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Heritage Bay Agenda 10/22/2020 Heritage Bay Community Development District Board of Supervisors Edwin Hubbard,Chairman Dennis Gagne,Vice Chairman ❑Justin Faircloth,District Manager F.Jack Arcurie,Assistant Secretary c Gregory Urbancic,District Counsel Donna Hunter,Assistant Secretary ❑Jeffrey Satfield,District Engineer Allen Soucie,Assistant Secretary Audit Committee Meeting Agenda October 22, 2020—9:00 a.m. Meeting URL: https://us02web.zoom.us/j/89497227322 Meeting ID: 894 9722 7322 Call in Number: (929) 205-6099 Password: 414278 1. Roll Call 2. Audit Committee Selection of Auditor A. Review of Audit Firm Proposals B. Ranking of Audit Proposals for FY 2020 3. Audience Comments 4. Adjournment District Office: 210 N.University Drive,Suite 702 Coral Springs,FL 33071 954-603-0033 IJtL11 ? ri PART OF THE USA.TODAY NETWORK Published Daily Naples, FL 34110 HERITAGE BAY COMMUNI TY 210 N UNIVERSITY DR#702 Notice of Audit Committee Meeting CORAL SPRINGS, FL 33071-7320 Heritage Bay Community Development District The Audit Committee of Heritage Bay Community Development District will hold a meeting on Thursday, October 22, 2020 at Affidavit of Publication 9:00 A.M.by means of communications media technology: Meeting URL:https://us02web.zoom.us/j/89497227322 STATE OF WISCONSIN Meeting ID:894 9722 7322 COUNTY OF BROWN Call in number:(929)205-6099 Passcode:414278 Please note that pursuant to Governor DeSantis' Executive Or- Before the undersigned they serve as the authority, der 20-69 (as extended by Executive Orders 20-112, 20-123, 20- 139,20-150, 20-179, 20-193 and 20-246 and as it may be further personally appeared said legal clerk who on oath says that extended or amended) relating to the COVID-19 poublic health he/she serves as Legal Clerk of the Naples Daily News, a emergency and to protect the public and follow the CDC guid- ance regarding social distancing, such public hearing and meet- daily newspaper published at Naples, in Collier County, ing may/are be held telephonically or virtually. While it is neces- Florida; distributed in Collier and Lee counties of Florida; sary to hold the above referenced meeting of the Committee utilizing communications media technology due to the current that the attached copy of the advertising was published in COVID-19 public health emergency, the District fully encourages public participation in a safe and efficient manner. Toward that said newspaper on dates listed. Affiant further says that the end, anyone wishing to listen and participate in the meeting said Naples Daily News is a newspaper published at can do so based upon the number or link above. Additionally, Naples, in said Collier County, Florida, and that the said participants are encouraged to submit questions and comments to the District Manager in advance at justin.fairdoth@inframark newspaper has heretofore been continuously published in .com to facilitate the Committee's consideration of such ques- said tions and comments during a meeting. During this meeting, the Audit Committee will review, discuss, Collier County, Florida; distributed in Collier and Lee evaluate and rank the proposals received in response to the Re- counties of Florida, each day and has been entered as quests for Proposals for Annual Audit Services relating to the class mail matter at the post office in Naples, in audit for the Fiscal Year ended September 30, 2020 and subse- secondp quent years as previously advertised in accordance with Florida said Collier County, Florida, for a period of one year next Law. The meeting is open to the public and will be conducted in accordance with the provisions of Florida Law for Community preceding the first publication of the attached copy of Development Districts. The meeting may be continued to a advertisement; and affiant further says that he has neither date,time, and place to be specified on the record at the meet- ing. A copy of the agenda for this meeting may be obtained paid nor promised any person, or corporation any discount, from the District Manager's office,Inframark, by contacting 954- rebate, commission or refund for the purpose of securing 603-0033 or by email, Justin.Faircloth@lnframark.com. Addi- tionally, interested parties may refer to the District's website for this advertisement for publication in the said newspaper. the latest information: www.heritagebaycdd.com Any person requiring special accommodations at this meeting Published: 1 0/1 412 0 2 0 because of a disability or physical impairment should contact the District Manager's Office at least forty-eight (48)hours prior to the meeting. If you are hearing or speech impaired, please 3 contact the Florida Relay Service by dialing 7-1-1, or 1-800-955- 8771 (TTY) / 1-800-955-8770 (Voice), for aid in contacting the District Manager's Office. Each person who decides to appeal any decision made by the Subscribed and sworn to before on October 14,2020: Board with respect to any matter considered at the meeting is advised that person will need a record of the proceedings and that accordingly, the person may need to ensure that a verba- tim record of the proceedings is made, including the testimony and evidence upon which such appeal is to be based. _...:.,Q.a ct.W1. urn r.4.1.octt, Justin Faircloth District Manager Notary,State of WI,County of Brown October 14,2020 #4413317 TARA MONDLOCI-I Notary Public State of Wisconsin 4 My commission expires August 6,2021 Publication Cost:$399.00 Ad No:0004413317 Customer No: 1305454 PO#: #of Affidavits 1 This is not an invoice 0 O a1 W Off m N O O u0) M O O O O o O O O C O O O O N C) O I...- CO U) CO(O )` ti0, U Ui U) cD CO"(D m O n. �� u a n it ii a n v v vi II ri ri C o N O N N N IO N N N at N N N a7 N N N YO N N N F N N N F N N N i_ N N N i_ IA T C )V 2 a) To TO UT NN0N > OU a COOOC m a ' 2-a) O m , mc E o te oi - m " ° " 2 y ErnuYa c c j a c c _o' •7 U) N a 2O L-O aA J OW 'Rca ` CJ no 3Van d Jaac, C a ' TT O mNm L0 . 0 al C me •C ° ma) a a O a, > y CO TV Na C) o. 0, O 2r 8%C U O CL N O O 7 M O'7 g O a C 0 C T C p- C C C n 1J CN y ,O T- p C J U. f,C0 Qtl Oa, a c O) CpEV O N g N J C ,6 p.0 C UO Vpa, Na 0 C J Co J O O UT E>a) g2m y ,.no ofo m o 2.O a, iE m i1 n o y g o E a m E o d m aE) E , a Q it U N iE rn N 2 O it 2 V, N -0 ca s o c ° c C A as. 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O c m g O LU C 22) ,/ U UCLLOm ' V a OO"O UON VEOr a) C N aNNaC i L a);c a O co O a) , ` COaj La) C L 0 2 O a mwo .- Ca0 NJ NyEO ` CCH D > J 6 C o a) a ; / c a) O 5 o N N ; -2Q CE T LL U W c E �V O u, t aCf — yN, cOCNwC d VadOCaLL Epaa Ua O ° NCO CmEWa Q . LIto m °-2gw ELI > EJ m v omoa• .5c¢ g cc 9"pcpmi5ccoa _ y OyCC,cy aai Jnti am.C'v T . d al ON ` O aoNCpaV O OE To E_ E a p a m` ` m 'UateJ 2 E a, m =m o E ww E ma,U m La) rn�V o0aaa aw2" N c UU Oa> , aO a O C V OaO y 0 0- N a)-p C N a 8ama &E(nN E a' C 2"a a - OEC ;Ca7 U co N O C a, o a c O.0. IA LL a 2 O to' c o a IN o L a ra a � 01 '°U p w E H 10 y j m a) at U >J z F(`J IO E E o 0 c at Q m m E � �LL E. ca Ea ii dp U J Co v E m W ( 1)U Z HERITAGE BAY COMMUNITY DEVELOPMENT DISTRICT PROPOSAL FOR AUDIT SERVICES PROPOSED BY: Berger, Toombs, Elam, Gaines & Frank CERTIFIED PUBLIC ACCOUNTANTS, PL 600 Citrus Avenue, Suite 200 (772) 461-6120 Fort Pierce, Florida 34950 CONTACT PERSON: J. W. Gaines, CPA, Director DATE OF PROPOSAL: October 16, 2020 TABLE OF CONTENTS DESCRIPTION OF SECTION PAGE A. Letter of Transmittal 1-2 B. Profile of the Proposer Description and History of Audit Firm 3 Professional Staff Resources 4-5 Ability to Furnish the Required Services 5 Arbitrage Rebate Services 6 A. Governmental Auditing Experience 7-16 B. Fee Schedule 17 C. Scope of Work to be Performed 17 D. Resumes 18-33 E. Peer Review Letter 34 F. Additional Documents Required Instructions to Proposers 35-36 c� rrr Berger, Toombs, Elam, Gaines & Frank Certified Public Accountants PL 600 Citrus Avenue Suite 200 Fort Pierce,Florida 34950 772/461-6120//461-1155 FAX: 772/468-9278 October 16, 2020 Heritage Bay Community Development District Inframark Infrastructure Management Services 15275 Collier Blvd, #201-346 Naples, FL 34119 Dear District Manager: Thank you very much for the opportunity to present our professional credentials to provide audit services for Heritage Bay Community Development District. Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL has assembled a team of governmental and nonprofit specialists second to none to serve our clients. Our firm has the necessary qualifications and experience to serve as the independent auditors for Heritage Bay Community Development District. We will provide you with top quality, responsive service. Experience Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL is a recognized leader in providing services to governmental and nonprofit agencies throughout Florida. We have been the independent auditors for a number of local governmental agencies and through our experience in performing their audits, we have been able to increase our audit efficiency and; therefore, reduce costs. We have continually passed this cost savings on to our clients and will continue to do so in the future. As a result of our experience and expertise, we have developed an effective and efficient audit approach designed to meet or exceed the performance specifications in accordance with auditing standards generally accepted in the United States of America, the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States, and the standards for financial and compliance audits. We will conduct the audit in accordance with auditing standards generally accepted in the United States of America; "Government Auditing Standards" issued by the Comptroller General of the United States; the provisions of the Single Audit Act, Subpart F of Title 2 US Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, with minimal disruption to your operations. Our firm has frequent technical updates to keep our personnel informed and up-to-date on all changes that are occurring within the industry. Fort Pierce/Stuart Member AICPA Member AICPA Division for CPA Firms Member FICPA Private Companies practice Section cec Berger,Toombs, Elam, -} Gaines& Frank Csnifed Public ACWunhnh PL Heritage Bay Community Development District October 16, 2020 Our firm is a member of the Government Audit Quality Center, an organization dedicated to improving government audit quality. We also utilize the audit program software of a nationally recognized CPA firm to assure us that we are up to date with all auditing standards and to assist us maintain maximum audit efficiencies. To facilitate your evaluation of our qualifications and experience, we have arranged this proposal to include a resume of our firm, including our available staff, our extensive prior governmental and nonprofit auditing experience and clients to be contacted. You need a firm that will provide an efficient, cost-effective, high-quality audit within critical time constraints. You need a firm with the prerequisite governmental and nonprofit experience to perform your audit according to stringent legal and regulatory requirements, a firm that understands the complex nature of community development districts and their unique compliance requirements. You need a firm with recognized governmental and nonprofit specialists within the finance and governmental communities. And, certainly, you need a firm that will provide you with valuable feedback to enhance your current and future operations. Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL is that firm. J. W. Gaines is the person authorized to make representations for the firm. Thank you again for the opportunity to submit this proposal to Heritage Bay Community Development District. Very truly yours, aattt. Jonk )Otti)rilia) 4.14- Berger, Toombs, Elam, Gaines & Frank Certified Public Accountants PL Fort Pierce, Florida - 2 - PROFILE OF THE PROPOSER Description and History of Audit Firm Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL is a Treasure Coast public accounting firm, which qualifies as a small business firm, as established by the Small Business Administration (13 CFR 121.38), with offices in Fort Pierce and Stuart. We are a member of the Florida Institute of Certified Public Accountants and the American Institute of Certified Public Accountants. The firm was formed from the merger of Edwards, Berger, Harris & Company (originated in 1972) and McAlpin, Curtis & Associates (originated in 1949). J. W. Gaines and Associates (originated in 1979) merged with the firm in 2004. Our tremendous growth rate experienced over the last 71 years is directly attributable to the firm's unrelenting dedication to providing the highest quality, responsive professional services attainable to its clients. We are a member of the Private Companies Practice Section (PCPS) of the American Institute of Certified Public Accountants (AICPA) to assure we meet the highest standards. Membership in this practice section requires that our firm meet more stringent standards than standard AICPA membership. These rigorous requirements include the requirement of a triennial peer review of our firm's auditing and accounting practice and annual Continuing Professional Education (CPE) for all accounting staff (whether CPA or non-CPA). For standard AICPA membership, only a quality review is required and only CPAs must meet CPE requirements. We are also a member of the Government Audit Quality Center ("the Center") of the American Institute of Certified Public Accountants to assure the quality of our government audits. Membership in the Center, which is voluntary, requires our firm to comply with additional standards to promote the quality of government audits. We have been extensively involved in serving local government entities with professional accounting, auditing and consulting services throughout the entire 71 year history of our firm. Our substantial experience over the years makes us uniquely qualified to provide accounting, auditing, and consulting services to these clients. We are a recognized leader in providing services to governmental and nonprofit agencies on the Treasure Coast and in Central and South Florida, with extensive experience in auditing community development districts and water control districts. We were the independent auditors of the City of Fort Pierce for over 37 years and currently, we are the independent auditors for St. Lucie County since 2002, and for 38 of the 42 years that the county has been audited by CPA firms. Additionally, we have performed audits of the City of Stuart, the City of Vero Beach, Indian River County and Martin County. We also presently audit over 75 Community Development Districts throughout Florida. Our firm was founded on the belief that we are better able to respond to our clients needs through education, experience, independence, quality control, and personal service. Our firm's commitment to quality is reflected in our endeavor of professional excellence via continuing education, the use of the latest computer technology, professional membership in PCPS and peer review. We believe our approach to audit engagements, intelligence and innovation teamed with sound professional judgment enables us to explore new concepts while remaining sensitive to the fundamental need for practical solutions. We take pride in giving you the assurance that the personal assistance you receive comes from years of advanced training, technical experience and financial acumen. - 3 - Professional Staff Resources Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL has a total of 32 professional and administrative staff (including 14 professional staff with extensive experience servicing government entities). The work will be performed out of our Fort Pierce office with a proposed staff of one senior accountant and one or two staff accountants supervised by an audit manager and audit partner. With the exception of the directors of the firm's offices, the professional staff is not specifically assigned to any of our individual offices. The professional and administrative staff resources available to you through Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL are as follows: Total Partners/Directors (CPA's) 5 Principals (CPA) 1 Managers (CPA) 1 Senior/Supervisor Accountants (2 CPA's) 3 Staff Accountants (1 CPA) 9 Computer Specialist 1 Paraprofessional 8 Administrative 4 Total— all personnel 32 Following is a brief description of each employee classification: Staff Accountant — Staff accountants work directly under the constant supervision of the auditor-in-charge and, are responsible for the various testing of documents, account analysis and any other duties as his/her supervisor believes appropriate. Minimum qualification for a staff accountant is graduation from an accredited university or college with a degree in accounting or equivalent. Senior Accountant — A senior accountant must possess all the qualifications of the staff accountant, in addition to being able to draft the necessary reports and financial statements, and supervise other staff accountants when necessary. Managers — A manager must possess the qualifications of the senior accountant, plus be able to work without extensive supervision from the auditor-in-charge. The manager should be able to draft audit reports from start to finish and to supervise the audit team, if necessary. Principal —A principal is a partner/director in training. He has been a manager for several years and possesses the technical skills to act as the auditor—in-charge. A principal has no financial interest in the firm. Partner/Director — The director has extensive governmental auditing experience and acts as the auditor-in-charge. Directors have a financial interest in the firm. - 4- Professional Staff Resources (Continued) Independence — Independence of the public accounting firm, with respect to the audit client, is the foundation from which the public gains its trust in the opinion issued by the public accounting firm at the end of the audit process. This independence must be in appearance as well as in fact. The public must perceive that the accounting firm is independent of the audit entity to ensure that nothing would compromise the opinion issued by the public accounting firm. Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL is independent of Heritage Bay Community Development District, including its elected officials and related parties, at the date of this proposal, as defined by the following rules, regulations, and standards: AuSection 220 — Statements on Auditing Standards issued by the American Institute of Certified Public Accountants; ET Sections 101 and 102 — Code of Professional Conduct of the American Institute of Certified Public Accountants; Chapter 21A-1, Florida Administrative Code; Section 473.315, Florida Statutes; and, Government Auditing Standards, issued by the Comptroller General of the United States. On an annual basis, all members of the firm are required to confirm, in writing, that they have no personal or financial relationships or holding that would impair their independence with regard to the firm's clients. Independence is a hallmark of our profession. We encourage our staff to use professional judgment in situations where our independence could be impaired or the perception of a conflict of interest might exist. In the governmental sector, public perception is as important as professional standards. Therefore, the utmost care must be exercised by independent auditors in the performance of their duties. Ability to Furnish the Required Services As previously noted in the Profile of the Proposer section of this document, our firm has been in existence for over 69 years. We have provided audit services to some clients for over 30 years continually. Our firm is insured against physical loss through commercial insurance and we also carry liability insurance. The majority of our audit documentation is stored electronically, both on our office network and on each employee laptop or computer assigned to each specific job. Our office computer network is backed up on tape, so in the event of a total equipment loss, we can restore all data as soon as replacement equipment is acquired. In addition, our field laptop computers carry the same data and can be used in the event of emergency with virtually no delay in completing the required services. - 5- ADDITIONAL SERVICES PROVIDED Arbitrage Rebate Services Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL also provides arbitrage rebate compliance and related services to governmental issuers. The Tax Reform Act of 1986 requires issuers of most tax-exempt obligations to pay (i.e., "rebate") to the United States government any arbitrage profits. Arbitrage profits are earnings on the investment of bond proceeds and certain other monies in excess of what would have been earned had such monies been invested at a yield equal to the yield on the bonds. Federal tax law requires that interim rebate calculations and payments are due at the end of every fifth bond year. Final payment is required upon redemption of the bonds. More frequent calculations may be deemed advisable by an issuer's auditor, trustee or bond counsel or to assure that accurate and current records are available. These more frequent requirements are usually contained in the Arbitrage or Rebate Certificate with respect to the bonds. Our firm performs a comprehensive rebate analysis and includes the following: • Verifying that the issue is subject to rebate; • Calculating the bond yield; • Identifying, and separately accounting for, all "Gross Proceeds" (as that term is defined in the Code) of the bond issue, including those requiring analysis due to "transferred proceeds" and/or"commingled funds" circumstances; • Determining what general and/or elective options are available to Gross proceeds of the issue; • Calculating the issue's excess investment earning (rebate liability), if any; • Delivering appropriate documentation to support all calculations; • Providing an executive summary identifying the methodology employed, major assumptions, conclusions, and any other recommendations for changes in recordkeeping and investment policies; • Assisting as necessary in the event of an Internal Revenue Service inquiry; and, • Consulting with issue staff, as necessary, regarding arbitrage related matters. - 6- GOVERNMENTAL AUDITING EXPERIENCE Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL has been practicing public accounting in Florida for 69 years. Our success over the years has been the result of a strong commitment to providing personalized quality service to our clients. The current members of our firm have performed audits of over 900 community development districts, and over 1,800 audits of municipalities, counties and other governmental entities such as the City of Fort Pierce and St. Lucie County. Our firm provides a variety of accounting, auditing, tax litigation support, and consulting services. Some of the professional accounting, auditing and management consulting services that are provided by our firm are listed below: • Performance of annual financial and compliance audits, including Single Audits of state and federal financial assistance programs, under the provisions of the Single Audit Act, Subpart F of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), with minimal disruptions to your operations; • Performance of special compliance audits to ascertain compliance with the applicable local, state and federal laws and regulations; • Issuance of comfort letters and consent letters in conjunction with the issuance of tax- exempt debt obligations, including compiling financial data and interim period financial statement reviews; • Calculation of estimated and actual federal arbitrage rebates; • Assistance in compiling historical financial data for first-time and supplemental submissions for GFOA Certificate of Achievement for Excellence in Financial Reporting; • Preparation of indirect cost allocation systems in accordance with Federal and State regulatory requirements; • Providing human resource and employee benefit consulting; • Performance of automation feasibility studies and disaster recovery plans; • Performance feasibility studies concerning major fixed asset acquisitions and utility plant expansion plans (including electric, water, pollution control, and sanitation utilities); and • Assistance in litigation, including testimony in civil and criminal court. • Assist clients who utilize QuickBooks software with their software needs. Our Certified QuickBooks Advisor has undergone extensive training through QuickBooks and has passed several exams to attain this Certification. Continuing Professional Education All members of the governmental audit staff of our firm, and audit team members assigned to this engagement, are in compliance with the Continuing Professional Education (CPE) requirements set forth in Government Auditing Standards issued by the Comptroller General of the United States. In addition, our firm is in compliance with the applicable provisions of the Florida Statutes that require CPA's to have met certain CPE requirements prior to proposing on governmental audit engagements. - 7 - GOVERNMENTAL AUDITING EXPERIENCE (CONTINUED) The audit team has extensive experience in performing governmental audits and is exposed to intensive and continuing concentration on these types of audits. Due to the total number of governmental audits our team performs, each member of our governmental staff must understand and be able to perform several types of governmental audits. It is our objective to provide each professional employee fifty hours or more of comprehensive continuing professional education each year. This is accomplished through attending seminars throughout Florida and is reinforced through in-house training. Our firm has made a steadfast commitment to professional education. Our active attendance and participation in continuing professional education is a major part of our objective to obtain the most recent knowledge on issues which are of importance to our clients. We are growing on the reputation for work that our firm is providing today. Quality Control Program Quality control requires continuing commitment to professional excellence. Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL is formally dedicated to that commitment. To ensure maintaining the standards of working excellence required by our firm, we joined the Private Companies Practice Section (PCPS) of the American Institute of Certified Public Accountants (AICPA). To be a participating member firm of this practice section, a firm must obtain an independent Peer Review of its quality control policies and procedures to ascertain the firm's compliance with existing auditing standards on the applicable engagements. The scope of the Peer Review is comprehensive in that it specifically reviews the following quality control policies and procedures of the participating firm: • Professional, economic, and administrative independence; • Assignment of professional personnel to engagements; • Consultation on technical matters; • Supervision of engagement personnel; • Hiring and employment of personnel; • Professional development; • Advancement; • Acceptance and continuation of clients; and, • Inspection and review system. We believe that our commitment to the program is rewarding not only to our firm, but primarily to our clients. The external independent Peer Review of the elements of our quality control policies and procedures performed by an independent certified public accountant, approved by the PCPS of the AICPA, provides you with the assurance that we continue to conform to standards of the profession in the conduct of our accounting and auditing practice. - 8 - GOVERNMENTAL AUDITING EXPERIENCE (CONTINUED) Our firm is also a member of Governmental Audit Quality Center (GAQC), a voluntary membership center for CPA firms that perform governmental audits. This center promotes the quality of governmental audits. Our firm has completed successive Peer Reviews. These reviews included a representative sample of our firm's local governmental auditing engagements. As a result of these reviews, our firm obtained an unqualified opinion on our quality control program and work procedures. On page 31 is a copy of our most recent Peer Review report. It should be noted that we received a pass rating. Our firm has never had any disciplinary actions by state regulatory bodies or professional organizations. As our firm performs approximately one hundred fifty audits each year that are reviewed by federal, state or local entities, we are constantly dealing with questions from these entities about our audits. We are pleased to say that any questions that have been raised were minor issues and were easily resolved without re-issuing any reports. Certificate of Achievement for Excellence in Financial Reporting (CAFR) We are proud and honored to have been involved with the City of Fort Pierce and the Fort Pierce Utilities Authority when they received their first Certificates of Achievement for Excellence in Financial Reporting for the fiscal years ended September 30, 1988 and 1994, respectively. We were also instrumental in the City of Stuart receiving the award, in our first year of performing their audit, for the year ended September 30, 1999. We also assisted St. Lucie County, Florida for the year ended September 30, 2003, in preparing their first Comprehensive Annual Financial Report, and St. Lucie County has received their Certificate of Achievement for Excellence in Financial Reporting every year since. As continued commitment to insuring that we are providing the highest level of experience, we have had at least one employee of our firm serve on the GFOA — Special Review Committee since the mid-1980s. This committee is made up of selective Certified Public Accountants throughout the United States who have demonstrated their high level of knowledge and expertise in governmental accounting. Each committee member attends a special review meeting at the Annual GFOA Conference. At this meeting, the committee reports on the Certificate of Achievement Program's most recent results, future goals, and common reporting deficiencies. We feel that our previous experience in assisting the City of Fort Pierce, the Fort Pierce Utilities Authority and St. Lucie County obtain their first CAFRs, and the City of Stuart in continuing to receive a CAFR and our firm's continued involvement with the GFOA, and the CAFR review committee make us a valued asset for any client in the field of governmental financial reporting. - 9- GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) References Terracina Community Development Gateway Community Development District District Jeff Walker, Special District Services Stephen Bloom, Severn Trent Management (561) 630-4922 (954) 753-5841 The Reserve Community Development District Port of the Islands Community Development District Darrin Mossing, Governmental Management Cal Teague, Premier District Management Services LLC (407) 841-5524 (239) 690-7100 ext 101 In addition to the above, we have the following additional governmental audit experience: Community Development Districts Aberdeen Community Development Beacon Lakes Community District Development District Alta Lakes Community Development Beaumont Community Development District District Amelia Concourse Community Bella Collina Community Development Development District District Amelia Walk Communnity Bonnet Creek Community Development District Development District Aqua One Community Development Buckeye Park Community District Development District Arborwood Community Development Candler Hills East Community District Development District Arlington Ridge Community Cedar Hammock Community Development District Development District Bartram Springs Community Central Lake Community Development District Development District Baytree Community Development Channing Park Community District Development District - 10 - GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) Cheval West Community Evergreen Community Development Development District District Coconut Cay Community Forest Brooke Community Development District Development District Colonial Country Club Community Gateway Services Community Development District Development District Connerton West Community Gramercy Farms Community Development District Development District Copperstone Community Greenway Improvement District Development District Creekside @ Twin Creeks Community Greyhawk Landing Community Development District Development District Deer Run Community Development Griffin Lakes Community Development District District Dowden West Community Habitat Community Development Development District District DP1 Community Development Harbor Bay Community Development District District Eagle Point Community Development Harbourage at Braden River District Community Development District East Nassau Stewardship District Harmony Community Development District Eastlake Oaks Community Development District Harmony West Community Development District Easton Park Community Development District Harrison Ranch Community Development District Estancia @ Wiregrass Community Development District Hawkstone Community Development District - 11 - GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) Heritage Harbor Community Madeira Community Development Development District District Heritage Isles Community Marhsall Creek Community Development District Development District Heritage Lake Park Community Meadow Pointe IV Community Development District Development District Heritage Landing Community Meadow View at Twin Creek Development District Community Development District Heritage Palms Community Mediterra North Community Development District Development District Heron Isles Community Midtown Miami Community Development District Development District Heron Isles Community Development Mira Lago West Community District Development District Highland Meadows II Community Montecito Community Development District Development District Julington Creek Community Narcoossee Community Development District Development District Laguna Lakes Community Naturewalk Community Development District Development District Lake Bernadette Community New Port Tampa Bay Community Development District Development District Lakeside Plantation Community Overoaks Community Development Development District District Landings at Miami Community Panther Trace II Community Development District Development District Legends Bay Community Paseo Community Development Development District District Lexington Oaks Community Pine Ridge Plantation Community Development District Development District Live Oak No. 2 Community Piney Z Community Development Development District District - 12 - GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) Poinciana Community Sampson Creek Community Development District Development District Poinciana West Community San Simeon Community Development District Development District Port of the Islands Community Six Mile Creek Community Development District Development District Portofino Isles Community South Village Community Development District Development District Quarry Community Development Southern Hills Plantation I District Community Development District Renaissance Commons Community Southern Hills Plantation III Development District Community Development District Reserve Community South Fork Community Development District Development District Reserve#2 Community St. John's Forest Community Development District Development District River Glen Community Stoneybrook South Community Development District Development District River Hall Community Stoneybrook South at ChampionsGate Development District Community Development District River Place on the St. Lucie Stoneybrook West Community Community Development District Development District Rivers Edge Community Tern Bay Community Development District Development District Riverwood Community Terracina Community Development Development District District Riverwood Estates Community Tison's Landing Community Development District Development District Rolling Hills Community TPOST Community Development Development District District Rolling Oaks Community Development District - 13 - GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) Triple Creek Community Vizcaya in Kendall Development District Development District TSR Community Development Waterset North Community District Development District Turnbull Creek Community Westside Community Development Development District District Twin Creeks North Community WildBlue Community Development Development District District Urban Orlando Community Willow Creek Community Development District Development District Verano#2 Community Willow Hammock Community Development District Development District Viera East Community Winston Trails Community Development District Development District VillaMar Community Zephyr Ridge Community Development District Development District - 14- GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) Other Governmental Organizations City of Westlake Office of the Medical Examiner, District 19 Florida Inland Navigation District Rupert J. Smith Law Library of St. Lucie County Fort Pierce Farms Water Control District St. Lucie Education Foundation Indian River Regional Crime Seminole Improvement District Laboratory, District 19, Florida Troup Indiantown Water Viera Stewardship District Control District Current or Recent Single Audits, St. Lucie County, Florida Gateway Services Community Development Early Learning Coalition, Inc. District Treasure Coast Food Bank, Inc. Members of our audit team have acquired extensive experience from performing or participating in over 2,100 audits of governments, independent special taxing districts, school boards, and other agencies that receive public money and utilize fund accounting. Much of our firm's auditing experience is with compliance auditing, which is required for publicly financed agencies. In this type of audit, we do a financial examination and also confirm compliance with various statutory and regulatory guidelines. Following is a summary of our other experience, including Auditor General experience, as it pertains to other governmental and fund accounting audits. Counties (Includes elected constitutional officers, utilities and dependent taxing districts) Indian River Martin Okeechobee Palm Beach Municipalities City of Port St. Lucie City of Vero Beach Town of Orchid - 15- GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) Special Districts Bannon Lakes Community Development District Boggy Creek Community Development District Capron Trail Community Development District Celebration Pointe Community Development District Coquina Water Control District Diamond Hill Community Development District Dovera Community Development District Durbin Crossing Community Development District Golden Lakes Community Development District Lakewood Ranch Community Development District Martin Soil and Water Conservation District Meadow Pointe III Community Development District Myrtle Creek Community Development District St. Lucie County— Fort Pierce Fire District The Crossings at Fleming Island St. Lucie West Services District Indian River County Mosquito Control District St. John's Water Control District Westchase and Westchase East Community Development Districts Pier Park Community Development District Verandahs Community Development District Magnolia Park Community Development District Schools and Colleges Federal Student Aid Programs— Indian River Community College Indian River Community College Okeechobee County District School Board St. Lucie County District School Board State and County Agencies Central Florida Foreign-Trade Zone, Inc. (a nonprofit organization affiliated with the St. Lucie County Board of County Commissioners) Florida School for Boys at Okeechobee Indian River Community College Crime Laboratory Indian River Correctional Institution - 16 - FEE SCHEDULE We propose the fee for our audit services described below to be $5,095 for the years ended September 30, 2020, 2021, and 2022. The fee is contingent upon the financial records and accounting systems of Heritage Bay Community Development District being "audit ready" and the financial activity for the District is not materially increased. If we discover that additional preparation work or subsidiary schedules are needed, we will consult with your authorized representative. We can assist with this additional work at our standard rates should you desire. SCOPE OF WORK TO BE PERFORMED If selected as the District's auditors, we will perform a financial and compliance audit in accordance with Section 11.45, Florida Statutes, in order to express an opinion on an annual basis on the financial statements of Heritage Bay Community Development District as of September 30, 2020, 2021, and 2022. The audits will be performed to the extent necessary to express an opinion on the fairness in all material respects with which the financial statements present the financial position, results of operations and changes in financial position in conformity with generally accepted accounting principles and to determine whether, for selected transactions, operations are properly conducted in accordance with legal and regulatory requirements. Reportable conditions that are also material weaknesses shall be identified as such in the Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters. Other (non-reportable) conditions discovered during the course of the audit will be reported in a separate letter to management, which will be referred to in the Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters. Our audit will be performed in accordance with standards for financial and compliance audits contained in Government Auditing Standards, as well as in compliance with rules and regulations of audits of special districts as set forth by the State Auditor General in Chapter 10.550, Local Governmental Entity Audits, and other relevant federal, state and county orders, statutes, ordinances, charter, resolutions, bond covenants, Administrative Code and