25D - AGMT - FINANCIAL AUDIT SRVS

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f i SECTION 4: SPECIFIC AUDIT APPROACH AND METHODOLOGY. • Single Audit; We will perform a Single Audit in accordance with the federal Single Audit Act Amendments of 1996; U.S. Office of Management and Budget (OMB) Circular A-133, Audits of States, Local Governments and Non-Profit Organizations and the OMB Circular A-133 Compliance Supplement. The schedule of expenditures of federal awards with accompanying notes, schedule of findings and questioned costs and the following reports will be issued separate from the City's basic financial statements. • Report on Compliance with Requirements Applicable to Each Major Program, Internal Control Over Compliance and Schedule of Expenditures of Federal Awards in Accordance with OMB CircularA-133 • Report in Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements in Accordance with Government Auditing Standards. We understand that the City will provide MGO with the schedule of expenditures of federal awards while we will take responsibility over the with accompanying notes and schedule of findings and questioned costs. Additionally, MGO will also complete and submit the online Data Collection Form and electronic submission to the Federal Audit Clearinghouse. MGO will provide the City with a final print and electronic copy of the Data Collection Form that was electronically submitted. • Management Letters: We issue management letters every year in connection with nearly all of our governmental clients. Unless there are unusual circumstances, the management letters are issued at the conclusion of the audit concurrent with the issuance of the audited financial statements. Our management letters contain observations and recommendations that are meaningful to our clients. They are intended to be constructive and are in fact viewed in a very positive manner by our clients. Management letters are always reviewed In draft form with appropriate client personnel before they are issued. Annual Audit of the Successor Community Redevelopment Agency of the City of Santa Ana Financial Statements: There are many uncertainties surrounding the financial reporting requirements of the dissolved Redevelopment Agencies. However; we stand ready to perform an audit of the Successor Community Redevelopment Agency and Housing Successor Agency at the City's request, in accordance with all applicable auditing standards and with the objective of expressing an opinion on the financial statements. We will perform an audit of the Citys Redevelopment Agency's basic financial statements and each major fund in accordance with all applicable auditing standards with the objective of expressing an opinion on the financial statements. If requested, we will provide the City with a complete draft of the Successor Community Redevelopment Agency and Housing Successor Agency Financial Statements, including footnotes and any required supplementary schedules by November 1 of each year, • Santa Ana Housing Authority: We will perform the financial and compliance audit for the Housing authority and prepare and submit HUD an electronic REAC submission for the City's Section 8 Program. At the City's request, we will conduct fieldwork for the Successor Community Redevelopment Agency, Housing Successor Agency and Housing Authority during the same time • GANN: We will perform agreed-upon procedures in connection with the annual calculation of the appropriations limit as required by Section 1.5 of Article XIIIB of the California Constitution. MGO will provide the City with a draft of the GANN limit letter no later than November 1, annually. • Annual Review of the City's Investment Policy: We will perform various procedures agreed to by the City Council and the City Management solely to assist the City in determining whether the City's investment activities are in compliance with the City's investment policy and the California Government Code. Agreed-upon procedures will be performed in accordance with attestation standards established by the American Institute of Certified Public Accountants. We understand that we will provide the City a separate report on such compliance and, if applicable, recommend changes in the Investment Policy document relating to cash and investments for many governmental entities in order to verify compliance with established policies and procedures and to enhance internal controls In conformity with the City's required scope of work, MGO will issue the necessary annual audit report for the purpose of determining compliance with applicable State and Federal Laws. • Required Communication: We will present matters or topics which may be of interest to the accounting and financial reporting personnel of the City related to government auditing and accounting. Topics that may be covered include updates on generally accepted accounting principles (GAAP), generally accepted auditing standards (GAAS), OMB Circular revisions, recent GASB pronouncements, changes in business trends relating to the City and other authoritative procedures. We will also provide information encompassing GAAP and GAAS related topics. Professional standards require us to communicate any instances of irregularities and illegal acts or 24 25Q-14