LTC 020-2012 Committee of the Whole MIAMIBEACH R vFn
OFFICE OF THE CITY MANAGER 2012 JAN 23 PM 1' 39
NO. LTC # 020 -2012 LETTER TO COMMISSIONY CLERK'S OF - FiC
TO: Mayor Matti Herrera Bower and Members of the City Commission
FROM: Jorge M. Gonzalez, City Manager
DATE: January 19, 2012
SUBJECT Committee Of The Whole — Audit Committee
The purpose of this LTC is to distribute the audit committee report which was not
discussed at the Committee of the Whole Meeting held on January 11, 2012.
At the suggestion of Commissioner Deede Weithorn, in lieu of being placed on the
February 8, 2012 agenda, we are resubmitting this report that contains a discussion of
the external auditor reports, including their Management Letter for the FY 2009/10 audit
of the City, and a summary of the internal audit activity for FY 2010/11. My staff is
available to brief you individually to answer any question you may have. Please contact
my office if you wish to schedule a briefing.
JMG /K JS
F: \OBPI \$A \INTERNAL AUDIT FILES \DOC11 -12\AUD COM \LTC Audit Committee 1- 11- 12.doc
m MIAMI BEACH
City of Miami Beach, 1700 Convention Center Drive, Miami Beach, Florida 33139, www.miamibeachfl.gov
COMMITTEE OF THE WHOLE MEMORANDUM
TO: Mayor Matti Herrera Bower and Members of the City Commission
FROM: Jorge M. Gonzalez, City Manager
DATE: January 11, 2012
SUBJECT: COMMITTEE OF THE WHOLE —AUDIT COMMITTEE
BACKGROUND
The "Committee Of The Whole" serves as the City's audit committee to review the following
items:
• The External Auditors' reports.
• Internal Audit's annual risk areas / plan.
• Annual Review of Internal Audit findings and status.
Typically, the Committee reviews the status of the City's audits in the spring; however since
the external auditor reports are not usually finalized until July, these reports are typically
discussed around this time along with a discussion of the City's Internal Audit's annual risk
areas / plan.
1. External Auditor's Reports for FY 2009110 (Previously distributed via LTC on
July 22, 2011)
The City's External Auditors are responsible for issuing an opinion after conducting an audit
of the City's financial statements in accordance with Generally Accepted Auditing Standards
and the standards applicable to financial audits contained in the Governmental Auditing
Standards.
The City contracts an external independent audit firm of licensed certified public accountants
to prepare and issue an auditor's opinion after conducting an audit of the City
Comprehensive Annual Financial Report (CAFR) in accordance with Generally Accepted
Auditing Standards and the standards applicable to financial audits contained in the
Governmental Auditing Standards, issue by the Comptroller General of the United States.
The current firm under contract is McGladrey & Pullen, LLP.
The audit is conducted and an opinion expressed on the governmental activities, the
business -type activities, the aggregate discretely presented component units, each major
fund, and the aggregate remaining funds information of the City except for the retirement
and pension funds which are audited by other auditors. Florida State Statues requires this
annual audit. The external auditors also perform a Single Audit separate from the CAFR
audit to satisfy the audit requirements imposed by the Single Audit Act and the U.S. Office of
Management and Budget (OMB) Circular A -133 and the Florida Single Audit Act in
accordance with and Florida Rules of the Auditor General, Section 10.550.
The external auditors issue a separate management letter which addresses any
recommendations to improve financial management, accounting procedures, and internal
F Agenda Item R9 C,
Date -II-1Z
359
control. Their report on internal controls included any reportable condition and material
weaknesses in the system of which they became aware as a result of obtaining an
understanding of the City's internal controls and performance of tests of internal controls.
The report of compliance addresses any material errors, fraud, violation of compliance
requirement and other responsibility imposed by state and federal statutes and regulations
which they may be aware. For the past several years, the external auditor's management
letters contained no reportable conditions and /or material weakness only minor
recommendations to improve financial management, accounting procedures and internal
controls.
Further, the external auditors issue separate opinions on the Miami Beach Redevelopment
Agency, (RDA), the Parking Service Fund, the Miami Beach Convention Center and Jackie
Gleason Theater, the Visitor and Convention Authority (VCA), City of Miami Beach Safe
Neighborhood Parks Bonds Projects, the City of Miami Beach Building Bond Communities
Bond Projects, and the City's Children Trust Fund.
Annually, a Letter to Commission is sent to satisfy the auditors' required communication with
management. Information forwarded with this letter included their Management Letter, the
Single Audit Report, the City's Comprehensive Annual Financial Report and the auditors
required communication with management. Attached as Exhibit 1 is LTC 187 -2011 dated
July 22, 2011 containing the required reports for communication with the City Commission,
2. Internal Auditor's Reports
The City's Internal Audit Division, a component of the Office of Budget and Performance
Improvement, is responsible for ensuring:
• Compliance with Resort Tax Ordinances by auditing Miami Beach businesses;
• Compliance with City policies and procedures and financial integrity and sufficiency
of internal controls by Departments and Not - for - Profits;
• Supporting and special projects assisting other City areas; and
• Integrity of performance measures reported Citywide.
The Division is comprised of nine full time staff including four auditors, four field agents and
one office associate. Three field agents are responsible for auditing business required to file
resort taxes and one is responsible for sanitation audits of franchise haulers and roll -off
operators and administrative functions of the City's Cleanliness Assessment program.
Additionally, resources are shared between resort tax and internal audit functions for the
Internal Auditor, Assistant Internal Auditor, and the office associate.
Resort Tax Audits
The majority of resources in the Division are dedicated to auditing the Miami Beach
businesses required to report and remit resort taxes. This effort is supported by
approximately half of the positions in the Division as well as by outside contract auditors.
Resort tax generated for the fiscal year 2010/11 was $49,011,381.
Scheduled audits are based upon the type of business, actual resort tax receipts received,
and the frequency of the last audit. There are approximately 1,802 businesses registered to
collect resort taxes. Our goal is to audit the 733 businesses consisting of hotels,
restaurants, nightclubs, and bars at least once every 4 years, approximately 183 per year.
New accounts are to be audited soon afterthey are opened. The remaining 1,069 accounts
representing apartments having less risk are audited much less frequently.
In fiscal year 2010/11 the Division completed 205 resort tax audits (82% of our total goal) of
which 120 were hotels, restaurants, nightclubs, and bars. The 205 audits resulted in
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additional tax assessments of $411,438. This represented 2.54% of the total resort tax
reported for these 205 entities over the multi -tax year audited and approximately 0.84% of
the total resort tax generated for fiscal year 2010/11. More importantly, the audits serve as a
deterrent to ensure compliance with the City's resort tax ordinances.
Internal Audits
Scheduled audits are those areas targeted by the Internal Audit Division based on a risk
assessment approach. Audits are classified as to high, medium or low risk. Higher
assigned risk areas are subject to more frequent audits, and lower risk areas are often less
frequent. The Parking Department is considered particularly high risk due to the
considerable revenues received and the manner of collection and therefore has resources
dedicated for ongoing audits. The review of waste franchise contractors and roll -off haulers
for compliance with the City's sanitation ordinance also has been made a priority over the
past several years. In addition, inputs for audits in other Departments are obtained from
Directors and the City Manager. In general, our internal audit goals are as follows:
• Audit 90% of the high risk areas approximately once every five years
• Audit 75% of the medium risk areas approximately once every seven years
• Audit 60% of the low risk areas approximately once every ten years.
However, special circumstances are taken into account which may lengthen or shorten the
period. In addition unplanned projects may impact the schedule in any given year. Annually
required audits include those mandated by City Code and State Agreements, as well as
providing assistance to the City's external auditors.
At previous Finance and City Wide Projects Committee meetings, the Committee
recommended that the administration present a report annually on the status of Department
and Not - For - Profit Internal Audits within the City. Attached is our Status of Audit Areas
through Fiscal Year 2010/11 (Exhibit 2). Audits completed in 2011 are shown in bold.
Overall, twenty -five Department and Not - For - Profit audit areas were completed during fiscal
year 2010/11. The represents 89.2% completed out of twenty -eight audit areas initially
targeted for the year. Out of the audit areas completed, one audit was added during the
year. The remaining four audits were carried forwarded to next fiscal year. This was
accomplished by a staff of five, including 4 continuous monitoring audits in parking and
sanitation by two of the staff. Attached is Summary of Internal Audit Activities (Exhibit 3) for
the past fiscal year.
The Finance and Citywide Projects Committee suggested that Committee members have
the opportunity to review the Internal Audit Reports on -line. Reports are listed on -line on the
City's website at http: / /web.miamibeachfl.gov /obpi /scroll.aspx ?id = 36612.
Fiscal Year 2011/12 Risk Assessment Areas /Audit Plan
Areas highlighted on the Status of Audit Areas report represent those areas considered for
audits based upon the projected frequency. These highlighted areas are a primary source in
developing the annual audit plan. However, the comments provided also indicate reasons
why areas may not be audited within the projected frequency.
The Division continues to take on more supporting projects and other activities relating to
OBPI objectives. These areas include coordinating a revision of City -wide policies and
procedures for posting to intranet and developing a coordinated approach for contract
management reviews for all citywide contracts.
JMG:KGB:JJS
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Exhibit 1 - LTC 187 -2011
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I
MIAMI BEACH
OFFICE OF THE CITY MANAGER
No LTC # 187 -2011
LETTER TO COMMISSION
TO: Mayor Matti Herrera Bower and
Members of the City Commission r
I C
en
FROM: Jorge M Gonzalez City Manager
g ty Ln
DATE- July 22, 2011 i
SUBJECT: ExternalAu0itoes (McGladrey & Pullen) Annu 1 Audit Report on the City, of Miami
Beach (the Crty) for the period ended Septemb er 30, 2010
Attached for your information is the external auditor's repo on the City for the fiscal year ended
September 30, 2010. This package includes the following:
A. The Report to the Mayor and Members of the City Qmmissio discussing,the Auditor's
required communications to the Mayor and City Co mission, summaryof recorded audit
adjustments, accounting estimates and, recently Issued governrmentM accounting standards.
The Report also includes the following:
• Exhibit A - Certain written communications be een management and the Auditors —
Representation letter,
• Exhibit B - McGladrey & Pullen's Independen auditor's report on compliance with
requirements applicable to each majorfederal pr 3grarriandstate project and on Internal
controls over compliance in accordance with ON B Circular A 133 and Chapter 10,550,
Rules of the Auditor General of'the State of No 'da and Schedule of Expenditures on
Federal Awards and State f=inancial Assistance. and
• Exhibit B - McGladrey & Pullen's management lel tet, In accordance with the Rules offhe
Auditor General of the State of Florida, to Me Mayor and Members of the City
Commission.
B. The City's Comprehensive Annual Financial Rep rt (CAFR) for the fiscal year ended
September 30, 2010.
If you have any questions or need additional information pfet se contact Patricia Walker at 305 -673
7574
i
JMG: aw '
McGtadrey$ Pullen, LLP
Certified Public Accountann
McGl adrt- y
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The City of Miami Beach
Report to the Honorable Mayor and the Members of the City Commission
September 30, 2010
AttGiadrey Is %" brand und%I Which R5M MCGladrey, htc.. nd M<I;iladr#y & Puikn, W smo. ctlenW buQnP.m o"dt. MpmAer or WAlntwnftional tvrwe4ka networl, of
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364
McGladrey & Pullen, LLP
Certified Pu6he Accountants
cGladrey
The City of Miami Beach, Florida
1700 Convention Center Drive
Miami Beach, Florida 33139
Attention: The Honorable Mayor and Members of the City Commission
We are pleased to present this report related to our audit of the financial statements of The City of Miami
Beach, Florida (the City) for the year ended September 30, 2010. In addition to our report on your
financial statements which was modified to refer to the use of other auditors related to the City of Miami
Beach Florida Employees' Retirement Plan, the City of Miami Beach Florida Pension Fund for Firefighters
and Police Officers, the Firemen's Relief and Pension Fund, and the Policemen's Relief and Pension
Fund (collectively, the Plans), the Visitor and Convention Authority and the Miami Beach Convention
Center as managed by Global Spectrum, we have provided, under separate cover, a letter, dated March
30, 2011, concerning whether there were any significant deficiencies and material weaknesses in internal
control that we noted during our audit of the City of Miami Beach, Florida's (the 'City*) basic financial
statements for the year ended September 30, 2010. This report summarizes certain matters required by
professional standards to be communicated to you In your oversight responsibility for the City's financial
reporting process. Also included is a summary of recently issued accounting standards that may affect
future financial reporting by the City.