procedures, or rules and regulations which may pertain to the work required in the engagement. The primary purpose of our audit will be to express an opinion on the financial statements discussed above. It should be noted that such audits are subject to the inherent risk that errors or irregularities may not be detected. However, if conditions are discovered which lead to the belief that material errors, defalcations or other irregularities may exist or if other circumstances are encountered that require extended services, we will promptly notify the appropriate individual. - 17 - Commitment to Quality Service Personnel Qualifications and Experience J. W. Gaines, CPA, CITP Director—41 years Education • Stetson University, B.B.A. —Accounting Registrations • Certified Public Accountant—State of Florida, State Board of Accountancy • Certified Information Technology Professional (CITP) —American Institute of Certified Public Accountants Professional Affiliations/Community Service • Member of the American and Florida Institutes of Certified Public Accountants • Affiliate member Government Finance Officers Association • Past President, Vice President-Campaign Chairman, Vice President and Board Member of United Way of St. Lucie County, 1989 - 1994 • Past President, President Elect, Secretary and Treasurer of the Treasure Coast Chapter of the Florida Institute of Certified Public Accountants, 1988 - 1991 • Past President of Ft. Pierce Kiwanis Club, 1994 - 95, Member/Board Member since 1982 • Past President, Vice President and Treasurer of St. Lucie County Chapter of the American Cancer Society, 1980 -1986 • Member of the St. Lucie County Chamber of Commerce, Member Board of Directors, Treasurer, September 2002 - 2006, Chairman Elect 2007, Chairman 2008, Past Chairman 2009 • Member Lawnwood Regional Medical Center Board of Trustees, 2000 — Present, Chairman 2013 - Present • Member of St. Lucie County Citizens Budget Committee, 2001 —2002 • Member of Ft. Pierce Citizens Budget Advisory Committee, 2010—2011 • Member of Ft. Pierce Civil Service Appeals Board, 2013 - Present Professional Experience • Miles Grant Development/Country Club— Stuart, Florida, July 1975—October 1976 • State Auditor General's Office — Public Accounts Auditor — November 1976 through September 1979 • Director - Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants PL, responsible for numerous government and nonprofit audits. • Over 30 years experience in all phases of public accounting and auditing experience, with a concentration in financial and compliance audits. Mr. Gaines has been involved in all phases of the audits listed on the preceding pages. - 18 - Commitment to Quality Service Personnel Qualifications and Experience J. W. Gaines, CPA, CITP (Continued) Director Continuing Professional Education • Has participated in numerous continuing professional education courses provided by nationally recognized sponsors over the last two years to keep abreast of the latest developments in accounting and auditing such as: Governmental Accounting Report and Audit Update Analytical Procedures, FICPA Annual Update for Accountants and Auditors Single Audit Sampling and Other Considerations - 19 - Commitment to Quality Service Personnel Qualifications and Experience David S. McGuire, CPA, CITP Accounting and Audit Principal— 12 years Accounting and Audit Manager—4 years Staff Accountant — 11 years Education • University of Central Florida, B.A. —Accounting • Barry University— Master of Professional Accountancy Registrations • Certified Public Accountant—State of Florida, State Board of Accountancy • Certified Information Technology Professional (CITP) —American Institute of Certified Public Accountants • Certified Not-For-Profit Core Concepts 2018 Professional Affiliations/Community Service • Member of the American and Florida Institutes of Certified Public Accountants • Associate Member, Florida Government Finance Office Associates • Assistant Coach —St. Lucie County Youth Football Organization (1994—2005) • Assistant Coach —Greater Port St. Lucie Football League, Inc. (2006 —2010) • Board Member—Greater Port St. Lucie Football League, Inc. (2011 — present) • Treasurer, AIDS Research and Treatment Center of the Treasure Coast, Inc. (2000 — 2003) • Board Member/Treasurer, North Treasure Coast Chapter, American Red Cross (2004—2010) • Member/Board Member of Port St. Lucie Kiwanis (1994—2001) • President (2014/15) of Sunrise Kiwanis of Fort Pierce (2004—present) • St. Lucie District School Board Superintendent Search Committee (2013— present) Professional Experience • Twenty-four years public accounting experience with an emphasis on nonprofit and governmental organizations. • Audit Manager in-charge on a variety of audit and review engagements within several industries, including the following government and nonprofit organizations: St. Lucie County, Florida 19th Circuit Office of Medical Examiner Troup Indiantown Water Control District Exchange Club Center for the Prevention of Child Abuse, Inc. Healthy Kids of St. Lucie County Mustard Seed Ministries of Ft. Pierce, Inc. Reaching Our Community Kids, Inc. Reaching Our Community Kids - South St. Lucie County Education Foundation, Inc. Treasure Coast Food Bank, Inc. North Springs Improvement District • Four years of service in the United States Air Force in computer operations, with a top secret (SCl/SBI) security clearance. - 20 - Commitment to Quality Service Personnel Qualifications and Experience David S. McGuire, CPA, CITP (Continued) Accounting and Audit Principal Continuing Professional Education ♦ Mr. McGuire has attended numerous continuing professional education courses and seminars taught by nationally recognized sponsors in the accounting auditing and single audit compliance areas. He has attended courses over the last two years in those areas as follows: Not-for-Profit Auditing Financial Results and Compliance Requirements Update: Government Accounting Reporting and Auditing Annual Update for Accountants and Auditors - 21 - Commitment to Quality Service Personnel Qualifications and Experience David F. Haughton, CPA Accounting and Audit Manager— 30 years Education • Stetson University, B.B.A. —Accounting Registrations • Certified Public Accountant—State of Florida, State Board of Accountancy Professional Affiliations/Community Service • Member of the American and Florida Institutes of Certified Public Accountants • Former Member of Florida Institute of Certified Public Accountants Committee on State and Local Government • Affiliate Member Government Finance Officers Association (GFOA) for over 10 years • Affiliate Member Florida Government Finance Officers Association (FGFOA) for over 10 years • Technical Review— 1997 FICPA Course on State and Local Governments in Florida • Board of Directors — Kiwanis of Ft. Pierce, Treasurer — 1994-1999; Vice President — 1999- 2001 Professional Experience • Twenty-seven years public accounting experience with an emphasis on governmental and nonprofit organizations. • State Auditor General's Office — West Palm Beach, Staff Auditor, June 1985 to September 1985 • Accounting and Audit Manager of Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants PL, responsible for audit and accounting services including governmental and not-for-profit audits. • Over 20 years of public accounting and governmental experience, specializing in governmental and nonprofit organizations with concentration in special districts, including Community Development Districts which provide services including water and sewer utilities. Governmental and non-profit entities served include the following: Counties: St. Lucie County Municipalities: City of Fort Pierce City of Stuart - 22 - Commitment to Quality Service Personnel Qualifications and Experience David F. Naughton, CPA (Continued) Accounting and Audit Manager Professional Experience (Continued) Special Districts: Bluewaters Community Development District Country Club of Mount Dora Community Development District Fiddler's Creek Community Development District#1 and #2 Indigo Community Development District North Springs Improvement District Renaissance Commons Community Development District St. Lucie West Services District Stoneybrook Community Development District Summerville Community Development District Terracina Community Development District Thousand Oaks Community Development District Tree Island Estates Community Development District Valencia Acres Community Development District Non-Profits: The Dunbar Center, Inc. Hibiscus Children's Foundation, Inc. Hope Rural School, Inc. Maritime and Yachting Museum of Florida, Inc. Tykes and Teens, Inc. United Way of Martin County, Inc. Workforce Development Board of the Treasure Coast, Inc. • While with the Auditor General's Office he was on the staff for the state audits of the Martin County School District and Okeechobee County School District. • During 1997 he performed a technical review of the Florida Institute of Certified Public Accountants state CPE course on Audits of State and Local Governments in Florida. His comments were well received by the author and were utilized in future updates to the course. Continuing Professional Education • During the past several years, he has participated in numerous professional development training programs sponsored by the AICPA and FICPA, including state conferences on special districts and governmental auditing in Florida. He averages in excess of 100 hours bi-annually of advanced training which exceeds the 80 hours required in accordance with the continuing professional education requirements of the Florida State Board of accountancy and the AICPA Private Companies Practice Section. He has over 75 hours of governmental CPE credit within the past two years. - 23 - Commitment to Quality Service Personnel Qualifications and Experience Matthew Gonano, CPA Senior Staff Accountant— 10 years Education • University of North Florida, B.B.A. —Accounting • University of Alicante, Spain — International Business • Florida Atlantic University —Masters of Accounting Professional Affiliations/Community Service • American Institute of Certified Public Accountants • Florida Institute of Certified Public Accountants Professional Experience • Senior Accountant with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. • Performed audits of nonprofit and governmental organizations in accordance with Governmental Accounting Auditing Standards (GAAS) • Performed Single Audits of nonprofit organizations in accordance with OMB Circular A-133, Audits of State, Local Governments, and Non-Profit Organizations. Continuing Professional Education • Mr. Gonano has participated in numerous continuing professional education courses. - 24- Commitment to Quality Service Personnel Qualifications and Experience Paul Daly Staff Accountant— 9 years Education • Florida Atlantic University, B.S. —Accounting Professional Experience ♦ Staff Accountant with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. Continuing Professional Education • Working to attain the requirements to take the Certified Public Accounting (CPA) exam. - 25- Commitment to Quality Service Personnel Qualifications and Experience Melissa Marlin Senior Staff Accountant—7 years Education • Indian River State College, A.A. —Accounting • Florida Atlantic University, B.B.A. —Accounting Professional Experience • Staff accountant with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. Continuing Professional Education • Mrs. Marlin participates in numerous continuing professional education courses provided by nationally recognized sponsors to keep abreast of the latest developments. • Mrs. Marlin is currently studying to pass the CPA exam. - 26 - Commitment to Quality Service Personnel Qualifications and Experience Bryan Snyder Staff Accountant—5 years Education • Florida Atlantic University, B.B.A. —Accounting Professional Experience • Accountant beginning his professional auditing career with Berger, Toombs, Elam, Gaines, & Frank. • Mr. Snyder is gaining experience auditing governmental & nonprofit entities. Continuing Professional Education • Mr. Snyder participates in numerous continuing education courses and plans on working to acquire his CPA certificate. • Mr. Snyder is currently studying to pass the CPA exam. - 27 - Commitment to Quality Service Personnel Qualifications and Experience Maritza Stonebraker Staff Accountant—4 years Education • Indian River State College, B.S.A. —Accounting Professional Experience • Staff Accountant beginning her professional auditing career with Berger, Toombs, Elam, Gaines, & Frank. Continuing Professional Education • Mrs. Stonebraker participates in numerous continuing education courses and plans on acquiring her CPA. • Mrs. Stonebraker is currently studying to pass the CPA exam. - 28 - Commitment to Quality Service Personnel Qualifications and Experience Jonathan Herman, CPA Senior Staff Accountant—7 years Education • University of Central Florida, B.S. —Accounting • Florida Atlantic University, MACC Professional Experience • Accounting graduate with five years experience with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. Continuing Professional Education • Mr. Herman participates in numerous continuing professional education courses provided by nationally recognized sponsors to keep abreast of the latest developments. - 29- Commitment to Quality Service Personnel Qualifications and Experience Sean Stanton, CPA Staff Accountant—4 years Education • University of South Florida, B.S. —Accounting • Florida Atlantic University, M.B.A. —Accounting Professional Experience • Staff accountant with Berger, Toombs, Elam, Gaines, & Frank auditing governmental and non-profit entities. Continuing Professional Education • Mr. Stanton participates in numerous continuing professional education courses provided by nationally recognized sponsors to keep abreast of the latest developments. - 30- Commitment to Quality Service Personnel Qualifications and Experience Taylor Nuccio Staff Accountant—3 years Education ♦ Indian River State College, B.S.A. —Accounting Professional Experience ♦ Staff Accountant with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. Continuing Professional Education ♦ Ms. Nuccio participates in numerous continuing professional education courses provided by nationally recognized sponsors to keep abreast of the latest developments. ♦ Ms. Nuccio is currently working towards completing an additional 30 hours of education to qualify to sit for CPA exam. - 31 - Commitment to Quality Service Personnel Qualifications and Experience Kirk Vasser Staff Accountant— 1 year Education ♦ Indian River State College, B.S.A. —Accounting Professional Experience • Staff Accountant with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. Continuing Professional Education • Mr. Vasser participates in numerous continuing professional education courses provided by nationally recognized sponsors to keep abreast of the latest developments. • Mr. Vasser is currently working towards completing an additional 30 hours of education to qualify to sit for CPA exam. - 32 - Commitment to Quality Service Personnel Qualifications and Experience Madison Ballash Staff Accountant— 1 year Education ♦ Indian River State College, B.S.A. —Accounting (May 2020) Professional Experience • Staff Accountant with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. Continuing Professional Education • Ms. Ballash participates in numerous continuing professional education courses provided by nationally recognized sponsors to keep abreast of the latest developments. ♦ Ms. Ballash is currently working towards completing an additional 30 hours of education to qualify to sit for CPA exam. - 33- IMBAGG ETT Judson B.Baggett I 6815 Dairy Road MBA,CPA,CVA,Partner Zephyrhills,FL 33542 REUTIMANN Marci Reutimann ' (813)788-2155 &ASSOCIATES,CPAS, PA CPA,Partner (813)782-8606 Report on the Firm's System of Quality Control To the Partners October 30,2019 Berger,Toombs,Elam,Gaines&Frank,CPAs,PL and the Peer Review Committee of the Florida Institute of Certified Public Accountants We have reviewed the system of quality control for the accounting and auditing practice of Berger,Toombs, Elam, Gaines&Frank,CPAs, PL, (the firm), in effect for the year ended May 31,2019.Our peer review was conducted in accordance with the Standards for Performing and Reporting on Peer Reviews established by the Peer Review Board of the American Institute of Certified Public Accountants(Standards). A summary of the nature, objectives, scope, limitations of, and the procedures performed in a System Review as described in the Standards may be found at aicpa.orglprsummary.The summary also includes an explanation of how engagements identified as not performed or reported in conformity with applicable professional standards,if any,are evaluated by a peer reviewer to determine a peer review rating. Firm's Responsibility The firm is responsible for designing a system of quality control and complying with it to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. The firm is also responsible for evaluating actions to promptly remediate engagements deemed as not performed or reported in conformity with professional standards, when appropriate,and for remediating weaknesses in its system of quality control,if any. Peer Reviewer's Responsibility Our responsibility is to express an opinion on the design of the system of quality control, and the firm's compliance therewith based on our review. Required Selections and Considerations Engagements selected for review included engagements performed under Government Auditing Standards,including a compliance audit under the Single Audit Act. As a part of our peer review,we considered reviews by regulatory entities as communicated by the firm,if applicable,in determining the nature and extent of our procedures. Opinion In our opinion, the system of quality control for the accounting and auditing practice of Berger,Toombs, Elam,Gaines&Frank,CPAs, PL, in effect for the year ended May 31, 2019, has been suitably designed and complied with to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. Firms can receive a rating of pass,pass with deficiency(ies), or fail. Berger, Toombs, Elam, Gaines&Frank, CPAs, PL has received a peer review rating of pass. 7' o be k�4..t N�n.,� p nksc�, RAGGP REL`TIM AN?'&ASSOCIATES,CPAs,PA Member American Institute of Certified Public Accountants(AICPA)and Florida Institute of Certified Public Accountants(FICPA) National Association of Certified Valuation Analysts(NACVA) - 34- HERITAGE BAY COMMUNITY DEVELOPMENT DISTRICT REQUEST FOR PROPOSALS District Auditing Services for Fiscal Year 2020 Collier County, Florida INSTRUCTIONS TO PROPOSERS SECTION 1. DUE DATE. Sealed proposals must be received no later than 5:00 p.m. on Friday, October 16, 2020, Attention: Jack Arcurie, 10456 Heritage Bay Blvd., Naples, FL 34120 as well as one (1) electronic copy on a flash drive to Heritage Bay CDD c/o Inframark Infrastructure Management Services, 15275 Collier Blvd. #201-346, Naples, FL 34119. Proposals will be publicly opened at that time. SECTION 2. FAMILIARITY WITH THE LAW. By submitting a proposal, the Proposer is assumed to be familiar with all federal, state and local laws, ordinances, rules and regulations that in any manner affect the work. Ignorance on the part of the Proposer will in no way relieve it from responsibility to perform the work covered by the proposal in compliance with all such laws, ordinances and regulations. SECTION 3. QUALIFICATIONS OF PROPOSER. The contract, if awarded, will only be awarded to a responsible Proposer who is qualified by experience and licensing to do the work specified herein. The Proposer shall submit with its proposal satisfactory evidence of experience in similar work and show that it is fully prepared to complete the work to the satisfaction of the District. SECTION 4. SUBMISSION OF ONLY ONE PROPOSAL. Proposers shall be disqualified and their proposals rejected if the District has reason to believe that collusion may exist among the Proposers, the Proposer has defaulted on any previous contract or is in arrears on any previous or existing contract, or for failure to demonstrate proper licensure and business organization. SECTION 5. SUBMISSION OF PROPOSAL. Submit five (5) copies of the Proposal Documents and an electronic version, and other requested attachments at the time and place indicated herein, which shall be enclosed in an opaque sealed envelope, marked with the title "Auditing Services— Heritage Bay Community Development District" on the face of it. SECTION 6. MODIFICATION AND WITHDRAWAL. Proposals may be modified or withdrawn by an appropriate document duly executed and delivered to the place where proposals are to be submitted at any time prior to the time and date the proposals are due. No proposal may be withdrawn after opening for a period of ninety (90) days. SECTION 7. PROPOSAL DOCUMENTS. The proposal documents shall consist of the notice announcing the request for proposals, these instructions, the Evaluation Criteria Sheet and a proposal with all required documentation pursuant to Section 12 of these instructions (the "Proposal Documents"). SECTION 8. PROPOSAL. In making its proposal, each Proposer represents that it has read and understands the Proposal Documents and that the proposal is made in accordance therewith. - 35 - SECTION 9. BASIS OF AWARD/RIGHT TO REJECT. The District reserves the right to reject any and all proposals, make modifications to the work, and waive any informalities or irregularities in proposals as it is deemed in the best interests of the District. SECTION 10. CONTRACT AWARD. Within fourteen (14) days of receipt of the Notice of Award from the District, the Proposer shall enter into and execute a Contract (Engagement Letter)with the District. SECTION 11. LIMITATION OF LIABILITY. Nothing herein shall be construed as or constitute a waiver of District's limited waiver of liability contained in Section 768.28, Florida Statutes, or any other statute or law. SECTION 12. MISCELLANEOUS. All proposals shall include the following information in addition to any other requirements of the proposal documents. A. List position or title of all personnel to perform work on the District audit. Include resumes for each person listed; list years of experience in present position for each party listed and years of related experience. B. Describe proposed staffing levels, including resumes with applicable certifications. C. Three references from projects of similar size and scope. The Proposer should include information relating to the work it conducted for each reference as well as a name, address and phone number of a contact person. D. The lump sum cost of the provision of the services under the proposal. E. Must perform the audit fieldwork at the office where the District records are maintained. SECTION 13. PROTESTS. Any protest regarding the Proposal Documents, must be filed in writing, at the Offices of the District Manager, within seventy-two (72) hours after the receipt of the proposed contract documents. The formal protest setting forth with particularity the facts and law upon which the protest is based shall be filed within seven (7) calendar days after the initial notice of protest was filed. Failure to timely file a notice of protest or failure to timely file a formal written protest shall constitute a waiver of any right to object or protest with respect to the Proposal Documents. SECTION 14. EVALUATION OF PROPOSALS. The criteria to be used in the evaluation of proposals are presented in the Evaluation Criteria Sheet, contained within the Proposal Documents. - 36 - .x �T I lel inc You Shine ..:.,„:„.