C2B-Issue RFP Auditing Services To Examine The City�s Basic Financial StatementsCOMMISSION ITEM SUMMARY
Condensed Title:
Request for approval to authorize the issuance of a request for proposals (RFP) for auditing
services to examine the City of Miami Beach (the City) basic financial statements included in
the City's Comprehensive Annual Financial Report (CAFR), federal grant programs and state
projects (OMB A-133 single audit), the Miami Beach Redevelopment Agency's basic financial
statements (RDA), the Parking Systems Fund's (PSF) financial statements, the Miami Beach
Visitor and Convention Authority's (VCA) financial statements, the Miami Beach Convention
Center's financial statements, the Building Better Communities bond program (BBC) the
Children Trust grant program (CT), and the Safe Neighborhood Parks and bond program
(SNP).
Key Intended Outcome Supported:
Improve the City's overall financial health and maintain overall bond rating.
Supporting Data (Surveys, Environmental Scan, etc.): N/A
Issue: I Should the City Commission approve the issuance of a request for proposal for auditing services?
Item Summary/Recommendation:
The purpose of the audit is to examine the City's Basic Financial Statements included in the
City's Comprehensive Annual Financial Report (CAFR). The engagement shall also include the
Single Audit, PSF, VCA, Convention Center, BBC, CT and SNP audits, for a period of up to five
(5) years at the option of the City.
The original engagement will be for the fiscal year ending September 30, 2012. Additional
years of the engagement or additional auditing services would be subject to the approval of the
Audit Committee and confirmation by the City Commission annually.
The Administration recommends that the Mayor and Commission authorize the issuance of the
RFP for auditing services.
Amount
Source of Funds:
OBPI
Total
Cit Clerk's Office Le islative Trackin
Department Director
T:\AGENDA\2012\3-21-12\ RFP for audit services memo
C9 MfAMlBEACH
19,2012
Manager
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Account Approved
City Manager
JMG
AGENDA ITEM c;;;. B
DATE 3-~/-/2-
MIAMI BEACH
City of Miami Beach, 1700 Convention Center Drive, Miami Beach, Florida 33139, www.miamibeachfl.gov
TO:
FROM:
DATE:
SUBJECT:
COMMISSION MEMORANDUM
Mayor Matti H. Bowerand Members of the City Commission
Jorge M. Gonzalez, City Manager ~
March 21,2012 U U
REQUEST FOR APPROVAL TO AUTHORIZE THE ISSUANCE OF A REQUEST
FOR PROPOSALS (RFP) FOR AUDITING SERVICES TO EXAMINE THE
CITY'S BASIC FINANCIAL STATEMENTS INCLUDED IN THE CITY'S
COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR), FEDERAL GRANT
PROGRAMS AND STATE PROJECTS (OMB A-133 SINGLE AUDIT), THE
MIAMI BEACH REDEVELOPMENT AGENCY'S BASIC FINANCIAL
STATEMENTS (RDA), THE PARKING SYSTEMS FUND'S (PSF) FINANCIAL
STATEMENTS, THE MIAMI BEACH VISITOR AND CONVENTION
AUTHORITY'S (VCA) FINANCIAL STATEMENTS, THE MIAMI BEACH
CONVENTION CENTER FINANCIAL STATEMENTS, THE BUILDING BETTER
COMMUNITIES BOND PROGRAM (BBC) THE CHILDREN TRUST GRANT
PROGRAM (CT), AND THE SAFE NEIGHBORHOOD PARKS AND BOND
PROGRAM (SNP).
ADMINISTRATION RECOMMENDATION
Authorize the issuance of the RFP.
ANALYSIS
The purpose of the audit is to examine the City's Basic Financial Statements included in the
City's Comprehensive Annual Financial Report (CAFR). The engagement shall also include
the Single Audit, PSF, VCA, Convention Center, BBC, CT and SNP audits, for a period of up
to five (5) years at the option of the City.
The original engagement will be for the fiscal year ending September 30, 2012. Additional
years of the engagement or additional auditing services would be subject to the approval of
the Audit Committee and confirmation by the City Commission annually.
SCOPE OF SERVICES
There are ten services which are required as part of this request for proposal. All services
must be included in the proposal in order for it to be considered. The services and scope of
services are as follows:
1. CAFR-The auditor will prepare and issue an auditor's opinion and conduct an audit
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City Commission Memorandum -Auditing Services RFP
March 21, 2012
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of the City's CAFR in accordance with Generally Accepted Auditing Standards
(GAAS) and the standards applicable to financial audits contained in Government
Auditing Standards, issued by the Controller General of the United States.
