CR 90-219 Designate Auditors
~ , ,
0
~
m-
0:" Co]
. October 29, 1990 o p ~, \ " Council Report #90-219
DESIGNATE AUDITORS FOR XJm Y1UJt 1990
Pre.polled Action.
Staf f recommenda adoption of the following motion: Move~t Peat M8rw~C& M~in~
~,. b~ qagj.gn!:teQ as the .~.~-'L:.!Lt'!!a9J...tora tor the report inq ye,.!: ~~~J;h,
Adoption of this motion now will allow ~he audit fi~~ to begin preliminary reviews
and prepare audit schedules and confinnations beginning in Nov~nher, 1990.
~>ifM....l-
The Council haa designated Peat Marwick as the City's auditora since 1983. Our
werking r~lationship has been very good over the paat years. The audits hava been
thorough and different areas of the City's financial records hav~ rec.eived emphasis
in succeeding years.
P:ri....rv I.llJuJ!1I ~ CO~.}.der~
0 HAB the City's r~~~ired audit function been well aerved by Peat Harwick?
0 Are the proposed reee reasonable?
. 0 All option exists to issue specs and bid the servi~e.
Jt&'DDO'GtBs..... tp.fonlJltioA .
0 peat MArWick enqaqement letter. ,I
;;'~
-
Director
iWU' __~~iH"jV' ~'IJr:W'Jr~~~~.~ift ~~w !inIB~ n, m .Iii ~"""'!1_ ~~~_.~"_!'t~~
.
. Designate Au.ditors For The Year 1990
Report 90-219
Page 2
ball'.i~ of _i.a~
The initial basic audit fee of $10,500 has risen $6,000 over seven
years to the proposed fee of $16,500 for 1990. This is a 3% increase
over last year.
In addition; fees totaling $2,000 for special a.udits or mandated audit
work brings the total proposed fee to $18,500.
BRA Audit $11500
Single Audit $ 500
(Federal m.andate)
.
~. 'e?t lv1arwick --~I
Cerlitir..j PlJbi1c Accountants
. 4200 Norwe" Center Teiephone 612 341 222:.: TEW'lr.opie.' 612 34i 0201.
SO ~,." ,. ,evenlh Street
Minneapiis, MN 55402
October 1, 1990
Mr. John E. Schedler
Finance Officer
City of Hopkins
1010 South First Street
Hopkins, Mini1esota 55343
Dear John:
We are pleased to submit our engagement letter for our audit of the financial
statements of the City of Hopkins for the year ended December 31, 1990.
We will conduct our audit in accordance with gen~rally accepted auditing standards
with the objective of expressing an opinion on the City1s bask financial statements
as of and for the year ending December 31,1990. It should be understood that these
financial statements are the responsibility of management.
J11 conducting our audit, we will perform tests of the accounting records and f;uch
. other procedures as we consider necessary in the circumstances to provide a
reasonable basis for our opinion on the financial statements. We will examine, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. We will also assess the accounting principles used and significant
estimates made by management; as wen as evaluate the overall financial statement
presentation. We understand that aU records, documentation, and informat\on we
request in connection with our audit will be made available to us.
An audit is designed to provide reasonable assurance of detecting errors and
irregularities that are material to your financial statements. Your internal
accounting control stiIJcture should provide reasonable a.ssurance, al though not
absolute assurance. against the possibility of .such errors and irregularities. We win
furnish to you recommendations about your interr.al control stmcture we note
during our audi t. We will also furnish our recommendations about other aspects of
your operations in. which we observe opportunities for improvement.
OUf fees, which will be billed as the work progresses, are based on ;cur standard
hourly rates plus reimbursement of OUi expenses. The following 1S a summary of our
not to exceed fees fOi 1990:
l1il~ AmoJ.Jill
November 28, 1990 $ 4,000
March 20,1991 2,000
April 10, 1991 6,500
. April 24, 1991 -~
Total Fees and Expenses 116.,5QQ
Single Audit (Optional) $ 500
HRA Audit $ 1,500
~~~;c ~::;:~:)';;'-:>/~'':':.::,:/ M~ Arm of
~ ,~".', ,:, ':' , :' '..; ':: . t;1yr\'/(lk! Pl;t6t MlllWk:k Goaroe.'81
"'.",
-- ------~.'.~w~......__~""II ~- -,...,.~...... ------..- !!Il!/"1l1 _~'i'IIoK_ - T ~~f _
, . .
__ Peat Marwlck
. Our fee proposal is based upon the following:
~ City person..'1el will prepare required account analyses and pertin,.~nt audit
schedules in accordance with our prescribed formats and locate documents by
agreed upon times, We will provide you in advance with a detailed listing of
the information we will need. All schedules, computer listings, etc. will
"tie-out", be accurately footed, etc.
iii No significant changes in the City's opera tions will occur or unusual
accounting problems will arise that would impact the 1990 financial
sta ternents.
.- New arrangements which the City has entered in 1990 w111 be ana.lyzed for
appropriate accounting considerations under generally accepted aCCouIlting
principles and clearly supported with detailed workpapers.
. City personnel will draft the financi.al statements and footnotes and provide
such drafts to us by an agreed upon date.
9 The City will have ava'ilable those i.ndividuals necessary to answer question!';,
prepare analyses, etc., that will arise during the course of the work.
Our proposal contemplates that no additional work. will be required to satisfy
ourselves on significant accounting problems that may uneJ..'Pectedly nrise during tr.e
course of our examination. Should such a situation arise, we would discuss it with
you before undertaking any additional work.
. We appreciate this opportunity to serve you and will be happy to revi€w this letter
with you or members of the City Council at your convenience.
Please indicate your acceptance and understanding of the contents of thiG letter by
signing and returning the enclosed copy.
Very truly yours.
KPMG Peat Manvick.
~~dfi/~ i
i
Steven w. Laible, Partner
SWL:emh
Enclosures
cc: K.. Terese Murphy
Accepted By ---..- I
. Date ~ ._'--~'--~'-~----