HomeMy WebLinkAboutReso 96-059 - Approving the contract for professional services between the COR & Nystom & CO and Authorizing the Mayor to sign same ,� - ' � �
RESOLUTION NO. �� �-�9
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF REDDING APPROVING
THE CONTRACT FOR PROFESSIONAL SERVICES BETWEEN THE CITY OF REDDING
AND NYSTROM& COMPANY, AND AUTHORIZING THE MAYOR TO SIGN SAME.
IT IS HEREBY RESOLVED by the City Council of the City of Redding as follows:
1. That the City Council of the City of Redding herby approves the Contract for Professional
Services between the City of Redding and Nystrom& Company, a true copy of which is attached
hereto and incorporated herein by reference; and
2. That the mayor of the City of Redding is hereby authorized and directed to sign said
Contract and all necessary documents on behalf of the City of Redding, and the City Clerk is
herby authorized and directed to attest the signature to the signature of the Mayor and to impress
the official seal of the City of Redding on the aforesaid documents, when appropriate.
I HEREBY CERTIFY that the foregoing Resolution was introduced and read at a regular
meeting of the City Council of the City of Redding on the �9 th day of Mar�h ,1996,
and was duly adopted at said meeting by the following vote:
AYES: COIJNCIL MEMBERS: P. Anderson, R. Anderson, McGeorge, Murray and Kehoe
NOES: COUNCIL MEMBERS: None
ABSENT: COLJNCIL MEMBERS: None
ABSTAIN: COLTNCIL MEMBERS: None
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DAVID E, Mayor
City of Redding
ATTEST: FORM APPROVED:
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CONNIE STR HMAYL ity Clerk W. LEONARD WIN TE, City Attorney �
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CONTRACT FOR PROFESSIONAL AUDITING SERVICES
THIS AGREEMENT made and entered into this day of March 1996, by and
between the CITY OF REDDING, a Municipal Corporation organized under the general laws of the
State of California, hereinafter referred to as"Cit}�'and NYSTROM & COMPANY, Certified Public
Accountants, whose principal office is located in Redding, Califomia, hereinafter referred to as
"Auditor";
WITNESSETH:
WHEREAS, California law requires that the financial affairs of a general law City be audited
annually; and
WHEREAS, Auditor is comprised of Certified Public Accountants licensed by the State of
California who possess the experience, sldll and expertise to perform the financial examination;
NOW, THEREFORE, in consideration of the mutual promises and covenants hereinafter set
forth, it is MUTUALLY UNDERSTOOD and AGREED as follows:
A. SCOPE OF WORK
1. The examination of the City's financial statements shall be of the type described by
the following:
Audits of State and Local Governmental Units, Sth Edirion
American Institute of Certified Public Accountants
Statement No. 1
National Council on Governmental Accounting as adopted by:
Statement No. 1
Governmental Accounting Standards Board
2. The examination shall be conducted in accordance with generally accepted auditing
standards as presented in:
Statements on Auditing Standards
American Institute of Certified Public Accountants
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Government Auditing Standards, 1994 Edition
U. S. General Accounting Office
3. The examination and resultant reports shall be in compliance with the requirements
of the Single Audit Act of 1984, Federal Public Law 98-502, and the implemenring regulations
prescribed in the following:
Circular No. A-128. Audits of State and Local Government
Office of Management and Budget
Compliance Su�lement for Single Audits of State and Local Governments
Office of Management and Budget
In addition, the examination and resultant report on the operations of the Redding Area Bus
Authority shall be in compliance with the requirements of Title 21, Chapter 3, Subchapters 2 and 2.5
of the California Code of Regularions.
4. The examination shall result in the expression of an opinion in compliance with Rule
�- 58.1 of the State Board of Accountancy. 1'his opinion shall be expressed on the City's combined
financial statements (general purpose financial statements) and on the supplemental information
presented, in relation to the general purpose financial statements taken as a whole.
In addition, the examination shall result in the expression of separate opinions on the financial
reports of the Redding Redevelopment Agency and the Redding Area Bus Authority.
5. The examination shall cover the financial activity of the City and of the separate legal
entities which are a part of the City's reporting entity, as defined by generally accepted accounting
principles. The funds and account g�-oups currently considered necessary to present the financial
activity of the City's reporting entity are as follows:
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Governmental Fund-Types:
General Fund 1
Special Revenue Funds 6
Debt Service Funds 5
Capital Proj ects Funds 4
Proprietary Fund-Types:
Enterprise Funds 8
Intemal Service Funds 5
Fiduciary Fund-Types
Agency Funds 5
Account Groups:
General Fixed Asset 1
Long-term Debt 7
City will continue to make additions and/or delerions to this list and to the component units included
in the reporting enrity as deemed necessary.
