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HomeMy WebLinkAboutAgenda - 04-21-2009 - 4jORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: April 21, 2009 Action Agenda Item No. ~- - ~ SUBJECT: Contract for Preparation of the Schedule of State and Federal Financial Assistance DEPARTMENT: Finance PUBLIC HEARING: (Y/N) No •ATTACHMENT(S): INFORMATION CONTACT: Engagement Letter/Contract with Cherry Bekaert and Holland Gary Humphreys, 245-2453 PURPOSE: To award the contract for preparation of the Schedule of State and Federal Financial Assistance for the fiscal year ending June 30, 2009. BACKGROUND: For the last two fiscal years the County has contracted with the accounting firm of Cherry Bekaert & Holland to prepare the Schedule of State and Federal Financial Assistance. Prior to that time this work was included with the audit contract. However, the County's auditing firm, McGladrey & Pullen does not prepare this statement, because it would present a conflict in performing the audit. Cherry Bekaert has proposed a fee of $7,750, which is the same as last year. FINANCIAL IMPACT: The cost of the contract with Cherry Bekeart and Holland to prepare the FY 2008-09 Statement of State and Federal Financial Assistance is $7,750. RECOMMENDATION(S): The Manager recommends the Board approve the contract with Cherry Bekeart & Holland for preparation of Schedule of State and Federal Financial Assistance and authorize the Manager to sign the contract. a Cherry, Bekaert & Holland, L.L.P. The Firm of Choice. March 13, 2009 Mr. Gary Humphreys, Financial Services Director Orange County, North Carolina 208 South Cameron Street Hillsborough, North Carolina 27278 Dear Mr. Humphrey: www.cbh.com 2626 Glenvrood Avenue -Suite 300 Raleigh, North Carolina 27608 phone 919.782.1040 fax 919.783.0976 This letter of arrangement between Orange County, North Carolina (the "County') and Cheny, Bekaert & Holland, L.L.P. sets forth the nature and scope of the services we will provide, the Countys required involvement and assistance in support of our services, the related fee arrangements and other terms and conditions designed to assure that our professional services are performed to achieve the mutually agreed upon objectives of the County. SUMMARY OF SERVICES We will prepare the Schedule of Expenditures of Federal and State Awards (the "schedule") ofthe Countyas of and for the year ended June 30, 2009. However, management is responsible for the schedule. In your representations to us, you will be asked to acknowledge our role in this regard, and your review, approval, and responsibility for the schedule. Further,. you are responsible for designating a qualified management- level individual to be responsible and accountable for overseeing these services. Any additional services that you may request, and that we agree to provide, will be subject of separate written arrangements. Eddie Burke, who will be responsible for assuring the overall quality, value, and timeliness of our services to you, will lead the engagement. TERMS AND CONDITIONS SUPPORTING FEE As a result of our planning process, the County and Cheny, Bekaert & Holland, L.L.P. have agreed to a fee, subject to the following conditions. To facilitate meeting our mutual objectives, the County will provide in a timely manner audit schedules and supporting information, including timely communication of all significant accounting and financial reporting matters, as well as clerical assistance as mutually agreed upon and as is normal and reasonable in the circumstances. When and if for any reason the County is unable to provide such schedules, information and assistance, Cherry, Bekaert & Holland, L.L.P. and the County will mutually revise the fee to reflect additional services, if any, required of us to achieve these objectives. In providing our services, we will consult with the County with respect to matters of accounting, financial reporting, or other significant business issues. Accordingly, time .necessary to affect a reasonable amount of such consultation is reflected in our fee. However, should a matter require research, consultation, or work beyond that amount, Cherry, Bekaert & Holland, L.L.P. and the Countywill agree to an appropriate revision in services and fee. .~ .. ~.,.... , ~.A..,.~ BAKER TILLY INTE0.NATtONAL J Orange County, North Carolina Page 2 Except for any changes in fees, which may result from the circumstances described above, our fees will be limited to those set forth below. FEE Our fees for these services will be based upon our customary billing practices at the time of the engagement. Bills for services will be rendered as work progresses and are due within 15 days from invoice date. A service charge will be added to past due accounts equal to 1 1/2% per month (18% annual rate) on the previous month's balance less payments received during the month, with a minimum charge of $2.00 per month. The fee for our services as described in this letter will not exceed $7,750. This fee is based on anticipated cooperation from your personnel and the assumption that unexpected circumstances will not be encountered during the audit. If significant additional time is necessary, we