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HomeMy WebLinkAboutStatement of Work - Crowe LLP - 2018 Comprehensive Annual Financial Report Prep1316 COUNTY —CITY BUILDING 227 W.JEFFERSON BOULEVARD SOIJTH BEND. INDIANA 46601-1 830 (bUTR . i 1865 CITY OF • BEND PETE BUTTIGIEG, MAY IB BOARD PUBLICWORKS February 12, 2019 Mark Maraccini Crowe LLP 225 West Wacker Drive, Suite 2600 Chicago, IL 60606 RE: Statement of Work Dear Mr. Maraccini: PHONE 574/235-9251 FAX 574/235-9171 The Board of Public Works, at its meeting held on February 12, 2019, approved the above referenced agreement to assist the City in preparation of the 2018 Comprehensive Annual Financial Report in the amount not to exceed $8,900. Enclosed please find a copy of the agreement for your records, If you have any further questions regarding this matter, please call this office at (574) 235- 9251. Sincerely, Linda M. Martin, Clerk Enclosure GARY A. GILOT SUZANNA M. FRITZBERG ELIZABETH A. MARADIK LAURA O'SULLIVAN THERESE J. DORAU CAFR Preparation Assistance Services City of South Bend, Indiana This statement of Work is being issued under the Master Services Agreement between Crowe LLP ("Crowe") and the City of South Bend, Indiana ("City") effective July 1, 2016. The purpose of this Statement of Work is to confirm the arrangements for Crowe to assist the City in performing Comprehensive Annual Financial Report (CAFR) preparation services by assisting the City the with the preparation of the 2018 CAFR including supplementary schedules for for the fiscal year ended December 31, 2018. The Scope of Work is outlined below includes the general scope area with the procedures and deliverables that will be performed. The services will be performed in accordance with the Standards for Consulting Services established by the American Institute of Certified Public Accountants. The fees associated with each general area within the Scope of Work are outlined within the Professional Fees section of this Statement of Work. The City shall assist Crowe with obtaining information necessary for the performance of the services contemplated in this Statement of Work. Further, the City and Crowe agree that Crowe will not be responsible for any delays caused by failure to receive access or updated information from the City or any third -party. Crowe shall not be responsible for reviewing the authenticity of documentation submitted for review. The City shall be responsible to: make all management decisions and perform all management functions; designate an individual who possesses suitable skill, knowledge, and/or experience, within senior management to review and approve the scope of Crowe's services; evaluate and approve the adequacy and results of the services performed; provide Crowe with data in a timely manner as required to complete project -related activities; accept responsibility for the results of the services; and establish and maintain internal controls, policies, procedures and checklists including monitoring ongoing activities and validating that data provided to Crowe is accurate and complete. The City shall also be responsible to accept the delivery of goods and services, and approve our deliverables. SCOPE OF WORK Page 1 of 5 CAFR Preparation Assistance Services ON of South Bend, Indiana Phase 1: Planning Critical to any engagement is a mutual understanding of the project goals and objectives and the expected outcomes and deliverables prior to beginning project activities. Therefore, in the Planning phase, we will conduct an Entrance Conference with the City to initiate and kick-off this project. During our Entrance Conference, we will coordinate the project timing, including scheduled meetings and deliverable due dates. During this phase, we will also define the roles and responsibilities of key project staff both from the City and from Crowe. These roles and responsibilities will be documented so all parties are clear who is responsible for performing specific project tasks. Phase 2: Obtain and Review Documentation In this phase, Crowe will use its experience and technical accounting expertise to review schedules, statements, and any other relevant documentation that pertains to the CAFR. We will review all documentation from a technical standpoint, from a tie out standpoint, as well as ensuring all documentation is adequately supported and updated with correct dates, data sets, grammar and punctuation. Through our review, we will provide proposed