Backup Documents 03/26/2013 Item #10E10E
MEMORANDUM
Date: June 4, 2013
To: Derek Johnssen, Assistant Finance Director
Clerk of Courts Finance Department
From: Ann Jennejohn, Deputy Clerk
Minutes & Records Department
Re: Ernst & Young Contract #09 -5270
Auditing Services for Collier County
"Exhibit A -5 Contract Amendment"
Attached for your records is a copy of the document referenced above, per direction
given by the Board of County Commissioners during the meeting held March 12, 2013,
(Item #13A) and subsequently brought forth in the Executive Summary (Item #10E) at
the following meeting held Tuesday, March 26, 2013.
The original will be held on file in the Minutes and Record's Department in the
Board's Official Records.
If you have any questions, please feel free to contact me at 252 -8406.
Thank you.
Attachment
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3/26/201310. E.
EXECUTIVE SUMMARY
Recommendation that the Board of County Commissioners direct stab' to solicit proposals
to develop and implement targeted improvements to the County's federal and state grants
compliance and administration systems. The solicitation should be directed to public
accounting firms with known expertise in grants compliance accounting and auditing,
including but not limited to the Big 4 firms. Responses by bidders shall give. consideration
to the recommendations for improvements to the existing grant processes and systems as
will be provided by the County's auditors, Ernst & Young. The request for proposals
(RFP) shall be developed and released within 60 .days of receipt of the Ernst & Young
assessment report.
OBJECTIVE: That the Board of County Commissioners direct staff to solicit proposals to
develop and implement targeted improvements to the County's federal, and state grants
compliance and administration systems. The solicitation should be directed to.public accounting
firms with known expertise in grants compliance accounting and auditing; including but not
limited to the Big 4 firms. Responses by bidders shall give consideration to the
recommendations for improvements to the existing grant processes and systems as will be
provided by the County's auditors, Ernst & Young. The request for proposals (RFP) shall be
developed and released within 60 days of receipt of the Ernst & Young assessment report.
CONSIDERATIONS: During E&Y's presentation of the CAFR to the Board of County
Commissioners, there was discussion of weaknesses in the grants compliance arena MY
acknowledged the benefits of the recommendation to purchase a federal and state grants
compliance and administration systems template, pointing out that the benefits would outweigh
the cost. This template would prescribe best practice financial and accounting systems, business
processes and external technical training and assistance resources needed to achieve desired
outcomes and accountability. As such, it-behooves the Board to evaluate purchase of such a
system. There are a number of well developed programs available that once implemented will
allow the county to focus on optimizing its grants program for the benefit of the community.
FISCAL EWPACT: To be determined by staff.
LEGAL CONSIDERATIONS: This item has been reviewed by the County Attorney, raises no
legal issues at this time, and requires majority vote for Board direction. -SAK
RECOMMENDATION: That the Board of County Commissioners direct staff to solicit
proposals to develop and implement targeted improvements to the County's federal and state
grants compliance and administration systems. The solicitation should be directed to public
accounting firms with known expertise in grants compliance accounting and auditing, including
but not limited to the Big 4 firms. Responses by bidders shall give consideration to the
recommendations for improvements to the existing grant processes and systems as will. be
provided by the County's auditors, Ernst & Young. The request for proposals (RFP) shall be
developed and released within 60 days of receipt of the Ernst & Young assessment report.
Packet Page -82-
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3/26/2013 10.E.
March 12, 2013
CHAIRWOMAN HILLER: Very positive.
MR DeSANTO: Yes.
CHAIRWOMAN HILLER: Thank you.
MR. DeSANTO: All right, thank you. Appreciate your time
this morning.
COMMISSIONER HENNING: Madam Chair, I make a
motion that we accept the CAFR --
CHAIRWOMAN HILLER: Thank you.
COMMISSIONER HENNING: -- Comprehensive --
CHAIRWOMAN HILLER: May I have the second?
COMMISSIONER HENNING: -- Annual Financial Report
and file the report with the State of Florida Annual Local
Government Financial reporting, Department of Finance and
Service (sic).
CHAIRWOMAN HILLER: Thank you.
COMIVIISSIONER FIALA: Second.
CHAIRWOMAN HILLER: Thank you very much. And we
have a motion and a second.
