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09/19/2001 CLERK OF THE CIRCUIT COURT MONROE COUNTY BRANCH OFFICE MARATHON SUB COURTHOUSE 3117 OVERSEAS HIGHWAY MARATHON, FLORIDA 33050 TEL. (305) 289-6027 FAX (305) 289-1745 MONROE COUNTY COURTHOUSE 500 WHITEHEAD STREET KEY WEST, FLORIDA 33040 TEL. (305) 292-3550 FAX (305) 295-3663 BRANCH OFFICE PLANTATION KEY GOVERNMENT CENTER 88820 OVERSEAS HIGHWAY PLANTATION KEY, FWRIDA 33070 TEL. (305) 852-7145 FAX (305) 852-7146 October 4,2001 Kemp & Green, P.A 1438 Kennedy Drive Key West, FL 33040 Dear Ms. Green: Please be advised that at a Regular Meeting in formal session on September 19, 2001, the Board of County Commissioners of Monroe County granted approval and authorized execution of an Agreement between Monroe County and Kemp & Green, P .A., Certified Public Accountants for the purpose of providing audit of County records, as required by F.S. 11.45, commencing August, 2001, and to be for the next consecutive three years with the option of extending the contract for one additional year. files. Attached hereto is a fully-executed duplicate original of the subject agreement for your Should you have any questions concerning the above, please do not hesitate to contact this office. Very truly yours, Danny L. Kolhage Clerk of Court and ex-officio Clerk to the Board of County Commissioners ByJl~C. ~ Isabel C. DeSantis, Deputy Clerk Cc: County Attorney Finance hile CLERK OF THE CIRCUIT COURT MONROE COUNTY BRANCH OFFICE MARATHON SUB COURTHOUSE 3117 OVERSEAS HIGHWAY MARATHON, FLORIDA 33050 TEL. (305) 289-6027 FAX (305) 289-1745 MONROE COUNTY COURTHOUSE 500 WHITEHEAD STREET KEY WEST, FLORIDA 33040 TEL. (305) 292-3550 FAX (305) 295-3663 BRANCH OFFICE PLANTATION KEY GOVERNMENT CENTER 88820 OVERSEAS HIGHWAY PLANTATION KEY, FLORIDA 33070 TEL. (305) 852-7145 FAX (305) 852-7146 September 5, 2001 Mayor George Neugent Commissioner Charles "Sonny" McCoy Commissioner Murray Nelson Commissioner Dixie Spehar Commissioner Nora Williams Dear Mayor Neugent and Commissioners, I am enclosing herewith a proposed Agreement between Monroe County and the firm of Kemp & Green, P A Certified Public Accounts, for the purpose of providing the County audit as required by Florida Statutes 11.45. As you are aware the Audit Selection Committee went through the Request for Proposals process as outlined in the Statute and made a recommendation to the Board of County Commissioners which was approved by the Board at your meeting of July 18, 2001. Also at that meeting the Board requested that I negotiate the terms of the agreement. This proposed agreement represents the results of those negotiations. The agreement covers the three fiscal years beginning with 2001 with an optional one year extension. The amounts to be paid to the auditor are indicated on page 8 of the proposed agreement. The first year, which includes our fiscal year which will end on September 30, 2001, in the amount of $156,200.00 represents a three percent (3%) cost of living adjustment with an additional amount of $6,700.00 to cover work required of the auditor concerning the Sheriffs cost allocation as required by your contracts with the Village of Islamorada and the City of Marathon. Each of the following fiscal years included in the enclosed proposed agreement represent an increase of three percent (3%). As we indicated to you during our conversations there will be additional costs involved with our County auditor concerning the implementation of GASB Statement 34. However, there are no GASB Statement 34 implementation costs included in this proposed agreement as a decision is still pending as to whether or not the requirements of GASB 34 will apply to the financial statements of the Constitutional Officers. Kemp & Green, P A Page 2 Once that decision has been made I will come back to the Board of County Commissioners with an estimate of costs involved which will be accomplished under the "Extra Work" provision of the enclosed Agreement with a, "not to exceed" amount that will be agreed to by both parties. If you have any questions concerning the enclosed Agreement please do not hesitate to contact me, and it is