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HomeMy WebLinkAbout2019-403-E Finance - Mauldin and Jenkins contract amendment DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 LGC-205 CONTRACT TO AUDIT ACCOUNTS Rev. 10/2018 The Governing Board Board of Commissioners Of Primary Government Unit Orange County and Discretely Presented Component Unit(DPCU) (if applicable) Primary Government Unit, together with DPCU(if applicable), hereinafter referred to as Governmental Unit(s) and Auditor Name Mauldin & Jenkins, PLLC Auditor Address 200 Galleria Parkway, Suite 1700 Atlanta, Georgia 30339 Hereinafter referred to as Auditor for Fiscal Year Ending Audit Report Due Date 06/30/19 10/31/19 Must be within four months of FYE hereby agree as follows: 1. The Auditor shall audit all statements and disclosures required by U.S. generally accepted auditing standards (GAAS) and additional required legal statements and disclosures of all funds and/or divisions of the Governmental Unit(s). The non-major combining, and individual fund statements and schedules shall be subjected to the auditing procedures applied in the audit of the basic financial statements and an opinion shall be rendered in relation to (as applicable) the governmental activities, the business- type activities, the aggregate DPCUs, each major governmental and enterprise fund, and the aggregate remaining fund information (non-major government and enterprise funds, the internal service fund type, and the fiduciary fund types). 2. At a minimum, the Auditor shall conduct his/her audit and render his/her report in accordance with GAAS. The Auditor shall perform the audit in accordance with Government Auditing Standards if required by the State Single Audit Implementation Act, as codified in G.S. 159-34. If required by OMB Uniform Administration Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and the State Single Audit Implementation Act, the Auditor shall perform a Single Audit. This audit and all associated audit documentation may be subject to review by Federal and State agencies in accordance with Federal and State laws, including the staffs of the Office of State Auditor (OSA) and the Local Government Commission (LGC). If the audit requires a federal single audit performed under the requirements found in Subpart F of the Uniform Guidance (§200.501), it is recommended that the Auditor and Governmental Unit(s) jointly agree, in advance of the execution of this contract, which party is responsible for submission of the audit and the accompanying data collection form to the Federal Audit Clearinghouse as required under the Uniform Guidance (§200.512). If the audit and Auditor communication are found in this review to be substandard, the results of the review may be forwarded to the North Carolina State Board of CPA Examiners (NC State Board). County and Multi-County Health Departments: The Office of State Auditor will require Auditors of these Governmental Units to perform agreed upon procedures (AUPs) on eligibility determination on certain programs. Both Auditor and Governmental Unit agree that Auditor shall complete and report on these AUPs on Page 1 of 8 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 LGC-205 CONTRACT TO AUDIT ACCOUNTS Rev. 10/2018 eligibility determination as required by OSA and in accordance with the instructions and timeline provided by OSA. 3. If an entity is determined to be a component of another government as defined by the group audit standards, the entity's auditor shall make a good faith effort to comply in a timely manner with the requests of the group auditor in accordance with AU-6 §600.41 - §600.42. 4. This contract contemplates an unmodified opinion being rendered. If during the process of conducting the audit, the Auditor determines that it will not be possible to render an unmodified opinion on the financial statements of the unit, the Auditor shall contact the LGC staff to discuss the circumstances leading to that conclusion as soon as is practical and before the final report is issued. The audit shall include such tests of the accounting records and such other auditing procedures as are considered by the Auditor to be necessary in the circumstances. Any limitations or restrictions in scope which would lead to a qualification should be fully explained in an attachment to this contract. 5. If this audit engagement is subject to the standards for audit as defined in Government Auditing Standards, 2011 revisions, issued by the Comptroller General of the United States, then by accepting this engagement, the Auditor warrants that he/she has met the requirements for a peer review and continuing education as specified in Government Auditing Standards. The Auditor agrees to provide a copy of the most recent peer review report to the Governmental Unit(s) and the Secretary of the LGC prior to the execution of an audit contract. Subsequent submissions of the report are required only upon report expiration or upon auditor's receipt of an updated peer review report. If the audit firm received a peer review rating other than pass, the Auditor shall not contract with the Governmental Unit(s) without first contacting the Secretary of the LGC for a peer review analysis that may result in additional contractual requirements. If the audit engagement is not subject to Government Accounting Standards or if financial statements are not prepared in accordance with U.S. generally accepted accounting principles (GAAP) and fail to include all disclosures required by GAAP, the Auditor shall provide an explanation as to why in an attachment to this contract or in an amendment. 6. It is agreed that time is of the essence in this contract. All audits are to be performed and the report of audit submitted to LGC staff within four months of fiscal year end. If it becomes necessary to amend this due date or the audit fee, an amended contract along with a written explanation of the delay shall be submitted to the Secretary of the LGC for approval. 7. It is agreed that GAAS include a review of the Governmental Unit's (Units') systems of internal control and accounting as same relate to accountability of funds and adherence to budget and law requirements applicable thereto; that the Auditor shall make a written report, which may or may not be a part of the written report of audit, to the Governing Board setting forth his/her findings, together with his recommendations for improvement. That written report shall include all matters defined as "significant deficiencies and material weaknesses" in AU-C 265 of the AICPA Professional Standards (Clarified). The Auditor shall file a copy of that report with the Secretary of the LGC. 8. All local government and public authority contracts for audit or audit-related work require the approval of the Secretary of the LGC. This includes annual or special audits, agreed upon procedures related to internal controls, bookkeeping or other assistance necessary to prepare the Governmental Unit's (Units') records for audit, financial statement preparation, any finance-related investigations, or any other audit- related work in the State of North Carolina. Invoices for services rendered under these contracts shall not be paid by the Governmental Unit(s) until the invoice has been approved by the Secretary of the LGC. (This also includes any progress billings.) [G.S. 159-34 and 115C-447] All invoices for Audit work shall be submitted in PDF format to the Secretary of the LGC for approval. The invoice marked `approved 'with approval date shall be returned to Page 2 of 8 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 LGC-205 CONTRACT TO AUDIT ACCOUNTS Rev. 10/2018 the Auditor to present to the Governmental Unit(s) for payment. Approval is not required on contracts and invoices for system improvements and similar services of a non-auditing nature. 9. In consideration of the satisfactory performance of the provisions of this contract, the Governmental Unit(s) shall pay to the Auditor, upon approval by the Secretary of the LGC, the fee, which includes any costs the Auditor may incur from work paper or peer reviews or any other quality assurance program required by third parties (federal and state grantor and oversight agencies or other organizations) as required under the Federal and State Single Audit Acts. This does not include fees for any pre-issuance reviews that may be required by the NC Association of CPAs (NCACPA) Peer Review Committee or NC State Board of CPA Examiners (see Item 12). 10. If the Governmental Unit(s) has/have outstanding revenue bonds, the Auditor shall submit to LGC staff, either in the notes to the audited financial statements or as a separate report, a calculation demonstrating compliance with the revenue bond rate covenant. Additionally, the Auditor shall submit to LGC staff simultaneously with the Governmental Unit's (Units') audited financial statements any other bond compliance statements or additional reports required by the authorizing bond documents, unless otherwise specified in the bond documents. 11. After completing the audit, the Auditor shall submit to the Governing Board a written report of audit. This report shall include, but not be limited to, the following information: (a) Management's Discussion and Analysis, (b) the financial statements and notes of the Governmental Unit(s) and all of its component units prepared in accordance with GAAP, (c) supplementary information requested by the Governmental Unit(s) or required for full disclosure under the law, and (d) the Auditor's opinion on the material presented. The Auditor shall furnish the required number of copies of the report of audit to the Governing Board upon completion. 12. If the audit firm is required by the NC State Board, the NCACPA Peer Review Committee, or the Secretary of the LGC to have a pre-issuance review of its audit work, there shall be a statement in the engagement letter indicating the pre-issuance review requirement. There also shall be a statement that the Governmental Unit(s) shall not be billed for the pre-issuance review. The pre-issuance review shall be performed prior to the completed audit being submitted to LGC Staff. The pre-issuance review report shall accompany the audit report upon submission to LGC Staff. 13. The Auditor shall submit the report of audit in PDF format to LGC Staff when (or prior to) submitting the final invoice for services rendered. The report of audit, as filed with the Secretary of the LGC, becomes a matter of public record for inspection, review and copy in the offices of the LGC by any interested parties. Any subsequent revisions to these reports shall be sent to the Secretary of the LGC along with an Audit Report Reissued Form (available on the Department of State Treasurer website). These audited financial statements, excluding the Auditors' opinion, may be used in the preparation of official statements for debt offerings by municipal bond rating services to fulfill secondary market disclosure requirements of the Securities and Exchange Commission and for other lawful purposes of the Governmental Unit(s) without requiring consent of the Auditor. If the LGC Staff determines that corrections need to be made to the Governmental Unit's (Units') financial statements, those corrections shall be provided within three business days of notification unless another deadline is agreed to by LGC staff. If the OSA designates certain programs to be audited as major programs, as discussed in Item 2, a turnaround document and a representation letter addressed to the OSA shall be submitted to LGC Staff. 14. Should circumstances disclosed by the audit call for a more detailed investigation by the Auditor than necessary under ordinary circumstances, the Auditor shall inform the Governing Board in writing of the need for such additional investigation and the additional compensation required therefore. Upon approval by the Page 3 of 8 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 LGC-205 CONTRACT TO AUDIT ACCOUNTS Rev. 10/2018 Secretary of the LGC, this contract may be modified or amended to include the increased time, compensation, or both as may be agreed upon by the Governing Board and the Auditor. 