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HomeMy WebLinkAboutRes 02-49 Appointing Whitley Penn, CPA as the Town Auditor for 2002-2003TOWN OF WESTLAKE RESOLUTION NO. 02-49 A RESOLUTION OF THE BOARD OF ALDERMEN OF THE TOWN OF WESTLAKE, TEXAS, APPOINTING WHITLEY PENN, CPA AS THE TOWN AUDITOR FOR 2002-2003. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE TOWN OF WESTLAKE, TEXAS: SECTION 1: That the Board of Aldermen of the Town of Westlake does hereby appoint Whitley Penn, CPA as the Town auditor for 2002-2003. SECTION 2: That this Resolution shall become effective upon the date of its passage. PASSED AND APPROVED ON THIS 25TH DAY OF NOVEMBER 2002. ATTEST: Scott Bradley, Mayor 16 ("7A -t-,X4 ing Crosswy, To ecretary Trent O. Petty, Town Manager APPROVED AS TO FORM: = WHITLEY PENF CP.AS AND PROFESSIONAL CONSULTANTS November 11, 2002 Mr. Trent Petty Town Manager Town of Westlake, Texas 3 Village Circle Suite 207 Solana Westlake, Texas 76262 Dear Mr. Petty: ReS D Partners Larry G. Autrey, P.C. Felix J. Lozano 111, P.C. David L. Neal, P.C. James C. Penn, P.C. Thomas J. Rein, P.C. Mark A. Topel, P.C. J. Alan White, P.C. B. Glen Whitley, P.C. This letter confirms our understanding of the arrangements for the audit of the general-purpose and combining and individual fund and account group, as applicable financial statements of the Town of Westlake as of September 30, 2002 and for the year ending September 30, 2002 We will audit the Town of Westlake financial statements and comb'm,m,and individual fund and account group financial statements, as applicable as of September '10, 2002, and for the year then ended, for the purpose of evaluating the fairness of presentation of such financial statements in conformity with accounting principles generally accepted in the United States of America and for expressing an opinion on them. It is possible that facts or circumstances encountered during the audit may require us to express an opinion other than unqualified; we will fully discuss the reasons with you in advance should this occur. Our audit will be conducted in accordance with generally accepted auditing standards and Govermnent Auditing Standards, as applicable. Those standards require that we plan and perform the audit to obtain. reasonable, rather than absolute, assurance about whether the financial statements are free of material misstatement, whether caused by error or fraud. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Management is responsible for making all financial records and related information available for purposes of the audit. . Our audit will include such tests of the accounting records and other auditing procedures we consider necessary in the circumstances. Our procedures will include tests of documentary evidence supporting the transactions recorded in the accounts and direct confirmation of receivables and certain other assets and liabilities by correspondence with selected customers, creditors, legal counsel, and banks. Your attorneys may bill you for responding to this inquiry. At the conclusion of our audit, we will request certain written representations from you about the financial statements and related matters. An audit conducted in accordance with generally accepted auditing standards and Govern hent Auditing Standards, as applicable, is subject to certain limitations and the inherent risk that errors, fraud, or illegal acts may exist and not be detected by us. However, we will inform you of any material errors and fraud that come to our attention. We will also inform you of any illegal acts that come to our attention, unless they are clearly inconsequential. Fort Worth: 1701 River Run Road, Suite 507 ° Fort Worth, Texas 761o7 ° (817) 258-9100 - metro (817) 498-0237 -fax (817) 877-3036 Mid -Cities: 86o West Airport Freeway, Suite 6o1 < Hurst, Texas 76054 ° (817) 258-91oo ° metro (817) 498-0237 -fax (817) 656-4013 www.wpcpo.com Mr. Trent Petty, Town Manager November 11, 2002 Town of Westlake Page 2 An audit includes obtaining an understanding of internal control sufficient to plan the audit and to determine the nature, timing, and extent of audit procedures to be performed. An audit is not designed to provide assurance on internal control or to identify reportable conditions, i.e., significant deficiencies in the design or operation of internal control. However, during the audit, if we become aware of such reportable conditions or ways that we believe management practices can be improved, we will communicate them to you in a separate letter. We direct your attention to the fact that management of Town of Westlake has the responsibility for the proper recording of transactions in the books of account, for establishing and maintaining adequate and effective internal control, for the safeguarding of assets, for ensuring compliance with applicable laws and regulations, and for the preparation and substantial accuracy of the financial statements. Although we may advise you about appropriate accounting principles and their application, the selection and method of application are the sole responsibility of the Town of