HomeMy Public PortalAboutNowlen Agmt 2011, 2012, & 2013ww
&M
NOWLEN, HOLT & MINER, P.A.
CERTIFIED PUBLIC ACCOUNTANTS
WEST PALM BEACH OFFICE
215 FH`TH STREET, SUITE 200
POST OFFICE BOX 347
WEST PALM BEACH, FLORIDA 33402-0347
TELEPHONE (561) 659.30W
FAX (561) 535-0628
WWWNHMCPA.COM
September 21, 2011
The Honorable Mayor and Members of the Town Commission
Town of Gulf Stream, Florida
100 Sea Road
Gulf Stream, FL 33483
EVERETT B. NOWLEN (1890.19841, CPA
EDWARD T HOLT, CPA
WILLIAM B. MINER, CPA
ROBERT W. HENDRIX, JR., CPA
JANET R. BARICEVICH, CPA
KATILEENA.MINER,CPA
TERRY L MORTON. JR.. CPA
N. RONALD BENNETT, CPA
J. MICHAEL STEVENS, CPA
ALEXIA O. VARGA, CPA
BRIAN J. BRESCIA, CFP', CPA
KARA O. PETERSON, CPA
EDWARD T. HOLT, JR., CPA
BELLE GLADE OFFICE
333 S.E. 74Id STREET
POST OFFICE BOX 338
BELLE GLADE, FLORIDA 33430-033B
TELEPHONE (561) 996-5612
FAX (561) 996A248
We are pleased to confirm our understanding of the services we are to provide the Town of Gulf Stream,
Florida for the years ended September 30, 2011, 2012, and 2013. This contract is being renewed in
accordance with Florida Statutes, Chapter 218.391 sub -sections (7) and (8) in their entirety.
We will audit the financial statements of the governmental activities, the business -type activities, each
major fund, and the aggregate remaining fund information, which collectively comprise the basic
financial statements, of the Town of Gulf Stream, Florida as of and for the years ended September 30,
2011, 2012, and 2013. Accounting standards generally accepted in the United States provide for certain
required supplementary information (RSI), such as management's discussion and analysis (MD&A), to
supplement the Town of Gulf Stream, Florida's basic financial statements. Such information, although
not a part of the basic financial statements, is required by the Governmental Accounting Standards
Board who considers it to be an essential part of financial reporting for placing the basic financial
statements in an appropriate operational, economic, or historical context. As part of our engagement, we
will apply certain limited procedures to the Town of Gulf Stream, Florida's RSI in accordance with
auditing standards generally accepted in the United States of America. These limited procedures will
consist of inquiries of management regarding the methods of preparing the information and comparing
the information for consistency with management's responses to our inquiries, the basic financial
statements, and other knowledge we obtained during our audit of the basic financial statements. We will
not express an opinion or provide any assurance on the information because the limited procedures do
not provide us with sufficient evidence to express an opinion or provide any assurance.. The following
RSI is required by generally accepted accounting principles and will be subjected to certain limited
procedures, but will not be audited:
1) Management's Discussion and Analysis.
2) Budgetary Comparison Schedule — General Fund
3) Schedule of Funding Progress — Other Post Employment Benefits
Supplementary information other than RSI also accompanies the Town of Gulf Stream, Florida's
financial statements. We will subject the following supplementary information to the auditing
procedures applied in our audit of the financial statements and certain additional procedures, including
comparing and reconciling such information directly to the underlying accounting and other records
used to prepare the financial statements or to the financial statements themselves, and other additional
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS • FLORIDA INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS • CPAMERICA INTERNATIONAL
procedures in accordance with auditing standards generally accepted in the United States of America
and will provide an opinion on it in relation to the financial statements as a whole:
1) Schedule of Expenditures of Federal Awards and State Financial Assistance, if applicable.
Audit Objectives
The objective of our audit is the expression of opinions as to whether your basic financial statements are
fairly presented, in all material respects, in conformity with U.S. generally accepted accounting
principles and to report on the fairness of the supplementary information referred to in the second
paragraph when considered in relation to the financial statements as a whole. The objective also includes
reporting on—
• Internal control related to the financial statements and compliance with laws, regulations, and the
provisions of contracts or grant agreements, noncompliance with which could have a material
effect on the financial statements in accordance with Government Auditing Standards.
• Internal control related to major programs and an opinion (or disclaimer of opinion) on
compliance with laws, regulations, and the provisions of contracts or grant agreements that could
have a direct and material effect on each major program in accordance with the Single Audit Act
Amendments of 1996 and OMB Circular A-133, Audits of States, Local Governments, and Non -
Profit Organizations, and Rules of the Auditor General Chapter 10.550.
