REQUEST FOR PROPOSAL FOR FORENSIC AUDITING...

Ocean Pines Association, Inc. RFP for Forensic Auditing Services

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OCEAN PINES ASSOCIATION, INC

REQUEST FOR PROPOSAL

FOR

FORENSIC AUDITING SERVICES

Proposal Due Date: 12 Noon on Monday, March 19, 2018

INQUIRIES AND PROPOSALS SHOULD BE DIRECTED TO:

Mr. John S. Bailey, General Manager

Email: [email protected]

OCEAN PINES ASSOCIATION, INC.

239 Ocean Parkway, Ocean Pines, MD, 21811

410.641.7717

www.oceanpines.org

http://www.oceanpines.org/


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ACKNOWLEDGMENT OF RECEIPT

Description: FORENSIC AUDITING SERVICES

NOTE: Please fill in the requested information below as acknowledgment that you

have received the Request for Proposal noted above. If your firm is interested in

participating, it is highly recommended that this sheet be completed and returned

or faxed to: OPA, Attn: John S. Bailey, General Manager, FAX: 410-641-5581.

This will enable us to provide notification of any changes should that occur.

Name of Firm: __________________________ ____

Address: ___________________________________

Fax #: ___________________________________

Tel. #: ___________________________________

Name and Title:_____________________________, _____________________

(Print)

Signature: ______________________________________

Date: __________________________________________

E-mail:_________________________________________


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PLANNED SCHEDULE OF EVENTS ACTIVITY DATE:

1. Release RFP March 1, 2018

2. Questions Due March 8, 2018

3. Proposals Due, 12 Noon, March 19, 2018

4. Proposed Contract Award April 2, 2018

5. Anticipated forensic audit to begin on April 16, 2018

TABLE OF CONTENTS:

A. GENERAL

B. PROPOSAL INSTRUCTIONS

C. GENERAL TERMS AND CONDITIONS

D. PROPOSAL REQUIREMENTS

E. SCOPE OF WORK

F. EVALUATION CRITERIA

G. PRICING SCHEDULE


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A. GENERAL

1. Introduction

Ocean Pines Association, Inc. (ASSOCIATION) is seeking a firm with CFE resources capable of conducting a

forensic accounting investigation. To be considered for award, firms submitting a proposal must be able

to conduct investigations of potential fraudulent activity and support subsequent legal action, if required,

on behalf of the ASSOCIATION.

The ASSOCIATION prefers not to engage with any firms it used in the past for audit work. The

ASSOCIATION does not intend to engage with a firm that could, in any way, be interpreted as having a

conflict of interest.

2. Description of Entity

The ASSOCIATION is a not-for-profit homeowners’ association incorporated in 1968 and located in

Worcester County, Maryland. The ASSOCIATION has been determined to be exempt from Federal Income

tax under Section 501(c)(4) of the Internal Revenue Code. The ASSOCIATION is responsible for providing

the following services to its members: administrative and finance, clubs, architectural control, public

safety, public works and recreation. The ASSOCIATION consists of approximately 8,452 platted residential

lots located on approximately 3,500 acres in Ocean Pines, Maryland.

ASSOCIATION has an annual budget of approximately $11.4 million and is governed by a seven (7) member

volunteer Board of Directors. Administrative offices are located at 239 Ocean Parkway, Ocean Pines, MD,

21811.

The vision of Ocean Pines is to be a premier resort community, offering exceptional value and quality of

life to property owners who are diverse in age, economic status and interests, and to primarily provide

residents the facilities, services and amenities that are attractive, affordable, safe and enjoyable.

Today, there are approximately 12,000 full-time residents and 8,000 part-time residents and associated

guests living and participating in Ocean Pines. It also has restaurants and extensive recreation facilities.

The operations of the Association are divided in to departments, including finance, food and beverage,

golf, aquatics, public works, and police, under the management of the General Manager. Within food the

food and beverage department, there are three restaurants, The Beach Club, The Tern Grille and The

Yacht Club (a/k/a Mumford’s Landing).

