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Res No 078-96-9832WHEREAS, Article IV, Section 3E of the City Charter of South Miami requires the City Comnuission to designate a qualified independent Certified Public Accountant to review, examine and report on all fiscal matters; and WHEREAS, the City of South Miami currently has agreement with the firm of Sharpton, Brunson & Company, P.A. to provide independent audit services; and WHEREAS, the City Manager wishes to renew the agreement for two additional years NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND CITY COMMISSION OF THE CITY OF SOUTH MIAMI, FLORIDA: Section 1. That the City Manager be, and hereby is, authorized to execute the attached contract which is made a part of this resolution, with Sharpton, Brunson & Company, P.A. for independent auditing services for the fiscal years ending September 30, 1996 and 1997. Section 2. Pursuant to the aforementioned contract, the fee for the fiscal years stated in Section I above will be $26,750.00 and $27,500.00 respectively, plus out of pocket cost not exceeding $600.00 each year. APPROVED: MAYOR ATTEST: COMMISSION VOTE: 5-0 Mayor Cunningham: Yea Vice Mayor Robaina: Yea Ile CITY CLERK TJ / Commissioner Price: Yea Commissioner Bethel: Yea READ AND APPROVED AS TO FORM: Commissioner Price: Yea CITY ATTORNEY R t O TO: Mayo e' CITY OF SOUTH MIAMI 6130 Sunset Drive, South Miami, FL 33143 r and Commission DATE: April 11, 1996 1111 1111 11 ���Em000 & 00004011 wm� aw /W;F� FROM: ddie Cox, City Manager RE: Agenda Item # Commission Meeting April 16, 1996 _ Auditor Services The attached resolution relates to the hiring of independent outside auditors to review our financial operations as promulgated in Article IV, Section 3E of the Charter of City of South Miami. I am recommending that we extend the contract for our current auditors Sharpton, Brunson and Co. for an additional two years. I base my recommendation on the fact that they have performed satisfactorily for the City in the last two years, they have highly qualified staff, and their fees are competitive with 4 the market rates. I recommend your approval. f Sharpton, Brunson &Company, CERTIFIED PUBLIC ACCOUNTANTS William F. Hampton, City Manager CITY OF SOUTH MIAMI 6130 Sunset Drive South Miami, Florida Dear Mr. Hampton: 33143 e I' ONE SOUTHEAST THIRD AVENI.*E, SUITE 22100 / rvU. 1I, FLORIDA 33131 TELEPHONE* (305) 374-165714 / FACSLN11LE: (305) 3'12 8161 September 27, 1994 This letter sets forth our understanding of the terms and objectives of our engagement, the nature and scope of the services we will provide, and the related fee arrangements. We will audit the City of South Miami's (City) financial statements as of and for the year ended September 30, 1994, in accordance with generally accepted auditing standards, and the standards for financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States and OMB Circular A428, "Single Audits of State and Local Governments as well as AICPA standards and. procedures and requirements of federal and state agreements and statutory requirements to the extent required by applicable auditing standards. The audit services provided shall comprise the preparation of the Comprehensive Annual Financial Report for the City. As a part of our audit, we will consider the City's internal control structure and assess control risk, as required by generally accepted auditing standards, for the purpose of establishing a basis for determining the nature, timing and extent of auditing procedures necessary for expressing our opinion concerning the financial statements and not to provide assurance on the internal control structure. We will prepare a separate written report on our understanding of the City's internal control structure and the assessment of control risk made as part of the financial statement audit. Our report will include: (1) the scope of our work in obtaining an understanding of the internal control structure and in assessing the control risk, (2) the City's significant internal controls or control structure including the controls established to ensure compliance with laws and regulations that have a material impact on the financial statements, and (3) the reportable conditions, including the identification of material weaknesses, identified as a result of our work in understanding and assessing control risk. Sharpton, Brunson & Company, P.A. lb Page Two Compliance with laws, regulations, contracts, and grants applicable to the City is the responsibility of the City's management. As part of obtaining reasonable assurance about whether the financial statements are free of material misstatements, we will perform tests of City's compliance with certain provisions of laws, regulations, contracts, and grants. However, our objective is not to provide an opinion on overall compliance with such provisions. We will prepare a separate written report on our test of compliance with applicable laws and regulations. This report will contain a statement of positive assurance on those items which were tested for compliance, negative assurance on those items not tested, and a description of all material instances of noncompliance. At the conclusion of the engagement, the City's management will provide to us a representative letter that, among other things, will confirm management's responsibility for the preparation of the financial statements in conformity with generally accepted accounting principles, the availability of financial records and related data, the completeness and availability of all minutes of board of directors and committee meetings, and the absence of irregularities involving management or those employees who have significant roles in the control structure. We understand that our reports on the internal control structure as part of the financial audit and on compliance with laws and regulations are intended for the information of the audit committee, management, and others within City of South Miami. This restricts to limit the distribution of this report, which is a matter of public record. on is not intended A timetable to complete the engagement should be discussed and agreed upon as soon as possible. We will require between three to four weeks