This report is intended solely for the information and use of the Mayor and Members of the City
Commission and management and is not intended to be and should not be used by anyone other than
these specified parties. It will be our pleasure to respond to any questions you have regarding this report.
We appreciate the opportunity to continue to be of service to the City.
Miami, Florida
March 30, 2011
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365
Contents
y
7
Required Communications 1-2
Summary of Accounting Estimates 3-4
Recently Issued Accounting Standards 5
Exhibit A — Certain Written Communications Between Management and Our Firm
Representation Letter !
Exhibit B — Single Audit Reports in Accordance with OMB- Circular A -133 and the Florida '
Single Audit Act and Management Letter in Accordance with the Rules of the Auditor
General of the State of Florida
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Required Communications
Statement on Auditing Standards No. 114 requires the auditor to communicate certain matters to keep
those charged with governance adequately informed about matters related to the financial statement
audit that are, in our professional judgment, significant and relevant to the responsibilities of those
charged with governance in overseeing the financial reporting process. The following summarizes these
communications.
Area Comments
Auditor's Responsibility Under Our responsibility under auditing standards generally
Professional Standards accepted in the United States of America Govemment
Auditing Standards issued by the Comptroller General
of the United States, the provisions of the Single Audit
Act; OMB Circular A-1 33; OMB's Compliance
Supplement, has been described to you in our
arrangement letter dated October 26, 2006.
Accounting Practices Adoption of, or Change In, Accounting Policies
• GASB Statement No. 51, Accounting and
Financial Reporting for Intangible Assets.
This Statement provides guidance regarding
how to identify, account for and report
Intangible assets. The new standard
characterizes an intangible asset as an asset
that lacks physical substance, is nonfinancial
in nature and has an initial useful life
extending beyond a single reporting period.
• Statement No. 53, Accounting and Financial
Reporting for Derivative Instrument. This
statement improves financial reporting by
requiring governments to measure derivative
Instruments at fair value in their economic
resources measurement focus financial
statements. The changes in fair value of
hedging derivative instruments do not affect
investment revenue but are reported as
deferrals. On the other hand, the changes in
fair value of investment derivative instruments
(which include ineffective hedging derivative
instruments) are reported as part of
investment revenue in the current reporting
period.
Significant or Unusual Transactions
We did not identify any significant or unusual
transactions or significant accounting policies in
controversial or emerging areas for which there is a
lack of authoritative guidance or consensus.
Page 1
367
Area Comments
Alternative Treatments Discussed with
Management
We did not discuss with management any alternative
treatments within generally accepted accounting
' principles for accounting policies and practices related
to material items during the current audit period.
Management's Judgments and Summary information about the process used by
Accounting Estimates management in formulating particularly sensitive
accounting estimates and about our conclusions
regarding the reasonableness of those estimates is in
the attached "Summary of Accounting Estimates."
Financial Statement Disclosures In our meeting with you we will discuss with you the
following items as they relate to the neutrality,
consistency and clarity of the disclosures in the
financial statements:
• Adoption of accounting standards
• Results of the Single Audit
Audit Adjustments There were no audit adjustments.
Uncorrected Misstatements There are no uncorrected misstatements.
Disagreements with Management We encountered no disagreements with management
over the application of significant accounting
principles, the basis for management's judgments on
any significant matters, the scope of the audit, or
significant disclosures to be included in the financial
statements.
Consultations with Other Accountants We are not aware of consultations management had
with other accountants about accounting or auditing
matters.
Significant issues Discussed with No significant issues arising from the audit were
Management discussed or were the subject of correspondence with
management.
Difficulties Encountered in Performing the We did not encounter any difficulties in dealing with
Audit management during the audit.
Certain Written Communications Between Copies of certain written communications between our
Management and Our Firm firm and the management of the City are attached as
Exhibit A.
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368
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The City of Miami Beach
Summary of Accounting Estimates
I
Year Ended September 30, 2010
i
Accounting estimates are an integral part of the preparation of financial statements and are based upon
management's current judgment. The process used by management encompasses their knowledge and
experience about past and current events and certain assumptions about future events.. You may wish to
monitor throughout the year the process used to compute and record these accounting estimates. The
following describes the significant accounting estimates reflected in the City's September 30, 2010
financial statements:
Area Accounting Policy Estimation Process Comments
Depreciation of Depreciation on capital Capital assets are We have audited the
Capital Asset assets is provided recorded at historical underlying data supporting
using the straight -line cost or estimated the estimate and believe
method. Leasehold historical cost and the resulting estimate to
improvements are depreciated using the be reasonable.
amortized on a straight -line method
straight -line basis over over the estimated
the shorter of the lease useful lives of the
term or estimated related assets.
useful life of the
assets.
Allowance for All trade and other Receivables are We have audited the
Doubtful Accounts receivables are analyzed for their underlying data supporting
reported at net collectabiliity based on the estimate and believe
realizable value. the creditors' ability to the resulting estimate to
pay (i.e. financial be reasonable.
condition, credit
history, and current
economic conditions).
Other post- The net OPEB The City has informed We have audited the
employment benefit obligation / {asset} us they used all the underlying data supporting
reported for the relevant facts available the estimate and believe
difference between the to them at the time to the resulting estimate to
annual required determine the be reasonable.
contribution and the assumptions used by
actual contributions the actuary in
made by the City. calculating the City's
Annual Required
Contribution and have
approved the results of
the actuarial
determination.
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369
The City of Miami Beach
Summary of Accounting Estimates
Year Ended September 30, 2010
Risk Management The City is partially Management with input We have audited the
self- insured for general from its Risk actuary underlying data supporting
and auto liability, developed the actuarial the estimate and believe
property, workers' assumptions based on the resulting estimate to
compensation, and relevant criteria. be reasonable.
employees' health and Management reviewed
dental. The accrued and approved the
liability for estimated financial statement
claims represents an estimates derived from
estimate of the the Risk actuarial
eventual loss on claims report.
including claims
incurred but not yet
reported.
Pension Plans A net pension The City has informed We have audited the
obligation /(asset) is us that they used all the underlying data supporting
reported for the relevant facts available the estimate and believe
difference between the to determine the the resulting estimate to
annual required assumptions used by be reasonable.
contribution and the the actuary in
actual contributions made calculating the City's
by the City. Annual Required
Contribution and have
approved the results of
the actuarial
determination.
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City of Miami Beach
Recently Issued Accounting Standards
Year Ended September 30, 2010
GASB Statement No. 59, Financial This Statement, issued June 2010, will be effective for the City
Instruments Omnibus beginning with its year ending 2011 (effective for periods
beginning after June, 15, 2010) The objective of this Statement
is to update and improve existing standards regarding financial
reporting and disclosure requirements of certain financial
instruments and external investment pools for which significant
issues have been identified in practice.
GASB Statement No. 60, Accounting The Statement, issued November 2010, will be effective for the
and Financial Reporting for Service City beginning with its year ending 2013 (effective for periods
Concession Arrangements beginning after December 15, 2011.)The objective of this
Statement is to improve financial reporting by addressing
issues related to service concession arrangements (SCAs),
which are a type of public - private or public- public partnership.
The Statement, Issued November 2010, will be effective for the
City beginning with its year ending 2013 (effective for periods
GASB Statement No. 61, The beginning after June 15, 2012.) The objective of this Statement
Financial Reporting Entity. is to modify certain requirements for inclusion of component
Omnibus —on amendment of GASB units in the financial reporting entity. This Statement also
Statements No. 14 and No. 34 amends the criteria for reporting component units as H they
were part of the primary government (that is, blending) in
certain circumstances. This Statement also clarifies the
reporting of equity interests in legally separate organizations. It
requires a primary government to report its equity interest in a
component unit as an asset.
GASB Statement No. 62, Codification This Statement, issued December 2010, will be effective for the
of Accounting and Financial City beginning with its fiscal year ending September 30, 2013.
Reporting Guidance Contained in Pre- The objective of this Statement is to incorporate into the
November 30, 1989 FASB and AICPA GASB's authoritative literature certain accounting and financial
Pronouncements reporting guidance that is included in the following
pronouncements issued on or before November 30, 1989,
which does not conflict with or contradict GASS
pronouncements: (1) Financial Accounting Standards Board
(FASB) Statements and Interpretations; (2) Accounting
Principles Board Opinions; and (3) Accounting Research
Bulletins of the American Institute of Certified Public
Accountants' (AICPA) Committee on Accounting Procedure.
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371
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Exhibit A - Certain Written Communications Between
Management and Our Firm
372
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City of Miami Beach, 1700 Convention Cenler Drive, Miami Deoch, Florida 33139, www.miainibeachfl.gov
FINANCE DEPARTMENT
Tel: 305.673.7465, Fax: 305.673.7795
March 30, 2011
{
s McGladrey & Pullen, LLP
801 Brickell Avenue, suite 1050
Miami, FI 33131
{
In connection with your audit of the basic financial statements of the City of Miami Beach,
Florida, (the "City ") as of and for the year ended September 30, 2010 we confirm that we are
responsible for the fair presentation in the financial statements of financial position, changes in
' financial position, and cash flows in conformity with accounting principles generally accepted in
i the United States of America.
We confirm to the best of our knowledge and belief, as of March 30, 2011 the following
representations made to you during your audit.
1. The financial statements referred to above are fairly presented in conformity with
accounting principles generally accepted in the United States of America.
2. We have identified for you all organizations that are part of this reporting entity or with
i which we have a relationship, as these organizations are defined In Section 2100 of the
Governmental Accounting Standards Board Codification of Governmental Accounting
and Financial Reporting Standards that are Component units. The City's Blended
Component Units and two Discrete Component Units are properly presented in the
{
financial statements.
3. We are not a component unit of any other government, as this term is defined in Section
2100 of the Governmental Accounting Standards Board's Codification of Governmental
Accounting and Financial Reporting Standards.
4. We do not meet the definition of an other organization, as defined in Section 2100 of the
Governmental Accounting Standards Board's Codification of Governmental Accounting
and Financial Reporting Standards.
5. We do not have a joint venture relationship with any other organization, as defined in
i Section 2100 of the Governmental Accounting Standards Board's Codification of
Governmental Accounting and Financial Reporting Standards.
6. We are not a jointly governed organization, as this term is defined in Section 2100 of the
Governmental Accounting Standards Board's Codification of Governmental Accounting
and Financial Reporting Standards.
7. We have Identified for you all of our funds, governmental functions, and identifiable
business -type activities.
8. We have properly classified all funds and activities.
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9. We have properly determined and reported the major governmental and enterprise funds
based on the required quantitative criteria.
10. We are responsible for compliance with laws and regulations applicable to the City
including adopting, approving, and amending budgets.
11. We have identified and disclosed to you all laws and regulations that have a direct and
material effect on the determination of financial statement amounts including legal and
contractual provisions for reporting specific activities in separate funds.
12. We have made available to you:
a. All financial records and related data of all funds and activities, including those of all
special funds, programs, departments, projects, activities, etc., in existence at any
time during the period covered by your audit.
b. All minutes of the meetings of the governing board and committees of board
members or summaries of actions of recent meetings for which minutes have not yet
been prepared.
c. All communications from grantors, lenders, other funding sources or regulatory
agencies concerning noncompliance with:
(1) Statutory, regulatory or contractual provisions or requirements.
(2) Financial reporting practices that could have a material effect on the financial
statements.
13. We have no knowledge of fraud or suspected fraud affecting the entity involving:
a. Management or employees who have significant roles in the Internal control.
b. Others where the fraud could have a material effect on the financial statements.
14. We have not received any communications from employees, former employees,
regulators, vendors or others of any allegations of fraud or suspected fraud affecting the
i City.
15. We acknowledge our responsibility for the design and implementation of programs and
controls to provide reasonable assurance that fraud is prevented and detected.
16. We are aware of no significant deficiencies, including material weaknesses, in the design
or operation of internal controls that could adversely affect the entity's ability to record,
process, summarize, and report financial data, except as reported in your compliance
and internal control letters,
17. There have been no communications from regulatory agencies concerning
noncompliance with, or deficiencies in, financial reporting practices.
18. We have no plans or Intentions to engage in any activity that may materially affect the
carrying value or classification of assets and liabilities.
