Res 171-83 9/6/1983RESOLUTION NO. 171-83
RESOLUTION APPROVING AND AUTHORIZING THE CITY
MANAGER TO EXECUTE A CONTRACT FOR THE INDEPEN-
DENT AUDIT OF THE CITY OF WICHITA FALLS, TEXAS .
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WICHITA
FALLS, TEXAS, THAT:
That certain contract, a copy of which is attached hereto,
between the City of Wichita Falls and Hupp, Thompson; Crain, Hardon
and Bayer for the independent audit of the City of Wichita
Falls for a three year period, is hereby approved, and the City
Manager is authorized to execute the same for the City of Wichita
Falls .
PASSED AND APPROVED this the 6th day of September, 1983 .
A Y O ••
ATTEST:
c- -1 t-4L4' ',1% mot`s L.4
City Clerk
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I. NAME OF CONTRACTING PARTIES Page 1
This Contract entered into on 19 ` between the City of Wichita
U
K Falls, State of Texas , herafter called the City and Outside
Auditor, hereafter called the Auditor. The parties hereto agree as follows:
III. NAMED INDIVIDUALS
U A. Assignment of Named Individuals
The Auditor shall assign the following individuals to the project described in
this Contract on a full-time basis and in the capacities set forth below:
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Project Manager:
Project Staff:
Resumes of these individuals are attached .
1 B. Changes in Staff
I
The City has the right to approve or disapprove any proposed changes in the
U Auditor's staff from the individuals named in Article II A. The City shall beu
provided with a resume of any proposed substitute and shall be given the
opportunity to interview that person prior to its decision to approve or
disapprove of his/her assignment to the City audit.
i Qualificatioos of replacemeot yeraoonel munt meet oc eozeed dzooe of dze ntoff
members whom they intend to replace.
I III. SCOPE OF WORK
A. Audit Scope
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The examination shall be made of all funds and account groups of the City
of Wichita Falls, Texas which the City has direct or maintenance respons-
ibility including the appropriate NGGA statements and interpretations as
applicable.
B. Audit Survey
LIPrior to performing the audit , the Auditor shall survey the City 's accounting
system to facilitate preparing a detailed audit program.
Page 3 of 12 Pages
Agenda Item ---- 15 .j .
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C. Audit Standards Page 2
11
The examination shall be made in accordance with generally accepted auditing
standards (GAAS) as prescribed by the American Institute of Certified Public
Accountants (AICPA) and in accordance with the General Accounting Officer =^
GAO) and Attachment "P" of OMB Circular No. A-102'
D. Auditing Procedures
ElTheexaminationshallbemadeinaccordancewithgenerallyacceptedauditing
procedures as prescribed by the National Council on Governmental Accounting
NCGA) and by the American Institute of Certified Public Accountants (AICPA),
and statements of auditing standards shall be adhered to and performed accord— C:
iogly by the selected audit firm soley by the firms staff and its personnel
inclusive within the scope of the audit time; this includes workpaper prepara-
kptiouandsampleselection.
D. Audit program Review
The Auditor shall review its -written audit program with the City so that a
thorough audit will be performed, identifying the follmwiug;
1) the plan for testing records and procedures , using statistical sampling
and computer auditing where appropriate
2) the method for evaluating internal control i
3) the audit procedures to be taken
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4) the extent operational audit procedures.
ilF. Statements and Records To Be Provided by Local Government
1. The City shall have closed and balanced all accounts by fund for all ii
tuuds to 6e examioed by the Aoditor, ufter nu6miosioo ot recommended
audit adjustments by fund from the Auditor. Closing is a computerized
close out in the accounting system.
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1Page4of12Pages.s
Agenda Item No . 15 . ' .
6.
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G. Certiiidateof Conformance Page 3
The Auditor' s staff shall develop additional financial and statistical
information, not subject to examination by the Auditor, but necessary to
substantially conform to the principles and standards of public financial
reporting prescribed by the Municipal Finance Officers Association (MFOA) and
the National Council on Governmental Accounting (NCGA) .
H. Management Letter
The Auditor shall observe the adequacy of the system of internal control . If
weaknesses are noted, appropriate recommendations should first be reviewed
with the appropriate public official and then included in a separate
management letter issued to the City Manager and City Council for their
internal use only.
I . Disclosure of Irregularities
The City authorizes the Audit to disclose immediately all findings of
suspected fraud or embezzlement to the appropriate law enforcement agency.
J. Unqualified Opinion
The Auditor shall express an unqualified opinion on the financial statements
of all funds and account groups. If unable to express an unqualified opinion,
the Auditor should state the reasons for qualification, disclaimer, or adverse
opinion.
K. Audit Report
The Audit shall provide 100 copies of the audit report which should _be printed
on regular letter-size (8 1/2" x 11") paper, using both sides of the paper
whenever possible. Fold out sheets will not be acceptable nor will split
sheets be acceptable.
The report shall be made to the Mayor and City Council by sending copies to
them at the City Hall.
The report shall be delivered no later than January 15, 1983.