technical revisions and comments as we see fit. These revisions and comments will improve documentation and ensure schedules and statements are properly presented and can be utilized to assist with phase 3, preparation of the draft CAFR. Phase 3: Prepare Draft CAFR The first step of Phase 3 will be to prepare the financial reporting entries (also referred to as GASB 34 entries) to convert the governmental statements to the government -wide statements. Crowe has included completing these entries as an optional service below. Once these entries are completed, we will prepare the draft CAFR. Once the draft CAFR is complete, we will provide the CAFR to our technical team for review. Once approved by our technical team, we will issue the draft CAFR to the City for review. Based on comments and feedback from the City's review, we will make updates to the draft CAFR. The revised draft CAFR will be provided back to the City to provide to the City's auditors. Phase 4: Prepare Final CAFR We will then plan to meet with the auditors to obtain any revisions or comments on the draft CAFR. In addition, we will update the CAFR for any audit adjustments that have been recorded by City. Once the draft CAFR has been approved by the City and Auditors, we will finalize the CAFR and provide a final .pdf version of the CAFR to the City for production. QpAional Services: Beyond providing the core service of CAFR preparation, Crowe believes it can provide some additional services that can provide additional value, beyond what Crowe will already be providing through the CAFR preparation: GASB Implementation Assistance Crowe can provide assistance navigating and implementing GASB accounting standards that are required for government entities. Crowe will work hands on with City employees to ensure GASB Page 2 of 5 CAFR Preparation Assistance Services Citv of South Bend. Indiana pronouncements are properly implemented and up to date with the most recent accounting standards and guidelines. Government -Wide Conversion Entry Assistance and Conversion Reconciliation Crowe can provide assistance with the government wide conversions of assets, liabilities and fund balance accounts from modified cash basis to the modified accrual and full accrual promulgated by GASB for a CAFR. Once the activity for the current year has been converted, we will start preparing the draft CAFR. Assistance with Audit Findings or Issues Once the auditors have presented their findings to the City, Crowe can provide assistance with responding to and/or remediating any findings or issues that arose from the audit. Project Schedule The following is an estimate of the project schedule with a breakdown by phase and step. As work progresses, modifications to the schedule may be necessary and such modifications will be communicated in writing. Gra hie 2 - Estimated Pr`ect Timeline Phase 1— Planning Phase 2 - Obtain and Review Documentation Phase 3 - Draft CAFRs Phase 4 - Final CAFR Crowe plans to begin and complete its planning phase in February and be completed by the beginning of March. In March, Crowe plans to begin to obtain documentation, perform our review of documentation (with comments and revisions), and compile a draft CAFR. We plan to have the draft CAFR compiled by March 22"d, and to the auditors by April 1st. Once the auditors provide their comments, we will prepare the final CAFR in June. PROFESSIONAL FEES Fee Summary Our goal in setting fees is simple: to provide long-term, cost-effective pricing for our clients. We are confident that we can work together to achieve an optimized plan for internal audit services. We are committed to working with you to make sure the scope of our proposal is appropriate. While we experience cost increases throughout our relationships with our clients, we make every effort to structure an engagement fee arrangement, which will meet your needs while providing us with sufficient resources to perform the expected work. Crowe agrees to perform the services outlined in this Statement of Work for a total fee not to exceed eight thousand nine hundred dollars ($8,900) in accordance with the following pricing table: Page 3 of 5 CAFR Preparation Assistance Services City of South Bend, Indiana Core Services w:w''r✓,w"'are !