15. If an approved contract needs to be modified or amended for any reason, the change shall be made in writing, on the Amended LGC-205 contract form and pre-audited if the change includes a change in audit fee (pre-audit requirement does not apply to charter schools). This amended contract shall be completed in full, including a written explanation of the change, signed and dated by all original parties to the contract. It shall then be submitted to the Secretary of the LGC for approval. No change to the audit contract shall be effective unless approved by the Secretary of the LGC, the Governing Board, and the Auditor. 16. A copy of the engagement letter, issued by the Auditor and signed by both the Auditor and the Governmental Unit(s), shall be attached to this contract, and shall be incorporated by reference as if fully set forth herein as part of this contract. In case of conflict between the terms of the engagement letter and the terms of this contract, the terms of this contract shall take precedence. Engagement letter terms that conflict with the contract are deemed to be void unless the conflicting terms of this contract are specifically deleted in Item 26 of this contract. Engagement letters containing indemnification clauses shall not be accepted by LGC Staff. See attached 17. Special provisions should be limited. Please list any special provisions in an attachment. Engagement Letter 18. A separate contract should not be made for each division to be audited or report to be submitted. If a DPCU is subject to the audit requirements detailed in the Local Government Budget and Fiscal Control Act and a separate audit report is issued, a separate audit contract is required. If a separate report is not to be issued and the DPCU is included in the primary government audit, the DPCU shall be named along with the parent government on this audit contract. DPCU Board approval date, signatures from the DPCU Board chairman and finance officer also shall be included on this contract. 19. The contract shall be executed, pre-audited (pre-audit requirement does not apply to charter schools), and physically signed by all parties including Governmental Unit(s) and the Auditor, then submitted in PDF format to the Secretary of the LGC. 20. The contract is not valid until it is approved by the Secretary of the LGC. The staff of the LGC shall notify the Governmental Unit and Auditor of contract approval by email. The audit should not be started before the contract is approved. 21. Retention of Client Records: Auditors are subject to the NC State Board of CPA Examiners' Retention of Client Records Rule 21 NCAC 08N .0305 as it relates to the provision of audit and other attest services, as well as non-attest services. Clients and former clients should be familiar with the requirements of this rule prior to requesting the return of records. 22. This contract may be terminated at any time by mutual consent and agreement of the Governmental Unit(s) and the Auditor, provided that (a) the consent to terminate is in writing and signed by both parties, (b) the parties have agreed on the fee amount which shall be paid to the Auditor (if applicable), and (c) no termination shall be effective until approved in writing by the Secretary of the LGC. 23. The Governmental Unit's (Units') failure or forbearance to enforce, or waiver of, any right or an event of breach or default on one occasion or instance shall not constitute the waiver of such right, breach or default on any subsequent occasion or instance. 24. There are no other agreements between the parties hereto and no other agreements relative hereto that shall be enforceable unless entered into in accordance with the procedure set out herein and approved by the Secretary of the LGC. Page 4 of 8 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 LGC-205 CONTRACT TO AUDIT ACCOUNTS Rev. 10/2018 25. E-Verify. Auditor shall comply with the requirements of NCGS Chapter 64 Article 2. Further, if Auditor utilizes any subcontractor(s), Auditor shall require such subcontractor(s) to comply with the requirements of NCGS Chapter 64, Article 2. 26. All of the above paragraphs are understood and shall apply to this contract, except the following numbered paragraphs shall be deleted (See Item 16 for clarification). Number 25 above, because the Auditor does not have 25 or more employees in the State of North Carolina. 27. The process for submitting contracts, audit reports and invoices is subject to change. Auditors and units should use the submission process and instructions in effect at the time of submission. Refer to the N.C. Department of State Treasurer website at https://www.nctreasurer.com/slg/Pages/Audit-Forms-and- Resources.aspx. 28. All communications regarding audit contract requests for modification or official approvals will be sent to the email addresses provided on the signature pages that follow. Page 5 of 8 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 LGC-205 CONTRACT TO AUDIT ACCOUNTS Rev. 10/2018 FEES FOR AUDIT SERVICES For all non-attest services, the Auditor shall adhere to the independence rules of the AICPA Professional Code of Conduct and Governmental Auditing Standards (as applicable). Bookkeeping and other non- attest services necessary to perform the audit shall be included under this contract. However, bookkeeping assistance shall be limited to the extent that the Auditor is not auditing his or her own work or making management decisions. The Governmental Unit shall designate an individual with the suitable skills, knowledge, and/or experience necessary to oversee the services and accept responsibility for the results of the services. Financial statement preparation assistance shall be deemed a "significant threat" requiring the Auditor to apply safeguards sufficient to reduce the threat to an acceptable level. The Auditor shall maintain written documentation of his or her compliance with these standards in the audit work papers. Fees may not be included in this contract for work performed on Annual Financial Information Reports (AFIRs), Form 990s, or other services not associated with audit fees and costs. Such fees may be included in the engagement letter, but may not be included in this contract or in any invoices requiring approval of the LGC. See Items 8, 9, and 12 for details on other allowable and excluded fees. Prior to submission of the completed audited financial report, applicable compliance reports and amended contract (if required) the Auditor may submit invoices for approval for services rendered, not to exceed 75% of the total of the stated fees below. If the current contracted fee is not fixed in total, invoices for services rendered may be approved for up to 75% of the prior year audit fee. Should the 75% cap provided below conflict with the cap calculated by LGC staff based on the prior year audit fee on file with the LGC, the LGC calculation prevails. 20 NCAC 03 .0505: All invoices for services rendered in an audit engagement as defined in 20 NCAC 3 .0503 shall be submitted to the Commission for approval before any payment is made. Payment before approval is a violation of law. PRIMARY GOVERNMENT FEES Primary Government Unit Orange County Audit $77500 Writing Financial Statements $5000 All Other Non-Attest Services $ 75% Cap for Interim Invoice Approval $61,875.00 DPCU FEES (if applicable) Discretely Presented Component Unit Audit $ Writing Financial Statements $ All Other Non-Attest Services $ 75% Cap for Interim Invoice Approval $ Page 6 of 8 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 LGC-205 CONTRACT TO AUDIT ACCOUNTS Rev. 10/2018 SIGNATURE PAGE AUDIT FIRM Audit Firm Mauldin&Jenkins,PLLC Docu5igned by: Authorized Firm Representative (typed or printed) Signature James Bence 80dB13A7C89E401 . Date Email Address 05/31/19 7/2/2019 jbence@mjcpa.com GOVERNMENTAL UNIT Governmental Unit Orange County Date Primary Government Unit Governing Board Approved Audit Contract (Ref:G.S. 159-34(a)or G.S. 115C-447(a)) DocuSigned by: Mayor/Chairperson (typed or printed) Signature Lr V - Penny Rich chair - County commissioner U F21d4S41C8E747E Date 7/3/2019 Email Address prich@orangecountync.gov Chair of Audit Committee (typed or printed, or"NA") Signature Date Email Address GOVERNMENTAL UNIT— PRE-AUDIT CERTIFICATE (Pre-audit certificate not required for charter schools) Required by G.S. 159-28(a1) or G.S. 115C-441(a1) This instrument has been pre-audited in the manner required by The Local Government Budget and Fiscal Control Act or by the School Budget and Fiscal Control Act. Primary Governmental Unit Finance Officer(typed or printed) Signature Vocu5igned by: V1 � � Gary Donaldson 7NE5181ACC1409. Date of Pre-Audit Certificate 7/2/2019 Email Address gdonaldson@orangecountync.gov Page 7 of 8 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 LGC-205 CONTRACT TO AUDIT ACCOUNTS Rev. 10/2018 SIGNATURE PAGE — DPCU (complete only if applicable) DISCRETELY PRESENTED COMPONENT UNIT DPCU Date DPCU Governing Board Approved Audit Contract (Ref: G.S. 159-34(a) or G.S. 115C-447(a)) DPCU Chairperson (typed or printed) Signature Date Email Address Chair of Audit Committee (typed or printed, or "NA") Signature Date Email Address DPCU — PRE-AUDIT CERTIFICATE (Pre-audit certificate not required for charter schools) Required by G.S. 159-28(al) or G.S. 11 5C-441(al) This instrument has been pre-audited in the manner required by The Local Government Budget and Fiscal Control Act or by the School Budget and Fiscal Control Act. DPCU Finance Officer (typed or printed) Signature Date of Pre-Audit Certificate Email Address Remember to print this form, and obtain all required signatures prior to submission. PRINT Page 8 of 8 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 CE PBMares.. Report on the Firm's System of Quality Control To the Shareholders of Mauldin& Jenkins, LLC and the National Peer Review Committee: We have reviewed the system of quality control for the accounting and auditing practice of Mauldin & Jenkins, LLC (the firm), applicable to engagements not subject to PCAOB permanent inspection, in effect for the year ended May 31, 2017. Our peer review was conducted in accordance with the Standards for Performing and Reporting on Peer Reviews established by the Peer Review Board of the American Institute of Certified Public Accountants (Standards). A summary of the nature, objectives, scope, limitations of, and the procedures performed in a System Review as described in the Standards may be found at www.aicpa.org/prsummary. The summary also includes an explanation of how engagements identified as not performed or reported in conformity with applicable professional standards, if any, are evaluated by a peer reviewer to determine a peer review rating. Firm's Responsibility The firm is responsible for designing a system of quality control and complying with it to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. The firm is also responsible for evaluating actions to promptly remediate engagements deemed as not performed or reported in conformity with professional standards, when appropriate, and for remediating weaknesses in its system of quality control, if any. Peer Reviewer's Responsibility Our responsibility is to express an opinion on the design of the system of quality control and the firm's compliance therewith based on our review. Required Selections and Considerations Engagements selected for review included engagements performed under Government Auditing Standards, including compliance audits under the Single Audit Act; audits of employee benefit plans, an audit performed under FDICIA, and examinations of service organization's SOC I and SOC 2 engagements. As part of our peer review, we considered reviews by regulatory entities as communicated by the firm, if applicable, in determining the nature and extent of our procedures. PBMares,LLP 1 725 Jackson Street,Suite 210 1 Fredericksburg,VA 224011 P 540.371.3566 11.800.296.3710 1 F 540.371.3598 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 -2- Opinion In our opinion, the system of quality control for the accounting and auditing practice of Mauldin & Jenkins, LLC applicable to engagements not subject to PCAOB permanent inspection in effect for the year ended May 31, 2017, has been suitably designed and complied with to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. Firms