„... .•....-.,,,,..,;. ., 71.1,4.„,,,-,ia&-,7. � 4 1ul! ry W Ar w}��' ' . . .I,�� • W J�4 M 1W .fir 1, k .: ,, , _ \_ .'+err- _, ,...r-__. L '' s. # . - 1 PROPOSER Carr,Riggs&Ingram hiimmi�� R' CAR R RIGGS & 500 Grand Boulevard,#210 INGRAM ,. .ar`.f,;Ica r. .:11.4.4 Ce.1 Miramar Beach, FL 32550 t Beach, CPAs and Advisors PROPOSAL FOR CRlcpa.com Heritage Bay Community SUBMITTED BY Development District K.Alan Jowers Jonathan Hartness Engagement Partner Concurring Partner AJowers@CRlcpa.com JHartness@CRlcpa.com October 16, 2020 Dear Heritage Bay Community Development District: Carr, Riggs & Ingram, LLC (CRI) appreciates the opportunity to propose on auditing services to Heritage Bay Community Development District. We are genuinely excited about the prospect of serving you and establishing a long-term relationship. We pride ourselves on getting to know our clients and illuminating solutions by providing innovative ideas to move them from compliance to providing them a competitive advantage. Investment in You. We believe in developing long-term, mutually beneficial relationships and quickly demonstrating value with a fee structure and service solutions that provide immediate and continued savings. Our investment starts on "Day 1" as your assigned team begins with our proven, streamlined process that minimizes your time and disruption during the service provider change and continues throughout the relationship. Dedicated Team. CRI's team consists of more than 1,900 professionals, which allows us to tailor your service team by aligning their industry, service, and specialty skills with your needs. Our dedicated teams deliver the highest level of business acumen and knowledge to your organization; our commitment to consistent staffing allows you to maximize savings and remain focused on your needs. Equilibrium. CRI delivers big firm expertise with small firm service. Of approximately 45,000 public accounting firms in the United States, CRI currently ranks in the top 25.Additionally, as a part of PrimeGlobal, an association of independent accounting firms, we have access to international resources as-and when -needed. Leveraging these resources while maintaining local decision-making authority means that simplified solutions are only a phone call away.And we believe that's the best of both worlds for our clients. Active Partner Participation. Collectively, our partners deliver expertise derived from more than 7,500 years of business experience. With this level of talent, we thoughtfully choose a partner that aligns with your business' needs and industry. Our hands-on, working partners "show up" to convey our genuine commitment to your success. They strive to earn trusted advisor roles by digging in, proactively learning your business, and producing long-term value for you. Simplified Solutions. While our 500+ cumulative partner certifications is an impressive statistic, success is measured by translating complex concepts into client solutions. While accounting is the language of business, we're here to decipher the jargon and help you make educated decisions. CRlnnovate embraces agility and invention. The CRI vSTARTM process, our initiative delivering a virtual audit, is designed to provide you with maximized efficiencies, reduced workload, and an improved experience. We welcome the opportunity to demonstrate to you the same teamwork, expertise, innovation, and responsiveness that have made us one of the fastest growing public accounting firms in the United States. Again,we appreciate your consideration. Sincerely, K.Alan Dowers Engagement Partner CRlcpa.com CARR, RIGGS& INGRAM TABLE OF CONTENTS YOUR NEEDS UNDERSTANDING & MEETING YOUR NEEDS 4 YOUR SERVICES&FEES YOUR SERVICES & FEES 5 YOUR CHOICE: CRI FIRM PROFILE 6 GOVERNMENT CREDENTIALS 7 RELEVANT EXPERIENCE 8 YOUR SOLUTION TEAM 9 DELIVERING QUALITY TO YOU 15 WORKING TOGETHER: OVERVIEW SHARING CRI'S VALUES WITH YOU 16 TRANSITIONING YOU 17 CRI'S GLOBAL RESOURCES 18 JOIN OUR CONVERSATION 19 WORKING TOGETHER: DETAILS CRI AUDIT FRAMEWORK 20 CRI AUDIT APPROACH 22 APPENDIX APPENDIX A- RFP DOCUMENTS 24 CRlcpa.com CARR, RIGGS& INGRAM 3 UNDERSTANDING & MEETING YOUR NEEDS From the RFP or during our recent visit with your team, we understood your team to express the following needs, requests, and/or issues. We've detailed our proposed solutions below and are happy to discuss other related projects as they arise and upon request. a .o, NEEDS&ISSUES SOLUTIONS&SERVICES Technical The District is required to have independent audits Perform external audit services in performed on its financial statements. accordance with auditing standards generally accepted in the United States of America (GAAS), in order to express an opinion on the Heritage Bay Community Development District's financial statements. Relational The District's Board of Supervisors and management Communicate expect open and continuous communication with contemporaneously and directly their CPA firm in order to avoid surprise findings at with management regarding the the end of the audit. results of our procedures. Anticipate and respond to concerns of management and/or the Audit Committee(if/when formed). CRlcpa.com CARR, RIGGS& INGRAM YOUR SERVICES & FEES 1111 We value creating mutually rewarding, long-term relationships with our clients. Our goal is to provide high quality, responsive service that yields returns far greater than your investment in our professional fees. Please find below our proposal of fees to provide the requested services for the upcoming fiscal years. SERVICE CRI FEES CRI FEES CRI FEES 2020 2021 2022 Perform external audit services in accordance with $6,000 $6,100 $6,250 auditing standards generally accepted in the United States of America (GAAS) *Actual out-of-pocket expenses will be billed separately and are not included in the fee. If Heritage Bay Community Development District requests additional services outside of this proposal, professional fee hourly rates are as follows, but may be negotiated depending on the project request: CLASSIFICATION HOURLY RA Partner $400 Manager $300 Senior $190 Staff $140 IT Specialist $250 Fraud Specialist $250 Our professional fees are based on the key assumptions that Heritage Bay Community Development District will: • Ensure that the predecessor's work papers will be made available for timely review. • Make available documents and work papers for review at Heritage Bay Community Development District's headquarters location, although we may choose to review at alternate locations. • Prepare certain schedules and analyses and provide supporting documents as requested. • Assist us in obtaining an understanding of the accounting systems of Heritage Bay Community Development District. • Not experience a significant change in business operations or financial reporting standards. CRlcpa.com CARR, RIGGS& INGRAM 5 NI CRI FIRM PROFILE i 1997 104111011k 25+ SERVICES I MU 1 900-}- _ 300.}. counting&Auditing PROFESSIONALS PARTNERS Advisory Business Support&Transactions Business Tax Employee Benefit Plans Governance, Risk&Assurance Individual Tax&Planning TOP 25 CPA FIRM IT Audits&Assurance ,4 r raked by Accounting Today) INDUSTRY EXPERTISE Captive Insurance Construction Financial Institutions 100,000+ Governments CLIENTS Healthcare Institutional Real Estate lir 411111( Insurance 20+ YEARS Manufacturing& distribution Nonprofits OF CONSISTENT GROWTH SINCE FORMATION CRI FAMILY OF COMPANIES I Auditwerx of CRI Advanced Analytics h A CRl Capital Advisors CRI 1=IRM VALUES. CRISolutionsGroupCLIENT SERVICE. �''� CRi TPA Services RESPECT. !j- Level Four Advisory Services INTEGRITY. -` 0 Paywerx JNVIELDING INTEGRITY * Preferred Legacy Trust CRlcpa.com CARR, RIGGS& INGRAM 5 GOVERNMENT CREDENTIALS 1111 CRI'S GOVERNMENTAL EXPERTISE : III Audit and Consulting Services for Governmental 500+ • '` �governmental Partner entities with annual revenues Designations totaling $24 Billion Including: CPA, CGFM, CITP, CFE, CMA, CISA, CGEIT, CTGA, CFF, CGMA,and CGAP CLIENTS WITH ANNUAL REVENUES UP TO: 220+ single audits performed annually 90+ School Districts Consulting and other agreed upon $1 . 1 B i l l i o n procedures engagements for 150 goverment entities 100+ Municipalities Single Audit Resource Center's $1 .8 Billion Award for Excellence in Knowledge. Value, and Overall Client Satisfaction 60+ Agencies/Authorities Member of AICPA's Government $3 Billion Audit Quality Center CRlcpa.com CARR, RIGGS& INGRAM RELEVANT EXPERIENCE 111 CRI delivers a depth of resources that ensures our understanding of your challenges and innovative solutions for overcoming them. Our team's combined experience is derived from providing audit, tax, consulting, and accounting outsourcing services.We parlay this vast experience and derived best practices into proven solutions that benefit you. Below we share specific, relevant client references;we encourage you to consult with them. RELATIONSHIP TIMELINE SERVICE RELEVANT POINTS TO CONSIDER DESCRIPTION Rizzetta &Company 2006-Present Annual Financial • Client service experience Shawn Wildermuth Statement Audits of • Responsiveness to client 3434 Colwell Avenue Multiple CDDs needs Suite 200 • Long-term relationship Tampa, FL 33614 • CDD management co. 813.933.5571 GMS, LLC 2006- Present Annual Financial • Client service experience Dave DeNagy Statement Audits of • Responsiveness to client 14785 Old St.Augustine Road Multiple CDDs needs Suite 4 • Long-term relationship Jacksonville, FL 32258 • CDD management co. 904.288.9130 Wrathell, Hunt&Associates, LLC 2006- Present Annual Financial • Client service experience Jeffrey Pinder Statement Audits of • Responsiveness to client 2300 Glades Road Multiple CDDs needs Suite 410W • Long-term relationship Boca Raton, FL 33431 • CDD management co. 561.571.0010 PFM Group Consulting, LLC 2007- Present Annual Financial • Client service experience Jennifer Glasgow Statement Audits of • Responsiveness to client 12051 Corporate Blvd. Multiple CDDs needs Orlando, FL 32817 • Long-term relationship 407.382.3256 • CDD management co. CRlcpa.com CARR, RIGGS& INGRAM YOUR SOLUTION TEAM U K. Alan Jowers Engatement Partner AJowers@CRlcpa.com 850.337.3213 I Direct Experience Representative Clients Alan has over 25 years of experience in public accounting primarily with • Santa Rosa County financial statement assurance engagements. His practice includes local District School Board governmental entities, condominium and homeowner associations, non- • Okaloosa Gas District profit organizations, and nonpublic companies. He currently has direct • Santa Rosa Island engagement responsibility for a significant number of audits throughout Authority the state of Florida • Pasco County Alan is licensed to practice as a certified public accountant in Florida and • Okaloosa County Georgia. He is a member of the Board of Directors of the Florida Institute of District School Board Certified Public Accountants (FICPA), has been an active member of the • Pinellas County School FICPA's State and Local Governmental Committee, and is a past chair of its District Common Interest Realty Association Committee. He is also active in the • Celebration Community Panhandle Chapter of the Florida Governmental Finance Officers Development District Association (FGFOA) and is a former member of the FGFOA's statewide • Hammock Bay Technical Resource Committee. Community Development District Education, Licenses&Certifications • Amelia National • Masters of Accountancy, University of Alabama Community • BS,Accounting, Florida State University Development District • Certified Public Accountant Professional Affiliations • American Institute of Certified Public Accountants(AICPA) • Florida Institute of Certified Public Accountants (FICPA) - member of the Board of Governors • Governmental Finance Officers Association(GFOA) • Florida Governmental Finance Officers Association(FGFOA) CRlcpa.com CARR, RIGGS& INGRAM 111 YOUR SOLUTION TEAM Jonathan Hartness Concurring Partner rtNew JHartness@CRlcpa.com 850.337.3569 I Direct Experience Representative Clients Jonathan has over 12 years of auditing and accounting experience • Community with CRI. He is responsible for audits, reviews and compilations of Development Districts local governmental entities, condominium and homeowner • Condominium and associations, and non-public companies. Homeowner Associations Jonathan is licensed to practice as a Certified Public Accountant in Florida. He is a member of the American Institute of Certified Public Accountants and the Florida Institute of Certified Public Accountants. He exceeds all continuing professional education requirements related to Government Auditing Standards. Jonathan currently supervises engagements for many governmental entities in the State of Florida including community development districts. He is active in our firm's governmental industry line as well as our condominium and homeowner association practice. Jonathan is an integral part of our community development district practice. Education, Licenses&Certifications • MAcc,Accounting, University of West Florida • Certified Public Accountant • Community Association Manager(CAM), Licensed in Florida Professional Affiliations • American Institute of Certified Public Accountants(AICPA) • Florida Institute of Certified Public Accountants(FICPA) CRlcpa.com CARR, RIGGS& INGRAM YOUR SOLUTION TEAM Stephen Riggs, IV Consulting Partner SCRiggs@CRlcpa.com 850.337.3548 I Direct Experience Representative Clients Stephen has over 17 years accounting and audit experience, including • Community three ears with the international Development Districts y public accounting firm, Ernst & Young, LLP. His experience includes numerous clients in industries • Condominium and including governmental, not-for-profit, healthcare, SEC and privately Homeowner held corporations. Associations • County and Local Stephen is licensed topractice as a certified Governments p public accountant in Florida. He is a member of the State and local Governmental section • Non-Profit Organizations of the Florida Institute of Certified Public Accountants and exceeds all • Privately-held continuing professional education requirements related to corporations Government Auditing Standards. He is currently a partner on engagements for many special districts in the State of Florida, including community development districts, fire districts and school districts. In addition to his public accounting experience, Stephen has served on the Board of Directors for a Community Development District and a non-profit organization. Education, Licenses&Certifications • Masters of Accountancy, University of West Florida • BA, Economics, University of Florida • Certified Public Accountant Professional Affiliations • American Institute of Certified Public Accountants(AICPA) • Florida Institute of Certified Public Accountants(FICPA) • Past President, Emerald Coast Chapter of Florida Institute of Certified Public Accountants(FICPA) CRlcpa.com CARR, RIGGS& INGRAM 11 YOUR SOLUTION TEAM U Grace Hartness Senior Manager GHartness@CRlcpa.com • . 850.337.3243 I Direct Experience Representative Clients Grace has over 12 years accounting and audit experience with CRI. • Community She has worked on several major construction companies, Development Districts government entities, community development districts, condominium • Condominium and and homeowner associations and non-profit organizations. In Homeowner addition, she has been involved in special audit projects for the Associations Miami-Dade Airport Authority. Grace is licensed to Utility Services p y practice as a • certified public accountant in Florida and exceeds all continuing • School Districts professional education requirements related to Government Auditing • County and Local Standards. In addition, Grace fluently speaks several languages Governments including French and Arabic. Grace currently supervises engagements • Non-Profit Organizations for many special districts in the State of Florida including community development districts and school districts. She is active in our firm's condominium and homeowner association practice. Grace started with CRI in August 2006, upon completion of her master's degree, and was promoted to manager in 2011. Education, Licenses& Certifications • MAcc,Accounting, University of West Florida • Certified Public Accountant • Community Association Manager(CAM), Licensed in Florida Professional Affiliations • American Institute of Certified Public Accountants(AICPA) • Florida Institute of Certified Public Accountants(FICPA) • Accounting& Financial Women's Alliance(AFWA) CRlcpa.com CARR, RIGGS& INGRAM 12 YOUR SOLUTION TEAM Chad Branson Senior Manager CBranson@CRlcpa.com 850.337.3226 I Direct Experience Representative Service Chad Branson has over 17 years of experience in public accounting, Areas with practice concentrations in auditing governmental, nonprofit and • Local Governments for profit entities. Chad has accumulated experience throughout his including Water and career in Federal and Florida Single Audit Acts compliance monitoring Sewer Organizations and and auditing. During his career he has supervised and managed audit Fire Districts engagements for a wide variety of governmental and nonprofit • School Districts including organization clients.ln addition, he has performed internal audit work, Foundations information technology general controls testing, forensic • Nonprofit Organizations investigations, and risk assessments for governmental entities. Representative Clients Chad has been with Carr, Riggs and Ingram, LLC since 2005. (including previous clients) • School Districts- Pinellas Education, Licenses& Certifications County, Okaloosa • Bachelor and Master of Accountancy - University of Mississippi, County, Pasco County, Oxford MS Santa Rosa County • Certified Public Accountant (CPA) - Licensed in Florida and • Florida Office of Early Mississippi Learning Coalition • Community Association Manager(CAM)- Florida • Florida Department of • Certified Information Technology Professional-AICPA Elder Affairs • Fire Districts-Destin, Professional Affiliations Ocean City, North Bay • American Institute of Certified Public Accountants(AICPA) • Utilities- Regional • Florida Institute of Certified Public Accountants(FICPA) Utilities,Midway Water • Emerald Coast Chapter(FICPA) Board Systems, Inc.,Emerald • Florida Governmental Finance Officers Association (FGFOA) Coast Utilities Authority • Escambia County CRlcpa.com CARR, RIGGS& INGRAM YOUR SOLUTION TEAM 111 Lauren Villarreal Supervising