19. The following have been properly recorded and/or disclosed in the financial statements,
where applicable:
a. Related party transactions, including those as defined in Section 2100 of the
Governmental Accounting Standards Board's Codification of Governmental
Accounting and Financial Reporting Standards, and interfund transactions, including
interfund accounts and advances receivable and payable, sale and purchase
transactions, interfund transfers, long -term loans, leasing arrangements and
374
guarantees, all of which have been recorded in accordance with the economic
substance of the transaction and appropriately classified and reported.
b. Security agreements In effect under the Uniform Commercial Code.
c. Any other liens or encumbrances on assets or revenues or any assets or revenues
which were pledged as collateral for any liability or which were subordinated in any
way.
d. The fair value of investments.
e. Amounts of contractual obligations for construction and purchase of real property or
equipment not included in the liabilities or encumbrances recorded on the books.
f. Any liabilities which are subordinated in any way to any other_ actual or possible
liabilities.
g. Debt issue provisions and bond refunding amounts.
h. All leases and material amounts of rental obligations under long -term leases.
i 1. All significant estimates known to management which are required to be disclosed in
accordance with the AICPA's Statement of Position 94 -6, Disclosure of Certain
Significant Risks and Uncertainties. Significant estimates are estimates at the
balance sheet date which could change materially within the next year.
j. Risk financing activities.
k. Deposits and investment securities categories of risk.
1. Pollution remediation obligations as required under GASS Statement No. 49.
m. Defined benefit plans and other post employment benefit plans.
j n. Line of credit or similar arrangements.
o. Authorized but unissued bonds and/or notes.
p. We have adopted the following GASS Statements:
GASS Statement No. 51, "Accounting and Financial Reporting for Intangible
Assets," and
It is management's decision not to disclose the following GASS Statements which
! have been issued, but not yet adopted, due to the fact that these statements will not
have a material effect on the financial statements of the City until upcoming fiscal
years:
- GASS Statement No. 59, Financial Instruments Omnibus
- GASS Statement No. 60, Accounting and Financial Reporting for Service
Concession Arrangements
- GASS Statement No. 61, The Financial Reporting Entity: Omnibus
- GASS Statement No. 62, Codification of Accounting and Financial Reporting
Guidance Contained in Pre - November 30, 1989 FA SS and A1CPA Pronouncements
I
20. We are responsible for making the accounting estimates included in the financial
statements. Those estimates reflect our judgment based on our knowledge and
experience about past and current events and our assumptions about conditions we
expect to exist and courses of action we expect to take. In that regard, adequate
provisions have been made:
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a. To reduce receivables to their estimated net collectable amounts.
b. For risk retention, including uninsured losses or loss retentions (deductibles)
attributable to events occurring through September 30, 2010 and/or for expected
retroactive insurance premium adjustments applicable to periods through September
30, 2010.
c. For pension obligations, post - retirement benefits other than pensions and deferred
compensation agreements attributable to employee services rendered through
September 30, 2010.
No provision is required:
a. To reduce obsolete, damaged, or excess inventories to their estimated net realizable
values.
b. To reduce investments, intangibles, and other assets which have permanently
declined in value to their realizable values.
21. There are no:
a. Material transactions that have not been properly recorded In the accounting records
underlying the financial statements. For purposes of this representation, we consider
items to be material, regardless of their size if they involve the misstatement or
omission of accounting information that in light of surrounding circumstances makes
It probable that the judgment of a reasonable person relying on the information would
be changed or influenced by the omission or misstatement.
b. Violations or possible violations of laws or regulations whose effects should be
i considered for disclosure in the financial statements or as a basis for recording a loss
contingency. In that regard, we specifically represent that we have not been
designated as, or alleged to be, a 'potentially responsible party" by the Federal
Environmental Protection Agency or any equivalent state agencies in connection with
any environmental contamination.
i
c. Other material liabilities or gain or loss contingencies that are required to be accrued
or disclosed by Statement of Financial Accounting Standards No. 5 and /or GASS
Statement No. 10.
d. Guarantees, whether written or oral, under which the Government is contingently
liable.
e. Arrangements with financial institutions involving compensating balances or other
arrangements involving restrictions on cash balances.
f. Agreements to repurchase assets previously sold.
g. Debt issue repurchase options or agreements, or sinking fund debt repurchase
ordinance requirements.
h. Special and extraordinary items.
I. Impairment of capital assets.
j. Material losses to be sustained in the fulfillment of, or from the inability to fulfill, any
service commitments.
1 k. Material losses to be sustained as a result of purchase commitments.
I. Arbitrage liabilities.
376
m. Derivative financial instruments.
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22. In connection with your audit, conducted in accordance with Government Auditing
Standards, we confirm:
a. We are responsible for:
I. Compliance with the laws, regulations, and provisions of contracts and grant
agreements applicable to the City.
ii. Establishing and maintaining effective internal control over financial reporting.
b. We have identified and disclosed to you:
1. All laws, regulations, and provisions of contracts and grant agreements that have
a direct and material effect on the determinations of financial statement amounts
or other financial data significant to audit objectives.
ii. Violations (and possible violations) of laws, regulations, and provisions of
contracts and grant agreements whose effects should be considered for
disclosure in the auditor repository or noncompliance.
c. We have no violations of provisions of contracts or grant agreements that have been
reported.
d. We have a process to track the status of audit findings and recommendations.
e. We have identified for you previous financial audits, performance audits, or other
studies related to the objectives of the audit being undertaken and the corrective
action taken to address significant findings and recommendations.
23. We have no direct or indirect, legal or moral, obligation for any debt of any organization,
public or private or to special assessment bond holders that is not disclosed in the
financial statement.
24. We have satisfactory title to all owned assets.
25. We have complied with all aspects of contractual agreements that would have a material
effect on the financial statements in the event of noncompliance.
26. Net asset components (invested in capital assets, net of related debt; restricted Included
and not limited to excess building permit fees; and unrestricted) are properly classified
and, if applicable, approved.
27. GASB 54 establishes fund balance classifications (nonspendable, restricted, committed,
assigned and unassigned) that comprise a hierarchy based primarily on the extent to
which a government is bound to observe constraints Imposed upon the use of the
resources reported In governmental funds. Fund balance for governmental funds in
each of the aforementioned categories is properly classified and disclosed in accordance
with GASB 54 and if applicable, approved.
28. Expenses have been appropriately classified in or allocated to functions and programs in
the statement of activities, and allocations have been made on a reasonable basis.
29. Revenues are appropriately classified in the statement of activities within program
revenues and general revenues.
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377
30. Capital assets, including infrastructure assets, are properly capitalized, reported, and
depreciated.
31. Required supplementary information is properly measured and presented.
32. There are no unasserted claims or assessments that our lawyers have advised us are
i
probable of assertion and must be disclosed in accordance with Statement of Financial
Accounting Standards No. 5 and /or GASB Statement No. 10.
33. We are responsible for and have reviewed and approved the proposed adjustments to
the trial balances identified during the audit and will post all adjustments accordingly.
34. The City has complied with the provisions of Section 218.415, Florida Statutes regarding
the investment of public funds.
35. The City is not in a state of emergency based upon the conditions described in Section
218.503(1), Florida Statutes.
i
36. Management has assessed the financial condition of the City and noted no deteriorating
financial condition.
Except for the Issuance of Parking revenue refunding bonds on November 16, 2010, and the
authorization of a line of credit not to exceed an aggregate principle amount of $30 million on
January 19, 2011, there are no events or transactions that have occurred subsequent to the
balance sheet date and through the date of this letter that would require adjustment to, or
disclosure in, the financial statements.
During the course of your audit, you may have accumulated records containing data which
should be reflected In our books and records. All such data have been so reflected.
Accordingly, copies of such records in your possession are no longer needed by us.
The City of Miami Beach, Florida
I
J e . Go alez
it r>gya
Patricia D. Walker
Chief Financial Officer
t
1 Allison R. Williams
Chief Accountant
378
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Pie MIAMI BEACH
City of Miami Beach, 1700 Convenlion Center Drive, Miami Beach, Florida 33139, www.miamibaoclif.gov
FINANCE DEPARTMENT
Tel: 305.673.7000 Fax: 305.673.7795
June 24, 2011
McGladre Y & Pullen, LIP
801 Brickell Avenue, suite 1050
Miami, FI 33131
In connection with your audit of federal awards and state projects as of and for the year ended September 30,
2010 conducted in accordance with OMB CircularA -133, Audits of States, Local Governments, and Non - Profit
Organizations, and Chapter 10.550, Rules of the Auditor General, we confirm:
1. a. We are responsible for complying, and have complied in all material respects with the
requirements of Circular A -133 and Chapter 10.550, Rules of the Auditor General.
b. We have prepared the schedule of expenditures of federal awards and state projects in
accordance with Circular A -133 and Chapter 10,550, Rules of the Auditor General and have
I Included expenditures made during the period being audited for all awards provided by federal
agencies in the form of grants, federal cost - reimbursement contracts, loans, loan guarantees,
property (including donated surplus property, cooperative agreements, interest subsidies,
insurance, food commodities, direct appropriations, and other assistance.
c. We are responsible for establishing and maintaining, and have established and maintained,
effective Internal control over compliance for federal programs and state projects that provides
reasonable assurance that the City is managing federal awards and state projects in compliance
with laws, regulations, and the provisions of contracts or grant agreements that could have a
material effect on our federal programs and state projects.
d. We are responsible for complying with the requirements of laws, regulations, and the provisions of
contracts and grant agreements related to each of the City's federal programs and state projects
and have complied, in all material respects, with those requirements.
e. We have identified and disclosed to you the requirements of laws, regulations, and the provisions
of contracts and grant agreements that are considered to have a direct and material effect on
each major program.
f. We have provided you with our interpretations of any compliance requirements that have varying
interpretations.
We are commiW b ryovidingi exceA&V public service and solely b all who live, work, and ploy in our vibron►, tropical, hisbric cornmunNy
379
McGladrey & Pullen, 11P
Page 2 of 3
i g. We have made available all contracts and grant agreements (including amendments, if any) and
any other correspondence that has taken place with federal agencies or pass - through entities
f related to federal programs and state projects.
h. We have identified and disclosed to you all amounts questioned and any known noncompliance
with the requirements of federal awards and state projects, including those resulting from other
audits or program reviews.
I. We have charged costs to federal awards and state projects in accordance with applicable cost
principles.
j. We have made available to you all documentation related to the compliance requirements,
including information related to federal program and state projects financial reports and claims for
advances and reimbursements.
k. Federal program and state projects financial reports and claims for advances and reimbursements
are supported by the books and records from which the basic financial statements have been
prepared.
I. The copies of federal program and state projects financial reports provided to you are true copies
i of the reports submitted, or electronically transmitted, to the federal and state agency or pass-
through entity, as applicable.
m. We are responsible for and have accurately prepared the summary schedule of prior audit findings
to include all findings required to be included by Circular A-1 33 and Chapter 10.550, Rules of the
Auditor General,
n. We have provided you with all information on the status of the follow -up on prior audit findings by
federal awarding agencies and pass - through entities, including all management decisions.
o. We have accurately completed the appropriate sections of the data collection form.
p. We have disclosed all contracts or other agreements with service organizations.
q. We have disclosed to you all communications from service organizations relating to
noncompliance at those organizations.
r. We have disclosed any known noncompliance occurring subsequent to the period for which
compliance is audited.
s. We have disclosed whether any changes In internal control over compliance or other factors that
might significantly affect internal control, including any corrective action taken by management
with regard to significant deficiencies (including material weaknesses), have occurred subsequent
of the date as of which compliance Is audited.
t. We have monitored subrecipients to determine that they have expended pass - through assistance
in accordance with applicable laws and regulations and have met the requirements of Circular A-
133 and Chapter 10.550, Rules of the Auditor General.
u. We have issued management decisions on a timely basis after our receipt of subrecipients'
auditors reports that identified noncompliance with laws, regulations, or the provisions of contracts
or grant agreements, and we have ensured that subrecipients have taken the appropriate and
timely corrective action on findings.
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We ore copunined b pwvid4V ane&m pnb(fc swwca and salary 10 at wf o five, work, and ploy in our Wbronl, kopka( Idss;xic c 111 silly.
380
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McGladrey & Pullen, LLP
Page 3 of 3
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2. Unless disclosed to you, there have been no complaints filed with or concerning our compliance with
the provisions of.
a. Davis -Bacon Act relative to payment of prevailing wage rates.
b. Uniform Relocation Assistance and Real Property Acquisition Polices Act of 1970 relative
to acquisition or real property and the relocation of occupants of acquired property.
3. We have acknowledged the findings as described in the single audit report and the management letter
and have provided responses and planned corrective actions accordingly.