B. PROPOSAL INSTRUCTIONS

1. PURPOSE OF RFP

The purpose of this Request for Proposal is to obtain proposals from qualified entities to provide forensic

auditing services. It is anticipated that the forensic audit will have more than one phase. As discussed in


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greater detail in the Scope of Work section below, phase one will cover the Food and Beverage

Department. The ASSOCIATION intends to continue to conduct a forensic audit of multiple departments.

After meeting with the selected PROPOSER, it will be determined if these additional department audits

are carried out concurrently or sequentially.

2. PROPOSAL QUESTIONS

All questions regarding this Request for Proposal should be directed to: Attn:

John S. Bailey, General Manager, 239 Ocean Parkway, Ocean Pines, MD, 21811, FAX: 410-641-

5581, E-Mail: [email protected]

Questions will only be accepted until 5:00 p.m. on Thursday, March 8, 2018. ASSOCIATION will not

respond directly to the single entity asking the question(s). Questions that the ASSOCIATION feels need

response will be answered in the form of an addendum and sent to all potential bidders who have sent

their acknowledgement of receipt of the RFP.

3. PROPOSAL SUBMISSION

The PROPOSER is responsible to assure that Proposals are received as follows:

The Proposal package must contain one (1) original and six (6) copies of the proposal. In addition to the

hard copies, one CD/DVD or a Flash drive containing the electronic copy of the proposal should be included

with the original proposal. The original must be clearly marked "Original" and the Proposal package must

be delivered Sealed. The Proposals must be addressed to the attention of and received at the following

address: Ocean Pines Association, Attn: General Manager, 239 Ocean Parkway, Ocean Pines, Maryland

21811.

Proposals received after this time and date shall not be considered and will be returned unopened or

otherwise disposed of by the ASSOCIATION. The following information must be clearly visible on the outer

most Proposal Packaging: Request for Proposal for FORENSIC AUDITING SERVICES Proposal Closing

Date: Monday, March 19, 2018 Time: 12 Noon.

NOTE: If the Proposer plans to deliver in person or have the proposal packaged hand delivered, you are

encouraged to inform the ASSOCIATION’s contact person of your intentions in advance. Regardless of the

delivery method, it is your responsibility to insure on-time delivery.

4. PROPOSAL EVALUATION and AWARD

This Request for Proposal does not constitute a commitment by the ASSOCIATION to award a contract or

considered an agreement of any kind. The ASSOCIATION reserves the right to reject any or all proposals,

or to cancel this Request for Proposal. The award shall be made to the responsible PROPOSER that is most

advantageous for the ASSOCIATION, based on the needs, requirements and evaluation criteria specified

in this RFP. The ASSOCIATION does not intend to evaluate proposals solely on quoted fees and other

costs. No contract award shall exist until ASSOCIATION notifies the PROPOSER, in writing, that its proposal

has been selected for award.


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5. PROPRIETARY INFORMATION

In the event any PROPOSER includes in its Proposal any information it believes to be proprietary or

protected, the PROPOSER shall clearly mark that information with the term “Proprietary.” The

ASSOCIATION’s legal counsel shall make the final determination if the information is proprietary in nature.

ASSOCIATION discourages the submission of such information and undertakes to provide no more than

reasonable efforts to protect the proprietary nature of such information.

6. PROPOSAL FORM

All proposals must be submitted in writing. Oral, telephone, facsimile (fax machine) or computer data

transfer proposals will not be accepted. Each Proposal shall provide the concise description of the

proposer's ability to meet the requirements of the RFP. Emphasis should be on completeness and clarity

of contents. Voluminous proposals with non-relevant information are specifically NOT encouraged.

7. WITHDRAWAL OF PROPOSALS

A PROPOSER may withdraw its proposal by written request at any time prior to the deadline set for receipt

of proposals. No proposal may be withdrawn or modified after that deadline and shall be binding upon

PROPOSER for a period of thirty (30) days after due date, except as otherwise agreed to by the

ASSOCIATION. The ASSOCIATION may request that PROPOSERS submit written best and final offers

specifying any changes to their original proposals.

