request for information (rfi) - cmers for information (rfi) ... for information written as...

Employes’ Retirement System

Request for Information (RFI)

The response shall be addressed and delivered to:

Beth Conradson Cleary

Deputy Director

City of Milwaukee


789 N Water Street, Suite 300

Milwaukee, Wisconsin 53202

Responses must be received no later than 5:00 P.M., CST,

on Friday, November 14, 2014

The outside of the envelope(s) or package(s) must clearly indicate the name of the request

for information written as “Request for Information for Internal Audit Services for the

Employes’ Retirement System of the City of Milwaukee.” Include the name and address of

the respondent.

Questions can be e-mailed to Beth Conradson Cleary at [email protected].

Please note: ERS reserves the right to reject a Request for Information (RFI) that is

not completed as specified within this document. ERS also reserves the right to

accept or reject any response, to not to proceed with any action and to accept only

those response that are in the best intereset of the ERS. The ERS will incur no

liability for the cost of the RFI preparation.

mailto:[email protected]


Date: 10/31/2014

Contents

Confidentiality ......................................................................... Error! Bookmark not defined.

Introduction and purpose of the RFI ....................................................................................... 3

Scope .................................................................................................................................... 3

RFI procedure ........................................................................................................................ 3

Questions ............................................................................ Error! Bookmark not defined.

Timeframe .......................................................................................................................... 3

Background description of what is requested ......................................................................... 4

Objectives .......................................................................................................................... 4

ERS Overview .................................................................................................................... 4

Background ............................................................................................................................ 4

Current Organization .......................................................................................................... 5

Current Operations ............................................................................................................. 5

Current Technology ............................................................................................................ 5

Services Required .................................................................................................................. 6

Scope of Work to be Performed ............................................................................................. 6

Questionnaire ........................................................................................................................ 8

Internal Audit Charter ............................................................................................. Appendix A

A&O Audit Charter ................................................................................................. Appendix B

Current Contract .................................................................................................... Appendix C

Current Audit Plan .................................................................................................. Appendix D

Designation of Confidential and Proprietary Information..........................................AppendixE


Introduction and purpose of the RFI With this RFI we request information regarding your company and your internal audit

services. The purpose of this RFI document is to gain a better understanding of the current

market for the services required.

Scope Specific information is requested according to the form below.

RFI procedure Please fill in the attached Questionnaire.

Provide a cover letter with primary point of contact and contact information (name,

title, address, telephone number(s), fax number and e-mail address).

Describe your organization and the services you provide.

Provide information demonstrating your ability to fulfill the services identified in this

RFI. Include information about working with public pension plans.

E-mail the contact listed below with any questions.

Answers to this RFI will be evaluated by the management from different areas of the

ERS.

The ERS may require oral presentations in person or by telephone. Responses

should be complete on their face. The ERS reserves the right to request clarifying

information at any point.

Questions

Any questions concerning this RFI may be submitted by e-mail to: Beth Conradson Cleary, at [email protected]. The deadline for questions is 2:00 p.m., Milwaukee time, on Friday, November 7, 2014. The ERS will transmit responses via e-mail to questions received, for responders who have acknowledged an interest in responding to this RFI by 2:00 p.m., Milwaukee time, on Monday, November 10, 2014. Responders may not rely on any representations from the ERS or Annuity and Pension Board members other than the responses provided through the above-described procedure.

Timeframe 10/31/14 – Issue RFI.

11/7/14 – Last date for questions via e-mail (2pm CST).

11/10/14 – Responses to questions issued via e-mail (2pm CST).

11/14/14 – RFI response deadline (5pm CST).

12/16/14 – Board Presentation* (if required)

12/18/14 – Selection of Vendor*

As Soon as Possible – Contract or hire date

*Indicates proposed tentative schedule

mailto:[email protected]


Background description of what is requested

The Employes’ Retirement System of the City of Milwaukee (ERS) invites qualified vendors to submit Requests for Information (RFIs) in providing professional services to perform internal audit services. All RFIs must be submitted by a single primary vendor.

Objectives

The objectives of this RFI are to:

Convey ERS’ internal audit requirements to qualified vendors.

Understand the vendor’s approach and work plan, organizational and personnel

qualifications, previous experience, price and ability to perform internal audit work.

Contract with a professional services firm to fulfill the RFI requirements.

ERS Overview

The ERS manages a $5.0 billion defined benefits pension fund. The ERS was created by an

act of the Wisconsin Legislature in 1937 to provide retirement-related benefits for members

and their beneficiaries. Chapter 36 of the Milwaukee City Charter is the codified provisions of

the pension law and the Board Rules and Regulations further define the law. The Annuity

and Pension Board (Board) governs ERS, and serves as trustee of the System’s funds. The

ERS’ Executive Director is responsible for daily operations, and also serves as Secretary to

the Board.

Background The ERS provides a wide variety of benefits to its members and their beneficiaries,

including:

Service retirement benefits

Disability retirement benefits

Separation benefits

Death benefits

Survivorship options

Group life insurance

Retiree health and dental insurance programs

The ERS also oversees the City’s contribution for payment of the employer’s share of Social

Security, administers group life insurance for all city employees, and administers health and

COBRA dental benefits programs for retired workers.

The ERS covers approximately 14,000 active or deferred employees from the City of

Milwaukee or its participating city agencies. Participating agencies include any board,

commission, division, department, office, or agency of the City government, including

Milwaukee Public Schools (noncertified staff), Milwaukee Metropolitan Sewerage District,

Milwaukee Area Technical College, Veolia, Wisconsin Center District, Housing Authority of

the City of Milwaukee and the Redevelopment Authority of the City of Milwaukee.

Approximately 12,500 retirees, survivors, and beneficiaries receive monthly pension

payments.


Current Organization ERS currently has 41 full time equivalent budgeted positions and 8 contractors most of

whom provide IT services.

ERS’ executive director is responsible for daily operations, and reports to the Annuity and

Pension Board. Functional areas include Member Services: counseling and providing direct

service to members, administering group life, health, and dental insurance benefits;

Financial Services: accounting activities, retiree payroll, staff payroll, benefit calculations;

Investment Services: review of investment managers’ activities, fund balancing, returns;

Information Services, handling the network, hardware and software functions and

maintenance of the information systems; and Administration, which handles board activities,

research activities and general administrative functions.

ERS staff is very knowledgeable about the activities needed to be performed in its various

areas for the successful functioning of all its business concerns.

Current Operations The following list of systems and services is intended to convey the breadth and scope of

ERS business operations. While intended to be complete, the list is neither mutually

exclusive nor collectively exhaustive.

Employee enrollment and tracking

Employee earnings history tracking

Pension benefit calculation (service, separation, and disability)

Pension payment (payroll) distribution (service, separation, and disability)

Pensioner health and dental benefits management (service and disability)

Employee group life insurance management (service, disability, and active employee)

Management, actuarial, and year-end processing and reporting

As of August 2006, the ERS went live with its new consolidated information system:

MERITS (Milwaukee Employes’ Retirement Information Technology System). Most day-to-

day activities are performed through this system which uses electronic workflow and an

associated imaging system. All paper documents are imaged and available on employees’

desktops.

