2010-21RESOLUTION NO. 2010-21
A RESOLUTION OF THE CITY COMMISSION OF THE
CITY OF AVENTURA, FLORIDA, AUTHORIZING THE
CITY MANAGER ON BEHALF OF THE CITY TO
EXECUTE AND OTHERWISE ENTER INTO THE
ATTACHED AUDIT ENGAGEMENT AGREEMENT
BETWEEN THE CITY OF AVENTURA AND KEEFE,
MCCULLOUGH & CO., LLP; AUTHORIZING THE CITY
MANAGER TO DO ALL THINGS NECESSARY TO CARRY
OUT THE AIMS OF THIS RESOLUTION; AND PROVIDING
AN EFFECTIVE DATE.
WHEREAS, the City of Aventura, pursuant to applicable state law, has solicited
and reviewed proposals from firms to perform the City's independent audit; and
WHEREAS, Resolution No. 2010-17 established a ranking of firms to serve as
said auditor and authorized negotiations with the top ranked firm; and
WHEREAS, City Staff has negotiated fees and scope of services with the top rated firm
(Keefe, McCullough & Co., LLP) and recommends approval of the Audit Engagement
Agreement.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE
CITY OF AVENTURA, FLORIDA, THAT:
Section 1. The City Manager is hereby authorized on behalf of the City of
Aventura to execute and otherwise enter into that certain Audit Engagement Agreement
between the City of Aventura and Keefe, McCullough & Co., LLP for auditing services.
Section 2. The City Manager is hereby authorized to do all things necessary
and expedient in order to effectuate the execution of the attached Agreement described
in Section 1 above, and to carry out the aims of this Resolution.
Section 3. This Resolution shall become effective immediately upon its
adoption.
The foregoing Resolution was offered by Commissioner Joel, who moved its
adoption. The motion was seconded by Commissioner Auerbach, and upon being put to
a vote, the vote was as follows:
Commissioner Zev Auerbach yes
Commissioner Bob Diamond yes
Commissioner Teri Holzberg yes
Commissioner Billy Joel yes
Commissioner Michael Stern absent
Commissioner Luz Urbaez-Weinberg yes
Mayor Susan Gottlieb yes
Resolution No. 2010-.Z!
Page 2
PASSED AND ADOPTED this 4th day of May, 010.
USAN GOTTLIEB, MAY R
ATTES
T RESA . S OKA MMC
ITY CLE
APPROVED AS TO GAL SUF CIENCY:
CITY ATTORNEY
AUDITOR AGREEMENT
THIS IS AN AGREEMENT, dated the 5'h day of May, 2010, by and between:
THE CITY OF AVENTURA, a municipal corporation of the State of Florida,
with a business address of 19200 West Country Club Drive, Aventura, Florida
33180, hereinafter referred to as "CITY,"
and
Keefe, McCullough & Co., LLP, Certified Public Accountants, authorized to do
business in the State of Florida, with a business address of 6550 N. Federal
Highway, Suite 410, Ft. Lauderdale, FL 33308, hereinafter referred to as
"AUDITORS."
WITNESSETH:
In consideration of the mutual terms and conditions, promises, covenants and payments
hereinafter set forth, CITY and AUDITORS agree as follows:
ARTICLE 1
PREAMBLE
In order to establish the background, context and form of reference for this Agreement and to
generally express the objectives, and intentions of the respective parties herein, the following
statements, representations and explanations shall be accepted as predicates for the
undertakings and commitments included within the provisions which follow and may be relied
upon by the parties as essential elements of the mutual considerations upon which this
Agreement is based.
1.1 On January 10, 2010, the CITY advertised its request for proposal No. 10-02-08-2
(hereinafter, "RFP") which set forth the CITY's desire to hire a firm to provide:
Independent Audit Services for the City of Aventura
RFP No. 10-02-08-2
1.2 On February 8, 2010, the responses to the RFP were opened at the offices of the City
Manager.
1.3 On April 6, 2010, the CITY Commission selected and ranked three (3) firms from the
list of proposers and authorized the CITY Administration to negotiate the terms of an
agreement with the highest proposer.
1.4 On May 4, 2010, the CITY awarded the RFP to AUDITORS and authorized the proper
City officials to enter into this Agreement with AUDITORS to render the professional
services more particularly described herein below.
Page 1 of 11
1.5 Negotiations pertaining to the services to be performed by the AUDITORS were
undertaken and this Agreement incorporates the results of such negotiation..
ARTICLE 2
SERVICES AND RESPONSIBILITIES
2.1 AUDITORS hereby agree to perform the professional auditing services described in
request for proposal No. 10-02-08-2 Section III labeled "NATURE OF SERVICES
REQUIRED" attached hereto as Exhibit "A." In case of a conflict or a perceived
conflict, between the terms and conditions set forth in Exhibit "A" and the
AUDITORS Proposal for Annual Independent Audit Services, Exhibit "A" shall
govern.
2.2 During the conduct of the audit, AUDITORS shall schedule regular meetings, with the
CITY's Finance Director or designee at least weekly to discuss the progress of the
work.
2.3 AUDITORS shall furnish all services, labor, equipment, and materials necessary and
as may be required in the performance of this Agreement and all work performed
under this Agreement shall be done in a professional manner.
2.4 AUDITORS hereby represent to CITY, with full knowledge that CITY is relying upon
these representations when entering into this Agreement with AUDITORS, that
AUDITORS have the professional expertise, experience and manpower to perform
the services to be provided by AUDITORS pursuant to the terms of this Agreement.
