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HomeMy WebLinkAboutAlbrecht, Viggiano, Zureck & CoSouthold Town Board - Letter Board Meeting of October 21, 2008 RESOLUTION 2008-965 ADOPTED Item fl DOC II): 4336 THIS IS TO CERTIFY TItAT THE FOLLO'WING RESOLUTION NO. 2008-965 WAS ADOPTED AT THE REGULAR MEETING OF TIlE SOUTHOLD TOWN BOARD ON OCTOBER 21, 2008: RESOLVED that the Town Board of the Town of Southold hereby authorizes and directs Supervisor Scott Russell to execute an engagement letter with Albrecht, Vi~,giano, Zureck and Compan¥~ P.C. in connection with the Single Audit of the Town of Southold and for the audit of the Southold Town Justice Court as required by the New York State Office of Court Administration, both audits for the year ended December 31, 2008 and in an total amount not to exceed $70,000 which shall be a legal charge to the General Fund Whole Town Independent Auditing and Accounting Budget (A. 1320.4.500.300), all in accordance with the approval of the Town Attorney. Elizabeth A. Neville Southold Town Clerk RESULT: ADOPTED [UNANIMOUS] MOVER: William Ruland, Councilman SECONDER: Vincent Orlando, Councilman AYES: Ruland, Orlando, Krupski Jr., Wickham, Evans, Russell Generated October 22, 2008 l>agc 30 CERTIFIED PUBLIC ACCOUNTANTS, BUSINESS ADV)$OR$ AND CONSULTANTS 25 Suffolk Court, Haul~lgauge, New York 11788 631.434.9500 · Fax 631.434.9518 ww~avz, com ORIGINAL October 14, 2008 Mr. Scott A. Russell, Town Supervisor Town of Southold Southold, New York 11971 Dear Mr. Russell: COPY We are pleased to confirm our understanding of the services we are to provide Town of Southold for the year ended December 31, 2008. We will audit the financial statements of the governmental activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information, which collectively comprise the basic financial statements, of Town of Southold as of and for the year ended December 31, 2008. Accounting standards generally accepted in the United States provide for certain required supplementary information (RSI), such as managemenrs discussion and analysis (MD&A), to accompany Town of Southold's basic financial statements. As part of our engagement, we will apply certain limited procedures to Town of Southold's RSI. These limited procedures will consist principally of inquiries of management regarding the methods of measurement and presentation, which management is responsible for affirming to us in its representation letter. Unless we encounter problems with the presentation of the RSI or with procedures relating to it, we will disclaim an opinion on it. 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 information If supplementary information other than RSI also accompanies Town of Southold's basic financial statements, we will subject the supplementary information to the auditing procedures applied in our audit of the basic financial statements and will provide an opinion on it in relation to the basic financial statements. Audit Objective The objective of our audit is the expression of opimons as to whether your basic financial statements are fairly presented, in all material respects, in conformity with US generally accepted accounting principles and to report on the fairness of the additional information referred to in the first paragraph when considered in relation to the basic financial statements taken as a whole. Our audit will be conducted in accordance with generally accepted auditing standards established by the Auditing Standards Board (United States) and will include tests of the accounting records and other procedures we consider necessary to enable us to express such opinions. If our opinions on the financial statements 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. ALBRECHT, VIGGIANO, ZURECK ~ COMPANY, P.C. INDEPENDENT ~4EMBER OF BKR INTERNATIONAL Mr. Scott A. Russell, Town Supervisor Town of Southold October 14, 2008 Page 2 Management Responsibilities Management is responsible for the basic financial statements and all accompanying information as well as all representations contained therein. You are also responsible for making all management decisions and performing all management functions; for designating an individual with suitable skill, knowledge, or experience to oversee our financial statement preparation services and any other nonattest 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 internal controls, including monitoring ongoing activities; for the selection and application of accounting principles; and for the fair presentation in the financial statements of the respective financial position of the governmental activities, the business-type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the Town of Southold and the respective changes in financial position and where applicable, cash flows, in conformity with U.S. generally accepted accounting principles. Management is also responsible for making all financial records and related information available to us 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, regulators, or others. In addition, you are responsible for identifying and ensuring that the entity complies with applicable laws and regulations. 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 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 an audit is designed to provide reasonable, but not absolute, assurance and because we will not per[orm a detailed examination of all transactions, there is a risk that material misstatements 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 matedal effect on the financial statements. 