can receive a rating of pass, pass with deficiency(ies) or fail. Mauldin& Jenkins, LLC has received a peer review rating of pass. P r3 M a4,-e,k, L L P PBMares, LLP October 30, 2017 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 AULDIN & ENKIN S May 31, 2019 The Board of County Commissioners and Bonnie Hammersley, County Manager Orange County,North Carolina 200 South Cameron Street Hillsborough,North Carolina 27278 Attn: Mr. Gary Donaldson, Chief Financial Officer, and Ms. Bonnie Hammersley, County Manager We are pleased to confirm our understanding of the services we are to provide Orange County, North Carolina (the County) for the year ended June 30, 2019. We will audit the financial statements of the governmental activities, the business-type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information, including the related notes to the financial statements, which collectively comprise the basic financial statements, of Orange County, North Carolina as of and for the year then ended. These statements will include the budgetary comparison information for the General Fund. We will obtain and place reliance on the report of other auditors for the Orange County ABC Board, a discretely presented component unit of the County. Accounting standards generally accepted in the United States of America provide for certain required supplementary information (RSI), such as management's discussion and analysis (MD&A), to supplement the County's basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. As part of our engagement, we will apply certain limited procedures to the County's RSI in accordance with auditing standards generally accepted in the United States of America. These limited procedures will consist of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries,the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We will not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. The following RSI is required by U.S. generally accepted accounting principles and will be subjected to certain limited procedures, but will not be audited: I. Management's Discussion and Analysis (MD&A). 2. Local Governmental Employees' Retirement System Schedule of County's Proportionate Share of the Net Pension Liability. 3. Local Governmental Employees' Retirement System Schedule of County Contributions — Pension Plan. 4. Register of Deeds' Supplemental Pension Fund Schedule of County's Proportionate Share of the Net Pension Liability. 200 GALLERIA PARKWAY S.E.,SUITE 1700•ATLANTA,GA 30339-5946.770-955-8600.800-277-0080•FAX 770-980-4489•www.mjcpa.com Members of The American Institute of Certified Public Accountants•RSM International DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 Orange County - 2019 Engagement Letter May 31, 2019 Page 2 5. Register of Deeds' Supplemental Pension Fund Schedule of County Contributions—Pension Plan. 6. Other Post-Employment Benefits Schedule of Changes in the Net OPEB Liability and Related Ratios. 7. Other Post-Employment Benefits Schedule of County Contributions. 8. Other Post-Employment Benefits Schedule of OPEB Investment Returns. 9. Law Enforcement Officers' Special Separation Allowance Schedule of Changes in the Total Pension Liability and Related Ratios. We have also been engaged to report on supplementary information other than RSI that accompanies the County's financial statements. We will subject the following supplementary information to the auditing procedures applied in our audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America and will provide an opinion on it in relation to the financial statements as a whole: 1. Schedule of expenditures of federal and state awards. 2. Combining and individual fund statements. 3. Supplemental ad valorem tax schedules. The following other information accompanying the financial statements will not be subjected to the auditing procedures applied in our audit of the financial statements, we have no responsibility for determining whether such other information is properly stated,and our auditor's report will not provide an opinion or any assurance on that other information: 1. Introductory section 2. Statistical section Audit Objectives The objective of our audit is the expression of opinions as to whether your basic financial statements are fairly presented, in all material respects,in conformity with U.S. generally accepted accounting principles and to report on the fairness of the supplementary information referred to in the second paragraph when considered in relation to the financial statements as a whole. The objective also includes reporting on - • Internal control over financial reporting and compliance with the provisions of laws, regulations, contracts and award agreements, noncompliance with which could have a material effect on the financial statements in accordance with Government Auditing Standards. • Internal control over compliance related to major programs and an opinion (or disclaimer of opinion) on compliance with federal statutes, regulations, and the terms and conditions of federal awards that could have a direct and material effect on each major program in accordance with the Single Audit Act Amendments of 1996 and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 Orange County - 2019 Engagement Letter May 31, 2019 Page 3 Principles, and Audit Requirements for Federal Awards(Uniform Guidance)as well as the State Single Audit Implementation Act. The Government Auditing Standards report on internal control over financial reporting and on compliance and other matters will include a paragraph that states (1)that the purpose of the report is solely to describe the scope of testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity's internal control or on compliance, and (2) that the report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. The Uniform Guidance report on internal control over compliance will include a paragraph that states that the purpose of the report on internal control over compliance is solely to describe the scope of testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Both reports will state that the report is not suitable for any other purpose. Our audit will be conducted in accordance with auditing standards generally accepted in the United States of America;the standards for financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; the Single Audit Act Amendments of 1996; the provisions of the Uniform Guidance; and the State Single Audit Implementation Act, and will include tests of accounting records, a determination of major program(s) in accordance with the Uniform Guidance and the State Single Audit Implementation Act, and other procedures we consider necessary to enable us to express such opinions. We will issue written reports upon completion of our Single Audit. Our reports will be addressed to the Members of the Board of Commissioners for Orange County, North Carolina. We will make reference to other auditor's report on the Orange County ABC Board in our report on your financial statements. We cannot provide assurance that unmodified opinions will be expressed. Circumstances may arise in which it is necessary for us to modify our opinions or add emphasis-of-matter or other-matter paragraphs. If our opinions on the financial statements or the Single Audit compliance opinions are other than unmodified, we will discuss the reasons with you in advance. If, for any reason, we are unable to complete the audit or are unable to form or have not formed opinions, we may decline to express opinions or to issue reports, or may withdraw from this engagement. Management Responsibilities Management is responsible for the financial statements, schedule of expenditures of federal awards, and all accompanying information as well as all representations contained therein. Management is responsible for (1) designing, implementing, and maintaining effective internal controls, including internal controls over federal awards, and for evaluating and monitoring ongoing activities,to help ensure that appropriate goals and objectives are met; (2) following laws and regulations; (3) ensuring that there is reasonable assurance that government programs are administered in compliance with compliance requirements; and(4) ensuring that management and financial information is reliable and properly reported. Management is also responsible for implementing systems designed to achieve compliance with applicable laws, regulations, contracts, and grant agreements. You are also responsible for the selection and application of accounting principles; for the preparation and fair presentation of the financial statements, schedule of expenditures of federal awards, and all accompanying information in conformity with U.S. generally accepted accounting principles; and for compliance with applicable laws and DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 Orange County - 2019 Engagement Letter May 31, 2019 Page 4 regulations (including federal statutes) and the provisions of contracts and grant agreements (including award agreements). Your responsibilities also include identifying significant contractor relationships in which the contractor has responsibility for program compliance and for the accuracy and completeness of that information. Management is also responsible for making all financial records and related information available to us and for the accuracy and completeness of that information. You are also responsible for providing us with (1) access to all information of which you are aware that is relevant to the preparation and fair presentation of the financial statements, (2) access to personnel, accounts, books, records, supporting documentation, and other information as needed to perform an audit under the Uniform Guidance, (3) additional information that we may request for the purpose of the audit, and(4) unrestricted access to persons within the government from whom we determine it necessary to obtain audit evidence. You are also responsible for coordinating our access to information relevant to the preparation and fair presentation of the financial statements of component units which may include discussions with component unit management and their auditors. Your responsibilities include adjusting the financial statements to correct material misstatements and confirming to us in the management representation letter that the effects of any uncorrected misstatements aggregated by us during the current engagement and pertaining to the latest period presented are immaterial, both individually and in the aggregate, to the financial statements taken as a whole. You are responsible for the design and implementation of programs and controls to prevent and detect fraud, and for informing us about all known or suspected fraud affecting the government involving (1) management, (2) employees who have significant roles in internal control, and (3) others where the fraud could have a material effect on the financial statements. Your responsibilities include informing us of your knowledge of any allegations of fraud or suspected fraud affecting the government received in communications from employees, former employees, grantors, regulators, or others. In addition, you are responsible for identifying and ensuring that the government complies with applicable laws, regulations, contracts, agreements, and grants. Management is also responsible for taking timely and appropriate steps to remedy fraud and noncompliance with provisions of laws,regulations,contracts,and grant agreements,or abuse that we report. Additionally, as required by the Uniform Guidance, it is management's responsibility to evaluate and monitor noncompliance with federal statutes, regulations, and the terms and conditions of federal awards; take prompt action when instances of noncompliance are identified including noncompliance identified in audit findings; promptly follow up and take corrective action on reported audit findings; and to prepare a summary schedule of prior audit findings and a separate corrective action plan. The summary schedule of prior audit findings should be available for our review subsequent to the start of fieldwork. You are responsible for identifying all federal and state awards received and understanding and