Senior LVillarreal@CRlcpa.com 850.337.3223 I Direct Experience Representative Service Lauren has four years auditing and accounting experience in the Destin office of Areas CRI.She is an audit supervising senior with primary responsibility for fieldwork and • Community reporting on audits of clients in a variety of industries including local governmental Development Districts and non-profit entities as well as employee benefit plans and commercial • Condominium and businesses. She is currently the in-charge auditor for over a dozen community Homeowner development districts with several CDD management companies in the State of Associations Florida. • Employee Benefit Plans • County and Local Lauren is licensed to practice as a Certified Public Accountant in Florida. She is a Governments member of the American Institute of Certified Public Accountants and the Florida • Non Profit Organizations Institute of Certified Public Accountants. She exceeds all continuing professional education requirements related to Government Auditing Standards. Lauren currently supervises engagements for many governmental entities in the State of Florida including community development districts and other special governments. She is active in our firm's governmental industry line as well as the condominium and homeowner association practice. In addition, Lauren has accumulated experience in Federal and Florida Single Audit Acts compliance monitoring and auditing. Lauren has performed several single audits of federal grants under OMB Circular A-133. Education,Licenses&Certifications • BS,Accounting,Florida State University • BS,Business Administration,Florida State University • Certified Public Accountant • Community Association Manager(CAM),Licensed in Florida Professional Affiliations • American Institute of Certified Public Accountants(AICPA) • Florida Institute of Certified Public Accountants(FICPA) CRlcpa.com CARR, RIGGS& INGRAM 14 DELIVERING QUALITY TO YOU AUDIT METHODOLOGY Our audit, tax, consulting, and client accounting services documentation is maintained electronically. Compliance with our methodology is regularly reviewed and evaluated as part of our internal quality program, which is further discussed in this section under INTERNAL QUALITY CONTROL REVIEWS AND EXTERNAL REVIEWS. Comprehensive policies and procedures governing all of our practices and addressing professional and regulatory standards and implementation issues are constantly updated for new professional developments and emerging issues. See the table of contents to identify the relevant audit approach and methodology detailed description section. ENGAGEMENT QUALITY REVIEW PARTNER(CONCURRING PARTNER) Audit engagements are assigned engagement quality review (EQR) partner, as appropriate. This role is one of the most important elements of our quality assurance process, as it provides for a timely, independent review of key accounting and auditing issues. The EQR partner also reviews the financial statements and related supporting documentation—including the disclosures—to evaluate their fair presentation under accounting principles generally accepted in the United States of America (GAAP). INTERNAL QUALITY CONTROL REVIEWS AND EXTERNAL REVIEWS Experienced partners and professional staff of our firm conduct quality control reviews of our audits. Our partners'work is reviewed annually, and the inspection process includes periodic testing of the effectiveness of our quality controls and a continuous improvement program. This risk-based annual inspection is intended to mimic the triennial peer review described in the following paragraph and are performed on completed engagements. In addition to this inspection, we perform in-process, "pre-issuance" reviews of partners' work that are chosen for using a risk-based selection process; these reviews are performed by our corporate quality control team. The combination of the in-process and completed engagements is part of our continuous improvement processes. Peer reviews are performed every three years by another independent public accounting firm. The most recent review of our firm was performed in 2019 by Brown Edwards, whose report was the most favorable possible "Pass". In addition, we are registered with the PCAOB and our 2018 PCAOB inspection report was also the most favorable possible—no audit deficiencies or quality control defects identified. The 2018 PCAOB report can be viewed at httpsn////pcaobus.org/Inspections/Reports/Documents/104-2019-029-Carr-Riggs-Ingram-LLC.pdf. CRlcpa.com CARR, RIGGS& INGRAM 15 1111 SHARING CRI'S VALUES WITH YOU in We are proud of our hands-on, service-centric, and results-oriented approach. Combining that approach with quality controls and superior talent allows us to help you achieve your goals and strengthen your management systems and processes. This approach is further emphasized through our three core values which guide our team's behavior and function as the foundation for interactions with our clients and each other. J441 J� (fry ,O Mit Off- . MINK UNYIELDING INTEGRITY CLIENT SERVICE / INTEGRITY j Defining our brand by meeting Building productive, long- Living with sincerity, or exceeding the highest term relationships with each transparency, and honesty expectations of our clients other that are based on mutual respect, trust, and sharing CRlcpa.com CARR, RIGGS& INGRAM 16 TRANSITIONING YOU I When choosing to change firms, the time involved in working with new accounting professionals is often a concern. CRT's well-defined efficient, seamless transition process is designed to: • Provide you with value from the very first encounter, • Avoid interruption of service, • Minimize disruption and investment of management's time, • Raise the standard of service, and • Establish ongoing channels of communication with Heritage Bay Community Development District's management. The transition plan is comprised of the following key activities and can occur within approximately two weeks, depending on the availability of the parties involved: • Management approves the • CRI and management sign change in firms, pending engagement letter. new firm's completion of • Management notifies . CRI and management client acceptance predecessor firm of decision procedures. to change service providers. develop communication plan protocol. • CR1 performs client • CRI makes inquiries of and . CRI and management acceptance procedures, reviews predecessor firm finalize timetable and key such as: workpapers related to your prior year's audit and tax dates. - Interview key service services (as applicable). provider relationships pp • CRI develops initial • Predecessor firm provides understanding of your - Interview predecessor copies of requested business processes. firm. workpapers. • CR1 reports to management - Internal firm review and process review items approval. subsequent to initial planning stage. PRE-APPROVAL & CLIENT ACCEPTANCE UNDERSTANDING & PLANNING CRlcpa.com CARR, RIGGS& INGRAM 17 CRI'S GLOBAL RESOURCES Many businesses are expanding and/or evaluating their global reach, and they require assistance in order to comprehensively consider the various financial implications of growing in international markets. In addition to CRI's internal resources, we deliver the expertise and support of some of the world's most highly regarded accounting firms through shared alliance as members of PrimeGlobal. WHO IS PRIMEGLOBAL? PrimeGlobal An Association of Independent Accounting Firms Rev: ,L e Countries Offices Staff F'rart��rr, $2.9B+ 80+ 850+ 16,000+ 2,500+ 280+ HOW OUR PRIMEGLOBAL MEMBERS CAN BENEFIT YOU We supplement our in-depth, industry knowledge and specialized services through our collaborations with other PrimeGlobal firms to help you evaluate your options globally. CRI's goal is to provide you with the information you need to make well-informed, smart business decisions. 4 KEY BENEFITS TO CRI CLIENTS FROM OUR PRIMEGLOBAL MEMBERSHIP 2 3 4 SOLUTIONS ACCESSIBILITY DECISION MAKING SINGLE POINT that are worldwide to knowledge and with the support of OF CONTACT and world-class. resources of local connections CRI's team serves statutory, and cultural as your contact for regulatory, and understanding each engagement, compliance throughout regions and we project requirements of the world. manage across the throughout the entire team world, including other PrimeGlobal firms and specialists. CRlcpa.com CARR, RIGGS& INGRAM 18 JOIN OUR CONVERSATION We know that some information that makes perfect sense to a CPA may not be as clear to our clients.Therefore, we produce original content in the form of articles, videos, white papers, webinars, and more to provide timely, down-to-earth translations of complex subjects. We publish this original content on CRlcpa.com and across all our many social channels. FOLLOW CRI ON SOCIAL MEDIA f �1` O 0in SUBSCRIBE TO THE CRI E-NEWSLETTER CRICPA.COM /N EWSLETTER-SIGNUP IT FIGURES: THE CRI PODCAST F\GU,4? Created to provide insight into the latest developments and regulations in the accounting and finance space, It Figures is an accounting and advisory focused podcast for business and organization leaders, entrepreneurs, and anyone who is looking to go beyond the status quo. Listen on Apple Podcasts, Spotify, iHeart Radio, and more. it figurespodcast.com CRI's CEO ACTION FOR DIVERSITY AND INCLUSION ACTS ON c wit Carr, Riggs & Ingram is committed to fostering an inclusive and diverse place for all employees to work in and engage. When our managing 'AMON] ; partner and chairman, Bill Carr, signed the CEO Action for Diversity & InclusionT"' pledge, he made a public commitment to building a productive, diverse, and inclusive workplace. Learn more about CRI's commitment to Diversity and Inclusion. CRlcpa.com CARR, RIGGS&INGRAM �cs CRI AUDIT FRAMEWORK Our proposed services require a coordinated effort between us and Heritage Bay Community Development District's team. Planning and continual communication are essential to developing the appropriate procedures, working collaboratively to resolve any identified issues, and meeting your timelines. CRI's audit approach occurs within a framework of our client's business and industry; therefore, we assess risk by: • Understanding management's perspectives and goals, and • Considering business conditions and threats that could prevent management from achieving its business objectives. We assess risks in the following areas: • Acquisition,Divestiture& • Materiality Reorganization • Financial Reporting • Audit Committee& Compliance Management Expectations • New Accounting • Operating Results Pronouncements • Banking Covenant Requirements FINANCIAL BUSINESS ENVIRONMENT • Investor/Market Expectations • Internal Control Environment • Technological Innovation • IT Systems&Support • Legislative/Regulatory Changes CRlcpa.com CARR, RIGGS& INGRAM 20 CRI AUDIT FRAMEWORK ■ Our ultimate intent is to drill down from these broad risks to specific financial reporting risks. We understand both these risks and management's processes and procedures for mitigating them (i.e. internal controls) in order to develop our procedures to carry out our audit responsibilities. Although our audits are conducted through a structured, risk-based model, we focus on understanding the client's needs, requirements, and expectations. We work collaboratively with management and the Audit Committee (or similar function) to develop a communication and work plan to continuously improve client service, by doing so we help in moving your team from simple compliance to providing you with a competitive advantage. In planning, we concentrate on "key risks," (items with a greater risk of a material misstatement, a material weakness in internal controls, or other matters resulting in the issuance of an inappropriate audit report). We focus on "material" items (i.e. those items that would be important to the user of your financial statements). When evaluating materiality of identified misstatements, certain quantitative and qualitative factors must be considered—which may include: • Impact on operating trends(revenue/income, expenses, net income, etc). • Nature of the misstatement(i.e., did the misstatement result from an unlawful transaction?). • Impact on liquidity, capital/surplus, earnings capacity, etc. • Impact to loan covenants and contractual and regulatory requirements. Consistent communication is a key to completion of the audit. By ensuring constant involvement, we are in a better position to respond to your issues timely and efficiently. Therefore, we plan to meet with your management to: • Set-up the audit by reviewing the mapping of Heritage Bay Community Development District's financial information (financial statements and notes) to significant processes and IT systems to ensure that all significant account balances,transactions, procedures, and systems are tested as deemed necessary. • Discuss ongoing changes—specifically new accounting pronouncements and key business transactions in their early stages, enabling us to agree on the resolution of various complex business issues on a timely basis. CRlcpa.com CARR, RIGGS& INGRAM 21 III CRI AUDIT APPROACH III Our audit approach is a four stage approach, as depicted in the summary below. Our client acceptance and risk assessment procedures occur during detailed conversations and observations with your team. The results of those procedures allow us to tailor an audit program to your specific risks and needs. We then execute the audit, report the results, and evaluate continuous improvement opportunities for ongoing service and benefit to you. CLIENT ACCEPTANCE RISK ASSESSMENT& AUDIT &PRE-PLANNING —4 AUDIT STRATEGY —> EXECUTION '--) O bA 4i C cS Operational& 2 Client Acceptance m Governance H Substantive Analytics .. � 4 H Finan cial H co Engagement Scopmg a Test of Details Understand and Evaluate -Significant Transactions, I Processes&Related Controls Team Orientation General Audit Procedures Test Controls,as appropriate COMPLIANCE TO COMPETITIVE ADVANTAGE CR1cpa.com CARR, RIGGS& INGRAM 2 CRI AUDIT APPROACH 111 III STAGE 1:CLIENT ACCEPTANCE& PRE-PLANNING STAGE 3:AUDIT EXECUTION • Perform client acceptance procedures. • Where possible to test as efficiently as possible: • Collaborate with management to agree to expectations and - develop detailed analytical procedures to use as scope. substantive tests(benefit=reducing tests of details): • Assign appropriate staff based on client needs and assessed Examples include: risk. • ratio analysis, • regression analysis, • trend analysis, STAGE 2:RISK ASSESSMENT&AUDIT STRATEGY • predictivetests, r • reason reasonableness teest, - utilize Computer-Assisted Audit Techniques(CAATs) • Interview client personnel and others to understand (benefit=automation of testing for more coverage and client-specific objectives and risks. less disruption to the client),and • Assess following aspects of the organization for their impact - perform targeted testing(also known as"coverage" on the audit plan: testing)to test large portions of account balances - environmental and other external risks, (benefit=more coverage with smaller selections). - management's fraud and IT risk assessment models, • Perform tests of details,including sampling. - entity level controls including: • Perform general audit procedures such as tests related to: • control environment - commitments and contingencies, • risk assessment, - legal letters, • information and communication, - management representations, • and monitoring controls. - reviews of Board minutes, - IT General Computer(ITGC)controls,such as - related party transactions, • IT Environment - debt covenants,and • Developing and Delivering IT,and - going concern. • Operating and Monitoring IT. • Perform other tests for compliance such as Yellow Book or • Determine materiality. Single Audit tests. • Develop and document our understanding of and/or reliance on: - linkage of financial statements to: • significant transactions, • processes, • IT systems,and • Continually monitor throughout the audit-providing • related controls, feedback as agreed during scoping. - existence of/reliance on SOC entities and their reports, • Conclude the audit(i.e.issue opinions and reports). - internal audit,and • Develop and present: - specialists(e.g.valuation,pension costs,etc.). - reports, • If elected,test controls including ITGC,through a mix of: required communications, - inquiry, - management letter comments,and - observation - other audit-related deliverables. - examination,and 1 • Perform debriefings to identify opportunities for - re-performance. improvement with our: • Perform preliminary analytical procedures. - engagement team,and/or • Finalize risk assessments and develop a final audit strategy. I II -client's team. CRlcpa.com CARR, RIGGS& INGRAM 23 APPENDIX A - RFP DOCUMENTS III Request for Proposals for Annual Audit Services for Heritage Bay Community Development District Heritage Bay Community Development District hereby requests proposals for annual financial auditing services. The proposal must provide for the auditing of the District's financial records for the fiscal year ending September 30. 2020, with an option for two additional annual renewals, The District is a local unit of special-purpose government created under Chapter 190, Flor- ida Statutes, for the purpose of financing, constructing, and maintaining public infrastructure. The District is located in County Collier and is approximately 687 acres in area, The District has an annual operating budget of approximately S2.053,057.00 inclusive of debt service. The Auditing entity submitting a proposal must be duly licensed under Chapter 473, Florida Statutes and be qualified to conduct audits in accordance with "Government Auditing Standards", as adopted by the Florida Board of Accountancy. Audits shall be conducted in accordance with Florida Law and particularly Sec- tion 218.39, Florida Statute, and the rules of the Florida Audi- tor General. The firm must perform the audit field work at the office where the District records are maintained. Proposal packages, which include evaluation criteria and in- structions to proposers are available from the District Manager at the address and telephone number listed below. Proposers must provide five (5) copies of their proposals Herit- age Bay CDD Audit Committee, Attention: Jack Arcurie, 10456 Heritage Bay Blvd.. Naples, FL 34120 as well as one (1) electronic copy on a flash drive to Heritage Bay CDD C/o inframark Infra- structure Management Services, 15275 Collier Blvd. 1201-346, Naples, FL 34119, Phone (239) 785-0675. Proposals must be re- ceived by 5:00 p.m. on Friday, October 16, 2020. The inner en• velope must be marked "Auditing Services - Heritage Bay Com• munity Development District." Please direct all questions regarding this Notice to the District Manager. Heritage Bay Community Development District Justin Fairdoth, District Manager September 16, 2020 *4371380 CRlcpa.com CARR, RIGGS& INGRAM APPENDIX A - RFP DOCUMENTS U HERITAGE BAY COMMt NIT\ DEVELOPMENT DISTRICT REQUEST FOR PROPOSALS District Auditing Services for Fiscal Year 2020 Collier County,Florida INSTRUCTIONS TO PROPOSERS SECTION 1. DUE DATE. Sealed proposals must be received no later than 5:00 p.m. on Friday, October 16, 2020, Attention: Jack Areurie, 10456 Heritage Bay Blvd., Naples, FL 34120 as well as one (1)electronic copy on a flash drive to Heritage Bay CDD do Inframark Infrastructure Management Services. 15275 Collier Blvd. #201-346, Naples, FL 34119. Proposals will be publicly opened at that time. SECTION 2. FAMILIARITY WITH THE LAW. By submitting a proposal, the Proposer is assumed to be familiar with all federal, state and local laws,ordinances,rules and regulations that in any manner affect the work. Ignorance on the part of the Proposer will in no way relieve it from responsibility to perform the work covered by the proposal in compliance with all such laws,ordinances and regulations. SECTION 3. QUALIFICATIONS OF PROPOSER. The contract,if awarded,will only be awarded to a responsible Proposer who is qualified by experience and licensing to do the work specified herein. The Proposer shall submit with its proposal satisfactory evidence of experience in similar work and show that it is fully prepared to complete the work to the satisfaction of the District. SECTION 4. SUBMISSION OF ONLY ONE PROPOSAL. Proposers shall be disqualified and their proposals rejected if the District has reason to believe that collusion may exist among the Proposers,the Proposer has defaulted on any previous contract or is in arrears on any previous or existing contract,or for failure to demonstrate proper licensure and business organization. SECTION 5. SUBMISSION OF PROPOSAL. Submit five (5) copies of the Proposal Documents and an electronic version, and other requested attachments at the time and place indicated herein, which shall be enclosed in an opaque sealed envelope, marked with the title "Auditing Services-Heritage Bay Community Development District"on the face of it. SECTION 6. MODIFICATION AND WITHDRAWAL. Proposals may be modified or withdrawn by an appropriate document duly executed and delivered to the place where proposals are to be submitted at any time prior to the time and date the proposals are due. No proposal may be withdrawn after opening for a period of ninety(90)days. SECTION 7. PROPOSAL DOCUMENTS. The proposal documents shall consist of the notice announcing the request for proposals,these instructions,the Evaluation Criteria Sheet and a proposal with all required documentation pursuant to Section 12 of these instructions (the "Proposal Documents"). SECTION 8. PROPOSAL. In making its proposal,each Proposer represents that it has read and understands the Proposal Documents and that the proposal is made in accordance therewith. 