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 govemmental regulations that come to our attention, unless cleady 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. Mr. Scott A. Russell, Town Supervisor Town of Southold October 14, 2008 Page 3 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 Control 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. 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 management and those charged with governance internal control related matters that are required to be communicated under AICPA professional standards. Audit Procedures--Compliance As part of obtaining reasonable assurance about whether the financial statements are free of matedal misstatement, we will perform tests of Town of $outhold's compliance with applicable laws and regulations and the provisions of contracts and agreements. However, the objective of our audit will not be to provide an opinion on overall compliance and we will not express such an opinion. Audit Administration, Fees, and Other We understand that your employees will authorize all cash, accounts receivable, or other confirmations we request and will locate any documents selected by us for testing. The audit documentation for this engagement will be retained for a minimum of five years after the report release or for any additional pedod requested by the Town. If we are aware that a federal awarding agency, pass-through entity, or auditee is contesting an audit finding, we will contact the party(les) contesting the audit finding for guidance prior to destroying the audit documentation. We expect to begin our audit on approximately May 15, 2009. Our fee for these services will be at our standard houdy rates plus out-of pocket costs (such as report reproduction, work processing, postage, travel, copies, telephone, etc.). We always attempt to maintain our fees at as reasonable as possible commensurate with our policy of rendering top professional services. The fee for the Audit of the Town of Southold for the year ended December 31, 2008 will be $65,000. We will also audit and issue separate financial statements for the Town of Southold Justice Court Fund for the year ended December 31, 2008. Our audit will be conducted in accordance with accounting principles generally accepted in the United States of Amedca. The financial statements will be prepared on the cash basis of accounting, which is a comprehensive basis of accounting other than accounting principles generally accepted in the United States of America. The audit fee will be $5,000. Mr. Scott A. Russell, Town Supervisor Town of Southold October 14, 2008 Page 4 Our standard hourly rates vary according to the degree of responsibility involved and the experience level of the personnel assigned to your audit. 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 180 days or more 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 dudng 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. 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. Sincerely, Jeffrey S. Davoli, for Albrecht, Viggiano, Zureck & Company, P.C. Enclosure RESPONSE: This letter correctly sets forth the understanding of TOWN OF SOUTHOLD,/~EW YORK Signature: Title: Date: RESOLUTION (ID # 3514) SUBMITTED DOC ID: 3514 THIS IS TO CERTIFY THAT THE FOLLOWING RESOLUTION NO. (ID # 3514) WAS SUBMITTED AT THE REGULAR MEETING OF THE SOUTHOLD TOWN BOARD ON JANUARY 15, 2008: RESOLVED that the Town Board of the Town of Southold hereby authorizes and directs Supervisor Scott Russell to execute an engagement letter with Albrecht~ Viggiano~ Zureck and Company~ P.C. in connection with the Single Audit of the Town of Southold and for the audit of the Southold Town Justice Court as required by the New York State Office of Court Administration, both audits for the year ended December 31, 2007 and in an total amount not to exceed $65,000 which shall be a legal charge to the General Fund Whole Town Independent Auditing and Accounting Budget (A. 1320.4.500.300), all in accordance with the approval of the Town Attorney. Elizabeth A. Neville Southold Town Clerk Januaw 9,2008 C_~RTiFI_ED PUBL~IC ACCOUNTANTS, [~_USII~E~__A_D~/IS.?.R~ AND CO_~NSULTANT5 25,5'~[/blk Court, Hauppauge, New ~;r/~ I1788 631.434.9500 · ["ax 631.434.9518 Mr. John Cushman, Comptroller Town of Southold Town Hall Annex 54375 Main Road Southold, NY 11971 Dear John: Enclosed please the engagement letter for the year ended December 31, 2007. As we discussed, there is no increase in fee. Please have Scott sign and return in the enclosed envelope. I have enclosed a copy for your convenience. If you have any questions on the enclosed, please do not hesitate to call Best Regards, Robe~ S~P~ssner, CPA Enclosure(s) ALBRECHT, VIOGIANO, ZURECK (~ COMPANY, P.C. 25 Suf/blk Court, Hauppauge, New York 11788 631.434.9500 ° Fax 631,434.9518 WWW, OVZ. com December 31, 2007 Mr. Scott A. Russell, Town Supervisor Town of Southold Southold, New York 11971 Dear Mr. Russell: We are pleased to confirm our understanding of the services we are to provide Town of Southold for the year ended December 31, 2007. We will audit the financial statements of the governmental activities, the business-type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information, which collectively comprise the basic financial statements, of Town of Southold as of and for the year ended December 31, 2007. Accounting standards generally accepted in the United States provide for certain required supplementary information (RSl), such as management's discussion and analysis (MD&A), to accompany Town of Southold's basic financial statements. As part of our engagement, we will apply certain limited procedures to Town of Southold's RSl. These limited procedures will consist principally of inquiries of management regarding the methods of measurement and presentation, which management is responsible for affirming to us in its representation letter. Unless we encounter problems with the presentation of the RSl or with procedures relating to it, we will disclaim an opinion on it. 