complying with the compliance requirements and for the preparation of the schedule of expenditures of federal and state awards (including notes and noncash assistance received) in conformity with the Uniform Guidance and the State Single Audit Implementation Act. You agree to include our report on the schedule of expenditures of federal and state awards in any document that contains and indicates that we have reported on the schedule of expenditures of federal and DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 Orange County - 2019 Engagement Letter May 31, 2019 Page 5 state awards. You also agree to include the audited financial statements with any presentation of the schedule of expenditures of federal and state awards that includes our report thereon or make the audited financial statements readily available to intended users of the schedule of expenditures of federal and state awards no later than the date the schedule of expenditures of federal and state awards is issued with our report thereon. Your responsibilities include acknowledging to us in the written representation letter that (1) you are responsible for presentation of the schedule of expenditures of federal and state awards in accordance with the Uniform Guidance and the State Single Audit Implementation Act; (2)you believe the schedule of expenditures of federal and state awards, including its form and content, is stated fairly in accordance with the Uniform Guidance and State Single Audit Implementation Act; (3)the methods of measurement or presentation have not changed from those used in the prior period (or, if they have changed, the reasons for such changes): and (4) you have disclosed to us any significant assumptions or interpretations underlying the measurement or presentation of the schedule of expenditures of federal and state awards. You are also responsible for the preparation of the other supplementary information, which we have been engaged to report on, in conformity with U.S. generally accepted accounting principles. You agree to include our report on the supplementary information in any document that contains and indicates that we have reported on the supplementary information. You also agree to include the audited financial statements with any presentation of the supplementary information that includes our report thereon or make the audited financial statements readily available to users of the supplementary information no later than the date the supplementary information is issued with our report thereon.Your responsibilities include acknowledging to us in the written representation letter that(1)you are responsible for presentation of the supplementary information in accordance with GAAP; (2) you believe the supplementary information, including its form and content, is fairly presented in accordance with GAAP; (3) the methods of measurement or presentation have not changed from those used in the prior period (or, if they have changed, the reasons for such changes): and (4) you have disclosed to us any significant assumptions or interpretations underlying the measurement or presentation of the supplementary information. With regard to an exempt offering document with which Mauldin & Jenkins is not involved, you agree to clearly indicate in the exempt offering document that Mauldin & Jenkins is not involved with the contents of such offering document. Management is responsible for establishing and maintaining a process for tracking the status of audit findings and recommendations. Management is also responsible for identifying and providing report copies of previous financial audits, attestation engagements, performance audits or other studies related to the objectives discussed in the Audit Objectives section of this letter. This responsibility includes relaying to us corrective actions taken to address significant findings and recommendations resulting from those audits, attestation engagements,performance audits, or studies. You are also responsible for providing management's views on our current findings, conclusions, and recommendations, as well as your planned corrective actions, for the report, and for the timing and format for providing that information. DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 Orange County - 2019 Engagement Letter May 31, 2019 Page 6 With regard to the electronic dissemination of audited financial statements, including financial statements published electronically on your website, you understand that electronic sites are a means to distribute information and, therefore, we are not required to read the information contained in these sites or to consider the consistency of other information in the electronic site with the original document. You agree to assume all management responsibilities relating to the financial statements, schedule of expenditures of federal and state awards, related notes, and any other nonaudit services we provide. You will be required to acknowledge in the management representation letter our assistance with preparation of the financial statements, schedule of expenditures of federal and state awards, and related notes and that you have reviewed and approved the financial statements, schedule of expenditures of federal and state awards, and related notes prior to their issuance and have accepted responsibility for them. You agree to oversee the nonaudit services by designating an individual, preferably from senior management, who possesses suitable skill, knowledge, or experience; evaluate the adequacy and results of those services; and accept responsibility for them. Audit Procedures—General An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; therefore, our audit will involve judgment about the number of transactions to be examined and the areas to be tested. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We will plan and perform the audit to obtain reasonable rather than absolute assurance about whether the financial statements are free of material misstatement, whether from (1) errors, (2) fraudulent financial reporting, (3) misappropriation of assets, or (4) violations of laws or governmental regulations that are attributable to the government or to acts by management or employees acting on behalf of the government. Because the determination of abuse is subjective, Government Auditing Standards do not expect auditors to provide reasonable assurance of detecting abuse. Because of the inherent limitations of an audit, combined with the inherent limitations of internal control, and because we will not perform a detailed examination of all transactions, there is a risk that material misstatements or noncompliance may exist and not be detected by us, even though the audit is properly planned and performed in accordance with U.S. generally accepted auditing standards and Government Auditing Standards. In addition, an audit is not designed to detect immaterial misstatements or violations of laws or governmental regulations that do not have a direct and material effect on the financial statements or major programs. However,we will inform the appropriate level of management of any material errors, any fraudulent financial reporting or misappropriation of assets that come to our attention. We will also inform the appropriate level of management of any violations of laws or governmental regulations that come to our attention, unless clearly inconsequential, and of any material abuse that comes to our attention. We will include such matters in the reports required for a Single Audit. Our responsibility as auditors is limited to the period covered by our audit and does not extend to any later periods for which we are not engaged as auditors. DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 Orange County - 2019 Engagement Letter May 31, 2019 Page 7 Our procedures will include tests of documentary evidence supporting the transactions recorded in the accounts, and may include direct confirmation of receivables and certain other assets and liabilities by correspondence with selected individuals, funding sources, creditors, and financial institutions. We will request written representations from your attorneys as part of the engagement, and they may bill you for responding to this inquiry. At the conclusion of our audit, we will require certain written representations from you about your responsibilities for the financial statements; schedule of expenditures of federal awards; federal award programs; compliance with laws, regulations, contracts, and grant agreements; and other responsibilities required by generally accepted auditing standards. We plan to obtain and place reliance on the report of other auditors for the Orange County ABC Board, a discretely presented component unit of the County, assuming that our communications with the other auditors and review of their audit report and the financial statements of the Orange County ABC Board provide sufficient and appropriate audit evidence on which to base our overall opinion on the aggregate discretely presented component units. Audit Procedures—Internal Control Our audit will include obtaining an understanding of the government and its environment, including internal control, sufficient to assess the risks of material misstatement of the financial statements and to design the nature, timing, and extent of further audit procedures. Tests of controls may be performed to test the effectiveness of certain controls that we consider relevant to preventing and detecting errors and fraud that are material to the financial statements and to preventing and detecting misstatements resulting from illegal acts and other noncompliance matters that have a direct and material effect on the financial statements. Our tests, if performed, will be less in scope than would be necessary to render an opinion on internal control and, accordingly, no opinion will be expressed in our report on internal control issued pursuant to Government Auditing Standards. As required by the Uniform Guidance and the State Single Audit Implementation Act, we will perform tests of controls over compliance to evaluate the effectiveness of the design and operation of controls that we consider relevant to preventing or detecting material noncompliance with compliance requirements applicable to each major federal award program. However,our tests will be less in scope than would be necessary to render an opinion on those controls and, accordingly, no opinion will be expressed in our report on internal control issued pursuant to the Uniform Guidance and the State Single Audit Implementation Act. An audit is not designed to provide assurance on internal control or to identify significant deficiencies or material weaknesses. However, during the audit, we will communicate to management and those charged with governance internal control related matters that are required to be communicated under AICPA professional standards, Government Auditing Standards, and the Uniform Guidance. Audit Procedures—Compliance As part of obtaining reasonable assurance about whether the financial statements are free of material misstatement,we will perform tests of Orange County,North Carolina's compliance with provisions of applicable laws, regulations, contracts and agreements, including grant agreements. However,the objective of those procedures will not be to provide an opinion on overall compliance DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 Orange County - 2019 Engagement Letter May 31, 2019 Page 8 and we will not express such an opinion in our report on compliance issued pursuant to Government Auditing Standards. The Uniform Guidance and the State Single Audit Implementation Act requires that we also plan and perform the audit to obtain reasonable assurance about whether the auditee has complied with federal statutes,regulations, and the terms and conditions of federal and state awards applicable to major programs. Our procedures will consist of tests of transactions and other applicable procedures described in the OMB Compliance Supplement and the Audit Manual for Governmental Auditors in North Carolina, issued by the Local Government Commission, for the types of compliance requirements that could have a direct and material effect on each of Orange County's