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The City of Miami Beach, Florida
f
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Patricia D. Walker
Chief Financial Officer
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Hilda Femandez
Assistant City Manager
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Allison R. Williams
Chief Accountant
3 '3
We we conuniiled to povidng excellent public service and sdey b off who live. wak, and play in ow Avow. hopicol, 193lwic carxixndy
381
Exhibit B - Single Audit Reports in Accordance with OMB -
Circular A -133 and the Florida Single Audit Act and
Management Letter in Accordance with the Rules of the
Auditor General of the State of Florida
382
City of Miami Beach, Florida
Single Audit Reports in Accordance With OMB Circular A -133 and
Chapter 10.550, Rules of the Auditor General of the State of Florida
September 30, 2010
383
Contents
Independent Auditors Report
on Internal Control Over Financial Reporting
and on Compliance and Other Matters Based on an Audit
of Financial Statements Performed in Accordance With
GovemmentAudi6nq Standards 1 -2
Independent Auditors Report
on Compliance With Requirements That Could Have a Direct
and Material effect on Each Major Program and State Project
and on Internal Control Over Compliance in Accordance
With OMB Circular A -133 and Chapter 10.550,
Rules of the Auditor General, State of Florida 3-5
Schedule of Expenditures of Federal Awards and State Financial Assistance 6-8
Notes to Schedule of Expenditures of Federal Awards and State Financial Assistance 9
Schedule of Findings and Questioned Costs 10-18
Schedule of Prior Year Audit Findings 19-20
384
McCladrey
Independent Auditor's Report
on Internal Control Over Financial Reporting
and on Compliance and Other Matters Based on an Audit
of Financial Statements Performed in Accordance With
Government Auditing Standards
The Honorable Mayor and City Commissioners
City of Miami Beach, Florida
We have audited 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 of the City of
Miami Beach, Florida (the 'City") as of and for the year ended September 30, 2010, which collectively comprise the
City's basic financial statements and have Issued our report thereon dated March 30, 2011. Our report included
references to other auditors. We conducted our audit In accordance with auditing standards generally accepted in the
United States of America and the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States. Other auditors audited the financial statements
of the Visitor and Convention Authority; the Miami Beach Convention Center as managed by Global Spectrum
('Global Spectrum'); the City of Miami Beach Florida Employees' Retirement Plan; the City of Miami Beach Florida
Pension Fund for Firefighters and Police Officers; the Firemen's Relief and Pension Fund; and the Policemen's Relief
and Pension Fund, as described in our report on the City's financial statements. This report does not include the
results of the other auditors' testing of internal controls over financial reporting or compliance and other matters that
are reported on separately by those auditors. The financial statements of Global Spectrum, the City of Miami Beach
Florida Employees' Retirement Plan; the City of Miami Beach Florida Pension Fund for Firefighters and Police
Officers; and the Miami Beach Policeman's Relief and Pension Fund, audited by other auditors, were not audited in
accordance with Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the City's internal control over financial reporting as a basis for
designing our auditing procedures for the purpose of expressing our opinion on the financial statements, but not for
the purpose of expressing an opinion on the effectiveness of the City's internal control over financial reporting.
Accordingly, we do not express an opinion on the effectiveness of the City's internal control over financial reporting.
A deficiency in internal controf exists when the design or operation of a control does not allow management or
employees, in the normal course of performing their assigned functions, to prevent, or detect and correct
misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal
control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will
not be prevented, or detected and corrected on a timely basis.
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The two liras operating n separate kcal anthian to an alternative praake atnuctun. independent weauntieo. tax and eowAuq fktaa
1
385
Our consideration of internal control over financial reporting was for the limited purpose described in the first
paragraph of this section and would not necessarily identify all deficiencies in internal control that might be significant
deficiencies or material weaknesses. We did not Identify any deficiencies in internal control over financial reporting
that we consider to be material weaknesses, as defined above.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City's basic financial statements are free of material
misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant
agreements, noncompliance with which could have a direct and material effect on the determination of financial
statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our
audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of
noncompliance or other matters that are required to be reported under Government Auditing Standards.
We noted certain matters that we reported to management of the City in a separate letter dated March 30, 2011.
This report is intended solely for the information and use of the Honorable Mayor, the Members of the City
Commission, management of the City, the Auditor General of the State of Florida, federal and state awarding
agencies and pass- through entities, and is not intended to be, and should not be used by anyone other than these
specified parties.
A em *1 �
Miami, Florida
March 30, 2011
2
386
McCladrey
Independent Auditor's Report
on Compliance With Requirements That Could Have a Direct
and Material effect on Each Major Program and State Project
and on Internal Control Over Compliance in Accordance
With OMB Circular A•133 and Chapter 10.550,
Rules of the Auditor General, State of Florida
The Honorable Mayor and City Commissioners
City of Miami Beach, Florida
Compliance
We have audited the City of Miami Beach, Florida (the 'City*) compliance with the types of compliance requirements
described in the OMB Circular A -133 Compliance Supplement and the requirements described in the Department of
Financial Services' State Projects Compliance supplement, that could have a direct and material effect on each of the
City's major federal programs and each of its major state projects for the year ended September 30, 2010. The City's
major federal programs and state projects are identified in the summary of auditor's results section of the
accompanying schedule of findings and questioned costs. Compliance with the requirements of laws, regulations,
contracts, and grants applicable to its major federal programs and state projects is the responsibility of the City's
management. Our responsibility is to express an opinion on the City's compliance based on our audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States
of America; the standards applicable to financial audits contained In Govemment Auditing Standards, issued by the
Comptroller General of the United States; OMB Circular A -133, Audits of States, Local Governments, and Non Profit
Organizations, and Chapter 10.550, Rules of the Auditor General, State of Florida. Those standards, OMB Circular
A -133 and Chapter 10.550, Rules of the Auditor General, require that we plan and perform the audit to obtain
reasonable assurance about whether noncompliance with the types of compliance requirements referred to above
that could have a direct and material effect on a major federal program or major state project occurred. An audit
includes examining, on a test basis, evidence about the City's compliance with those requirements and performing
such other procedures as we considered necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinion. Our audit does not provide a legal determination of the City's compliance with
those requirements.
In our opinion, the City complied, In all material respects, with the compliance requirements referred to above that
could have a direct and material effect on each of its major federal programs and its major state projects for the year
ended September 30, 2010. However, the results of our auditing procedures disclosed instances of noncompliance
with those requirements, which are required to be reported in accordance with OMB Circular A -133 and Chapter
10.550, Rules of the Auditor General, and which are described in the accompanying schedule of findings and
questioned costs as items CF 2010 -01 through CF 2010-03.
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The two ncns operating at separate 1wi antktn In an aheraative practice stnxture. Independent acvwwdng, tax and conwking Rand
3
387
Internal Control Over Compliance
The Management of the City is responsible for establishing and maintaining effective internal control over compliance
With requirements of laws, regulations, contracts, and grants applicable to federal programs and state projects. In
planning and performing our audit, we considered the City's internal control over compliance with requirements that
could have a direct and material effect on a major federal program or major state project to determine the auditing
procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over
compliance in accordance with OMB Circular A -133 and Chapter 10.550, Rules of the Auditor General, but not for the
purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not
express an opinion on the effectiveness of the City's internal control over compliance.
A defrclency in internal control over compliance exists when the design or operation of a control over compliance
does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or
detect and correct, noncompliance with a type of compliance requirement of a federal program or state project on a
timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies,
in internal control over compliance, such that there Is a reasonable possibility that material noncompliance with a type
of compliance requirement of a federal program or state project will not be prevented, or detected and corrected on a
timely basis.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of
this section and was not designed to identify all deficiencies in Internal control over compliance that might be
deficiencies, significant deficiencies or material weaknesses. We did not identify any deficiencies over compliance
that we consider to be material weaknesses, as defined above. However, we identified certain deficiencies in internal
control over compliance that we consider to be significant deficiencies as described in the accompanying Schedule of
Findings and Questioned Costs, as items IC 2010-01 through IC 2010 -06. A significant deficiency in internal control
over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of
compliance requirement of a federal program or state project that is less severe than a material weakness In internal
control over compliance, yet important enough to merit attention by those charged with governance.
Schedule of Expenditures of Federal Awards and State Financial Assistance
We have audited 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 of the City as
of and for the year ended September 30, 2010 and have issued our report thereon dated March 30, 2011. Our audit
was performed for the purpose of forming our opinions on the financial statements that collectively comprise the
City's basic financial statements. The accompanying schedule of expenditures of federal awards and state financial
assistance is presented for purposes of additional analysis as required by OMB Circular A -133, and Chapter 10.550,
Rules of the Auditor General, and is not a required part of the basic financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly
stated, in all material respects, in relation to the basic financial statements taken as a whole.
The City's responses to the findings identified in our audit are described in the accompanying schedule of findings
and questioned costs. We did not audit the City's response and, accordingly, we express no opinion on it.
4
388
}
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This report is intended solely for the information and use of the Honorable Mayor, the Members of the City
Commission, management of the City, the Auditor General of the State of Florida, federal and state awarding
agencies, and pass - through entities, and is not intended to be and should not be used by anyone other than these
specified parties.
/ /CX�
Miami, Florida
June 24, 2011, except for the
Schedule of Expenditures of Federal
Awards and State Financial Assistance
which 1s dated March 30, 2011
5
389
City of Miami Beach, Florida
Schedule of Expenditures of Federal Awards and State Financial Assistance
Year Ended September 30, 2010
CFDA!
Federal/State Grantor/Pass- Through Entity CSPA Grandcontract
Program Title Number Number Expenditures
Federal Grants:
U.S. Department of Haring and Urban Development:
Direct Programs:
Community Development Block Grant/Entitlement Grants 14116 B- XX-MC- 12-0014 S 1534,050
Hans Investment Partnership Program 14.239 M- XX-MC- 12-0014 1,549,407
C wnxrity Demopmemt Block Grants — Section 108 Loan Guarantees 14.246 B- 94 -MG12 -0014 7,083
ARRA- Community DevelopmeN Block Grant Recovery ARRA Errdttennent Grants
(CDBG-R) Recovery Act Funded 14.253 B -WW -12 -0014 91,096
ARRA-Hometess Premnlion and Rapid Rehousing Program 14.257 S09-W- 12-0007 359,062
Pass4hrough Dept. Community ABairs — Pass through — Miami Dade County:
SuWdve Housing Program 14.235 FL148800034 S FL0177ND0008D2 62A60
Community Development Block Grant -DRI -Vile Maria 14.228 OBDB- D3-11. 23-01 -A01 396
Cornmu nily Developrnenl Block GrarO -DRI Flamingo Park Neighborhood Improvements 14 .228 08- DB- D3- 11- 23- 01 -A01 5000
Pass-through Department of Community ADaks:
Community Development Block Grants - Neighborhood Stabilization Program 14.228 IODI3 4X -11 -23-01 -1`16 7,154,374
7,611,524
Total U.S. Department of Housing and
Urban Development 11214672
U.S. Department of Justice:
Direct Program:
Part E — Developing, Testing and Demonstrating Promising New Programs — Juvenile Justice
and Delinquency Prevention —Teen Club 16.541 2008JL -FX- 0481 205,317
Part E — Developing, Testing and Demonstglmg Promising New Programs — Juvenile Justice
and Delinquency Prevention —Teen Club Salary 16.541 2009- 01- SX-0291 192,232
397,549
ARRA- Edward Byrne Memorial AMM Assistance (JAG - CADARMS) 16.804 2009 SB-69. 2634 32,666
Cwn%&Nty Oriented Polop Servitor:
Public Safety Partnership and Community PolickV Grants -Child Sexual Pnedalor Program 16.710 2009CSWX0004 166,376
National Instiknte of Justice:
National Institute of Justice Research. Evaluation, and Development -Police Homicide Cold Case 16560 2009- DN- eX -KD09 70AN
Br4ietpoofvest Pann ershiplBody Armor Sotety Wdative
Bulletproof Vest Partnership Program 16.667 OM 1121 -D235 4.836
BuOetprool Vest Partnership Program 16.607 OMB# 1121.0235 2200
6,936
Pass - Through Stale of ForidalWamfDade County:
Edward Byrne Memodat Justice Assistance Gant Program — Byrne Cdninal Justice Records 16.73e WA 14A37
Total U.S. Departme"t of Justice 6a7
(Continued)
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City of Miami Beach, Florida
Schedule of Expenditures of Federal Awards and State Financial Assistance (Continued)
Year Ended September 30, 2010
CFDA!