The examination must be made in accordance with the guidelines prepared by the
Governmental Finance Officers Association (GFOA) in order for the City to apply for
the Certificate of Achievement for Excellence in Financial Reporting.
The examination will include the governmental activities, the business-type activities,
the aggregate discretely presented component units, each major fund, and the
aggregate remaining fund balances of the City, except for the City of Miami Beach
Retirement Systems for Firefighters and Police Officers, the City of Miami Beach
Retirement Systems for General Employees, the City of Miami Beach Retirement
System for Unclassified Employee and Elected officials, the Firemen's Relief and
Pension Fund, and the Policemen's Relief and Pension Fund, which are audited by
other auditors.
On an annual basis, the City will prepare the CAFR for auditing. The auditors will
provide guidance with the implementation of Governmental Accounting Standard
Board (GASB) statements as necessary.
The audit firm shall issue an audit opinion to the City no later than 180 days following
the fiscal year end.
2. OMB A-133 Single Audits -The auditor must perform an 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.
The auditor must issue an Independent Auditors' Report on Internal Control over
Financial Reporting and on Compliance, Independent Auditors' Report on
Compliance and Internal Control over Compliance Applicable to Each Major Federal
Program and State Project, and Schedule of Findings and Questioned Costs.
The City will prepare the Schedule of Expenditure of Federal Awards and State
Financial Assistance.
The audit firm shall issue the single audit report and data collections form to the
City no later than 180 days following the fiscal year end.
3. Management letter in Accordance with the Rules of the Auditor General of the
State of Florida -The auditor shall issue a management letter to address the
following:
• The City's compliance and internal controls or schedule of findings and
questioned costs, whether or not inaccuracies, shortages, defalcations, fraud
and/or violations of laws, rules, regulations, and contractual provisions
reported in the preceding annual financial audit report have been corrected.
• The City's compliance and internal controls or schedule of findings and
questioned costs, whether or not recommendations made in the preceding
annual financial audit report have been followed.
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City Commission Memorandum -Auditing Services RFP
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• Provisions of Section 218.415, Florida Statutes, regarding the City's
investment of public funds.
• The City's compliance and internal controls or schedule of findings and
questioned costs: (1) violations of laws, rules, regulations, and contractual
provisions that have occurred, or are likely to have occurred; (2) improper or
illegal expenditures; (3) improper or inadequate accounting procedures (for
example, the omission of required disclosures from the financial statements);
(4) failures to properly record financial transactions; and (5) other
inaccuracies, shortages, defalcations, and instances offraud discovered by,
or that come to the attention of, the auditor.
• Section 218.503(1), Florida Statutes, regarding financial emergencies.
• The annual financial report for the City filed with the Department of Financial
Services pursuant to Section 218.32, Florida Statutes.
• The name or official title and legal authority for the primary government and
each component unit of the reporting entity be disclosed in the management
letter, unless disclosed in the notes to the financial statements.
The audit firm shall issue a management letter to the City no later than 180 days
following the fiscal year end.
4. RDA -The City issues stand-alone basic financial statements for the RDA, a
blended component unit of the City. The auditor will prepare and issue an auditor's
opinion and conduct an audit of the RDA basic financial statements in accordance
with Generally Accepted Auditing Standards (GAAS) and the standards applicable to
financial audits contained in Government Auditing Standards, issued by the
Controller General of the United States.
The financial statements, footnotes and schedules are to be prepared by the auditor.
The audit firm shall issue the RDA basic financial statements to the City no later than
180 days following the fiscal year end.
5. PSF-The City issues stand-alone financial statements for the PSF, a major
enterprise fund of the City. The auditor will prepare and issue an auditor's opinion
and conduct an audit of the PSF financial statements in accordance with Generally
Accepted Auditing Standards (GAAS) and the standards applicable to financial
audits contained in Government Auditing Standards, issued by the Controller
General of the United States.
The financial statements, footnotes and schedules are to be prepared by the auditor.
The audit firm shall issue the PSF basic financial statements to the City no later than
150 days following the fiscal year end.