Current Technology

Technical Infrastructure

The ERS has an information technology infrastructure comprised of over 40 virtual servers

residing on VMWare hosts and a Dell SAN connected to a private gigabit fiber optic Ethernet

network. These servers provide technical, office, and businesses services, and are located

at our home office. A hot DR server set is located within our home office and a warm DR

site exists in Madison, WI.. Printing, including high speed printing of checks and direct

deposit advices, is done on site. The user community has modern desktop computers

running Windows 8.1. Office application services provided to the desktop include, but are not

limited to, the Microsoft Office Professional suite of products (Word, Excel, Power Point),

Filenet (Imaging Services) and Microsoft Exchange/Outlook.

Business Applications

ERS’ primary line-of-business application is a pension management information system


named MERITS. MERITS is a java based n-tier application that provides the capability to

process customers throughout the membership lifecycle from enrollment to withdrawal. Each

month the system is used to pay 12,500 retirees and process employer contribution reports

for 11,000 active members. ERS also uses the Sage AccPac accounting package for

general ledger and accounts receivable processing. Departmental payroll and accounts

payable services are delivered by the City under a cooperation agreement, and use

PeopleSoft products. The Investment Division uses on-line business services from

Bloomberg, Zephyr, Mercer, and Northern Trust.

More information can be found at www.cmers.com.

Services Required

ERS is soliciting the services of a qualified firm to conduct internal audit services for a period

of three years with an option to renew for an additional two years.

Scope of Work to be Performed General

An initial risk assessment and the current audit plan is on file with the ERS. A review of

these documents will be performed with the result being a multi-year revised internal audit

plan.

The internal audit will be conducted in accordance with generally accepted auditing

standards; the standards for financial audits contained in Government Auditing Standards

issued by the Comptroller General of the United States; or the standards for internal audits

established by the Institute of Internal Auditors. (Please note that the ERS currently

contracts with a separate vendor for financial audit services specific to our financial

statements.)

The audits will include tests of the various operations of the ERS, and the contribution

reporting of its seven agencies.

Areas for Audit Ethics and Governance, Accounting/Finance, Investments, Enrollment and Member Services, Benefit Calculation, Contributions, Benefit Payroll, Benefit Administration (Health/Dental/Life), HR/Payroll, AP Vendor Management, IT General Controls, IT Governance, Business Continuity, Social Engineering, Vulnerability Assessment and Penetration Testing, Risk Assessment Non-IT (Update and Audit Planning), Risk Assessment – IT (Update and Audit Planning), Prior Audit Issue Follow-up/Retesting, Management Requests/Special Projects, and Engagement Management. Irregularities and/or Illegal Acts Auditors shall be required to make a written report of all irregularities and illegal acts or

indications of illegal acts of which they become aware to the ERS Board.

Additional Services

Should the Board decide to request additional internal audit work outside the agreed upon

schedule, the internal auditor will perform such work at an agreed upon rate and time

schedule.

http://www.cmers.com/


Working Paper Retention and Access to Working Papers

All working papers and reports must be retained, at the Auditor’s expense, for a minimum of

7 years, unless notified in writing from the ERS of the need to extend the retention period.

The Auditor will be required to make working papers available upon request to the ERS.

Available Documents

Attached to this RFI are copies of the Internal Audit Charter, the A&O Audit Charter, the

current contract, and the current audit plan. (See appendixes A, B, C, and D)


Questionnaire

A. Background of the consulting firm (2 page maximum) 1. Briefly describe your firm’s background, history, and ownership structure, including any

parent, affiliated or subsidiary company, and any business partners.

2. Please describe the services your firm provides and give the percentage of revenue derived from internal audit services, as well as the main market/customers you serve.

3. Provide an organization chart of your firm and describe the relationship between each

component and your consulting group. 4. Within the past three years, have there been any significant developments in your

organization such as changes in ownership, restructuring, or personnel reorganizations? Do you anticipate future significant changes in your organization?

5. Please give the address of your corporate office and indicate which office(s) will service

the ERS. 6. Identify any services you are unable to perform.

B. Consultants (1 page maximum): 1. How many internal audit consultants does your firm have?

2. Will one primary contact be assigend to our account? If so, provide complete contact

informations.

C. Standards of conduct (1 page maximum): 1. Does your firm have a written code of conduct or a set of standards for professional

behavior? If so, how are they monitored and enforced?

2. What is your firm’s philosophy regarding quality? Define your quality review process. 3. Describe your procedures for monitoring client satisfaction. 4. Within the last five years, has your organization or an officer or principal been involved

in litigation or other legal proceedings relating to your internal audit services assignments? If so, please provide an explanation and indicate the current status or disposition.

5. Has your firm ever been censured by any regulatory body? If so, please describe the

situation.

D. Conflicts of Interest (3 page maximum): 1. Are there any potential conflict of interest issues your firm would have in servicing the

ERS? If so, describe them.

2. How does your firm identify and manage conflicts of interest?


3. Have you or anyone in your firm provided any gifts, travel and room expenses, entertainment or meals to any ERS Board member or staff during the past 12 months? If yes, please describe the amount of expenses and what it was for.

E. Consulting team (2 page maximum): 1. Please provide contact information for each consultant that will be assigned to the ERS

in a grid similar to this.

Name Address Business

Phone

Business

Fax

E-mail Address

2. Please describe the role of each consultant for this assignment.

3. Please describe your team’s experience with similar work performed for other public retirement systems or corporate pension.

4. State whether the individuals assigned to the work have any responsibilities other than

providing internal audit services, and if so, specify such responsibilities. 5. Describe your firm’s backup procedures in the event that key personnel in this

assignment should leave the firm. 6. Describe the resources your firm has that specifically address the needs of public

sector clients. 7. Describe how your firm controls the cost of services rendered for a client.

F. Unique qualifications (2 page maximum): 1. Describe how your internal audit consulting work is distinguished from that of your

competitors.

2. Describe any services of your organization that may not be offered by other consultants.

G. References: Please provide three references who are clients for whom work similar to that requested in

this RFI has been performed.

H. Previous clients: Please list public sector clients who have terminated your actuarial relationship during the

past three years and their reasons for doing so. Please include their names, titles and

telephone numbers.


I. Subcontracting: 1. If your firm uses the services of a subcontractor, please identify the subcontractor and

describe the skills and qualifications of the subcontractor and its individual employees.

2. Describe what portions of the project will be assigned to the subcontractor. 3. Identify the cost associated with the portions of the project assigned to the

subcontractor. 4. Describe the inclusive periods and percentage of time the subcontractor will devote to

the project. 5. Describe the contractual arrangement contemplated with each subcontractor and

describe generally the control/delegation of responsibilities anticipated in that arrangement.

J. Fees: Please list your fees for internal audit services, assuming this will be a three year contract.

Please give hourly rates you will charge for work within the scope of services for which the

precise number of hours is unknown.


Appendix A

Internal Audit Charter


Employes’ Retirement System of the City of Milwaukee

Internal Audit Charter

May 2014 Purpose The purpose of this Internal Audit Charter dated May 2014, is to assist the internal auditors in fulfilling their mission and fiduciary responsibilities under the oversight of the Administration and Operations (A&O) Committee. The provisions of this charter apply to the activities of the Employes’ Retirement System (ERS) of the City of Milwaukee Internal Audit function only, and should be used for no other purpose. This document includes the following topics.

