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HomeMy WebLinkAboutC-2085 - Auditing services for City fiscal years 1978-79 & 79-800 0 CITY OF NEWPORT BEACH CALIFORNIA City Han 3300 W. Newport Blvd. Area Code 114 DATE April 17, 1979 TO: FINANCE DIRECTOR FROM: City Clerk SUBJECT: Contract No. l Description of Contract Auditing Services /fy 1978 -79 and 1979 -80 Authorized by Resolution No. 9538 , adopted on April 9, 1979 Effective date of Contract April 13, 1979 Contract with Hurdman & Cranstoun, CPA's Address 610 Newport Center Dr. Newport Beach, Ca 92660 Amount of Contract -S` ,-t17T : %, City clerk IQ a 0 AGREEMENT FOR INDEPENDENT AUDIT This Agreement is made and entered into this day of 1979, by and between the CITY OF NEWPORT BEACH, a municipal corporation, hereinafter referred to as "City," and HURDMAN AND CRANSTOUN, Certified Public Accountants, hereinafter referred to as "Auditor." NOW, THEREFORE, in consideration of the promises 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 1978 -79, beginning July 1, 1978, and ending June 30, 1979, and for the Fiscal Year 1979 -80, beginning July 1, 1979, and ending June 30, 1980, in accordance with Section 1117 of the City Charter, in order to express an opinion upon the financial state- ments 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 on the financial statements of the City. If circumstances are encountered which, in the judgment of Auditor, prevent the expression of an unqualified opinion on 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 0 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. 2. Auditor agrees to render a report on his audit of the City for the Fiscal Years 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 circum- stances 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 County 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. -2- Ll 3. Compensation shall be paid to Auditor for the audit engagement for the Fiscal Year 1978 -79 in the amount of Eight Thousand Five Hundred Dollars ($8,500.00), payable twenty -five percent (25 %) on January 1, 1979, twenty -five percent (25 %) on May 1, 1979, and fifty percent (50%) upon delivery of Auditor's report following the close of the Fiscal Year 1978 -79. 4. Compensation shall be paid to Auditor for the audit engagement for the Fiscal Year 1979 -80 in the amount of Nine Thousand Dollars ($9,000.00), payable twenty -five percent (25%) on January 1, 1980, twenty -five percent (25g) on May 1, 1980, and fifty percent (50 %) upon delivery of Auditor's report following the close of the Fiscal Year 1979 -80. 5. The audit and examination specified herein and the fees 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 here- under, in 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 the (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 7 hereof. 6. The audit and examination specified in Paragraph 1 hereof are to be based upon tests and samples of the accounting records and transactions sufficient to satisfy Auditor of the -3- 0 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 of character of the examination, reliance must be placed on the adequacy of the systems of inter- nal check and control as the principal safeguard against defal- cation 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. 7. 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 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: Staff Assistants Senior Accountants Supervisory Accountants Managers Partners -4- $20.00 - $25.00 per hour $30.00 - $36.00 per hour $38.00 - $40.00 per hour $50.00 per hour $70.00 per hour • 0 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. ATTEST: City Clerk APPROVED AS TO FORM: City Attorney CITY OF NEWPORT BEACH, A Municipal Corporation By Mayo �— HURDMAN AND CRANSTOUN, Certified Public Accountants By 5A -5- 4/5/79 kb RESOLUTION NO. 9538 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE AN AGREEMENT BETWEEN THE CITY OF NEWPORT BEACH AND HURDMAN AND CRANSTOUN, CERTIFIED PUBLIC ACCOUNTANTS, IN CONNECTION WITH AUDITING SERVICES FOR THE FISCAL YEARS 1978 -79 AND 1979 -80 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 Hurdman and Cranstoun, Certified Public Accountants, in connection with auditing services for the Fiscal Years 1978 -79 and 1979 -80; and WHEREAS, the City Council has reviewed the terms and conditions of said agreement and found them to be fair and equitable, NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Newport Beach that said 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 9th day of April , 1979. Mayor ATTEST: City Clerk 4/5/79 kb