HomeMy Public PortalAboutResolution 2020-12, Approving Agreement With Bohnsack And Frommert To Provide Accounting Services For City Until June 30, 2021 RESOLUTION 2020- 12
A RESOLUTION APPROVING AN AGREEMENT WITH BOHNSACK AND
FROMMERT TO PROVIDE ACCOUNTING SERVICES FOR THE CITY OF
RIVERDALE UNTIL JUNE 30, 2021
WHEREAS, the City of Riverdale, Iowa ("City") is a Municipal Corporation, organized and
operating under the laws of the State of Iowa;
WHEREAS, the City Council must assure that the financial work of the City is completed
by a competent employee or firm, and;
WHEREAS, the Mayor and Administrator have reviewed the qualifications of the
accounting and auditing firm Bohnsack and Frommelt who perform pubic accounting
and auditing work in the State of Iowa, and;
WHEREAS, the firm of Bohnsack and Frommelt have presented a proposal attached as
Exhibit A to complete the work of accounts payable, bank reconciliation, financial
reporting, utility billing and payroll until June 30, 2021 .
NOW THEREFORE, BE IT RESOLVED, that the City Council of the City of Riverdale, Iowa
authorizes the Mayor, Clerk and City Administrator to execute the agreement and take
appropriate action to allow the firm Bohnsack and Frommelt to begin performing the
accounting and financial work of the City as soon as possible.
assed and approved this 28th day of January 2020.
• hael Bawden, ayor
ATTEST:
V,4 a-14r 4 Aj) /(7,41
Mary Fr, nces Blevins, City Clerk-Treasurer
City of Riverdale,Iowa 110 Manor Drive,Riverdale, Iowa 52722•(563)355-2511 •www.riverdaleiowa.com
BBohnsack & Frommelt LLP
Certified Public Accountants
1500 River Drive,Suite 200
Moline,Illinois 61265
www.governmentalservice.com
January 14, 2020
To the Honorable Mayor and
Members of City Council
City of Riverdale, Iowa 52722
Attention: Lisa Kotter, City Administrator
We are pleased to provide you with the professional services described below. This letter confirms our
understanding of the terms and objectives of our engagement and the nature and limitations of the services
we will provide. The engagement between you and our firm will be governed by the terms of this
Agreement.
Engagement Objective and Scope
We will provide technical advice and assistance to the City of Riverdale, Iowa as requested by you during
the year. This service includes all calls and meetings as well as specific tasks and projects requested for
the City to enter, reconcile, report and maintain the financial records and systems of the City. Specifically,
we will provide:
• Disbursements/Accounts Payable: The City will receive all invoices, review invoices for propriety
and account code expenditures. We will obtain the coded invoices, enter the invoices into the
financial system and generate checks for each board meeting. The checks and supporting invoices
will be provided to the City Administrator for the Mayor and/or members of Council to review and
to sign. The City will distribute the invoices for payment after approval. Our understanding is the
City pays bills twice a month.
• Payroll: The City will maintain all personnel files including approved hourly rates and benefits. The
City will gather completed and approved timesheets of all hourly employees. We will process
payroll for the City. All City payroll checks will be provided to the City Administrator for the Mayor's
signature and distribution. We will prepare payroll reports from the City's financial system and
electronically file the necessary payroll returns. Our understanding is the City does not currently
have a payroll calendar. We will work with the City Administrator to establish a payroll calendar.
• Utility Billing and Accounting: The City will obtain the sanitary sewer consumption reports from
Iowa Water. Quarterly, we will generate sanitary sewer bills for the City to mail. We will also
establish a process to maintain utility billing records to report accounts receivable and delinquent
accounts. All utility billing receipts will be receipted by the City.
• Bank Reconciliations: We will prepare monthly bank reconciliations of the City's depository and
investment accounts. The City Administrator will review the bank reconciliations.
City of Riverdale, Iowa
21
• Other Services: We will assist the City with ensuring the City's chart of accounts follows the state
of Iowa municipal chart of accounts requirements. We will prepare a financial reporting packet for
the City Administrator to use for reporting to City Council. We will assist the City Administrator with
quarterly financial analysis. We will prepare a City external financial reporting calendar to ensure
compliance with state requirements. We will have a Partner of the Firm on site during the annual
review from the State Auditor. In addition, when the State Auditor staff discuss the report and
findings from the procedures performed a Partner of the Firm will be present.