major programs. The purpose of these procedures will be to express an opinion on Orange County's compliance with requirements applicable to each of its major programs in our report on compliance issued pursuant to the Uniform Guidance and the State Single Audit Implementation Act. Other Services We will also assist in preparing the financial statements, schedule of expenditures of federal and state awards, and related notes of the County in conformity with U.S. generally accepted accounting principles and the Uniform Guidance based on information provided by you. These nonaudit services do not constitute an audit under Government Auditing Standards and such services will not be conducted in accordance with Government Auditing Standards. We will perform these services in accordance with applicable professional standards. The other services are limited to the financial statements, schedule of expenditures of federal and state awards, and related notes services previously defined. We,in our sole professional judgement,reserve the right to refuse to perform any procedure or take any action that could be construed as assuming management responsibilities. Audit Administration, Fees, and Other We understand that your employees will prepare all cash or other confirmations we request and will locate any documents selected by us for testing. At the conclusion of the engagement, we will complete the appropriate sections of the Data Collection Form that summarizes our audit findings. It is management's responsibility to electronically submit the reporting package (including financial statements, schedule of expenditures of federal awards, summary schedule of prior audit findings, auditors' reports, and corrective action plan)along with the Data Collection Form to the federal audit clearinghouse. We will coordinate with you the electronic submission and certification. The Data Collection Form and the reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditors' reports or nine months after the end of the audit period. We will provide copies of our reports to Orange County, North Carolina; however, management is responsible for distribution of the reports and financial statements. Unless restricted by law or regulation, or containing privileged and confidential information, copies of our reports are to be made available for public inspection. DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 Orange County - 2019 Engagement Letter May 31, 2019 Page 9 The audit documentation for this engagement is the property of Mauldin&Jenkins and constitutes confidential information. However, pursuant to authority given by law or regulation, we may be requested to make certain audit documentation available to a federal agency providing direct or indirect funding, or the U.S. Government Accountability Office for purposes of a quality review of the audit,to resolve audit findings, or to carry out oversight responsibilities. We will notify you of any such request. If requested, access to such audit documentation will be provided under the supervision of Mauldin & Jenkins personnel. Furthermore, upon request, we may provide copies of selected audit documentation to the aforementioned parties.These parties may intend,or decide, to distribute the copies or information contained therein to others, including other governmental agencies. The audit documentation for this engagement will be retained for a minimum of five years after the report release date or for any additional period requested by a regulatory body. If we are aware that a federal awarding agency, pass-through entity, or auditee is contesting an audit finding, we will contact the party (ies) contesting the audit finding for guidance prior to destroying the audit documentation. We expect to begin our audit on approximately September 9,2019 and to issue our reports no later than October 31, 2019. James Bence is the engagement partner and is responsible for supervising the engagement and signing the reports or authorizing another individual to sign them. Our fee for these services will be $82,500 for the year ended June 30, 2019. Our hourly rates vary according to the degree of responsibility involved and the experience level of the personnel assigned to your audit. Our invoices for these fees will be rendered as work progresses and are payable upon presentation. The above fees are based on anticipated cooperation from your personnel (including complete and timely receipt by us of the information on the respective client participation listings to be prepared annually) and the assumption that unexpected circumstances (including scope changes) will not be encountered during the audit. If significant additional time is necessary, we will discuss it with management and arrive at a new fee estimate before we incur the additional costs. As a result of our prior or future services to you, we might be requested or required to provide information or documents to you or a third party in a legal, administrative, arbitration, or similar proceeding in which we are not a party. If this occurs, our efforts in complying with such requests will be deemed billable to you as a separate engagement. We shall be entitled to compensation for our time and reasonable reimbursement for our expenses (including legal fees) in complying with the request. For all requests we will observe the confidentiality requirements of our profession and will notify you promptly of the request. DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 Orange County - 2019 Engagement Letter May 31, 2019 Page 10 We appreciate the opportunity to be of service to Orange County,North Carolina and believe this letter accurately summarizes the significant terms of our engagement. If you have any questions, please let us know. If you agree with the terms of our engagement as described in this letter,please sign the enclosed copy and return it to us. Sincerely, MAULDIN &JENKINS, LLC James Bence RESPONSE: This letter co--�--oocu'signe`d ay--`'- ` -understanding of Orange County,North Carolina. B>' 7�0�4E�51S1A14 Title: Finance Director 7/2/2019 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 A ��0 CERTIFICATE OF LIABILITY INSURANCE DATE(M 08/22//2018 Y) 018 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER.THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND,EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S),AUTHORIZED REPRESENTATIVE OR PRODUCER,AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder is an ADDITIONAL INSURED,the policy(ies)must have ADDITIONAL INSURED provisions or be endorsed. If SUBROGATION IS WAIVED,subject to the terms and conditions of the policy,certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). PRODUCER CONTACT Brenda Durham NAME: PointeNorth Insurance Group,LLC PAHi�NNo Ext: (770)858-7540 C,No): (770)858-7545 PO Box 724728 E-MAIL bdurham@pointenorthins.com ADDRESS: INSURER(S)AFFORDING COVERAGE NAIC# Atlanta GA 31139 INSURERA: Cincinnati Insurance Company 10677 INSURED INSURER B: The Hartford-Rated by Multiple Companies 00914 Mauldin&Jenkins,LLC INSURER C: 200 Galleria Parkway SE INSURER D: Suite 1700 INSURER E: Atlanta GA 30339-5946 INSURER F: COVERAGES CERTIFICATE NUMBER: 2018/2019 Master REVISION NUMBER: THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT,TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN,THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES.LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INSR ADDLSUBR TYPE OF INSURANCE POLICY EFF POLICY EXP LIMITS LTR INSD WVD POLICY NUMBER (MM/DD/YYYY) (MM/DD/YYYY) X COMMERCIAL GENERAL LIABILITY EACH OCCURRENCE $ 2,000,000 DAMAGE To CLAIMS-MADE � OCCUR PREMISES Ea occurrence)l $ 2,000,000 MED EXP(Any one person) $ 5,000 A Y ECP0258054 07/01/2018 07/01/2019 PERSONAL&ADV INJURY $ 2,000,000 GEN'LAGGREGATE LIMIT APPLIES PER: GENERAL AGGREGATE $ 4,000,000 X POLICY ❑ PRO ❑ LOC PRODUCTS-COMP/OP AGG $ 4,000,000 JECT OTHER: $ AUTOMOBILE LIABILITY COMBINED SINGLE LIMIT $ 1,000.000 (Ea accident) ANYAUTO BODILY INJURY(Per person) $ A OWNED SCHEDULED ECP0258054 07/01/2018 07/01/2019 BODILY INJURY(Per accident) $ AUTOS ONLY AUTOS X HIRED �/ NON-OWNED PROPERTY DAMAGE $ AUTOS ONLY /� AUTOS ONLY (Per accident) X UMBRELLA LIAB X OCCUR EACH OCCURRENCE $ 11,000,000 A EXCESS LIAB CLAIMS-MADE EXS0262115 07/01/2018 07/01/2019 AGGREGATE $ 11,000,000 DED I X1 RETENTION $ 0 $ WORKERS COMPENSATION X STATUTE EORH AND EMPLOYERS'LIABILITY Y/N ANY PROPRIETOR/PARTNER/EXECUTIVE E.L.EACH ACCIDENT $ 500,000 B OFFICER/MEMBEREXCLUDED? ❑ NIA 20WECAI5405 08/31/2018 08/31/2019 (Mandatory in NH) E.L.DISEASE-EA EMPLOYEE $ 500,000 If yes,describe under 500,000 DESCRIPTION OF OPERATIONS below E.L.DISEASE-POLICY LIMIT $ DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES (ACORD 101,Additional Remarks Schedule,may be attached if more space is required) CERTIFICATE HOLDER CANCELLATION SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF,NOTICE WILL BE DELIVERED IN Orange County North Carolina ACCORDANCE WITH THE POLICY PROVISIONS. 200 South Cameron Street AUTHORIZED REPRESENTATIVE Hillsborough NC 27278 W' g Z� ©1988-2015 ACORD CORPORATION. All rights reserved. ACORD 25(2016/03) The ACORD name and logo are registered marks of ACORD DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 1 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: June 18, 2019 Action Agenda Item No. 8-f SUBJECT: Audit Contract Renewal with Mauldin & Jenkins, LLC DEPARTMENT: Finance and Administrative Services ATTACHMENT(S): INFORMATION CONTACT: Attachment 1: Mauldin & Jenkins, LLC Gary Donaldson, (919) 245-2453 Proposal PURPOSE: To: 1) Exercise the first of three one-year renewal options for Mauldin & Jenkins to perform audit services for Orange County pursuant to Request for Proposals (RFP) 5215 of the original audit contract approved by Board of County Commissioners on March 22, 2016; and 2) Authorize the requisite County signatures as required by the North Carolina Local Government Commission. BACKGROUND: The Board approved an audit services contract with Mauldin & Jenkins for a three-year term on March 22, 2016, including the opportunity for three one-year renewal options. The initial three years covered the period from FY 2015-16 through FY 2017-18. Staff proposes to exercise the first audit renewal option for the completion of the FY 2018-19 financial and compliance audit. The audit services will encompass a financial and compliance examination of the County's Comprehensive Annual Financial Report (CAFR) in accordance with the laws of the State of North Carolina. The financial and compliance audit will cover federal, state and local funding sources in accordance with the Federal and State Single Audit Acts; applicable laws and regulations; and generally accepted auditing standards. FINANCIAL IMPACT: Funds were included in the Manager's Recommended FY 2019-20 Operating Budget for the audit contract. The cost to conduct the audit services for the first renewal year is $82,500. SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goal is applicable to this item: • GOAL: ENSURE ECONOMIC SELF-SUFFICIENCY The creation and preservation of infrastructure, policies, programs and funding necessary for residents to provide shelter, food, clothing and medical care for themselves and their dependents. RECOMMENDATION(S): The Manager recommends that the Board: 1) Approve exercising the first renewal option pursuant to original audit contract award; and 2) Authorize the requisite County signatures of the audit renewal contract as required by the North Carolina Local Government Commission. DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 Attachment 1 2 AULDIN & ENKINS Over 400 Governmental Units served INSIDE PUBLI( A(COUNTING TOP 100 0 [ FIRMS 2018 We Do Things Right & We Do the Right Things DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 3 AULDIN Oranae County Quote to Provide Auditing Services March 20, 2019 Mr.Gary Donaldson Orange County 200 South Cameron Street Hillsborough, NC 27278 Dear Mr. Donaldson: Mauldin & Jenkins, LLC is very excited about the opportunity to continue to work with the County. We appreciate the opportunity to continue our relationship in providing independent auditing services to Orange County, North Carolina (the "County"). As professionals