FederallStateGrantorlPass •Through Entity CSFA GranUContract
Program Title Number Number EVendittuss
U.S. Department d Energy:
area Program
ARRA- Energy Efficiency and Conservation Block Grant 81 128 DE-S00003489 197,438
Total U.S. Department of Energy 197,438
Pass-through Stale of Florida
Office of Attorney General
Came Victim Assistance - VOCA 16.575 VOD027 52,927
Total Office of Attorney 52,927
Pass - through State of Flodda:
Department of Agriculture and Consumer Services
Cooperative Forestry Assistance - Urban and Community Forestry 10.664 015154 15,000
ARRA- Recovery Ad of 2009: Wildland Fire Management Forest Health Improvement l0ative 10.688 015956 16,000
Total Dep Kmmntof Agriculture and Consumer Services 33,000
U.S. Department of Transportation:
Federal Transit Administration
area Program
Federal Transit - Capital Investment Grants - Elechowave Shuttle Service 20.500 FL- 03-0233 735,021
FederalTraneil - CaptalInvestmentGrants - ElectrowaveShuttleService 20.500 FL- 03.0245 377,051
Federal Transit - Capital Investment Grants - Electrowave Shuttle Service 20.500 FL- 98X487 -00 000,000
1,713,772
Pass - through Slate of Florida:
Florida DepAwnl of Transportation
Hghway panning and Construdioa-Beachwalk If 20.205 412796.1 34,020
AWWHigtwray Planning and Cornatrudion- Sunset Dr. Bridge 20.205 426501.1 (ARRA453) 209,450
ARRA-Nighway Planning and Construction- Suncel Dr. Bridge 20.205 426502.1 (ARRA454) 254,014
ARRA- Highway Planning and Construction- Henedon Ave. Bridge 20.205 426497.1 (ARRA.339) 199,034
757,924
Total U.S. Department of Transportation 2,471,696
U.S. Department of Homeland Security:
Direct Program:
Emergency Food and Shofar National Board Program -
EFS Phase 27 97.024 159404076 7,739
Emergency Food and Shelter National Board Program -
EFS Phase 28 97.024 159400 -076 9,675
Total U.S. Department of Homeland Security 17,414
Pass-through State of Florida:
Florida Depeetmem of Cornmrnity Affairs
Pass- ga'ough Miami Dade County
Office of Domestic Preparedness
Homeland Security Grant Program - Urban Pesos
Security Initiative 2007 97.067 09DS- 24-11- 23-02 -011 220,037
Homeland Security Grant Program -Urban Areas
Security IniU MS 2008 97.067 10DS -48. 11.23-02495 15,000
243,037
Pass - through Salts of Florida:
Florida Department of Community Affairs
Disaster Grants -Public Assistance- FEMA- Mastor Relief Funding Agreement 97.036 06- WL-&K•11. 23.02 - 5670 00,466
Hazard Mitigation Grant 97,039 OBHM-6G -11- 23-02 -060 4831
Toted State- Pass- Ftorlda Dept of CommunRy Affairs 371,334
Total ExpendReras of Federal Awards 15.048.339
(Continued)
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City of Miami Beach, Florida
Schedule of Expenditures of Federal Awards and State Financial Assistance (Continued)
Year Ended September 30, 2010
CFDAI
FaderallState Gra rloriPass•Throogh Entity CSFA GrantlContract
Program Title Number Number Expenditures
State Grants:
Florida Departmental Health:
Pass-Through Miaml-Dade County:
EmeMerky Pmv/PrWIPtesp"a -EMS Couny Grants 64.005 C -9013 S 49,794
Florida Deparment of Health:
Emergency PrevlPrWResponse -EMS Count' Grants 64 .003 M9273 14,426
Department of Management Services
Pass through Miami -Oade County:
E911 State Grant Program 72.002 S2 -08 -10.5 467,324
Florida Department of State:
Division of Historical Resources:
Ksioric Preservation Grant -Fire Station No 2 45.031 SCI 14 81$11
Division of Cultural Affairs:
Cultural and Museum Grants7Cuiiure Builds Florida- Sleepless NIpM 2009 45.058 NIA 25AOD
Florida Department of Environmental Prolectiorc
Florida Racroation Development Assistance PrograrrrFiamingo Pads Tennis Renov. 37.017 A08187 178,910
Florida Housing Finance Corpara0on:
State Housing Initiatives Partnership Program 52.901 NA 1,939,266
Florida Department of Transportation
State Highway Project Reimbursement - Indian Creek SR AtA 41st -26th Street 55.023 AOY 48 939,803
16th Street Corridor 55012 ANH65 27,255
Tai ExpendRures of State Financial Assistance 2,823,706
Total Expenditures of Federal Awards and
Stan Financial Assistance 5S 11
See Notes to Schedule of Expenditures of Federal Awards and State Financial Assistance.
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City of Miami Beach, Florida
Notes to Schedule of Expenditures of Federal Awards and State Financial Assistance '
1. General
The accompanying Schedule of Expenditures of Federal Awards and State Financial Assistance (the "Schedule ")
presents the expenditure activity of all federal awards and state projects of the City of Miami Beach, Florida (the
'City") for the year ended September 30, 2010. The City's reporting entity is defined In Note 1 of the City's basic
financial statements. All federal awards and state financial assistance received directly from federal and state
agencies, as well as amounts passed through other government agencies are included in the accompanying
Schedule of Expenditures of Federal Awards and State Financial Assistance. Because the schedule presents only a
selected portion of the operations of the City, it is not intended to and does not present the financial position or
changes in net assets of the City.
2. Basis of Accounting
The accompanying Schedule of Expenditures of Federal Awards and State Financial Assistance is presented using
the modified accrual basis of accounting for grants which are accounted for in the governmental fund types and on
the accrual basis of accounting for grants which are accounted for in the proprietary fund types. The information in
the Schedule of Expenditures of Federal Awards and State Financial Assistance is presented in accordance with the
requirements of OMB Circular A -133, Audits of States, Local Governments, and Non -Profit Organizations and
Chapter 10.550, Rules of the Auditor General Therefore, some amounts presented in this schedule may differ from
amounts presented In or used in the preparation of the basic financial statements.
3. Subreciplant Awards
Of the federal awards and state financial assistance presented in the Schedule of Expenditures of Federal Awards
and State Financial Assistance, the City provided the following amounts to subrecipients:
Amount
CFDA(CSFA Provided
Name of Program/Projects Number to Subrecipient
Federal:
Community Development Block Grant 14.218 $ 909,386
Community Development Block Grant — DRI 14.228 398,250
Community Development Block Grant — Neighborhood Stabilization Grant 14.228 7,057,456
Home Program 14.239 1,447,860
ARRA- Community Development Block Grant Recovery 14.253 91,086
Total Federal ,
State:
State Housing Initiatives Partnership Program 52.901 $ 1,023,370
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City of Miami Beach, Florida
Schedule of Findings and Questioned Costs
Federal Awards Programs and State Projects
Section I — Summary of Auditor's Results
jmancial Statements
Type of auditors report issued: Unqualified
Internal control over financial reporting:
Material weakness(es) identified? Yes X No
Significant deficiency(ies) identified that are
not considered to be material weakness(es)? Yes X No
Noncompliance material to financial statements noted? Yes X No
Federal Awards
Internal control over major program:
Material weakness(es) identified? Yes X No
Significant defticiency(ies) identified that are not considered
to be material weakness(es)? X Yes None reported
Type of auditors report issued on compliance for
major programs: Unqualified
Any audit findings disclosed that are required
to be reported in accordance with Section 510(a)
of Circular A -133? X Yes No
Identification of major program:
Federal CFDA No. Name of Federal Prooram or Cluster
14.218 U.S. Department of Housing and Urban Development:
Community Development Block Grant
14.228 U.S. Department of Housing and Urban Development:
Community Development Bkxk Grants- Neighborhood Stabilization Program
14.257 U.S. Department of Housing and Urban Development
ARRA- Homeless Prevention and Rapid Rehousing Program
20.205 U.S. Department of Transportation:
ARRA- Highway Planning and Constriction
20.500 U.S. Department of Transportation:
FTA Section 5309- Electrowave Shuttle Service
Dollar threshold used to distinguish between type
A and type B programs: $451,392
Auddee qualified as low -risk auditee? X Yes No
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City of Miami Beach, Florida
Schedule of Findings and Questioned Costs (Continued)
Federal Awards Programs and State Projects
State Finan ial Assistance
Internal control over major projects:
Material weakness(es) identified? Yes X No
Significant deficiency(ies) identified that are
not considered to be material weakness(es)? X Yes None reported
Type of auditor's report issued on compliance for
major projects: Unqualified
Any audit findings disclosed that are required
to be reported in accordance with Chapter 10.550,
Riules of ft Auditor General? X Yes No
Identification of major projects:
State CSFA No. Name of State Protects
52.901 Florida Housing Finance Corporation:
State Housing India*m Partnership Program
55.023 Florida Department of Transportation:
State Highway Project Reimbursement -
indian Creek SR All A 41st -26th Street
72.002 Department of Management Services
Pass through Miami -Dade County:
E911 State Grant Program
Dollar threshold used to distinguish between type
A and type B programs: $300,000
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City of Miami Beach, Florida
Schedule of Findings and Questioned Costs (Continued)
Federal Awards Programs and State Projects
Section II — Financial Statement Findings
A. Infernal Control
None reported.
B. Compliance
None reported
Section III — Federal Awards and State Financial Assistance Findings and Questioned Costs
A. Internal Control over Compliance
Federal Awards
1C 2010.01 Subrecipient Monitoring
U.S. Department of Housing and Urban Development (HUD) —
Community Development Block Grant (CDBG)(CFDA No. 14.216)
U.S. Department of Housing and Urban Development (HUD) —
Community Development Block Grant (CDBGKCFDA No. 14.228)
r ri : OMB Circular A -133, and the subrecipient agreements, requires that a pass - through entity be
responsible for monitoring subrecipient activities and that the subrecipient is administering federal awards in
compliance with federal requirements. A control system should to in place to ensure subrecipient
monitoring activities occur on a timely basis.
Condition Monthly and/or quarterly reports were not prepared and/or submitted in a timely manner by the
subrecipients to the City. It was noted that the following reports were not submitted correctly by the
subrecipients:
• One out of twelve required monthly reports was submitted for the Miami Beach Community
Development Corporation — N. Beach Scattered Site project.
• Five out of twelve required monthly reports were submitted for the Housing Authority Rebecca
Towers N. Elevators. Additionally of the five, December 2009, January 2010, March 2010, were
submitted past their due date project.
• One out of four required quarterly reports was submitted for the Miami Beach Community
Development Corporation -- Home Ownership project.
• One out of four required quarterly reports was submitted for Miami Beach Community Development
Corporation - Rehab Rental Housing project.
• Eight out of twelve required reports were not submitted for Miami Beach Community Development
Corporation- Neighborhood Stabilization Program,
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City of Miami Beach, Florida
Schedule of Findings and Questioned Costs (Continued)
Federal Awards Programs and State Projects
Questioned costs Undeterminable.
Context We selected five of the eighteen subreciplents who received CDBG funds. See relationship of
findings to the population tested in the condition above.
gg : Subrecipients may not be administering the activities funded by the program in accordance with the
provisions of the program requirements and grant agreements which may result in repayment of awards.
Cause The City has not developed formal policies and procedures on subrecipient monitoring and report
review.
Recommendation We recommend the City establish formal policies and procedures for monitoring and
reviewing the activities of the sub - grantees of the program. A spreadsheet should be maintained for all
subrecipients to track the timely submission of the reports.
Views of responsible officials and planned corrective action Policies and Procedures were developed in
January 2011 and are being reviewed for implementation. These include moving to quarterly reporting
versus monthly reporting for all new sub recipients. Monitoring requirements for Real Estate, Housing &
Community Development (REHCD) staff is also included and staff training will be conducted once they are
finalized and implemented.
IC 2010 -02 Reporting
U.S. Department of Housing and Urban Development (HUD) —
Community Development Block Grant "CDBG" (CFDA No. 14.218)
riteri : By the 15th of each quarter, a Federal Cash Transaction Report is to be submitted to the agency.
The City must have an internal control policy In place to review each Federal Cash Transaction Report and
ensure compliance with the reporting requirements.
Condition There were no procedures in place to monitor and ensure compliance with the reporting
requirements of the CDBG Program. As a result, the required report for one quarter was submitted
approximately 5 months past due by the City to the Department of Housing and Urban Development.
Questioned costs Undeterminable.
nt : in fiscal year 2010, the City submitted the Federal Cash Transaction Report for the quarter ended
9130110 on March 2, 2011, approximately 5 months past due.
Effect City's non compliance with grant requirements may result in repayment of award monies.
Cause The City has not developed a procedure to ensure compliance requirements are being adhered to.
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City of Miami Beach, Florida
Schedule of Findings and Questioned Costs (Continued)
Federal Awards Programs and State Projects
Recommendation We recommend the City establish a formal policy and procedure to notify City
employees on pertinent due dates relating to grant awards. A tracking system should be developed to track
the timely submission of the reports.
Views of responsible officials and planned corrective action A procedure has been established which
includes the designation of responsibility for this requirement, and the inclusion of deadlines for the Federal
Cash Transaction Reports on the Division's master calendar of required reports. Additionally, staff is
reviewing current contract tracking/monitoring software options for feasibility of implementation.