IV. WORK SCHEDULE
The Auditor shall conduct an examination of the records , accounts , and procedures
of the City for the fiscal period 1983, 1984, and 1985. The audit for fiscal
period 1983 should begin on or about September 13, 1983 and end January 15 , 1984
Extensions for the time of completion may be allowed for good cause by the City
Council.
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V. COMPENSATION AND TERMS OF CONTRACT Page 4
1]
A. The City shall pay the Audit at the average hourly rate of $ for
services rendered. The total payment to the Auditor shall not exceed $
for the period with maximum annual payments as follows: t.t
Fiscal Year Maximum Payment
19
19
19
Total
1B. Periodic billings shall be submitted as work progresses, but not more often
than monthly. The auditor shall submit hours worked by staff level , ie:
partner, senior, junior, etc. and hours by categorical summary, ie: planning
audit,' evaluation of internal control.
C. City participation beyond those addressed in Section VI will result in reduc- Fl
tion in billings at average hourly rate in Section V at City's option.
1VI. LIMIT OF SERVICE FURNISHED TO THE AUDITOR
The City's Department of Accounting/Finance will address questions pertaining to Ll
accounting/audit procedures as addressed through the Chief Accounting Officer.
The City will provide location and filing sequence information for all permanent ,
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records for audit sampling by the audit firm. All computer printed information
will be made available for use by the audit firm. The City staff will provide ''
account analysis' from the existing transaction history files for any and all
accounts selected for inquiry by the audit firm in the form of computer printout
analysis.
The City Attorney's staff will be available to provide legal counsel pertinent to
the annual audit. r`.
The separate work space for three-five people will he made available for the City
auditor's in close proximity to accounting records . Additional space can be
provided as needed.
Page 6 of 12 Pages.
Agenda Item No. 15 .j .
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C. Certificate of Conformance Page 3
The Auditor's staff shall develop additional financial and statistical
information, not subject to examination by the Auditor, but necessary to
substantially conform to the principles and standards of public financial
reporting prescribed by the Municipal Finance Officers Association (MFOA) and
the National Council on Governmental Accounting (NCGA).
B. Management Letter
U
The Auditor shall observe the adequacy of the system of internal control. If
weaknesses are noted, appropriate recommendations should first be reviewed
i with the appropriate public official and then included in a separate
management letter issued to the City Manager and City Council for their
internal use only.
I . Disclosure of Irregularities
The City authorizes the Audit to disclose immediately all findings of
uayected fraud or embezzlement to the appropriate law enforcement agency.
J. Unqualified Opinion
The Auditor shall express an unqualified opinion on the financial statements
of all funds and account groups . If unable to express an unqualified opinion,
the Auditor should state the reasons for qualification, disclaimer, or adverse
opinion.
jK' Audit Deport
The Audit shall provide 100 copies of the audit report which should be printed
I on regular letter-size (8 1/2" x 11") paper, using both sides of the paper
whenever possible. Fold out sheets will not be acceptable nor will split
sheets be acceptable.
The report shall be made to the Mayor and City Council by sending copies to
them at the City Hall.
i
Ibe report shall be delivered no later than January 15, 1983'
IV. WORK SCHEDULE
The Auditor shall conduct an examination of the records , accounts , and procedures
of the City for the fiscal period L9 , l9___/ and l9____' The audit for fiscal
8 period 19 should begin on or about and end Extensions
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for the time of completion may be allowed for good cause by the City Council.
Page 5 of 12 Pages
Agenda Item No . . lS . ' '
to VII, ' TERMfNATION OF DIE CONTRACT Page 5
A. For Cause
If, through any cause, the Auditor shall fail to fulfill in timely and proper
Imauner the obligationo under chin Contract . thc City rhall huve thc rigbt to
terminate this Contract by specifying the date of termination in written
notice to the Auditor at least 30 working days before the termination date or
at City's option adjust billings as discussed in Section V.C. In this evpnt ,
the Auditor shall be entitled to just and equitable compensation for any out-
71 isfactory work completed.
B. Termination by Either Party
This Contract may be terminated by either party by giving written notice to
r the other party no later then 60 working days before the termination date.
In this event, the Auditor shall be entitled to just and equitable compeuoa-
tioo for any satisfactory work completed.
CONFLICT OF INTEREST
o -elected official or employee of the City who exercises any responsibilities in
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the review, approval, or carrying out of this Contract shall participate in any
decision relating to this Contract which affects his or her direct or indirect
personal or financial interest.
IX. COMPLETENESS OF THE CONTRACT
This document contains all terms and conditions of this Contract, and any
alteration shall be invalid unless made in writing, signed by both parties, and
incorporated as an amendment to this Contract . There are no understandings,
representations, or agreements , written or oral , other than those incorporated
herein.1
IN WITNESS WHEREOF, the parties have signed this Contract as of the day and year
k first above written.
City of Wichita Falls
By: Mayor
By: City Manager
c,.Auditor ATTEST:
By: City Clerk
Title:
Page 7 of 12 Pages
U Agenda Item No. 15 ' ' ,