The reports on internal control and compliance will each include a statement that the report is intended
solely for the information and use of management, the body or individuals charged with governance,
others within the entity specific legislative or regulatory bodies, federal awarding agencies, and if
applicable, pass-through entities and is not intended to be and should not be used by anyone other than
these specified parties.
Our audit will be conducted in accordance with auditing standards generally accepted in the United
States of America; the standards for financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States; the Single Audit Act Amendments of 1996; and
the provisions of OMB Circular A-133, and will include tests of accounting records, a determination of
major program(s) in accordance with OMB Circular A-133 and state projects in accordance with Rules
of the Auditor General Chapter 10.550, and other procedures we consider necessary to enable us to
express such opinions and to render the required reports. If our opinions on the financial statements or
the Single Audit compliance opinions are other than unqualified, we will fully discuss the reasons with
you in advance. If, for any reason, we are unable to complete the audit or are unable to form or have not
formed opinions, we may decline to express opinions or to issue a report as a result of this engagement.
Management Responsibilities
Management is responsible for the basic financial statements and all accompanying information as well
as all representations contained therein. Management is also responsible for identifying government
award programs and understanding and complying with the compliance requirements, and for
preparation of the schedule of expenditures of federal awards in accordance with the requirements of
OMB Circular A-133. As part of the audit, we will assist with preparation of your financial statements,
schedule of expenditures of federal awards, and related notes. You are responsible for making all
management decisions and performing all management functions relating to the financial statements,
schedule of expenditures of federal awards, and related notes and for accepting full responsibility for
such decisions. You will be required to acknowledge in the management representation letter our
assistance with preparation of the financial statements and the schedule of expenditures of federal
awards and that you have reviewed and approved the financial statements, schedule of expenditures of
F�
federal awards, and related notes prior to their issuance and have accepted responsibility for them.
Further, you are required to designate an individual with suitable skill, knowledge, or experience to
oversee any nonaudit services we provide and for evaluating the adequacy and results of those services
and accepting responsibility for them.
Management is responsible for establishing and maintaining effective internal controls, including
internal controls over compliance, and for evaluating and monitoring ongoing activities, to help ensure
that appropriate goals and objectives are met and that there is reasonable assurance that government
programs are administered in compliance with compliance requirements. You are also responsible for
the selection and application of accounting principles; for the fair presentation in the financial statements
of the respective financial position of the governmental activities, the business -type activities, each
major fund, and the aggregate remaining fund information of the Town of Gulf Stream, Florida and the
respective changes in financial position and, where applicable, cash flows in conformity with U.S.
generally accepted accounting principles; and for compliance with applicable laws and regulations and
the provisions of contracts and grant agreements.
Management is also responsible for making all financial records and related information available to us
and for ensuring that management and financial information is reliable and properly recorded. Your
responsibilities also include identifying significant vendor relationships in which the vendor has
responsibility for program compliance and for the accuracy and completeness of that information. Your
responsibilities include adjusting the financial statements to correct material misstatements and
confirming to us in the representation letter that the effects of any uncorrected misstatements aggregated
by us during the current engagement and pertaining to the latest period presented are immaterial, both
individually and in the aggregate, to the financial statements taken as a whole.
You are responsible for the design and implementation of programs and controls to prevent and detect
fraud, and for informing us about all known or suspected fraud or illegal acts affecting the government
involving (1) management, (2) employees who have significant roles in internal control, and (3) others
where the fraud or illegal acts could have a material effect on the financial statements. Your
responsibilities include informing us of your knowledge of any allegations of fraud or suspected fraud
affecting the government received in communications from employees, former employees, grantors,
regulators, or others. In addition, you are responsible for identifying and ensuring that the entity
complies with applicable laws, regulations, contracts, agreements, and grants. Additionally, as required
by OMB Circular A-133, it is management's responsibility to follow up and take corrective action on
reported audit findings and to prepare a summary schedule of prior audit findings and a corrective action
plan. You are responsible for the preparation of the supplementary information in conformity with U.S.
generally accepted accounting principles.
Management is responsible for establishing and maintaining a process for tracking the status of audit
findings and recommendations. Management is also responsible for identifying for us previous financial
audits, attestation engagements, performance audits, or other studies related to the objectives discussed
in the Audit Objectives section of this letter. This responsibility includes relaying to us corrective
actions taken to address significant findings and recommendations resulting from those audits,
attestation engagements, performance audits, or studies. You are also responsible for providing
management's views on our current findings, conclusions, and recommendations, as well as your
planned corrective actions, for the report, and for the timing and format for providing that information.
