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HomeMy WebLinkAboutDocumentation_Pension Public Safety_Tab 07_02/14/2006VILLAGE OF TEQUESTA Finance Department 250 Tequesta Dr., Suite 304 Tequesta, FL 33469-0273 561-575-6206 Fax:561-575-6232 January 18, 2006 G. Jerry Chiocca, CPA Rachlin Cohen & Holtz LLP One Southeast Third Avenue, l0a' Floor Miami, Florida 33131 Re: Separate Audit Report for the Public Safety Pension Trust Jerry, As we discussed briefly at the Government Symposium yesterday, the Board of Trustees of the Village of Tequesta's Public Safety Pension Trust, at their last meeting, asked me to contact you regarding the issuance of a separate audit report for the Public Safety Pension Trust for the year • ending September 30, 2005. Some question they had concerning the report are: 1. The cost to issue a separate report. 2. If, rather then issuing a separate report, your firm could issue an attestation letter addressed to them based upon the audit work completed with the audit of the Village's fmancial statements. a. The cost to write the letter. Last year I asked Jan Smith, audit supervisor, if issuing a separate report would require expanding the scope of the audit performed on the PensionTrust's financial statements or require additional testing and was told that with the exception of the additional disclosure in Management's Disclosure and Analysis (MD&A), there was no additional work performed. If there are additional disclosures or reasons why it would benefit the Trust to have a separate audit report issued please let me know so that I can report to the Trustees. As fiduciaries they would like to be assured that they are protecting themselves as well as the Pension trust assets in the performance of their duties. Sincerely, JoAnn Forsythe, CPA Village of Tequesta Finance Director • 561-575-6207 j forsythe@tequesta.org Cohen `Holtz Accountants Advisors • January 9, 2006 JoAnn Forsythe, CPA Finance Director Village of Tequesta 250 Tequesta Drive, Ste. 300 Tequesta, FL 33469-0273 Re: Separate Audit Report for the Public Safety Pension Trust Dear Jody: In response to your letter dated December 2, 2005, there are additional disclosures, other than the Management's Discussion & Analysis in a stand-alone pension audit report as well as preparing the actual statement. We usually charge approximately $4,000 to $6,000 depending on the size of the plan. We are precluded from writing a letter to you as described in No. 2. The benefits of having a separate report is that it can be distributed to the plan participants and it has disclosures in detail about the plan that is not in the City's financial statements as well as the • comfort to the Trustees that they are performing the fiduciary responsibilities. If you have any further questions, do not hesitate to contact me. Sincerely, ~~~' 1 GllJerry Chiocca, CPA Partner F:\06\76553U. Forsythe Ltr. ~---- • +, a ~_ RachOin Cohen & Holtz ur One Southeast Third Avenue ^ Tenth Floor ^ Miami, Florida 33131 ^ Phone 305.377,4228 ^ Fax 305.377.8331 ^ WWw.r8ChI1I1.COm An lndaparde~~f N?ember cf eakei Ti;ly !nterr,ational M I A M I • F O R t L A U D E R D A L E ^ W E S T P A L M B E A C H ^ S T U A R T • BOARD OF TRUSTEES TEQUE.STA PUBLIC SAFE'L'Y OFFICERS PENSION TRUST FUND MEETING MINUTES November 8, 2005 PAGE ~ assessment, and this should be a lot of money for the pension. Attorney Jensen commented the firefighters benefited from. property taxes, and in many municipalities there had been tremendous benefit. Boazd member Nielson asked if there would be any benefit for Jupiter Inlet Colony. Secretary Giblin responded they were already collecting the tax, but it was going to the State. Chair Sabin noted it sounded political rather than economic, and asked Ms. Carlisle to advise all of the members of the board the date of the Jupiter Inlet Colony meeting. Board member Genco suggested the firefighters show up in uniform. Secretary Giblin explained there was already an Interlocal agreement. Attorney Jensen advised that the interlocal agreement would not suffice for this matter--Jupiter Inlet Colony had to pass an ordinance-this was a new provision passed this year. 13. Renewal of Fiduciary Liability Coverage er, Risk Manager, was recommending Pension Coordinator Cazlisle advised that Dan Gallagh Travelers with $2 million coverage and a premium of $3,961. The General Employees Boazd would pay $743 and Public Safety Officers Board would pay $3,218-approvals were • needed from both boards. MOTION: Board member Genco made a motion to approve payment of this board's pro-rated portion of the premium of $3,961 to Travelers Insurance for fiduciary liability coverage in the amount of $2 million, and ~`cers board wouldlpay 100%rof tthe per mium. coverage then the Public Safety Off Secretary Giblin seconded the motion, which carried by unanimous vote. 4. Discussion of