CCR1995223COMMON COUNCIL
RESOLUT ION #223-95
- CITY OF MUSKEG0
APPROVAL OF AGREEMENT BETWEEN
THE CITY AND CONLEY MCDONALD
FOR AUDIT SERVICE OF GENERAL FUND AND
FOR YEAR ENDING 12/31/95
SEWER AND WATER UTILITIES
WHEREAS, it is necessary for the City of Muskego to enter into
an agreement to cover procedures to be used in the auditing of
the City's General Fund and Sewer and Water Utilities; and
WHEREAS, the firm Conley McDonald has audited the City's books
for over twenty years, and
WHEREAS, the Finance Committee has recommended approval of an
agreement between the City and the firm.
NOW, THEREFORE, BE IT RESOLVED that the Common Council Of the
City of Muskego, upon the recommendation of the Finance
Committee, does hereby authorize the Mayor and Clerk to execute
an agreement between the City of Muskego and the firm of Conley
McDonald to audit the City's General Fund and Sewer and Water
Utilities for the year ending December 31, 1995.
BE IT FURTHER RESOLVED that said agreement is subject to the
approval of the City Attorney.
DATED THIS 28TH DAY OF NOVEMBER , 1995.
SPONSORED BY:
FINANCE COMMITTEE
Ald. Domonic D'Acquisto
Ald. Patrick A. Patterson
Ald. David J. Sanders
This is to certify that this is a true and accurate copy of
Resolution #223-95 which was adopted by the Common Council of the
City of Muskego.
e 11/95 jmb
CERTlFlED PUBLIC ACCOUKIANTS&COSSULTAW
November 2, 1995
Mr, David L. DeAngelis, Mayor
City of Muskego
W182 S8200 Racine Avenue
Muskego, WI 53150
Dear Mr. DeAngelis:
We are pleased to serve as independent accountants for the City of Muskego. This will confii
our understanding of the arrangements for our audit of the general purpose financial statements
for the year ending December 31, 1995.
Our basic engagement is to audit and report on the general purpose financial statements of the
following funds and account groups:
Governmental Fund Types:
General Fund
Debt Service Fund
Special Revenue Fund
Capital Projects Fund
Proprietary Funds:
Water Utility
Sewer Utility
Fiduciary Funds - Trust and Agency
Account Groups:
General Long-Tern Obligations
General Fixed Assets
Our audit will be conducted in accordance with generally accepted auditing standards and will
include our examining, on a test basis, evidence supporting the amount and disclosures in the
financial statements, assessing the accounting principles used and significant estimates made by
management, as well as evaluatin? the overall financial statement presentation.
19601 West Bluemound Road. Suite 3
Brooktield, WI 53045-5974
Phone (414) 796-0701 FAX (414) 796-8422
City of Muskego
Page Two
November 2, 1995
The objective of our engagement is the completion of the foregoing audit and, upon its completion
and subject to its findings, the rendering of our report. As you know, the fmncial statements
are the responsibility of the management and the Common Council of the City of Muskego who
are primarily responsible for the data and information set forth therein, as well as for the
maintenance of an appropriate internal control stmcture (which includes adequate accounting
records and procedures to safeguard the City’s assets). Accordingly, as required by generally
accepted auditing standards, our procedures will include obtaining Written confiiation from
management concerning important representations which we will rely upon.
As also required by generally accepted auditing standards, we will plan and perform our audit
to obtain reasonable, but not absolute, assurance about whether the financial statements are free
of material misstatement. Accordingly any such audit is not a guarantee of the accuracy of the
fmancial statements and is subject to the inherent risk that errors, irregularities (or illegal acts),
if they exist, might not be detected. If we become aware of any such matters during the course
of our audit, we will bring them to your attention. Should you then wish us to expand our normal
auditing procedures, we would be pleased to work with you to develop a separate engagement
for that purpose.
Preliminary field work is tentatively scheduled for December 1995. Final field work is tentatively
scheduled to begin in April 1996. The audit report will be submitted prior to May 31, 1996.
Assistance to be supplied by your personnel, including the preparation of schedules and analysis
of accounts will be discussed and coordinated with the City Clerk. Timely completion of this work
will facilitate achieving the best audit performance with the minimum time.