1 CRlcpa.com CARR, RIGGS& INGRAM 25 APPENDIX A - RFP DOCUMENTS III 1111 SECTION 9. BASIS OF AWARD/RIGHT TO REJECT. The District reserves the right to reject any and all proposals, make modifications to the work, and waive any informalities or irregularities in proposals as it is deemed in the best interests of the District. SECTION 10. CONTRACT AWARD. Within fourteen(14)days of receipt of the Notice of Award from the District, the Proposer shall enter into and execute a Contract (Engagement Letter)with the District. SECTION 11. LIMITATION OF LIABILITY. Nothing herein shall be construed as or constitute a waiver of District's limited waiver of liability contained in Section 768.28,Florida Statutes,or any other statute or law. SECTION 12. MISCELLANEOUS. All proposals shall include the following information in addition to any other requirements of the proposal documents. A. List position or title of all personnel to perform work on the District audit. Include resumes for each person listed; list years of experience in present position for each party listed and years of related experience. B. Describe proposed stalling levels, including resumes with applicable certifications. C. Three references from projects of similar size and scope. The Proposer should include information relating to the work it conducted for each reference as well as a name,address and phone number of a contact person. D. The lump sum cost of the provision of the services under the proposal. E. Must perform the audit fieldwork at the office where the District records are maintained. SECTION 13. PROTESTS. Any protest regarding the Proposal Documents, must be filed in writing, at the Offices of the District Manager, within seventy-two(72) hours after the receipt of the proposed contract documents. The formal protest setting forth with particularity the facts and law upon which the protest is based shall be filed within seven(7)calendar days after the initial notice of protest was filed. Failure to timely file a notice of protest or failure to timely file a formal written protest shall constitute a waiver of any right to object or protest with respect to the Proposal Documents. SECTION 14. EVALUATION OF PROPOSALS. The criteria to be used in the evaluation of proposals are presented in the Evaluation Criteria Sheet, contained within the Proposal Documents. 2 CRlcpa.com CARR, RIGGS& INGRAM 2e APPENDIX A - RFP DOCUMENTS II AUDITOR SELECTION EVALUATION CRITERIA 1. Ability of Personnel (20 Points) (E.g., geographic locations of the firm's headquarters or permanent office in relation to the project; capabilities and experience of key personnel; present ability to manage this project;evaluation of existing workload;proposed staffing levels,etc.) 2. Proposer's Experience. (20 Points) (E.g. past record and experience of the Proposer in similar projects; volume of work previously performed by the fine; past performance for other Community Development Districts in other contracts;character,integrity,reputation,of respondent.etc.) 3. Understanding of Scope of Work. (20 Points) Extent to which the proposal demonstrates an understanding of the District's needs for the services requested. 4. Ability to Furnish the Required Services. (20 Points) Extent to which the proposal demonstrates the adequacy of Proposer's financial resources and stability as a business entity necessary to complete the services required (E.g., the existence of any natural disaster plan for business operations). 5 Price. (20 Points) Points will be awarded based upon the price bid for the rendering of the services and reasonableness of the price to the services. CRlcpa.com CARR, RIGGS& INGRAM Grau & Associates CO CERTIFIED PUBLIC ACCOUNTANTS Proposal to Provide Financial Auditing Services: HERITAGE BAY COMMUNITY DEVELOPMENT DISTRICT Proposal Due: October 16, 2020 5:00PM Submitted to: Heritage Bay Community Development District c/o Jack Arcurie 10456 Heritage Bay Blvd. Naples, FL 34120 Submitted by: Antonio J. Grau, Partner Grau &Associates 951 Yamato Road, Suite 280 Boca Raton, Florida 33431 Tel (561) 994-9299 (800) 229-4728 Fax (561) 994-5823 tgrau( graucpa.com www.graucpa.com Graze & Associates CERTIFIED PUBLIC ACCOU• NTANTS Table of Contents PAGE EXECUTIVE SUMMARY/TRANSMITTAL LETTER 1 FIRM QUALIFICATIONS 3 FIRM &STAFF EXPERIENCE 6 REFERENCES 11 SPECIFIC AUDIT APPROACH 13 COST OF SERVICES 17 SUPPLEMENTAL INFORMATION 19 Grau & Associates CERTIFIED PUBLIC ACCOUNTANTS October 16,2020 • Heritage Bay Community Development District c/o Jack Arcurie 10456 Heritage Bay Blvd. Naples,FL 34120 Re: Request for Proposal for Professional Auditing Services for the fiscal year ended September 30, 2020,with an option for two(2)additional annual renewals. Grau & Associates (Grau) welcomes the opportunity to respond to the Heritage Bay Community Development District's (the "District") Request for Proposal (RFP), and we look forward to continuing working with you on your audit.We are an energetic and robust team of knowledgeable professionals and are a recognized leader of providing services to Community Development Districts.As one of Florida's few firms to primarily focus on government,we are especially equipped to provide you an effective and efficient audit. Special district audits are at the core of our practice:we have a total of 360 clients,329 or 91%of which are special districts.We know the specifics of the professional services and work products needed to meet your RFP requirements like no other firm.With this level of experience,we are able to increase efficiency, to provide immediate and continued savings,and to minimize disturbances to client operations. Why Grau&Associates: Knowledgeable Audit Team Grau is proud that the personnel we assign to your audit are some of the most seasoned auditors in the field.Our staff performs governmental engagements year round.When not working on your audit,your team is refining their audit approach for next year's audit. Our engagement partners have decades of experience and take a hands-on approach to our assignments,which all ensures a smoother process for you. Servicing your Individual Needs Our clients enjoy personalized service designed to satisfy their unique needs and requirements. Throughout the process of our audit,you will find that we welcome working with you to resolve any issues as swiftly and easily as possible. In addition, due to Grau's very low turnover rate for our industry,you also won't have to worry about retraining your auditors from year to year. Developing Relationships We strive to foster mutually beneficial relationships with our clients. We stay in touch year round, updating,collaborating and assisting you in implementing new legislation,rules and standards that affect your organization.We are also available as a sounding board and assist with technical questions. Maintaining an Impeccable Reputation We have never been involved in any litigation, proceeding or received any disciplinary action. Additionally,we have never been charged with,or convicted of,a public entity crime of any sort.We are financially stable and have never been involved in any bankruptcy proceedings. Complying With Standards Our audit will follow the Auditing Standards of the AICPA, Generally Accepted Government Auditing Standards,issued by the Comptroller General of the United States,and the Rules of the Auditor General of the State of Florida, and any other applicable federal, state and local regulations. We will deliver our reports in accordance with your requirements. This proposal is a firm and irrevocable offer for 90 days.We certify this proposal is made without previous understanding,agreement or connection either with any previous firms or corporations offering a proposal for the same items. We also certify our proposal is in all respects fair,without outside control, collusion, fraud,or otherwise illegal action,and was prepared in good faith.Only the person(s), company or parties interested in the project as principals are named in the proposal.Grau has no existing or potential conflicts, and anticipates no conflicts during the engagement.Our Federal I.D.number is 20-2067322. We would be happy to answer any questions or to provide any additional information.We are genuinely excited about the prospect of serving you and establishing a long-term relationship. Please do not hesitate to call or email either of our Partners,Antonio J.Grau,CPA(tgrau@graucpa.com)or Racquel McIntosh,CPA (rmcintosh@graucpa.com) at 561.994.9299. We thank you for considering our firm's qualifications and experience. Very truly yours, Grau&Associates Antonio J.Grau 2 Firm Qualifications Grau & Associates CERTIFIED PUBLIC ACCOUNTAN I S 3 Grau's Focus and Experience Our Team • (11) 9/11.113111 2D05 illa Employees are CPAS Year founded 2 11 2 Partners Professional Administrative Staff Professionals Services Provided 297 Community Development Districts Served Financial Compliance Auditing Auditing Properly registered and r licensed professional > Accounting Attestation corporation by the state of FLORIDA filli 4 . . Arbitrage Management Services Consulting We are proud Members of ,j,:,,' --' the American Institute of Certified Public Accountants & l the Florida Institute of Certified Public 9 5 Accountants ,�.�o0 Professional Goy Groups dJa External quality review program:consistently receives a pass Internal: ongoing AICPA I FICPA I GFOA I FASD I FGFOA See next page for monitoring to maintain report and certificateNie quality ei, Grau&Associates 4 • 010 FlCI A I C PA Peer Review Program fk+nis insulate el leruied Public h counter., FICPA Pear Ravi.w Program AICPA Peer Review Program Administered in Florida Administered in Florida by The Florida Institute of CPAs by the Florida Institute of CPAs February 20, 2020 Antonio Grau Grau & Associates 951 Yamato Rd Ste 280 Boca Raton, FL 33431-1809 Dear Antonio Grau: It is my pleasure to notify you that on February 20, 2020, the Florida Peer Review Committee accepted the report on the most recent System Review of your firm.The due date for your next review is December 31, 2022.This is the date by which all review documents should be completed and submitted to the administering entity. As you know, the report had a peer review rating of pass. The Committee asked me to convey its congratulations to the firm. Thank you for your cooperation. Sincere) ,t� Peo. kouw C00.404tit Peer Review Team FI CPA Peer Review Committee paul c©ificpa.org 800-342-3197 ext. 251 Florida Institute of CPAs cc: Daniel Hevia, Racquet McIntosh Firm Number: 900004390114 Review Number: 571202 3800 E.spianade Way.Suite 210 Tallahassee FL 3231 1 800.342 3197 in Florida 1 850 224 2727(Fax-850 222 8190 I wwww ricpa aid Grau&Associates 5 rnnru'n rani u me on�rnxrs .(� £ { Firm & Staff Experience \ . Grau & Associates CERTIFIED PUBLIC ACCOUNTANTS 6 Profile Briefs: GRAU AND ASSOCIATES COMMUNITY DEVELOPMENT DISTRICT EXPERIENCE Antonio)GRAU, CPA BY MANAGEMENT COMPANY (Partner) Years Performing Audits:30+ CPE(last 2 years): Government PFM Accounting,Auditing: 12 g 24 hours;Accounting, Auditing and Other: GMS 58 hours 78 Professional Memberships:AICPA, 38 FICPA, FGFOA, GFOA Racquel McIntosh, CPA (Partner) SDS RIZZETTA MERITUS Years Performing 60 47 23 Audits: 14+ CPE(last 2 years): Government Accounting,Auditing: 38 hours;Accounting, Auditing and Other: 56 hours Professional Memberships:AICPA, FICPA, FGFOA, FASD "Here at Grau &Associates,staying up to date with the current technological landscape is one of our top priorities.Not only does it provide a more positive experience for our clients,but it also allows us to perform a more effective and efficient audit. With the every changing technology available and utilized by our clients, we are constantly innovating our audit process." - Tony Grau "Quality audits and exceptional client service are at the heart of every decision we make.Our clients trust us to deliver a quality audit,adhering to high standards and assisting them with improvements for their organization." -Racquel McIntosh ir1 Grau Si Associates YOUR ENGAGEMENT TEAM Grau's client-specific engagement team is meticulously organized in order to meet the unique needs of each client. Constant communication within our solution team allows for continuity of staff and audit team. Grau contracts with an An advisory consultant will outside group of IT be available as a sounding management consultants to board to advise in those assist with matters areas where problems are including,but not limited to; encountered. network and database security,internet security and vulnerability testing. fte � a? de lb Audit Staff The assigned personnel will The Engagement Partner will work closely with the partner participate extensively during and the District to ensure that the various stages of the the financial statements and all engagement and has direct other reports are prepared in responsibility for engagement accordance with professional policy,direction,supervision, standards and firm policy. quality control,security, Responsibilities will include confidentiality of information planning the audit; of the engagement and communicating with the client communication with client and the partners the progress personnel.The engagement of the audit;and partner will also be involved determining that financial directing the development of statements and all reports the overall audit approach issued by the firm are accurate, and plan;performing an complete and are prepared in overriding review of work accordance with professional papers and ascertain client standards and firm policy. satisfaction. Grau&Associates<'FkTtY11f1 1111511,n(1:(�U".• 8 Antonio `Tony ` J. Grau, CPA Partner Contact: tgrauPgraucpa.com I (561) 939-6672 ^` Experience ! For over 30 years,Tony has been providing audit, accounting L. and consulting services to the firm's governmental,non-profit, + -' it employee benefit,overhead and arbitrage clients. He provides j uidance to clients regarding complex accounting�. g g g p issues, a '; internal controls and operations. As a member of the Government Finance Officers Association •' I Special Review Committee, Tony participated in the review process for awarding the GFOA Certificate of Achievement in 14 f)/) ill! k Financial Reporting.Tony was also the review team leader for the Quality Review of the Office of Management Audits of VI / School Board of Miami-Dade County.Tony received the AICPA -, advanced level certificate for governmental single audits. Education University of South Florida(1983) Bachelor of Arts Business Administration Clients Served (partial list) (>300) Various Special Districts, including: Bayside Improvement Community Development District St. Lucie West Services District Dunes Community Development District Ave Maria Stewardship Community District Fishhawk Community Development District(I,II,IV) Rivers Edge II Community Development District Grand Bay at Doral Community Development District Bartram Park Community Development District Heritage Harbor North Community Development District Bay Laurel Center Community Development District Boca Raton Airport Authority Greater Naples Fire Rescue District Key Largo Wastewater Treatment District Lake Worth Drainage District South Indian River Water Control Professional Associations/Memberships American Institute of Certified Public Accountants Florida Government Finance Officers Association Florida Institute of Certified Public Accountants Government Finance Officers Association Member City of Boca Raton Financial Advisory Board Member Professional Education (over the last two years) Course Hours Government Accounting and Auditing 24 Accounting,Auditing and Other 58 Total Hours 82 (includes of 4 hours of Ethics CPE) Grau&Associates 9 Racquel C. McIntosh, CPA Partner 41,18 Contact: rmcintosh@igraucpa.com I (561) 939-6669 Experience Racquel has been providing government audit, accounting and mos advisory services to our clients for over 14 years. She serves as yj! the firm's quality control partner; in this capacity she closely y, fk ( monitors engagement quality ensuring standards are followed 't and maintained throughout the audit. Racquel develops in house training seminars on current government auditing, accounting, and legislative topics and also provides seminars for various government organizations. In addition, she assists clients with implementing new accounting 4 software,legislation,and standards. Education Florida Atlantic University(2004) Master of Accounting Florida Atlantic University(2003) Bachelor of Arts: Finance,Accounting Clients Served (partial list) (>300) Various Special Districts, including: Carlton Lakes Community Development District Westchase Community Development District Golden Lakes Community Development District Monterra Community Development District Rivercrest Community Development District Palm Coast Park Community Development District South Fork III Community Development District Long Leaf Community Development District TPOST Community Development District Watergrass Community Development District East Central Regional Wastewater Treatment Facilities Indian Trail Improvement District Pinellas Park Water Management District Ranger Drainage District South Trail Fire Protection and Rescue Service District Professional Associations/Memberships American Institute of Certified Public Accountants FICPA State&Local Government Committee Florida Institute of Certified Public Accountants FGFOA Palm Beach Chapter Professional Education (over the last two years) Course Hours Government Accounting and Auditing 38 Accounting,Auditing and Other 56 Total Hours 94 (includes of 4 hours of Ethics CPE) Grau&Associates ��„x 10 l k References / Grauu & Associates CERTIFIED PUBLIC ACCOUNTANTS 11 We have included three references of government engagements that require compliance with laws and regulations, follow fund accounting, and have financing requirements, which we believe are similar to the District. Dunes Community Development District Scope of Work Financial audit Engagement Partner Antonio J. Grau Dates Annually since 1998 Client Contact Darrin Mossing, Finance Director 475 W.Town Place, Suite 114 St.Augustine, Florida 32092 904-940-5850 Two Creeks Community Development District Scope of Work Financial audit Engagement Partner Antonio J. Grau Dates Annually since 2007 Client Contact William Rizzetta, President 3434 Colwell Avenue, Suite 200 Tampa, Florida 33614 813-933-5571 journey's End Community Development District Scope of Work Financial audit Engagement Partner Antonio J. Grau Dates Annually since 2004 Client Contact Todd Wodraska,Vice President 2501 A Burns Road Palm Beach Gardens, Florida 33410 561-630-4922 ��j Grau&Associates 12 !