my intention to be present at the meeting where this Agreement will be considered for adoption by the Board. Sincerely, \ D e, Clerk of the Circuit Court attachments cc: County Administrator County Attorney AGREEMENT Between MONROE COUNTY and KEMP & GREEN, P.A. CERTIFIED PUBLIC ACCOUNTANTS PROVIDING FOR AN AUDIT OF COUNTY RECORDS COMMENCING AUGUST, 2001 AND TO BE FOR THE NEXT CONSECUTIVE THREE YEARS WITH THE OPTION OF EXTENDING THE CONTRACT ONE ADDITIONAL YEAR KNOW ALL MEN BY THESE PRESENTS: That MONROE COUNTY, a body corporate and politic, and a political subdivision of the State of Florida, hereinafter referred to simply as COUNTY, through its Board of County Commissioners, which term shall include their successors and assigns, AND KEMP & GREEN, P.A., Certified Public Accountants, having its principal place of business at #12 Luani Plaza, 1438 Kennedy Drive, Key West, Florida, 33040, P . O. Box 1529, Key West, Flori da 33041-1529, and doi ng busi ness or authori zed to do bus i ness in the State of Flori da, herei nafter referred to simply as AUDITOR. WITNESSETH, that, for and in consideration of the mutual terms and conditions, promises, covenants and payments hereinafter set forth, COUNTY and AUDITOR hereby agree as follows: ARTICLE I PREAMBLE In order to establish the background, context and frame of reference for this Agreement and to manifest the objectives and intentions of the respective parties herein, the following statements, representations and explanations shall be accepted as predicates for the undertakings and commitments included within the provisions which follow and may be relied upon by the parties' essential elements of the mutual consideration upon which this agreement is based. 1.1 Section 11.45 of the Florida Statutes and Section 10.800 of the Rules of the Auditor General of the State of Florida, which are not incorporated herein by reference, require that the COUNTY shall provide annually for a financial audit of the accounts and finances of the COUNTY. 1.2 Monroe County, pursuant to Florida Statute 11.45 when hiring consultants, undertook a selection and negotiation process as required by Florida Statutes in seeking a firm to perform the required audit. 1.2.1 The Audit Selection Committee to which this responsibility was delegated selected three (3) qualified firms and made its recommendation to the Board of County Commissioners on July 10, 2001. 1.2.2 On July 18, 2001. the Board of County Commissioners voted to hire the firm of Kemp & Green, P.A. to perform the Financial Audit as required by Florida Statute 11.45 and Section 10.800 of the Rules of the Auditor General of the State of Florida, provided that the firm could agree upon the terms of a contract. ARTICLE II DEFINITIONS 2.1 COUNTY.- Monroe County, a body politic and a political subdivision of the State of Florida. 2.2 AUDITOR -. Kemp & Green, P.A., Certified Public Accountants. 2.3 FINANCIAL AUDIT -. An examination of the financial statements in order to express an opinion of the fairness with which they present the financial position, results of operations. and cash flows in conformity with general accepted government accounting principles and an examination to determine whether operations are properly conducted in accordance with legal and regulatory requirements. 2.4 FINANCIAL AUDIT REPORT REQUIRED BY STATUTES .. The financial audit report, as required by F.S. 11.45 and Section 10.800 of the Rules of the Auditor General, shall consist of the following: 2.4.1 AUDITORS' REPORT ON EXAMINATION OF FINANCIAL STATEMENTS .- The report prepared by an auditor covering the audit or investigation made by him/her. The report shall include but not be limited to: 2 a.) A statement of the scope of the audit; b.) Explanatory comments (if any) concerning exceptions by the AUDITOR as to application of either generally accepted auditing standards or generally accepted accounting principles or the consistency of application of such principles; 2.4.2 FINANCIAL STATEMENTS -- A balance sheet, statement of revenues and expenditures, or other statements of presentation of fi nanci a 1 data, i nc 1 udi ng accompanyi ng notes, deri ved from the accounting records presented in conformity with the fund and/or group classifications as required for compliance with Section 10.800 of the Auditor General. 