serving the public sector, specializing in services to all local governments,we believe our firm is eminently qualified to serve the County. As professionals serving the public sector, Mauldin & Jenkins is best qualified to serve the County. We believe that Mauldin & Jenkins is the leader in auditing state and local governments in the Southeast. This leadership was achieved by recognizing that we are an important part of our client's success,with our objective being to ensure that accurate information is reported to the Board of Commissioners, management, and its citizens. Given the complexities of the County's financial operations and the ongoing significant changes in accounting standards, we feel that it is very important that you select an auditing firm that is focused and experienced in the governmental industry. This is experience that cannot be matched by any other firm. We differentiate ourselves from our peers in the following ways: Experience with Governments. As auditors for governments on a ful-time basis, throughout the year, our professionals are thoroughly versed in the complex governmental arena, and have consistently provided the highest quality of service to our government clients. Consider the following: • We audit 55 counties,including five counties in North Carolina. • We audit 116 municipalities, including three muncicpalities in North Carolina and 8 of the largest 10 cities in Georgia. • We serve 120 governments awarded the GFOA's Financial Reporting Certificates. • We are highly involved in various national and state governmental associations. Mauldin &Jenkins provides over 80,000 hours of service to over 400 overnmental units in the Southeast on an annual basis. Such experience results in the utilization of over 90 professionals. Mauldin,&Jenkins, LLC Page T DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 4 QuoteAULDIN Orange County ❖ Staff Continuity. Our staff retention rates are considered to be among the best in the profession (and much better than national and other regional firms). This fact, coupled with our vast array of government clients, results in a staff pool highly experienced with governmental entities with the definite capacity to serve the County. We are able to not only provide consistency with the partner and manager on our engagement teams, but seniors as well. We also have enough resources at the partner, manager, and senior levels to provide for periodic rotations as requested by our clients. + Education. Mauldin & Jenkins' clients have the OPRortunity to register and receive approximately thin 30 hours of continuing education on an annual basis free of charge. We take our experience in serving governments, and choose timely and relevant topics to provide ongoing education to our clients. Sessions are limited to clients only. This amounts to a cost savings of approximately$3,000 per individual per year. • Responsiveness. We pride ourselves in responding to the needs of our clients and meeting their deadlines. This responsiveness is not only the ability to meet specified audit deadlines, but also the ability to respond to other requests. Our ability to be responsive is enhanced by the open communications and good working relationship we have with our clients. Our resources provide for the flexibility to meet your needs and to perform our services in an efficient and effective manner. •;• Organized to Specifically Meet Your Needs. Our partners, managers, and seniors in the Firm's Governmental Practice Division spend 100% of their time serving governments. By structuring the Firm's Governmental Practice Division in such a manner, we are able to create efficiencies in the audit process which typically result in our total hours being significantly less than most other firms. Nationally Recognized. Mauldin & Jenkins is consistently ranked in the Top 100 by Accounting Today as well as Inside Public Accounting trade associations and magazines as one (1) of the largest certified public accounting firms in the country. Tommye Barie (a governmental audit partner with Mauldin & Jenkins)served as the 2015 Chair of the Board of Directors of the AICPA. Orange County is an important client to Mauldin &Jenkins and one that we would be proud to continue to serve. Again, on behalf of Mauldin & Jenkins, we are excited about this opportunity to continue the relationship with the County and look forward to working to help meet the continuing challenges you face. This proposal represents a firm offer for 120 days from the date of the proposal. As a member of Mauldin & Jenkins, Joel Black is authorized to bind, and make representations for the Firm, and he will be the ultimate party responsible for the quality of the report and working papers. We welcome the opportunity to meet with management and governing board officials to present our proposal and our qualifications. Please contact us at (800) 277-0080, 200 Galleria Parkway SE, Suite 1700, Atlanta, Georgia 30339. Again, on behalf of Mauldin &Jenkins,thank you for the opportunity to serve. Sincerely, MAULDIN &JENKINS, LLC Joel Black, Partner Mauldin&Jenkins,t1.0 Page 2 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 5 QuoteT\4AULDfN &j ENKINS Orange County Firm Qualifications and Experience Organization and Size Mauldin &Jenkins was formed in 1918 and has been actively engaged in governmental auditing since its inception. Mauldin & Jenkins is considered to be one of Georgia's largest locally owned provider of audit and accounting services, and one of the largest certified public accounting firms in the country. Mauldin & Jenkins serves clients throughout the Southeastern United States. Mauldin & Jenkins is considered to be a large regional firm. We have offices in the following communities: Atlanta, GA "Albany,Albany, GA " Macon,Macon, GA " Savannah,Savannah, GA Birmingham, AL ** Bradenton, FL Columbia, SC ** Chattanooga, TN As noted in our transmittal letter, Mauldin & Jenkins provides and supervises over 80,000 hours_of service to governmental entities on an annual_basis. The Firm's governmental practice is the largest niche in the Firm and is approximately 27% of the Firm's total practice. However, size and resources alone are not the most meaningful measure of success; in the end, our clients remain the best judges of Mauldin&Jenkins'value. Other key information relative to the size and experience of Mauldin &Jenkins is as follows: • 300,000-approx.total hours of service provided annually to clients of the Firm • 85,000-approx.total hours of service provided annually to governmental clients of the Firm • 40%-percentage of governmental practice as compared to Firm's attestation practice ■ 25%-percentage of governmental practice as compared to Firm's overall practice ■ 400-approx.total governmental entities served in past three(3)years ■ 280_total number of Firm personnel ■ 120-total clients served who obtain the GFOA/ASBO Certificates ■ 44-total clients with publicly issued debts in excess of$50 million • 52-total number of Firm partners • 11-total number of full-time governmental partners&directors • 11-total number of full-time governmental managers • 90-total number of professionals with current governmental experience Mauldin&Jenkins,LLC Page 3 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 MAULDIN &j ENKINS Orange County Quote to Provide Auditing,Services Serving Governments For A Center►► Mauldin &Jenkins' commitment to government began when our Firm was established in 1918. Since then, we have viewed service to governments as significant to the overall success of the Firm. Today, the governmental sector is an industry that has been specifically identified for our continued growth in professional services. Accordingly, all professionals, from entry-level accountants to partners (who select the governmental sector as their focus) are trained to understand the issues and meet the needs of state and local governmental entities. t As noted previously, Mauldin &Jenkins employs 22 partners, directors and managers who dedicate 100% of their time serving government clients. We also have numerous additional professionals with current experience in providing services to governmental entities — many of whom spend their time exclusively on government clients. Mauldin & . Jenkins' dedicated professionals can bring a comprehensive understanding of the issues that face government entities as +� well as "bench strength" at all levels, allowing us to respond aw swiftly and effectively to your evolving needs. The goal of our government practice is to help governments improve their financial processes and strategies so that they can in turn achieve their goal of improving the lives of their citizens. This shared commitment to the goals of our clients has resulted in a significant government clientele. As noted in our transmittal letter,we currently serve approximately 400 governments in the Southeast. We know of no other firm that can match our experience. Mauldin & Jenkins has obtained significant relevant experience serving governmental entities over the years by serving a wide variety of governmental entities. Just over the past three (3) years, we have annually served over 150 city/county local governments of all sizes across the Southeast. Additionally, over the past three (3) years, we have served more than 80 school systems and charter schools, approximately 40 state agencies, and another 105 special purpose entities (special districts, authorities, commissions, etc.). We also are currently serving 120 governmental entities who annually obtain the GFOXs Certificate of Achievement for Excellence in Financial Reporting. Mauldin&Jenkins.LLC Page 4 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 M_ AULDfN Quote Key Members of Proposed Encasement Team In order to provide the highest quality service in the most cost efficient manner, Mauldin &Jenkins has formed a client service team which will function as a cohesive unit, and would represent a superb assortment of talent and experience for the audit of the County. The unit would be assembled as: i 4r _ i I Joel Black Adam Fraley Engagement Partner Quality Control Partner Kris Trainor Certified Fraud i Examinerf, James Bence Audit Service Partner Audit Engagement Team The above team dedicated to audit the County will include (at a minimum): three (3) partners, one supervisor,and at least two (2) staff professionals. The Audit Service Partner and the staff professionals will be substantially on-site full time throughout the conduct of their role in the audit. Other governmental audit professionals will be available to assist throughout the fieldwork and the preparation of the financial reports. The audit partner in-charge of fieldwork will correspond with County management on financial reporting, audit, and related issues on an ongoing basis, and this individual will also be dedicated to serve the County throughout fieldwork, reporting and conclusion in ail respective fiscal years. Mauldin &Jenkins has the depth of resources which allows us to provide you with significant resources of knowledgeable professionals to meet your deadlines. Mauldin&Jenkins, LLC Page 5 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 8 AULDIN • ENKINS 01'ange County Quote to Pi-ovide Auditing Sei-vices Governments Served in Past Three Years Perhaps the greatest indicator of our reliability as a professional service provider to state and local governments is our list of governmental clients. Counties. Counties we have audited or are in the process of serving within the past three(3)years are: Ggg 16) Forsyth 31) Monroe South Carolina 1) Athens-Clarke 17) Glynn 32) Newton 44) Beaufort 2) Augusta-Richmond 18) Gwinnett 33) Paulding 45) Col Ieton 3) Columbus-Muscogee 19) Henry 34) Peach 46) ❑arlington 4) Macon-Bibb 20) Jackson 35) Rockdale 47) Edgefield 5) Bacon 21) Jeff Davis 36) Spalding 48) Lancaster 6) Barrow 22) Jones 37) Stephens 49) Laurens 7) Chatham 23) Lee 38) Taylor 50) Oconee g) Cherokee 24) Li berty 39) Toombs 9) Clayton 25) Lincoln 40) Union North Carolina] 10) Colquitt 26) Long 41) Walton 51) Gates 11) Crisp 27) Lumpkin 42) Whitfield 52) Halifax 12) DeKalb 28) Macon 53) Madison 13) Dougherty 29) McIntosh Tennessee 54) Orange 14) Douglas 30) Mitchell 43) Hamilton 55) Washington 