I. MISSION II. OBJECTIVES & SCOPE III. INDEPENDENCE IV. AUTHORITY V. ACCESS VI. RESPONSIBILITIES & ACCOUNTABILITY VII. PROFESSIONAL STANDARDS VIII. REPORT DISTRIBUTION & FOLLOW-UP IX. RELATIONSHIP TO PREVENTION, DETECTION & CORRECTION

ACTIVITIES X. SIGNATURE SECTION

I. MISSION The mission of Internal Audit is to provide independent, objective assurance and consulting services designed to add value and improve the operations of ERS. It assists the Board and the Executive Director in accomplishing their oversight responsibilities by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, internal control, and governance processes. The following are specific tasks to be carried out by Internal Audit to accomplish the mission: ● Supporting the agency’s efforts to achieve its objectives through conducting a risk

assessment every three years, designing, reviewing and executing an annual audit plan, and providing a wide range of quality independent internal auditing services.

● Assessing the integrity, quality, and efficiency of the systems of internal control. ● Assessing the degree to which ERS complies with various policies, procedures, laws, and

regulations in a manner that facilitates operational efficiency, quality of service, and fiduciary responsibility.

● Examining and testing the performance of important control elements. ● Assessing the integrity of the financial reporting processes.


● Communicating results of audit projects through timely written reports delivered to the

Board, the Executive Director, and management identified as stakeholders. ● Assessing through follow-up audit projects the degree to which management action

plans created in response to recommendations in audit reports are carried out effectively and timely.

II. OBJECTIVES & SCOPE Auditing Objectives. The objectives of the auditing services are to provide independent assurance to the A&O Committee and management that ERS’ assets are safeguarded, operating efficiency is enhanced, and compliance is maintained with prescribed laws and regulations and Board and management policies. These objectives of auditing services include an independent assessment of the agency’s risk awareness, reliability and integrity of the organization’s data and information, and achievement of the agency’s goals and objectives. Consulting and Advisory Objectives. The objectives of internal audit’s consulting and advisory services are to provide ERS management with recommendations for improving processes that will advance the goals and objective to successfully achieve the overall mission of the organization. The objectives will also allow internal audit the opportunity to follow-up with management to ensure action steps were taken to mitigate the risk. Scope. The scope of work of internal audit is to determine whether the agency’s network of risk management, internal control, and governance processes, as designed and represented by management, are adequate and functioning in a manner to ensure: ● Programs are operating within the highest fiduciary standards and are in compliance

with the requirements defined in the Federal and State constitutions, laws, and regulations, local government ordinances and rules, and the policies and procedures of the agency.

● Programs and processes are in synchrony with industry best practices, using the best public and private examples and all resources available as benchmarks.

● Significant legislative or regulatory issues impacting the agency are recognized and addressed appropriately and timely.

● Operations, processes and programs are consistent with established missions, objectives and goals and they are being executed in accordance with management’s plan.

● Existing policies and procedures are appropriate and updated.

● Internal and external risks are identified and managed.

● Employers appropriately enroll employees, accurately report member earnings, and appropriately report other employee data.

● Interaction with appropriate governance groups occurs as needed.

● Significant financial, managerial, and operating information is accurate, reliable, and timely.

● Resources are acquired economically, used efficiently, and adequately protected.

● Quality service and continuous improvement are fostered in the organization’s control process.


● Contractors, including third-party administrators, are meeting the objectives of the contracts, while in conformance with applicable laws, regulations, policies, procedures and best practices and the agency’s contract monitoring process is effective to ensure minimal risk.

● Responsibilities and activities of the external financial statement auditors are coordinated with those of the internal auditors in order to provide continuity of audit efforts and to avoid duplication.

● Access for auditors is provided as appropriate.

● Specific operations, processes or programs are reviewed at the request of the A&O Committee, the Board, and management.

Opportunities for improving member service, management of risks, internal control, governance, cost benefit, and the organization’s effectiveness and image may be identified during audits. This information will be communicated to the A&O Committee and to appropriate levels of management. III. INDEPENDENCE Independent Professional Standards. The A&O Committee recognizes that professional independence requires the auditors have knowledge of operations and appropriate expertise in the subject matter that is being audited. Internal Audit must provide the credentials of any or all staff members upon request of the A&O Committee. Conflict of Interest. Internal Audit shall discuss any potential issues regarding impairment of independence and/or conflicts of interest and their mitigation(s) with the A&O Committee as necessary. IV. AUTHORITY The Internal Audit function is established by the Board of this agency and governed by the A&O Committee. This Charter is approved and all future amendments to it are to be approved by the A&O Committee through a majority vote. This Charter shall be reviewed at least annually and updated as required by the A&O Committee. Internal Audit functionally reports to the A&O Committee. Meetings are held with the A and O Committee on a quarterly basis. The portion of the A&O Committee agenda regarding Internal Audit generally include:

● A discussion of current year Plan status ● Points of emphasis of audit reports issued in the quarter ● Status of audits in process ● Changes or proposed changes to the Plan ● Audit follow-up status reports as necessary (based on exceptions noted)

● Special requests for audits from the Board or from Management with Board approval

● Closed sessions, when necessary, and provided for under the Wisconsin open meetings law

The A&O Committee retains the right to provide input and approve the annual audit plan presented by Internal Audit. The risk assessment and Plan are discussed in the meeting at the end of the quarter in which they are completed. Internal Audit shall inform the A and O


Committee of the status of the audit plan and any changes needed. Management may request special audits outside of the plan to be conducted, which must be approved by the A&O Committee. The mission, responsibilities, and workings of the A&O Committee are described in the committee charter. Internal Audit staff is not authorized to initiate or approve accounting transactions external to those related to the function. Internal Audit staff is not authorized to direct the activities of any agency employee not employed by the function, except to the extent such employees have been appropriately assigned to auditing teams or to otherwise assist the internal auditors. V. ACCESS The Internal Audit staff, as appropriate, are granted authority for full, free and unrestricted access to all of the agency’s functions, records, files and information systems, personnel, contractors, external auditors, physical properties, rental locations, and any other item relevant to the function, process or department under review. All contracts with vendors shall contain standard audit language enabling the internal auditors and other auditors and specialists to have access to relevant records and information. Documents and information given to Internal Audit shall be handled in the same prudent and confidential manner as by those employees normally accountable for them. All of the ERS employees are required to assist the staff of Internal Audit in fulfilling their audit functions and fiduciary duties. VI. RESPONSIBILITIES & ACCOUNTABILITY Internal Audit is responsible for the following in order to meet the mission, objectives and scope of this Charter:

1. Establish policies for conducting Internal Audit activities and directing its technical and administrative functions according to the agency’s policies and direction provided by the A&O Committee and professional standards described in Section VIII.

2. Perform a risk-assessment every three years and review the flexible annual audit plan that will accomplish the mission, objectives and scope of this Charter. This plan will include some unassigned hours in order to provide flexibility for changing conditions. This plan shall in part be based upon risks and control concerns identified by management.

