HomeMy WebLinkAboutResolution - 5873 - Agreement - Robinson Burdetter Martin & Cowan LLP - Audit, Financial Statements - 05_28_1998Resolution No. 5873
Item No. 27
May 28, 1998
RESOLUTION
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
THAT the Mayor of the City of Lubbock BE and is hereby authorized and directed
to execute for and on behalf of the City of Lubbock an Agreement with Robinson Burdette
Martin & Cowan, L.L.P., for the audit of the City of Lubbock's general purpose financial
statements, attached hereto, which shall be spread upon the minutes of the Council and as
spread upon the minutes of this Council shall constitute and be a part of this Resolution as if
fully copied herein in detail.
Passed by the City Council this 28th day of May, 1998.
Viii *11, - Ki4 I.m.
_ATTEST:
Kayth' , amell, City Secretary
APPROVED AS TO CONTENT:
Anna Mosqueda,eAaging Director
of Financial Services
APPROVED AS TO FORM:
Aill/iam de Haas
Municipal Contracts Attorney
Resolution No.5873
Item No. 27
May 28, 1998
THE STATE OF TEXAS 8
AGREEMENT
COUNTY OF LUBBOCK 8
THIS AGREEMENT made and entered in this 28t' day of May, 1998, between
the CITY OF LUBBOCK, Lubbock County, Texas, hereinafter referred to as "CITY", and
ROBINSON BURDETTE MARTIN & COWAN, L.L.P., Lubbock, Texas hereinafter
referred to as "RBM&C".
WITNESSETH:
THAT for and in consideration of the mutual covenants and promises hereinafter
contained, it is agreed between the parties hereto as follows:
RBM&C will audit the CITY'S general purpose financial statements in accordance
with generally accepted accounting principles; generally accepted auditing standards
and 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; and the provisions of OMB Circular A-133, Audits of State and
Local Governments and Non -Profit Organizations. Those standards, circulars, or
supplements require that RBM&C plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. The objective of the audit is the expression
of an opinion concerning whether the financial statements present fairly, in all material
respects, the financial position of the City, and the results of its operations and cashflows
AGREEMENT -CITY & RBMC
Page 1
of its Proprietary Funds in conformity with generally accepted accounting principles.
RBMC will also issue a separate report on the City's Electric Enterprise Fund.
Said examination shall cover the fiscal year period from October 1, 1997 to
September 30, 1998. The auditing services shall be renewed annually for an additional
four (4) periods, as stated above, unless canceled by either party hereto. Fees for such
services are as referenced in Section XII. City may terminate contract (for any reason)
upon 120 days written notice to RBM&C.
Whenever notice from RBM&C to City or City to RBM&C is required or permitted
by this Agreement and no other method of notice is provided, such notice shall be given
by (1) actual delivery of the written notice to the other party by hand, (2) facsimile, or
other reasonable means (in which case such notice shall be effective upon delivery), or
(3) by depositing the written notice in the United States mail, properly addressed to the
other party at the address provided in this article, registered or certified mail, return
receipt requested, in which case such notice shall be effective on the third business day
after such notice is so deposited.
RBM&C's address and numbers for the purposes of notice are:
Attn: John W. Burdette
Robinson Burdette Martin & Cowan, L.L.P.
1500 Broadway, Suite 1300
Lubbock, Texas 79401
Telephone: (806) 744-3333
Facsimile: (806) 747-2106
The City's address and numbers for the purposes of notice are:
Attn: Anna Mosqueda
City of Lubbock
P.O. Box 2000
Lubbock, Texas 79457
AGREEMENT -CITY & RBMC
Page 2
Or physical address:
1625 13'" Street
Lubbock, Texas 79401
Telephone: (806) 775-2002
Facsimile: (806) 775-2051
Either party may change its address or numbers for purposes of notice by giving
written notice to the other party, referring specifically to this Agreement, and setting forth
such new address or numbers. The address or numbers shall become effective on the
15�h day after such notice is effective.
fiA
The audit is subject to the inherent risk that material errors, fraud, including
defalcations, if they exist, will not be detected. It is also subject to the inherent risk that
violations of the compliance requirements and other responsibilities imposed by state
and Federal statutes and regulations or assumed by contracts, if they exist, will not be
detected.
V.'