8. COST OF PREPARING PROPOSALS

Any and all costs associated with the preparation of responses to this Request for Proposal shall be the

entire responsibility of the PROPOSERS and will not be reimbursable by the ASSOCIATION.

9. AWARD WITHOUT ANY DISCUSSION

The ASSOCIATION reserves the right to make an award without any discussion about the proposals

received. Therefore, it is recommended proposals be submitted initially with the most favorable terms.

10. CONTRACTOR SIGNATURE

The PROPOSER’s signature on this Proposal guarantees that the prices offered have been established

without collusion with other eligible Proposers and without effort to preclude the ASSOCIATION from

obtaining the lowest possible competitive price.

11. CONTRACT DOCUMENT

The ASSOCIATION will not sign a separate contract with PROPOSER whose Proposal is selected for award.

This Request for Proposal and the PROPOSER selected for award will constitute the Contract and the

ASSOCIATION will issue future purchase orders for specific audit services based on this contract.

C. GENERAL TERMS AND CONDITIONS The following General Terms and Conditions, which become part of any award made from this RFP,

constitute the provisions of the agreement to be executed between the ASSOCIATION and successful

PROPOSER. The ASSOCIATION reserves the right to negotiate with the successful PROPOSER and modify

any of the provisions of the agreement upon mutual agreement of both parties.


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1. PARTIES TO AGREEMENT

The agreement shall be between the Ocean Pines Association Inc., hereafter referred to as the

ASSOCIATION, and the successful PROPOSER, hereafter referred to as PROPOSER.

2. LIABLITY FOR TAXES

The PROPOSER assumes complete liability for all taxes applicable to the operations, income, and

transactions of the PROPOSER. The ASSOCIATION shall not be liable and will not make reimbursement to

the PROPOSER for any tax imposed either directly or indirectly upon the PROPOSER by any authority

because of the contract or otherwise.

3. CONTRACT ASSIGNMENT

This Contract, in part or in whole, shall not be subcontracted or assigned to another entity without prior

written permission of the ASSOCIATION’s appropriate authority.

4. INSURANCE REQUIREMENTS

The PROPOSER guarantees that it maintains all required insurance policies. The ASSOCIATION shall not be

held liable or responsible for any damages or injuries that may occur during the time PROPOSER is engaged

with the ASSOCIATION. The PROPOSER’s insurance must be primary, and any insurance or self-insurance

maintained by the ASSOCIATION shall not contribute to it. If any part of the Contract is subcontracted,

these insurance requirements also apply to all subcontractors.

5. INDEMNIFICATION

To the fullest extent permitted by law, PROPOSER shall defend, indemnify, and hold harmless the

ASSOCIATION, its agents, officers, officials, employees, and volunteers from and against all claims,

damages, losses, and expenses (including but not limited to attorney fees and court costs) arising from

the acts, errors, mistakes, omissions, work or service of the PROPOSER, its agents, employees, or any tier

of PROPOSER's subcontractors in the performance of the Contract.

6. PERMITS

The PROPOSER shall be financially responsible for obtaining all required permits, licenses, and bonding to

comply with pertinent state and federal laws, and assume liability for all applicable taxes including but

not restricted to sales, and personal property.

7. PROVISION OF SUPPLIES, MATERIALS AND LABOR

The PROPOSER shall furnish all supplies, equipment, and all management and labor necessary for the

efficient and sound provision of the services included in this Contract, subsequent extensions and

amendments.

8. CONFLICT OF INTEREST

Pursuant to this Contract and/or any Purchase Order(s) issued against it is subject to cancellation by the

ASSOCIATION if any personnel significantly involved in this Contract are found to be in conflict of interest.

9. SAFE KEEPING OF RECORDS

PROPOSER shall keep in a safe place all financial records and statements pertaining to the operations of

this Contract for a period of three (3) years from the end of this Contract.


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10. CHARGES OUTSIDE SCOPE OF AGREEMENT

Charges of the PROPOSER for services not permitted by or beyond the scope of this Contract shall be an

expense of the PROPOSER and not of or reimbursable by the ASSOCIATION.