2.4.3 AUDITORS' LETTER OF COMMENTS AND RECOMMENDATIONS .. A letter to the COUNTY containing various comments and recommendations by the AUDITOR based upon review of the COUNTY's system of internal accounting and operating controls and other findings. Similar letters shall be submitted to each of the County Constitutional Officers. 2.5 AUDITING SERVICES -- The services related to performing a financial audit as defined in Article 2.3. Auditing services also include similar exami nat ion and/or revi ew procedures that may be requi red by the Board of County Commissioners as extra work which would involve exclusively the use of the AUDITOR's auditing staff. Such extra work may only be authorized by written approval of the Board of County Commissioners. ARTICLE III FINANCIAL AUDIT SCHEDULE 3.1 FISCAL YEAR ENDING SEPTEMBER 30. 2001 -- The Financial Audit for the fiscal year ended September 30, 2001, shall be completed and the final draft of the Comprehensive Annual Financial Report as defined in Article 2.4 sha 11 be completed on or before March 15, 2002. The fi na 1 comprehensi ve annual financial statement must be submitted on or before March 23, 2002. These dates will apply to the audits conducted for each succeeding year for the term of this contract, to wit: the fiscal years ending September 30, 2002, and September 30, 2003 with the option of extending the contract one additional year. 3 ARTICLE IV SCOPE OF AUDIT 4.1 FUNDS AND ACCOUNT GROUPS - - The fi nanci a 1 statements shall be prepared in conformance with the primary funds and account groups as prescri bed by GASB, wi th supp 1 ementa 1 schedul es as requi red for comp 1 i ance with Section 10.800 of the Rules of the Auditor General of the State of Florida. Funds may be combined to the extent permitted by the Industry Audit Guide and by Governmental Accounting Standards. 4.1.1 PRIMARY REPORT ON GENERAL PURPOSE FINANCIAL STATEMENTS -- The fo 11 owi ng funds and account groups are used by the COUNTY, and in conformity with generally accepted principles of governmental accounting, are those into which the general purpose financial statements are to be classified and grouped for financial reporting and audit opinion purposes: . General ,funds . Special revenue funds . Debt service funds . Enterprise funds . Internal service funds . Capital projects funds . Expenditure trust funds . Agency funds . General fixed asset group of accounts . General long-term debt group of accounts 4.1.2 SUPPLEMENTAL FINANCIAL REPRESENTATIONS .. Supplemental to the above funds and accounts groups are the fi nanci a 1 representations of following entities and/or Constitutional Officers: . Monroe County Board of County Commissioners . Supervisor of Elections of Monroe County . Monroe County Clerk of the Circuit Court Clerk ex-officio of the Board of County Commissioners . Monroe County Tax Collector . Monroe County Property Appraiser . Monroe County Sheriff . Monroe County Comprehensive Plan Land Authority 4 The AUDITOR will provide separately bound individual reports relating to each of the above entities or Constitutional Officers which will include an opinion, management letters and financial statements. 4.2 GENERAL AUD IT COND ITIONS -- The AUDITORS wi 11 conduct pre. audi t conferences with the Constitutional Officers of Monroe County concerning the ensuing auditing program, prior to commencement of their filed work connected with each annual audit. 4.2.1 The AUDITORS will communicate in writing with the Board of County Commissioners and all Constitutional Officers on or before November pt of each year concerning any item revealed during the fieldwork which may be included in the Management Letter to be issued pursuant to the provision entitled MANAGEMENT LETTER which is section 4.3 of this contract. 4.3 MANAGEMENT LETTER .- A tentative Management Letter and preliminary financial audit report shall be delivered to the COUNTY and each County Agency according to Florida Statutes. 4.4 COMPLIANCE LETTER .