We will assist in the preparation of the Financial Report Form for Wisconsin Cities and Villages
IO be filed with the Wisconsin Department of Revenue. This report is considered a special report
and therefore, is not to be considered as audited by us. The report will be completed prior to the
extended due date of May 15, 1996. It will, however, be your responsibility to obtain a filing
extension (which is automatic upon request) from the Wisconsin Department of Revenue from the
original due date of May 1 to the extended due date of May 15. This report requires many
allocations of expenses beyond which is recorded on the City’s records. It will be necessary that
these allocations be reviewed annually by the City. Determination of these allocations by the
City will facilitate the report preparation in minimum time.
The City is required by Wisconsin statutes to make available to the public updated annual reports
describing the status of each existing tax increment fmancing district. We will examine the
fmancial statements of the City’s Tax Increment District Funds for the year ended December 31,
1995, and issue a separate report thereon before September 30, 1996.
Page Three City of Muskego
November 2, 1995
Below we have provided you with our estimated fees for auditing, bookkeeping and the prepara-
tion of the financial report filed with the Wisconsin Department of Revenue for 1996 with a
comparison to the actual fees charged in 1993, 1994 and 1995.
AUDIT and BOOKKEEPING FEES
Actual Actual Actual Estimated
City and Utilities 1993 1994 1995 1996
General Fund and all other funds
exclusive of funds detailed below $ 22,523 23,300 24,100 24,900
Water Utility 6,760 7,000 7,250 7,500
Sewer Utility 6,760 7,000 7,250 7,500
Preparation of Financial Report fded
with the Wisconsin Department of
Revenue 2.700 2.800 2,900 - 3 .OOO
Subtotal 38,743 40,100 41,500 42,900
TIF Funds 23.925 24.775 25.650 26.550
(Note)
TOTAL $ 62.668 64.875 67.150 69.450
Percentage Increase (Decrease) 3.5% - 315% - 3.43%
Note: 1995 fees for the TIF Fund audit are
estimated as work is not yet complete.
In connection with developing our 1996 fee estimate, we have included an inflationary factor
of 3.43%, We have also projected that the City will utilize the same level of bookkeeping and
accounting services from our fm during the audit process as was required in the prior year
City of Muskego
Page Four
November 2. 1995
Should the time recluirements of our staff be reduced because of significant imurovements in the
accounting and recordkeeuing functions. we will. of course. bill the lesser amounts as we have done
in urior years.
The 1996 fee estimates summarized above do not include services for budget assistance, sewer
rate consultation, water rate studies, other special studies or accounting and bookkeeping
consultation which occurs outside of the audit process.
Our fees are based on the time required of the individual's assigned to the engagement plus direct
expenses for reproducing the year-end audit reports. Individual'hourly rates vary according to the
degree of responsibility involved and the skill required. Our hourly rates for 1995 and 1996 are
shown below,
1995
Partner
Tax Manager
Audit Manager
Audit Supervisor
In-Charge Accountant
Associate Accountants
Partner
Tax Manager
Audit Manager
Audit Supervisor
In-Charge Accountant
Associate Accountants
Rates for
Audit Services
$ 116.00
Not Applicable
86.00
68.00
54.00
36.00 to 45.00
Rates for
Management Advisory
Services
$ 145.00
125.00
108.00
85.00
67.00
45.00 to 57.00
1996
Rates for
Audit Services
$ 120.00
Not Applicable
90.00
70.00
56.00
37.00 to 47.00
Rates for
Management Advisory
Services
$ 150.00
129.00
112.00
88.00
69.00
46.00 to 59.00 e
City of Muskego
Page Five
November 2, 1995
I will be the partner in charge of all work we will perform for you. It will be my responsibility to
insure that your management receives good services. I will call upon other partners in the firm
for a second point of view or a specialized knowledge as necessary
The audit this year will be supervised by Mr. Callen Strunk, CPA, Audit Manager, assisted by
other members of the staff as necessary.
We look forward to our association with you and your staff and appreciate the opportunity to
serve the City of Muskego. Please call if you have any questions about any aspect of our engage-
ment.
If this letter correctly expresses your understanding of the agreement, please sign the enclosed
copy where indicated and return it to us.
Very truly yours,
CONLEY McDONALD,& CO.
Donald N. Vilione, CPA
Partner
DXV/dlw:rneng
The foregoing letter fully describes the services required and is accepted by us.
CITY OF MUSKEGO
Date David L. DeAngelis, Mayor