HomeMy WebLinkAboutContract 35777Deloitte
August 13, 2007
Joe Paniagua
Assistant City Manager
City of Fort Worth
1000 Throckmorton
Fort Worth, Texas 76102
Dear Mr. Paniagua:
c�rY s�cREr��� � �J
COIVTRAG7' �. `���%rI /
Deloitte & Touche LLP
Suite 1501
201 Main Street
Fort Worth, TX 76102-3119
USA
Tel: +1 817 347 3300
Fax: +1 817 336 2013
www.deloitte.com
This letter coniirms the engagement of Deloitte & Touche LLP ("D&T") to perform certain
agreed-upon procedures to assist the City of Fort Worth (the "City") in connection with an
evaluation of certain programs of the Fort Worth Crime Control and Prevention District (the
"CCPD").
This engagement to perform agreed-upon procedures will be conducted in accordance with
attestation standards established by the American Institute of Certified Public Accountants,
subject to the terms and conditions set forth herein. The specific procedures that D&T is to
perform are set forth in the accompanying Appendix A. These procedures have been established
based on discussions with you, arid the sufficiency of the procedures is solely the responsibility of
the CCPD, as discussed below. In addition, these procedures may be changed or modified by
mutual agreement between the City, on behalf of the CCPD, and D&T if, for example, unforeseen
circumstances arise. D&T will promptly discuss any such circumstances with the CCPD and,
likewise, the CCPD agrees to promptly notify D&T if modifications to the procedures are
requested.
ACKNOWLEDGEMENTS AND AGREEMENTS
The CCPD and the City specifically acknowledges and agrees to the following:
• The performance of the agreed-upon procedures will not constitute an audit conducted in
accordance with generally accepted auditing standards, the objective of which is the
expression of an opinion on the CCPD's or the City's financial statements. Therefore,
D&T will not be in a position to express, and will not express, an opinion or any other
form of assurance with respect to any matters as a result of perfornung the agreed-upon
procedures.
• The agreed-upon procedures that D&T is to perform at the request of the CCPD, and with
the agreement of D&T, are limited in nature and do not comprehend all matters that
might be pertinent or necessary to the CCPD's evaluation of the CCPD programs.
Accordingly, the procedures should not be taken to supplant other inquiries and
procedures that the CCPD should undertake far the purpose described above. � "� �,1 ;�.!'�,,^,;��r;, ��
' '.r.�i'.:�1�;!� ,'`•'��lJ.� _
�1��' �'s���� �
-''� :ti�";�`�;�, i ;
. . ,�:�.�ii� �I��,{.,
-�..�. � - -- _ €
Member of
Deloitte Touche Tohmatsu
• D&T's report will not extend to any financial statements of the CCPD or the City, taken
as a whole, or its internal control for any date or period.
• The nature, scope, and design of the agreed-upon procedures that D&T is requested to
perform are solely the responsibility of the CCPD. Furthermore, D&T has no
responsibility to advise the CCPD of other procedures that might be performed and
makes no representations as to the sufficiency of such procedures for the purposes of the
CCPD.
• D&T's responsibility is limited to perfornung the procedures speciiied and agreed to, and
to reporting the resulting fmdings, subj ect to the limitations contained herein, and D&T's
engagement cannot be relied on to disclose significant deficiencies, material weaknesses,
or fraud should they exist. In addition, D&T's engagement cannot be relied on to
disclose errors, other than those errors that may be reported as fmdings in connection
with the application of the agreed-upon procedures that D&T is to perform hereunder.
D&T has no responsibility for updating the procedures performed or for performing any
additional procedures.
• The City, on behalf of the CCPD, shall be solely responsible for the design and operation
of effective internal control and for complying with all applicable laws and regulations.
• The City, on behalf of the CCPD, shall be solely responsible for providing accurate and
complete information requested by D&T. D&T has no responsibility for the accuracy or
completeness of the information provided by or on behalf of the City, on behalf of the
CCPD.
• Immediately prior to the completion of this engagement, D&T will request that the City's
management, on behalf of the CCPD's management, provide D&T with a representation
letter acknowledging management's responsibility for the information provided to us and
confirnung certain representations made to D&T during the engagement.
• Should D&T determine that significant restrictions are being placed on the performance
of the agreed-upon procedures by the CCPD, including, without limitation, the failure of
management to provide D&T with a management representation letter that D&T
deternlines to be satisfactory, D&T shall be entitled to withdraw from this engagement.
• To the extent allowed by law, any report issued by D&T hereunder will not be used by or
circulated, quoted, disclosed or distributed to, nor will reference to such report or D&T's
engagement hereunder be made to, anyone who is not a member of management or the
board of directors of the CCPD, or management or the City Council of the City of Fort
Worth.
