R94-26 AUTHORIZING AGREEMENT GEO. S. OLIVE & COMPANY

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• • « • Mr. James C. Bacon, Jr. March 18, 1994 Page Two An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the �nancial statements; therefore, our audit will involve judgment about the number of transactions to be examined and the areas to be tested. Also, we will plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. As required by the Single Audit Act of 1984, our audit will include tests of transactions related to federal assistance programs for compliance with applicable laws and regulations. However, because of the concept of reasonable assurance and because we will not perform a detailed examination of all transactions, there is a risk that material errors, irregularities, or illegal acts, including fraud or defalcations, may e�st and not be detected by us. We will advise you, however, of any matters of that nature that come to our attention, and will include such matters in the reports required for a Single Audit. Our responsibility as auditors is limited to the period covered by our audit and does not extend to matters that might arise during any later periods for which we are not engaged as auditors. We understand that you will provide us with the basic information required for our audit and that you are responsible for the accuracy and completeness of that information. We will advise you about appropriate accounting principles and their application and will assist in the preparation of your financial statements, but the responsibiliry for the financial statements remains with you. This responsihility includes the maintenance of adequate records and related internal control structure, the selection and app(ication of accounting principles, and the safeguarding of assets. You will maintain all records you need, as we will not retain any of our workpapers bcyond the period required by our policy on retcntion. The assistance to be supplied by your personnel, including the preparation of schedules and analyses of accounts, will be discussed and coordinated with Ms. Beth B. Couter, Director of Financial Management, and Ms. Dawn Yuhas, Comptroller. The timely completion of this work will assist us in achieving an efficient performance of our work. A list of the materials that your personnel will have ready at the start of the audit will be discussed and agreed upon with Ms. Couter and Ms. Yuhas at the plannin� meeting to be held March 22, 199�t. Our audit is not speci�cally designed and cannot be relied on to disclose reportable conditions, that is, significant deficiencies in the design or operation of the internal control structure. However, during the audit, if we become aware of such reportable condi- tions or ways that we believe management practices can be improved, we will communicate them to you in a separate letter.