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HomeMy WebLinkAboutAlbrecht, Viggiano, Zureck & Co PC -Deferred Comp Plan Audit RESOLUTION 2019-272 ADOPTED DOC ID: 15050 THIS IS TO CERTIFY THAT THE FOLLOWING RESOLUTION NO. 2019-272 WAS ADOPTED AT THE REGULAR MEETING OF THE SOUTHOLD TOWN BOARD ON MARCH 26, 2019: RESOLVED that the Town Board of the Town of Southold hereby ratifies the execution of an engagement letter witlu.Albreelil, Vigji2R2 :A greck gn,d Com an P.C. in connection with the audit of the Town of Southold Deferred Compensation Plan as of December 31, 2018, at a fee not to exceed $13,000, that said fee shall be a legal charge to the General Fund Whole Town Independent Auditing and Accounting budget (A.1320.4.500.300), and that said engagement letter is subject to review and approval by the Town Attorney. oq�as*?2?60� Elizabeth A. Neville Southold Town Clerk RESULT: ADOPTED [UNANIMOUS] MOVER: James Dinizio Jr, Councilman SECONDER:William P. Ruland, Councilman AYES: Dinizio Jr, Ruland, Doherty, Ghosio, Evans, Russell CERTIFIED PUBLIC ACCOUNTANTS December 12, 2018 To Honorable Supervisor and Town Board Town of Southold Southold, NY 11791 We are pleased to confirm our understanding of the services we are to provide for the Town of Southold Deferred Compensation Plan ("the Plan")for the years ended December 31, 2018 and 2017 in connection with its annual reporting obligation under the New York State Deferred Compensation Board. Except as described below, we will audit the financial statements of the Plan, which comprise the statements of net assets available for benefits as of December 31, 2018 and 2017 and the related statements of changes in net assets available for benefits for the year ended then ended, and the related notes to the financial statements. Also, the following supplementary schedules accompanying the basic financial statements, as applicable, will be subject to the auditing procedures applied in our audit of the financial statements: 1) Assets (Held at End of Year.) and Assets (Acquired and Disposed of Within Year). 2) Loans or Fixed Income Obligations in Default or Classified as Uncollectible. 3) Leases in Default or Classified as Uncollectible. 4) Reportable Transactions. 5) Nonexempt Transactions. 6) Delinquent Participant Contributions. These financial statements and supplemental schedules are required by the New York State Deferred Compensation Board and will be reported in conformity with the Department of Labor's (DOL) Rules and Regulations for reporting and Disclosure under Employee Retirement Income Security Act of 1974(ERISA). Audit Objective Our audit will be conducted in accordance with auditing standards generally accepted in the United States of America except that,as permitted by Regulation 29 CFR 2520.103-8 of the DOL's Rules and Regulations for Reporting and Disclosure under ERISA and as instructed by you, we will not perform any auditing procedures with respect to information prepared and certified to by Mass Mutual Retirement Services, the trustee, in accordance with DOL Regulation 29 CFR 2520.103-5, other than comparing the information with the related information included in the financial statements and supplemental schedules. Because of the significance of the information that we will not audit, we will not express an opinion on the financial statements and supplemental schedules.We will issue a written report upon completion of our audit of the Plan's financial statements. Our report will be addressed to the Board of Directors and Trustees of the Town of Southold. We cannot provide assurance that a limited-scope disclaimer of opinion as permitted by Regulation 2520.103-8 of the DOL's Rules and Regulations for Reporting and Disclosure under ERISA will be expressed. BEYOND THE NUMBERS... —� ALBRECHT,VIGGIANO,ZURECK&COMPANY, PC. 245 PARK AVENUE,39TH FLOOR 25 SUFFOLK COURT NEW YORK, NY 10167 HAUPPAUGE,NY 11788-3715 T•212.792 4075 T•631.434.9500 F•631 434 9518 www.avz.com INDEPENDENT MEMBER OF BKR INTERNATIONAL 1J Town of Southold December 12, 2018 Page 2 Audit Objective (continued) Circumstances may arise in which it is necessary for us to make further modifications to our report, such as adding an emphasis-of-matter or other-matter paragraph. The form and content of the information included in the financial statements and supplemental schedules, other than that derived from the information certified to by the trustee, will be audited by us in accordance with auditing standards generally accepted in the United States of America, and will be subjected to tests of your accounting records and other procedures we consider necessary to enable us to express an opinion that they are presented in compliance with the DOL's Rules and Regulations for Reporting and Disclosure under ERISA. If for any reason we are unable to complete the engagement, we will not issue a report on this engagement. Audit Procedures Our procedures will include tests of documentary evidence supporting the transactions recorded in the accounts and direct confirmation of investments except those certified to by the trustee, and certain other assets and liabilities by correspondence with financial institutions and other third parties. We may also 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. 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 examined and the areas to be tested, except that assets and related transactions certified to by the trustee will not be tested. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We will plan and perform the audit to obtain reasonable 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, including prohibited transactions with parties in interest or other violations of ERISA rules and regulations, that are attributable to the plan or to acts by management or employees acting on behalf of the plan. Because of the inherent limitations of an audit, combined with the inherent limitations of internal control, and because we will not perform a detailed examination of all transactions, there is a risk that material misstatements may exist and not be detected by us, even though the audit is properly planned and performed in accordance with U.S. generally accepted auditing standards, except as previously noted. 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. However,we will inform the appropriate level of management of any material errors or any fraudulent financial reporting or misappropriation of assets that comes to our attention. We will also inform the appropriate level of management of any violations of laws or governmental regulations that come to our attention, unless clearly inconsequential. 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. Except as described in the "Audit Objective" section, our audit will include obtaining an understanding of the plan 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. An audit is not designed to provide assurance on internal control or to identify deficiencies in internal control. However,during the audit,we will communicate to you and those charged with governance internal control related matters that are required to be communicated under professional standards. In addition,we will perform certain-procedures directed at considering the Plan's compliance with applicable Internal Revenue Service (IRS) requirements for tax exempt status and the NYS Deferred Compensation Board plan qualification requirements. Town of Southold December 12, 2018 Page 3 Audit Procedures (continued) However, you should understand that our audit is not specifically designed for and should not be relied upon to disclose matters affecting plan qualifications or compliance with the NYS Deferred Compensation Board and IRS requirements. If during the audit we become aware of any instances of any such matters or ways in which management practices can be improved, we will communicate them to you. Non Attest Services We will provide the following nonattest services to the Plan as of and for the year ended December 31, 2018: • Assist in the drafting and/or preparation of the financial statements; • Assist in the drafting and/or preparation of footnotes related to the financial statements; • Assistance in adjusting the financial statements as necessary. Management Responsibilities You agree to assume all management responsibilities for the nonattest services noted above; oversee the services by designating an individual, preferably from senior management, with suitable skill, knowledge, and/or experience; evaluate the adequacy and results of the services; and accept responsibility for them. You are responsible for designing, implementing and maintaining internal controls, including monitoring ongoing activities; for the selection and application of accounting principles; for establishing an accounting and financial reporting process for determining fair value measurements; and for the fair presentation in the financial statements of the net assets available for benefits and changes in net assets available for benefits of the plan in conformity with U.S. generally accepted accounting principles. You are also responsible for making all financial records and related information available to us and for the accuracy and completeness of that information, including the completeness and accuracy of the certification by the trustee. You are also responsible for providing us with (1)access to all information of which you are aware that is relevant to the preparation and fair presentation of the financial statements, (2)additional information that we may request for the purpose of the audit, and (3) unrestricted access to persons within the plan from whom we determine it necessary to obtain audit evidence. Your responsibilities include adjusting the financial statements to correct material misstatements and confirming to us in the written management 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 affecting the plan involving (1) plan management, (2) employees who have significant roles in internal control, and (3) others where the fraud 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 plan received in communications from employees, former employees, regulators, or others. In addition, you are responsible for identifying and ensuring that the plan complies with applicable laws and regulations. With regard to the electronic dissemination of audited financial statements, including financial statements published electronically on your Internet website, you understand that electronic sites are a means to distribute information and, therefore, we are not required to read the information contained in these sites or to consider the consistency of other information in the electronic site with the original document. You are required to disclose the date through which subsequent events have been evaluated and whether that date is the date the financial statements were issued or were available to be issued. You agree that you will not date the subsequent event note earlier than the date of your management representation letter. Town of Southold December 12, 2018 Page 4 Engagement Administration, Fees, and Other We understand that your personnel will prepare schedules, analyses, and all confirmations we request and will locate any invoices