to complete field work. A draft of our report will be rendered within ten business days following completion of field work. Final reports Is shall be issued no later than ten business days following our review of the preliminary draft of the financial statements unless unexpected factors are encountered. This estimate may not be achievable if problems are encountered with regard to the condition of the accounting records or their completeness. If such problems are discovered, we will discuss the matter with you immediately in order that we can reach an agreement as to the resolution of the situation. Sharpton, Brunson c� Coanpany, P.?),.. Page Three Our fee for the above services will be $26,000, plus out -of- pocket costs not to exceed $600. The City of South Miami will be billed monthly as the work progresses with payment due upon presentation. This Agreement shah commence as of the date first written above, for the purpose of auditing the financial statements of the City for the fiscal year October 1, 1994 through September 30, 1995 with the City reserving the right to extend this Agreement on an annual basis for four (4) additional fiscal years subject to mutual agreement by the Auditor and the City. May we remind you that the responsibility for the preparation of financial statements including adequate disclosure -is that of the management of the company. This includes the maintenance of adequate accounting records and internal controls, the selection and application of accounting policies, and the safeguard of the assets of the company. As part of our audit process, we will request from management written confirmation concerning representation made to us in connection with the audit. We look forward to full available to us whatever records with our audit. cooperation from your staff and we trust that they will make documentation and other. information requested in connection Please sign and return the enclosed copy of this letter to indicate that it is in accordance with your understanding of the arrangements for our audit of the financial statements. Accepted. By Title: Date. uw '"MIMLAOEswosa Yours very truly, SHARkTON, BB 0. ny SON & COMPANY, P.A. on, CPA I A. C. D. SHARPTON, BRUNSON &COMPANY P.A. [Or Mwofftirqrtrra From time to time, we get inquiries concerning our method of charging fees. This is understandable since each CPA firm handles fees a little differently and some new clients may not have used a CPA before. This letter is our tool for communicating our fee structure to our clients and other interested parties. All time spent by partners of Sharpton, Brunson &Company or their staff members on your matters including, but not limited to (a) accounting; (b) review work; (c) conferences; (d) report preparation; (e) research; (f) telephone calls; (g) settlement negotiations; (h) consulting; or (i) tax preparation and research will be billed at the applicable hourly rates. Each staff member maintains accurate time records, and clients are billed based on actual time spent on their behalf. Since we sell no products and accept no contingent fees, our time and expertise is our only source of income. A standard hourly rate is set for each staff member based on the criteria of experience and ability. If no extenuating circumstances exist, clients are billed using standard hourly rates multiplied by the actual hours worked. Hourly rates vary substantially among staff members -- currently from a low of $55 to a high of $165 per hour. Accordingly, it makes sense to use less experienced staff members to perform routine accounting procedures to achieve the lowest hourly rate. Basic overhead costs are included in the hourly rates. a client is charged to them. Travel, postage, copies, 1 etc. are included in this category, Expenses specifically on behalf of ong distance calls, courier services, 11 E. F. G. By. • illings Billings will be made monthly, but less frequent for limited activity, and are payable in full upon request. If the account has not been paid within 30 days from the date of invoice, a finance /interest charge of 10% per annum on the unpaid balance could be charged. It is understood that Sharpton, Brunson & Company has the right to defer rendering further services until payment is received on past -due billings. If action is instituted to collect accountant's fees and cost pursuant to this Agreement, the undersigned client agrees to pay such sum as the court may fix as attorney's fees and costs. Retainer A retainer in the sum of $5,000 is to be paid before work proceeds. Initial services rendered are to be first applied to the retainer fee. Termination It is is between the parties that this Agreement could be terminated for good cause by either party upon thirty days of written notice. N, BRUNWN & COMPANY, P.A. . Anthony Brunson Dated. The undersigned acknowledges reading and understanding the foregoing Fee Explanation and Agreement, agrees to the terms thereof, and acknowledges receiving a copy thereof. CITY OF SOUTH MIAMI By Mr. William F. Hampton Dated. c j Aj 1 � y CERTIFIED PUBLIC ACCOUNTANTS ONE SOU'I'HEAS'I "THIRD AVENUE, SLiI`I'E 2100; MIAMI, FLORIDA 33131 TELEPHONE: (305) 374 -1574 If FACSIMILE: (305) 372 -8161 AA FAX: 663=6346 April 1, 1996 Eddie Cox, City Manager CITY OF SOUTH MIAMI 6130 Sunset Drive South Miami, FL 33143 Dear Mr. Cox: This memorandum respectfully requests that the City of South Miami ( "City ") exercise the option provision of the audit engagement letter dated September 27, 19940 The agreement provides for a two (2) year extension conditioned upon satisfactorily performance and mutual agreement by Sharpton, Brunson and Company, P.A. and the City. Moreover, our proposed fee schedule the City during fiscal year ended September 30, 1993. will remain comparable to audit costs paid by Please consider the proposed fee schedule that provides for a 3% increase on an annual basis. The fee adjustment is requested to offset cost -of- living factors and inflationary price increases. The proposed fee schedule is as follows: on Year Ending 1996 1997 Your timely consideration of this matter will be greatly appreciated. Sincerely, SHAAPTON, At�thory AB:th NSON & CO., P.A. c: Hakeem K. Oshikoya, CPA $26,750 $27,500 V