11. COMPLIANCE WITH LAWS

The PROPOSER shall at all times comply with the federal and state laws and shall indemnify, hold harmless,

and defend the ASSOCIATION from any and all costs or expenses whatsoever arising out of PROPOSER's

compliance or noncompliance therewith.

12. CONTRACT TERMINATION

The ASSOCIATION may terminate this Contract for convenience by giving PROPOSER written notice of

termination. The ASSOCIATION may terminate this Contract immediately if the PROPOSER files for

bankruptcy or receivership, or takes any actions relating to insolvency.

13. INTERPRETATION

The parties intend this Contract to express their complete and final agreement.

14. RISK

The PROPOSER assumes all risks encountered that are due to any conditions within PROPOSER’s direct

control. Additionally, PROPOSER assumes all risk for difficulties in the nature of the project or the work

that PROPOSER knew or should have known about at the time of submission of each individual project

proposal resulting from this solicitation.

15. CONFIDENTIAL INFORMATION/PRIVACY LAWS

The ASSOCIATION is subject to various federal and state laws mandating that it keep certain information

confidential. The PROPOSER may receive or have access to confidential information during the

performance of this contract. The PROPOSER agrees that it will not disclose, publish, reproduce, or

otherwise make available information that the ASSOCIATION identifies to it as confidential without the

written authorization of the ASSOCIATION. This requirement survives the termination or cancellation of

this Contract.

16. WORK TO BE PERFORMED BY OTHERS

The ASSOCIATION reserves the right to perform any and all services in-house or may utilize the services

of other firms on projects unrelated to this Contract.

17. PAYMENT

After services have been provided, partial payments may be requested by submitting an itemized invoice

(clearly referencing a Purchase Order number) and any supporting documentation that may be required.

IN NO INSTANCE, HOWEVER, SHOULD ANY SERVICES BE PROVIDED NOR WILL ANY PAYMENT BE MADE

WITHOUT A SIGNED PURCHASE ORDER HAVING BEEN ISSUED FOR THOSE SERVICES BY THE

ASSOCIATION.


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18. REPORTING REQUIREMENTS

Following the completion of the forensic audit, the PROPOSER shall issue a written report communicating

all discovered abnormal activity, past or present, its quantification, cause and consequence. Upon

completion of the final forensic audit report, the PROPOSER must provide the ASSOCIATION with ten (10)

bound copies and one (1) unbound copy of the audit reports. Further, the PROPOSER shall provide an

electronic version of the same audit reports. The electronic versions of the reports shall be in PDF format

and not be password protected. At a minimum, the final reports should include a management summary;

purpose and scope of review; description of work performed; review period; background information (of

area reviewed); findings & recommendations; administrative responses to the findings and

recommendations; and if applicable, other recommendations. A representative of the PROPOSER is

expected to present the final audit report to the Board of Directors and the General Manager of the

ASSOCIATION.

19. AUDIT PLAN

PROPOSER may be asked by the ASSOCIATION to submit a plan for forensic audit. The plan should include

a description of the available options for handling the forensic audit assignment, the major steps likely to

be involved, the timing and sequence of the project phase, and the estimated costs associated with each

project phase. Significant changes in the scope of the originally submitted forensic audit plan may be

negotiated if it is mutually agreed that such changes are desirable and necessary. Any such changes must

be submitted in writing to the ASSOCIATION’s President and the General Manager and be approved by

the same in advance prior to the performance of work.

20. ENTRANCE & EXIT CONFERENCES

Prior to the beginning of the forensic audit work, an entrance conference shall be conducted by the

PROPOSER and its certified forensic examiner (CFE) official(s). The ASSOCIATION’s senior staff shall

participate in the entrance conference along with some members of the Board. Following completion of

the draft audit reports, the PROPOSER shall be available to participate in an exit conference. The exit

conference is to discuss the draft audit reports with the PROPOSER’s staff that conducted the audit,

identify any errors, and obtain comments on the reports' findings and recommendations.

D. PROPOSAL REQUIREMENTS This section of the RFP lists minimum and specific requirements, written responses or confirmations. To

be considered for selection, PROPOSERS must demonstrate in their proposal that they meet the following

requirements and have provided all required information.