�'JJ Specific Audit Approach y ,f�y ��w �? \ � Grau & Associates CERTIFIED PUBLIC ACCOUNTANTS 13 AUDIT APPROACH Grau's Understanding of Work Product/Scope of Services: We recognize the District is an important entity and we are confident our firm is eminently qualified to meet the challenges of this engagement and deliver quality audit services. You would be a valued client of our firm and we pledge to commit all firm resources to provide the level and quality of services(as described below) which not only meet the requirements set forth in the RFP but will exceed those expectations.Grau&Associates fully understands the scope of professional services and work products requested. Our audit will follow the Auditing Standards of the AICPA, Generally Accepted Government Auditing Standards,issued by the Comptroller General of the United States,and the Rules of the Auditor General of the State of Florida and any other applicable Federal,State of Local regulations.We will deliver our reports in accordance with your requirements. Proposed segmentation of the engagement Our approach to the audit engagement is a risk-based approach which integrates the best of traditional auditing techniques and a total systems concept to enable the team to conduct a more efficient and effective audit.The audit will be conducted in three phases,which are as follows: PHASE I: PHASE II: PHASE III: Preliminary Execution of the Completion and Planning Audit Plan Delivery Phase I - Preliminary Planning A thorough understanding of your organization, service objectives and operating environment is essential for the development of an audit plan and for an efficient, cost-effective audit. During this phase, we will meet with appropriate personnel to obtain and document our understanding of your operations and service objectives and, at the same time, give you the opportunity to express your expectations with respect to the services that we will provide. Our work effort will be coordinated so that there will be minimal disruption to your staff. During this phase we will perform the following activities: » Review the regulatory, statutory and compliance requirements.This will include a review of applicable federal and state statutes, resolutions, bond documents, contracts, and other agreements; » Read minutes of meetings; » Review major sources of information such as budgets, organization charts, procedures, manuals,financial systems,and management information systems; » Obtain an understanding of fraud detection and prevention systems; » Obtain and document an understanding of internal control, including knowledge about the design of relevant policies, procedures, and records, and whether they have been placed in operation; » Assess risk and determine what controls we are to rely upon and what tests we are going to perform and perform test of controls; » Develop audit programs to incorporate the consideration of financial statement assertions, specific audit objectives,and appropriate audit procedures to achieve the specified objectives; » Discuss and resolve any accounting, auditing and reporting matters which have been identified. f"' Crau&Associates 14 Phase II -Execution of Audit Plan The audit team will complete a major portion of transaction testing and audit requirements during this phase. The procedures performed during this period will enable us to identify any matter that may impact the completion of our work or require the attention of management. Tasks to be performed in Phase II include,but are not limited to the following: » Apply analytical procedures to further assist in the determination of the nature, timing, and extent of auditing procedures used to obtain evidential matter for specific account balances or classes of transactions; » Perform tests of account balances and transactions through sampling,vouching,confirmation and other analytical procedures;and » Perform tests of compliance. Phase III - Completion and Delivery In this phase of the audit, we will complete the tasks related to year-end balances and financial reporting. All reports will be reviewed with management before issuance, and the partners will be available to meet and discuss our report and address any questions.Tasks to be performed in Phase III include,but are not limited to the following: » Perform final analytical procedures; » Review information and make inquiries for subsequent events;and » Meeting with Management to discuss preparation of draft financial statements and any potential findings or recommendations. You should expect more from your accounting firm than a signature in your annual financial report. Our concept of truly responsive professional service emphasizes taking an active interest in the issues of concern to our clients and serving as an effective resource in dealing with those issues.In following this approach,we not only audit financial information with hindsight but also consider the foresight you apply in managing operations. Application of this approach in developing our management letter is particularly important given the increasing financial pressures and public scrutiny facing today's public officials. We will prepare the management letter at the completion of our final procedures. In preparing this management letter,we will initially review any draft comments or recommendations with management.In addition,we will take necessary steps to ensure that matters are communicated to those charged with governance. In addition to communicating any recommendations,we will also communicate the following,if any: » Significant audit adjustments; » Significant deficiencies or material weaknesses; » Disagreements with management;and » Difficulties encountered in performing the audit. &Associates C � Grau 15 Our findings will contain a statement of condition describing the situation and the area that needs strengthening, what should be corrected and why. Our suggestions will withstand the basic tests of corrective action: Is the recommendation cost effective? Is the recommendation the simplest to effectuate in order to correct a problem? Is the recommendation at the heart of the problem and not just correcting a symptomatic matter? Is the corrective action taking into account why the deficiency occurred? To assure full agreement with facts and circumstances, we will fully discuss each item with Management prior to the final exit conference.This policy means there will be no "surprises" in the management letter and fosters a professional,cooperative atmosphere. Communications We emphasize a continuous,year-round dialogue between the District and our management team.We regularly communicate through personal telephone calls and electronic mail throughout the audit and on a regular basis. Our clients have the ability to transmit information to us on our secure client portal with the ability to assign different staff with separate log on and viewing capability. This further facilitates efficiency as all assigned users receive electronic mail notification as soon as new information has been posted into the portal. Grau&Associates 16 Cost of Services (10 Grau & Associates CERTIFIED PUBLIC ACCOUNTANTS 17 Our proposed all-inclusive fees for the financial audit for the fiscal years ended September 30, 2020-2022 are as follows: Year Ended September 30, Fee 2020 $4,800 2021 $4,900 2022 $5,000 TOTAL(2020-2022) $14.700 The above fees are based on the assumption that the District maintains its current level of operations. Should conditions change or additional Bonds are issued the fees would be adjusted accordingly upon approval from all parties concerned. Grau&Associates 18 Supplemental Information CI Grau & Associates t"1 (t IIIII't) PUBLIC ACCOUNTANTS 19 PARTIAL LIST OF CLIENTS SPECIAL DISTRICTS 9 w C 7 JJJ T I >- Boca Raton Airport Authority ✓ ✓ ✓ 9/30 Captain's Key Dependent District ✓ ✓ 9/30 Central Broward Water Control District ✓ ✓ 9/30 Collier Mosquito Control District ✓ ✓ 9/30 Coquina Water Control District ✓ ✓ 9/30 East Central Regional Wastewater Treatment Facility ✓ ✓ 9/30 Florida Green Finance Authority ✓ 9/30 Greater Boca Raton Beach and Park District ✓ ✓ 9/30 Greater Naples Fire Control and Rescue District ✓ ✓ ✓ 9/30 Green Corridor P.A.C.E. District ✓ ✓ 9/30 Hobe-St. Lucie Conservancy District ✓ ✓ 9/30 Indian River Mosquito Control District ✓ 9/30 Indian Trail Improvement District ✓ ✓ 9/30 Key Largo Waste Water Treatment District ✓ ✓ ✓ ✓ 9/30 Lake Padgett Estates Independent District ✓ ✓ 9/30 Lake Worth Drainage District ✓ ✓ 9/30 Loxahatchee Groves Water Control District ✓ 9/30 Old Plantation Control District ✓ ✓ 9/30 Pal Mar Water Control District ✓ ✓ 9/30 Pinellas Park Water Management District ✓ ✓ 9/30 Pine Tree Water Control District(Broward) ✓ ✓ 9/30 Pinetree Water Control District(Wellington) ✓ 9/30 Ranger Drainage District ✓ ✓ ✓ 9/30 Renaissance Improvement District ✓ ✓ 9/30 San Carlos Park Fire Protection and Rescue Service District ✓ ✓ 9/30 Sanibel Fire and Rescue District ✓ ✓ 9/30 South Central Regional Wastewater Treatment and Disposal Board ✓ ✓ 9/30 South-Dade Venture Development District ✓ ✓ 9/30 South Indian River Water Control District ✓ ✓ ✓ 9/30 South Trail Fire Protection&Rescue District ✓ ✓ 9/30 Spring Lake Improvement District ✓ ✓ 9/30 St. Lucie West Services District ✓ ✓ ✓ 9/30 Sunshine Water Control District ✓ ✓ 9/30 West Villages Improvement District ✓ ✓ 9/30 Various Community Development Districts(297) ✓ ✓ 9/30 TOTAL 332 5 3 327 CepilGrau&Associates 20 ADDITIONAL SERVICES CONSULTING /MANAGEMENT ADVISORY SERVICES Grau & Associates also provide a broad range of other management consulting services. Our expertise has been consistently utilized by Governmental and Non-Profit entities throughout Florida. Examples of engagements performed are as follows: • Accounting systems • Fixed asset records • Development of budgets • Cost reimbursement • Organizational structures • Indirect cost allocation • Financing alternatives • Grant administration and compliance • IT Auditing ARBITRAGE The federal government has imposed complex rules to restrict the use Current of tax-exempt financing. Their principal purpose is to eliminate any 7:1 Arbitrage significant arbitrage incentives in a tax-exempt issue. We have Calculations determined the applicability of these requirements and performed the rebate calculations for more than 150 bond issues, including both fixed and variable rate bonds. We look forward to providing Heritage Bay Community Development District with our resources and experience to accomplish not only those minimum requirements set forth in your Request for Proposal, but to exceed those expectations! For even more information on Grau &Associates please visit us on www.graucpa.com. (;rail, Associates 21 Proposal to Provide Auditing Services Heritage Bay Community Development District For the Fiscal Years Ending September 30, 2020 With an Option for 2 additional annual renewals Submitted by: McDirmit Davis VP 934 North Magnolia Avenue Suite 100 Orlando, Florida 32803 (407) 843-5406 CONTACT: Tamara Campbell, C.P.A. tcampbeWmcdirmitdavis.com www.mcdirmitdavis.com Proposal for Audit Services to Heritage Bay Community Development District Table of Contents Page Letter of Interest 1 Company Background 3 Experience 8 References 11 Service Approach 13 Cost Proposal 15 Letter of Interest 934 North Magnolia Avenue,Suite 100 Orlando,Florida 32803 407-843-5406 www.mcdirmitdavis.com October 9, 2020 Jack Arcurie Heritage Bay Community Development District 10456 Heritage Bay Blvd. Naples, FL 34120 Thank you for the opportunity to submit our qualifications and experience to serve as independent auditors of Heritage Bay Community Development District. The accompanying proposal will provide you detailed information regarding the scope of services to be provided, as well as a profile of the firm, the individuals who will serve you, our qualifications and experience, and representative clients, including specific references. It is our understanding that we will provide the following services: 1. Financial audit of the basic financial statements of Heritage Bay Community Development District for the fiscal year ending September 30, 2020,with the option for two additional annual renewals. 2. We will commit to maintain staff required to conclude the audits within the time constraints indicated in the RFP. 3. The audit will be performed in accordance with generally accepted auditing standards, Governmental Auditing Standards and the Rules of the Auditor General of the State of Florida. We believe we are the best-qualified firm to perform the engagement for the following reasons: o We presently audit over fifty Community Development Districts,fourteen municipalities and one special water district and have an excellent working knowledge of generally accepted accounting principles related to governmental entities. o We assist in the preparation of the financial statements for most of these governmental entities. o We have assisted nine municipalities in receiving the GFOA "Certificate of Achievement for Excellence in Financial Reporting". Most of these municipalities have been receiving the "Certificate of Achievement" between ten and twenty years. Tamara Campbell is active as a national review team member of the GFOA's"Certificate of Achievement for Excellence in Financial Reporting" program. As a review team member, Ms. Campbell reviews and evaluates financial reports submitted by cities and counties to determine whether the financial reports meet the stringent requirements to receive the GFOA'S prestigious award. Participating as a review team member, Ms. Campbell has demonstrated her expertise in governmental accounting and auditing. o We have strong information technology ability and will input the District's general ledger balances into our ProSystem fx Engagement software and perform a virtually"paperless"audit. The District's Financial Statements are linked to the general ledger; therefore, the likelihood of errors on the financial statements is reduced. o We have recent and continuous experience and have devoted a great deal of our continuing education to the governmental auditing and accounting field. Our firm meets the independence and education requirements of the Government Auditing Standards issued by the Comptroller General of the United States. Our firm is independent of Heritage Bay Community Development District as defined by Government Auditing Standards. pn rt;r o We believe in continuing client contact throughout the year, not just during the audit. We encourage on-going client contact by not charging any fee for phone calls. o We are members of the American and Florida Institutes of Certified Public Accountants and an Associate member of the Governmental Finance Officers Association. Our firm is active in governmental organizations throughout Central Florida and serves on governmental committees of the Florida Institute of CPA's. o We are a local firm with personnel committed to quality and professional performance, accustomed to providing a high level of client satisfaction. We believe that our firm is part of a team effort to assist the District in developing the best financial reporting possible. o We have a history of continuity of personnel assigned to the engagement. Our single office firm and low personnel turnover assures uninterrupted services from our partners and staff. We have a staff of 28 people and 8 of those are governmental audit staff. McDirmit Davis, LLC has not colluded with any of the Proposers,and we have not defaulted on any previous contract, and are not in arrears on any previous or existing contract and are properly licensed. Because of our unique qualifications and a philosophy based on complete dedication to client service, we feel confident that we can provide you with responsiveness and a range of experience that will best serve your needs. Ms. Tamara Campbell, partner, is authorized to represent the firm and may be contacted at 934 North Magnolia Avenue, Suite 100, Orlando, Florida 32803, or phone(407) 843-5406. We would consider it a privilege to serve as independent auditors for Heritage Bay Community Development District. Sincerely, McDirmit Davis, LLC (n l Tamara Campbell, C.P.A. Page I 2 Company Background Company Background Description and History of Audit Firm McDirmit Davis, LLC was incorporated in the State of Florida in August 1984 and serves Central Florida from its centrally located office in Orlando, Florida. The partners and managers have over 150 years of combined experience in public accounting, and our firm has grown to be ranked as one of the top 10 accounting firms in Central Florida by the Orlando Business Journal. Our firm now consists of the following staff: Partners 5 Managers 4 Seniors 7 Staff Accountants/Paraprofessionals 7 Support Staff 4 Information Systems Technology Staff 1 28 The total number of governmental audit staff is eight. We are members of the American and Florida Institutes of Certified Public Accountants and an associate member of the Governmental Finance Officers Association. We are also a member of the Governmental Audit Quality Center. Our firm has a wide range of clients providing both goods and services in the Central Florida area. Our practice encompasses auditing, accounting, management advisory and tax services. A list of all governmental clients audited by us for the fiscal years 2015-2019 is as follows: • Over Fifty Community Development Districts • Sun'n Lake of Sebring Improvement District • Homosassa Special Water • City of Winter Springs, Florida* • City of Ocoee, Florida* • City of Longwood, Florida* • City of Lake Mary, Florida* • City of Belle Isle, Florida* • City of Mascotte, Florida f £ a�� ` • City of Tavares, Florida* ' "," � ':,.: • Town of Windermere, Florida '� `" • City of Clermont, Florida* • City of Inverness, Florida* X,i • City of Orange City, Florida* ..• ,, ‘ ` • City of Groveland, Florida k # "r • City of Fruitland Park, Florida • City of Minneola, Florida • City of Umatilla, Florida* • Town of Montverde, Florida City of Oviedo, Florida* • These entities are presently clients of McDirmit Davis, LLC • These entities participate in the Certificate of Achievement for Excellence in Financial Reporting program. Page I 3 Engagement Team The following supervisory people will work on the audit: • Tamara Campbell, C.P.A., engagement partner • js,: • Michelle Sorbello, C.P.A., audit manager • Matthew Lee, C.P.A., audit manager 414'4+rt All of the above people have considerable experience on governmental audit engagements. All supervisory personnel assigned to the audit, are Certified Public Accountants. The engagement partner and audit manager will be assigned to audit on a full-time basis. In addition to the partner and managers, McDirmit Davis will utilize various audit senior and staff members for audit fieldwork. The professional staff of our firm has been conducting governmental audits in the Central Florida area for the past thirty years. We are experienced auditors in a variety of industries and offer experience in auditing federal grants under the Single Audit Act and performing compliance audits of state grants. License to Practice in Florida Our Firm and all key professional staff are properly licensed to practice in the state of Florida. In addition, our Firm and all assigned key personnel are in good standing with the Florida Board of Accountancy. We can provide a copy of actual License, if requested. Independence McDirmit Davis, LLC is independent of the District as defined by auditing standards contained in Government Auditing Standards. Governmental Audit Quality Center McDirmit Davis, LLC is a member of the AICPA's Governmental Audit Quality Center which is dedicated to establishing the highest standards of audit quality in the governmental accounting and audit sector. External Quality Control Review Our Firm understands the importance of developing a formal quality control program, and therefore have been a member of the Private Companies Practice Section of the American Institute of Certified Public Accountants since 1985. Member firms are required to adhere to quality control standards established by the AICPA Quality Control Standards Committee and to submit to peer reviews of the firm's accounting and audit practice. Peer reviews are intensive reviews of a firm's quality control system by an independent CPA firm. Our firm has had seven peer reviews performed by the American Institute of Certified Public Accountants. Each peer review has included a review of a local governmental entity. We received a "pass" opinion on each review, which represents the best opinion that a firm can receive. On our most recent peer review performed in 2017, we received a peer review rating of"pass", which is the highest rating that a firm can receive under the revised peer review standards. We have never been subject to any litigation or disciplinary actions by a client, the State or any professional organization for substandard field work. A copy of our firm's most recent peer review report follows this page. These peer reviews included a review of at least two governmental engagements, and it should be noted that there were no findings as a result of this review. We have never withdrawn from an engagement prior to the agreed expiration date. Page I4 McDirmit Davis Federal or State Reviews Any Federal or State desk review has resulted in no findings and we have never undergone a Federal or State field audit. Other Services Provided Our experience in governmental auditing has led to the development of efficient procedures that provide various client benefits. Our services provide our clients with a wide range of knowledge, confidence, and helpful management advice. Below is a listing of the type of other services that we have provided to governmental clients. 1. Assistance in preparation of Comprehensive Annual Financial Reports for recognition by the Government Finance Officers Certificate of Achievement Program. 2. Internal audit services. 3. Issuance of Comfort Letters and Consent Letters in conjunction with the issuance of tax-exempt bonds. 4. Assistance on early implementation of new GASB Statements. 5. Assisting in compiling historical financial data for first-time submissions for GFOA Certificate of Achievement for Excellence in Financial Reporting. 