3. Facilitate the implementation of the audit plan.

4. Implement the annual audit plan, as approved, including, as appropriate, any plan amendments, special tasks or projects requested by management, the Board and the A&O Committee.

5. Obtain updates to follow-up on management action plans as they relate to the recommendations provided by Internal Audit for improvement to ensure the risks are being mitigated timely.

6. Transmit copies of all audit reports and management letters to the A&O Committee.

7. Assess periodically whether the purpose, authority and responsibility, as defined in this Charter, continue to be adequate to accomplish its mission, objectives and scope. The result of this periodic assessment should be communicated to the A&O Committee.


8. Assist in the investigation of significant suspected fraudulent activities within the organization and notify the A&O Committee, the Board and other Executives, as appropriate, of the results.

VII. PROFESSIONAL STANDARDS Internal Audit shall follow the professional standards of relevant professional organizations. These professional standards include, but are not limited to, the following:

● Institute of Internal Auditors (IIA) Professional Standards and Code of Ethics

● American Institute of Certified Public Accountants (AICPA) Professional Standards and Code of Ethics, as applicable

● Generally Accepted Government Auditing Standards (GAGAS) from the United States General Accounting Office (GAO), as applicable

VIII. REPORT DISTRIBUTION & FOLLOW-UP Draft audit reports are first distributed to the Executive Director or their designee for comments. After comment, they are then distributed to the applicable department head. Internal Audit is responsible for obtaining management responses and issuing the final version of the audit report according to the following time schedule:

● Once a draft report is issued to a department head, 15 business days are allowed for management responses to be prepared and forwarded to Internal Audit. Internal Audit may extend the deadline, though the maximum number of business days for a response will be 25 days.

● Upon receipt of acceptable management responses, Internal Audit has 10 business days to issue the final version of the report.

● In cases where the department under review does not meet the above schedule, Internal Audit has the authority to issue the report without management responses to the chairman of the A&O Committee.

Final audit reports are distributed as follows:

● The department head, under review, receives a complete copy of the full report.

● The Executive Director, the Board, and the A&O Committee also receive a copy of the full report.


IX. RELATIONSHIP TO PREVENTION, DETECTION AND CORRECTION ACTIVITIES Internal Audit strives to participate in the initial stages of major agency-wide projects so that risks can be appropriately managed and internal controls instituted in the design phase in order to prevent problems and minimize the associated costs. It recognizes that it is more expensive to detect and correct problems than it is to prevent them in the initial stages of a project. X. SIGNATURE SECTION The A&O Committee reviewed and adopted this Internal Audit Charter in May 20012, and transmitted it to the Board. The Internal Audit Charter is effective immediately and is hereby signed by the following persons who have authority and responsibilities under this Charter. _____________________________________ __________________________ Chair, A&O Committee Date _____________________________________ __________________________ Chairman, ERS Board Date _____________________________________ __________________________ Executive Director Date


Appendix B

A&O Audit Charter


Employes’ Retirement System of the City of Milwaukee

Administration & Operations Committee Audit Charter

May 2014

Purpose The purpose of this Administration and Operations (A&O) Committee Audit Charter dated May 2014 is to assist the Board Members in fulfilling their oversight responsibilities for the financial reporting process, the system of internal control, the audit process, and the agency’s process for monitoring compliance with laws and regulations and the code of conduct. Because of the existing member composition of the A&O Committee as well as the limited number of members, this committee will also have responsibility for the Internal Audit function.

I. AUTHORITY II. RESPONSIBILITIES

(1) Financial Statements (2) System of Risk Management (3) Internal Control (4) Internal Audit (5) External Audit of the Financial Statements (6) Agency’s Processes for Monitoring Compliance (7) Special Investigations and Whistleblower Mechanism (8) A&O Committee Management and Reporting Responsibilities

III. MEETINGS I. AUTHORITY The A&O Committee has authority to request the Board to conduct or authorize investigation in to any matters within its scope of responsibility. It is empowered to: ● Recommend independent auditors to be engaged by the agency, review and approve the

planned and budgeted fees of the independent auditors, review and evaluate the performance of the independent auditors and obtain Board approval for any proposed discharge of the independent auditors.

● Pre-approve all auditing and non-audit services.

● Resolve any disagreements between management and the audit team encountered during the course of the audit including any restrictions on the scope of the work or access to required information.

● Retain independent accountants, or others to advise the A&O Committee or assist in the conduct of an investigation as necessary.

● Seek any information required from employees, all of who are directed to cooperate with the committee’s requests.


II. RESPONSIBILITIES The committee will oversee the following responsibilities: (1) Financial Statements

● Review significant accounting and reporting issues, including complex or unusual transactions, highly judgmental areas, and recent professional and regulatory pronouncements, and understand their impact on the financial statements.

● Review with management and the external auditors the results of the external audit, including any difficulties encountered.

● Review the annual financial statements and consider whether they are complete, consistent with information known to committee members and reflect appropriate accounting principles.

● Review with the City Attorney or outside legal counsel the status of legal matters that may have an effect on the financial statements.

● Review with management and the external auditors all matters required to be communicated to the committee under generally accepted auditing Standards.

● Understand how management develops interim financial information, and the nature and extent of external and internal auditor involvement.

● Review interim financial reports with management and the external auditors and consider whether they are complete and consistent with the information known to committee members.

(2) System of Risk Management

● Ensure that the organization has a comprehensive policy on risk management.

● Consider the effectiveness of the organization’s risk management system, including risks of information technology systems.

● Consider the risks of business relationships with significant vendors and consultants.

● Review reports on management’s self-assessment of risks and the mitigations of these risks.

● Understand the scope of the internal auditor’s review of risk management over financial reporting and internal controls and obtain reports on significant findings and recommendations with management’s responses.

● Hire outside experts and consultants in risk management as necessary.

(3) Internal Control ● Consider the effectiveness of the organization’s internal control system, including

information technology security and control.

● Understand the scope of internal auditor’s and external auditor’s review of internal control over financial reporting and its processes and obtain reports on significant findings and recommendations with management’s responses.

● Ensure that the organization has a comprehensive policy on internal control and compliance and periodically review the policies on ethics, the code of conduct and fraud.


● Review the role of the internal auditor’s involvement in the corporate governance process, including corporate governance documentation and training.

● Ensure that contracts with external service providers contain appropriate record-keeping and audit language.

(4) Internal Audit

● Assure and maintain through the organizational structure of the agency and by other means, the independence of the internal audit process. Review with management the department charter, objectives, plans, activities, staffing, budget, qualifications, and organizational structure of the internal audit function.

● Obtain the information and training needed to enhance the committee members’ understanding of the purpose of internal audits so that the committee may adequately oversee the internal audit function.

● Ensure there are no unjustified restrictions or limitations placed on Internal Audit and internal audit staff. Ensure that internal auditors have access to all documents, information and systems in the organization.

● Receive and review all internal audit reports and management letters. Review any changes in the scope of their internal audit. Review the responsiveness and timeliness of management’s follow-up activities pertaining to any reported findings and recommendations.

● Review the performance of Internal Audit periodically.

(5) External Audit of the Financial Statements ● Review the external auditor’s proposed audit scope and approach, including

coordination of audit effort with internal audit. Pre-approve all services to be performed by the external financial statement auditor.

