of termination, AUDITORS shall discontinue performing services, preserve the product of the services, and turn over to the City the product of the services in accordance with written instructions of CITY. In the event CITY terminates this Agreement in whole or in part as provided above in Paragraph I of this Subsection B of Section 6, CITY shall pay AUDITORS a fee for all services satisfactorily provided by AUDITORS prior to the effective date of termination based on the amounts 2006-240 and rates set forth in the proposal, less any fees CITY pays other auditors to review or re-perform the services provided by AUDITORS prior to the date of termination. Said payment shall constitute full satisfaction of City's obligations under this Agreement. C. Termination by AUDITORS for Cause. AUDITORS may immediately terminate this Agreement if CITY is in breach"of the Agreement and does not correct such breach within a period often (10) days (or such longer period as AUDITORS may authorize in writing) after notice is given by AUDITORS specifying such failure of breach. If AUDITORS terminate the Agreement pursuant to this Subsection C of Section 6, CITY shall compensate AUDITORS within thirty (30) days following the effective date of termination a fee for all services satisfactorily provided prior to the effective date of termination based on the amounts and rates set forth in Appendix B, and such payment shall constitute full-satisfaction of CITY's obligations under this Agreement. 7. NOT OBLIGATION TO THIRD PARTIES. The CITY shall not be obligated or liable hereunder to any party other than the AUDITORS. 8. PROHIBITION AGAINST SUBCONTRACTING OR ASSIGNMENT. The experience, knowledge, capability and reputation of AUDITORS, its principals and employees were a substantial inducement for the CITY to enter into this Agreement. Therefore AUDITORS shall not contract with any other entity to perform in whole or in part the services required hereunder without the express written approval of the CITY. In addition, neither this Agreement nor any interest herein may be transferred, assigned, conveyed, hypothecated or encumbered voluntarily or by operation of law, whether for the benefit of creditors or ` otherwise, without the prior written approval of CITY. Transfers restricted hereunder shall include the transfer to any person or group of persons acting in concert of more than twenty-five percent (25%) of the present ownership and/or control of AUDITORS, taking all transfers into account on a cumulative basis. In the event of any such unapproved transfer, including in any bankruptcy proceeding this Agreement shall be void. No approved transfer shall release any surety of AUDITORS of any liability hereunder without the express consent of CITY. 9. INDEPENDENT CONSULTANT. Neither the CITY nor any of its employees shall have any control over the manner, mode or means by which the AUDITORS, its agents or employees perform the services required herein, except as otherwise set forth. The CITY shall have no voice in the selection, discharge, supervision or control of AUDITORS' employees, servants,representatives or agents, or in fixing their number, compensation or hours of service. AUDITORS agree to maintain continuity of managerial personnel assigned to the engagement except for reasons beyond AUDITORS' control. AUDITORS shall perform all services required herein as an independent contractor of CITY and shall remain at all times to the CITY a wholly independent consultant with only such obligations as are consistent with that role. AUDITORS shall not at any time or in any manner represent that it or any of its agents or employees are agents or employees of CITY. CITY shall not in any way or for any purpose become or be deemed to be a partner of AUDITORS in its business or otherwise of a joint venture or a member of any °` joint enterprise with AUDITORS. 2006-240 10. INSURANCE. The AUDITORS shall procure and maintain, at its cost, comprehensive general liability and property damage insurance, including automobile and excess liability insurance, against all claims for injuries against persons or damages to property resulting from AUDITORS' negligent acts or omissions rising out of or related to AUDITORS' performance under this Agreement. AUDITORS shall also carry Workers' Compensation Insurance in accordance with State Workers' Compensation laws. Said Workers' Compensation Insurance shall be through its business services firm Conrad Business Services, Inc. AUDITORS agree to maintain professional liability insurance to protect CITY from AUDITORS' negligent acts, errors or omissions of a professional nature. If any claim related tot he performance hereunder be asserted against either party hereto, the party claimed against shall receive all reasonable assistance from the other. The requirements herein for subrogation may be waived by the CITY with respect to such professional liability insurance. The insurance required hereunder shall be kept in effect during the term of this Agreement and shall not be subject to reduction in coverage below the limits established herein nor cancellation or termination without thirty (30) days prior written notice by registered letter to the CITY. The insurer shall waive the right of subrogation against CITY, its officers, employees and agents, and the coverage shall be primary for losses arising out of AUDITORS' performance hereunder and neither the CITY nor its insurers shall be required to contribute to any such loss. A certificate evidencing the foregoing and naming the CITY as an additional insured shall be delivered to and approved by the CITY prior to commencement of the services hereunder. The procuring of such insurance or the delivery of policies or certificates evidencing the same shall not be construed as a limitation of AUDITORS' obligation to indemnify the CITY, its officials and employees. The amount of insurance required hereunder shall be as follows: 1. Workers Compensation to statutory limits; 2. Commercial General Liability: Each occurrence $1,000,000 Personal injury $1,000,000 Aggregate limit $2,000,000 3. Hired Auto and Non-Owned Auto Liability: Each occurrence $1,000,000 Aggregate limit $1,000,000 4. Professional Liability: Each claim and in the aggregate $1,000,000 11. PREVAILING PARTY. If any court action occurs as a result of a dispute between the parties concerning any element of this agreement, the prevailing party shall be entitled to reasonable attorney's fees. The costs, salary and expenses of the City Attorney and members of his office in enforcing this agreement on behalf of the City shall be considered as"attorney's fees" for the purpose of this paragraph. 2006-240 12. NOTICE. All written notices to the parties hereto shall be sent by United States mail, postage prepaid by registered or certified mail addressed as follows: CITY: Barbara Pachon, Finance Director City of San Bernardino 300 North"D" Street, 6`h Floor San Bernardino CA 92418 AUDITORS: Terry P. Shea, Partner Rogers Anderson Malody& Scott L.L.P. 290 N"D"Street, Suite 300 San Bernardino CA 92401 13. AUTHORITY TO EXECUTE AGREEMENT. Both CITY and AUDITORS do covenant that each individual executing this Agreement on behalf of each party is a person duly authorized and empowered to execute agreements for such party. IN WITNESS WHEREFORE, the parties hereto have caused this instrument to be executed the day and year first written above. THE CITY OF SAN BERNARDINO r- ''"� Patrick J. orris, a r ATTEST: / City 'lerk APPROVED AS TO FORM: J is F. Penman, City Attorney ROGERS ANDERSON MALODY & SCOTT oe Terry P ea, Partner