15) Floyd Mauldin&Jenkins,LLC Page 6 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 M- AULDfN &j ENKINS Orange County Quote to Provide Auditing Services Cities. Cities we have audited or are in the process of serving within the past three(3)years are: Geor i 32) Grantville 64) Savannah 94) North Port 1) Albany 33) Griffin 65) 5harpsburg 95) Pensacola 2) Alpharetta 34) Gum Branch 66) Social Circle 96) Pinecrest 3) Americus 35) Hapeville 67) South Fulton 97) Plant City 4) Austell 36) Hinesville 68) St.Marys 98) Wiidwood 5) Baldwin 37) Jefferson 69) Stockbridge 6) Ball Ground 38) Jeffersonville 70) Stonecrest Alabama 7) Blakely 39) Johns Creek 71) Suwanee 99) Tuscaloosa 8) Bloomingdale 40) Kennesaw 72) Thunderbolt 9) Brasenton 41) I(ingsland 73) Tifton North Carolina 10) Brookhaven 42) Lawrenceville 74) Toccoa 100) Garner 11) Brunswick 43) Leesburg 75) Tucker 101) New Bern 12) Cartersville 44) Ulburn 76) Tybee Island 102) Selma 13) Cedartown 45) Ludowici 77) Union City 14) Chamblee 46) Lyons 78) Valdosta South Carolina 15) Chattahoochee Hills 47) Milledgeville 79) Vernonburg 103)Aiken 16) Clarkston 48) Milton 80) Villa Rica 104)Beaufort 17) Cochran 49) Monroe 105)Chapin 18) College Park 50) Morrow Figrida 106)Charleston 19) Conyers 51) Peachtree City 81) Arcadia 107)Clover 20) Cordele 52) Peachtree Corners 82) Bradenton 108)Hardeeviile 21) Covington 53) Perry 83) Callaway 109)Hollywood 22) Decatur 54) Pooler 84) Cooper City 110)Goose Creek 23) Doraville 55) Powder Springs 85) Crystal River 111)Loris 24) Douglasville 56) Quitman 86) Ft.Myers Beach 112)Orangeburg 25) Duluth 57) Port Wentworth 87) Haines City 113)Summerville 26) Dunwoody 58) Richmond Hill 88) Hallandale Beach 27) Fairburn 59) Riverdale 89) Islamorada Tennessee 28) Fayetteville 60) Rockmart 90) Lake Placid 114) Bristol 29) Flovilla 61) Rome 91) Long Boat Key 115) Crossville 30) Forest Park 62) Roswell 92) Marco Island 116) Jamestown 31) Garden City 63) Sandy Springs 93) Naples Mauldin&Jenkins, LLC Page 7 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 10 MAULMN &_J FNKINS Orange County Quote to Provide Awliting Sei-vices State Governmental Entities. The State of Georgia has several agencies, departments and component units that are audited by an independent public accounting firm. We currently audit the majority of the State of Georgia's component units, and we audit approximately 12 billion or 30% of the State of Georgia's General Fund. Additionally, we audit several entities that are part of the State of Alabama's financial reporting entity. Please see the following for a listing of State governmental entities we have audited in the past three(3)years: 1) Georgia Building Authority 19) Georgia Military College Foundation 2) Georgia Department of Community Health 20) Georgia Southern University Foundation 3) Georgia Education Authority 21) Kennesaw State University Athletic Association 4) Georgia Environmental Finance Authority 22) Kennesaw State University Foundation 5) Georgia Higher Education Assistance Corp. 23) Kennesaw State University Research Foundation 6) Georgia Higher Education Facilities Auth. 24) Medical College of Georgia Foundation 7) Georgia Lottery Corporation 2S) New College of Florida 8) Georgia Ports Authority 26) Northwest Florida College Foundation 9) Georgia State Financing&Investment Commission 27) Southern Polytechnic Applied Research Foundation 10) Georgia Student Finance Authority 28) Southern Polytechnic State University Foundation 11) Georgia Student Finance Commission 29) State College of Florida Foundation 12) Georgia Superior Court Clerks'Coop.Authority 30) State College of Florida Sarasota-Manatee, Inc. 13) Georgia State Road and To]Iway Authority 31) Stone Mountain Memorial Association 14) Alabama Higher Education Loan Corporation 32) University of Chattanooga Foundation 15) Alabama Prepaid Affordable College Tuition 33) Unlversity of North Georgia Foundation 16) Abraham Baldwin Agricultural College Foundation 34) University of North Georgia Real Estate Foundation 17) College of Coastal Georgia Foundation 3S) University of West Georgia Athletic Foundation 18) Georgia College&State University Foundation 36) University of West Georgia Foundation 37) University System of Georgia Foundation Mauldin&Jenkins, LLC Page 8 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 11 M- AULDTN Quote to Provide Audifing Ser,.riCeS School Systems. Boards of Education we have served within the past three(3)years are: Georgig 32) Hancock County Board of Education 1) Atlanta I nd ependent Sc h ool System 33) Harris County Board of Education 2) Baker County Board of Education 34) Henry County Board of Education 3) Bartow County Board of Education 35) Marion County Board of Education 4) Bibb County Board of Education 36) Oconee County Board of Education 5) Bleckley County Board of Education 37) Paulding County Board of Education 6) Brooks County Board of Education 38) Peach County Board of Education 7) Butts County Board of Education 39) Polk County Board of Education 8) Camden County Board of Education 40) Putnam County Board of Education 9) Carroll County Board of Education 41) Rockdale County Board of Education 10) Cherokee County School District 42) Savannah-Chatham Co.Public School System 11) City of Buford Board of Education 43) Thomas County Board of Education 12) City of Carrot Eton Board of Education 44) Troup County Board of Education 13) City of Cartersville Board of Education 45) Twiggs County Board of Education 14) City of Decatur Board of Education 46) Walton County Board of Education 15) Cityof Gainesville Board of Education 47) Ware County Board of Education 16) Cityof Jefferson Board of Education 17) City of Marietta Board of Education Florida 18) City of Rome Board of Education 48) School Board of highlands Country 19) Clay County Board of Education 49) School Board of Manatee County 20) Clayton County Board of Education 50) School District of Lee County 21) Cobb County Board of Education 22) Coweta County Board of Education Tenneess 23) DeKalb County Board of Education 51) City of Bristol Board of Education 24) Dodge County Board of Education 52) Hamilton County Department of Education 25) Douglas County Board of Education 26) Emanuel County Board of Education South Carolina 27) Fayette County Board of Education 53) Lexington School ❑istrict Four 28) Forsyth County Board of Education 54) Marlboro County School District 29) Fulton County Board of Education 55) Richland County School District One 30) Glynn County Board of Education 56) Sumter County School District 31) GwinnettCounty Board of Education Mauldin&Jenkins,LLC Page 9 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 12 MAULMN Orange County Other Governments. Other governmental entities we have audited within the past three(3)years are: 1) Academy for Classical Education(ACE) 66) Gwinnett County Water and Sewerage Auth. 2) Albany-Dougherty Inner City Auth. 67) Gwinnett Online Campus 3) Atlanta Development Auth. 68) Hamilton Co.Water&Wastewater Treatment Auth. 4) Atlanta Economic Renaissance Corporation 69) Hamilton County Election Commission 5)Atlanta Heights Charter Academy 70) Heart of Georgia Altamaha Regional Commission 6)Atlanta Housing Opportunity 71) Henry County Water Authority 7)Austell Natural Gas System 72) Historic Roswell Convention&Visitors Bureau 8) Barrow County Water&Sewer Authority 73) Housing Authority of Clayton County 9) Bartram Trail Regional Library 74) Houston County Library System 10) Bayshore Gardens Park&Recreation District 75) Imagine School at North Part 11) Birmingham Jefferson County Transit Auth. 76) Imagine School at Palmer Ranch 12) Bradenton Downtown Development Auth. 77) Imagine-East Manatee County,LLC 13) Brighten Academy 78) Imagine-Manatee County,LLC 14) Bristol Joint Sewer System 79) lsiamorada,Viliage of Islands,Florlda 15) Bristol Public Library 80) ivy Preparatory Academy at Gwinnett 16) Central Community Redevelopment Agency 81) Ivy Preparatory Academy far Girls 17) Central Midlands Regional Transit Auth. 82) Ivy Preparatory Young Men's Leadership Academy 18) Central Savannah River Area Regional Comm. 83)Jefferson Co.Economic and Industrial Dev Auth. 19) Charleston Water System 84)Just for Girls Academy 20) Chatsworth Water Works Commission 85) Keep Peachtree City Beautiful Commission 21)Chattahoochee River 911 Auth. 86) Kendexi School 22) Chattanooga Area Reg.Transportation Auth. 87) Kennesaw State University Athletic Department 23) Chattanooga Area Regional Council of Govts. 88) KIPP Metro Atlanta Collaborative 24) Cherokee Charter Academy 89) KIPP Opportunity Fund 25) Cherokee County Airport Auth. 90) KIPP South Fulton Academy 26) Clty of Albany-Chehaw Park Auth. 91) Lumpkin County Hospital Auth. 27) City of Albany-Water,Gas&Light Comm. 92) Lumpkin County Water&Sewerage Auth. 28) City of East Point Retirement Plan 93) Macon Water Authority 29) City of North Port,F€.-Firefighters'Pension 94) Macon-Bibb County Land Bank Authority 30) City of Sandy Springs Development Auth. 95) Manatee County Mosquito Control Dist 31) Classic Center Auth.of Clarke County 96) Manatee Technical Institute 32) Clayton Co.Pension Fund 97) MARTA/ATU Local 732 Employees Retirement 33) Clayton County Water&Sewer Authority 98) McIntosh Trail Community 5ervice Board 34) Cobb County-Marietta Water Authority 99) McPherson Implementing Local Redev.Auth. 35) Cobb County-Marietta Water Auth.Pension 100) McPherson Planning Local Redevelopment Auth. 36) Columbia County Board of Health 101) Middle Georgia Community Service Board 37) Convention and Visitors Bureau of Dunwoody 102) Milledgeville-Baldwin County Dev.Auth. 38) Coweta Charter Academy 103) Mount Pleasant Waterworks 39) Crisp County-Cordele Industrial Development 104) NE Corridor,LLC 40) Crisp County Power Commission 105) Newton County Water&5 ewe rage Auth. 41) DeKalb County Public Library 106) North Fulton Regional Radio Auth. 42) Dev.Auth.of City of Jeffersonville&Tw€ggs Co. 1D7) Northeast Georgia Regional Commission 43) Development Auth.of Cherokee County 108) Northwest Florida State College-Collegiate High School 44) Development Auth.of City of Rosweli,GA 109) Northwest Florida State College Foundation 45) Development Auth.of Lumpkin County 110) Ocean Highway and Port Auth.of Nassau County 46) Development Auth.of Peachtree City 111) Oconee Center Community Service Board 47) Downtown Atlanta Revitalization 112) Pataula Charter Academy 48) Eatonton-Putnam Water&Sewer Authority 113) Peace Rive r/Ma n a sota Reg Water Supply Auth. 49) Electric Power Board of Chattanooga 114) Peachtree City Convention&Visitor's Bureau 50) Forsyth County Public Library 115) Peachtree City Water&Sewerage Auth. 51) Friends of Bulloch 116) Phoenix Center Community Service Board 52) Georgia Charter Educational Foundation 117) Phoenix Center Community Service Board 53) Georgia Charter Educational Foundation 118) Provost Academy Georgia 54) Georgia Online Academy 119) Public Bldg.Auth.of Knox Co.&City of Knoxville 55) Georgia Ports Auth.DB&OPEB Plan 120) Riverdale Downtown Development Auth. 56) Georgia Ports Auth.Defined Contribution Plan 121) River's Edge Community Service Board 57) Griffin 5paIding County Land Bank Auth. 122) Sandy Springs Hospitality Board 58) Gwinnett Civic/Cu lturaI Center Operations 123)Sarasota School of Arts&Sciences 59) Gwinnett Convention and Visitors Bureau 124)Southeast Tennessee Development District 60)Gwinnett County Airport Auth. 125)SOWEGA Council on Aging 61)Gwinnett County BOE Charter Schools 126)State College of Florida-Collegiate High School 62) Gwinnett County Development Auth. 127)Student Leadership Academy of Venice 63) Gwinnett County Public Facilities Auth. 128)Toccoa-Stephens County Public Library 64) Gwinnett County Public Library 129)Town Center Area Community Imp.District 65) Gwinnett County Recreation Auth. 130)Troup County College&Career Academy 131)Walton County Water&Sewerage Auth. Mauldin&Jenkins,LLC Page 10 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 13 AULDIN Orange County Quote to Provide Auditing Set-vices CAFR Certificates of Achievement& Excellence Mauldin &Jenkins has served approximately 400 governments in the past several years, and 120 governmental units who obtain the GFOA's Certificate of Achievement for Excellence in Financial Reporting. m Mauldin &Jenkins'clients have neverfailed to obtain the Certificate! Mauldin & Jenkins is batting 100%. Every CAFR submitted has received the award. The following are current clients: Counties: 24) Oconee Co.,SC 46) Cha mbl ee 70) Longboat Key,FL 1) Athens-Clarke Co. 25) Orange Co.,NC 47) Charleston,5C 71) Milledgevi I le 2) Augusta-Richmond Co. 26) PauIdingCo. 