HomeMy WebLinkAboutContract 39383 RETARY
Deloitte.
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
September 24, 2009
City of Fort Worth
Ms. Karen L. Montgomery
1000 Throckmorton
Fort Worth, Texas
Dear Ms. Montgomery:
This letter confirms the engagement of Deloitte & Touche LLP ("D&T" or "we" or"us")
to perform certain agreed-upon procedures to assist the City of Fort Worth (the "City") in
its evaluation of its compliance with the local government financial test requirements
under Texas Administrative Code Title 30, Chapter 37, Rule 37.271 ("TAC 30, Chapter
37, section 37.271"), for the year ended September 30, 2008.
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, and the sufficiency of
the procedures is solely the responsibility of the City, as discussed below. In addition,
these procedures may be changed or modified by mutual agreement between the City and
D&T if, for example, unforeseen circumstances arise. D&T will promptly discuss any
such circumstances with the City and, likewise, the City agrees to promptly notify D&T
if modifications to the procedures are requested.
Acknowledgments and Agreements
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 elements, accounts, or items of a
financial statement. 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
(including, without limitation,the City's compliance local government financial
test requirements under TAC 30, Chapter 37, section 37.271 for the year ended
September 30, 2008 as a result of performing the agreed-upon procedures.
• The agreed-upon procedures that D&T is to perform at the request of the City,
and with the agreement of D&T, are limited in nature and do not comprehend all
�. ,. TX
Member of
Deloitte'1'duc a ohmatsu
matters relating to the data reported to the Texas Commission on Environmental
Quality that might be pertinent or necessary to the City's evaluation of its
compliance with the related standards established under TAC 30, Chapter 37,
section 37.271. Accordingly, the procedures should not be taken to supplant other
inquiries and procedures that the City should undertake for the purpose described
above.
• D&T's report will not extend to any financial statements of 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 City. Furthermore, D&T
has no responsibility to advise the City of other procedures that might be
performed and makes no representations as to the sufficiency of such procedures
for the purposes of the City.
• D&T's responsibility is limited to performing the procedures specified and agreed
to, and to reporting the resulting findings, subject 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 findings 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 shall be solely responsible for the design and operation of effective
internal control (including, without limitation, effective internal control over
compliance with the local government financial test requirements under TAC 30,
Chapter 37, section 37.271) for the year ended September 30, 2008 and for
complying with all applicable laws and regulations.
• The City 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.
• Immediately prior to the completion of this engagement, D&T will request that
City management provide D&T with a representation letter acknowledging
management's responsibility for compliance with the local government financial
test requirements under TAC 30, Chapter 37, section 37.271 and confirming
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 City, including, without
limitation,the failure of management to provide D&T with a management
representation letter that D&T determines to be satisfactory, D&T shall be entitled
to withdraw from this engagement.
y:
2
• 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 City
Council or the Texas Commission on Environmental Quality.
FEES
We estimate that our total fees for these agreed-upon procedures will be $3,000. If
significant additional procedures are anticipated, we will contact you before we incur the
additional costs.
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.
ACCEPTED AND AGREED TO BY THE
CITY OF FORT WORTH:
By: Attested by:
Karen L. Montgomery
Title: Assistant City Manager
Date: /D �a (�a �/ Marty Hendry :,, _ ity secretary
a I AC R!:Q1,11 I}
APPENDIX A
CITY OF FORT WORTH
AGREED-UPON PROCEDURES
Year Ended September 30, 2008
Agreed-Upon Procedures to be performed (worded as if the procedures have been
completed):
We obtained and read the City's audited financial statements for each of the years ended
September 30, 2008 and September 30, 2007 and noted that:
a) The City's financial statements for each of the past two fiscal years were audited
by an independent certified public accountant and that the auditors' report on the
financial statements expressed an unqualified opinion that the financial statements
were fairly presented in all material respects in accordance with Accounting
Principles Generally Accepted in the United States of America.
b) We calculated the difference between the total annual revenues [total
governmental funds revenues plus enterprise funds operating revenues plus
enterprise funds non-operating revenues (net)plus internal service funds non-
operating revenues (net)] and total annual expenditures [total governmental funds
expenditures, other than capital projects funds expenditures, plus enterprise funds
operating expenses before depreciation plus enterprise funds non-operating
expenses (net)plus internal service funds non-operating expenses (net)] as
defined in section 37.271 (1)(D) for the fiscal years ended September 30, 2008
and 2007 and noted that the City did not operate at a deficit (total annual revenues
minus total annual expenditures) equal to 5.0% or more of total annual revenue in
each of the past two fiscal years.
c) The City did not receive an adverse opinion, disclaimer of opinion, or other
qualified opinion from the independent certified public accountant auditing its
financial statements for each of the fiscal years ended September 30, 2008 and
2007.