FEES
Our fees for these services are based on the amount of time required at various levels of
responsibility. We estimate that our total fees for the performance of these procedures will be
$25,000. We will perform these procedures at a rate of $155 per hour. Only that portion of those
procedures described in Appendix A that may be completed within this fee will be completed and
reported upon. We will perform the procedures in the order that they appear in Appendix A and
will cease the performance of further procedures when we have reached the designated total fee
goal. Should any additional procedures then be desired by the CCPD Board we will discuss those
2
fees with you at that time. NOT ALL PROCEDURES LISTED IN APPENDIX A WII,L BE
COMPLETED.
This engagement letter, including the appendices attached hereto and made a part hereof,
constitutes the entire agreement between the parties with respect to this engagement and
supersedes all other prior and contemporaneous agreements or understandings between the
parties, whether written or oral, relating to this engagement.
If the above terms are acceptable to you and the services described are in accordance with your
understanding, please sign the copy of this engagement letter in the space provided and return it
to us.
Yours truly,
!7 � T�-�. � � p
Acknowledged and approved on behalf of
THE CITY OF
:
Title: ��rS51S j�;-,��5 ���'�''1 i�'1/�,�� C, ��
Date: `'-� � � �' _ O
�,���i���� �� ��
���� ��� �..��,��...��i_
i �� ��.,./ , - ,� -
�� �` � �A�SI�iANiG� Y ATT�RN�Y
'��....4 �... �
11�' \ ^
I I \
....�! . . . .
� a
-�::��1i:.�=��c:t: �ut� ox�iz�tio� - _-
'71�-
t., �-, t �, -�-- -
� 17�.' 1^l`) i 1^�
� � � / � IC ��'^ !� �f /�
' - r ,'�:� � 1 t:s:::��J� c
� �� � ,,
.���'�'� �1�, ���5 �� �
� �,�;5�
-r , •.,, -,� j� `
� - ':'� „ ' ��'i'
Il� � U ��!,i1,
r
_.�, F
GENERAL BUSINESS TERMS
Limitation on Liabilitv. Release and Indemnification.
a) The Fort Worth Crime Control and Prevention District and the City of Fort Worth (the "ClienY') agrees that D&T
and its personnel will not be liable to the Client for any claims, liabilities, or expenses relating to this engagement for
an aggregate amount in excess of the fees paid by the Client to D&T pursuant to this engagement, except to the
extent finally judicially determined to have resulted primarily from the bad faith or intentional misconduct of D&T. In
no event will D&T or its personnel be liable for consequential, special, indirect, incidental, punitive or exemplary
loss, damage, or expense relating to this engagement.
b) To the extent allowed by law, the Client agrees to release and indemnify D&T and its personnel from all claims,
liabilities, and expenses relating to this engagement attributable to any misrepresentation by the ClienYs
management.
c) To the extent allowed by law, the Client agrees to indemnify and hold harmless D&T and its personnel from all
claims, liabilities, and expenses relating to this engagement, except to the extent finally judicially determined to
have resulted primarily from the bad faith or intentional misconduct of D&T.
d) The provisions of this Paragraph 1 will apply to the fullest extent of the law, whether in contract, statute, tort
(such as negligence), or othervvise. In circumstances where all or any portion of the provisions of this Paragraph 1
are finally judicially determined to be unavailable, D&T's aggregate liability for any claims, liabilities, or expenses
relating to this engagement shall not exceed an amount that is proportional to the relative fault that D&T's conduct
bears to all other conduct giving rise to such claims, liabilities, or expenses.
Independent Contractor. It is understood and agreed that each of the parties hereto is an independent contractor
and that neither party is, nor will be considered to be, an agent, partner, fiduciary, or representative of the other.
Survival and Interpretation. The agreements and undertakings of the Client contained in the engagement letter to
which these terms are attached (the "engagement letter'), together with the appendix to the engagement letter and
these terms, will survive the completion or termination of this engagement. For purposes of the provisions in the
"Acknowledgments and Agreements" section of the engagement letter and these terms, "D&T" shall mean Deloitte
& Touche LLP and its subsidiaries; to the extent providing services under the engagement letter, Deloitte Touche
Tohmatsu, its member firms, and the affiliates of Deloitte & Touche L�P, Deloitte Touche Tohmatsu and its member
firms; all of their partners, principals, members, owners, directors, staff, and agents; and in all cases any successor
or assignee.