ARTICLE 3
TIME FOR PERFORMANCE
AUDITORS shall perform the services identified in Article 2 and Exhibit "A" hereof and
deliver to the CITY in final form the report of the independent auditor, management letter, the
single audit report, and any other report as required for each fiscal year by no later than
February 17th of each year for the City's Audit and no later than August 20"' for the Charter
School audit of each year during the term of this Agreement. Minor adjustments to the
timetable for completion approved by CITY in advance, in writing, will not constitute non-
performance by AUDITORS per this Agreement. Additional services requested by City
Manager, or changes in scope, will be reviewed and any impact on the schedule determined
and the schedule modified accordingly.
Page 2 of 11
ARTICLE 4
DELAY IN PERFORMANCE
4.1 Liauidated Damaaes for Dela
4.1.1 CITY shall be entitled to retain the sum of One Hundred and Fifty Dollars ($150.00)
for each day, or part thereof,. that the work remains uncompleted beyond the timetable
set forth in Article 3 hereof when such delay is caused by the failure of the AUDITOR
to perform as agreed herein. It is recognized and agreed that damages in such
events are difficult to ascertain, though great and irreparable, and that this agreement
with respect to liquidated damages shall in no event disentitle CITY to injunctive relief
and this sum is not construed as a penalty.
4.1.2 Anything to the contrary notwithstanding minor adjustments to the timetable for
completion approved by CITY in advance, in writing, will not constitute a delay by
AUDITORS for which liquidated damages are due. Furthermore, a delay due to an
Act of God, fire, lockout, strike or labor dispute, riot or civil commotion, act of public
enemy or other cause beyond the control of AUDITORS shall extend this Agreement
for a period equal to such delay and during this period such delay shall not constitute
a delay by AUDITORS for which liquidated damages are due.
ARTICLE 5
COMPENSATION AND METHOD OF PAYMENT
5.1 CITY agrees to compensate AUDITORS for all services performed by AUDITORS
pursuant to the provisions of this Agreement in AN AMOUNT NOT TO EXCEED Fifty-
Five Thousand Dollars ($55,000.00) (the "Fee"). This amount may not be exceeded
without a written amendment to this Agreement. This Fee is broken down for each
segment of the various required audits as follows:
Compensation for City's Annual Audit 42 000.00
These Fees include out-of-pocket expenses and the cost of drafting, typing and
binding twenty-five (25) copies of the Comprehensive Annual Financial Report
(CAFR) and providing a "converted" (not scanned) signed electronic copy in PDF.
Page 3 of 11
Compensation for Charter School Annual Audit 13 000.00
These Fees include out-of-pocket expenses and the cost of drafting, typing and
binding twenty-five (25) copies of the Audited Financial Statements of the Charter
School and providing a "converted" (not scanned) signed electronic copy in PDF.
The Fee for subsequent contract years, ending 2011, 2012, 2013 and 2014 will be adjusted
from the current contract Fee using the Consumer Price Index for "All Urban Consumers for
Miami\Fort Lauderdale, Florida" as published by the U.S. Department of Labor Statistics or its
successor agency for the twelve (12) months ending July of each year to be effective for the
next engagement.
5.2 Method of Billing and Payment.
5.2.1 AUDITORS shall be entitled to invoice monthly based on the hours of work completed
during the course of the engagement and out-of-pocket expenses incurred as
accepted by CITY. Invoices shall be submitted in sufficient detail to demonstrate
compliance with the terms of this Agreement.
5.2.2 CITY will make its best efforts to pay AUDITORS within thirty (30) days of receipt of
proper invoice the total shown to be due on such invoice.
5.2.3 Payment will be made to AUDITORS at:
Keefe, McCullough & Co., LLP
Certified Public Accountants
6550 N. Federal Highway, Suite 410
Fort Lauderdale, FL 33308
ARTICLE 6
CHANGES IN SCOPE OF WORK
CITY or AUDITORS may request changes that would increase decrease or otherwise modify
the. Scope of Services to be provided under this Agreement. Such changes must be in
accordance with the provisions of the Code of Ordinances of the CITY and must be
contained in a written amendment, executed by the parties hereto, with the same formality
and with equality and dignity prior to any deviation from the terms of this Agreement,
including the initiation of any extra work. In no event will the AUDITORS be compensated for
any work which has not been described in a separate written agreement executed by the
parties hereto. Provided, however, notwithstanding the foregoing if the addition of such
additional services will not exceed the Fee set forth in 5.1 above and the AUDITORS agree
to be compensated in accordance with the hourly rate set forth in Exhibit "B" the City
Manager may authorize such additional work in writing.
Page 4 of 11
ARTICLE 7
MISCELLANEOUS
7.1 Ownership of Documents. Reports, surveys, studies and other data provided in
connection with this Agreement are and shall remain the property of CITY whether or
not the project for which they are made is completed.
7.1.1 AUDITORS further acknowledge that CITY may post its audited financial statements
on CITY's website. Such statements may be posted by CITY without the prior
authorization of AUDITORS. No additional fee or compensation will be paid to the
AUDITORS by CITY for such posting.
7.1.2 The CITY will include its audited financial statements in any offering statement without
the prior authorization of the AUDITORS. AUDITORS acknowledge that they will
assist and provide their services to CITY, at no additional expense to CITY, in the
event that CITY requests AUDITORS to review and provide comments on the
unaudited material or information associated with any audited financial statement
which is included in an offering statement related to any bond transaction of CITY.
7.2 Term and Termination.
7.2.1 This Agreement may be terminated by either party for cause, or by the CITY for
convenience, upon thirty (30) days written notice by the CITY to AUDITORS in which
event the AUDITORS shall be paid their compensation for services performed to
termination date. In the event that the AUDITORS abandon this Agreement or cause
it to be terminated, they shall indemnify the CITY against any loss pertaining to this
termination up to a maximum of the full contracted fee amount. All finished or
unfinished documents, data, studies, surveys and reports prepared by AUDITORS
shall become the property of CITY and shall be delivered by AUDITORS to CITY.