IC 2010.03 Procurement & Suspension and Debarred
U.S. Department of Housing and Urban Development (HUD) —
Community Development Block Grant "CDBG" (CFDA No. 14.218)
Criteria Local governments shall use their own procurement procedures provided that they conform to
applicable Federal law and regulations and standards identified in the A -102 Common Rule, Additionally,
Non - Federal entities are prohibited from contracting with or making subawards under covered transactions
to parties that are suspended or debarred or whose principals are suspended or debarred. 'Covered
transactions" including those procurement contracts for goods and services awarded under a
nonprocurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed
$25,000 or meet certain other specified criteria.
Co ndition: In fiscal year 2010, the City did not have a system in place to verify whether vendors under
contract were suspended or debarred.
Questioned costs Undeterminable.
Context In fiscal year 2010, four of the five covered transactionstcontracts that were entered into on behalf
of the City, were not reviewed for the suspension and debarred requirement.
Eff ect: City's non compliance with grant requirements may result in repayment of award monies.
Cause The City has not developed a procedure to ensure compliance requirements are being adhered to.
Recommendation We recommend the City establish a formal policy and procedure to notify City
employees on pertinent requirements relating to grant awards and to ensure compliance requirements are
being adhered to.
Views of responsible officials and planned corrective action Policies and Procedures (PAP) were
developed in January 2011 and are under review. A procedure will be included in the PAP requiring the
confirmation and documentation by the City's sub- awardees that parties that they will contract with have
been screened by them to ensure that none have been suspended or debarred/have principals that have
been suspended or debarred, prior to the City's sub - awardee receiving any allocations of funding from the
City relating to that contracted entity.
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City of Miami Beach, Florida
Schedule of Findings and Questioned Costs (Continued)
Federal Awards Programs and State Projects
IC 2010 -04 Davis Bacon Act
U.S. Department of Housing and Urban Development (HUD) —
Community Development Block Grant "CDBG" (CFDA No. 14.218)
Criteria According to Department of Labor Regulation 29 CFR Part 5 and the OMB Circular A -110, all
laborers and mechanics employed by contractors or subcontractors to work on construction contracts in
excess of $2,000 financed by Federal assistance funds must be paid wages not less than those
established for the locality of the project (prevailing wage rates) by the Department of Labor.
Condition In fiscal year 2010, wages for three work classifications were noted to be under the Miami -Dade
County minimum requirement.
Questioned costs Undeterminable.
Context In fiscal year 2010, wages for three work classifications were noted to be under the Miami -Dade
County minimum requirement.
Effect City's non compliance with grant requirements may result in repayment of award monies.
Cause The City has not developed a procedure to ensure compliance requirements are being adhered to.
Recommendation We recommend the City establish a formal policy and procedure to notify City
employees on pertinent requirements relating to grant awards and to ensure compliance requirements are
being adhered to.
Views of responsible officials and planned corrective action Policies and Procedures (PAP) were
developed in January 2011 and are being reviewed for implementation. The PAP will delineate the
requirements for the monitoring of construction projects and establishes criteria for use by contract monitors
to ensure compliance with all federal requirements, Including the Davis -Bacon Act.
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City of Miami Beach, Florida
Schedule of Findings and Questioned Costs (Continued)
Federal Awards Programs and State Projects
State Awards
IC 2010.05 — Subrecipient Monitoring
Florida Department of Environmental Protection
State Housing Initiatives Partnership "SHIP" (CFSA No. 52.901)
rileria; Florida statutes, Sections 420.907 through 420.9079 over the SHIP grant and Chapter 67- 37.007
Florida Administrative Code, stipulates that a pass - through entity is responsible for monitoring subrecipient
activities and that the subrecipient is administering state awards in compliance with state requirements. A
control system should be In place to ensure subrecipient monitoring activities occur on a timely basis.
Condition There were no procedures in place to monitor and ensure compliance with the subrecipient
requirements of the SHIP Program. As a result, monthly reports were not prepared and or submitted in a
timely manner by the subrecipient, Miami Beach Community Development Center, to the City as required by
the subrecipienfs agreements.
Questioned costs Undeterminable.
Context In fiscal year 2010, there was one subrecipient who received SHIP funds. We tested the one
subrecipient and noted for the months of January, February, April, July, and August of 2010 the reports
were submitted past the due date of 10 days after month end.
E_ffrPC . Subrecipients may not be administering the activities funded by the program in accordance with the
provisions of the program requirements and grant agreements which may result in repayment of awards.
Cause The City has not developed a formal policy and procedures on subrecipient monitoring and site visit
review.
Recommendation We recommend the City establish a formal policy and procedure for monitoring and
reviewing the activities of the sub - grantees of the program. A spreadsheet should be maintained for all
subreciplents to track the timely submission of the reports.
Views of responsible officials and planned corrective action Policies and Procedures (PAP) were
developed in January 2011 and are being reviewed for implementation. The PAP will delineate the
requirements for contract monitoring. In addition, staff is reviewing current contract tracking software options
for feasibility of Implementation to assist in tracking compliance requirements.
However, it should be noted that the Florida Housing Program Administration Manual, which are the rules
for the SHIP program, does not require monthly or quarterly reporting from sub - recipients, only the
submission of an annual report by the City to the State. However, the City's Fiscal Year 200912010 contract
with the City's sub - recipient required quarterly status reports containing information derived from each
reimbursement request submitted by the sub - recipient.
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City of Miami Beach, Florida
Schedule of Findings and Questioned Costs (Continued)
Federal Awards Programs and State Projects
IC 2010.06 — Reporting
Florida Department of Environmental Protection
State Housing Initiatives Partnership "SHIP" (CFSA No. 52.901)
Criteria Each county of eligible municipality shall submit to the Florida Housing Finance Corporation
(FHFC) by September 15 of each year a report of its affordable housing programs and accomplishments
through June 30th. The City must have an internal control policy in place to review each housing project
and ensure compliance with the reporting requirements.
Condition There was no procedure in place to monitor and ensure compliance with the reporting
requirements of the SHIP Program. As a result, the required report was submitted two days late by the City
to FHFC.
Questioned costs Undeterminable.
Context In fiscal year 2010, the City submitted the Annual Report for fiscal years 2007 -2008, 2008-2009,
and 2009 -2010 on September 17, 2010, two days past due.
Effect City's non compliance with grant requirements may result in repayment of award monies.
Cause The City has not developed a procedure to ensure compliance requirements are being adhered to.
Recommendation We recommend the City establish a formal policy and procedure to notify City
employees on pertinent due dates relating to grant awards. A tracking system should be developed to track
the timely submission of the reports.
Views of responsible officials and planned corrective action The annual SHIP report was sent on the due
date, September 15, 2010, via electronic correspondence to Florida Housing Finance Corporation, but was
not accepted as a timely submission due to the new online submission requirement. A procedure and new
time -line has been established and calendared to complete and file the annual SHIP report as required by
program rules. This procedure will be memorialized in the Policies and Procedures manual.
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City of Miami Beach, Florida
Schedule of Findings and Questioned Costs (Continued)
Federal Awards Programs and State Projects
B. Compliance Findings
Federal Awards
CF 2010 -01 Reporting
U.S. Department of Housing and Urban Development (HUD) —
Community Development Block Grant "CDBG" (CFDA No. 14.218)
See IC 2010-02
Views of responsible officials and planned corrective actions See IC 2010 -02 for detailed view of
responsible officials and planned corrective action.
CF 2010 -02 Davis Bacon
U.S. Department of Housing and Urban Development (HUD) —
Community Development Block Grant "CDBG" (CFDA No. 14.218)
See IC 2010 -04
Views of responsible officials and planned corrective actions See IC 2010 -04 for detailed view of
responsible officials and planned corrective action.
State Financial Assistance
CF 2010 -03 — Reporting
Florida Department of Environmental Protection
State Housing Initiatives Partnership "SHIP" (CFSA No. 52.901)
See IC 2010-06
Views of responsible officials and planned corrective actions See IC 2010-06 for detailed view of
responsible officials and planned corrective action.
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City of Miami Beach, Florida
Schedule of Prior Year Audit Findings
Federal Awards Programs and State Projects
Finding 0 Finding Title status Explanation
Findings related to financial statements:
CF 200901 Subrecipient Monitoring (CFDA No.14218)
Monthly reports were not prepared andlor Not Corrected The City agrees that formal policies and procedures
submitted in a timety manner by the sub recipients for monitoring and reviewing activities are necessary.
to the City as required by the subrecipient The City corxurs that a formal process must be
agreements. In addition, no evidence of implemented for monitoring visits and other program
monitoring visits were found in several compliance. The City is currently undergoing a
subrecipienl's files. review of all files and developing monitoring tools for
each subrecipient file which will document
responsibilities , contract deliverables, and deadlines.
Furthermore, The City Is in the process of notifying all
subrecipients that failure to file monthly reports is a
default under their contracts.
CF 2009.02 Earmarking (CFDA No. 14218)
There was no procedure in place to monitor and Corrected The City corrected the specific finding in fiscal year
ensure compliance with the earmarking 2009.
requirements of the CDBG Program, therefore, the
City exceeded the allotted amount during fiscal
year 2009.
CF 2009 -03 Special Test (CFDA No.14.218)
An environmental review was not completed for the Corrected The City corrected the specific finding in fiscal year
Mami Beach Community Development 2009.
Corporation — Allen House Apartments.
CF 200904 Subrecipient Monitoring (CFDA No.14.239)
Monitoring of subrecipent activities was not Corrected The City corroded the specific finding in fiscal year
conducted during fiscal year 2009 for the Miami 2009•
Beach Community Development Center —
Community Housing Development Organization.
CF 2009 -05 Reporting (CSFA No. 55.901)
There was no procedure in place to monitor and corrected The City corrected the specific finding in fiscal year
ensure compliance with the reporting requirements 2009.
of the SHIP Program. As a result, the required
report was submitted forty -nine days late by the
City to FHFC.
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City of Miami Beach, Florida
Schedule of Prior Year Audit Findings
Federal Awards Programs and State Projects (Continued)
CF 200906 Special Test (CSFA No. 55.901)
There was no procedure in place to monitor and Corrected The City corrected the specific finding in fiscal year
2009,
ensure compilance with the earmarking
requirements of the SHIP Program. As a result,
the City did no( meet any of the required
earmarking requirements during fiscal year 2009
for the closing year of fiscal year 20015-2007.
CF 200907 Submelpient Monitoring (CSFA No.55.901)
Corrected The City corrected the specific finding in fiscal year
There was no procedure in place to monitor and 2009.
ensure compliance with the subrecipient
requirements of the SHIP Program. As a result,
monthly reports were oot prepared and or
submitted in a timely manner by the subrecipient,
Miami Beach Community Development Center, to
the City as required by the subreciplenfs
agreements. Additionally, monitoring of
subrecipenl activities was not conducted during
fiscal year 2009 by the City.
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City of Miami Beach, Florida
Management Letter in Accordance with the Rules of the
Auditor General of the State of Florida
September 30, 2010
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Contents
Management Letter in Accordance with the
Rules of the Auditor General of the State of Florida 1-2
Appendix A — Current Year's Recommendations to Improve Financial Management,
Accounting Procedures and Internal Controls 3 -4
Appendix B — Prior Year's Recommendations to improve Financial Management,
Accounting Procedures and Internal Controls 5
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McGladray
Management Letter in Accordance with the
Rules of the Auditor General of the State of Florida
To the Honorable Mayor and City Commissioners
City of Miami Beach, Florida
We have audited 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 of the City of
Miami Beach, Florida (the "City') as of and for the year ended September 30, 2010, which collectively comprise the
City's basic financial statements, and have issued our report thereon dated March 30, 2011. Our report was modified
to include a reference to other auditors.
We conducted our audit in accordance with auditing standards generally accepted in the United States of America;
the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller
General of the United States; and OMB Circular A -133, Audits of States, Local Governments and Non-profit
Organizations. We have issued our Independent Auditor's Report on Internal Control over Financial Reporting and
on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with
Government Auditing Standards dated March 30, 2011, and Independent Auditor's Report on Compliance with
Requirements Applicable to Each Major Federal Program and State Project and on Internal Control over Compliance
and Schedule of Findings and Questioned Costs dated March 30, 2011. Disclosures in those reports and schedule
should be considered in conjunction with this management letter.
Additionally, our audit was conducted in accordance with the provisions of Chapter 10.550, Rules of the Auditor
General, which governs the conduct of local governmental entity audits performed in the State of Florida. This letter
includes the following information, which is not included in the aforementioned auditor's reports or schedule:
Section 10.554(1)(i) 1., Rules of the Auditor General, requires that we determine whether or not corrective actions
have been taken to address findings and recommendations made in the preceding annual financial audit report.
