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HomeMy WebLinkAboutAddendum No.10114-tv of 4xiami, GLENN MARCOS CARLOS A. MIGOYA Chief Procurement Officer City Manager ADDENDUM NO. I RFP NO. 209202 June 4th, 2010 Request for Proposals for External Auditing Services TO ALL PROSPECTIVE PROPOSERS: The following changes, additions, clarifications and deletions amend the Bid Documents of the above captioned RFP, and shall become an integral part of the Contract Documents. Please note the contents herein and reflect the same on the documents you have on hand. The following are the City's answers to questions received from prospective prosposers concerning the above referenced Solicitation: Q 1: Have the City and the blended component units documented their internal controls over financial reporting for the implementation of the statements on Auditing Standards 104- 111 (the "Risk Assessment" suite)? Al: The Finance Department is in the process of updating all its policies and procedures to include internal controls over financial reporting and does not have such information from the component units. Q2: Please provide the audit fees and audit hours for the prior two (2) years. A2: The audit fees are $390,000.00 for 2008 and $410,000.00 for 2009. Information on the audit hours is not available. Q3: Please provide a copy of the management letter comments for the most recent two (2) years. A3: Attachments B and C herein the Header section of the Solicitation provide the management letter comments available for 2007 and 2008. Such information has not yet been issued for 2009. Q4: How has the City determined to address the implementation for the GASB 51, specifically relating to internal software development costs or the costs associated with the implementation of purchased software? A4: The City has reviewed the Standard and intends to implement the guidance effective September 300', 2010. However, the City's current accounting practices for software development costs are for the most part consistent with the provisions of the GASB 51 Standard. Some reclassifications may or may not be required, but their necessity will be determined upon complete assessment of the costs incurred. Q5: Do the City and the blended component units prepare their own financial statements, notes to the financial statements, the introductory section, the statistical sections and the required supplementary information sections? A5 The City prepares its own financial statements, notes, etc.; however, the City requires the assistance of the external auditors for certain areas. Component unit financials are prepared by their own auditors. Q6: Approximately how many and what types of audit entries were made in the prior year for the City and the blended component units and is this typical? A6: The adjusting journal entries (AJE's) are approximately 25 for the City and 5 for each of the component units, and consist of the following types: additional revenue and expenditure accruals, reclass entries, and recording deferred revenues. This is the norm. Q7: Does the City or any of the other entities outsource any functions to third parties such as payroll or claims processing? If so, does the City receive third party service auditor reports (SAS 70 reports)? A7: Claims processing is outsourced and an SAS 70 report is received for the same. Q8: Have there been any changes in the City's and the other entities' insurance since fiscal year 2009? A8: There have been no changes in the medical, workers compensation or general liability insurance. Q9: Who calculates the IBNR for the City? A9: The City's staff calculates the IBNR with information/reports provided by the medical claims processing company. Q 10: In development of the estimated audit fees, are there any significant changes affecting the financial statements that we should be aware of? A10: None that can be foreseen at this time. Q11: Does the City or the other entities anticipate having any new bond issues for 2010 other than those documented in the subsequent events footnote? Al l: Yes, there will be two (2) bond issuances through the CRA. (SEOPW and OMNI). The expected issuance is in September of 2010. Q12: Who calculates the current arbitrage liability for the City and how often is this calculation updated? Al2: First Southwest Company calculates the arbitrage every two (2) years. Q13: Approximately how many cash and investment accounts are maintained for all the entities, inclusive of the pooled investment accounts? A13: There are eight (8) City -prepared bank reconciliations for the cash accounts. The City utilizes pooled -cash. The investment accounts are with one (1) investment bank, but each of the asset classes in the City's portfolio are tracked and managed individually. Q14: Are all cash and investment accounts reconciled on a monthly basis with investments adjusted to fair values? For the alternative investment, how timely are the partners financial statements provided to the investment managers for determination of fair