6. If conditions are discovered which lead to the belief that material errors, defalcarions,
or other irregularities may exist, or if any other circumstances are encountered that require extended
services, Auditor shall promptly advise the Finance Officer and/or the City Manager of City, or the
audit committee of the City Council, depending on the circumstances involved. No extended services
shall be performed unless authorized by a separate contractual agreement or by an amendment to the
existing agreement.
B. REOUIRED REPORTS
1. The following reports shall be required for each fiscal year of the contract period:
(a) Auditor shall present Re�grts on the Examination of the Financial Statements
for the financial statements of the City's reporting entity, the Redding
Redevelopment Agency, and the Redding Area Bus Authority.
The scope of the reports and the Auditor's opinions presented with
such reports shall comply with the provisions of Scope of Work, Section A,
above.
(b) Auditor shall present the Report on ComQliance. Ret�ort on Intemal Control
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Stnzcture Re�ort on the Schedule of Federal Financial Assistance, Report on
the Internal Structu-e Schedule of Finding�, and Questioned Costs and other
Compliance Reports as re�uired regarding the activities of the City's reporting
entity.
The reports shall be in compliance with the provisions of the Single
Audit Act of 1984, OMB Circular No. A-128 as amended, and the related
Compliance Supplement for Single Audits of State and Local Governments
promulgated by the U.S. Comptroller General and governmental auditing
standards.
Specific format and requirements of these reports shall be coordinated
with the City's cognizant agency, the Federal Department of Housing and
Urban Development.
A separate report on the compliance of Redding Area Bus Authority
operations with the Transportation Development Act, the California Code of
Regulations, and the rules and regulations of the Shasta County Regional
Transportation Planning Agency shall be presented as prescribed by Section
6667 of the California Administrative Code.
(c) Auditor shall present Mana�ement Letters for the reporting entity of
the City, the Redding Redevelopment Agency, and the Redding Area Bus
Authority.
These reports shall set forth (1) findings and recommendations for
improvements in the systems of internal control: (2) findings and
recommendations for improvements in accounting systems; (3) findings of
noncompliance with laws, rules and regulation; and(4) any other material items
coming to the attention of Auditor during the course of the examination.
(d) Other Reports:
Auditor shall present other reports as required by the long-term debt
agreements of the City, or any of its component units.
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(e) Financial Statement Pre arn ation
The Auditor will perform either of the following two basic options, as specified
by the City:
I. Option One
i. City will prepare the Comprehensive Annual Financial Report
(CAFR). Auditors will not prepare the CAFR but will trace their
audit balances into the completed CAFR prepared by the City.
II. Option Two
i. The Finance Office sha.11 provide completed worksheets of account
balances sufficient in quality to allow Auditor to prepare the financial
statements. In addition, it is understood that these worksheet balances
will represent final balances. If a significant number of changes are
made to the work sheet balances by the Finance Division that require
the Auditor to modify the financial statements, the Auditory may seek
a modification of this agreement.
ii. City shall provide completed trial balances for Redding
Redevelopment Agency and Redding Area Bus Authority subject to
the same provisions as in paragraph B 1(e)two above.
iii. City shall provide Auditor with the required worksheets by
October 31, of each year of the term of this agreement. Auditor wil]
submit print-ready copies of the CAFRs by the later of November 30
or thirty days after the City's delivery of the worksheets.
iv. The Finance Department shall prepare the data required for the
cash and investment foomotes for the City's CAFR and for the
CAFRs of Redding Redevelopment Agency and Redding Area Bus
Authority.
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v. The Auditor shall submit a diskette containing the CAFR in final
form in Work Perfect 6.1 or other mutually agreeable software by
December 15 of each year of this agreement. Such diskettes are the
property of the City.
C. DELIVERY OF REPORTS
The reports, except any required communications or management letters, required by this
Agreement shall be delivered to:
Finance Officer
City of Redding
760 Parkview Avenue
Redding, California 96001-3396
Any required communications or management letters issued in connection with this agreernent
will be delivered to the Audit Com.mittee.
Delivery of Auditor's Re�orts on the Examination of Financial Statements will be made no
� later than 30 days after the City delivers trial balances to the Auditors each year. Delivery of other
required reports will be made no later than December 1 each year.
D. EXIT CONFERENCE
An exit conference shall be held prior to the preparation of the final drafts of any reports. The
City shall be afforded adequate opportunity to respond to all findings and to have such responses
included in the reports, where applicable.
E TERM AND TERMINATION
1. This aereement shall commence when executed by the Mayor of City, or designee, and
by the Auditor, and shall continue until delivery of the final reports for the fiscal year ending
June 30, 1998, to the Finance Officer of City.