whether a full audit should be done in future years Pension Coordinator Cazlisle asked if the board wanted to do a schedule for audits so that it would be known when an audit would be don danot ane audit every year. uLast yeaz th~had Director Forsythe advised that actually the Boaz g requested a stand alone audit. Ms. Forsythe advised she believed there had for this misunderstanding, and she had spoken to the State as to whether it was necessary board to have a stand alone audit and they had advised no, that most funds were included in the CAFR-if they were just issuing financial stant d he was the one who had brought thin they would not accept those. Chau Sabin comme up after attending the trustee school and he Masses and advised the board accept d the required. An attorney stood up m one of the c the were not CAFR that had other financial information and was a report for the Village, y getting an audit for protection for the board of trustees. Board member Genco commented • she thought the Boazd was given a separate one even though it was part of the CAFR. Chair • BOARD OF TRUSTEES TEQUESTA PUBLIC SAFETY OFFICERS PENSION TRUST FUND MEETING MIL1fUTFS November S, 2005 PAGE 8 Sabin advised no, if you read the opinion it was given as supplementary financial information and the opinion was directed to the V illage Council as opposed to the trustees. Chair Sabin commented the board had sent him to trustee ~~~a °~e audit was written for anybody knowledge. Discussion ensued. Ms. Forsyth who was a third party who relied on that audited financial statement and the reason it was made to the Village Council was the auditors were not supposed to give an audit report back to the people who worked with the information because they could change the numbers. Chair Sabin commentedthe-board would have a more difficult time indicating they were a party to that opinion. Board member Genco suggested asking the auditors whether in doing the audit they could write each pension board a separate opinion letter. Ms. Forsythe stated there would be a charge. Chair Sabin agreed there would be a chazge because the auditors would be doing additional work. Ms. Forsythe indicated there would not be extra work. Chair Sabin asked then why would there be a chazge of $4,000 to $6,000. Ms. Forsythe commented he did notunderstand-Chair Sabin advised he was a CFO of a public company and he did understand. Ms. Forsythe commented auditors were independent and were not allowed to do any of the work-they were like doctors who went in to see if transactions • could be supported, and identify certain risks and put more time into those areas. When they wrote the audit report they were saying they had looked at this and did not find anything that were material mistakes-they did not find anything that if it were changed it would cause a different understanding of the financial statements. Chair Sabin stated as a trustee and a volunteer who did not wish to have personal liability responsibility by being a boazd trustee member, he was looking for the level of assurance and fiduciary responsibility that he did not have that exposure. Ms. Forsythe commented he did not; Chair Sabin responded he had been told otherwise at the trustee school. Board member Genco commented she thought Finance Director Forsythe was saying the auditors were doing a full audit and that is the type of audit the board would get if they were addressing the letter to the boazd, and the difference was they were addressing it to the Village Council, and asked to find out what the auditors would charge to write a separate letter addressed to the trustees, for which there might be a $100 or $200 fee . Ms. Forsythe commented it would probably be about $4,000 because it would be a stand alone opinion. Board member Genco commented they were writing the same exact letter to the Village Council and they should be able to write a letter to the pension boards that said the same thing, and the work was exactly the same so there should not be a big difference. Discussion ensued as to what the auditorheoodlka the difference was the le a of she had spoken with another auditor who had advised analysis; Ms. Forsythe stated there should not be a difference. Chair Sabin stated he was asking to focus on one issue that came out of the trustee school and he knew it was not a State requirement but he wanted to know if there was a fiduciary responsibility of this • board from a financial sense without an audit report directed to this board. If the answer was no, that it was adequate to relieve the fiduciary responsibility, then he was okay with it • BOARD OF TRUSTEES TEQUESTA PUBLIC SAFETY OFFICERS PENSION TRUST FUND MEETING MI11fUTE8 November 8, 2005. PAGE 9 subject to what the board wanted toa ~ htrust~ee school vBoard m mberrGeno stated she reacting to what he had been told agreed with Chair