● Review the independence of the external financial statement audit firm by obtaining statements from the auditors on relationships between the audit firm and the organization, including any non-audit services, and discussing these relationships with the audit firm. Obtain from management a listing of all services provided by the external audit firm.

● Review the performance of the external financial statement audit firm.

● Exercise final approval on the request for proposal, the appointment, and retention or discharge of the audit firm.

● Review and approve the audited financial statements, associated management letter, attestation on the effectiveness of the internal control system and procedures for financial reporting, other required auditor communications, and all other auditor reports and communications relating to the financial statements.

● Define the services that the external financial statement auditor is allowed to perform and the services that are prohibited. Ensure production of a report of all costs of and payments to the external financial statement auditor. The listing should separately disclose the costs of the financial statement audit, other attest projects, agreed-upon-procedures and any non-audit services provided.


(6) Agency’s Processes for Monitoring Regulatory Compliance ● Review the effectiveness of the system for monitoring compliance with laws and

regulations and the results of management’s investigation and follow-up (including disciplinary action) of any instance of noncompliance.

● Review the findings of any examinations by regulatory agencies and any auditor observations, including investigations of misconduct and fraud.

● Review the process for communicating to all affected parties the ethics policy, code of conduct and fraud policy to agency personnel and for monitoring compliance.

● Obtain regular updates from management and organization legal counsel regarding compliance matters.

● Monitor changes and proposed changes in laws, regulations and rules affecting the agency.

(7) Special Investigations and Whistleblower Mechanism

● Institute and oversee special investigations as needed.

● Provide an appropriate confidential mechanism for whistleblowers to provide information on potentially fraudulent financial reporting or breaches of internal control to the A&O Committee, City Comptroller’s Audit Division-Audit Hotline or City of Milwaukee Ethics Board.

(8) A&O Committee Management and Reporting Responsibilities

● Provide an open avenue of communication between internal audit, the external financial statement auditors, other external auditors, and management Board members.

● Confirm annually that all responsibilities outlined in this charter have been carried out and review the charter on an annual basis to determine updates.

● Report annually to the Board, members, retirees and beneficiaries describing the committee’s composition, responsibilities and how they were discharged and any other pertinent information, including approval of non-audit services and proposed changes and ensure appropriate disclosure as may be required by law or regulation.

● Evaluate the committee’s and individual member’s performance on a regular basis and report to the Board.

III. MEETINGS The A&O Committee will meet at least four times a year on a quarterly basis. All committee members are expected to attend each meeting. The agendas for meetings should be prepared and provided to members in advance, along with appropriate briefing materials. The committee may invite members of management or others to attend meetings and provide pertinent information as necessary. Minutes will be prepared by and filed with the Board members.


Appendix C

Current Contract


CONTRACT FOR SERVICES

[CONTRACTOR NAME]

[POSITION]

For the Employes’ Retirement System of the City of Milwaukee

SERVICE DESCRIPTION (General): [ ]

TIME OF PERFORMANCE: __________________________________

TOTAL AMOUNT OF SERVICES: Maximum Amount of Compensation Not to Exceed

______________________

THIS AGREEMENT, entered into by and between [CONTRACTOR NAME] (hereinafter referred to as the "CONTRACTOR"),

and the Employes’ Retirement System of the City of Milwaukee, a body corporate and politic under the laws of the State of Wisconsin

(hereinafter referred to as the “ERS”),

Performance and schedules will be approved by the Executive Director of the Employes’ Retirement System, or designee, subject to the

terms of performance and acceptance herein.

The following constitute the Contract documents. If there is a conflict or ambiguity, the Contract shall be governed by these listed

documents in descending order of precedence.

A. This Contract for Services; and

B. Statement of Work (Exhibit A)

C. Confidentiality Agreement (Exhibit B)

D. Pledge of Confidentiality (Exhibit C)

Work may commence in accordance with the terms and conditions of this Contract after the CONTRACTOR has executed the Contract,

and (a) been notified in writing to commence the Performance of Services, or (b) received from the ERS an original of the Contract that is

complete and fully executed.

WHEREAS, THE CONTRACTOR represents self as being capable, experienced and qualified to undertake and perform those

certain services, as hereinafter set forth, as are required in accomplishing fulfillment of the obligations under the terms and

conditions of this Contract as an independent entrepreneur and not as an employee of the ERS.

NOW, THEREFORE, the parties hereto do mutually agree as follows:

I. RETENTION OF SERVICES. The ERS hereby agrees to engage the CONTRACTOR and the CONTRACTOR hereby agrees to

personally perform, as an independent contractor and not as an employee of the ERS, the services hereinafter set forth, all in

accordance with the terms and conditions of this Contract. CONTRACTOR agrees time is of the essence and will meet all

deadlines and any schedules as herein set forth.

II. REQUIREMENTS. The CONTRACTOR is required to

A. do, perform, and carry out in a satisfactory, timely, and proper manner, the services delineated in this contract.

B. Comply with requirements listed with respect to reporting on progress of the services, additional approvals required, and

other matters relating to the performance of the services.


C. Comply with time schedules and payment terms.

The provisions of this contract have been approved by the Office of the City Attorney

III. SCOPE OF SERVICES. (To include specific duties and responsibilities, time schedules and deadlines, compensation, terms, and

approval requirements.) As per the Statement of Work.

CONTINUATION OF THIS CONTRACT BEYOND DECEMBER 31 OF ANY YEAR IS CONTINGENT UPON THE

APPROPRIATION OF SUFFICIENT FUNDS BY THE PROPER CITY OFFICIALS.

IV. SPECIFIC CONDITIONS OF PAYMENT: Payment will be made to the following schedules if completion is satisfactory.

UPON RECEIPT OF A PROPERLY SUBMITTED AND APPROVED INVOICE, CONTRACTOR SHALL BE COMPENSATED

AT A RATE NOT TO EXCEED $105.00 PER HOUR FOR HOURS ACTUALLY WORKED. EXPENSES ARE EXCLUDED

HEREUNDER. TOTAL COMPENSATION SHALL NOT EXCEED $210,000.00.

THE ERS STRIVES TO MAKE TIMELY PAYMENT ON ALL INVOICES. PAYMENT TO THE CONTRACTOR WILL BE

DEEMED TIMELY IF THE PAYMENT IS MAILED, DELIVERED, OR TRANSFERRED WITHIN 60 CALENDAR DAYS AFTER

RECEIPT OF A PROPERLY COMPLETED INVOICE OR RECEIPT AND ACCEPTANCE OF THE PROPERTY OR SERVICE

UNDER THE ORDER OR CONTRACT, WHICHEVER IS LATER. IF THE ERS DOES NOT MAKE PAYMENT BY THE 45TH

CALENDAR DAY, THE ERS SHALL PAY SIMPLE INTEREST BEGINNING WITH THE 31ST CALENDAR DAY AT THE RATE

OF1% PER MONTH (UNLESS THE ERS DISPUTES THE AMOUNT OF THE INVOICE). REFERENCE COMMON COUNCIL

FILE NO.101137 ADOPTED JANUARY 19, 2011, PROVISIONS OF STATE STATUTE 66.0135.