Corrective actions have been taken to address findings and recommendations made in the preceding annual
financial audit report, except for those reported below under the heading 'Prior Year's Recommendations to Improve
Financial Management, Accounting Procedures and internal Controls' listed in Appendix B.
Section 10.554(1)(1)2., Rules of the Auditor General, requires our audit to include a review of the provisions of Section
218.415, Florida Statutes, regarding the investment of public funds . In connection with our audit, we determined that
the City complied with Section 218.415, Florida Statutes, relating to local government investment policies.
Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address in the management letter any
recommendations to improve financial management The recommendations to improve the City's financial
management have been addressed in Appendix A — Current Year's Recommendations to Improve Financial
Management, Accounting Procedures and Internal Controls to this report.
McGladray Is the brawn under whldr ASM McGladray, kw:. and MtGladray 6 Pullen, LLP serve c1 ents' business needs. Member of ASIA International network a network of
The two firms operstIN a separate legal entitles In an afternadve Practk:a stnxture. Indspeodent accoantlrp, tax and ummIting Arms
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Section 10.554(1)(i)4., Rules of the Auditor General, requires that we address violations of provisions of contracts or
grant agreements, or abuse that have occurred, or are likely to have occurred, that have an effect on the financial
statements that Is less than material but more than inconsequential. In connection with our audit, we did not have any
such findings.
Section 10.554(1)()5., Rules of the Auditor General provides that the auditor may, based on professional judgment,
report the following matters that have an inconsequential effect on financial statements, considering both quantitative
and qualitative factors: (1) violations of provisions of contracts or grant agreements, fraud, illegal acts, or abuse, and
(2) deficiencies in internal control that are not significant deficiencies. In connection with our audit, we did not have
any such findings.
Section 10.554(1)(i)6., Rules of the Auditor General, requires that the name or official title and legal authority for the
primary government and each component unit of the reporting entity be disclosed in this management letter, unless
disclosed in the notes to the financial statements. The information is disclosed in Note 1A to the financial statements.
Section 10.554(1)(1)7.a., Rules of the Auditor General, requires a statement be included as to whether or not the local
governmental entity has met one or more of the conditions described in Section 218.503(1), Florida Statutes, and
Identification of the specific condition met. In connection with our audit, we determined that the City did not meet
any of the conditions described in Section 218.503(1), Florida Statutes.
Section 10.554(1)(i)7.b., Rules of the Auditor General, requires that we determine whether the annual financial report
for the City for the fiscal year ended September 30, 2010 filed with the Florida Department of Financial Services
pursuant to Section 218.32(1)(a), Florida Statutes, is in agreement with the annual financial audit report for the fiscal
year ended September 30, 2010. In connection with our audit, we determined that these two reports were In
agreement.
Pursuant to Sections 10.554(1)(i)7.c. and 10.556(7), Rules of the Auditor General, we applied financial condition
assessment procedures. It is management's responsibility to monitor the City's financial condition, and our financial
condition assessment was based in part on representations made by management and the review of financial
information provided by same.
Pursuant to Chapter 119, Florida Statutes this management letter is a public record and Its distribution is not limited.
Auditing standards generally accepted in the United States of America require us to indicate that this letter is
intended solely for the information and use of the Honorable Mayor, City Commissioners, management of the City,
the State of Florida Office of the Auditor General, federal and state awarding agencies, and pass- through entities,
and is not intended to be and should not be used by anyone other than these specified parties.
Miami -Dade County, Florida
March 30, 2011
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Appendix A
Current Year's Recommendations to Improve Financial Management,
Accounting Procedures and Internal Controls
Year Ended September 30, 2010
No. Current Year's Observations
2010 -1 Self- Insurance Fund Deficit and
Actuarial discount rate of the
Self- Insurance Program
2010 -1 Self- Insurance Fund Deficit and Actuarial discount rate
riteria: Proprietary funds (which include internal service funds) should be accounted for on a cost reimbursement
basis. Also, actuarial assumptions used to estimate the City's self insurance liability should be reasonable and reflect
current market related conditions.
Condition The City's self- insurance fund reported a net asset deficit of approximately $7.0 million, as of
September 30, 2010. Additionally, it was noted, it may not be appropriate for the City to use a 5% rate for
discounting the loss reserves, since the City's self - insurance fund has no assets and does not earn any investment
income.
Cause The rates established to charge each participating fund of the City were not adequate enough to reimburse
the cost of insurance.
Eff&, The City's may not have enough resources accumulated to fully liquidate Insurable liabilities as they become
due. In addition, by not properly allocating these charges to the various funds and functions, the City might not
incorporate all of the City's cost that would be applicable In order to accurately establish rates and fees for services
that are charged by the City to external parties.
Recommendation We recommend that the City evaluate its self- insurance program, to not only help ensure that the
level of amounts charged to user funds are sufficiently balanced to sustain the self- insurance program, but to help
ensure that reserves will be replenished In order to fund the deficit. The total charge by the internal service fund to
the other funds should be based on a systematic method and adjusted over a reasonable period of time so that
internal service fund revenue and expenses are approximately equal.
Views of responsible officials and planned corrective actions The deficit in the Risk Management self insurance fund
decreased from $8.985 million at September 30, 2009 to $6.811 million at September 30, 2010, a decrease of
$2.174 million. It is the City's intention to continue to increase revenues and thus reduce the deficit in future years. In
addition, the City considers, subject to commission budget approval, an annual contribution to reduce the Fund's
deficit.
As with all other local governments, Fiscal Year 2010 was a difficult budget year, as is Fiscal Year 2011.
Furthermore, Fiscal Year 2012 is expected to be even more challenging due to continued declines in property values
through January 2011 and increased pension contribution requirements primarily because pension investments have
not met actuarial assumptions in the last two years. As a result, for the short -term, the City has elected to use year-
end surplus in the General Fund as carry- forward to future fiscal years, rather than to fund deficit increases in the self
Insurance fund. It is anticipated that property values will stabilize in the coming years and then resume normal
historical increases and that investment returns will return to historical levels, thereby reducing the stress on the
budget. It is therefore anticipated that in the longer term, the City will once again be in the position to reduce the risk
deficit as it has done in prior years.
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City of Miami Beach, Florida
Appendix A
Current Year's Recommendations to Improve Financial Management,
Accounting Procedures and Internal Controls (Continued)
Year Ended September 30, 2010
In FY 2010 the City decreased the rate for discounting loss reserves from 6% to 5% and plans to further decrease it
to 4% in FY 2011. At September 30, 2010, the City had $13.989 million In IBNR liabilities and $9,850 million in
pending insurance claims liabilities. We feel that this is sufficient to liquidate any Insurable liabilities that become
due.
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City of Miami Beach, Florida
Appendix B
Prior Year's Recommendations to Improve Financial Management,
Accounting Procedures and internal Controls
Year Ended September 30, 2010
Observation is Comment No
No. Prior Years' Observations SHIT Relevant Longer Relevant
2009 -1 Complexity of Passwords X
2009 -3 Budget Compliance X
2002 -2 Self- Insurance Fund Deficit X
see current years comment at 2010 -1
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Exhibit 2 - Audit Areas
412
Exhibit 2 — Audit Areas for FY2010/11
CITY OF MIAMI BEACH
INTERNAL AUDIT DEPARTMENT
Audit Areas
Areas highlighted are considered for audit based on projected frequency. Comments provided indicate reasons why area
may not be audited within the projected frequency.
Last Risk
Department - Audit Area Audit Type Comments
Mayor and City Commission
O erations : a s % % = =:r L
Administrative Support Services
Ci Manage Office
O erations L
Communications ' 2';' L
Bud et & Performance Improvement
Management & Budget L Annual budget has been presented to GFOA and
earned their Distinguish Budget Award, and
audited b extemal auditors.
L Grants are included in the City's single audit by
Grants Management
the City's external auditors.
Finance
Cashier Functions - Central Cashier 2008 H
Cashier Functions - Other areas Building, Police, 2008 M
Parkin
City Payment Processing 2009 H
Fixed Assets 2009 H
Interfund Transfers (includes management fees for ij }: % {?;a;x %e ° ;'t M City's external auditors review the internal controls
Convention Center, Parking, Sanitation, Storm, of these financial areas annually within the scope
Sewer, Internal Service, Resort Tax)sz of their comprehensive financial audit of the city.
Intergovernmental Rev ( S/Tax, Gas Tax Motor M While this does not constitute a detailed internal
Fuel ) audit, the controls are being reviewed. The City
Miscellaneous Revenues to include the following; L has a consultant study underway to update the
Road Impact Fee reimbursement, Beach Access basis of determination for management fees.
Accumulated Leave Liability 2011 L
Business Tax Receipts / Certificate of Use 2008 M
Communication Service Tax 2009 M Previously Franchise Cable & Utility Tax -
Tele hone
Franchise Fees & Utility Taxes - Electric 2009 M
Franchise Fees & Utility Taxes - Gas 2009 M
Investments % ?ai,9 ° i ii;:% M Strong investment policy and oversight by
investment advisor.
Lien Letter Fees 'a ° %' ,:i si L
Payroll Processing 2008 H
Resort Tax Operations f c z L Audits of resort tax business are under the
F ^:^ 3 internal audit function. Daily contact with this
Finance section keeps Audit Division informed.
Storm Water Fee Billing 2011 M
Water and Sewer Billings 2011 H
Audit Areas 2011 Final 1 01/04/2012
413
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Exhibit 2 - Audit Areas for FY2010/11
CITY OF MIAMI BEACH
INTERNAL AUDIT DEPARTMENT
Audit Areas
i
Areas highlighted are considered for audit based on projected frequency. Comments provided Indicate reasons why area j
may not be audited within the projected frequency.
Last Risk
Qeoartment - Audit Area Audi Tvae Comments
Procurement
O erations 2011 H
Public Auctions / Sale of Surplus Property 2010 M
Information Technolo
Operations (Applications, Support, Communications '• - ; M Each year, external auditor reviews internal
Services
:r controls over IT functions in their annual audit.
IT Securi contract recommended H
Inventory ^? L
Human Resou
Operations includes Labor Relations ;' ; ta: L
Review of Benefits Formulas 2005 L
Pension Time Purchased by Leave Hours 2008 L
Health Dental and Life Insurance 2010 1 L
Risk Management
Workers Compensation iio :> M
General Liability Insurance 2005 L
Ci Clerk
Operations, Record Retention / Public Requests 2011 L
Special Masters 2010 M
Election Invoices 2008 L
Central Services
Invento 2003 L
[ Operations / Billings for Department Services 2009 L
City Attorne
O erations " L
Economic Dev. & Cultural Events
Economic Development
Economic Development
Anchor Shop Retail / Garages 2010 L
RDA - Administrative &Operations L
Asset Management
Beachfront Concession Boucher Brothers 2011 L
City Leases, Historic City Hall, 777 Building, etc. 2010 M Historic City hall under renovation through 2008.
Colony Theater Restaurant Agreement 2008 L Reviewed RFP
Ballet Valet Company Lease Agreement 2010 L
Vending Machines s ;; " M Contract calls for annual certified statement of
s�3 revenue. Audit reviewed 2008 year revenues in
s's jz 4/2009.
Penrods Pier Park 2009 L
Miami Beach Marina 2010 L
South Pointe Restaurant Smith & Woilens 2009 L
State Beachfront Management Agreement 2011 L Required Annually by State Agreement
Market Places Concession Agreement 2005 L
Audit Areas 2011 Final 2 01/04/2012
414
i
Exhibit 2 — Audit Areas for FY2010/11
CITY OF MIAMI BEACH
INTERNAL AUDIT DEPARTMENT
Audit Areas
Areas highlighted are considered for audit based on projected frequency. Comments provided indicate reasons why area
may not be audited within the projected frequency.
Last Risk
Department - Audit Area Audit Type Comments
Buildin
Operations 2009 H Outside Consultant completed an organizational
review and operations analysis of the Building
Depart ent in 2009.
Master Building Permit Fee 2008 H
Other Building Fees - Electrical, Plumbing, "t' f %:" H Building Development Process Fee Study
ji•s ; i ; eq #;
Mechanical, Training, Elevator Inspections, completed in 2009. Procurement of new permitting
Recertification, Demolition, Building Code Ili�''' system in 2009.