Audit Procedures—General
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements; therefore, our audit will involve judgment about the number of transactions to be
M
examined and the areas to be tested. We will plan and perform the audit to obtain reasonable rather than
absolute assurance about whether the financial statements are free of material misstatement, whether
from (1) errors, (2) fraudulent financial reporting, (3) misappropriation of assets, or (4) violations of
laws or governmental regulations that are attributable to the entity or to acts by management or
employees acting on behalf of the entity. Because the determination of abuse is subjective, Government
Auditing Standards do not expect auditors to provide reasonable assurance of detecting abuse.
Because an audit is designed to provide reasonable, but not absolute assurance and because we will not
perform a detailed examination of all transactions, there is a risk that material misstatements or
noncompliance may exist and not be detected by us. In addition, an audit is not designed to detect
immaterial misstatements or violations of laws or governmental regulations that do not have a direct and
material effect on the financial statements or major programs. However, we will inform you of any
material errors and any fraudulent financial reporting or misappropriation of assets that come to our
attention. We will also inform you of any violations of laws or governmental regulations that come to
our attention, unless clearly inconsequential, and of any material abuse that comes to our attention. We
will include such matters in the reports required for a Single Audit. Our responsibility as auditors is
limited to the period covered by our audit and does not extend to any later periods for which we are not
engaged as auditors.
Our procedures will include tests of documentary evidence supporting the transactions recorded in the
accounts, and may include tests of the physical existence of inventories, and direct confirmation of
receivables and certain other assets and liabilities by correspondence with selected individuals, funding
sources, creditors, and financial institutions. We will request written representations from your attorneys
as part of the engagement, and they may bill you for responding to this inquiry. At the conclusion of our
audit, we will require certain written representations from you about the financial statements and related
matters.
Audit Procedures—Internal Controls
Our audit will include obtaining an understanding of the entity and its environment, including internal
control, sufficient to assess the risks of material misstatement of the financial statements and to design
the nature, timing, and extent of further audit procedures. Tests of controls may be performed to test the
effectiveness of certain controls that we consider relevant to preventing and detecting errors and fraud
that are material to the financial statements and to preventing and detecting misstatements resulting from
illegal acts and other noncompliance matters that have a direct and material effect on the financial
statements. Our tests, if performed, will be less in scope than would be necessary to render an opinion
on internal control and, accordingly, no opinion will be expressed in our report on internal control issued
pursuant to Government Auditing Standards.
As required by OMB Circular A-133 and Rules of the Auditor General Chapter 10.550, we will perform
tests of controls over compliance to evaluate the effectiveness of the design and operation of controls
that we consider relevant to preventing or detecting material noncompliance with compliance
requirements applicable to each major federal award program. However, our tests will be less in scope
than would be necessary to render an opinion on those controls and, accordingly, no opinion will be
expressed in our report on internal control issued pursuant to OMB Circular A-133 and Rules of the
Auditor General Chapter 10.550..
An audit is not designed to provide assurance on internal control or to identify significant deficiencies.
However, during the audit, we will communicate to management and those charged with governance
internal control related matters that are required to be communicated under AICPA professional
standards, Government Auditing Standards, and OMB Circular A-133.
Audit Procedures—Compliance
As part of obtaining reasonable assurance about whether the financial statements are free of material
misstatement, we will perform tests of the Town of Gulf Stream, Florida's compliance with applicable
laws and regulations and the provisions of contracts and agreements, including grant agreements.
However, the objective of those procedures will not be to provide an opinion on overall compliance and
we will not express such an opinion in our report on compliance issued pursuant to Government
Auditing Standards.
OMB Circular A-133 requires that we also plan and perform the audit to obtain reasonable assurance
about whether the auditee has complied with applicable laws and regulations and the provisions of
contracts and grant agreements applicable to major programs. Our procedures will consist of tests of
transactions and other applicable procedures described in the OMB Circular A-133 Compliance
Supplement and related addenda for the types of compliance requirements that could have a direct and
material effect on each of the Town of Gulf Stream, Florida's major programs. The purpose of these
procedures will be to express an opinion on the Town of Gulf Stream, Florida's compliance with
requirements applicable to each of its major programs in our report on compliance issued pursuant to
OMB Circular A-133.
Engagement Administration, Fees, and Other
We understand that your employees will prepare all cash, accounts receivable, or other confirmations we
request and will locate any documents selected by us for testing.