- In addition to the Management Letter, and in the same manner, the AUDITOR shall prepare and submit to the Board of County Commissioners of Monroe County a letter regarding the COUNTY's compliance with the terms of its various bond issues existing at the date of this contract. 4.5 AVAILABILITY OF RECORDS -- It is further contemplated that records relating to the audit of each year commencing on September 30, 2001, shall be available at the conclusion of each fiscal year no later than December 15, 2001 and December 15 of each succeeding year during the term of this contract. 4.6 AUDIT STANDARDS . - Each audi t shall be done in conformi ty wi th generally accepted auditing standards as promulgated throughout the American Institute of Certified Public Accountants (AICPA) Industry Audit Guide, Audits for State and Local Governmental Units, AICPA standards and procedures, and, excluding the review of economy and efficiency of operations and program results, standards and procedures set forth in the publication Government Auditinq Standards issued by the Comptroller General of the United States. Requirements of Federal and State agreements and statutory audit requirements will be conformed with as each may be applicable. 5 4.7 COOPERATION WITH AUDITOR GENERAL AND CONSULTING FIRMS -- Where app 1 i cable, Kemp & Green, P . A., as the COUNTY's pri nci pa 1 audi tors sha 11 coordinate their work and cooperate with the Auditor General of the State of Florida, and with any and all consulting firms under contract to Monroe County and other County agencies. 4.8 IRREGULARITIES -- Should irregularities or other unforeseeable conditions be encountered which might necessitate the extension of the auditing work beyond the scope of normal auditing procedures, the AUDITOR agrees to advise the COUNTY in writing of the circumstances and to request an increase in the total fees be made avai 1 able before si gni fi cant addi ti ona 1 costs are incurred. Any request for additional time or additional fees shall be in writing and shall contain a detailed explanation of the unforeseen conditions or i rregu1 arities. and why the additional fees are necessary. Whether a time extension or additional fees are granted to AUDITOR is at the sole discretion of COUNTY. 4.9 ILLEGAL ACTS -- The AUDITOR is aware that i 11 ega1 acts may be discovered during the audit. However it is recognized that the audit cannot be re 1 i ed upon to assure the di scovery of i 11 ega 1 acts, nor is the audi t primarily or specifically designed to disclose defalcations and other illegal acts, though their discovery may result. The AUDITOR agrees to immediately di sc lose the di scovery of any and all ill ega 1 acts to the Board of County Commissioners. 4.10 STANDARD OF CARE -- In the performance of the audit, the AUDITOR shall be bound by and shall make the examination in accordance with generally accepted auditing standards. 4.11 EXPRESSION OF OPINION -- The AUDITOR shall express an unqualified opinion on the financial statements of all funds and other reports as described in the Request for Proposals for Professional Auditing Services dated May 21, 2001, or if unable to express an unqua 1 i fi ed opi ni on, the AUDITOR should state the reasons for the qualification or disclaimer of opinion. ARTICLE V EXTRA WORK 5.1 EXTRA WORK TO BE SPECIFICALLY REQUESTED BY COUNTY The AUDITOR, upon receipt of a written request from the COUNTY, shall perform such 6 additional auditing services as requested by the COUNTY. This may include a revi ew of the effi ci ency and economy of operations, systems of i nterna 1 control, operating and management procedures and effectiveness in achieving program results. The purchase of specialized services or extra audit services shall require submission of a written proposal by the AUDITOR for agreement and approval by the COUNTY. Such extra work shall be covered by a separate contract. The cost of such specialized services shall be computed and billed in accordance with the provisions of Article VII of this Agreement. 