V. NOTICES: Any and all notices shall be in writing and deemed served upon depositing same with the United States Postal Services

as "Certified Mail, Return Receipt Requested," addressed to the CONTRACTOR at:

[CONTRACTOR]

ADDRESS_______________

Attention: ________________

and to the ERS at:

EMPLOYES’ RETIREMENT SYSTEM

789 N Water Street, Suite 300

MILWAUKEE, WISCONSIN 53202

Attention: Bernard J. Allen, Executive Director

All other correspondence shall be addressed as above, but may be sent "Regular Mail" and deemed delivered upon receipt by the

addressee.

VI. REPORTS

A. The CONTRACTOR agrees to submit reports as may be required by the ERS at such times as may be scheduled for

submittal, unless otherwise agreed to in writing.

B. All reports, studies, analysis, memoranda and related data and material as may be developed during the performance of

this Contract shall be submitted to and be the exclusive property of the ERS, which shall have the right to use same for

any purpose without any further compensation to the CONTRACTOR other than hereinafter provided. All of the

aforesaid documents and materials prepared or assembled by the CONTRACTOR under this Contract are confidential

and the CONTRACTOR agrees that it will not, without prior written approval by the ERS, submit or make same

available to any individual, agency, public body or organization other than the ERS, except as may be otherwise herein

provided.

VII. TIME OF PERFORMANCE. The services to be performed under the terms and conditions of this Contract shall be in force and

shall commence upon execution of this Agreement by the CONTRACTOR and upon written notice from the ERS to proceed, or

when the CONTRACTOR has received an original of the Contract which is complete and fully executed, and shall be undertaken

and completed in such sequence as to assure its expeditious completion in the light of the purposes of this Contract, but in any event

all of the services required hereunder shall be completed as indicated on page 1 under "Time of Performance," which is the

termination date of this Contract. In addition to all other remedies inuring to the ERS should the Contract not be completed by the

date specified in accordance with all of its terms, requirements and conditions therein set forth, the CONTRACTOR shall continue

to be obligated thereafter to fulfill CONTRACTOR's responsibility to complete the scope of services and to execute any necessary

amendments to this CONTRACT.


VIII. CONDITIONS OF PERFORMANCE AND COMPENSATION.

A. Performance. Notwithstanding any references to the contrary in the contract documents, the

CONTRACTOR agrees that the performance of CONTRACTOR’s work, services and the results therefrom, pursuant to

the terms, conditions and agreements of this Contract, shall conform to such recognized high professional standards as

are prevalent in this field of endeavor and like services.

B. Place of Performance. The CONTRACTOR shall conduct CONTRACTOR's services as required under the terms and

conditions of this Contract at such place or places as is necessary so as to enable the CONTRACTOR to fulfill

CONTRACTOR's obligations under this Contract.

C. Compensation. The ERS agrees to pay, subject to the contingencies herein, and the CONTRACTOR agrees to accept for

the satisfactory performance of the services under this Contract the maximum as indicated on page 1 under "Total

Amount of Contract," inclusive of all expenses, it being expressly understood and agreed that in no event will the total

compensation to be paid hereunder exceed the maximum sum for all of the services required.

D. Additional Fringe or Employee Benefits. The CONTRACTOR shall not receive nor be eligible for any fringe benefits or

any other benefits to which ERS salaried employees are entitled to or are receiving.

E. Taxes, Social Security, Insurance, and Government Reporting. Personal income tax payments, social

security contributions, insurance, and all other governmental reporting and contributions required as a consequence of

the CONTRACTOR receiving payment under this Contract shall be the sole responsibility of the CONTRACTOR.

Insurance requirements are set forth in Article XI.

The CONTRACTOR shall be solely responsible to meet CONTRACTOR's insurance needs as required by the ERS

during the terms of this Contract or any extension thereof. A Certificate of Insurance shall be provided to the ERS as an

additional insured providing for a 60day notice to the ERS prior to change, termination or cancellation.

F. Subcontracting. The CONTRACTOR shall not subcontract for the performance of any of the services herein set forth

without prior written approval obtained from the ERS Executive Director.

IX. METHOD OF PAYMENT. The ERS agrees that subsequent to the full and complete performance of this Contract and satisfactory

performance of the services in accordance with the "work schedules" set forth herein it will pay the amount or amounts as

hereinafter set forth. In the event of a dispute as to the services performed or the compensation to be paid, the decision of the ERS

Executive Director or its designee shall prevail. The conditions of payment are as follows: Compensation for services required

under this Contract shall be contingent upon each activity being reviewed for approval by the ERS approving officer designated on

page 1 and approved by them for payment (as referenced and stipulated on page 2, IV Specific Conditions of Payment).

X. DEFENSE OF SUITS. In case any action in court or proceeding before an administrative agency is brought against the ERS or any

of its officers, agents, or employees for the failure or neglect of the CONTRACTOR in whole or in part to perform any of the

covenants, acts, matters or things by this Contract undertaken, or for injury or damage caused by the alleged and/or actual

negligence of the CONTRACTOR, its officers, agents or employees, the CONTRACTOR shall indemnify and save harmless the

ERS and its officers, agents and employees from all losses, damages, costs, expenses, judgments, or decrees arising out of such

action. The ERS shall tender the defense of any claim or action at law or in equity to the CONTRACTOR or CONTRACTOR's

insurer, and upon such tender it shall be the duty of the CONTRACTOR and CONTRACTOR's insurer to defend such claim or

action without cost or expense to the ERS or its officers, agents, or employees. The CONTRACTOR shall be solely responsible for

the conduct and performance of the services required under the terms and conditions of this Contract and for the results

therefrom.

XI. INSURANCE

A. General Requirements

The CONTRACTOR will secure and maintain throughout the duration of the Contract, insurance of such types and in

such amounts as may be necessary to protect itself and the interests of the ERS against all hazards or risks of loss as

hereafter specified.

1. The form and limits of such insurance, together with the underwriter thereof in each case, will be required to be

acceptable to the ERS; but regardless of any ERS review, it will be the responsibility of the CONTRACTOR to maintain

adequate insurance coverage at all times.

2. Failure of the CONTRACTOR to maintain adequate coverage will not relieve it of any contract responsibility or

obligation.

3. All policies are to contain notice requirements that ensure that 60 days advance written notice will be provided to the


ERS prior to cancellation/ renewal or alteration of terms and conditions of the policies.

4. Insurers which provide the insurance coverage referenced in Section V are to have an A.M. Best rating of no less

than A/VIII. The successful bidder will provide immediate written notice to the ERS if there is any change in the A.M.

Best rating of any insurer.

5. Certificates of Insurance for all of the coverage limits referenced herein must be provided prior to the effective date

of the Contract and for each year that the Contract is in effect.

6. It will be the responsibility of the prime CONTRACTOR to ensure that all subcontractors comply with all insurance

and bonding requirements.

7. All policies other than Workers Compensation/ Employers Liability, Professional Liability, Crime and Cyber

Risk/Network Security are to include the Employes’ Retirement System of the City of Milwaukee, the Annuity and

Pension Board, their staffs, present and former employees, officers, directors, agents and representatives as additional

insureds. The additional insured status should be shown on the Certificates of Insurance.