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 information Supplementary information other than RSI, such as combining and individual fund financial statements, also accompanies Town of Southold's basic financial statements. We will subject the following supplementary information to the auditing procedures applied in our audit of the basic financial statements and will provide an opinion on it in relation to the basic financial statements: 1) Schedule of expenditures of federal awards. 2) Summary schedule of prior audit findings. 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 additional information referred to in the first paragraph when considered in relation to the basic financial statements taken as a whole. The objective also includes reporting on-- ALBRECHT, VIGOIANO, ZURECK ~ COMPANY, P.C. Mr. Scott A. Russell, Town Supervisor Town of Southold December 31, 2007 Page 2 · Internal control related to the financial statements and compliance with the provisions of applicable laws, regulations, contracts, agreements, and grants, 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, Draff Part 43 of the New York State Codification of Rules and Regulations (NYCRR), Audits of States, Local Governments, and Non-Profit Organizations. The reports on internal control and compliance will each include a statement that the report is intended for the information and use of the audit committee, management, 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 U.S. generally accepted auditing standards; 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; Draft Part 43 of the New York State Codification of Rules and Regulations (NYCRR); and the provisions of OMB Circular A-133, and will include tests of accounting records, a determination of major program(s) in accordance with Circular A-133, 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 establishing and maintaining interna~ controls, including monitoring ongoing activities; 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, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the Town of Southold and the respective changes in financial position in conformity with U.S. generally accepted accounting principles; and for federal award program compliance with applicable laws and regulations and the provisions of contracts and grant agreements. Management is responsible for the basic financial statements and all accompanying information as well as all representations contained therein. You are responsible for management decisions and functions. As part of the audit, we will prepare a draft of your financial statements, schedule of expenditures of federal awards, and related notes. In accordance with Government Auditing Standards, you will be required to review and approve those financial statements prior to their issuance and have a responsibility to be in a position in fact and appearance to make an informed judgment on those financial statements. Further, you are required to designate a qualified management-level individual to be responsible and accountable for overseeing our services. Mr. Scott A. Russell, Town Supervisor Town of Southold December 31, 2007 Page 3 Management is responsible for making all financial records and related information available to us, including identifying significant vendor relationships in which the vendor has the responsibility for program compliance and for the accuracy and completeness of that information. Management's responsibilities include adjusting the financial statements to correct material misstatements and for 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. Management is responsible for establishment and maintenance of a process for tracking the status of audit findings and recommendations. Management is also responsible for identifying for us previous audits or other engagements or 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 or other engagements 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, and the timing and format related thereto. 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 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. 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. Mr. Scott A. Russell, Town Supervisor Town of Southold December 31, 2007 Page 4 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, 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 also 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, 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 interna~ control issued pursuant to OMB Circular A-133. 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 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 Town of Southold'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 CircularA-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 test of transactions and other applicable procedures described in the OMB Circular A-133 Compliance Supplement for the types of compliance requirements that could have a direct and material effect on each of Town of Southold's major programs. The purpose of those procedures will be to express an opinion on Town of Southold's compliance with requirements applicable to each of its major programs in our report on compliance issued pursuant to OMB Circular A-133. Mr. Scott A. Russell, Town Supervisor Town of Southold December 31, 2007 Page 5 Audit Administration, Fees, and Other We understand that your employees will authorize 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 and sign the Data Collection Form that summarizes our audit findings. We will provide copies of our reports to Town; however, 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 a corrective action plan) along with the Data Collection Form to the designated federal clearinghouse and, if appropriate, 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. At the conclusion of the engagement, we will provide information to management as to where the reporting packages should be submitted and the number to submit. The audit documentation for this engagement is the property of Albrecht, Viggiano, Zureck and Co., P.C. and constitutes confidential information. However, pursuant to authority given by law or regulation, we may be requested to make certain audit documentation available to U.S Department of Housing and Urban Development 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 Albrecht, Viggiano, Zureck and Co., P.C. 