HomeMy WebLinkAboutC-1664 - Audit agreement 1975-760
TO: FINANCE DIRECTOR
FROM: City Clerk
SUBJECT: Contract No. 1684
CITY OF NEWPORT BEACH
Description of Contract
CALIFORNIA
City Hall
3300 W. Newport Bivd
Area Code 714
673 -2110
DATE 22, 1975
Authorized by Resolution No. , adopted on
Effective date of Contract — Amat 20. 1975
Contract with fblrnr[m 6 So=, CPAL'e
Address 610 Ng"rt Cenbar 0ri-w
Neaoort Head. CA 92660
Pmount of Contract $7,000 for aWit
work
city Clerk
i
August 22, 1975
Holmgran & Sawyer, CPA's
610 Newport Center Drive
Newport Broach, CA 92660
Subject: Auditing Services hgrse ant
City of Newport Beach
C -1664
M=losed is a fully executed copy of subject agreownt
between your fiaa and the City for the fiscal year
1975 -76.
This agreement was authorized by the City Council on
August 11 by the adoptim of Resolution No. 8570.
!aura Iagi.os, CND
City Clerk
I,L: swk
enc.
E
0
AGREEMENT FOR INDEPENDENT AUDIT
This Agreement is made and entered into this z` L7N
_�Lday
of A <<., 7 , 1975, by and between the CITY OF NEWPORT BEACH,
a municipal corporation, hereinafter referred to as "City ", and
HOLMGREN AND SAWYER, Certified Public Accountants, hereinafter
referred to as "Auditor ".
IN CONSIDERATION of the premises and the agreements,
covenants and conditions hereinafter contained and to be kept and
performed by the respective parties hereto, it is agreed as follows:
1. Auditor hereby agrees, at such time or times as he
shall determine, to make an audit and examination of the books,
records, inventories and reports of all officers and employees of
the City who receive, handle or disburse public funds for the
fiscal year 1975 -76, beginning July 1, 1975, and ending June 30,
1976, in accordance with Section 1117 of the City Charter, in
order to express an opinion upon the financial statements of the
City. The audit shall embrace all funds of the City, including
the 1911 Act Improvement Bond Funds. The audit shall be conducted
in accordance with generally accepted auditing standards and shall
include such tests of the accounting records and such other
auditing procedures applicable in the circumstances as to enable
Auditor to express an opinion upon the financial statements of
the City. If circumstances are encountered which, in the judgment
of Auditor, prevent the expression of an unqualified opinion upon
the financial statements taken as a whole, such opinion shall
be qualified or omitted, but Auditor's report shall contain a
statement of the reasons for the qualification or omission. To
the extent applicable, the audit shall include the audit procedures
recommended in the booklet entitled "Check List for the Audit of
the Financial Records of a California City ", which was published
in March, 1956, by the League of California Cities, and the
California Society of Certified Public Accountants.
r]
0
2. Auditor agrees to render a report on his audit
of the City for the fiscal year to which this contract applies,
accompanied by condensed financial statements, and also to present
a short form report to accompany the complete financial statements
submitted by the Finance Director. These reports will include an
unqualified or qualified opinion or a disclaimer of opinion on the
financial statements, according to the circumstances encountered,
as described in Paragraph 1. Said report shall be submitted to the
City Council with a copy for each member and one for the City
Manager, Finance Director, and City Attorney, and three additional
copies to be placed on file in the office of the City Clerk for
public inspection. In addition to the final report, Auditor shall
advise the Council not later than November 15 and a second time
not later than May 13 of the fiscal year as to the conditions found
to exist. These interim reports shall consist of a short discussion
of the performance of the accounting procedures and any other
matters Auditor believes should be called to the attention of the
Council. Auditor agrees to render a Management Letter at the close
of the fiscal year, setting forth the problems and recommended
solutions to those problems as they relate to the internal controls
of the City's accounting system, as well as any other matters
which in the Auditor's opinion should be brought to the attention
of the City.