1. MINIMUM REQUIREMENTS

• Be licensed as independent certified public accountants, public accountants, certified forensic

accountants, certified in financial forensics or certified fraud examiners (in good standing) in the

State of Maryland.

• Exhibit strong experience in the forensic auditing services.

• Offer fees that are reasonable and competitive.


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2. SPECIFIC REQUIREMENTS

• The PROPOSERS shall provide a brief description and history of the firm, including forensic audit

experience in the examination of this type of clients;

• The PROPOSERS shall provide a completed pricing schedule, Section G of the RFP, signed by an

authorized representative of the PROPOSER confirming its offer and acknowledging its

understanding of the requirements of this Request for Proposal;

• The PROPOSERS shall provide a list of at least three references related to conducting forensic

audits for clients, including name, address, phone, and point of contact;

• The PROPOSERS shall provide a copy of the firm’s most recent external quality control review

opinion and letter of comments;

• The PROPOSERS shall provide the following information for the area of forensic concentration in

which the PROPOSER offers to provide services:

- General background information with respect to the audit firm as well as its partners

or representatives with special focus on fraud audit/forensic accounting services;

- Specific information with respect to firm’s each area of specialization.

• The PROPOSERS shall submit (in Section G) the following information:

-Hourly rates for the personnel required to deliver forensic auditing services.

• The PROPOSERS must submit a signed copy of the proposal and initial each page. Failure to

submit a signed proposal or initial each page may result in rejection of the proposal.

E. SCOPE OF WORK The first phase of this forensic audit will focus on the ASSOCIATION’s Food and Beverage operations. The

ASSOCIATION operates several large food and beverage sites with a combined annual gross revenue of

$1.713 million. The ASSOCIATION intends to continue to conduct a forensic audit of multiple

departments. After meeting with the selected PROPOSER, it will be determined if these additional

department audits are carried out concurrently or sequentially.

The firm selected must have an established capability to perform forensic accounting procedures for

entities like the ASSOCIATION and to conduct investigations of potential fraudulent activity and support

subsequent legal action if required on behalf of the ASSOCIATION. The selected firm shall perform

necessary forensic accounting procedures to identify and quantify any abnormal activity. If required, the

firm must be available as an expert witness to support legal action.


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F. EVALUATION CRITERIA The following is a listing of general and specific criteria used for the evaluation of this RFP. The areas

include, but are not limited to:

• General quality of responsiveness of proposer:

-Ability to meet all terms and conditions;

-Completeness and thoroughness of proposal;

-Availability to begin the forensic audit soon;

-Description of approach to be taken;

-Evidence of effective organizational and management practices;

-Qualifications of personnel;

-Relevant experience and past performance.

• Specific areas that will be evaluated and scored:

-Experience and Qualifications of Key Personnel (including past performance);

-Experience and Management of the Firm (including past performance);

-Compliance with and written responses to Section D-Proposal Requirements;

-Other requirements of the RFP;

-Reasonableness of Fees and Costs.


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G. PRICING SCHEDULE The undersigned has read and understands all the conditions and terms of this RFP, is authorized to

submit this proposal, and offers to perform the services for the costs/fees indicated below:

MANAGERIAL AND PROFESSIONAL AUDIT PERSONNEL by Position RATE/HOUR

1.

2.

3.

5.

6.

7.

Describe Proposer’s Method of Billing for Services:

Describe Proposer’s Method of Billing Costs:

You may submit a more detailed pricing schedule in lieu of the above as an attachment to this page,

but this page must be signed and included with your proposal.

SIGNATURE: ___________________________________________________________

(PRINTEDNAME): _______________________________________________________

TITLE: ________________________________________________________________

FIRM: ________________________________________________________________

ADDRESS: ____________________________________________________________

CITY, STATE, ZIP: _______________________________________________________

TELEPHONE: __________________________________________________________

FAX NUMBER: _________________________________________________________

SIGNERS E-MAIL: _______________________________________________________

FIRM’s WEBSITE: _______________________________________________________

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