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 the Town. If we are aware that a federal awarding agency, pass-through entity, or auditee is contesting an audit finding, we will contact the party(les) contesting the audit finding for guidance prior to destroying the audit documentation. We expect to begin our audit on approximately May 5, 2008. Our fee for these services will be at our standard hourly rates plus out-of pocket costs (such as report reproduction, work processing, postage, travel, copies, telephone, etc.). We always attempt to maintain our fees at as reasonable as possible commensurate with our policy of rendering top professional services. The fee for the Single Audit of the Town of Southold will be $60,000. We will also audit and issue separate financial statements for the Town of Southold Justice Court Fund for the year ended December 31, 2007. Our audit will be conducted in accordance with accounting principles generally accepted in the United States of America. The financial statements will be prepared on the cash basis of accounting, which is a comprehensive basis of accounting other than accounting principles generally accepted in the United States of America. The audit fee will be $5,000. Mr. Scott A. Russell, Town Supervisor Town of Southold December 31, 2007 Page 6 Our standard hourly rates vary according to the degree of responsibility involved and the experience level of the personnel assigned to your audit. 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 180 days or more 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 repod and any letter of comment, and any subsequent peer review reports and letters of comment received during the period of the contract. Our 2005 peer review report accompanies this letter. 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. Sincerely, Jeffrey S. Davoli, for Albrecht, Viggiano, Zureck & Company, P.C. Enclosure RESPONSE: This letter correctly sets forth the understanding of TOWN OF SOUT?~LD, NEW YORK Signature: ' '~'~'" _.JdfL;ccr-/.~~~/ Title: '¢ ~.~ l/i'.~"~' F' Date:/-' / '¢ - Exhibit D November 9, 2005 Pt, LC To the Shareholders of Albrecht, Viggiano, Zureck & Company, P.C. and the Center for Public Company Audit Firms Peer Review Committee We have reviewed the system of quality control for the accounting and auditing practice of Albrecht, Viggiano, Zureck & Company, P.C. (the "firm") applicable to non-SEC issuers in effect for the year ended April 30, 2005. The firm's accounting and auditing practice applicable to SEC issuers was not reviewed by us since the Public Company Accounting Oversight Board ("PCAOB") is responsible for inspecting that portion of the firm's accounting and auditing practice in accordance with PCAOB requirements. A system of quality control encompasses the finn's organizational structure and the policies adopted and procedures established to provide it with reasonable assurance of complying with professional standards. The elements of quality control are described in the Statements on Quality Control Standards issued by the American Institute of Certified Public Accountants (the "AICPA"). The design of the system, and compliance with it, are the responsibilities of the firm. Our responsibility is to express an opinion on the design of the system, and the firm's compliance with that system based on our review. Om' review was conducted in accordance with standards established by the Peer Review Commitlee of the Center for Public Company Audit Firms and included procedures to plan and perform the review that are summarized in the attached description of the peer review process. Our review would not necessarily disclose all weaknesses in the system of quality conu'ol or all instances of lack of compliance with it since it was based on selective tests. Because there are inherent limitations in the effectiveness of any system of quality control, departures from the system may occur and not be detected. Also, projection of any evaluation of a system of quality control to future periods is subject to the risk that the system of quality control may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. In our opinion, the system of quality control for the accounting and auditing practice applicable to the non-SEC issuers of Albrecht, Viggiano, Zureck & Company, P.C. in effect for the year ended April 30, 2005, has been designed to meet the requirements of the quality control standards for an accounting and auditing practice established by the AICPA, and was complied with during the year then ended to provide the firm with reasonable assurance of complying with applicable professional standards. l(raflCPAs PLLC - Codified Public Accountants and Consultants 555 Great Circle Road. Suite 200 o Nashville, TN 37228 · Phone 615-242-73§1 · Fax 615-782-4271 , www.kraffcpas,com Also in Columbia and Lebanon, Tennessee , An independently owned member of the RSM McGladrey Network