Westlake management. Management is also responsible for identifying and ensuring that the entity complies with applicable laws and regulations applicable to its activities. In addition, management is responsible for adjusting the financial statements for all material adjustments and for confirming to us in the management representation letter that all uncorrected misstatements aggregated by us during the current audit engagement are immaterial, both individually and in the aggregate, to the financial statements taken as a whole. In the event that the financial information provided is incomplete or in inaccurate then we will either complete the work at our standard rate, or delay the audit until this information is complete and accurate. If you intend to publish or otherwise reproduce the financial statements and make reference to our fine, you agree to provide us with printers' proofs or masters for our review and approval before printing. You also agree to provide us with a copy of the final reproduced material for our approval before it is distributed. The timing of our audit will be scheduled for performance and completion as follows: Perfonn year-end audit procedures Issue audit report 11/11/02 12/13/02 Our fees are based on the amount of time required at various levels of responsibility billed at our standard hourly rate, plus actual out-of-pocket expenses. Invoices will be rendered once every month -as work progresses, if necessary and are payable upon presentation in Tarrant County. In accordance with our firm policies, work may be suspended if your account becomes 30 days or more past due and will not resume 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 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 costs through the date of tennination. In addition, invoices not paid in full by the last day of the month will be assessed interest at a rate of 1.5% per month. We estimate that our fee for the audit will be $34,000 to $36,000. We will notify you immediately of any circumstances we encounter that could significantly affect this initial fee estimate. Mr. Trent Petty, Town Manager November 11, 2002 Town of Westlake Page 3 Circumstances encountered during the performance of the audit that warrant additional time or expense could cause us to be unable to complete the engagement within the above estimates. We will endeavor to notify you of any such circumstances as they are assessed. Whitley Penn's maximum liability to the Organization arising for any reason relating to services rendered under this letter shall be limited to three times the amount of fees paid for these services. To the extent our firm is required to post adjusting entries, (e.g., payroll, accounts payable, etc) the Town will be billed at our standard hourly rates. In addition, our fees for audit procedures related to bond issues, lease agreements, or any additional information not previously included in the Town's September 30, 2001 audited financial statements will be billed at our standard hourly rates. To the extent any such items are applicable for the period under audit the Town will be billed at our standard hourly rates. Whenever possible, we will attempt to use your personnel to assist in the preparation of schedules and analyses of accounts. This effort could substantially reduce our time requirements, facilitate the timely conclusion of the audit, and help you hold down audit fees. In the event that the GASB, FASB, or AICPA or GAO issues additional standards or audit procedures that require more than lb hours of additional work during the audit period, we will discuss these requirements with you before proceeding further. Before starting the additional work, we will prepare an estimate of the time necessary, as well as the fee for performing the additional work. Our fee for addressing the additional requirements will be our standard hourly rates for each person involved in the additional work. We agree to retain our workpapers related to this audit for a period of at least three (3) years from the date of our report. We have also attached a copy of our latest external peer review report of our firm for your consideration and files. We are very pleased to participate in this review program as continued evidence of our emphasis on providing Town of Westlake, the highest quality audit. During the course of the audit we may observe opportunities for economy in, or improved controls over, your operations. We will bring such matters to the attention of the appropriate level of management, either orally or in writing. If the foregoing is in accordance with your understanding, please indicate your agreement by signing the duplicate copy of this letter and returning it to us. If you have any questions, please let us know. We appreciate the opportunity to be your certified public accountants and look forward to working with you and your staff. Very truly yours, Enclosures Mr. Trent Petty, Town Manager Town of Westlake RESPONSE: This letter correctly sets forth our understanding. Town of Westlake, Texas Mr. Trent Petty Town Manager '(I &� 4 / - Date November 11, 2002 Page 4