Assiqnment. Except as provided below, neither party may assign, transfer, or delegate any of its rights or
obligations hereunder (including, without limitation, interests or claims relating to this engagement) without the prior
written consent of the other party. D&T may, without the consent of the Client or any other party, assign or
subcontract its rights and obligations hereunder to any affiliate or related entity.
Dispute Resolution. Any controversy or claim between the parties arising out of or relating to the engagement
letter, including its appendices, or this engagement (a "Dispute") shall be resolved by mediation or binding
arbitration as set forth in the Dispute Resolution Provision attached hereto as Appendix B and made a part hereof.
APPENDIX A
AGREED-UPON PROCEDURES
THE FORT WORTH CRIME CONTROL AND PREVENTION DISTRICT
MAY 10, 2007
Agreed-Upon procedures to be performed for the year ended September 30, 2006 (subject to the
limitations described in the fee section above):
1. Gang Graffiti Abatement — Major program components include 2 civilian staff,
supplies, contractual services
a. We will obtain a listing of all graffiti abatement contractor invoices for the
year and randomly select 10% of them(approximately 200 invoices), upon
which the following procedures will be performed:
i. Compare addresses to Tarrant Appraisal District records to verify
that the addresses are either commercial or private property.
ii. Determine whether compliance documentation was provided with
the invoice (i.e. before and after pictures).
iii. Compare the paytnent amount on the listing to the invoice amount.
2. Expanded Narcotics - Major program components include staffing, miscellaneous
supplies, and vehicle leases, all used in support of investigations of complaints of
drug houses.
a. Using cost center records we will compile a roster of employees actually
charged to the cost center and will compare the total amount of employee
costs to the amount originally budgeted for the program according to the
adopted CCPD budget documentation.
3. Code: Blue — Major program components include temporary labor, supplies and
fuel reimbursement.
a. We will randomly select two months for testing.
b. For the selected months, we will request a list of mileage reimbursement
requests funded by the CCPD and will compare those requests to the
request forms submitted by participating officers.
c. Expenditures for the Code Blue banquet will also be examined to
determine compliance with the City's purchasing regulations and
procedures and adherence to budget.
4. Special Events Overtime - Major program components include civil service
overtime and associated costs.
a. For the month of Apri12005 we will obtain a list of all officer overtime
charges funded by the CCPD in this area.
b. We will compare the overtime charges on this list for Texas Motor
Speedway traffic and security functions to the supplemental compensation
forms filed by the officers.
5. Homeland Security — Major program components include staffing, equipment and
supplies for the Intel Unit.
a. Using cost center records we will compile a roster of employees actually
charged to the cost center and will compare the total amount of employee
5
costs to the amount originally budgeted for the program according to the
adopted CCPD budget documentation.
6. School Security Initiative — Major program components include staffing, supplies
and vehicles costs necessary to provide officers in 8 school districts operating in
Fort Worth.
a. We will randomly select 10% of the quarterly charges paid to a118 school
districts and compare them to supporting documentation provided by the
school districts when billed.
7. Weapons — Major program components include purchase agreement for weapons
a. We will read the authorization for the purchase of weapons with CCPD
funds as documented in CCPD Board minutes and City Council minutes
and compare to the purchase order, invoicing and receipt documentation
for the purchase.
8. Vehicles - Major program components include purchase agreements for
replacement vehicles
a. We will read the authorization for the purchase of vehicles with CCPD
funds as documented in CCPD Board minutes and Fort Worth City
Council minutes and compare to the purchase order, invoicing and receipt
documentation for the purchase.
b. We will verify the deposit of proceeds recovered from private insurance
carriers through or by subrogation by the Risk Management Division of
the Finance Department, required for all Police Department vehicles,
purchased by the CCPD, totaled as a result of a third-party. We will
compare the quarterly recovery reports prepared by the Risk Management
Division to Police Department records to determine whether all vehicles
totaled by a third-party are accounted for. We will determine whether all
insurance monies owed to the District are accurately transferred and
appropriated into the CCPD from the Risk Management Fund in
accordance with the annual supplemental appropriation as authorized by
the City Council (M&C).
***
�
APPENDIX B
DISPUTE RESOLUTION PROVISION
FORT WORTH CRIME CONTROL AND PREVENTION DISTRICT
MAY 10, 2007
This Dispute Resolution Provision sets forth the dispute resolution process and procedures
applicable to the resolution of Disputes and shall apply to the fullest extent of the law, whether in
contract, statute, tort (such as negligence), or otherwise.
Mediation: All Disputes shall be first submitted to nonbinding confidential mediation by written
notice to the parties, and shall be treated as compromise and settlement negotiations under the
standards set forth in the Federal Rules of Evidence and all applicable state counterparts, together
with any applicable statutes protecting the conf'identiality of inediations or settlement discussions.