2. �The City shall reserve the right to extend the term of this Agreement for two additional
one-year terms.
3. This Agreement may be cancelled without cause by City upon ninety (90) days'
advance notice to the Auditor. Auditor shall be paid for any satisfactory work completed as of the
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time the notice of cancellation is received by Auditor.
F. TERMINATION OF CONTRACT FOR CAUSE
1. If, through any cause, Auditor shall fail to fulfill its obligations under this Agreement
in a timely and proper manner, or if Auditor shall violate any of the covenants, agreements or
stipularions of this Agreement, City shall thereupon have the right to terminate this Agreement by
giving written notice to Auditor of such termination, and specifying the effective date thereof, at least
5 (five) days before the effective date of such termination. In such event, all finished or unfinished
statements and reports prepared by Auditor under this Agreement shall, at the option of City, become
the property of City, and Auditor shall be entitled to receive just and equitable compensation for any
work satisfactorily completed hereunder.
2. Notwithstanding the above, Auditor shall not be relieved of liability of City for
damages sustained by City by virtue of any breach of this Agreement by Auditor, and City may
withhold any payments to Auditor for the purpose of set-off until such rime as the exact amount of
� damages due City from Auditor is determined.
G. COMPENSATION AND BILLING
1. Compensation for the work to be performed shall be determined based on actual hours
worked multiplied by Auditor's hourly rates for each staff classification. Such compensation shall
not exceed the following amounts for each fiscal year:
Fiscal Year Ending: Option One Option Two
June 30, 1996 $34,000 $41,500
June 30, 1997 $35,250 $42,750
June 30, 1998 $36,500 $44,000
The City has the right to select either Option One as described in section B1(e)I or Option Two as
descnbed in section B 1(e)II. The City will inform the Auditor in writing as to its choice of Options
for the CAFR on or before October 15 of each year of the contract.
2. Auditor may request monthly progress payments. Such payments shall be for work
actually performed, and shall be based on Auditor's hourly rates for each staff classification. In no
event shall the combination of all progress payments exceed eighty percent(80%)of the annual total
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compensation.
3. Final payment will be made after successful completion of all services and reports to
the satisfaction of the Finance Officer of the City.
4. Progress payments and final billings shall be in a form satisfactory to identify the audit
costs attributable to each entity, grant, or fund, which will be needed to assist in charging each
organization for their share of the audit costs. Such biilings will reflect the category of tasks
completed, the persons who performed them, and the number of hours to perform the tasks.
5. In the event that extra work is authorized by City, the hourly rates for the individual
performing said work shall be those quoted in the "Proposal to Provide Independent Auditing
Services for the City of Redding for the Fiscal years ending June 30, 1996, 1997, and 1998"
submitted by Auditor.
6. Auditor reserves the right to negotiate a revised maximum fee should any government
agency or professional organization materially change an entity's auditing or reporting requirements
after this agreement or any amendments thereto have been signed by both parties.
H. PERSONNEL
1. It is required that at least fifty percent (50%)of the prior year's audit staff repeat for
the following year's audit.
2. Auditor represents that it has or will secure, at its own expense, all personnel required
in performing thc services under this Agreement. Such personnel shall not be employees of or have
any contractual relationship with City, the Redding Redevelopment Agency, the Redding Housing
Authority, the Redding Area Bus Authority or the Redding Community Access Channel.
3. All of the services required hereunder will be performed by Auditor or under its
supervision, and all personnel engaged in the work shall be fully qualified and shall be authorized or
permitted under State and local laws to perform such services.
4. None of the work or services covered by this Agreement shall be subcontracted
without the prior written approval of City. Any work or services subcontracted hereunder shall be
specified by written contract or agreement, and shall be subj ect to each provision of this Agreement.
5. Auditor will provide adequate supervision of all personnel engaged by Auditor.
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6. The City hereby agrees to provide an individual to coordinate the audit with Auditor
whose ability and training is comparable to that of the individual performing that function during the
prior year. Auditor hereby agrees to provide an individual to supervise the audit whose ability and
training is comparable to that of the individual performing that function during the prior year.
I. RETENTION OF RECORDS
Auditor sha.11 retain the audit work papers and related audit reports for a minimum of five (5)
years, and shall allow City staff, the staff of the General Accounting Office of the United States, the
staff of the cognizant agency, and/or the staff of a subsequent auditor of the City to review any and
all such work papers, documents and reports related to the audit.
J. FINDINGS CONFIDENTIAL
All of the reports, informarion, data, etc., prepared or assembled by Auditor under this
Agreement are confidential, and Auditor agrees that they shall not be made available to any individual
._ or organization without the prior written approval of City.
