HomeMy WebLinkAboutReso 91-370 - Approve agreement for professional services between the COR and D H Scott & Company RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF REDDING
APPROVING THE AGREEMENT FOR PROFESSIONAL SERVICES BETWEEN
THE CITY OF REDDING AND D. H. SCOTT & 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 hereby
approves the Agreement for Professional Services between the City
of Redding and D. H. Scott & 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 Agreement and all necessary documents on
behalf of the City of Redding, and the City Clerk is hereby
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 3rd day of September , 199 and was
duly adopted at said meeting by the following vote:
AYES: COUNCIL MEMBERS: Arness, Buffum, Fulton, Moss &.Dahl
NOES: COUNCIL MEMBERS: None
ABSENT: COUNCIL MEMBERS: None
ABSTAIN: COUNCIL MEMBERS: None
MIKE DAHL, Mayor
City of Redding
ATTEST: FORM APPROVED:
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ETHEL A. NIC OLS, City Clerk R ALL A. HAYS, Cit Attorney �O
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AGREEMENT FOR PROFESSIONAL AUDITING SERVICES
THIS AGREEMENT made and entered into this
i day of
September, 1991, by and between the CITY OF REDDING, a Municipal
Corporation organized under the general laws of the State of
California, hereinafter referred to as "City" and D. H. SCOTT &
COMPANY, Certified Public Accountants, whose principal office is
located in Redding, California, hereinafter referred to as
"Auditor";
W I T N E S S E T H:
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,
skill 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, 5th Edition
American Institute of Certified Public Accountants
Statement No. 1 +
National Council on Governmental Accounting
as adopted by:
Statement No. 1
Governmental Accounting Standards Board
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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
Standards for Audit of Governmental Organizations,
Programs, Activities and Functions, 1988 Revision
Comptroller General of the Unites States
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 implementing regulations
prescribed in the following:
Circular No. A-128, Audits of State and Local Government
Office of Management and Budget
Compliance Supplement for Single Audits of State and
Local Governments
Comptroller General of the United States.
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 Regulations.
4. The examination shall result in the expression of an
opinion in compliance with Rule 58. 1 of the State Board of
Accountancy. This opinion shall be expressed on the City' s 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 component unit financial reports of the
Redding Redevelopment Agency and the Redding Area Bus Authority.
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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 groups currently
considered necessary to present the financial activity of the
` City's reporting entity are as follows:
Governmental Fund-Types:
General Fund 1
Special Revenue Funds 7
Debt Service Funds 3
Capital Projects Funds 2
Proprietary Fund-Types:
Enterprise Funds 7
Internal 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 deletions to this list
and to the component units included in the reporting entity as
deemed necessary.
6. If conditions are discovered which lead to the belief
that material errors, defalcations, or other irregularities may
exist, or if any other circumstances are encountered that require
extended services, Auditor shall promptly advise the Director of
Finance 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.
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B. REQUIRED REPORTS
1. The following reports shall be required for each fiscal
year of the contract period:
(a) Auditor shall present Reports 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 Compliance
Report on Internal Control Structure Report on the
Schedule of Federal Financial Assistance, Report on the
Study and Evaluation of Internal Control Systems
Schedule of Findings and Ouestioned Costs and other
Compliance Reports as required 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,
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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 Title 21, Chapter 3, Subchapters 2 and 2. 5
of the California Code of Regulations.
(c) Auditor shall present Management 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 court 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.
(e) Financial Statement Preparation:
1. Auditor shall compile the combined statements,
combining statements and footnote disclosures for the
City of Redding and the Redding Redevelopment Agency and
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the Redding Area Bus Authority. Auditor will 11 provide
print-ready originals to the City of Redding for these
sections of the Combined Annual Financial Report ("CAFR" )
and Component Unit Financial Reports ("CUFR") .
2. The Director of the City Finance Department
shall 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
worksheet balances by the Finance Department that require
the Auditor to modify the financial statements, the
Auditor may seek a modification of this agreement as
described in paragraph A6 of this agreement.
3 . City shall provide completed trial balances for
Redding Redevelopment Agency and Redding Area Bus
Authority subject to the same provisions as in paragraph
B1(e)2 above.
4. City shall provide Auditor with the required
worksheets by October 1 of each year of the term of this
agreement. Auditor will submit print-ready copies of the
CAFR and CUFRs by the later of November 15 or thirty days
after the City's delivery of the worksheets.
5. The Finance Department shall prepare the data
required for the cash and investment footnotes for the
City's CAFR and for the CUFRs of Redding Redevelopment
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Agency and Redding Area Bus Authority.
6. The Auditor shall submit a diskette containing
the CAFR in final form in Word Perfect 5.1 or other
mutually agreeable software by December 1 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:
Director of Finance
City of Redding
760 Parkview Avenue
Redding, California 96001-3396
Any required communications or management letters issued in
connection with this agreement will be delivered to the Audit
Committee.
Delivery of Auditor's Reports on the Examination of Financial
Statements will be made no later than November 25th each year.
Delivery of other required reports will be made no later than
December 16th each year.
