HomeMy WebLinkAboutDeferred Comp Plan AuditRESOLUTION 2015-480
ADOPTED
DOC ID: 10851
THIS IS TO CERTIFY THAT THE FOLLOWING RESOLUTION NO. 2015-480 WAS
ADOPTED AT THE REGULAR MEETING OF THE SOUTHOLD TOWN BOARD ON
MAY 19,2015:
RESOLVED that the Town Board of the Town of Southold hereby authorizes and directs
Supervisor Scott A. Russell to execute the engagement letter between the Town of Southold
and Albrecht, Viggiano, Zureck & Company, P.C. to perform an audit of the Town's
Deferred Compensation Plan for the year ending December 31, 2014, in connection with the
Town's annual reporting obligations under the New York State Deferred Compensation Board,
at a cost not to exceed $12,750., subject to the approval of the Town Attorney, said engagement
to be a legal charge to the 2015 General Fund Whole Town, Independent Auditing and
Accounting appropriation (A. 1320.4.500.300).'
Elizabeth A. Neville
Southold Town Clerk
RESULT: ADOPTED [UNNANIMOUS]
MOVER: Robert Ghosio'Councilman
SECONDER: Louisa P. Evans, Justice
AYES: Ghosio, Dinizio Jr, Ruland; Doherty, Evans, Russell
May 14, 2015
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 for the years ended December 31, 2014 and 2013
in connection with its annual reporting obligation under the New York State Deferred
Compensation Board.
Except as described below, we will audit the statements of net assets available for benefits
of the Town of Southold Deferred Compensation Plan as of December 31, 2014 and 2013
and the related statements of changes in net assets available for benefits for the year
ended December 31, 2014 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).
PERSONAL SERVICE. TRUSTED ADVICE. --^-
ALBRECHT, VIGGIANO, ZURECK & COMPANY, P.C.
245 PARK AVENUE, 39TH FLOOR 25 SUFFOLK COURT
NEW YORK, NY 10167 HAUPPAUGE, NY 11788-3715
T 212.792.4075 7 631.434.9500 'F: 631:434.9518
www.avz.com
,INDEPENDENT MEMBER OF BKR'INTERNATIONAL
Town of Southold
May 14, 2015
Page 2
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 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 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 taken as a whole. 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.
Town of Southold
May 14, 2015
Page 3
Audit Procedures (continued)
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
ERISA plan qualification requirements. 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 ERISA 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 ofand for the year ended
December 31, 2014:
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 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 establishing 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.
Town of Southold
May 14, 2015
Page 4
Management Responsibilities (continued)
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 whore 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.
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.
Town of Southold
May 14, 2015
Page 5
Engagement Administration, Fees, and Other (continued)
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 $12,750 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
May 14, 2015
Page 6
Engagement Administration, Fees, and Other (continued)
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,
OA-eckb rUtt` -'�j¢ CWVV6,Pc.
Albrecht, Viggiano, Zureck & Company, P.C.
RESPONSE:
This letter correctly sets forth the understanding of:
Town of Southold
Name:
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Date