There being no further discussion, all in favor?
COMMISSIONER FIALA: Aye.
COMIVIISSIONER HENNING: Aye.
CHAIRWOMAN HILLER: Aye.
COMIVIISSIONER COYLE: Aye.
COMIVIISSIONER NANCE: Aye.
CHAIRWOMAN HILLER: Motion carries unanimously.
And we've by agreement given the County Manager direction to
move forward to work with the amendment of the scope of
services to be provided by Ernst and Young, and I'll bring
forward an executive summary when they pull that all together
for an RFP on assistance with the grant program.
Excerpt Item #13A — Page 15
Packet Page -99-
EXHIBIT A -5 Contract Amendment to Agreement #09 -5270 10 E
"Auditing Services for Collier County"
This Amendment, dated M Ou cPQ, , 2013 to the above - referenced Agreement shall be by and between the
parties to the original AgreemenijEmsf & Young, LLP (to be referred to as "Auditor ") and Collier County, Florida, (to be
referred to as "County ").
Statement of Understanding
RE: Agreement # 09 -5270 - "Auditing Services for Collier County"
In order to continue the services provided for in Agreement # 09 -5270, the Auditor agrees to amend and extend the
Agreement pursuant to Exhibit "A5 -A," including the attached Statement of Work, which is incorporated herein by
reference. Changes to contract:
In accordance with Section 4 of the above referenced contract, add "Grant process advisory services and best practice
recommendations" as provided for in the attached Statement of Work, Exhibit A5 -A in an amount Not To Exceed One
Hundred Thousand Dollars ($100,000.00).
All other terms and conditions of the Agreement shall remain in force.
IN WITNESS WHEREOF, the Auditor and the County have each, respectively, by an authorized person or agent,
hereunder set their hands and seals on the date(s) indicated below.
Accepted: rn , 2013.
AUDITOR:
Ernst & Young, LLP
By: - AP-0alL
John DiSa to, Executive Director
Approved as to Form and
Le ty:
Scott R. Teach, Deputy County A ey
G
OWNER:
BOARD OF COUNTY COMMISSIONERS
COLLIER COUNTY, FLORIDA
ATE FINANCIAL
GEMENT SERVICES
LOIN
Isackson
COUNTY MANAGER
By: - C
Leo Ochs
DIRECTOR OF PURCHASING AND GENERAL SERVICES
By.
Joan Markie icz
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Exhibit A5 -A to Amendment 5 to Contract 09 -5270 Auditing Services for Collier County
Statement of Work
This Statement of Work (this "SOW "), is made by Ernst & Young LLP ( "we" or "EY" or "Auditor ") and
Collier County ( "you" or "County "), pursuant to Contract #09 -5270 ("Agreement"), between EY and the
County of Collier.
Except as otherwise set forth in this SOW, this SOW incorporates by reference, and is deemed to be a
part of, the Agreement. The additional terms and conditions of this SOW shall apply only to the advisory
Services covered by this SOW and not to Services covered by any other Statement of Work pursuant to
the Agreement. Capitalized terms used, but not otherwise defined, in this SOW shall have the meanings
in the Agreement, and references in the Agreement to "you" or "County" shall be deemed references to
you.
Scope of Services
A summary of EY's services are as follows:
Phase 1: Current County Grant Process Assessment
Operational Assessment: The efficiency and effectiveness of contract and grant operations as relates to
process, governance, monitoring and reporting. This scope of work entails conducting an analysis of the
processes noted below and includes:
a. Current business process models and requirements at the functional level for those activities
involved in the key functional areas.
b. Process flows and other visual representations as needed.
c. Baseline performance metrics of the existing processes.
The sub - processes included in the assessment of the contracts and grants process are:
• Account Setup: establishing the fund and budget in the accounting system within the Post -
Award function once the grant has been awarded to the institution.
• Time & Effort Reporting_ capturing the amount of time personnel commit to each grant and the
certification by those personnel that the percent of time and effort is correct. In addition, time
and effort certifications are also required as evidence of meeting cost sharing requirements when
the County has agreed to contribute all or a portion of an employee's salary to a sponsored
project.
• Purchasing: requisitioning goods or services, completing the required quote/bid process,
selecting a vendor, and placing the order for the request.