or other documents selected by us for testing. The audit documentation for this engagement is the property of Albrecht, Viggiano, Zureck & Company, P.C. and constitutes confidential information. However, we may be requested to make certain audit documentation available to the U.S. Department of Labor pursuant to authority given to it by law. If requested,access to such audit documentation will be provided under the supervision of Albrecht,Viggiano, Zureck & Company, P.C. personnel. Furthermore, upon request, we may provide copies of selected audit documentation to the U.S. Department of Labor. The U.S. Department of Labor may intend, or decide, to distribute the copies of information contained therein to others, including other governmental agencies. Robert S. Posner is the engagement partner and is responsible for supervising the engagement and signing the report or authorizing another individual to sign it. We will begin our audit on a mutually agreed upon date. We estimate our fees for this service will be $13,000 for the audit of the plan enumerated above. Our fee will be 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. 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 thirty days or more overdue and will 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. You will be obligated to compensate us for all time expended and to reimburse us for all out-of-pocket expenditures through the date of termination. Please note that the fee does not include any accounting services, preparation of reconciliations, and similar services. The fee assumes that the reports from the third party providers are accurate, and there are no significant plan noncompliance issues. You may request that we perform additional services not addressed in this engagement letter. If this occurs, we will communicate with you regarding the scope of the additional services and the estimated fees. We also may issue a separate engagement letter covering the additional services. In the absence of any other written communication from us documenting such additional services, our services will continue to be governed by the terms of this engagement letter. In the event we are required pursuant to subpoena or other legal process to produce documents or give testimony relating to this engagement in any judicial, administrative or investigative proceedings to which we are not a'party, or, requested to do so, with your consent, in connection with an informal inquiry or investigation, you shall reimburse us at standard billing rates for our professional time and expenses, including reasonable attorney's fees, incurred in responding to such subpoenas or requests. We shall, to the extent legally permissible, notify you as soon as practicable of any such subpoena or request so that you may move to quash, or otherwise oppose the subpoena or request. You agree that our liability to you on account of any damages, liabilities or losses, (including your related costs and expenses), in any way arising out of or relating to the services performed under this agreement shall be limited to the amount of fees paid to us for such services. In no event shall we be liable to you for consequential, special, indirect, incidental, punitive or exemplary damages (including, without limitation, lost profits and opportunity costs) even if we are aware or have been advised of the possibility of such damages. The provisions of this Paragraph shall apply regardless of the form or theory of the action, damage,claim,or liability asserted,whether in contract, statute,tort(including but not limited to negligence) or otherwise. Town of Southold December 12, 2018 Page 5 Engagement Administration, Fees, and Other All disputes arising out of or relating to services provided pursuant to this agreement (regardless of the theory, nature or amount of the claim asserted or the forum in which any action or proceeding is commenced) shall be governed by the laws of the State of New York, including without limitation, its statutes of limitations, without regard to the conflict of law provisions of New York or any other state or jurisdiction. No action, regardless of form, arising out of the services under this agreement may be brought by either of us more than three years after the date of the last services for the year in dispute provided under this agreement. We appreciate the opportunity to be of service to Town of Southold and believe this letter accurately summarizes the significant terms of our engagement. If you have any questions, please let us know. If you agree with the terms of our engagement as described in this letter, please sign the enclosed copy and return it to us. Very truly yours, aUUxM!Q)( VA-�- ' �' 3 a -q ' P. C . <Jd 'C"T Albrecht, Viggiano, Zureck& Company, P.C. RESPONSE: This letter correctly sets forth the understanding of. Town of Southold Name:_ 5�py A a U�S Signature: Title: pt/"l Date: L tfFOtN�\ RECEIVED MAR - 7 2019 �4,- ��� � Southold Town Clerk Office of the Town Attorney Town of Southold - Town Hall Annex, 54375 Route 25 P.O. Box 1179 Southold, New York 11971-0959 Telephone : 631-765-1939 Facsimile: 631-765-6639 MEMORANDUM To: Ms. Elizabeth A. Neville, Town Clerk From: Mary Silleck Secretary to the Town Attorney Date: March 6, 2019 Subject: Engagement letter between Town of Southold and Albrecht, Viggiano, Zureck & Company, P.C. (Deferred Compensation Plan , With respect to the above-referenced matter, I am enclosing the original Agreement together with the Resolution. A If you have any questions regarding the enclosed, please do not hesitate to call me. Thank you. /ms Enclosures cc: Accounting