CUMBERLAND, RHODE ISLAND FIRE DISTRICT. REQUEST FOR PROPOSALS (RFP) FOR PROFESSIONAL AUDITING SERVICES RFP Issuance Date May 3, 2017

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1 CUMBERLAND, RHODE ISLAND FIRE DISTRICT REQUEST FOR PROPOSALS (RFP) FOR PROFESSIONAL AUDITING SERVICES RFP Issuance Date May 3, 2017 INTRODUCTION The Cumberland Fire District is requesting prpsals frm qualified firms f certified public accuntants t audit its financial statements fr the fiscal year ending 6/30/2017, with the ptin f auditing its financial statements fr each f the 2 subsequent fiscal years. These audits are t be perfrmed in accrdance with generally accepted auditing standards, established by the American Institute f Certified Public Accuntants, and the standards set frth fr financial audits in the Gvernment Auditing Standards issued by the Cmptrller General f the United States. Each year a determinatin shall be made whether the fire district has expended federal awards and the applicability f the prvisins f the federal Single Audit Act f 1984, as amended by the Single Audit Act Amendments f If applicable, these audits are t be perfrmed in accrdance with the prvisins f the federal Single Audit Act f 1984 as amended by the Single Audit Act Amendments f 1996 and U.S. Office f Management and Budget (OMB) Guidance 2 CFR part Unifrm Administrative Requirements, Cst Principles, and Audit Requirements fr Federal Awards - Subpart F Audit Requirements. T be cnsidered, 3 cpies f a prpsal alng with the attached Bid Frm, must be received by Diane Karlyshyn, Finance Directr, 3502 Mendn Rad, Cumberland RI, by: 10:00 AM n 5/30/2017, at which time they will be pened. The Fire District reserves the right t reject any r all prpsals submitted. BACKGROUND INFORMATION The Cumberland Fire Department, (CFD) prvides emergency services t the Twn f Cumberland, Rhde Island. The Department perates ut f fur statins lcated strategically thrughut the twn and prvides services t an apprximate ppulatin f 34,000 residing in an area f 28.6 square miles. The CFD emplys apprximately fifty-tw (52) career persnnel assigned ver fur platns (shifts) in additin t six administrative staff members. All statins are staffed 24 hurs a day, 7 days a week with career persnnel. Currently, the Department hlds and ISO rating f 4. The lcatins f each f the CFD statins include Statin 1, 555 High Street; Statin 2, 1530 Mendn Rad; Statin 4-Headquarters, 3502 Mendn Rad and Statin 5, 50 Arnlds Mills Rad. The central administrative and financial ffices are lcated at the Statin 4 Headquarters. The Cumberland Fire District is gverned by a seven-member Fire Cmmittee elected n a bi-annual basis. The Fire Cmmittee is the actual audit client regarding the District annual audit engagements. The Chairpersn f the Fire Cmmittee and audit client cntact individual representing the Fire Cmmittee is Chairpersn Cynthia Ouellette. Finance Directr Diane Karlyshyn and Fire Chief Kenneth Finlay are als designated as audit client management cntacts during the engagement. The fire district utilizes Visin tax administratin billing and accunts receivable sftware. The district utilizes the QuickBks accunting system fr activity and financial reprting. The finance directr is respnsible fr verseeing tax cllectins and bkkeeping. 1