As a condition to our performing the services described above, you agree to:
• make all management decisions and perform all management functions
• designate an individual who possesses suitable skill, knowledge, and/or experience, preferably
within senior management, to oversee the services;
• evaluate the adequacy and results of the services performed;
• establish and maintain internal controls and monitor ongoing activities with respect to the
services provided; and
• accept responsibility for the results of the services;
You agree that management is responsible for the proper recording of transactions in the records, the
safekeeping of assets, and the accuracy of the financial statements.
This engagement is limited to the professional services outlined above and on Attachment A. Bohnsack
& Frommelt LLP, in its sole professional judgment, reserves the right to refuse to take any action that
could be construed as making management decisions or performing management functions.
The professional services will be performed based on the information that you and others provide to us.
We will not verify or audit the information that you and others provide to us. Our engagement cannot be
relied upon to disclose errors, theft, fraud, or illegal acts. However, we will inform the appropriate level of
management of any material errors, and of any evidence or information that comes to our attention during
the performance of our engagement that fraud may have occurred. In addition, we will report to you any
evidence or information that comes to our attention during the performance of our engagement regarding
illegal acts that may have occurred.
In the event we are requested to prepare financial reports or financial summaries, we will prepare the
requested reports from information the City provides. The engagement approach and client responsibilities
are included in Attachment A if we are requested to provide financial reports or summaries. By signing this
Agreement, you acknowledge and agree to Attachment A requirements for financial statement preparation
services. The objective of our engagement is to prepare financial statements based upon information that
you provide to us. We will utilize information provided to us as the representations of management, without
undertaking to obtain or provide any assurance that there are no material modifications that should be made
to the financial statements in order for the statements to be in conformity with U.S. generally accepted
accounting principles or the prescribed basis requested.
The prepared financial statements and summaries will not be accompanied by a report.
City of Riverdale, Iowa
31
Timing of Engagement
This agreement will become effective upon City Council approval in January 2020 and remain in effect
through June 30, 2021. This agreement may be renewed and extended on a year-to-year basis on the
terms and conditions as set forth herein as agreed to by both parties annually. Should the City wish not
to renew this agreement, written notice shall be given to Bohnsack & Frommelt LLP not less than thirty
days prior to the expiration date.
Bohnsack & Frommelt LLP and the City both may voluntarily resign from this agreement before the
expiration of this contract.
Professional Fees
Our professional fee for the services described above is $2,500 per month. Services outside of the scope
of this agreement will be billed at $75 per hour. This fee is based upon the complexity of the work to be
performed, and our professional time to complete the work, as well as out-of-pocket expenses. In addition,
this fee depends upon the timely delivery, availability, quality, and completeness of your records.You agree
that you will deliver all records requested and respond to all inquiries made by our staff to complete this
engagement on a timely basis.
We will track the hours incurred to perform the procedures above. Both parties agree to meet in Spring
2021 to determine the hourly plan and associated billing to prepare for the possible renewal of the contract.
We appreciate the opportunity to be of service to City of Riverdale, Iowa. Please date and sign the enclosed
copy of this Agreement and return it to us to acknowledge your agreement with its terms.
Respectfully,
Bohnsack& Frommelt LLP
,.
Mia Frommelt, Partner
***************************************************************
RESPONSE:
This letter correctly sets forth our understanding.
City of Riverd -, o v=
Approved b • .
Title: 7 � 0,
AZtVilin V
Date: I I �q/ D I?eStf'tc 1
THIS PAGE INTENTIONALLY LEFT BLANK
Attachment A January 14,2020
City of Riverdale, Iowa
Engagement Approach and Client Responsibilities for Financial Statement Preparation
In the event we are requested to prepare financial reports or financial summaries, we will prepare the
requested reports from information the City provides. The objective of our engagement is to prepare
financial statements based upon information that you provide to us. We will utilize information provided to
us as the representations of management, without undertaking to obtain or provide any assurance that
there are no material modifications that should be made to the financial statements in order for the
statements to be in conformity with U.S. generally accepted accounting principles or the prescribed basis
requested.
The prepared financial statements and summaries will not be accompanied by a report.
Engagement Approach
We will conduct our engagement in accordance with the Statements on Standards for Accounting and
Review Services issued by the American Institute of Certified Public Accountants ("SSARS") and comply
with the AICPA's Code of Professional Conduct, including the ethical principles of integrity, objectivity,
professional competence, and due care.