8. No payments or disbursements under the Contract shall be made until satisfactory evidence that compliance with the

insurance requirements described in this section has been provided.

B. Commercial Automobile Liability

This insurance will be written in commercial form and will protect the CONTRACTOR and the ERS against all claims for injuries

to members of the public and damage to property of others arising from the CONTRACTOR’s use of motor vehicles and will cover

operation on or off the site of all motor vehicles licensed for highway use whether they are owned, non-owned or hired. The

liability limits will not be less than the following:

Bodily Injury/Property Damage per occurrence: $1,000,000

Uninsured Motorists/Underinsured Motorists protection per occurrence:

$1,000,000

C. Commercial General Liability

This insurance will be written on a commercial general liability form which will protect the CONTRACTOR and the ERS for those

sums the CONTRACTOR becomes legally obligated to pay as damages because of bodily injury, personal injury or property

damage.

The insurance will include:

1. Commercial General Liability Insuring Agreement that provides occurrence coverage.

2. Contractual Liability Coverage as provided under a Commercial General Liability policy.

3. CONTRACTOR will certify that the policy be renewed each year of the Contract.

The limits applicable to the commercial general liability policy will not be less than the following:

BODILY INJURY AND PROPERTY DAMAGE – COMBINED SINGLE LIMIT

Each Occurrence $1,000,000

General Aggregate - Other than Products/Completed Operations $1,000,000

Products/Completed Operations Aggregate $1,000,000

Personal Injury $1,000,000

D. Professional Liability (Errors and Omissions)

The limits applicable to the professional liability policy will not be less than the following:

Wrongful Act Limits

Each incident $1,000,000

Aggregate $1,000,000

If coverage is provided in a claims-made form, the CONTRACTOR will ensure that the retroactive date will not change during the

duration of the Contract or at any renewal date. Contractor must warrant evidence of professional liability coverage for three


years after termination of the Agreement. This would be either in the form of an ongoing policy or, as an alternative, an extended

reporting period/tail. Contractor must contribute to provide evidence of this coverage annually in the form of a Certificate of

Insurance for three years after termination of this contract.

Coverage is to be provided on a “per project” basis or, if not available for reasonable cost, a higher policy aggregate limit may be

required by the ERS. Any request for modification to this requirement should be submitted in writing to the ERS and the ERS’

Risk Management Consultant for consideration.

CONTRACTOR will certify that the policy will be renewed each year of the Contract.

E. Crime Coverage

Crime Coverage Limits

Computer Fraud $1,000,000

Employee Theft—Blanket (must apply to theft of ERS assets by employees of the Contractor) $1,000,000

Forgery or Alteration $1,000,000

Funds Transfer Fraud $1,000,000

Outside the Premises $100,000

Inside the Premises Theft of Money and Securities $100,000

F. Workers’ Compensation Insurance

The CONTRACTOR, and all contractors, if any, shall provide to the ERS an affidavit or other satisfactory proof, such as a

Certificate of Insurance, which the ERS may require evidencing that the CONTRACTOR and all subcontractors have obtained

Worker's Compensation Insurance for all persons performing any work or services under this Contract.

Workers Compensation Statutory

Employer Liability

Bodily Injury by Accident Each Accident

$100,000

Bodily Injury by Disease Each Employee

$100,000

Policy Limit

$500,000

G. Self Insurance

Any request for self-insurance must be submitted in writing to the ERS and the ERS’ Risk Management Consultant for

consideration.

H. Cyber Risk/Network Security Insurance

Per loss $1,000,000

Coverage must include third party loss due to identity theft or unlawful disclosure of confidential information.

XII. INDEMNIFICATION. Notwithstanding any references to the contrary in the contract documents, CONTRACTOR assumes full

liability for all of its acts in the performance of this contract. CONTRACTOR will save and indemnify and keep harmless the

Employes’ Retirement System of the City of Milwaukee, the Annuity and Pension Board, their staffs, present and former

employees, officers and directors, agents and representatives against all liabilities, judgments, costs, and expenses which may be

claimed against the ERS in consequence of the granting of this contract to said CONTRACTOR, or which may result from

negligence and/or willful acts of said CONTRACTOR, or the agents, employees or workmen of said CONTRACTOR in any respect

whatever. If judgment is recovered, whether in suits of law or in equity, against the ERS by reason of the negligence and/or willful

acts or by acts of omission of the CONTRACTOR, such persons, firms or corporations carrying out the provisions of the contract

for the CONTRACTOR, the CONTRACTOR assumes full liability for such judgment not only as to the amount of damages, but

also the cost, attorneys fees or other expenses resulting therefrom.

XIII. REGULATIONS. Contractor agrees to comply with all of the requirements of all federal, state and local laws related thereto.

XIV. TERMINATION OF CONTRACT FOR CAUSE. If, through any cause, the CONTRACTOR shall fail to fulfill in timely and

proper manner its obligations under this Contract, or if the CONTRACTOR shall violate any of the covenants, agreements, or

stipulations of this Contract, the ERS Executive Director shall thereupon have the right to terminate this Contract by giving

written notice to the CONTRACTOR of such termination and specifying the effective date thereof, at least five days before the

effective date of the termination. In such event, all finished or unfinished documents, data, studies, surveys, drawings, maps,

models, photographs, reports, or other materials related to the services prepared by the CONTRACTOR under this Contract shall,

at the option of the ERS, become the property of the ERS.


Notwithstanding the above, the CONTRACTOR shall not be relieved of liability to the ERS for damages sustained by the ERS by

virtue of any breach of the CONTRACT by the CONTRACTOR, and the ERS may withhold any payments to the CONTRACTOR

for the purpose of set off until such time as the exact amount of damages due to the ERS from the CONTRACTOR is determined.

XV. TERMINATION FOR CONVENIENCE OF THE ERS. The ERS may terminate this Contract at any time for any reason by giving

at least ten days' notice in writing from the ERS Executive Director to the CONTRACTOR. If the CONTRACTOR is terminated

by the ERS as provided herein, the CONTRACTOR will be paid an amount which bears the same ratio to the total compensation

as the services actually and satisfactorily performed bear to the total services of the CONTRACTOR covered by this Contract, less

payments for such services as were previously made. Provided, however, that if less than 60% of the services covered by this

Contract have been performed upon the effective date of such termination the CONTRACTOR shall be reimbursed (in addition to

the above payment) for that portion of the actual out-of-pocket expenses (not otherwise reimbursed under the Contract) incurred

by the CONTRACTOR during the Contract period which are directly attributable to the uncompleted portion of the services

covered by this Contract. If this Contract is terminated due to the fault of the CONTRACTOR, Paragraph XIV hereof, relative to

termination, shall apply.

XVI. CHANGES. The ERS Executive Director may, from time to time, request changes in the scope of services of the CONTRACTOR

to be performed hereunder. Such changes, including any increase or decrease in the amount of CONTRACTOR's compensation

which are mutually agreed upon by and between the ERS and the CONTRACTOR, shall be incorporated in written amendments

to the Contract.

XVII. PERSONNEL

A. The CONTRACTOR represents that it has or will secure at its own expense all personnel required in performing the

services under this Contract. Such personnel shall not be employees of or have any contractual relationship with the ERS.