RBM&C'S report on internal control will include any reportable conditions and
material structural or operational weaknesses in the system of which RBM&C becomes
aware as a result of obtaining an understanding of internal control and performing tests
of internal control consistent with requirements of the standards and circular identified
above. RBM&C'S report on compliance will address errors, fraud, violations of
compliance requirements and other responsibilities imposed by state and Federal
statutes and regulations and assumed by contracts; and any state or Federal grant,
entitlement of loan program questioned costs of which RBM&C becomes aware,
consistent with requirements of the standards and circulars identified above.
AGREEMENT -CITY & RBMC
Page 3
Vi.
RBM&C shall make an immediate written report of all illegal acts or indications of
illegal acts of which they become aware to the Managing Director of Financial Services
for City of Lubbock.
RBM&C will notify City immediately if circumstances relating to the condition of
City records and/or the availability of sufficient competent evidential matter were to arise
during the course of RBM&C'S work which in RBM&C'S professional judgment prevents
them from completing the audit. In such a situation, RBM&C retain the unilateral right to
take any course of action permitted by professional standards, including withdrawal from
the engagement.
VII.
The City understands the financial statements and compliance matters are the
responsibility of the City's management. Management has the primary responsibility for
properly recording transactions in the records, for safeguarding assets, for preparing
reliable financial statements and for complying with statutory, regulatory and contractual
requirements. At the conclusion . of the audit, RBM&C will request certain written
representations from the City as to the fairness of the presentation of the financial
statements and all matters related thereto as well as compliance with Federal, state and
contractual requirements.
Vlll.
In addition to RBM&C'S reports on the City's financial statements, as specified by
OMB Circular A-133, RBM&C will also issue the following reports or types of reports as
specified in OMB Circular A-133:
• A report on the fairness of the presentation of the City's schedule of expenditures of
AGREEMENT -CITY & RBMC
Page 4
Federal awards.
• Reports on internal control related to the financial statements and major programs.
These reports will describe the scope of testing of internal control and the results of
RBM&C'S tests of internal controls.
• Reports on compliance with laws, regulations, and the provision of contracts or grant
agreements. RBM&C will report on any noncompliance, which could have a material
effect on the financial statements, and any noncompliance which could have a direct
and material effect on each major program.
• A schedule of findings and questioned costs.
IX.
The component units whose financial statements are to be combined with and
included as part of the City's general purpose financial statements are listed below:
City Transit Management, Inc. dba Citibus
Civic Lubbock, Inc.
Marketing Entertainment Travel Tourism and Sports, Inc.,
Market Lubbock Economic Development Corporation dba Market Lubbock, Inc.
RBM&C understands that these engagements will be engaged and billed separately and
are not considered to be covered by this agreement.
X.
The City intends to submit the Comprehensive Annual Financial Report (CAFR)
for evaluation by the Government Finance Officers Association's (GFOA) Certificate of
Achievement for Excellence in Financial Reporting program. RBM&C'S participation in
this process will consist of review of compliance of CAFR to GFOA checklist for CAFR
preparation and suggestions for responses or methods to address operations to address
the annual feedback comments offered by GFOA.
AGREEMENT -CITY & RBMC
Page 5
X!.
RBM&C will assist the City of Lubbock with submissions of Popular Annual
Financial Reports (PAFRs) to the GFOA PAFR program. RBM&C's participation will be
a review of compliance of PAFR to GFOA checklist for PAFR preparation and
suggestions to address annual feedback comments offered by GFOA.
F31�
The working papers for this engagement are the property of RBM&C. RBM&C
will be required to make working papers available upon request to CITY and to respond
to reasonable inquiries of successor auditors and to allow successor to review working
papers relating to matters of continuing audit significance. City also acknowledges and
grants assent that representatives of the cognizant or oversight agency or their
designee, other government audit staffs and the U.S. General Accounting Office shall
have access to the audit working papers upon their request; and that RBM&C shall
maintain the working papers for a period of at least three years after the date of the
report, or for a longer period if RBM&C is requested to do so by the cognizant or
oversight agency.
During the course of RBM&C'S engagement, RBM&C may accumulate records
containing data which should be reflected in the City's books and records. City will
determine that all such data, if necessary, will be so reflected. Accordingly, City will not
expect RBM&C to maintain copies of such records in RBM&C'S possession.
M
The assistance to be supplied by City personnel, including the preparation of
schedules and analyses of accounts, will be discussed and coordinated with the Finance
Manager and/or Chief Accountant. The timely completion of this work will assist RBM&C
in performing the work efficiently. Accounting records will be ready for audit on agreed
AGREEMENT -CITY & RBMC
Page 6
upon start date.