Sabin. Ms. Forsythe asked that the board look at this in terms of the SEC-that people bought securities based on audit reports, and if the information was wrong there was recourse back to the people who did that. Chair Sabin commented he had to trust the people who taught at the trustee schohow to bran board a Board member Genco agreed, he had to rely on then information as to stating the board should get ~a letter along with the full report for the Village Council, and asked Ms. Forsythe fo find out the cost to do that it was her understanding the data the auditors were looking at was the same. Boazd member Genco asked that Rachlin Cohen come to the board and give a presentation and explain it to the boazd. Chair Sabin stated the board wanted an audit opinion addressed ontact the erson who spoke at the trust easchool the CAFR. Chair Sabin stated he would p and would report back to the board. Attorney Jensen stated she felt an independent report would give the trustees more information than the CAFR. Board member Genco asked that Ms. Forsythe find out where the board stood and come back to the next meeting. Chair Sabin • stated as a volunteer he was trying to help the Village, but he did not want to take personal liability. Ms. Forsythe stated she could ask the auditors if they felt the CAFR letter also protected boazd members. Pension Coordinator Carlisle asked if they were looking at the investments when they did the audit for the Village. Ms. Forsythe responded Village staff actually did the report the payment wassnaodt fohe wou d le the finform t on from the person advised he did not care what the auditor g who had been at the trustee school. MOTION: Board member Genco made a motion to table this matter to the next meeting when all the official information had been obtained and that an outline of costs be presented to the board as well as a proposal of audit dates and years for future audits, in a table- such as every odd or even year or whatever the board wanted to do regarding the audits-along with the costs of doing a separate letter to the board. Secretary Giblin seconded the motion. During d ed to the February tmeetinga and then the board clarification that if this were delay decided the auditors needed to do a separate report, when would that occur. Ms. Forsythe responded that the auditors elson comment d hemwou d I ke t hear what had been delayed. Board member N financial comfort the board would get from an audit to this board instead of just to the Village Council. Attorney Jensen advised that the analysis in the CAFR was in a large • document and many board members would not take the time to go through that, and stated her question was how much attention was paid to the pension fund as a stand • BOARD OF TRUSTEES TEQUESTA PUBLIC SAFETY OFFICERS PENSION TRUST FUND MEETING MINUTES November 8, 2005 PAGE io - alone item when it was included in the CAFR Board member Nielson asked if the auditors signed an opinion letter-if they wrote a separate letter-would there be any additional comfort for this board. Attorney Jensen advised she believed it was within the board's fiduciary responsibility to have d~fereuce and they had said theslevel of additionally she had asked some auditors the material that they would bring forward to the board of trustees would be different than if it were included in the CAFR as supplemental information. Chair Sabin commented they would have to do a scope of work that was a different level and the opinion to the board would be direct relationship, and it was better to have a direct relationship as opposed to being included in the CAFR for the Village, which would be an indirect relationship of fiduciary responsibility. Board member Genco advised that up until now the auditors had done more analysis than typical and had advised the Village of any irregularities, which was why she suggested to table this for more information. Chair Sabin commented he was not questioning their work, he was not ques t m g anything beyond the opinion page-who it was addressed to-that was the only g. Board member Genco stated she agreed with him and there would be appropriate • answers at the nett board meeting. Chair Sabin commented the board was also going to talk about sending someone to trustee school and they could ask that question there because that was where the information was coming from as to how to run the board. Motion carried unanimously to table this item VIII. STANDING REPORTS 15. Approval of new applicants for participation in Pension Plan Christopher Allen Broedell Date of Hire: 9/6/05 Police Officer Michael C. Morrill Transfer from FRS Police Officer Kristopher Wilhelm Date of Hire: 9/19/05 Fireman 16. Approval of Beneficiary Changes None 17. Request for withdrawal of contributions (employees terminating employment with Village of Tequesta) • Name Date of Se aration Total Amount