• Account Mana ement: periodic account maintenance as defined by the sponsor, OMB Circulars,
and county- specific requirements.
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Billing & Drawdown: the method by which the county requests payments from the sponsor
according to the contract or grant through a drawdown, advance, cost reimbursement, or flat
invoice.
Reporting: submitting information required by the sponsor, whether it is a federal, state, local, or
private institution including programmatic reports, fiscal reports and equipment reports.
Account Closeout: all procedures necessary to close the contract or grant upon completion of
project activities including sponsoring agency requirements, SAP responsibilities, payment of
final invoice, submission of final report, and inactivation of the grant fund in the accounting
system.
We will validate findings and develop recommendations for improvement. These will include:
a. Future county business process models and requirements at the functional level
b. Proposed workflow diagrams, process flows and other visual as needed.
C. Identification of opportunities for process improvement in relevant business areas including
cross - functional process efficiencies.
We will provide you with periodic progress updates and, at your request, meet with you periodically to
review our results.
We will prepare the following written Report':
• Findings and Recommendation Report
Limitations on scope
We will not identify, address or correct any errors or defects in your computer systems, other devices or
components thereof ( "Systems "), whether or not due to imprecise or ambiguous entry, storage,
interpretation or processing or reporting of data. We will not be responsible for any defect or problem
arising out of or related to data processing in any Systems.
Your specific obligations
In compliance with Florida Public Records Act, Chapter 119, Fla. Stat., and the Florida Sunshine Law,
Chapter 286, Fla. Stat.,you will not, and you will not permit others to, quote or refer to the Reports, any
portion, summary or abstract thereof, or to EY or any other EY Firm, in any document filed or
distributed in connection with (i) a purchase or sale of securities to which the United States or state
securities laws ( "Securities Laws ") are applicable, or (ii) periodic reporting obligations under Securities
Laws. You will not contend that any provisions of Securities Laws could invalidate any provision of this
Agreement.
"Reports" is defined in the General Terms and Conditions as including all information, advice, recommendations or other
content of any reports, presentations or other communications we provide to you.
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Specific additional terms and conditions
The Services are advisory in nature. EY will not render an assurance report or opinion under the
Agreement, nor will the Services constitute an audit, review, examination, or other form of attestation as
those terms are defined by the American Institute of Certified Public Accountants. None of the Services
or any Reports will constitute any legal opinion or advice. We will not conduct a review to detect fraud
or illegal acts.
Notwithstanding anything to the contrary in the Agreement or this SOW, we do not assume any
responsibility for any third -party products, programs or services, their performance or compliance with
your specifications or otherwise.
We will_ base any comments or recommendations as to the functional or technical capabilities of any
products in use or being considered by you solely on information provided by your vendors, directly or
through you. We are not responsible for the completeness or accuracy of any such information or for
confirming any of it.
Where our written consent under the Agreement is required for you to disclose to a third party any of our
Reports (other than Tax Advice), we will also require that third party to execute a letter substantially in
the form of Appendix A to this SOW.
You shall not, while we are performing the Services hereunder and for a period of twelve (12) months
after they are completed, solicit for employment, or hire, any EY personnel involved in the performance
of the Services, provided, that you may generally advertise available positions and hire EY personnel
who either respond to such advertisements or who come to you on their own initiative without direct or
indirect encouragement from you.
Timetable
Unless otherwise agreed upon in writing by the parties, we anticipate Phase 1 of our services to be
substantially completed by June 30, 2013.
E & Y staff will meet with County appointed staff three (3) times during the period of the engagement.
The first meeting will be prior to beginning the engagement to discuss specific plans, staffing, and
expected time - lines.
A second briefing will be held one -half (1/2) way through the engagement to discuss progress, scope
management and cost reviews.
A final meeting will be at the end of the engagement to discuss deliverables.
Contacts
You have identified Mark Isackson as your contact with whom we should communicate about these
Services. Your contact at EY for these Services will be AJ Desai.
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Fees
Fees for Phase 1 are not to exceed one hundred thousand dollars ($100,000), and will be billed in
accordance with the following hourly rates as per Exhibit B of Contract 09 -5270:
Level
Partner
$
395
Senior Manager
$
280
Manager
$
225
Senior
$
165
Staff
$
125