5.2 GASB 34 The Government Accounti ng Standards Board has adopted Statement No. 34, Basic Financial Statements and Management's Discussion and Analysis for State and Local Governments. As of August 31, 2001, it has not been determi ned whether thi s pronouncement wi 11 apply to the Constitutional Officers. This information is necessary to develop a reasonable estimate of fee. Accordingly, AUDITOR will provide such assistance as may be required to implement GASB 34 and will bill such assistance as extra work at the hourly rates quoted herein. ARTICLE VI WORK PAPERS 6.1 For a period of three (3) years after completion of any work provided for herein, the AUDITORS shall make the work papers, records and other evidence and documents relating to such work available for inspection and copying by the COUNTY and by the auditors retained by the COUNTY who succeed Kemp & Green, P.A. to the extent necessary to support the balances set forth in the most recent fi nanci a 1 statements of the COUNTY on whi ch the AUDITOR has reported . All pub 1 i c records under Flori da 1 aw shall be made available to the COUNTY, successor C.P.A. firms, and to the general public. Any copyi ng done shall be done at the expense of the copyi ng party. Other requests for access to such documents will be considered by the AUDITOR, but the AUDITOR has no obligation to grant them. ARTICLE VII COMPENSATION 7.1 MAXIMUM FEES FOR FISCAL YEARS ENDED SEPTEMBER 30, 2001 AND SEPTEMBER 30, 2002 AND 2003 -- AUDITOR has exercised its best efforts in attempting to estimate the time requirements and based upon that estimate has estab 1 i shed a fee for the three (3) years in whi ch thi saudi t shall be 7 undertaken. In that the successful bid accepted by the County Commission of Monroe County was in the sum of FOUR HUNDRED EIGHTY TWO THOUSAND EIGHT HUNDRED AND NO/100 DOLLARS ($482,800.00) for the next three (3) succeeding fiscal years it is agreed that the successful bidding party, Kemp & Green, P.A., shall be paid in the following fashion: that in accordance with the hourly rates hereinafter disclosed in 7.2 of the Agreement such records shall be made available to and delivered to the COUNTY from time to time and the COUNTY shall pay to Kemp & Green, P .A. on monthly bill ing therefrom. It is agreed that the contemplated amounts to be paid during the three (3) fiscal years. contingent upon and subject to annual appropriation by the COUNTY, shall be as follows: FISCAL YEAR ENDING: September 30, 2001 September 30, 2002 September 30, 2003 $ 156,200.00 160,900.00 165,700.00 Total for three (3) year period (bid as accepted) $ 482.800.00 Fees relative to the optional one year extension of this contract will be negotiated when the option is exercised. 7.2 HOURLY FEES -- The following schedule of hourly fees shall apply to extra work done for the term of this contract by the AUDITOR, whether under this Agreement or for extra work requested by the Board of County Commissioner: Partner in charge Manager Senior Accountant Staff Accountant Clerical $ 175.00 per hour $ 100.00 per hour $ 70.00 per hour $ 60.00 per hour $ 40.00 per hour 7.3 BILLING -- Each four weeks the AUDITOR shall submit a billing for all fees and expenses occurring during the preceding four weeks attributed to the audit against this contract. These billings shall reflect the percentage of completed work performed pursuant to the entities and/or Constitutional Officers listed in Article 4.1.2. 8 The statement shall show a summary of fees and expenses with accrual of the total and credits for portions paid previously. Each statement shall show the proportion of the guaranteed maximum payment that has been expended through previous billings. 7.4 PAYMENT.. COUNTY agrees to promptly process each monthly statement received from AUDITOR and it shall remit billings within thirty (30) days of receipt of AUDITOR's monthly statement. 7.5 RECORD KEEPING .- AUDITOR agrees to keep such records and accounts as may be necessary in order to record complete and correct entries as to personnel hours charged and any expenses for whi ch AUDITOR expects to be reimbursed. Such books and records will be available at all reasonable times for examination and audit by COUNTY. 