FRESNO COUNTY EMPLOYEES’ RETIREMENT ASSOCIATION BOARD OF RETIREMENT Steven J. Jolly, Chair Dr. Rod Coburn, III, Vice Chair Laura P. Basua Greg Baxter Alan Cade, Jr. Vicki Crow Robert Dowell Eulalio Gomez Donald C. Kendig, CPA Mary Ann Rogozinski, Alternate Retirement Administrator DATE:    April 20, 2016    TO:    Board of Retirement          FROM:   Donald C. Kendig, CPA,      Retirement Administrator    STAFF CONTACT:  Becky Van Wyk, Assistant Retirement Administrator      SUBJECT:  Contract ‐ Professional Audit Services – Brown Armstrong Accountancy  Corporation – RECEIVE AND FILE; APPROPRIATE ACTION    Background and Discussion  At the March 2, 2016 regular Board meeting, the Board approved the Audit Committee’s  recommendation to award Brown Armstrong the contract for Professional Audit Services for  the fiscal years ended June 30, 2016, 2017 and 2018, pending successful contract negotiations.    I am pleased to announce that contract negotiations were successful and that the contract has  been approved by Rosalva Flores, Partner, with Brown Armstrong.  The contract has been  reviewed by the Board’s general counsel Baker Manock & Jensen, PC.    Fiscal and Financial Impacts   The cost of the services for each of the three years is defined in Exhibit C of the contract,  referred to as the Fee Schedule.  Each year has a maximum price as follows:  $67,800 for 2016,  $69,000 for 2017 and $70,200 for 2018.  Rates for services outside the scope of this contract  are also defined in the Fee Schedule.      Recommended Action  1. Approve the contract with Brown Armstrong Accountancy Corporation and direct the  Chair to sign as representative of the Board.     Attachments    1. Final Contract – Auditing Services Agreement  2. Final Request for Proposal for Professional Audit Services   3. Technical Proposal Response for Professional Audit Services     1111 H Street, Fresno, CA 93721, Tel 559.457.0681 Fax 559.457.0318 r~ ~. - - THIS AUDITING SERVICES AGREEMENT (this "Agreement") is made and entered into as of ~~ , 2016 (the "Effective Date"), by and between the FRESNO COUNTY EMPLOYEES' RETIREMENT ASSOCIATION {hereinafter "FCERA") and BROWN ARMSTRONG ACCOUNTANCY CORPORATION (hereinafter "AUDITOR"). WHEREAS, FCERA was created pursuant to the County Employees Retirement Law of 1937 and is administered by the Board of Trustees (hereinafter referred to as the "BOARD"); WHEREAS, pursuant to Government Code § 31593, "The retirement board shall conduct an audit of the retirement system at least once every 72 months and reporf upon its financial condition. The retirement board may retain the services of a certified public accountant to perform the annual audit. That audit shall be performed in accordance with generally accepted auditing standards. .The audit report shall address the financial condition of the retirement system, internal auditing controls, and compliance with applicable laws and regulations."; and WHEREAS, AUDITOR and assigned personnel satisfy fihe "certified public accountant" criterion and are qualified to perform an audit in accordance with the GARS as set forth by the AICPA, and with the "Minimum Audit Requirements and Reporting Guidelines for California Public Retirement Systems," issued by the California State Controller; and WHEREAS, the BOARD has determined that it would be in the best interest of FCERA if the AUDITOR were to be retained to provide the accounting services set forth below and, accordingly, has voted to authorize the Retirement Administrator to develop terms for an Agreement on their behalf; NOW, THEREFORE, in consideration of the above-stated premises, the terms, covenants and conditions hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree as follows: 1. DESCRIPTION OF AUDITING SERVICES. The BOARD hereby delegates to the AUDITOR the duties and the AUDITOR hereby accepts and assumes 1798705v1l19704.0001 1 responsibility to provide the auditing services identified in Exhibit "A" (attached hereto and referred to herein as the "Auditing Services") and as more generally described in Exhibit "B" (attached hereto, including the BOARD's RFP and the AUDITOR's written responses to the RFP). 2. PAYMENTS FOR AUDITIRIG SERVICES. In consideration of the rendered in accordance will all terms and conditions and specifications set forth herein and set forth in Exhibits "A" and "B", the BOARD shall make payment for Auditing Services to the AUDITOR as set forth in Exhibit "C", (attached hereto and referred to herein as the "Fee Schedule"). Said payments shall be made within thirty (30) days after full completion of the services by the AUDITOR. Any amendments to the Fee Schedule agreed to by both parties shall be set forth in a written modification to this Agreement. The fees set forth in this section and the Fee Schedule shall be the sole compensation awed by or to any person for the AUDITOR'S services under this Agreement. The maximum price for the three years ending June 3Q, 2016, 2017, and 2018 will be $67,800, $69,000, and $70,200, respectively. Any additional services that may be requested, and the AUDITOR agrees to provide, will be the subject of separate arrangements and billed at the agreed to hourly rates as set forth in the Fee Schedule. 