6. VCA-The City issues stand-alone basic financial statements for the VCA, a
discretely presented component unit of the City. The auditor will prepare and issue
an auditor's opinion and conduct an audit of the VCA financial statements in
accordance with Generally Accepted Auditing Standards (GAAS) and the standards
applicable to financial audits contained in Government Auditing Standards, issued by
the Controller General of the United States.
The financial statements, footnotes and schedules are to be prepared by the auditor.
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The audit firm shall issue the VCA basic financial statements to the City no later than
90 days following the fiscal year end.
7. Convention Center-The City issues special purpose financial statements for
assets, liabilities, revenues, and expenses of the Miami Beach Convention Center,
as managed by Global Spectrum. The auditor will prepare and issue an auditor's
opinion and conduct an audit of the assets, liabilities, revenues and expenses in
accordance with Generally Accepted Auditing Standards (GAAS) and the standards
applicable to financial audits contained in Government Auditing Standards, issued by
the Controller General of the United States.
The financial statements, footnotes and schedules are to be prepared by the auditor.
The audit firm shall issue the SMG special purpose financial statements to the City
no later than 90 days following the fiscal year end.
8. SNP-The SNP governing Miami-Dade County ordinance No. 96-115 requires that
an annual independent audit of all bond funds be conducted. The auditor will
conduct an audit to incorporate the following:
• Tests for compliance with the grant agreement, SNP ordinance No. 96-115,
applicable resolution and the SNP Administrative Rules.
• Tests for compliance with advance requirements.
• Tests for expenditures of required match dollars.
• Verification of the Fund Summary Status Report.
The audit report, notes and schedules are to be prepared by the auditor. The audit
firm shall issue the SNB to the City no later than 90 days following the fiscal year
end.
9. BBC-The BBC governing Miami-Dade County ordinance No. 05-47 requires that an
annual independent audit of all bond funds be conducted. The auditor will conduct
an audit to incorporate the following:
• Tests for compliance with the grant agreement, BBC ordinance No. 05-47,
applicable resolution and the BBC Administrative Rules.
• Tests for compliance with advance requirements.
• Tests for expenditures of required match dollars.
• Verification of the Fund Summary Status Report.
The audit report, notes and schedules are to be prepared by the auditor. The audit
firm shall issue the BBC to the City no later than 90 days following the fiscal year
end.
10. The Children's Trust -The Children's Trust Fund (the "Trust") requires that an
annual independent audit of the Trust financial statement be performed as to the
specific audit requirements imposed by the Trust's contractual agreement. The
auditor will prepare and issue an auditor's opinion and other reports in accordance
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City Commission Memorandum -Auditing Services RFP
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with the Trust agreement and in accordance with Generally Accepted Auditing
Standards (GAAS) and the standards applicable to financial audits contained in
Government Auditing Standards, issued by the Controller General of the United
States.
The audit report, notes and schedules are to be prepared by the auditor. The audit
firm shall issue the Trust audit to the City no later than 90 days following the fiscal
year end.
MINIMUM SUBMITTAL AND QUALIFICATIONS REQUIREMENTS
1 Respondent's Qualifications
a. Describe the respondent's professional development program, including the
approximate number of hours of continuing education attended by the
respondent. Also indicate the number of days of specialized training in
governmental accounting and auditing received during the last two years of
personnel to be assigned to this engagement. Indicate compliance with the
State Board of Accountancy requirements applicable to audits of Florida local
governments.
b. Describe the participation of the respondent in national or state,
governmental or professional, accounting or auditing Boards or Committees
during the last three years.
c. Describe the respondent's quality control programs and procedures that
ensure compliance with the respondent's professional standards review and
AICPA standards. Indicate whether the respondent is in the SEC Practice
Section and/or the Private Companies Practice Section of the Quality Control
Program. If the respondent answered positively to the preceding, attach a
copy of the last Peer Review received by the respondent.
d. Describe the respondent's (local office for national firms) experience in
providing accounting and auditing services to local governments.
e. Describe any litigation in excess of $100,000 filed against the respondent in
the State of Florida over the last three years. Also describe any terminations,
suspensions, censures, reprimands, probations or similar actions against the
respondent or any member of the respondent's firm by the Florida State
Board of Accountancy in the last three years.
f. The respondent will make a statement as to their independence with regard
to the City.