2 PROCESS OF MERGER OF THE FOUR FORMER CUMBERLAND FIRE DISTRICTS In Nvember f 2010, Cumberland vters apprved a referendum t cnslidate the fur existing fire districts, int ne service. Three ptins f merger were authrized by the referendum including the ptin, which was subsequently enacted, t merge the fur independent fire districts int ne cmbined independent district. With subsequent actin by the Cumberland Twn Cuncil, and with authrizing legislatin apprved by the State in July f 2013, the Cumberland, Cumberland Hill, Nrth Cumberland and Valley Falls independent fire districts became ne independent district, the Cumberland Fire District, in Nvember f The legislatin creating the new cnslidated twn-wide district, passed by Rhde Island General Assembly in July f 2013, specified a single taxatin plicy and the assumptin f assets and persnnel f the fur frmer districts. All functins f the new District, in the same manner as the fur frmer districts, wuld be independent frm the lcal gvernment f the Twn f Cumberland. Starting in Nvember 2014, a seven-member Cumberland Fire Cmmittee was elected. This Cmmittee is elected t tw year terms. Until June 30, 2015, the Fire Cmmittee was managing the budgets f the fur frmer fire districts. Fr the fiscal year starting July 1, 2015, the Fire Cmmittee adpted ne fire district budget and ne fire tax rate. The newly established CFD has cnslidated administrative functins and peratins at its headquarters lcatin. The District is managing the accunting and tax administratin systems f the new Cumberland Fire District as f July 1, PROPOSAL CALENDAR Request fr prpsals issued May 3, 2017 Due date fr prpsals May 30, 2017 EVALUATION OF PROPOSALS An evaluatin cmmittee will evaluate the prpsals using the fllwing scring weights resulting in a maximum scre f 100 pints: Maximum pints Overall qualificatins and experience f the firm and the specific engagement persnnel t be assigned fcusing n experiences with gvernmental entities 40 and the specific line f business r services prvided by the entity t be audited. Overall audit apprach and audit strategy described/utlined in the prpsal and firm capacity t perfrm the engagement within the specified timeframe 30 (prir experience f the firm in meeting timelines shuld be factred in here) Audit fees - See frmula fr pints awarded fr audit fees (*) Maximum evaluatin pints * Evaluatin technique audit fees 2

3 Audit fee scre = (lwest bid/bid fr firm being evaluated) X 30 pints Example: Assuming 3 bids received were: (firm A) - $40,000, (firm B) - $46,000, (firm C) - $50,000 Firm A (the lwest bidder) awarded 30 pints $40,000/$40,000 X 30 pints = 30 Firm B awarded 26 pints $40,000/$46,000 X 30 pints = 26 Firm C awarded 24 pints $40,000/$50,000 X 30 pints = 24 NOTIFICATION AND CONTRACT DATES Ntificatin f Award 6/9/2017 Cntract date-estimated 7/24/2017 DATE AUDIT MAY COMMENCE The Fire District will have recrds and draft financial statements ready fr audit and available by July 24, Hwever, certain recrds may be available as early as July 17 fr transactin testing, review f internal cntrls, and review f public meeting minutes and ther prcesses. DUE DATES FOR COMPLETION OF AUDIT AND DELIVERY OF REPORTS The annual audit shall be cmpleted and final audit reprts (inclusive f all audit cmmunicatins) related t the financial statements shall be delivered t the fire district, the Twn Clerk fr the Twn in which the fire district is lcated, the State Auditr General, and the State Divisin f Municipal Finance by December 31 f each year which is within six mnths after the clse f the fiscal year (as required by Sectin and f the General Laws). The individual r firm selected must agree t a clause in the agreement fr services that prvides a penalty f $ (five hundred dllars) per week r fractin theref fr each such perid the audit reprts and r management letters are late in submissin. N waiver as t the deadline f December 31 will be cnsidered. The additinal audit reprts relating t federal awards (if applicable) and required by the Single Audit Act f 1984, as amended in July 1996, shall be submitted n later than nine mnths after the clse f the fiscal year fr each year. Refer t the applicable OMB Guidance in effect fr the audit perid fr further details n the requirements. QUALIFICATIONS OF AUDITOR 1. The firm selected fr the audit shall be a firm f certified public accuntants hlding a valid license in the State f Rhde Island r frm anther state having equal prfessinal standards. 2. The audit rganizatin and the individuals respnsible fr planning, directing, cnducting substantial prtins f the fieldwrk, r reprting n gvernment audits shall meet the cntinuing educatinal requirements f Gvernment Auditing Standards issued by the Cmptrller General f the United States. 3. The audit rganizatin shall have an apprpriate internal quality cntrl system in place and participate in an external quality cntrl review prgram as required by Gvernment Auditing Standards. 4. The audit rganizatin shall prvide a cpy f their mst recent external quality cntrl review reprt and als submit the results f any subsequent review perfrmed during the term f the cntract t the fire district and the Auditr General. 3