7.2.2 This Agreement shall take effect as of the date of award by the City Commission and
shall end upon the AUDITORS completion of the work described herein, however,
such date shall not be later than no later than February 17, 2012 for the City's Audit
and no later than August 20, 2012 for the Charter School audit0. Thereafter, this
Agreement may be renewed for three (3) additional one (1) year periods subject to
Agreement by both parties, and providing that all terms, conditions and specifications
remain the same.
Page 5 of 11
7.3 Records. AUDITORS shall keep books and records and require any and all
subcontractors to keep books and records as may be necessary in order to record
complete and correct entries as to personnel hours charged to this engagement, and
any expenses for which AUDITORS expect to be reimbursed. Such books and
records will be available at all reasonable times for examination and audit by CITY
and shall be kept for a period of three (3) years after the completion of all work to be
performed pursuant to this Agreement, unless contacted by CITY and advised such
records must be kept for a longer period. AUDITORS shall further be required to
respond to the reasonable inquiries of successor auditors and allow successor
auditors to review AUDITORS' working papers related to matters of continuing
accounting, reporting or auditing significance. Incomplete or incorrect entries in such
books and records will be grounds for disallowance by CITY of any fees or expenses
based upon such entries.
7.4 Indemnification.
7.4.1 The AUDITORS shall protect, defend, reimburse, indemnify and hold harmless the
CITY and the CITY'S officers, agents and employees free and harmless from and
against any and all claims, losses, penalties, damages, settlements, costs, charges,
attorneys or other professional fees, or other expenses or liabilities of every kind and
character arising out of or relating to any and all claims, liens, demands, obligations,
actions or proceedings directly or indirectly arising out of or resulting from the
mistakes or negligence, gross negligence, willful and wanton acts and the
performance of this Agreement by the RUDITORS, or their respective officers,
employees, agents, servants, partners or principals. The AUDITORS agree to
investigate, respond, adjust and provide a defense for any such claims, demands,
and actions at AUDITORS' sole expense and agrees to bear and remain liable for all
such other costs and expenses relating thereto, even if such claim is groundless, false
or fraudulent. Notwithstanding the foregoing, AUDITORS' indemnity shall not extend
to liability for damages to persons or property to the extent such damage was caused
by any act, omission, or default of the CITY, or by the CITY'S officers, agents and
employees.
7.4.2 The parties recognize that various provisions of this Agreement, including but not
necessarily limited to this Section, provide for indemnification by the AUDITORS and
that Florida law may require a specific consideration be given therefore. The parties
therefore agree that the sum of Ten Dollars and 00/100 ($10.00), receipt of which is
hereby acknowledged, is the specific consideration for such indemnities, and the
providing of such indemnities is deemed to be part of the specifications with respect to
the services to be provided by AUDITORS. Furthermore, the parties understand and
agree that the covenants and representations relating to this indemnification provision
shall survive the term of this Agreement and continue in full force and effect as to the
party's responsibility to indemnify.
Page 6 of 11
7.5 Insurance.
7.5.1 The AUDITORS shall not commence work under this Agreement until they have
obtained all insurance required under this paragraph and such insurance has been
approved by the City Manager of the CITY nor shall the AUDITORS allow any
Subcontractor to commence work on his sub-contract until all similar such insurance
required of the subcontractor has been obtained and approved.
7.5.2 Certificates of insurance, reflecting evidence of the required insurance shall be filed
with the City's Risk Manager prior to the commencement of this Agreement. These
Certificates shall contain a provision that coverage's afforded under these policies will
not be cancelled until at least forty-five days (45) prior written notice has been given to
the CITY. Policies shall be issued by companies authorized to do business under the
laws of the State of Florida. Financial Ratings must be not less than "A-V I" in the
latest edition of "Best Key Rating Guide," published by A.M. Best Guide.
7.5.3 Insurance shall be in force until the obligations required to be fulfilled under the terms
of the Agreement are satisfied. In the event the insurance certificate provided
indicates that the insurance shall terminate and lapse during the period of this
Agreement, then in that event, the AUDITORS shall furnish, at least forty-five (45)
days prior to the expiration of the date of such insurance, a renewed certificate of
insurance as proof that equal and like coverage for the balance of the period of the
Agreement and extension there under is in effect. The AUDITORS shall not
commence nor continue to provide any services pursuant to this Agreement unless all
required insurance remains in full force and effect. AUDITORS shall be liable to CITY
for any lapses in service resulting from a gap in insurance coverage.
7.5.4 REQUIRED INSURANCE
7.5.4.1. PROFESSIONAL LIABILITY insurance. Limit of $1,000,000 per occurrence
The City does not require AUDITORS to name City as "additional insured"
7.5.4.2. WORKERS' COMPENSATION insurance shall be maintained during the life of
this Agreement to comply with statutory limits for all employees, and in the
case any work is sublet, the AUDITORS shall require the Subcontractors
similarly to provide Workers' Compensation Insurance for all the tatter's
employees unless such employees are covered by the protection afforded by
the AUDITORS. The AUDITORS and their subcontractors shall maintain
during the life of this policy Employers Liability Insurance. The following limits
must be maintained:
Workers' Compensation Statutory
Employer's Liability $100,000 -Each Accident
$500,000 -Disease-policy limit
$100,000 -Disease-each employee
Page 7 of 11
If AUDITORS claim to be exempt from this requirement, AUDITORS shall provide CITY
proof of such exemption along with a written request for CITY to exempt AUDITORS,
written on AUDITORS' letterhead.
7.5.4.3 The CITY reserves the right to require any other insurance coverage it deems
necessary depending upon the exposures.