2. Qualifications of Project Team:
List the members of the project team. Provide a list of the personnel to be used on
the project and their qualifications. A resume including education, experience,
licenses and any other pertinent information shall be included for each team
member, including subcontractors to be assigned to each project. These resumes
should be, at minimum, for the partner, the manager and the senior for this
engagement. The resume should include the continuing education in governmental
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City Commission Memorandum-Auditing Services RFP
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auditing and other governmental audit engagements that they have undertaken.
3. Methodology and Approach:
Describe the respondent's approach to this audit engagement. This should include at
least the following:
• Development of the audit program.
• Organization of the audit team and titles of team members and approximate
amount of time each such class of member will spend on the audit.
• The names of the partner and manager that will be assigned to this engagement
and the extent of their involvement with this engagement. Any substitution of
these individuals must be approved by the Audit Committee prior to any change
of staffing.
• The proposed schedule for the audit.
• Any anticipated use of internal audit staff or other City staff.
• Provide at least five (5) client references within the south Florida area.
4. Previous Similar Projects:
A list of a minimum of ten similar projects must be submitted. Information should
include:
• Client Name, address, contact phone number.
• Description of similar scope of services.
• Month and Year the project was started and completed.
5. Training
The City desires to maintain and improve the level of training of its personnel
assigned to the internal audit function and in accounting positions. The proposal
should indicate if the firm conducts any training for its employees and if City
personnel could attend such training.
6. Award of Contract
It is anticipated that the Evaluation Committee will review these proposals and
recommend a qualified accounting firm to the City Manager who will make a
recommendation to the City Commission. The City Commission will select the
accounting firm to undertake the engagement and authorize the City Manager or his
designee, to negotiate with the selected firm or firms for the engagement.
7. Performance Evaluation Surveys Provided by Prior Clients
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City Commission Memorandum -Auditing Services RFP
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EVALUATION/SELECTION PROCESS; CRITERIA FOR EVALUATION
The procedure for proposal evaluation and selection is as follows:
1. Request for Proposals issued.
2. Receipt of proposals.
3. Opening and listing of all proposals received.
4. An Evaluation Committee, appointed by the City Manager, shall meet to
evaluate each proposal in accordance with the requirements of this RFP. If
further information is desired, proposers may be requested to make
additional written submissions or oral presentations to the Evaluation
Committee.
5. The Evaluation Committee shall recommend to the City Manager the
proposal or proposals acceptance of which the Evaluation Committee deems
to be in the best interest of the City. The Evaluation Committee shall base its
recommendation on the following criteria:
• Firm's Experience in Auditing Services-20 points
• Qualifications of Project Team-20 points
• Methodology and Approach - 1 0 points
• Previous Similar Projects -15 points
• References Provided by Prior Clients -15 points
• Fees -20 points
LOCAL PREFERENCE: The Evaluation Committee will assign an additional
five (5) points to Proposers, which are a Miami Beach-based vendor as
defined in the City's Local Preference Ordinance.
VETERANS PREFERENCE: The Evaluation Committee will assign an
additional five (5) points to Proposers, which are a small business concern
owned and controlled by a veteran(s) or a service-disabled veteran business
enterprise, as defined in the City's Veterans Preference Ordinance.
6. After considering the recommendation(s) of the Evaluation Committee, the
City Manager shall recommend to the City Commission the proposal or
proposals acceptance of which the City Manager deems to be in the best
interest of the City.
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City Commission Memorandum-Auditing Services RFP
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7. The City Commission shall consider the City Manager's recommendation(s)
in light of the recommendation(s) and evaluation of the Evaluation
Committee and, if appropriate, approve the City Manager's
recommendation(s). The City Commission may reject City Manager's
recommendation(s) and select another proposal or proposals. In any case,
City Commission shall select the proposal or proposals acceptance of which
the City Commission deems to be in the best interest of the City. The City
Commission may also reject all proposals.
8. Negotiations between the selected proposer and the City Manager or
designee take place to arrive at a contract. If the City Commission has so
directed, the City Manager may proceed to negotiate a contract with a
proposer other than the top-ranked proposer if the negotiations with the top-
ranked proposer fail to produce a mutually acceptable contract within a
reasonable period of time.
9. If the City Commission has so approved, the City Manager or designee after
successful negotiations, will present a contract acceptable to the respective
parties to the City Attorney's office for approval as to form and language, and
then to the Mayor and City Clerk for signature after the selected proposer
has done so.
CONCLUSION
The Administration recommends that the Mayor and Commission authorize the issuance of
the RFP for auditing services.
JMG/PW/aw
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