K. AUDITOR PROFILE
1. Auditor shall be properly licensed to practice as a certified public accounting fum.
2. Auditor shall meet the independence requirements of the Standards for Audit of
Governmental Organizations. Programs. Activities and Functions published by the Comptroller
General of the United States.
L. INTEREST OF AUDITOR AND ITS EMPLOYEES
Auditor covenants, for itself and its employees, that it presently has no interest, and shall not
acquire any interest, direct or indirect, which would conflict in any manner or degree with the
performance of its services hereunder. Auditor further covenants that in the performance of this
Agreement, no person having any such interest shall be employed by it.
M. INSURANCE REQUIREMENTS
Auditors shall procure and maintain for the duration of the contract insurance against claims
for injuries to persons or damages to property; which may arise from or in connection with the
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performance of the work hereunder by the Auditor, his agents, representatives, employees or
subcontractors.
1. Minimum Scope of Insurance
Coverage shall be at least as broad as:
(a) Insurance Services Office Commercial General Liability coverage (occurrence
from CG 0001).
(b) Worker's Compensation insurance as required by the State of California and
Employers' Liability Insurance.
(c) Errors and Omission Liability insurance appropriate to the Auditor's
profession.
2. Minimum Limits of Insurance
Auditor shall maintain limits no less than:
(a) General Liability: $1,000,000 per occurrence for bodily injury,personal injury
and property damage. If Commercial General Liability or other form with a
general aggregate limit is used, the general aggregate limit shall be twice the
required occurrence limit.
(b) Employer's Liability: $1,000,000 per accident for bodily injury or disease.
(c) Enors and Omissions Liability: $1,000,000 per occurrence.
3. Deductibles and Self-Insured Retentions
Any deducribles or self-insured retentions must be declared to and approved by the
City. At the option of the City, either: the insurer shall reduce or eliminate such deductibles or self-
insured retentions as respects the City, its ofiicers, officials, employees and volunteers; or the Auditor
shall procure a bond guaranteeing payment of losses and related investigations, claims administration
and defense expenses.
4. Other Insurance Provisions
The general liability policy is to contain, or be endorsed to contain, the following
provisions:
(a) The City, its officers, officials, employees, and volunteers are to be covered
as insureds as respects: liability arising out of work or operations performed
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by or on behalf of the Auditor; or automobiles owned, leased, hired or
borrowed by the Auditor.
(b) For any claims related to this project, the Auditor's insurance coverage shall
be primary insurance as respects the City, its officers, officials, agents and
volunteers. Any insurance or self-insurance maintained by the City, its
officers, officials, employees, agents or volunteers shall be excess of the
Auditor's insurance and shall not contribute to it.
(c) Each insurance policy required by this clause shall be endorsed to state that
coverage shall not be cancelled by except after thirty (30) days prior written
notice has been given to the City.
5. Acceptability of Insurers
Insurance is to be placed with insurers admitted in the State of California with a
current A.M. Best's rating of no less than A:VII, unless otherwise acceptable to the City.
5. Verificarion of Coverage
The Auditor selected for the engagement will be required to furnish the City with
certificates of insurance and original endorsements effecting coverage required by this clause. The
endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf.
All endorsements are to be received and approved by the City before work commences.
N. INDEPENDENT CONTRACTOR
The relationship of Auditor to City will be that of independent contractor, and not agent or
employee.
O. ASSIGNMENT
City will not recognize any assignment of funds to be received under this Agreement by
Auditor.
P. OFFICE HOURS
Auditor shall perform all services during normal office hours of City or such other schedule
approved by the Finance Officer.
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� NOTICE
Any notices or demands that may be given by either party hereunder, including notice of
default and notice of terminarion, shall be deemed to have been fully and properly given when made
in writing, enclosed in a sealed envelope and deposited in the United States Post Office, certified mail,
postage prepaid, addressed as follows: To City c%Finance Officer, City of Redding, 760 Parkview
Avenue, Redding, California 96001-3396; and to Auditor at 1726 Court Street, Redding, California
96001.
R. CEOA
It has been determined that this matter is not subject to the provisions of the California
Environmental Quality Act.
S. ATTORNEY FEE
In the event suit or action is instituted to enforce any of the provisions of this Agreement, the
�� prevailing party therein shall be entitled to attomey's fees and other sums as may be adjudged
reasonable and necessary at trial and on appeal.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement in the presence
of their officers duly authorized in that behalf on the date and year first above written.
CITY OF REDDING
By:
DAVID KEHOE, Mayor
NYSTROM & COMPANY
By:
L. BRUCE ROBERTS, Partner
ATTEST:
CONNIE STROHMAYER, City Clerk
FORM �OVED:
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W. LEONaRD WIN A E, City Attorney
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