At the conclusion of the engagement, we will complete the appropriate sections of the Data Collection
Form that summarizes our audit findings. It is management's responsibility to submit the reporting
package (including financial statements, schedule of expenditures of federal awards, summary schedule
of prior audit findings, auditors' reports, and corrective action plan) along with the Data Collection
Form to the federal audit clearinghouse. We will coordinate with you the electronic submission and
certification. If applicable, we will provide copies of our report for you to include with the reporting
package you will submit to pass-through entities. The Data Collection Form and the reporting package
must be submitted within the earlier of 30 days after receipt of the auditors' reports or nine months after
the end of the audit period, unless a longer period is agreed to in advance by the cognizant or oversight
agency for audits.
The audit documentation for this engagement is the property of Nowlen, Holt & Miner, P.A. and
constitutes confidential information. However, pursuant to authority given by law or regulation, we may
be requested to make certain audit documentation available to a regulatory agency or its designee, a
federal agency providing direct or indirect funding, or the U.S. Government Accountability Office for
purposes of a quality review of the audit, to resolve audit findings, or to carry out oversight
responsibilities. We will notify you of any such request. If requested, access to such audit documentation
will be provided under the supervision of Nowlen, Holt & Miner, P.A. personnel. Furthermore, upon
request, we may provide copies of selected audit documentation to the aforementioned parties. These
parties may intend, or decide, to distribute the copies or information contained therein to others,
including other governmental agencies.
The audit documentation for this engagement will be retained for a minimum of five years after the
report release or for any additional period requested by a federal awarding agency, state awarding
agency, or pass-through entity. If we are aware that a federal awarding agency, pass-through entity, or
auditee is contesting an audit finding, we will contact the party(ies) contesting the audit finding for
guidance prior to destroying the audit documentation.
I
Edward T. Holt is the engagement partner and is responsible for supervising the engagement and signing
the reports or authorizing another individual to sign them. Our fee for these services will be $15,050 for
each year. If a Single Audit is required, the fee will be $4,500 per major program. Our invoices for these
fees will be rendered each month as work progresses and are payable on presentation. In accordance
with our firm policies, work may be suspended if your account becomes overdue and may not be
resumed until your account is paid in full. If we elect to terminate our services for nonpayment, our
engagement will be deemed to have been completed upon written notification of termination, even if we
have not completed our report(s). You will be obligated to compensate us for all time expended and to
reimburse us for all out-of-pocket costs through the date of termination. The above fee is based on
anticipated cooperation from your personnel and the assumption that unexpected circumstances will not
be encountered during the audit. If significant additional time is necessary, we will discuss it with you
and arrive at a new fee estimate before we incur the additional costs.
Government Auditing Standards require that we provide you with a copy of our most recent external
peer review report and any letter of comment, and any subsequent peer review reports and letters of
comment received during the period of the contract. Our 2009 peer review report accompanies this letter.
We appreciate the opportunity to be of service to the Town of Gulf Stream, Florida and believe this
letter accurately summarizes the significant terms of our engagement. If you have any questions, please
let us know.
Very truly yours,
2 0 �� �'
Nowlen, Holt & Miner, P.A.
RESPONSE:
This letter correctly sets forth the understanding of the Town of Gulf Stream, Florida.
By:
Title: Mayor
Date: 9-22-11
System Review Report
JPifiedS
public accountants
December 4, 2009
To the Shareholders of Nowlen, Holt & Miner, P.A.
and the Peer Review Committee of the Florida Institute of Certified Public Accountants
We have reviewed the system of quality control for the accounting and auditing practice of Nowlen,
Holt & Miner, P.A. (the firm) in effect for the year ended May 31, 2009. Our peer review was
conducted in accordance with the Standards for Performing and Reporting on Peer Reviews
established by the Peer Review Board of the American Institute of Certified Public Accountants. The
firm is responsible for designing a system of quality control and complying with it to provide the firm
with reasonable assurance of performing and reporting in conformity with applicable professional
standards in all material respects. Our responsibility is to express an opinion on the design of the
system of quality control and the firm's compliance therewith based on our review. The nature,
objectives, scope, limitations of, and the procedures performed in a System Review are described in
the standards at www.aicpa.org/prsummary.
As required by the standards, engagements selected for review included engagements performed
under the Government Auditing Standards and audits of employee benefit plans.
In our opinion, the system of quality control for the accounting and auditing practice of Nowlen, Holt &
Miner, P.A. in effect for the year ended May 31, 2009, has been suitably designed and complied with to
provide the firm with reasonable assurance of performing and reporting in conformity with applicable
professional standards in all material respects. Firms can receive a rating of pass, pass with
deficiency(ies) or fail. Nowlen, Holt & Miner, P.A. has received a peer review rating of pass.
Johnson, Price & Sprinkle, PA
79 Woodfin Place, Suite 300 • Asheville, NC 28801 • 828.254.2374 • Fax 252.9994 • www.jpspa.com
A Member of the CPAmerica International Network.