4 AUDIT CONTRACT 1. The audit cntract may cver ne, tw r three fiscal years. Each year must be treated as a separate audit. The cntract perid shall nt exceed three years. 2. Audit cntracts cvering mre than ne year shall specify an audit fee fr each year. The audit fee shall be inclusive f all expenses. 3. Cntinuatin beynd the initial fiscal year f the three-year cntract will be at the discretin f the fire district. 4. Any representatins made with the submissin will be relied upn and if prven t be false will be grunds fr terminatin f the cntract, if awarded. False representatins will als be grunds fr frfeiture f all payments under the cntract. This will nt limit the fire district frm seeking any ther legal r equitable remedies. ADDITIONAL WORK 1. Any amendments t the cntract fr additinal wrk will be negtiated in gd faith. 2. In accrdance with Gvernment Auditing Standards, if the firm prvides nn-audit services, it must evaluate whether prviding the services creates independence impairment with respect t the audit f the fire district. 3. The Finance Directr may request assistance including the preparatin f special reprts, preparatin f budgets, discussin f financing alternatives, as well as cnsultatin f financial and miscellaneus matters and s frth. The Fire District recgnizes that it is nt practical t cmmit t a fixed fee fr thse services and they must be paid fr n an as-rendered basis. Yur prpsal must include yur willingness and ability t render such services, and the methd yu will use fr billing relative t such services, the rates t be charged and the methd t be used fr dcumentatin theref. In accrdance with Gvernment Auditing Standard, the firm prviding nn-audit services must evaluate whether prviding the services creates an independence impairment either in fact r appearance with respect t the audit f the Fire District. AUDIT STANDARDS 1. The audit shall be cnducted in accrdance with generally accepted auditing standards established by the American Institute f Certified Public Accuntants and with the standards fr financial audits cntained in Gvernment Auditing Standards issued by the Cmptrller General f the United States. 2. If a single audit is required, then the standards cntained in the amended (July 1996) Single Audit Act f 1984 and the prvisins f OMB Guidance 2 CFR part Unifrm Administrative Requirements, Cst Principles, and Audit Requirements fr Federal Awards - Subpart F Audit Requirements must als be fllwed. AUDIT SCOPE The financial statements t be presented and reprted upn by the private auditr shall include: Basic financial statements as required by the Gvernmental Accunting Standards Bard; 4

5 Required Supplementary Infrmatin: Management s Discussin and Analysis Schedule f Revenues, Expenditures and Changes in Fund Balance - Budget and Actual Supplementary financial statements, schedules and infrmatin (with auditr s pinin reference that they are fairly stated in all material respects in relatin t the basic financial statements as a whle): Tax Cllectr s Annual Reprt - a statement as t uncllected taxes utstanding at the clse f the last fiscal year accrding t the years fr which the taxes were assessed; Cmbining Fund-level Statements (at the ptin f the fire district) Supplementary Schedule f Expenditures f Federal Awards, if applicable; Majr Federal Prgrams: If applicable, an audit f majr prgrams in accrdance with criteria utlined in OMB Guidance 2 CFR part Unifrm Administrative Requirements, Cst Principles, and Audit Requirements fr Federal Awards - Subpart F Audit Requirements shall be perfrmed and the auditrs shall express an pinin n cmpliance fr each majr prgram, and Other schedules as may be required by the fire district. AUDIT REPORTS Draft cpies f all audit reprt(s) and the management letter shall be submitted t the finance fficer f the fire district by Nvember 30 f the fiscal year being audited s that there will be adequate time fr review. Reprts t be submitted, depending n the scpe f the engagement, may include: a. Reprts n: 1. the fair presentatin f the basic financial statements in accrdance with generally accepted accunting principles based upn an audit perfrmed in accrdance with generally accepted auditing standards and Gvernment Auditing Standards. The auditr shall als make reference t, but nt pine n, required supplementary infrmatin cnsistent with reprting guidance in the applicable AICPA Audit Guide. 2. supplementary financial statements, schedules and infrmatin, are fairly stated in all material respects in relatin t the basic financial statements as a whle. 3. cmpliance and n internal cntrl ver financial reprting based n an audit f financial statements perfrmed in accrdance with Gvernment Auditing Standards. b. Reprts required under trust agreements, lan agreements, etc., if applicable. c. Reprts and summaries related t majr federal financial assistance prgrams as required by OMB Guidance (the auditr shuld refer t applicable OMB guidance in effect and the applicable AICPA Audit Guide fr reprting guidance). d. Other reprts requested by the fire district, as applicable. 5