6. Detailed internal control studies and evaluations of accounting systems. Page 5 (KV Gregory, Sharer & Stuart, P.A. Certified Public Accountants and Business Consultants Report on the Firm's System of Quality Control October 13,2017 To the Owners of McDirmit Davis&Company,LLC And the Peer Review Committee of the Florida Institute of CPAs We have reviewed the system of quality control for the accounting and auditing practice of McDirmit Davis & Company,LLC(the firm)in effect for the year ended June 30,2017.Our peer review was conducted in accordance with the Standards for Performing and Reporting on Peer Reviews established by the Peer Review Board of the American Institute of Certified Public Accountants(Standards). A summary of the nature, objectives, scope, limitations of, and the procedures performed in a System Review as described in the Standards may be found at www.aicpa.org/prsummary. The summary also includes an explanation of how engagements identified as not performed or reported in conformity with applicable professional standards,if any,are evaluated by a peer reviewer to determine a peer review rating. Firm's Responsibility The firm is responsible for designing a system of quality control and complying with it to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. The firm is also responsible for evaluating actions to promptly remediate engagements deemed as not performed or reported in conformity with professional standards, when appropriate, and for remediating weaknesses in its system of quality control,if any. Peer Reviewer's Responsibility Our responsibility is to express an opinion on the design of the system of quality control and the firms compliance therewith based on our review. Required Selections and Considerations Engagements selected for review included engagements performed under Government Auditing Standards including a compliance audit under the Single Audit Act and an audit of employee benefit plans. As a part of our peer review, we considered reviews by regulatory entities as communicated by the firm, if applicable, in determining the nature and extent of our procedures. Opinion In our opinion, the system of quality control for the accounting and auditing practice of McDirmit Davis & Company,LLC in effect for the year ended June 30,2017,has been suitably designed and complied with to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. Firms can receive a rating of pass, pass with defrciency(ies), or fail. McDirmit Davis & Company,LLC has received a peer review ratingg of pass. 741Stts14v.ks Gregory,Sharer&Stuart,P.A. 100 Second Avenue South,Suite 600 I St.Petersburg,Florida 33701-4336 (727)821-6161 I Fax(727)822-4573 I gsscpa.com I info@gsscpa.com Page 16 1 Continuing Education McDirmit Davis, LLC is committed to the personal and professional growth of its staff. Our firm requires an annual minimum of 40 hours of continuing professional education for each staff member. Awe Our governmental audit staff complies with the continuing education requirements 444., of the State of Florida, the Governmental Accountability Office (GAO), and Governmental Auditing Standards (Yellow Book). Therefore at least 24 hours �• during a 2-year period must be in subjects directly related to the government #'. environment and to governmental auditing. Our governmental audit staff always exceed this requirement since they attend each year the Florida Governmental Financial Officer's Association Annual Conference which provides 22 hours of training in governmental accounting and auditing. As a result of our governmental experience,our staff has taught classes or lectured on various topics. We offer"in-house" education courses for our staff, which at times, our clients have attended. In addition,we are available to teach seminars for the benefit of the District's accounting staff. Information Technology Our firm has one dedicated Information Technology specialist who has several years'experience in setting up and administering computer systems and networks of all sizes. In addition, all governmental audit personnel are experienced with various governmental software programs. We utilize automated, paperless auditing software which stores all trial balances and audit workpapers electronically. We also use Data Analysis Software, which enables us to obtain 100%of selected data and test"through your computer system." One of the services we provide our clients is CLIENT PORTAL. This is a convenient online storage space in which files can be effortlessly uploaded, downloaded, stored and shared in a safe and secure environment. Records Retention Our firm maintains records in accordance with local, state, and Federal Public Records Retention Requirements. Page 17 Experience Resume - Tammy Campbell, CPA Partner AOf .� Education,Certifications,and Licenses • B.S. Degree in Accounting, University of Central Florida • Masters in Taxation, University of Central Florida • CPA, Certified Public Accountant- Florida, 2007 Affiliations and Community Involvement • American Institute of Certified Public Accountants (AICPA) • Florida Institute of Certified Public Accountants (FICPA) • Florida Government Finance Officers Association (FGFOA) • Reviewer for GFOA's"Certificate of Achievement for Excellence in Financial Reporting" program • Member of the Orange County School Board Audit Advisory Committee Continuing Professional Education Tammy has completed over 120 hours of Continuing Professional Education (CPE) in the area of governmental accounting and auditing within the past three years and meets the requirements of Governmental Auditing Standards(the "Yellow Book"). CPE included classes on Single Audits, the Yellow Book, and changes in governmental accounting principles, such as GASBS 67 and 68 on pension plans. Experience • Tammy has fifteen (15) years of governmental accounting and auditing experience, including municipalities and airport authorities. • Her experience has included planning, fieldwork, and preparation of comprehensive annual financial reports for several governmental audit engagements. • Tammy has worked with all 14 municipalities in the CAFR preparation process, including assisting most cities with obtaining the GFOA Certificate of Achievement. Governmental Audit Experience (Past 5 years) • Over 60 Community Development Districts • City of Umatilla • Town of Windermere • City of Clermont • City of Longwood • City of Oviedo • City of Belle Isle • City of Lake Mary • City of Winter Springs • City of Ocoee • City of Inverness • City of Tavares • City of Mascotte • City of Orange City • Homosassa Water District Page 18 Resume - Michelle Sorbello, CPA N.:, Audit Manager ' A Education, Certifications,and Licenses • B.S. Degree in Accounting, University of Central Florida • Masters in Accounting, University of Central Florida • CPA, Certified Public Accountant- Florida Ali" Affiliations and Community Involvement • American Institute of Certified Public Accountants (AICPA) • Florida Institute of Certified Public Accountants (FICPA) • Florida Government Finance Officers Association (FGFOA) Continuing Professional Education Michelle has completed over 120 hours of Continuing Professional Education (CPE) in the area of governmental accounting and auditing within the past three years and meets the requirements of Governmental Auditing Standards. Experience • Michelle has 6 years of governmental accounting and auditing experience. • She has significant experience in the audits of governmental and not-for-profit entities, including those subject to Federal and Florida Single Audit requirements. Governmental Audit Experience (Past 5 years) • City of Winter Springs • City of Lake Mary • City of Longwood • City of Ocoee • City of Inverness • City of Mascotte • Various Community Development Districts Page 19 Resume - Matthew Lee, CPA Audit Manager Education, Certifications,and Licenses • Master of Science in Accounting, University of Central Florida • Master of Public Administration, University of Central Florida • B.S. in Public Administration, University of Central Florida • CPA, Certified Public Accountant- Florida Affiliations and Community Involvement • American Institute of Certified Public Accountants (AICPA) • Florida Institute of Certified Public Accountants (FICPA) • Florida Government Finance Officers Association (FGFOA) Continuing Professional Education Matthew has completed over 120 hours of Continuing Professional Education (CPE) in the area of governmental accounting and auditing within the past three years and meets the requirements of Governmental Auditing Standards. Experience • Matthew has 8 years of governmental accounting and auditing experience. • He has significant experience in the audits of governmental and not-for-profit entities, including those subject to Federal and Florida Single Audit requirements. Governmental Audit Experience (Past 5 years) • City of Ocoee • Town of Windermere • City of Clermont • City of Longwood • City of Oviedo • City of Tavares • City of Winter Springs • City of Umatilla • Sun 'N Lake Improvement • City of Belle Isle District • Various Community Development Districts Page 110 References of Governmental Accounting Experience Principal Client Contact Scope of Work Years Sun'n Lake of Sebring Improvement District Ms. Tanya Cannady, General Manager. • Annual Financial & Compliance Audit 2011 to and preparation of Financials Present 5306 Sun'n Lake Blvd. Sebring, FL 33872 tcannady a(..snldistrict.orq Sterling Hill Community Development District Ms. Kaitlyn Gallant • Annual Financial &Compliance Audit 2007 to 2009 Rizzetta and Company and preparation of Financials And 2013 to Manager, District Accounting Services Present 12750 Citrus Park Lane Suite 115 Tampa, Florida 33625 kgallant(c�rizzetta.corn Meadow Pointe ll Community Development District Mr. Alan Baldwin • Annual Financial &Compliance Audit 2012 to Inframark and preparation of Financials Present Accounting Manager 210 N. University Drive Suite 702 Coral Springs, Florida 33071 alan.baldwin(a�inframark.corn Toscana Isles Community Development District Mr. Jeffrey Pinder • Annual Financial&Compliance Audit 2015 to Wrathell Hunt and Associates and preparation of Financials Present Controller 2300 Glades Road Suite 410W Boca Raton, Florida 33431 pinder0 whhassociates.corn Homosassa Special Water District Ms. Teresa Olds, Manager • Annual Financial &Compliance Audit 2007 to and preparation of Financials Present 7922 W. Grover Cleveland Blvd. Homosassa, FL 34448 hswd(@,tampabay.rr.corn Page I11 List of 2019 Community Development District Audits: Asturia Community Development District Bainebridge Community Development District Beach Road Golf Estates Community Development District Belmont Community Development District Bexley Community Development District Celebration Community Development District Chapel Creek Community Development District Concorde Estates Community Development District Copperspring Community Development District Dovera Community Development District Durbin Crossing Community Development District Enterprise Community Development District Fiddler's Creek Community Development District#1 Forest Creek Community Development District Greyhawk Landing Community Development District Heritage Isle at Viera Community Development District Highlands Community Development District K-Bar Ranch Community Development District K-Bar Ranch II Community Development District Meadow Pointe II Community Development District Mediterra Community Development District Mirabella Community Development District Palm River Community Development District Portofino Springs Community Development District Scenic Highway Community Development District South Shore Corporate Park Community Development District Southaven Community Development District Southern Hills Plantation II Community Development District Spring Ridge Community Development District Sterling Hill Community Development District Suncoast Community Development District Talavera Community Development District The Crossings at Fleming Island Community Development District The Woodlands Community Development District Toscana Isles Community Development District Town of Kindred Community Development District Trails Community Development District Treeline Preserve Community Development District Trout Creek Community Development District University Square Community Development District University Village Community Development District Valencia Water Control District Venetian Community Development District Watergrass II Community Development District Waterlefe Community Development District Westridge Community Development District Wiregrass Community Development District Wiregrass II Community Development District Page I12 Service Approach Service Approach Our audit will be segmented as follows: Phase 1: Audit Planning Phase 2: Evaluation and Testing of Internal Controls Phase 3: Substantive Testing Phase 4: Reporting Phase 1: Audit Planning Preliminary planning includes deciding on an overall strategy for the audit, obtaining an understanding of the entity and its environment, including its internal control, making an initial assessment of audit risk and materiality, and deciding on the overall timing of the engagement. We will also begin to assemble our "permanent file,"which consists of copies of organizational charts, District manuals, documents, and financial and other management systems. We will meet with staff of the District to obtain an understanding of the flow of transactions through your accounting system. This includes understanding your computer environment in order to comply with the requirements of AU-C 300,Planning an Audit. We will also gather information to identify fraud risks as required by AU-C 240 Consideration of Fraud in a Financial Statement Audit. We will also perform preliminary analytical procedures and compare trends for the current and at least the two previous years for unusual fluctuations. This will include review of both budget and actual amounts. During this planning phase, we will ask management and staff at the District to identify areas of higher risk as well as other areas that they want us to focus on during our audit. We will also provide the District with a list of all schedules to be prepared by the District. Phase 2: Evaluation and Testing of Internal Controls and Compliance During Phase 2, we will evaluate your control policies and procedures to determine if they are functioning properly in significant transaction classes. To gain an understanding of thei procedures in place, and current internal control structure, we typically LW „ .f conduct interviews with staff and management involved in the specific transaction class to be tested. We then perform tests of these controls to determine with reasonable assurance that control procedures are functioning as planned and whether further testing will be needed. As part of our tests of .._ 1 ,t, - t controls,we will include tests of compliance with applicable ordinances, andor state and federal laws and regulations. In order to determine which Sillir°41.....' ordinances,laws and regulations to test for compliance,we start by reviewing A the FICPA Practice Aid Compliance Auditingin Florida. We then evaluate ,. •, P � � ;• which ordinances, laws and regulations have a direct and material effect on .1' ` .Attoi the determination of financial statement amounts. Sample sizes are determined based upon our assessment of control risk and may be �' judgmental, random, or stratified, depending on the attributes of the population being tested. We will select samples from the significant transaction classes and trace from original documents through the computer system to the general ledger through the use of Data Analysis Software. Page I13 Service Approach-Continued Phase 2: Evaluation and Testing of Internal Controls and Compliance-Continued Our control testing includes obtaining an understanding of the computer software used by the District, and tracing sample selections through the system to determine the desired outcomes are being achieved. Our testing of Information Technology includes inquiries of appropriate personnel regarding data backups and access to District files. After controls have been documented, evaluated and tested, we will finalize the District's audit plan. Audit programs will be tailored to fit the specifics of the District's accounting systems. Phase 3: Substantive Testing Our year-end fieldwork will focus on verifying balances in accounts. For example, we will confirm cash balances, as well as debt balances with financial institutions. In addition to obtaining audit confirmations, representation letters and attorney letters, we will perform tests on account balances using analytical procedures, recalculation and verification. Our firm uses ProSystem fx Engagement electronic audit software which may allow us to interface with your accounting system and reduce the time required to transfer your accounting data to a separate software package. We believe it is important to use analytical review procedures in this substantive phase of the audit. We compare analytical results to our expectation of what the results should be in order to determine if additional audit procedures are required. Typical analytical procedures include expense variances with previous years and budget amounts, revenue variances with previous years and budgeted amounts. We will keep the District's management up to date on the progress of the audit and will discuss preliminary findings and potential problems or opportunities as we encounter them. Our approach to resolving problems encountered is to discuss with the District Manager to make sure our understanding is correct. Our process to produce a meaningful "management letter" is to review results of testing of internal controls, as well as year- end field work and draft recommendations for improvements to be discussed with management. Phase 4: Reporting The audit work is reviewed by the engagement partner throughout the engagement. Once the engagement partner review is complete, a second review of the financial statements is performed by the independent reviewer. This second review is required as part of McDirmit Davis's internal system of quality control and ensures the District receives the best service possible. We will prepare a draft of the financial statements and then issue the following: • Auditor's report on financial statements • Report on internal control over financial reporting and on compliance and other matters based on an audit of financial statements performed in accordance with"Government Auditing Standards" • Management Letter We will provide technical assistance to the District to meet changes in required disclosures. Once reports have been reviewed by management and approved in final form,we will issue final reports and supply in electronic format. Page 114 Cost Proposal ramilmml McDirmit Davis LJ Cost Proposal We understand the requested services include audits of the District's financial statements for the years ended September 30, 2020, with the option for two additional annual renewals. The audit will be made in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. McDirmit Davis, LLC is duly licensed under Chapter 473, Florida Statutes and is qualified to conduct audits in the State of Florida and audits in accordance with Government Auditing Standards. Fees include all services, including but not limited to, meals and lodging, transportation, printing and binding, telephone,fax and copies. Out of pocket expense (if any) related to charges for confirmations will be in addition to the audit fee. Invoices will be submitted as work progresses on each phase of the audit. Year Ended Audit Fee- September 30, 2020 $3,500 September 30, 2021 $3,600 September 30, 2022 $3,600 Page I15 Berger, Carr Rigs Toombs, Frank and &Ingram Gaines,& McDirmit Gras& Heritage Bay CDD 10-22-20 Frank Davis Associates Audit RFP Point Totals Supervisor Arcurie Ability of Proposer's Understandi Ability to Furnish the Audit Firm Personnel Experience ng Scope of Required Services Price(20 Points) Totals (20 Points) (20 Points) RFP (20 Points) (100 Points) (20 Points) Carr Rigs&Ingram 20 20 20.00 20.00 6.00 86 86 Berger,Toombs,Gaines,& Frank 18 20 20 20 11 89 89 Frank and McDirmit Davis 98 98 18 20 20 20 20 Grau&Associates 20 20 20 20 13 93 93 Supervisor Gagne Ability of Proposer's Understandi Ability to Furnish the Audit Firm Personnel Experience ng Scope of Required Services Price(20 Points) Totals (20 Points) (20 Points) RFP (20 Points) (100 Points) (20 Points) Carr Rigs&Ingram 17 19 20.00 20.00 10.00 86 86 Berger,Toombs,Gaines,& 81 81 Frank 14 17 18 18 14 Frank and McDirmit Davis 18 19 20 19 20 96 96 Grau&Associates 18 18 20 19 17 92 92 Supervisor Hunter Ability of Proposer's Understandi Ability to Furnish the Totals Audit Firm Personnel Experience ng Scope of Required Services Price(20 Points) (20 Points) (20 Points) RFP (20 Points) (100 Points) (20 Points) Carr Rigs&Ingram 20 17 20.00 18.00 15.00 90 90 Berger,Toombs,Gaines,& 90 90 Frank 18 18 20 15 19 Frank and McDirmit Davis 18 18 20 20 18 94 94 Grau&Associates 20 20 20 18 20 98 98 Supervisor Soucie Ability of Proposer's Understandi Ability to Furnish the Audit Firm Personnel Experience ng Scope of Required Services Price(20 Points) Totals (20 Points) (20 Points) RFP (20 Points) (100 Points) (20 Points) Carr Rigs&Ingram 20 10 20.00 5.00 5.00 60 60 Berger,Toombs,Gaines,& 85 85 Frank 20 15 20 20 10 Frank and McDirmit Davis 20 10 20 10 20 80 80 Grau&Associates 20 20 20 15 15 90 90 Point Totals 322 345 368 373