Agenda - 05-03-2007-4d - Laserfiche WebLink

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McGladrey& Pullen Certified Public Accountants April 23, 2007 The Honorable Manager and Members of the County Commissioners Orange County, North Carolina P.O. Box 8181 Hillsborough, North Carolina 27278 McGladrey fi Pullen, LLP 230 North Elm 5t, Ste i10D, Greensboro, NG Z~401-2436 P.O. Box 247D, Greensboro, NC 27402.2470 0 336.273.4461 F 336.2142519 wwwmcgladreycom Attention: Mr. Kenneth T. Chavious, Finance Director This letter is to explain our understanding of the arrangements for the services we are to perform for the Orange County, North Carolina ("County") for the year ending June 30, 2007. We ask that you either confirm or amend this understanding. We will perform an audit of the County's governmental activities, business-type activities, discretely presented component unit, each major fund, and aggregate remaining fund information as of and for the year ending June 30, 20D7 which collectively comprise the basic financial statements. We understand that these financial statements will be prepared in accordance with accounting principles generally accepted in the United States of America. The objective of an audit of financial statements is to express an opinion on those statements. We will also perform the audit of the County as of June 30, 2007 so as to satisfy the audit requirements imposed by the Single Audit Act and the U.S. Office of Management and Budget ("OMB") Circular No. A-133 and the state of North Carolina Single Audit Implementation Act. We will conduct the audit in accordance with auditing standards generally accepted in the United States of America; GovemmentAuditingStanchrds issued by the Comptroller General of the United States; the provisions of the Single Audit Act, OMB Gircular A-133 and OMB's Compliance Supplement; and the State Single Audit Implementation Act, Those standards, circulars, supplements or guides require that we plan and perform the audit to obtain reasonable rather than absolute, assurance about whether the financial statements are free of material misstatement whether caused by error, fraudulent financial reporting, or misappropriation of assets. Accordingly, a material misstatement, whether caused by error, fraudulent financial reporting, or misappropriation of assets, may remain undetected. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. As a result, an audit is not designed to detect errors or fraud that are immaterial to the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit will provide a reasonable basis for our reports. In addition to our reports on the County's financial statements we will also issue the following reports or types of reports: A report on the fairness of the presentation of the County's schedule of expenditures of Federal and State awards for the year ending June 30, 2007. Reports on internal control related to the financial statements, and major programs. These reports will describe the scope of testing of internal control and the results of our tests of internal controls. McGiadrey & Pullen, LLP is a member firm of RSM International - an affiliation of separate and independent legal entities. 3.