7.6 Independent Contractor. This Agreement does not create an employee/employer
relationship between the parties. It is the intent of the parties that the AUDITORS are
independent contractors under this Agreement and not the CITY's employees for all
purposes, including but not limited to, the application of the Fair Labor Standards Act
minimum wage and overtime payments, Federal Insurance Contribution Act, the
Social Security Act, the Federal Unemployment Tax Act, the provisions of the Internal
Revenue Code, the State Workers' Compensation Act, and the State unemployment
insurance law. The AUDITORS shall retain sole and absolute discretion in the
judgment of the manner and means of carrying out AUDITORS' activities and
responsibilities hereunder. The AUDITORS agree that they are a separate and
independent enterprise from the CITY, that they have full opportunity to find other
business, that they have to make their own investment in their business, and that they.
will utilize a high level of skill necessary to perform the work. This Agreement shall
not be construed as creating any joint employment relationship between the
AUDITORS and the CITY and the CITY will not be liable for any obligation incurred by
AUDITORS, including but not limited to unpaid minimum wages and/or overtime
premiums.
7.7 Assignments Amendments.
7.7.1 This Agreement, or any interest herein, shall not be assigned, transferred or otherwise
encumbered, under any circumstances, by AUDITORS without the prior written
consent of CITY. However, this Agreement shall run to the benefit of CITY and its
successors and assigns.
7.7.2 It is further agreed that no modification, amendment or alteration in the terms or
conditions contained here shall be effective unless contained in a written document
executed with the same formality and of equal dignity herewith.
7.8 No Contingent Fees. AUDITORS warrant that they have not employed or retained
any company or person, other than a bona fide employee working solely for the
AUDITORS to solicit or secure this Agreement, and that they have not paid or agreed
to pay any person, company, corporation, individual or firm, other than a bona fide
employee working solely for AUDITORS any fee, commission, percentage, gift, or
other consideration contingent upon or resulting from the award or making of this
Agreement. For the breach or violation of this provision, the CITY shall have the right
to terminate the Agreement without liability at its discretion, to deduct from the
contract price, or otherwise recover the full amount of such fee, commission,
percentage, gift or consideration.
Page 8 of 11
7.9 Notice. Whenever any party desires to give notice unto any other party, it must be
given by written notice, sent by registered United States mail, with return receipt
requested, addressed to the party for whom it is intended, at the places last specified,
and the places for giving of notice shall remain such until they shall have been
changed by written notice in compliance with the provisions of this section. For the
present, the AUDITORS and the CITY designate the following as the respective
places for giving of notice:
CITY: Eric M. Soroka, City Manager
City of Aventura
19200 West Country Club Drive
Aventura, FL 33180
Telephone No. (305) 466-8910
Facsimile No. (954) 466-8919
Copy To: Weiss Serota Helfman Pastoriza Cole & Boniske, P.L.
200 East Broward Blvd., Suite 1900
Fort Lauderdale, FL 33301
Telephone No. (954) 763-4242
Facsimile No. (954) 764-7770
AUDITORS: Keefe, McCullough & Co., LLP
Certified Public Accountants
6550 N. Federal Highway, Suite 410
Fort Lauderdale, FL 33308 '
7.10 Binding Authority. Each person signing this Agreement on behalf of either party
individually warrants that he or she has full legal power to execute this Agreement on
behalf of the party for whom he or she is signing, and to bind and obligate such party
with respect to all provisions contained in this Agreement.
7.11 Headings. Headings herein are for convenience of reference only and shall not be
considered on any interpretation of this Agreement.
7.12 Exhibits. Each Exhibit referred to in this Agreement forms an essential part of this
Agreement. The exhibits if not physically attached should be treated as part of this
Agreement and are incorporated herein by reference.
7.13 Severability. If any provision of this Agreement or application thereof to any person or
situation shall to any extent, be held invalid or unenforceable, the remainder of this
Agreement, and the application of such provisions to persons or situations other than
those as to which it shall have been held invalid or unenforceable shall not be affected
thereby, and shall continue in full force and effect, and be enforced to the fullest
extent permitted by law.
Page 9 of 11
7.14 Governing Law. This Agreement shall be governed by the laws of the State of
Florida with venue lying in Miami-Dade County, Florida. The parties hereby voluntarily
waive any right to trial by jury in any litigation between the parties which, in any way,
arises out of or concerns this Agreement or the course of dealing between the parties.
7.15 Extent of Agreement. This Agreement represents the entire and integrated
agreement between the CITY and the AUDITORS and supersedes all prior
negotiations, representations or agreements, either written or oral.
IN WITNESS OF THE FOREGOING, the parties have set their hands and seals the day and
year first written above.
CITY CF AVE
BY: ~
ERIC M. SOROKA, C'~TY M9 AGER
ATTEST: ,~ ~''
,
~~ r~,.,>
~' .LE K
E
t
,~
APPROVED AS TO F RM.
OFFICE OF THE TY ATTORN Y
WITNESSES:
f ~ ,~"
ATTEST: ~~
SECRETARY
AUDITOR ',
BY: ~ ~~~
Print Nam WILLIAM G. B NSON C.P.A.