7.6 NO ADDITIONAL COMPENSATION FOR EXPENSES -- Except as described in Article 7.1 or unless incurred at the specific request of the COUNTY. AUDITOR shall not be reimbursed for any travel, per diem, photocopying, telephone bill or related expenses. ARTICLE VIII GENERAL 8.1 NO ASSIGNMENT BY AUDITOR .. This Agreement, or any interest herein, shall not be assigned, transferred or otherwise encumbered under any circumstances by the AUDITOR, except by the explicit direction of the County Commission of Monroe County, it being understood, however, that the persons menti oned in paragraph 7.2, who wi 11 undertake the actual work under thi s contract are to be excluded from this provision. However, the Agreement shall run to the COUNTY and to any of its successors. 8.2 AUDITOR SHALL BE FAMILIAR WITH ALL APPLICABLE LAWS -- The AUDITOR shall familiarize themselves with and comply with the provisions of any and all Federal, State and County Orders, Statutes, Ordinances, Charters, Bond Covenants. Administrative Codes, Rule and Regulations, which may pertain to the work required under this Agreement, including specifically those which pertain to "Conflicts of Interest" and "Employment Discrimination." 8.3 TERMINATION -- This contract can be terminated only for failure to fulfill any obligation under this Agreement. 9 8.4 REPRESENTATIVES OF COUNTY -- The COUNTY and each County Agency shall designate a representative through whom all communications pertaining to the day-to-day conduct of the audit shall be addressed and shall notify AUDITOR accordingly. Such individual may, from time to time, designate one or more of his/her staff to perform all or part of the functions required thereunder and shall so advise the AUDITOR. 8.5 REPRESENTATIVES OF AUDITOR -- The AUDITOR shall inform the COUNTY and other County Agencies of the name of the representative of the AUDITOR to whom matters involving the conduct of the audit shall be addressed. 8.6 INCORPORATION OF ALL PRIOR AGREEMENTS -- This document incorporates and includes all prior negotiations, correspondence, conversations, agreements, or understandings applicable to the matters contained herein and the parties agree that there are not commi tments, agreements, or under standi ngs concerni ng the subject matter of thi s Agreement that are not contained in this document. All of the conditions, requirements, and provisions of that certain Request for Proposals for Professional Auditing Services dated May 21, 2001 are incorporated into this contract by reference. Accordingly, it is agreed that no deviation from the terms hereof shall be predicated upon any prior representations or agreements whether oral or written. It is further agreed that no modi fi cati on, amendment or a lterati on in the terms and conditions contained herein shall be effective unless contained in a wri tten document executed wi th the same formal i ty and of equal di gni ty herewith. 8.7 REPORT COPIES -- The staff of the COUNTY shall be responsible for the pub 1 i shi ng and submi ssi on of the Comprehensi ve Annual Fi nanci a 1 Report. The AUDITOR shall provide separately bound individual reports as follows: Chairman, Board of County Commissioners Auditor General Clerk of the Circuit Court Tax Collector Property Appraiser Sheriff Supervisor of Elections Number of Copies 15 4 5 1 1 1 1 10 Tourist Development Funds Comprehensive PJa~. land Authority ~ 8.8 EXECUTION -- This document shall be executed in ten (10) counterparts. each of which shall be deemed an original. 10 10 IN WITNESS WHEREOF. the parties hereto have made and executed thi s Agreement on the respective dates under each signature: MONROE COUNTY through its BOARD OF COUNTY COMMISSIONERS. signing by and" through its Chairman. authorized to execute same by Board action on the /9 ~y of Se.ft. 2001 and KEMP & GREEN. P.A.. Certified Public Accountants. COUNTY MONROE COUNTY. through its BOARD OF COUNTY COMMISSIONERS ~ ,e r-e:-~ . MaYOr~ rman .. DANNY l. KOlHAGE. Clerk BY ZANhA.%TTON DATE 10 ~ 1 / Attest: 4oM- C. ~)J~ Clerk day of 2001 AUDITOR WITNESSES: .il-L~...l c. ~~ " KEMP & GREEN. P. A. Certified Public Accountants By-N ~~ G.~ +-It _ J .L/ - day of tJc T. 2001 11