3. RELATIONSHIP OF THE PARTIES. It is understood that this is an Agreement by and between the BOARD and AUDITOR, as an Independent Contractor and it is not intended to, and shall not be construed to, create the relationship of agent, servant, employee, partnership, joint venture, or association, or any other relationship whatsoever between the two parties other than that of AUDITOR as Independent Contractor. 4. NON-ASSIGNABILITY. AUDITOR shall not assign this Agreement or any portion thereof to a third party without the prior written consent of the BOARD, and any attempted assignment without such prior written consent in violation of this section shall automatically terminate this Agreement. 1798705v1 / 19704.0001 2 5. TERM AND TERMINATION. This Agreement shall be in effect from the Effective Date and ending upon completion and presentation of the Audit Report for FGERA Fiscal Year Ending June 30, 2018. Either party may terminate this Agreement at any time for any reason by providing thirty (30) days written notice, with such Termination. to be effective on the date specified in the notice. In the event of termination under this paragraph, the AUDITOR shall be paid for all work provided to the date of termination. 6. INDEMNIFICATION. The AUDITOR agrees to indemnify, defend, and hold harmless FCERA, its BOARD, trustees, officers, and employees from and against any and all claims, actions, losses, damages, and/or liability arising from the RUDITOR's negligent and willful acts, errors, or omissions and for any casts or expenses incurred by FCERA on account of any claim. thereof, except where such indemnification is prohibited by law. 7. INSURANCE. Without in any way affecting the indemnity herein provided, and in addition thereto, the AUDITOR shall secure and maintain throughout the Agreement the following types of insurance with limits as shown: A. Workers' Compensation - A program of Workers' Compensation Insurance or a State Approved Self-Insurance Program in an amount and form to meet all applicable requirements of the Labor Code of the State of California, including Employer's Liability with Twa Hundred Fifty Thousand Dollar ($250,000) limits, covering all persons providing services on behalf of the AUDITOR and all risks to such persons under this Agreement. B. Comprehensive General and Automobile Liability Insurance -This coverage to include contractual coverage and automobile liability coverage for owned, hired, and non-owned vehicles. The policy shall have combined single limits for bodily injury and property damage of not less than Five Hundred Thousand Dollars 1798705x4/19704.0001 3 G. Professional Errors and Omissions Liability Insurance —The AUDITOR will secure an insurance policy for Professional Errors and Omissions insurance with coverage of at least One Million Dollars {$1,000,000) per claim or occurrence and shall cover all the AUDITOR's officers, owners, and employees. 8. ADDITIONAL NAMED INSURED. All policies, except for the Workers' Compensation policy, shall contain additional endorsements naming FCERA and its officers, employees, agents, and volunteers as additional insureds with respect to liabilities arising out of the performance of services hereunder. Copies of the endorsements are to be forwarded to FCERA within thirty (30) days of executing this contract. 9. WAIVER OF SUBROGATION RIGHTS. Except for Professional Errors and Omissions liability, the AUDITOR shall require the carriers of the above required coverages to waive all rights of subrogation against FCERA, its BOARD, trustees, officers, and employees. 1 'i " '' t • • C •' ~ •• - -• -~ above are to be primary and non-contributory with any insurance or self-insurance programs carried or administered by FCERA. 11. PROOF OF COVERAGE. The AUDITOR shall immediately furnish Certificates of Insurance to FCERA evidencing the insurance coverage, including endorsements, required above prior to the commencement of performance of services hereunder, which certificates shall provide that such insurance shall not be terminated or expire without at least thirty (30) days written notice to FCERA, and the AUDITOR shall maintain such insurance from the time the AUDITOR commences performance of services hereunder until the completion of such services. Within sixty (60) days of the commencement of this Agreement, the AUDITOR shall furnish to FCERA certified copies of the policies and all endorsements. 1798705v1/19704.0001 4 12. FORCE MAJEURE. A. In the event the AUDITOR is unable to comply with any provision of this Agreement due to causes beyond its control relating to acts of God, acts of war, civil disorders, or other similar acts, the AUDITOR shall not be held liable to FCERA for such failure to comply. B. In the event FCERA is unable to comply with any provision of this Agreement due to causes beyond its control relating to acts of God, acts of war, civil disorders, or other similar acts, FCERA shall not be held liable to the AUDITOR for such failure to comply. 