4
APPENDIX B
GENERAL BUSINESS TERMS
City of Fort Worth
Year Ended September 30, 2008
1. Independent Contractor. It is understood and agreed that D&T is an independent contractor
and that D&T is not, and will not be considered to be, an agent, partner, fiduciary, or
representative of the City.
2. Survival. The agreements and undertakings of the City contained in the engagement letter
to which these terms are attached (the"engagement letter"), together with the appendices to
the engagement letter including these terms, will survive the completion or termination of
this engagement.
3. Assignment and Subcontracting. Except as provided below, no party may assign, transfer,
or delegate any of its rights or obligations relating to this engagement(including, without
limitation, interests or claims relating to this engagement) without the prior written consent of
the other parties. The City hereby consents to D&T subcontracting a portion of its services
under this engagement to any affiliate or related entity, whether located within or outside of
the United States. Professional services performed hereunder by any of D&T's affiliates or
related entities shall be invoiced as professional fees, and any related expenses shall be
invoiced as expenses, unless otherwise agreed.
4. Severability. If any term of the engagement letter, including its appendices, is determined to
be invalid or unenforceable, such term shall not affect the other terms hereof or thereof, but
such invalid or unenforceable term shall be deemed modified to the extent necessary to
render it enforceable, preserving to the fullest extent permissible the intent of the parties set
forth herein and therein.
5. 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 C and made a part hereof.
5
APPENDIX C
DISPUTE RESOLUTION PROVISION
City of Fort Worth
Year Ended September 30, 2008
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 confidentiality of mediations 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 terminate and the Dispute shall be settled by binding
arbitration to be held in Tarrant County, Texas. 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 modified by this Dispute Resolution Provision (the "Rules").
The arbitration shall be conducted before a panel of three arbitrators. Each of the City 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 Texas (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 confidential, 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.
6
Pagel of 3
Tidwell, Allison
From: Farmer, Maleshia
Sent: Tuesday, October 27, 2009 12:58 PM
To: Tidwell, Allison
Subject: RE: Deloitte &Touche Contract
There's no M&C needed.
Thanks,
Maleshia B. Farmer
Assistant City Attorney
City of Fort Worth
(817) 392-7647
From: Tidwell, Allison
Sent: Tuesday, October 27, 2009 12:57 PM
To: Farmer, Maleshia
Subject: RE: Deloitte &Touche Contract
It had the M&C attached with it. Do I include that or is there no M&C needed for the engagement letter?
SIMWool �sar�C
Administrative/Records Technician
City Secretary's Office
Phone: (817)392-6090
Fax: (817)392-61.96
www.fortworthgov.org/csec
"Individually, we tire one drop. Together, we are,ern ocean."-Rynnosuke.Saloro
From: Farmer, Maleshia
Sent: Tuesday, October 27, 2009 12:14 PM
To: Tidwell, Allison
Subject: RE: Deloitte &Touche Contract
The engagement letter is fine as is. I have previously approved it and you can process without my signature.
Thanks,
Maleshia B. Farmer
Assistant City Attorney
City of Fort Worth
(817) 392-7647
From: Tidwell, Allison
Sent: Tuesday, October 27, 2009 8:07 AM
To: Farmer, Maleshia
Subject: RE: Deloitte &Touche Contract
10/27/2009
Page 2 of 3
Maleshia,
Have you heard anything on this yet?
Administrative/Records Technician
City Secretary's Office
Phone: (817) 392-6090
Fax: (817)392-6196
www.fortwortligov.org/csec
ortwortligov.org/csec
"lndh,idrrally, we are one drop. "/Together, rr,e are arz ocear:."-1yjwizosuke Satoro
From: Farmer, Maleshia
Sent: Friday, October 23, 2009 10:40 AM
To: Tidwell, Allison
Subject: RE: Deloitte &Touche Contract
Hi Allison,
Neither Walter nor Lena are here today. I want to touch base with one of them before this is finalized to make sure that
this engagement is processed correctly. I will contact Walter and follow up with you on Monday. Please hold the contract
until we have a resolution.