6 MANAGEMENT LETTER A management letter shall be prvided upn cmpletin f the audit t the finance directr f the fire district, with cpies t the Divisin f Municipal Finance and the Auditr General. The management letter shuld include cmments, and/r recmmendatins beynd thse included in the reprts described abve, n such matters as: plicies, prcedures and practices emplyed by the fire district. cntrl deficiencies that are nt significant deficiencies r material weaknesses. use f resurces t prvide a gvernmental service in a reasnable, judicius, ecnmical, and efficient manner. cmpliance with state laws pertaining t the fire district and with rules and regulatins established by the fire district. ADDITIONAL INFORMATION TO BE PROVIDED TO THE FIRE DISTRICT Prpser technical qualificatins - the prpser shall, at a minimum, describe the fllwing in the prpsal: the current status f the prfessinal license f the firm, partner-in-charge, and senir accuntant in charge f the fieldwrk; staffing infrmatin including: firm size, number f staff allcated t the audit jb, relevant qualificatins and experience f each persn assigned t the audit jb; the amunt and type f prfessinal liability cverage; list f any prfessinal cmplaints pending r reslved against the firm r any f its partners with the state bards f accuntancy, r any self-regulatry, prfessinal r gvernment authrity including but nt limited t the AICPA, r Rhde Island Bard f Accuntancy; infrmatin regarding any lawsuits r claims against the firm, pending r reslved; a statement f relevant experience including a list f gvernmental audits perfrmed in the last five years; expected time budget and cmpletin date fr the audit; Representatins - the fllwing representatins shall be prvided as part f the prpsal: a written representatin that there exist n client cnflicts which wuld inhibit the ability t perfrm the audit in accrdance with prfessinal standards; a written representatin that the private auditr is independent under the requirements f the American Institute f Certified Public Accuntants and Gvernment Auditing Standards; 6

7 a written representatin that the private auditr meets the cntinuing educatinal requirements f Gvernment Auditing Standards; a written representatin that the private auditr has an apprpriate internal quality cntrl system in place and has participated in an external quality cntrl review prgram as required by Gvernment Auditing Standards. The firm will prvide the Fire District and Auditr General with a cpy f its mst recent external quality cntrl review reprt; and a written representatin that the private auditr is familiar with generally accepted accunting principles fr state and lcal gvernment units and with the generally accepted auditing standards prmulgated by the American Institute f Certified Public Accuntants; Gvernment Auditing Standards issued by the Cmptrller General f the United States; the Single Audit Act f 1984 as amended in July 1996; and OMB Guidance 2 CFR part Unifrm Administrative Requirements, Cst Principles, and Audit Requirements fr Federal Awards - Subpart F Audit Requirements. The private auditr will cnduct the audit and reprt in accrdance with thse standards. 7

8 Cumberland Fire District 3502 Mendn Rad Cumberland RI BID FORM Annual Financial Audit Fiscal Year Bid Price June 30, 2017 Bid Price June 30, 2018 Bid Price June 30, 2019 Ttal Vendr Name: Vendr Address: City, State, Zip: Phne # -Fax# Name and Title f Persn Signing: Signature: 8