Tltle: PARTNER
STATE OF FLORIDA
COUNTY OF BROWARD
BEFORE ME, an officer duly authorized by law to administer oaths and take acknowledgments,
personally appeared WILLIAM G. BENSON, C.P.A. as PARTNER of
KEEFE , MCCULLOUGH & CO . , LLP ,Certified Public Accountants, and acknowledged they executed the
foregoing Agreement as the proper official of KEEFF,.} M .. T ..0 T ,H & .n, for the use and purposes
mentioned in it and that the instrument is the act and deed of KEEFE , MCCULLOUGH & CO, LLP
Page 10 of 11
IN WITNESS OF THE FOREGOING, I have set my hand and official seal at in the State and County
aforesaid on this 15th day of APRIL , 2010.
j ,~
NOTARY PUBLIC
My Commission Expires:
'~1~•= Comm scion # DD 928845
=; :; ~ Expires October 1, 207ms
'' ~:•` Borded TMu Troy Fain Insurance
~R{: ^+•
Page 11 of 11
Exhibit A
CITY OF AVENTURA INDEPENDENT AUDIT SERVICES RFP #10-02-08-2
III. NATURE OF SERVICES REQUIRED
A. General
The City of Aventura is soliciting the services of qualified firms of
Independent Certified Public Accountants to audit the financial statements
for the City of Aventura for the fiscal year ending 9-30-2010, and the financial
statements of the Aventura City of Excellence Charter School for the fiscal
year ending 6-30-2011, and any required Special Reports such as Grants or
other compliance reporting, as well as auditing those financial statements
and other Special Reports for the subsequent fiscal year. These audits are
to be performed in accordance with the provisions contained in this Request
for Proposal.
B. Scope of Work to be Performed
The City of Aventura desires the independent auditor to express an
opinion on the fair presentation of the basic financial statements of the
City and the Aventura City of Excellence Charter School chartered by the
City and Miami-Dade District School Board, in conformity with generally
accepted accounting principles.
2. The City of Aventura also desires the auditor to express an opinion on the
fair presentation of its government-wide and fund financial statements
and schedules in conformity with generally accepted accounting
principles. The auditor is not required to audit the supporting schedules
contained in the comprehensive annual financial report. However, the
auditor is to provide an "in-relation-to" opinion on the supporting
schedules based on the auditing procedures applied during the audit of
the government-wide and fund financial statements and schedules. The
auditor is not required to audit the introductory section of the report or the
statistical section of the report.
3. The auditor shall also be responsible for performing certain limited
procedures involving required supplementary information required by the
Governmental Accounting Standards Board as mandated by generally
accepted auditing standards.
4. The auditor is required to audit the schedule of expenditures of Federal
and State awards in accordance with the Federal and Florida Single Audit
Act respectively.
The auditor is not required to audit the Aventura City of Excellence Charter
School for the fiscal year ending June 30, 2010, as the School will be audited
by McGladrey & Pullen, LLP who will furnish their report to the principal
Independent Auditor during the engagement.
Exhibit A - 1 of 5
CITY OF AVENTURA INDEPENDENT AUDIT SERVICES RFP #10-02-08-2
C. Auditing Standards to be Followed
-,,,.,~-
To meet the requirements of this request for proposals, the audit shall be
performed in accordance with:
1. Generally Accepted Auditing Standards as set forth by the American
Institute of Certified Public Accountants;
2. The standards for financial audits set forth in the U.S. General
Accounting Office's Government Auditing Standards (2003 Revision);
3. The provisions of the Federal Single Audit Act of 1984 (as amended in
1996 and subsequently);
4. The Florida Single Audit Act;
5. The provisions of U.S. Office of Management and Budget (OMB) Circular
A-133;
6. Audits of States, Local Governments, and Non-Profit Organizations,
Audits of State and Local Governments (Revised) - AICPA.
7. Section 11.45, Florida Statutes;
8. State of Florida Department of Banking and Finance Regulations;
9. Rules adopted by the State of Florida Auditor General for form and
content of governmental unit audits;
10.Any other applicable Federal, State and local laws or regulations;
Any updates of, or amendments to, these described auditing standards are
to be incorporated in future audits performed by the selected auditor
performing auditing engagements for the City of Aventura in future fiscal
years.
Exhibit A - 2 of 5
CITY OF AVENTURA INDEPENDENT AUDIT SERVICES RFP #10-02-OS-2
D. Reports to be Issued
Following the completion of the audit of the City of Aventura financial
statement for the fiscal year ending September 30`h~ and subsequently,
following the completion of the audit of the Aventura City of Excellence
Charter School financial statement for the fiscal year ending June 30'h, the
auditor shall issue:
A Report of Independent Certified Public Accountants on the fair
presentation of the financial statements in conformity with accounting
principles generally accepted in the United States, pursuant to an audit
conducted in accordance with auditing standards generally accepted in
the United States and the standards applicable to financial audits
contained in Government Auditing Standards, issued by the Comptroller
General of the United States.
2. A Report of Independent Certified Public Accountants on Compliance
and on Internal Control over Financial Reporting based on an audit of
Financial Statements Performed in Accordance with Government
Auditing Standards.
3. A Report of Independent Certified Public Accountants on Compliance
and Internal Control over Compliance Applicable to Each Major Federal
Awards Program and State Financial Assistance Project.
4. Management Letter in Accordance with the Rules of the Auditor General
of the State of Florida.
5. In the required report[s] on compliance and internal controls, the auditor
shall communicate any reportable conditions found during the audit. A
reportable condition shall be defined as a significant deficiency in the
design or operation of the internal control structure, which could
adversely affect the organization's ability to record, process, summarize
and report financial data consistent with the assertions of management in
the financial statements.
6. In addition, the following conditions shall be considered reportable:
Reportable conditions that are also material weaknesses shall be
identified as such in the report.
Non-reportable conditions discovered by the auditors shall be
reported in a separate Management Letter, which shall be referred to
in the report[s] on compliance and internal controls.
7. The reports on compliance and internal controls shall include all
Exhibit A - 3 of 5
CITY OF AVENTURA _ INDEPENDENT AUDIT SERVICES RFP #10-02-08-2
instances of noncompliance.
Irregularities and illegal acts. The auditors shall be required to make an
immediate, written report to the Finance Director and City Manager of all
irregularities and illegal acts or indications of illegal acts of which they
become aware.