Thanks,
Maieshia B. Farmer
Assistant City Attorney
City of Fort Worth
(817) 392-7647
From: Tidwell, Allison
Sent: Friday, October 23, 2009 9:38 AM
To: Farmer, Maleshia
Subject: Deloitte &Touche Contract
Importance: High
Maleshia,
Yesterday, Marlena brought a contract over there for Deloitte & Touche, LLP, for Independent Audit Services
for the Fiscal Year 2009 Comprehensive Annual Financial Report and Single Audit. The extension was for
$1,150,000.00. She was told that you had reviewed the contract and that it was OK to process the way it was.
Did you need to sign off on the legality of the contract, or do we process without your signature? Please advise
in writing so I can place in the contract file.
.S� ,X"-W/
Administrative/Records Technician
City Secretary's Office
10/27/2009
Page 3 of 3
Phone: (817)392-6090
Fax: (817)392-61.96
www.fortworthgov.org/csec
"dndividualli, we are one drop. T(,gether. we are tin ocean."-R unosuke Satoro
10/27/2009
M&C Review Page 1 of 2
01riidai site of the City of Fort Woft,Texas
CITY COUNCIL AGENDA
COUNCIL ACTION: Approved on 6/16/2009
DATE: 6/16/2009 REFERENCE NO.: G-16598 LOG NAME: 13DELOITTE
2009AUD
CODE: G TYPE: NON- PUBLIC CONSENT HEARING: NO
SUBJECT: Authorize a One Year Contract Extension in the Amount of $1,150,000.00 to Deloitte and
Touche, LLP, for Independent Audit Services for the Fiscal Year 2009 Comprehensive
Annual Financial Report and Single Audit
RECOMMENDATION:
It is recommended that the City Council authorize a one year contract extension with additional
compensation in the amount of$1,150,000.00 to Deloitte and Touche, LLP, for independent audit services
for the Fiscal Year 2009 Comprehensive Annual Financial Report and Single Audit.
DISCUSSION:
On April 6, 2004, (M&C C-20025) the City Council awarded the contract for financial auditing services to
Deloitte and Touche, LLP, for a five year period, Fiscal Year 2004 through Fiscal Year 2008. Because the
Fiscal Year 2008 Consolidated Annual Financial Report and Single Audit are nearing completion, City staff
has begun the competitive procurement process with plans to issue a Request for Proposal (RFP) for the
next five fiscal years; however, there is a critical need to avoid confusion and delays that could be the result
of a hasty or ill-timed transition in audit service providers. In an attempt to mitigate a potentially negative
scenario and to provide continuity in the City's audit processes, Financial Management Services
recommends an extension to the existing Deloitte and Touche, LLP, contract which will allow adequate time
to reach out to qualified audit firms, evaluate proposals and establish a productive five year relationship with
a carefully selected audit services provider.
This recommendation was presented to the Audit and Finance Advisory Committee (Committee) on April
23, 2009. The Committee is in favor of this action. This agreement is subject to approval of funds in the
Fiscal Year 2009-2010 budget.
MWBE - Deloitte and Touche, LLP, is in compliance with the City's MWWBE Ordinance by committing to 12
percent MWWBE participation. The City's goal on this project is 12 percent.
FISCAL INFORMATION/CERTIFICATION:
The Financial Management Services Director certifies that upon adoption of the Fiscal Year 2009-2010
budget funds will be available in the City Manager's Fiscal Year 2010 operating budget, as appropriated, of
the General Fund.
TO Fund/Account/Centers FROM Fund/Account/Centers
GG01 531200 0901000 $1,150,000.00
Submitted for City Manager's Office bv: Karen Montgomery (6222)
Originating Department Head: Lena Ellis (8517)
Additional Information Contact: Lena Ellis (8517)
http://apps.cfwnet.org/council_packet/mc_review.asp?ID=11822&councildate=6/16/2009 10/21/2009
M&C Review Page 2 of 2
ATTACHMENTS
http://apps.cfwnet.org/council—packet/mc—review.asp?ID=1 1822&councildate=6/16/2009 10/21/2009