13. NOTICES AND REPORTS. Any notices and reports required or desired fio be served by either party upon the other shall be addressed to the respective parties as set forth below: .. Donald Kendig Retirement Administrator FRESNO County Employees' Retirement Association 1111 H Street Fresno, CA 93721 Telephone:( 559) 457-0681 Facsimile:( 559) 457-0318 . ~ ~. Rosalva Flores Partner Brown Armstrong Accountancy Corporation 420Q Truxtun Avenue, Suite 300 Bakersfield, CA 933Q9 Telephone:( 661) 324-4971 Facsimile:( 661) 324-4997 14. GOVERNING LAW AND VENUE. This Agreement will be construed in accordance with and governed by the laws of the State of California. Should any party file a lawsuit over any matter arising out of this Agreement, said lawsuit will be filed and prosecuted in the County of Fresno, State of California, and all parties hereto hereby consent to such venue and the personal jurisdiction of all courts sitting within such locale. 1798705v1119704.0001 5 15. ASSURANCE OF COMPLIANCE WITH CIVIL RIGHTS LAWS. The AUDITOR hereby agrees and represents that it is an equal opportunity employer and has adopted policies to implement the purpose and provisions of the Civil Rights Act of 1964, 42 USC § 2000(e) et seq., to assure that no person is denied employment on the basis of race, color, religion, sex or national origin in connection with its performance of this Agreement. 16. NO DISCRIMINATION. The AUDITOR shall take affirmative action to ensure that qualified applicants are employed, and that employees are treated fairly during employment, without regard to their race, color, religion, sex, handicap, ancestry ar national origin. Such action shall include, but not be limited to, the following: employment, upgrading, demotion, or transfer; recruitment ar recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. 17. COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original. 18. CONFIDENTIALITY. Except as provided by applicable law, including but not limited to the California Public Records Act, or by order of a court or regulatory authority, the AUDITOR shall maintain the confidentiality of all its records with respect to this Agreement, including, but not limited to, billing and FCERA records. The AUDITOR shall maintain the same confidentiality of these records as it does for other accounts. 19. VALIDITY. The invalidity in whole or in part of any provision of this Agreement shall not void or affect the validity of any other provision. 1798705v1119704.0001 6 20. WAIVER. No waiver of a breach of any provision of this Agreement by either party shat( constitute a waiver of any other breach of said provision or any other provision of this Agreement. No waiver will be enforceable unless it is a written agreement executed by the party granting the waiver, making specific reference to this Agreement and reciting the parties' intention that it constitutes a waiver. Failure of either party to enforce at any time, or from time to time, any provisions of this Agreement shall not be construed as a waiver thereof. The remedies herein reserved shall be cumulative and additional to any other remedies in law or equity. 21. ATTORNEY FEES. In the event of any litigation regarding this Agreement, the prevailing party, as determined by the appropriate court, shall be entitled to recover reasonable attorney's fees. 22. CHANGES AND AMENDMENTS. FCERA and the AUDITOR reserve the right to amend any such terms and conditions of this Agreement, which may become necessary. Any revisions hereto will be accomplished by written agreement executed by both of the parties making specific reference to this Agreement and reciting the parties' intention that it constitutes an amendment. 23. MERGER. This Agreement, and the Exhibits attached hereto, will constitute the complete and exclusive statement of understanding between the parties, superseding all previous agreements, written or oral, and all other previous communication between the parties relating to the subject matter of this Agreement. 24. SOLE PROPERTY OF THE. BOARD. Any system, documents, or reports developed, produced, or provided under this Agreement shall become the sole property of FCERA. 25. AGREEMENT RENEWAL. This Agreement may be renewed for additional time periods provided that both parties sign renewal documents and the total payments during the renewal terms are specified. 1798705v1/19704.0001 7 EXECUTED AND AGREED TO by the parties as of the date first written above by their duly authorized representatives: BROWN ARMSTRONG FRESNO COUNTY ACCOUNTANCY CORPORATION EMPLOYEES' RETIREMENT ASSOCIATION '~~°-~. Signature Signature Rasalva Flores, Principal Print Name and Title Print Name and Title April 7, 2016 Date Date 1798705v1/19704.0001 "~~<;, ~~. 1798705v1 / 19704.0001