Reporting to the Finance Director and the City Manager. Auditors shall
also disclose the following:
a) The auditor's responsibility under generally accepted auditing
standards, and assurances that the independent auditor is
currently licensed, and that the members of the audit team have
the minimum required Continuing Professional Education credits
required for performing audits under Governmental Auditing
Standards.
b) Significant accounting policies.
c) Management judgments and accounting estimates.
d) Significant audit adjustments.
e) Other information in documents containing audited financial
statements.
f) Disagreements with management.
g) Management consultation with other accountants.
h) Major issues discussed with management prior to retention.
i) Difficulties encountered in performing the audit.
E. Special Considerations
1. The City of Aventura will send its Comprehensive Annual Financial
Report (CAFR) to the Government Finance Officers Association of the
United States and Canada for review in their Certificate of Achievement
for Excellence in Financial Reporting program. It is anticipated that the
auditor will be required to provide any special assistance deemed
necessary to the City in order to meet the requirements of that program.
2. The City of Aventura currently anticipates that it will not issue any official
statements in connection with the sale of debt securities. However, if the
City determines it to be in their best interest to issue new debt or
Exhibit A - 4 of 5
CITY OF AVENTURA INDEPENDENT AUDIT SERVICES RFP #10-02-08-2
refinance existing debt the official statements may be required which will
contain the general purpose financial statements and the auditor's report
thereon. The auditor shall be required, if requested by the fiscal advisor
and/or the underwriter, to issue a "consent and citation of expertise" as
the auditor and any necessary "comfort letters."
3. The City of Aventura owns and operates one (1) charter school that is
chartered by Miami-Dade Public Schools. This school. is included as
Special Revenue Fund of the City, and operates on a fiscal year ended
June 30th. The City is required to separately audit the financial
statements of the Charter School.
4. The Schedule of Expenditures of Federal Awards and State Financial
Assistance Projects and related auditor's report, as well as the reports on
compliance and internal controls are to be issued as part of the CAFR.
5. A list of findings and other weaknesses from the City of Aventura most
recent financial statement audit are attached to this document (Appendix
A).
F. Working Paper Retention and Access to Working Papers
All working papers and reports must be retained, at the auditor's expense, for
a minimum of three (3) years, unless the firm is notified in writing by the City
of Aventura of the need to extend the retention period. The auditor will be
required to make working papers available, upon request, to the following
parties or their designees:
City of Aventura
Cognizant agency(s) pursuant to OMB Circular A-133
U.S. General Accounting Office (GAO)
Auditor General of the State of Florida
Parties designated by the federal or state governments or by the City
of Aventura as part of an audit quality review process.
Auditors of entities of which the City of Aventura is a recipient or a
sub-recipient of grant funds.
In addition, the firm shall respond to the reasonable inquiries of successor
auditors and allow successor auditors to review working papers relating to
matters of continuing accounting, reporting or auditing significance.
Exhibit A - 5 of 5
~~~• y
~~k;
JOHN R. KEEFE, C.P.A.
STEVEN H. WOODS, C.P.A.
DAVID T. WILLIAMS, C.P.A.
JOSEPH D. LEO, C.P.A.
WILLIAM G. BENSON, C.P.A.
KENNETH G. SMITH, C.P.A.
LOUIS R. PROIETTO, C.P.A.
CYNTHIA L. CALVERT, C.P.A.
ISRAEL 1. GOMEZ, C.P.A.
JAMES R. CARAWAY, C.P A.
JOHN E. McCULLOUGH, C.P.A. (RETIRED)
THOMAS T. CARPENTER, C.P A.(RETIRED)
PAUL B. SNEIDER, C.P.A. (RETIRED)
BRIAN D. PINNELL, C.P.A. (RETIRED)
ROSS S. GOTTHOFFER, C.P.A.
6550 NORTH FEDERAL HIGHWAY
SUITE 4I0
FORT LAUDERDALE, FLORIDA 33308
(954)771-0896
FAX: (954) 938-9353
E-MAIL: kmcC~kmccpa.com
May 5, 2010
Mr. Eric M. Soroka, City Manager
City of Aventura, Florida
19200 West Country Club Drive
Aventura, FL 33180
Mr. Soroka:
We are pleased to confirm our understanding of the services we are to provide for the year
ended September 30, 2010 and 2011 (City of Aventura, Florida) and June 30, 2011 and 2012
(Aventura City of Excellence Charter School). Thereafter, this agreement may be renewed for
three (3) additional one (1) year periods subject agreement by both parties, and providing that all
terms, conditions and specifications remain the same.
We will audit the financial statements of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information, which collectively
comprise the basic financial statements, of the City of Aventura, Florida as of and for the year
ended September 30, 2010 and 2011 and the Aventura City of Excellence Charter School as of
and for the year ended June 30, 2011 and 2012. Accounting standards generally accepted in the
United States provide for certain required supplementary information (RSI), such as
management's discussion and analysis (MD&A), to accompany the basic financial statements. As
part of our engagement, we will apply certain limited procedures to the City of Aventura, Florida
and Aventura City of Excellence Charter School's RSI. These limited procedures will consist
principally of inquiries of management regarding the methods of measurement and presentation,
which management is responsible for .affirming to us in its representation letter. Unless we
encounter problems with the presentation of the RSI or with procedures relating to it, we will
disclaim an opinion on rt. The following RSI is required by generally accepted accounting
principles and will be subjected to certain limited procedures, but will not be audited:
1. Management's Discussion and Analysis.
2. Budgetary Comparison Information.
3. Pension Fund and Other Post Employment Benefits (OPEB) Schedules.
Supplementary information other than RSI, also. accompanies City of Aventura, Florida and
the Aventura City of Excellence Charter School's basic financial statements, as applicable. We
will subject the following supplementary information to the auditing procedures applied in our
audit of the basic financial statements and will provide an opinion on it in relation to the basic
financial statements:
1. Combining and Individual Fund Statements.
2.. Schedule of Expenditures of Federal Awards.