Violations, Expired Permits,
Certificate of Completion / Occupancy ?p H
Plannin
Operations e s -� L
Plans Review, Application Fees L Building Development Process Fee Study
completed in 2009. Procurement of new permitting
stem in 2010
Concurrency Fees 2011 M
, Parking Impact fees 2010 L
Tourism & Cultural Development
Special Events 2011 L
Byron Carl le "la'•i'Z4::f'si L
Bass Museum Operation : ': ° -' L Expenditure audit, minimum risk. Analysis of
i 2
v 4;� revenues and operations was done in 2003 for
Friends of the Bass Audit
Cultural Arts Council 2011 L Required Annually by City Code
Convention Center Management Contract / 2008 M Close -out audit of SMG contract
Revenues - Rents & leases, Concessions,
Telephones, Electrical, Services
Convention Center Food & Beverage/Centerplate 2009 M
Convention Development Tax %: $s * E • L County audit completed in 2008.
Operations
Code Compliance
Code Enforcement Violations and Operations 2010 1 H Code Compliance system being procured in 2010.
C mmunity Services
Community Services Ijl''' iti: L
Homeless Outreach Services jf;r fir? L
Housing & Community Development
CDBG grants i' M Department is reviewed periodically by the State
Home Investment Partnerships (HOME Entitlement) ��� M of Florida and HUD.
State Housing Initiatives Part (SHIP) Programs ; M
Audit Areas 2011 Final 3 0110412012
415
Exhibit 2 — Audit Areas for FY2O1O/11
CITY OF MIAMI BEACH
INTERNAL AUDIT DEPARTMENT
Audit Areas
Areas highlighted are considered for audit based on projected frequency. Comments provided Indicate reasons why area
may not be audited within the projected frequency.
Last Risk
Department - Audit Area Au It Type Comments
Parks and Recreation
Golf Management Agreement Miami Beach Golf 2010 M
Golf Management Agreement Normandy Shores 2010 M Course under renovation, completion in FY
2008!09.
Greens ace Management %iz%:% L
Landscaping Agreements 2010 M Contracts are effectively monitored by Parks
Greenspace Mgmt and Procurement. Results are
shared with Internal Audit.
Overtime Parks & Recreation 2010 M
Recreation fees / Cashier functions 2010 M
Tennis Centers Agreement 2010 L
Public Works
Administration / Engineering L
Bus Shelter / Lincoln Road Directories 2009 M
Environmental Resource Mana ement =10 's' L Area considered minimum risk.
Inventory Public Works 2011 M
Inventory Processing 2009 M
Operations - Sewer M Various operational components were reviewed in
Operations - Storm Water 2011 M conjunction with reimbursement requests made
Operations - Streets, Street Lights L for prior hurricanes.
Operations - Water ` •' M
Overtime Public Works 2010 1 M
Permit Fees - News Racks L
Permit Fees - Work in Right of Way 2011 L
Permit Fees - Sidewalk E :> ss: i:,< L
Purchasing - Public Works 2009 M
Transportation Management °it L
Water & Sewer Impact Fees 1 2011 L
S anitation
Operations ;13 L Worked with department management on
hurricane debris and roll -offs last four years, no
I „t.
problems noted.
Waste Franchise Fees 2009 M Audited four contractors
Sanitation Fee Residential Billing 2011 M
Sanitation Impact Fees (Construction & Commercial 2011 M
Billings
Fines & Forthwiths Sanitation 2011 L
Roll -Off Franchise Fees 1 1 2010 1 H lContinuous audits. Completed 8 audits in 2010.
Property Management
Maintenance A reements 2008 M
Internal Service Charge Billings Includ ng CAM 2010 M
Inventory (Property Management) 2009 L
Ca Ital Im rovement Projects
Finandal Controls & Operations H
Audit Areas 2011 Final 4 01104/2012
416
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Exhibit 2 - Audit Areas for FY2010/11
CITY OF MIAMI BEACH
INTERNAL AUDIT DEPARTMENT
Audit Areas
Areas highlighted are considered for audit based on projected frequency. Comments provided indicate reasons why area
may not be audited within the projected frequency.
Last Risk
Department - Audit Area Audit Type Comments
Parkin
Attended Parking Lots Monitoring 2011 H Completed 4 reviews during the year.
Boat Show Parking 2008 M
Cashiers & Attendants Agreement Parkin 2010 M As of 8/2009 audit required annually.
Coin Room (Monitoring) Meter Collection 2011 H Completed 4 reviews of coin room during the year.
County Court Fines Parking 2003 L
Meter Collection Agreement 2009 M
Parking Debit Card /In Car Meters 2010 M
Parking Enforcement Reviews (Meters) 2011 H Continuously monitored throughout year. 24
se pa reviews performed.
Parking Permits Non - Revenue 2011 L
Parking Permits Revenue 2007 M
Space Rentals - Meters 2008 M
Space Rentals - Parking Garages 2009 M
Towin Fees - Parking Department 2009 L
Valet Parking Agreement (Gold Star) 2011 M
Fleet Mana ement
Fuel distribution 2009 M
Inventory & Processing 2010 L
Operations/ Internal Service Charges Billings 2011 L
Vehicle Purchases 2007 L Audited vehicle purchasing process.
Public Safety
Po lice
County Court Fines - Traffic -i¢i • ; ; ; L Follow -up audit preformed 10/2003, no exceptions
{;s's were noted.
False Alarm/Registration '$i; psi% L Internal Audit assisted police in reviewing new
procedures for false alarm. Police in process of
obtaining new software for operations
Forfeited Funds - Federal 2006 L
Forfeited Funds - State 2011 L
Off Duty Account Police 2009 M
Official Authorized Funds - Criminal Investigation 2007 L
Unit CIU
Official Authorized Funds - Strategic Investigation 2007 L
Unit SIU
Operations - (Patrol, Criminal Investigation, Support i s i L
Services & Technical Services) K'sjE`
Overtime Police 2009 H
Property Evidence Unit Police 2009 M
Towin Fees Police 2009 L
Audit Areas 2011 Final 5 01/04/2012
417
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Y
S
Exhibit 2 — Audit Areas for FY2010/11
CITY OF MIAMI BEACH
INTERNAL AUDIT DEPARTMENT
Audit Areas
i
i
Areas highlighted are considered for audit based on projected frequency. Comments provided indicate reasons why area
may not be audited within the projected frequency.
Last Risk
Department - Audit Area Audit Type Comments
Fire
Annual Fire Inspection Fees ,; , ,,, ? %z %z -• L Building Development Process Fee Study
completed in 2009. Procurement of new permitting
•�;
?e a r;:ze system in 2009.
Fire Code Violations L
Fire Plan Review
µ L Building Development Process Fee Study
r va completed in 2009. Procurement of new permitting
system in 2009.
Fire Rescue Fees 2008 M
Ocean Rescue O rations .' ? L
Off Du Account Fire 2008 M
Fire Prevention L
Operations (Suppression, Rescue, Support sz = =e z;,h% L
Services, ?
Overtime - Fire including Ocean Rescue 2010 M
Citywide Projects
Capital Projects - Non -CIP (Public Works, Parks, b' e?eie =% H
RDA, Convention Center, Etc.)
Non - Profit Organizations
CDBG funding source:
American Veteran News c _; ?j'r" rs'`•l , L CDBG funding reviewed by City Econ Dev.
ASPIRA of South Florida c 3 ": ai s='ci; L Periodically reviewed by Federal HUD. Areas
Food for Life Network c s, "i'e" "_ L reviewed by external auditors through the Single
HIV Education law Project HELP c 3 % _% L Audit Report under OMB Circular A -133.
HOPE INC c '' e ? %' L
Little Havana Activities and Nutrition Center c r ? ; s i?e ? #: L
Miami Beach Adult Community Education Center c e" ?e'zs e ? % ?•z ?e L
Miami Beach CommunitTDevelopment Corp c 2009 L
Montessori Academy at St. John's c s ?sze?r ?0 L
Prime Time Seniors c i'; ; L
RAIN Parents Inc. c r • . y? L
Shelboume House c ; 0 : L
Unidad of Miami Beach Inc. c "�Y= L
General fund funding source:
Douglas Garden Community Mental Health Center q L General fund for 2012 is $21
Jewish Vocational Services -Hot Meals =s % ?v = L General fund for 2012 is $46,930
Latin Chamber of Commerce 9 2006 L General fund for 2012 is $18,000.
MDPL -10th St auditorium 9 ?e ?e; a =e : ? #; L General fund for 2012 is $22,500.
Miami Beach Botanical Gardens 2011 L General fund for 2012 is $137,228.
Miami Beach Chamber of Commerce 19 2008 L General fund for 2012 is $36,000.
Sanford L. Ziff Jewish Museum I o3 s '(? :Iii �. L General fund for 2012 is $49
Sister Cities # L I General fund for 2012 is $13,680.
South Florida & Greater Miami Hispanic IQ 1 2008 1 L I General fund for 2012 is $18
Both general fund and CDBG funding source:
Boys and Girls Club lgc 1 2010 L General Fund for 2012 is $16,606.
Miami Beach Community Health Center < L General Fund for 2012 is $21,660.
North Beach Development Corp Jgc 1 2008 1 L lGeneral Fund for 2012 is $18,000.
Other fundin sources:
Friends of the Bass lo I 2003 L
Police Athletic League lo 1 2009 1 L
Audit Areas 2011 Final 6 01104/2012
418
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Exhibit 3 — Summary of Internal Audit Activities
419
Summary of Internal Audit Activities for Fiscal Year 2010/11
Internal Audits - Available On Line
Cultural Arts Council
First Class Parking, LLC Valet Parking Operational Audit - Art Basel 2010
Internal Audits - Pending Final Reports
Accumulated Leave Liability
Special Events Fees
State Beachfront Management Agreement
Boucher Brothers Miami Beach, LLC Beachfront Concession Agreement
Concurrency Mitigation Fees
Non - Revenue Municipal Parking Permits
State Forfeited Funds
Public Works Department's Warehouse Inventory
Sanitation Fees Residential Billing and Service Agreement
Sanitation Impact Fees
Sanitation Fines and Forthwiths
Storm Water Review
Water and Sewer Billings
Water and Sewer Impact Fees
Procurement Division Operations
City Clerk Operations
Fleet Management Division - Internal Service Charge Billings
Public Works Right of Way Permit Fees
Miami Beach Gardens Conservancy — Management Agreement
For fiscal year 2010/11 internal audits to date included the following recommendations:
• Additional safeguards over inventory processing for areas of Public Works;
• Revisions to update several departmental procedures and improve controls for
Sanitation, Procurement and City Clerk offices;
• Changes in procedures to comply to reporting requirements of approved grant funds
distributed by the Cultural Arts Council;
• Improve internal control processes and clarification of charges for Water and Sewer
Impact Fees, Sanitation Impact Fees, Concurrency Mitigation Fees, Public Works
Right of Way Permit Fees, Special Event Fees and Sanitation Fines;
• Improve process and verification of charges for Water and Sewer, Storm water, and
Sanitation Residential billings;
• Strengthen oversight of compliance to the Beach Concession agreement;
• Improvement of internal controls over Fleet Division internal service charges; recording
and processing State Forfeited Funds;
• Improve controls over donated leave and leave buy -back provisions;
• Confirmation of funds forwarded to Miami Beach Conservancy to be used for proper
I agency purpose and recommendations for improvement in internal controls;
• Verification of performance of valet parking operations and attended lots, and
compliance with Parking Department procedures for Non - Revenue parking Permits.
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Parking Monitoring Reviews
In the Parking area, the Division completed twenty -four meter, four attended lot cash operations
and four coin room reviews during the past fiscal year. While our parking meter reviews
identified an improvement in enforcement over the previous fiscal year, areas of enforcement
still fell short of desired benchmarks. Operational procedures for attended lots were found to
comply with the city's guidelines. In addition, coin room operations were functioning in
accordance the city's procedures.
Sanitation Audits
In FY 2006/07 our part time position was expanded to a fulltime position dedicated to monitoring
and auditing waste haulers. This effort led to the issuance of seven audit reports in fiscal year
2010/11 resulted in $41,744 of audit assessments
Other Support
Additional support was directed to performing non -audit activities.
• Assistance was provided for Cleanliness Assessment Program
• Input of Daily Assessment results.
• Preparation of Quarterly reports.
• Testing new automated assessment system and reports.
• Hurricane related grant monitoring responsibilities for the past fiscal year included:
• Assisting FEMA and the State with their ongoing closeout for Hurricane Wilma 2005.
• Preparation of Quarterly Reports to FEMA (still ongoing for Hurricane Wilma projects).
• Monitoring each open project for completion and requested reimbursement.
• Assisting Office of Inspector General with audit of FEMA funding received for
Hurricanes Katrina and Wilma.
Additional monies recovered during the past fiscal year for these claims amounted to $260,777
for Hurricane Wilma. Additional funds are pending as projects are completed. We anticipate
that in fiscal year 2011/12 additional time will be spent on completing the request for payments
and final closeouts for the 2005 storms.
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