If the parties cannot agree on a mediator, the International Institute for Conflict Prevention and
Resolution ("CPR"), at the written request of a party, shall designate a mediator.
Arbitration Procedures: If a Dispute has not been resolved within 90 days after the effective date
of the written notice beginning the mediation process (or such longer period, if the parties so
agree in writing), the mediation shall ternunate and the Dispute shall be settled by binding
arbitration to be held in New York, New York. The arbitration shall be solely between the parties
and shall be conducted in accordance with the CPR Rules for Non-Administered Arbitration that
are in effect at the time of the commencement of the arbitration, except to the extent modiiied by
this Dispute Resolution Provision (the "Rules").
The arbitration shall be conducted before a panel of three arbitrators. Each of the Company and
Deloitte & Touche LLP shall designate one arbitrator in accordance with the "screened"
appointment procedure provided in the Rules and the two party-designated arbitrators shall jointly
select the third in accordance with the Rules. No arbitrator may serve on the panel unless he or
she has agreed in writing to enforce the terms of the engagement letter (including its appendices)
to which this Dispute Resolution Provision is attached and to abide by the terms of this Dispute
Resolution Provision. Except with respect to the interpretation and enforcement of these
arbitration procedures (which shall be governed by the Federal Arbitration Act), the arbitrators
shall apply the laws of the State of New York (without giving effect to its choice of law
principles) in connection with the Dispute. The arbitrators shall have no power to award punitive,
exemplary or other damages not based on a party's actual damages (and the parties expressly
waive their right to receive such damages). The arbitrators may render a summary disposition
relative to all or some of the issues, provided that the responding party has had an adequate
opportunity to respond to any such application for such disposition. No discovery shall be
permitted in connection with the arbitration, except to the extent that it is expressly authorized by
the arbitrators upon a showing of substantial need by the party seeking discovery. All aspects of
the arbitration shall be treated as conf'idential, as provided in the Rules. Before making any
disclosure permitted by the Rules, a party shall give written notice to all other parties and afford
such parties a reasonable opportunity to protect their interests. Further, judgment on the
arbitrators' award may be entered in any court having jurisdiction.
Costs: Each party shall bear its own costs in both the mediation and the arbitration; however, the
parties shall share the fees and expenses of both the mediators and the arbitrators equally.
7
Page 1 of 2
City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 7/10/2007
DATE: Tuesday, July 10, 2007
LOG NAME: 35CCPDAUDIT
REFERENCE NO.: C-22244
SUBJECT:
Authorize Execution of an Agreement for Professional Services with Deloitte & Touche, LLP, for
Audit Services Requested by the Crime Control and Prevention District Board
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize the City Manager to execute an Agreement For Professional Services with Deloitte & Touche,
LLP, for an audit of select Crime Control and Prevention District programs operated for the fiscal year
ending September 30, 2005; and
2. Authorize payments not to exceed $25,000 to Deloitte & Touche, LLP, for certain agreed upon
procedures performed relative to this audit.
DISCUSSION:
The purpose of this Mayor and Council Communication is to authorize execution of an Agreement for
Professional Services for independent audit services to be provided by the external auditor, Deloitte &
Touche, LLP, for the fiscal year ending September 30, 2005.
On December 12, 2006, (M&C G-15528) the City Council approved a mid-year amendment, inclusive of
funds for a Crime Control and Prevention District (CCPD) program audit. On February 15, 2007, the CCPD
Board established a list of agreed upon procedures. On June 7, 2007, the audit scope and priorities were
finalized by the CCPD Board with the following programs identified for review: Gang Graffiti Abatement,
Expanded Narcotics, Code: Blue, Special Events Overtime, Homeland Security, School Security Initiative,
Weapons and Vehicles.
The CCPD Board has requested this audit and wants to have the results of the audit to review and consider
as part of its fiduciary responsibility over the fund.
FISCAL INFORMATION/CERTIFICATION:
The Finance Director certifies that funds are available in the current operating budget, as appropriated, of
the Crime Control and Prevention District Fund.
TO Fund/AccountlCenters FROM Fund/Account/Centers
http://www.cfwnet.org/council�acket/Reports/mc�rint.asp 9/11/2007
Submitted for City Manager's Office bv:
Originating Department Head:
Additional Information Contact:
GR79 539120 0351000
Joe Paniagua (6191)
Ralph Mendoza (4210)
Kara Shuror (4221)
Page 2 of 2
$25,000.00
http://www.cfwnet.org/council�acket/Reports/mc�rint.asp 9/ll /2007