will discuss it with you and arrive at a new fee estimate before we incur the additional costs. Any modification to the fee shall be in writing and signed by both parties. You agree to pay all costs of collection (including reasonable attorneys' fees) thatwe may incur in connection with the collection of unpaid invoices. ACCESS TO WORKING PAPERS The working papers forthe engagement are the property of Cherry, Bekaert & Holland, L.L.P. and constitute confidential information. Except as discussed below, any requests for access to ourworking papers will be discussed with you prior to making them available to requesting parties. The workpapers for this engagement will be retained for a minimum of three years after the date of completion of the schedule or for any additional period requested by the County. If we are aware that a federal or State awarding agency, pass-through entity, or auditee is contesting the schedule, we will contact the agency contesting the schedule for guidance prior to destroying the workpapers. Our Firm, as well as all other major accounting firms, participates in a "peer review" program, covering our audit and accounting. practices. This program requires that once every three years we subject our quality assurance practices to an examination 6y another accounting firm. As part of the process, the other firm will review a sample of our work. It is possible that the work we perform for you maybe selected by the other firm for their review. If it is, they are bound by professional standards to keep all information confidential. If you object to having the work we do for you reviewed by our peer reviewer, please notify us in writing. USE OF THIRD PARTY SERVICE PROVIDERS The firm may from time to time, and depending on the circumstances, use third-party service providers in serving your account. We may share confidential information about you with these service providers, but remain committed to maintaining the confidentiality and security of our information. Accordingly, we maintain internal policies, procedures and safeguards to protect the confidentiality of your personal information. In addition, we will secure confidentiality agreements with all service providers to maintain the confidentiality of your information. and we will take reasonable precautions to determine that they have appropriate procedures in place to prevent the unauthorized release of your confidential information to others. In the event that we are unable to secure an appropriate confidentiality agreement, you will be asked to provide your consent prior to the sharing of your confidential information with the third-part service provider. Furthermore, the firm will remain responsible for the work provided by any such third-party service providers. Orange County, North Carolina Page 3 SUBPOENAS In the event we are requested or authorized by you or required by government regulation, subpoena, or other legal process to produce our working papers or our personnel as witnesses with respect to our engagement for you; you will, so long as we are not a party to the proceeding in which the information is sought, reimburse us for our professional time and expense, as well as the fees and expenses of our counsel, incurred in responding to such a request. OTHER MATTERS If any dispute, controversy or claim arises in connection with the performance or breach of this agreement, either party may, on written notice to the other party, request that the matter be mediated. Such mediation would be conducted by a mediator appointed by and pursuant to the rules of the American Arbitration Association (AAA) or such other neutral facilitator acceptable to both parties. Both parties would exert their best efforts to discuss with each other in good faith their respective positions in an attempt to finally resolve such dispute, controversy; or claim. Client and accountant both agree that any dispute over fees charged by the accountant to the client will be submitted for resolution by arbitration in accordance with the Rules for Professional Accounting and Related Services Disputes of the AAA. Any award rendered by the Arbitrator pursuant to this Agreement may be filled and entered and shall be enforceable in the Superior Court of the County in which the arbitration proceeds. In agreeing to arbitration, we both acknowledge that, in event of a dispute over fees charge by the accountant, each of us is giving up the right to have the dispute decided in a court of law before a judge or jury and instead we are accepting the use of arbitration for resolution. The prevailing party shall be entitled to an award of reasonable attorneys' fees and costs incurred in connection with the arbitration of the dispute in an amount to be determined by the arbitrator. If the foregoing is in accordance with your understanding, please sign a copy of this letter in the space provided and return it to us. If you have any questions, please call Eddie Burke at (919) 782-1040. Very truly yours, CHERRY, BEKAERT & HOLLAND, L.L.P. Raleigh, North Carolina Enclosure .RESPONSE: This letter correctly sets forth the understanding of Orange County, North Carolina. By: Laura Blackmon, County Manager