48) Chamblee 72) Milton 3) Barrow Co. 27) Rockdale Co. 49) College Park 73) Monroe 4) Beaufort Co.,SC 28) Spalding Co. 50) Conyers 74) Morrow 5) Chatham Co. 29) Walton Co. 51) Cooper City,FL 75) Naples,FL 6) Cherokee Co. 30) Washington Co.,NC 52) Covington 76) New Bern,NC 7) Clayton Co. 31) Whitfield Co. 53) Decatur 77) North Port,FL 8) Colleton Co.,SC 54) Douglasville 78) Peachtree City 9) Columbus-Muscogee Co. Cities: 55) Dunwoody 79) Pensacola,FL 10) DekaIb Co. 32) Aiken,SC 56) Fayetteville 80) Perry 11) Douglas Co. 33) Albany 57) Fairburn 81) Pinecrest,FL 12) Edgefield Co.,SC 34) Alpharetta 58) Forest Park 82) Pooler 13) Floyd Co. 35) Americus 59) Garden City 83) Port Wentworth 14) Forsyth Co. 36) Austell 60) Griffin 84) Riverdale 15) Glynn Co. 37) Ball Ground 61) Haines City,FL 85) Rockmart 16) Gwin nett Co. 38) Beaufort,SC 62) Hallandale Bch,FL 86) Rome 17) Halifax Co.,NC 39) Bluffton,SC 63) Hapeville 87) Roswell 18) Hamilton Co.,TN 40) Bradenton,FL 64) Ha rdeevi I I e,SC 88) Sandy Springs 19) Henry Co. 41) Bristo1,TN 65) Hinesville 89) Savannah 20) Jackson Co. 42) Brookhaven 66) John's Creek 90) 5uwanee 21) Lancaster Co.,SC 43) Brunswick 67) Kennesaw 91) Tuscaloosa,AL 22) Liberty Co. 44) Callaway,FL fib) Kingsland 92) Union City 23) Macon-Bibb Co. 45) Cartersville 69) Marco Island,FL 93) Valdosta Boards of Education: Other Governmental Entities: 94) Atlanta Pubiic Schools 108) Central Savannah River Area Regional Comm. 95) Bibb CountySc hoot s 109) Charleston Water System 96) Cartersville City Schools 110) Clayton County Wa ter Auth . 97) Clayton County Schools 111) Cobb County-Marietta Water Authority 98) Cobb County Schools 112) Greenwood Commissioners of Public Works 99) Fayette County schools 113) Greer Commission of Public Works 100) Fulton County Schools 114) Henry County Water Auth. 101) Gwi n nett County schools 115) Lowcountry Regional Transportation Authority 102) Lee County School District 116) Macon Water Authority 103) Marietta City Schools 117) Mount Pleasant Waterworks 104) Ri chi and Co.School District One 118) Public Building Authority of Knox Co.&Knoxville 105) Savannah-Chatham Cc u nty School s 119) south Florida Transportation Authority 120) Tampa Bay Water Authority State Governmental Entities: 106) Ga.Envi ron.Fin.Auth.(GEFA) 107) Ga.Parts Authority Mauldin&Jenkins,LLC Page 11 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 14 AULMN ENKINS Orange County Quote to Provide Auditing Services Audits of Federally Funded Programs(Single Audit Relative to audits of calendar year 2017, Mauldin &Jenkins audits 170 entities representing approximately $1.8 billion in federal } expenditures for state, local government, and non-profit clients which is the: • 35" highest among public accounting firms in the nation as it relates to total expenditures audited under the Single Audit Act; a nd, • 191h highest among public accounting firms in the nation as it relates to number of Single Audits conducted. Mauldin and Jenkins serves a significant amount of clients who require substantial single audits. In January 2008, as part of the Federal Department of Education's random testing of the audits of local boards of education, a review was performed by the Federal Office of Inspector General (GIG) regarding a Single Audit engagement of a local board of education. We are quite pleased to note the examiner provided Mauldin & Jenkins a letter of high marks for the performance of the respective Single Audit and this comes at a time when Federal regulators are condemning the profession for poor performance of such Single Audits. Unofficially and orally provided, the examiner noted this Single Audit engagement to be the best such engagement reviewed in his experience. Mauldin&Jenkins,LCC Page 12 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 15 MAULDIN Quote to Provide Audifitig Services Additional Information of Value Added Services Free Continuing Education for Governmental Clients We provide free quarterly continuing education for all of our governmental clients. Each quarter, we pick a couple of significant topics tailored to be of interest to governmental entities, and offer the sessions several times per quarter at a variety of client provided locations resulting in greater networking among our governmental clients. We normally see approximately 100 people per quarter. We obtain the input and services of experienced outside speakers along with providing the instruction utilizing our in-house professionals. "I've been a CPA for 32 years. Today's CPE class by Mauldin&Jenkins has been the best of my career". Terry Nall,CPA,City of Dunwoody(GA) 04s Council Member"They are always on top of new accounting pronouncements and provide training well before implementation deadlines. This is a very valuable resource for our organization". Laurie Puckett, CPA, CPFO,Gwinnett ` County(GA),Accounting Director Examples of subjects addressed in the past few quarters include: • Accounting for Debt Issuances ■ Best Budgeting Practices, Policies and Processes • CAFR Preparation (several times including a two(2)day hands-0n course) • Capital Asset Accounting Processes and Controls • Col lateralization of Deposits and Investments • Evaluating Financial and Non-Financial Health of a Local Government • GASB No.51, Intangible Assets • GASB No.54, Governmental Fund Balance(subject addressed twice) ■ GASB No. 60, Service Concession Arrangements(webcast) ■ GASB No. 61,the Financial Reporting Entity(webcast) ■ GASB No.'s 63&65, Deferred Inflows and 0utflows(webcast) • GASB No.'s 67& 68, New Pension Standards (presented several occassions) • GASB No. 72, Fair Value Measurement and Application • GASB No. 77,Tax Abatement Disclosures • GASB Updates (ongoing and several sessions) • Grant Accounting Processes and Controls ■ Internal Controls Over Accounts Payable, Payroll and Cash ❑isbursements • Internal Controls over Receivables&the Revenue Cycle ■ Internal Revenue Service(IRS)Compliance Issues, Primarily Payroll Matters ■ Legal Considerations for Dent Issuances& Disclosure Requirements • Policies and Procedures Manuals • Segregation of Duties • Single Audits for Auditees ■ SPLOST Accounting, Reporting&Compliance • Uni€arm Grant Reporting Requirements and the New Single Audit Mauldin&Jenkins,LLC Page 13 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 16 AULDIN Provide81-IENKINS Orange County Quote to Governmental Newsletters We produce newsletters tailored to meet the needs of governments. The newsletters have addressed a variety of subjects and are intended ?• ::«>"`' to be timely in their subject matter. The newsletters are authored . � Mauldin & Jenkins partners and managers, and are not purchased from an outside agency. The newsletters are produced and delivered periodically, and are intended to keep you informed of current developments in the government finance environment. In the past several years, the following topics have been addressed in our monthly newsletters: • Accounting for Debt Issuances • American Recovery&Reinvestment Act (ARRA) Updates • Best Budgeting Practices, Policies and Processes • CAFR Preparation(several times including a two(2)day hands-on course) • Capital Asset Accounting Processes and Controls • Collateral ization of Deposits and Investments • Evaluating Financial and Non-Financial Health of a Local Government ■ GASB No.51, Intangible Assets • GASB No.54, Governmental Fund Balance(subject addressed twice) • GASB No.60, Service Concession Arrangements(webcast) • GASB No. 61,the Financial Reporting Entity(webcast) ■ GASB No.'s 63&65, Deferred Inflows and Outflows (webcast) ■ GASB No.'s 67&68, New Pension Stds. (presented several occasions) ■ GASB No. 72, Fair Value Measurement and Application • GASB No.'s 74&75,OPEB ■ GASB No.77,Tax Abatement Disclosures ■ GASB Updates(ongoing and several sessions) • Grant Accounting Processes and Controls • Internal Controls Over Accounts Payable, Payroll and Cash Disbursements • Internal Controls Over Receivables&the Revenue Cycle ■ Internal Revenue Service(IRS) Issues, Primarily Payroll Matters • Legal Considerations for Debt Issuances& ❑isclosure Requirements • Policies and Procedures Manuals • Segregation of Duties • Single Audits for Auditees the Uniform Guidance for New Single Audits • SPLOST Accounting, Reporting&Compliance Mauldin&Jenkins,LLC Page 14 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 17 MAULDrN Quote1 County rvices Auditor's Discussion &Analysis During the course of serving our clients, we stress , the importance of timely and frequent communication. Such communication takes place V Cf throughout the audit and throughout the year, and ■ �► includes proactive communications regarding new ■ — imp and upcoming accounting standards and auditing " {�� standards, as well as, the availability to answer questions and provide advice to the government. We believe such communication is a key to providing timely value-added service to our clients. At the conclusion of the audit process, Mauldin & Jenkins prepares an Auditor's Discussion & Analysis (formerly called the Audit Agenda) which provides auditor insight and summarizes the audit process, conclusions,and year end financial analysis all under one cover. Elements of the Auditor's Discussion &Analysis include the following: ■ Information about the Firm, and the respective personnel serving the government; • Results of the audit and other matters which should be emphasized to the governing board; • An overview of the governments year-end financial results and auditor insights relative to key financial elements of the government; • An understanding of the internal control / compliance audit reports and the results of our testing of internal controls and compliance with laws and regulations; • A summary of certain audit scopes and procedures utilized by Mauldin&Jenkins during the audit process; • Documentation of certain required communications as required by auditing standards; • If applicable, a summary of any findings (material weaknesses and / or significant deficiencies) and management recommendations resulting from the audit; ■ Practical information regarding upcoming new financial reporting and auditing standards and pronouncements affecting the government;and, • A summary of the free continuing education and newsletters made available to the government during the past year. Mauldin&Jenkins. LLC Page 15 DocuSign Envelope ID: FD83399B-C72A-42C4-A531-71667A72DBC7 18 AULDIN ENKINS Orange County Quote to Provide A udifin g Services Proposed Fees Mauldin &Jenkins, LLC is pleased to submit cost estimates to provide annual financial and compliance auditing services for the County. At the request of managmenet, we have prepred the following extension quotes for a three year extension. Fiscal year-end Not to Exceed June 30, 2019 $ 82,500 June 30, 2020 84,500 June 30, 2021 86,500 The above fees include the following considerations based on discussions with management: ■ The testing and reporting of six (6) major programs (mixed of federal and state funding) on an annual basis, in accordance with the Uniform Guidance and State Single Audit Implementation Act;and ■ The preparation of the County's Comprehensive Annual Financial Report; Closing We appreciate the opportunity to continue to build our relationshipo and serve Orange County. We believe Mauldin & Jenkins is the "right" Firm for the County. Our experience and knowledge in the governmental sector of accounting, is vast, unmatched, and ever-improving. We would be very pleased to continue to share our experience and understanding of governmental accounting and operations for the benefit of the County. We would greatly appreciate your recommending us for your audit, accounting, and financial reporting needs. Should you or anyone at the County have any questions with regards to this proposal or about Mauldin&Jenkins, please feel free to contact us. Mauldin&a Jenkins, LLC Page 16