value? A14: Investments are marked to market monthly. Q15: Has there been an analysis of the effectiveness of the derivative/hedge instruments in the current audit period, and with what conclusion? How has the City prepared for the change in presentation with the implementation of the Governmental Accounting Standards #53? A15: The City does not use derivative/hedge instruments. Q16: What policies and procedures has the City implemented to prepare for the implementation of Governmental Accounting Standard #54, the Fund Balance Reporting and the Governmental Fund Type Definitions? A16: The City has reviewed the provisions of the GASB 54 and intends to implement the associated guidance effective September 30`h, 2011. Any policies and procedures associated with the Standard will require adherence with the tenants of the Standard. Q17: Please provide a copy of the Single Audit Reports for the two (2) most recent fiscal years. A17: This information is available on the City's website www.miamiggv.com under the Finance Department — Financial Information. Q18: Is there a centralized grant management function or are the records kept in individual departments? Alb: No, this is a decentralized function throughout the City's departments. Q19: Does the City anticipate receiving and expending ARRA funding and, if so, at what level and how many programs? A19: The City has received and is spending ARRA dollars per Attachment D herein the Header section of this Solicitation. Q20: Are there any significant chances in funding of other grants? A20: None are known at this time. Q21: Does the City require the auditors to issue separate Pension statements? A21: No. Q22: Have there been any significant changes or system conversions within the IT enviromnent in the last year? A22: Yes, the HRJPayroll ERP system was implemented in June of 2009. Q23: Is the City performing customization or developing changes to Oracle? If so, please describe the nature and frequency of the change. Are the changes performed by a City employee or third party? Is there a process in place to manage changes to the system? A23: The City is working on the stabilization of the HR/Payroll implementation. Most of the customizations consist of new reports, modifications to the approval processes (workflow) and the creation of new payroll elements to accommodate retro functionality. Yes, the customizations are designed, developed, and tested thereafter approval and they are applied by a combination of City employees and third party consultants. There is a process for testing and promoting these customizations from Development to Production. Q24: Is the Oracle server located on-site or is it at another location (i.e. a Data Center)? A24: It is located off-site at the Police Data Center. Q25: Are there any other financial applications or systems that communicate with the Oracle system? A25: Yes, there are such applications/systems which include the following: the POS (Cashiering System), the ARCV (Property -Based Billing System), the BZ (Building and Zoning Billing System), the BA (Burglar Alarm Billing System), Kronos (Time Capture System), and Neogov (Hiring/Employee Qualification System). Q26: Please provide a summary of planned implementations, conversions, or other significant information technology projects planned in the next year. A26: Such summary includes the following: the Payroll Stabilization, the POS Upgrade, the Land Management Implementation, the Mainframe Replatforming, the Oracle R12 Upgrade, and the Oracle E -Business Replatforming. Q27: Please provide a high-level summary of IT personnel and staffing across the City of Miami. A27: IT is divided into the following four (4) specialized sections: Technical Services, Telecommunications, Systems and Programming, and the ERP. Some of these business units have project managers and business analysts who address the interface with IT/ERR Q28: Please provide a summary of how IT policies and procedures are implemented and documented at each data center. Are said suminaries formalized, are they customized by location and data center, or are they centralized and consistent across the City? A28: There is only one (1) Data Center and the IT Policies are consistent all throughout the City. Said policies are reviewed and updated, in most cases, every two (2) years or depending on the specific heeds at the time. Q29: Does the City anticipate an increase in the number of major funds over the course of the next year? A29: At this time this cannot be determined. Such major funds can fluctuate from between five (5) to eight (8) in number. Q30: Has the City implemented policies and/or procedures to address the single audit findings from the prior year? A30: The City does implement policies/procedures to address single audit findings from year to year; however, some remedies extend beyond a one (1) fiscal year period. ALL OTHER TERMS AND CONDITIONS OF THE RFP REMAIN THE SAME. Sincerely, Cz>-1 on e aL—� lenn Mar sP0, CPPB, FCPM, FCPA irector/Chi f' -"'r cyrement Officer k,