3. Compensation shall be paid to Auditor for this audit
engagement in the total amount of $7,000.00, payable 25% on
January 1, 1976, 25% on May 1, 1976, and 50% upon delivery of
Auditor's report following the close of the fiscal year.
4. The audit and examination specified herein and the
fee stipulated contemplate that conditions satisfactory to the
normal progress and completion of said audit and examination will
be encountered. In the event that actual conditions met are not
compatible with the usual and expected progress of the work and
if in order to discharge its contractual obligation hereunder, in
-2-
0 0
the opinion of Auditor it would be necessary to do additional.
work or to expend unreasonable amounts of time not contemplated
by this contract because of (a) incompleteness of records, (b)
abnormal errors, (c) misappropriation of funds, (d) lack of
cooperation from City employees or (e) any other justifiable
reasons, Auditor, upon reasonable demonstration of the existence
of such conditions, shall be entitled to apply to the City Council
for supplemental compensation at the rates specified in
Paragraph 6 hereof.
5. The audit and examination specified in Paragraph 1
hereof is to be based upon tests and samples of the accounting
records and transactions sufficient to satisfy Auditor of the
fairness of presentation of the financial condition and operating
results of the City, and is not to comprise a detailed examination
of all transactions. It is understood that, owing to the test
character of the examination, reliance must be placed on the
adequacy of the systems of internal check and control as the
principal safeguard against defalcation and other irregularities
of the same general nature, and, although Auditor will attempt to
detect any defalcations or similar irregularities, Auditor does not
assume the responsibility for doing so.
6. It is contemplated that Auditor may be requested
to perform services additional to the usual audit work, such as
advising upon changes in the accounting methods or the personnel,
assisting in accomplishing changes in the recording or reporting,
investigating the compliance of lessees with the terms of City
leases, making special examinations or audits at the request of
the City Council at times he would not otherwise be conducting
the audit or of officers, employees or departments who do not
receive, handle or disburse public funds and other similar services.
In such circumstances, the City Council or City Manager may
authorize Auditor to perform such work or render services in
addition to those which are usual and customary in making an audit
-3-
0 0
and examination of the accounts and records of the City, and
Auditor shall receive payment at the following rates per hour for
respective grades of staff members and partners used in performing
such work or services:
Partners
Senior Accountants
Staff Assistants
Juniors
$40.00 -
$60.00
per
hour
$22.00 -
$25.00
per
hour
$17.00 -
$20.00
per
hour
$12.00 -
$15.00
per
hour
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the date first above written.
CITY OF NEWPORT BEACH
By f.&&
Mayor
... �..
ATTEST:
City Clerk
LA AND SAWYER,
Ce ified Public Accountants
APPROVED AS TO FORM;
Aeh4y
City Attorney
By
LFA
-4-
DDO:yz
8/13/75
RESOLUTION NO. 8 5 7 0•
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
8y : e C T't C i;;;C:1 OF NEWPORT BEACH AUTHORIZING THE EXECUTION OF
GiTf OF W.WWPORT 'QaACF� AN AUDITING SERVICES AGREEMENT BETWEEN THE
CITY OF NEWPORT BEACH AND HOLMGREN AND SAWYER,
CERTIFIED PUBLIC ACCOUNTANTS, FOR FISCAL YEAR
1975 -76
WHEREAS, there has been presented to the City Council
of the City of Newport Beach a certain agreement between the
City of Newport Beach and Holmgren and Sawyer, Certified
Public Accountants, for auditing services for the Fiscal Year
1975 -76; and
WHEREAS, the City Council has considered the terms
and conditions of said auditing services agreement and found
them to be fair and equitable, and in the best interests of the
City;
NOW, THEREFORE, BE IT RESOLVED by the City Council
of the City of Newport Beach that said auditing services agreement
above described is approved, and the Mayor and City Clerk are
hereby authorized and directed to execute the same on behalf
of the City of Newport Beach.
ADOPTED this 11th day of August , 1975.
Mayor
ATTEST:
City Cl
DDO /bc
8/5/75