Financial statement preparation differs significantly from an engagement to compile financial statements,
or a review or audit of financial statements. Compilation procedures require the accountant to consider
whether the financial statements appear to be appropriate in form and free from obvious material
misstatements. A financial statement preparation does not include such procedures. In addition, a financial
statement preparation also does not contemplate performing inquiry, analytical procedures, or other
procedures ordinarily performed in a review. Finally, a financial statement preparation does not
contemplate obtaining an understanding of the entity's internal controls, assessing fraud risk, testing
accounting records by obtaining sufficient appropriate audit evidence through inspection, observation,
confirmation, or the examination of source documents (for example, cancelled checks or bank images), or
other procedures ordinarily performed in an audit.
We are not required to, and will not, verify the accuracy or completeness of the information you will provide
to us for the engagement or otherwise gather evidence for the purpose of expressing an opinion or a
conclusion. Accordingly, we will not express an opinion or a conclusion or provide any assurance on the
financial statements.
Each page of the financial statements will include a legend with the following items:
• A statement indicating that the financial statements have not been subjected to an audit or review
or compilation engagement, and that no assurance is provided on them.
• If applicable, a statement on whether the financial statements contain any known departures from
U.S. generally accepted accounting principles (or other applicable financial reporting framework),
including inadequate disclosure.
• If applicable, a statement on whether the financial statements omit substantially all required
disclosures.
If we are unable to include a legend on each page, we will issue a disclaimer that makes clear that no
assurance is provided on the financial statements.
If we become aware of records, documents, explanations, or other information, including significant
judgments, used in preparation of the financial statement that are incomplete, inaccurate, or otherwise
unsatisfactory, we will bring this information to the attention of management and request additional or
corrected information.
1
Attachment A January 14, 2020
City of Riverdale, Iowa
Engagement Approach and Client Responsibilities for Financial Statement Preparation
Our engagement cannot be relied upon to identify or disclose any financial statement misstatements,
including those caused by fraud or error, or to identify or disclose any wrongdoing within the entity or
noncompliance with laws or regulations.
You agree that you are not and will not be entitled to rely on any advice given to you by us unless it is
requested and provided in writing.
Client Responsibilities
The engagement to be performed is conducted on the basis that management acknowledges and
understands that our role is to prepare financial statements in accordance with U.S. generally accepted
accounting principles or in accordance with a basis of accounting you have specifically requested.
Management has the following overall responsibilities that are fundamental to our undertaking the
engagement to prepare your financial statements in accordance with SSARS:
• the selection of the financial reporting framework to be applied in the preparation and fair
presentation of the financial statements;
• designing, implementing, and maintaining internal control relevant to the preparation and fair
presentation of the financial statements that are free from material misstatement, whether due to
fraud or error;
• preventing and detecting fraud, including the design and implementation of programs and controls
to prevent and detect fraud;
• ensuring that City of Riverdale, Iowa complies with the laws and regulations applicable to its
activities;
• ensuring the accuracy and completeness of the records, documents, explanations, and other
information, including significant judgments, that you provide to us for the preparation of financial
statements; and
• providing us with:
access to all information of which management is aware that is relevant to the preparation
and fair presentation of the financial statements, such as records, documentation, and
other matters:
additional information that may be requested for the purpose of the preparation of the
financial statements; and
unrestricted access to persons within City of Riverdale, Iowa of whom we determine
necessary to communicate.
Your management is also responsible for:
• making all management decisions and performing all management functions;
• designating an individual who possesses suitable skill, knowledge, and experience, preferably
within senior management, to oversee our services;
• evaluating the adequacy and results of the services performed; and
• accepting responsibility for the results of the services.
During the course of the engagement, we may assist management with judgments regarding amounts or
disclosures to be reflected in the financial statements. We will discuss any such judgments with you, and
you accept responsibility for those judgments.
2
Attachment A January 14, 2020
City of Riverdale, Iowa
Engagement Approach and Client Responsibilities for Financial Statement Preparation
You also acknowledge that independence is not required in order to provide financial statement preparation
services in accordance with the SSARS. The performance of the preparation services may impair
independence unless safeguards are met. We are available to discuss these safeguards with you if you
anticipate the need for services that require independence, such as an audit or review of financial
statements.
3