� �� ,,,!, `'f /��v r." "(r�r<'m'w'vu(lfwwr� /"��r�(wrr� wµwrxaa w�wraww�"''rr�wauw,� ww,r��rw.rw,"wrww�wwrwrrrr/Fw( wwaw�w,�w✓utaw�wbrr aorwr�" 'rd.. Phase 2 Documentation Review $1,800 - $2,400 Phases 3 and 4 Preparation of Draft(s) and Final CAFR $4,500 - $6,500 Total Fees $6,300- $8,900 w In addition to the core services above, we can also provide several additional optional services. We have included those services below: GASB Implementation Assistance including GASB 75 Government Wide Conversion Assistance including reconciliations from government -wide to fund level statements Assistance with Audit Findings or Issues For the above optional services, we would use the hourly rates below. These rates have been reduced from our standard rates to demonstrate our commitment to serve the City. When specific tasks are identified by the City, we would determine an estimate for the work and provide that estimate to the City prior to beginning work. The estimated amount will not be exceeded without approval from the City. Partner $340 Senior Manager $250 Manager $200 Senior $165 Staff $130 Fee Assumptions • NO ADDITIONAL CHARGE for access to our thought leadership e-communications, webinars and literature. • NO ADDITIONAL CHARGE for use of our secure information -sharing tool (CiRT) to gather and track audit requests or for additional data analytics tools that we incorporate into our audits • Fees include professional time for work associated with on -site and off -site performance and documentation of procedures, preparation of written drafts and final reports, and presentation of results. • Our policy is to bill for reasonable actual out-of-pocket expenses incurred. We will not surprise you with additional fees that have not been agreed to by all parties in advance. We will not charge for routine telephone calls, which are considered to be part of the basic services. If a question results in significant research or additional work or if we are Page 4of5 CAFR Preparation Assistance Services City of South Bend, Indiana requested to perform a consulting project, such effort is billed separately. We will provide you with an estimate of fees for such services and obtain management approval before proceeding. • The City will record all journal entries and conversion entries and provide completed modified accrual and full accrual balances to Crowe. • The City will complete information needed for all Statements, Schedules, RSI, and disclosures for Crowe to compile the CAFR. • Crowe will perform a technical review documents as received, but recommended changes noted during the review would be made by the City. The agreements of the City and Crowe contained in this letter shall survive the completion or termination of this engagement. If any portion of this Statement of Work is found unenforceable or invalid, that shall not affect the other terms, all of which shall continue in effect. Thank you for the opportunity to present this Statement of Work to you. If the terms and objectives of our engagement as described in this letter and in the underlying MSA are acceptable, please authorize us to proceed by returning one copy of this letter signed by an officer of the City. I have reviewed the arrangements outlined above, and I accept on behalf of the City the terms and conditions as stated. CROWE LLP By: Name: Mark Maraccinii Title: Partner CITY OF SOUTH BEND, INDIANA : Namf Title: Page 5 of 5 BOARD OF PUBLIC WORKS AGENDA ITEM REVIEW REQUEST FORM Controller review is required for all Contracts $5,000.00 or more Controller ® and greater than one year in length per the City Purchasing Policy Purchasing ❑ Check the Appropriate Item Type — `Re uired for All Submissions ❑ Agreement El Contract ❑ Proposal Ej Addendum ® Professional Services D Amendment Bid Opening ❑ Bid Award ❑ Req. to Advertise ❑ Title Sheet Quote Opening ❑ Quote Award El Chg Order No. ❑ C/O & PCA No. ❑ PCA �j Ease./Encroach. ❑ Traffic Control ❑ Resolution ❑ Other: F� Claim R auired Information Company or Vendor Name J3LuLp—Syder— New Vendor El Yes ❑ If Yes, Approved by Purchasing ® No MBE/WBE Contractor ❑ MBE Completed E-Verify Form Attached El Yes ❑ WBE ❑ No Project Name 2018 CAFR Project Number None Funding Source ...._. Account No. ............ .__...... .......... 101-0401-415.31-06 Amount NTE $8,900 ...... Terms of Contract Purpose/Description Contract for ro _.. professional services of accounting consultant to assist City in preparation of 2018 Comprehensive Annual Financial R'ecort, Fo Amount of El Increase $ Decrease Previous Amount $ Current Percent of Change: % New Amount $ Total Percent of Change: % Time Extension: Dispersal After Approval Copy Original F-1 El ❑ ❑ ❑ ❑