KEEFE, 1~CCULLC)L?GH &, C®., LL.P
CERTIFIED PUBLIC ACCOtiNTA1~TS
3. Schedule of Expenditures of State Financial Assistance.
City of Aventura, Florida -2- May 5, 2010
The following additional information accompanying the basic financial statements will not be
subjected to the auditing procedures applied in our audit of the financial statements, and for which
our auditor's report will disclaim an opinion:
1. Introductory Section.
2. Statistical Section
Audit Objectives
The objective of our audit is the expression of opinions as to whether your basic financial
statements are fairly presented, in all material respects, in conformity with U. S. 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 basic 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/projects and an opinion (or disclaimer of opinion)
on compliance with laws, regulations, and the provisions of contracts or grant agreements that
could have a direct and material effect on each major program/project in accordance with the
Single Audit Act Amendments of 1996, OMB Circular A-133, Audits of States, Local
Governments, and Non-Profit Organizations, and the Florida Single Audit Act as contained in the
provisions of Chapter 10.650, Rules of the Auditor General.
The reports on internal control and compliance will each include a statement that the report is
intended solely for the information and use of management, the body or individuals charged with
governance, others within the entity, specific legislative or regulatory bodies, federal and state
awarding agencies, and if applicable, pass-through entities and is not intended to be and should
not be used by anyone other than these specified parties.
Our audit will be conducted in accordance with auditing standards generally accepted in the
United States of America; 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; the provisions of OMB Circular A-133; the Florida Single Audit Act and
the provisions of Chapter 10.650, Rules of the Auditor General and will include tests of
accounting records, a determination of major program/project(s) in accordance with OMB
Circular A-133 and the Florida Single Audit Act, .and other procedures we consider necessary to
enable us to express such opinions and to render the required reports. If our opinions on .the
financial statements or the Single Audit compliance opinions are 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 opinions, we may decline to express opinions or to
issue a report as a result of this engagement.
Management Responsibilities
Management is responsible for the basic financial statements and all accompanying
information as well as all representations contained therein. Management is also responsible for
preparation of the schedule of expenditures of federal awards and state financial assistance in
accordance with the requirements of OMB Circular A-133 and Chapter 10.650, Rules of the
Auditor General. As part of the audit, we will assist with preparation of your financial statements,
schedule of expenditures of federal awards and state financial assistance, and related notes. You
are responsible for making all management decisions and performing all management functions
relating to the financial statements, schedule of expenditures of federal awards and state financial
City of Aventura, Florida -3- May 5, 2010
assistance, and related notes and for accepting full responsibility for such decisions. You will be
required to acknowledge in the management representation letter our assistance with preparation
of the financial statements and the schedule of expenditures of federal awards and state financial
assistance and that you have reviewed and approved the financial statements, schedule of
expenditures of federal awards and state financial assistance, and related notes prior to their
issuance and have accepted responsibility for them. Further, you are required to designate an
individual with suitable skill, knowledge, or experience to oversee any nonaudit services we
provide and for evaluating the adequacy and results of those services and accepting responsibility
for them.
Management is responsible for establishing and maintaining effective internal controls,
including internal controls over compliance, and for monitoring ongoing activities, to help ensure
that appropriate goals and objectives are met. You are also responsible for the selection and
application of accounting principles; for the fair presentation in the financial statements of the
respective financial position of the governmental activities, the business-type activities, each
major fund, and the aggregate remaining fund information of the City of Aventura, Florida and
the respective changes in financial position and, where applicable, cash flows in conformity with
U.S. generally accepted accounting principles; and for compliance with applicable laws and
regulations and the provisions of contracts and grant agreements.
Management is also responsible for making all financial records and related information
available to us and for ensuring that management and financial information is reliable and
properly recorded. Your responsibilities also include identifying significant vendor relationships
in which the vendor has responsibility for program compliance and for the accuracy and
completeness of that information. Your responsibilities include adjusting the financial statements
to correct material misstatements and confirming to us in the representation letter that the effects
of any uncorrected misstatements aggregated by us during the current engagement and pertaining
to the latest period presented are immaterial, both individually and in the aggregate, to the
financial statements taken as a whole.
You are responsible for the design and implementation of programs and controls to prevent
and detect fraud, and for informing us about all known or suspected fraud or illegal acts affecting
the government involving (1) management, (2) employees who have significant roles in internal
control, and (3) others where the fraud or illegal acts could have a material effect on the financial
statements. Your responsibilities include informing us of your knowledge of any allegations of
fraud or suspected fraud affecting the government received in communications from employees,
former employees, grantors, regulators, or others. In addition, you are responsible for identifying
and ensuring that the entity complies with applicable laws, regulations, contracts, agreements, and
grants. Additionally, as required by OMB Circular A-133 and Chapter 10.650, Rules of the
Auditor General, 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.
Management is responsible for establishing and maintaining a process for tracking the status
of audit findings and recommendations. Management is also responsible for identifying for us
previous financial audits, attestation engagements, performance audits, or other studies related to
the objectives discussed in the Audit Objectives section of this letter. This responsibility includes
relaying to us corrective actions taken to address significant findings and recommendations
resulting from those audits, attestation engagements, performance audits, or studies. You are also
responsible for providing management's views on our current findings, conclusions, and
recommendations, as well as your planned corrective actions, for the report, and for the timing
and format for providing that information.
City of Aventura, Florida -4- May 5, 2010
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 from (1) errors, (2) fraudulent financial reporting, (3)
misappropriation of assets, or (4) violations of laws or governmental regulations that -are
attributable to the entity or to acts by management or employees acting on behalf of the entity.
Because the determination of abuse is subjective, Government Auditing Standards do not expect
auditors to provide reasonable assurance of detecting abuse.