RBM&C'S fees are based on these time estimates:
Fiscal Year
Total Budgeted Hours
Rate per Hour
1997-1998
1,350
$66.00
1998-1999
1,350
1998 rate, as adjusted
1999-2000
1,350
1999 rate, as adjusted
2000-2001
1,350
1 2000 rate, as adjusted
2001-2002
1,350
1 2001 rate, as adjusted
For the fiscal years beginning 1998-1999 and thereafter, hourly fees shall be
adjusted by the Consumer Price Index for All Urban Consumers (CPI-U), U.S. City
Average as published in the November -December issue of the Southwest Statistical
Summary for Region 6 (Source: Bureau of Labor Statistics) under the U.S. City Average:
12 Month Percent change for All Items.
Interim billings will be submitted as work progresses. RBM&C'S fee for the
services described in this letter will not exceed the budgeted hours or adjusted hourly
rate unless the scope of the engagement is changed, the assistance which the City has
agreed to furnish is not provided, or unexpected conditions are encountered. In all
cases RBM&C will provide written notification including amount of increase and
justification to Managing Director of Financial Services, before proceeding. All other
provisions of this letter will survive any fee adjustment.
XIV.
In the event RBM&C are requested or authorized by City of Lubbock, Lubbock,
Texas or are required by government regulation, subpoena, or other legal process to
produce RBM&C'S documents or RBM&C'S personnel as witnesses with respect to
RBM&C'S engagements for City of Lubbock, Lubbock, Texas, City of Lubbock, Lubbock,
Texas will, so long as RBM&C are not a party to the proceeding in which the information
is sought, reimburse for RBM&C'S professional expenses, as well as reasonable fees
and expenses of RBM&C'S counsel, incurred in responding to such requests.
AGREEMENT -CITY & RBMC
Page 7
XV.
It is agreed by City of Lubbock, Lubbock, Texas and Robinson Burdette
Martin & Cowan, L.L.P. or any successors in interest that no claim by or on behalf of
either party arising out of services rendered pursuant to this agreement shall be asserted
more than three years after the date of the audit report or one year after the date of
termination of Robinson Burdette Martin & Cowan, L.L.P.'s services.
F.'M
RBM&C will work with the City to implement a continuous audit approach.
The City anticipates that these procedures will be developed in Fiscal Year 1997-98.
Beginning in 1998-99, the audit shall be performed in quarterly intervals.
The timeline of required schedules and audit work shall be jointly agreed -upon prior to
the beginning of the fiscal year for which the audit is scheduled.
This Agreement shall be governed by and construed in accordance with the
laws of the State of Texas. The parties hereto hereby irrevocably consent to the
exclusive jurisdiction and venue of the courts of the State of Texas, County of Lubbock,
for the purposes of all legal proceedings arising out of or relating to this Agreement or
the actions that are contemplated hereby.
1_,'QII�
RBM&C shall maintain records that are necessary to substantiate the
services provided by RBM&C and make these records available upon request to the City
of Lubbock.
AGREEMENT -CITY & RBMC
Page 8
of the City.
XIX.
RBM&C may not assign this Agreement without the prior written approval
XX.
This Agreement binds and inures to the benefit of the City, RBM&C, and
their respective successors, legal representatives, and assigns.
XXI.
If any provision of this Agreement is ever held to be invalid or ineffective by
any court of competent jurisdiction with respect to any person or circumstances, the
remainder of this Agreement and the application of such provision to persons and/or
circumstances other than those with respect to which it is held invalid or ineffective shall
not be affected thereby.
XXI1.
No amendment, modification, or alteration of the terms cf this Agreement
shall be binding unless such amendment, modification, or alteration is in writing, dated
subsequent to this Agreement, and duly executed by RBM&C and City.
XXIII.
This Agreement contains the Entire Agreement between RBM&C and the
City, and there are no other written or oral promises, conditions, warranties, or
representations relating to or affecting the matters contemplated herein.
AGREEMENT -CITY & RBMC
Page 9
CITY OF LUBBOCK
r.�
ATTEST:
Ka Dame I, City ecret
APPR VED AS TO CONTENT:
aMVojiq-u'eda, D' ctor of Financial
Services
APPROVED AS TO FORM:
Ax'a� '(Z Z&�--z
William de Haas
Municipal Contracts Attorney
AGREEMENT -CITY & RBM[C
Page 10
ROBINSON BURDETTE MARTIN &
COWAN L.L.P.
BY: —Jfw I r, /�� -�—
JOHN BURDETTE, PARTNER
WITNESSED BY:
Ben F. Robinson, Partner