D. EXIT CONFERENCE
An exit conference shall be conducted with Auditor and Finance
Management and the Audit Committee at least two (2) weeks prior to
the preparation of the final drafts of any reports. City shall be
afforded adequate opportunity to respond to all findings and to
have such responses included in the reports, where applicable.
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E. TERM AND TERMINATION
1 . This Agreement 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 ,
1993 , to the Director of Finance 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 written notice to Auditor. Auditor
shall be paid for any satisfactory work completed as to the 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
stipulations 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 five ( 5) 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.
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2 . Notwithstanding the above, Auditor shall not be relieved
of liability to 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 time as
the exact amount of damages due City from Auditor is determined.
G. COMPENSATION AND BILLING
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:
June 30, 1991 $ 41,300
June 30, 1992 $ 42,800
June 30, 1993 $ 44, 300
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 ( 800) of the annual total compensation.
3 . Final payment will be made after successful completion of
all services and reports to the satisfaction of the Director of the
Department of Finance of 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
billings will reflect the category of tasks completed, the persons
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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 applicable to such work shall be at Auditor's standard
rate for the individual performing said work.
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 the 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
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written contract or agreement, and shall be subject to each
provision of this Agreement.
5. Auditor will provide adequate supervision of all
personnel engaged by Auditor.
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 shall 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, information, 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.
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R. AUDITOR PROFILE
1. Auditor shall be properly licensed to practice as a
certified public accounting firm.
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
Auditor 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
performance of the work hereunder by the Auditor, his agents,
representatives, or employees.
Minimum Scope of Insurance - Coverage shall be at least as
broad as:
1. Insurance Services Office Commercial General Liability
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coverage (occurrence form CG 0001) .
2. Insurance Services Office form number CA 0001 (Ed.1/87)
covering Automobile Liability, code 1 (any auto) .
3 . Workers' Compensation insurance as required by the State
of California and Employer's Liability Insurance.
4. Errors and omissions liability insurance appropriate to
the Auditor's profession.
Minimum Limits of Insurance - Auditor shall maintain limits
no less than:
1. General Liability: $1,000,000 per occurrence for bodily
injury, personal injury and property damage. If
Commercial General Liability Insurance or other form with
a general aggregate limit is used, either the general
aggregate limit shall apply separately to this
project/location or the general aggregate limit shall be
twice the required occurrence limit.
2. Automobile Liability: $1,000,000 per accident for bodily
injury and property damage.
3. Employer's Liability: $1,000,000 per accident for bodily
injury or disease.
4. Errors and omissions liability: $1,000,000 per
occurrence.
Deductibles and Self-Insured Retentions - Any deductibles 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
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respects the City, its officers, officials, employees and
volunteers; or the Auditor shall procure a bond guaranteeing
payment of losses and related investigations, claim administration
and defense expenses.
Other Insurance Provisions - The general liability and
automobile liability policies are to contain, or be endorsed to
contain, the following provisions:
1. The City, its officers, officials, employees and
volunteers are to be covered as insureds as respects:
liability arising out of activities performed by or on
behalf of the Auditor, products and completed operations
of the Auditor, premises owned, occupied or used by the
Auditor, or automobiles owned, leased, hired or borrowed
by the Auditor. The coverage shall contain no special
limitations on the scope of protection afforded to the
City, its officers, officials, employees or volunteers.
2. For any claims related to this project, the Auditor's
insurance coverage shall be primary insurance as respects
the City, its officers, officials, employees and
volunteers. Any insurance or self-insurance maintained
by the City, its officers, officials, employees or
volunteers shall be excess of the Auditor's insurance and
shall not contribute with it.
3 . Any failure to comply with reporting or other provisions
of the policies including breaches of warranties shall
not affect coverage provided to the City, its officers,
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officials, employees or volunteers.
4. The Auditor's insurance shall apply separately to each
insured against whom claim is made or suit is brought,
except with respect to the limits of the insurer's
liability.
5. Each insurance policy required by this clause shall be
endorsed to state that coverage shall not be suspended,
voided, cancelled by either party, reduced in coverage
or in limits except after thirty (30) days' prior written
notice by certified mail, return receipt requested, has
been given to the City.
Acceptability of Insurers - Insurance is to be placed with
insurers with a current A.M. Best's rating of no less than A:VII,
unless otherwise acceptable to the City.
Verification of Coverage - Auditor shall furnish the City with
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. The endorsements are to
be on forms provided by the City. All endorsements are to be
received and approved by the City before work commences. As an
alternative to the City's forms, the Auditor's insurer may provide
complete certified copies of all required insurance policies,
including endorsements effecting the coverage required by these
specifications.
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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 Director of the
Finance Department.
O. NOTICE
Any notices or demands that may be given by either party
hereunder, including notice of default and notice of termination,
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/o Director of Finance, City of Redding, 760
Parkview Avenue, Redding, California 96001-3396; and to Auditor at
900 Market 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.
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S. ATTORNEY FEES
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 attorney's fees and other sums as may be
adjudged reasonable and necessary at trial and on appeal.
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:
MIKE DAHL, Mayor
D. H. SCOTT & COMPANY
By:
ATTEST: DAVID S OTT, C.P.A.
ETHEL A. NICHOLS, City Clerk
FORM PRO
/1� a�
RANDAL A. ITAYS, City Attorney
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