Because an audit is designed to provide reasonable, but not absolute assurance and because we
will not perform a detailed examination of all transactions, there is a risk that material
misstatements or noncompliance may exist and not be detected by us. In addition, an audit is not
designed to detect immaterial misstatements or violations of laws or governmental regulations that
do not have a direct and material effect on the financial statements or major programs/projects.
However, we will inform you of any material errors and any fraudulent financial reporting or
misappropriation of assets that come to our attention. We will also inform you of any violations of
laws or governmental regulations 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 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, funding sources, 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 require certain written
representations from you about the financial statements and related matters.
Audit Procedures-Internal Controls
Our audit will include obtaining an understanding of the entity and its environment, including
internal control, sufficient to assess the-risks of material misstatement of the financial statements
and to design the nature, timing, and extent of further audit procedures. 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 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 financial statements. 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 and Chapter 10.650, Rules of the Auditor General, we
will perform tests of controls over compliance 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/state award program/project.
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 and Chapter 10.650, Rules of the Auditor General.
City of Aventura, Florida -5- Inlay 5, 2010
An audit is not designed to provide assurance on internal control or to identify significant
deficiencies. However, during the audit, we will communicate to management and those charged
with governance internal control related matters that are required to be communicated under
AICPA professional standards, Government Auditing Standards, OMB Circular A-133, and
Chapter 10.650, Rules of the Auditor General.
Audit Procedures-Compliance
As part of obtaining reasonable assurance about whether the financial statements are free of
material misstatement, we will perform tests of 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 and Chapter 10.650, Rules of the Auditor General, require 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/projects. Our procedures will consist of tests of transactions and
other applicable procedures described in the OMB Circular A-133 and Compliance Supplement
and Chapter 10.650, Rules of the Auditor General, for the types of compliance requirements that
could have a direct and material effect on each of the City of Aventura, Florida and the Aventura
City of Excellence Charter School's major programs/projects, as applicable. The purpose of these
procedures will be to express an opinion on City of Aventura, Florida and the Aventura City of
Excellence Charter School's compliance with requirements applicable to each of its major
programs/projects in our report on compliance issued pursuant to OMB Circular A-133 and
Chapter 10.650, Rules of the Auditor General, as applicable..
Engagement Administration, Fees, and Other
We understand that your employees will prepare all audit confirmations we request and will
locate any documents selected by us for testing.
At the conclusion of the engagement, we will complete the appropriate sections of the Data
Collection Form that summarizes our audit findings. 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 corrective action plan) along with
the Data Collection Form to the federal audit clearinghouse. We will coordinate with you the
electronic submission and certification. If applicable, we will provide copies of our report for you
to include with the reporting package you will submit 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.
The audit documentation for this engagement is the property of Keefe, McCullough & Co.,
LLP and constitutes confidential information. However, pursuant to authority given by law or
regulation, we may be requested to make certain audit documentation available to agent or its
designee, afederal/state agency providing direct or indirect funding, or the U.S. Governmental
Accountability Office for purposes of a quality review of the audit, to resolve audit findings, or to
carry out oversight responsibilities. We will notify you of any such request. If requested, access
to such audit documentation will be provided under the supervision of Keefe, McCullough & Co. ,
LLP personnel. Furthermore, upon request, we may provide copies of selected audit
documentation to the aforementioned parties. These parties may intend, or decide, to distribute
the copies or information contained therein to others, including other governmental agencies.
City of Aventura, Florida -6- Iv1ay 5, 2010
The audit documentation for this engagement will be retained for a minimum of five years
after the report release or for any additional period requested by you or a federal/state agency. If
we are aware that afederal/state awarding agency, pass-through entity, or auditee is contesting an
audit finding, we will contact the party(ies) contesting the audit finding for guidance prior to
destroying the audit documentation.
Our fee for services rendered will be based upon the difficulty of your engagement and the
time and skill level of our personnel assigned. Work is assigned, according to its complexity, to
the appropriate member of our staff. Our fee for this engagement will not exceed $ 55,000 as
follow:
City of Aventura, Florida $ 42,000
Aventura City of Excellence Charter School's $ 13,000
An invoice for the services provided will be presented at the completion of the engagement or
at the end of each monthly billing period, whichever occurs first. Payment of our invoice is due
when rendered.
The fee for subsequent contract years, City of Aventura, Florida (2011, 2012, 2013, 2014)
and Aventura City of Excellence Charter School (2012, 2013, 2014, 2015), will be adjusted from
the current contract fee using the Consumer Price Index for "All Urban Consumers for
Miami/Fort Lauderdale, Florida" as published by the U.S. Department of Labor Statistics or its
successor agency for the twelve (12) months ending July of each year to be effective for the next
engagement.
The Auditors' Agreement dated May 5, 2010, the Request for Proposal No. 10-02-08-2, and
this letter collectively constitute the complete and exclusive statement of agreement between
Keefe, McCullough & Co., LLP and the City of Aventura, Florida. In case of conflict or a
perceived conflict between the terms and conditions of these three documents, the Auditors'
Agreement dated May 5, 2010 shall govern.
Government Auditing Standards require that we provide you with a copy of our most recent
external peer review report and any letter of comment, and any subsequent peer review reports
and letters of comment received during the period of the contract. Our 2008 peer review report
accompanies this letter.
We appreciate the opportunity to be of service to the City of Aventura, Florida and the
Aventura City of Excellence Charter School 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.
UGH & CO, LLP
C.P.A.
City of Aventura, Florida -7-
RESPONSE:
May S, ?010
This letter correctly sets forth the understanding of City of Aventura, Florida, and Aventura
City of Excellence Charter School.
,:~~ _
By: ~ `
Title: ~-~'
Date: .~,~~F
~`'