B. All of the services required hereunder will be performed by the CONTRACTOR or under their supervision and all

personnel engaged in the work shall be fully qualified and shall be authorized or permitted under state and local law to

perform such services.

C. None of the work or services covered by this Contract shall be subcontracted without the prior written approval of the

ERS Executive Director. If any work or services is subcontracted, it shall be specified by written contract or agreement

and shall be subject to each provision of this Contract. The CONTRACTOR shall be as fully responsible to the ERS for

the acts and omissions of its subcontractors and of persons either directly or indirectly employed by it, as its for the acts

and omissions of persons directly employed by them.

XVIII. ASSIGNABILITY. The CONTRACTOR shall not assign any interest in this Contract and shall not transfer any interest in same

(whether by assignment, novation or any other manner), without the prior written consent of the ERS Executive Director.

Provided, however that claims for money due or to become due the CONTRACTOR from the ERS under this Contract may be

assigned to a bank, trust company or other financial institution without such approval. Notices of any such assignment or transfer

shall be furnished promptly to the ERS Executive Director.

XIX. RECORDS.

A. Establishment and Maintenance of Records. Records shall be maintained in accordance with requirements prescribed by

the ERS with respect to all matters covered by this Contract. Both parties understand that the City is bound by the

Wisconsin Public Records Law, and as such, all of the terms of this Agreement are subject to and conditioned on the

provisions of Wis. Stat. §19.21, et seq. Contractor acknowledges that it is obligated to assist the City in retaining and

producing records that are subject to Wisconsin Public Records Law, and that the failure to do so shall constitute a

material breach of this Agreement, and that the Contractor must defend and hold the City harmless from liability under

that law. Except as otherwise authorized, those records shall be maintained for a period of seven years after receipt of

final payment under this Agreement.

B. Documentation of Costs. All costs shall be supported by property executed payrolls, time records, invoices, contracts or

vouchers, or other official documentation evidencing in proper detail the nature and propriety of other accounting

documents pertaining in whole or in part to this Contract and shall be clearly identified and readily accessible.

C. Notice of Unauthorized Acquisition of Confidential Information. CONTRACTOR shall notify the ERS if it has

knowledge of an unauthorized acquisition of confidential information (as defined in II.A.1-10 of the Confidentiality

Agreement).

XX. REPORT AND INFORMATION. At such times and in such forms as the ERS may require, there shall be furnished the ERS

Executive Director such statements, records, reports, data, and information as the ERS may request pertaining to matters covered

by this Contract.

XXI. AUDITS AND INSPECTIONS. At any time during normal business hours and as often as the ERS, or if federal or state grants or

aids are involved, as the appropriate federal or state agency may deem necessary, there shall be made available to the ERS or such

agency for examination all of its records with respect to all matters covered by this Contract and CONTRACTOR shall permit the

ERS or such agency and/or representatives of the Comptroller General to audit, examine, and make excerpts or transcripts from


such records, and to make audits of all contracts, invoices, materials, payrolls, records of personnel, conditions of employment, and

other data relating to all matters covered by this Contract.

XXII. FINDINGS CONFIDENTIAL. All of the reports, information, data, etc. prepared or assembled by the CONTRACTOR under this

Contract are confidential and the CONTRACTOR agrees that they shall not be made available to any individual or organization,

other than an appropriate agency of the United States Government, without the prior written approval of the ERS Executive

Director. To the extent that confidential information provided by the CONTRACTOR to the ERS is exempt from Wisconsin laws

pertaining to public records, the ERS shall safeguard the CONTRACTOR’s exempted confidential information, to the extent

allowable by Wisconsin law, identified as confidential, to which it has access in connection with the products and/or services

provided under this Contract, and shall use the same means as it uses to protect its own confidential information to prevent the

disclosure and to use such confidential information solely in connection with this Contract. Any confidential information provided

to the CONTRACTOR by the ERS or, developed by the CONTRACTOR based on information provided by the ERS in the

performance of this Contract shall be kept confidential and shall not be made available to any individual or organization by the

CONTRACTOR without the prior written approval of the ERS. Upon termination of this Contract, CONTRACTOR shall deliver

all confidential material of the ERS in its possession to the ERS within thirty (30) business days of such termination.

CONTRACTOR agrees to sign the Confidentiality Agreement (Exhibit B), which designates specific CONTRACTOR personnel as

being authorized to have access to the ERS database containing confidential records (“authorized personnel”), and defines which

individual records of the ERS to be confidential. CONTRACTOR’s authorized personnel will be required to sign a Pledge of

Confidentiality (see Exhibit C) in which they agree not to disclose and to keep confidential all non-public information relating to

the ERS and its members, both active and retired.

XXIII. CONFLICT OF INTEREST

A. Interest in Contract. No officer, employee or agent of the ERS who exercises any functions or responsibilities in

connection with the carrying out of any services or requirements to which this Contract pertains, shall have any personal

interest, direct or indirect in this Contract.

B. Interest of Other Local Public Officials. No member of the governing body of the locality and no other public official of

such locality who exercises any functions or responsibilities in the review or approval of the carrying out of this Contract

shall have any personal interest, direct or indirect, in this Contract.

C. Interest of Contractor and Employees. The CONTRACTOR covenants that no person described in Paragraph XXIII, A

and B above who presently exercises any functions or responsibilities in connection with the Contract has any personal

financial interest, direct or indirect, in this Contract. The CONTRACTOR further covenants that it presently has no

interest and shall not acquire any interest, direct or indirect, which would conflict in any manner or degree with the

performance of its services hereunder. The CONTRACTOR further covenants that in the performance of this Contract

no person having any conflicting interest shall be employed. An interest on the part of the CONTRACTOR or its

employees must be disclosed to the ERS. Provided, however, that this paragraph shall be interpreted in such a manner so

as not to unreasonably impede the statutory requirement that maximum opportunity be provided for employment of and

participation by residents of the area.

XXIV. DISCRIMINATION PROHIBITED

A. In all hiring or employment made possible by or resulting from this Contract there (1) will not be any discrimination

against any employee or applicant for employment because of sex, race, religion, color, national origin or ancestry, age,

disability, lawful source of income, marital status or sexual orientation or familial status, and (2) affirmative action will be

taken to ensure that applicants are employed and that employees are treated during employment without regard to their

sex, race, religion, color, national origin or ancestry, age, disability, lawful source of income, marital status or sexual

orientation or familial status.

This requirement shall apply to but not be limited to the following: employment, upgrading, demotion or transfer,

recruitment or recruitment advertising, lay-off or termination, rates of pay or other forms of compensation, and selection

for training, including apprenticeship. There shall be posted in conspicuous places available to employees and applicants

for employment, notices required or to be provided by federal or state agencies involved setting forth the provisions of the

clause. All solicitations or advertisements for employees shall state that all qualified applicants will receive consideration

for employment without regard to sex, race, religion, color, national origin or ancestry, age, disability, lawful source of

income, marital status or sexual orientation or familial status.

B. No person in the United States shall, on the ground of sex, race, religion, color, national origin or ancestry,

age, disability, lawful source of income, marital status or sexual orientation or familial status, be excluded from

participation in, be denied the benefits of, or be subject to discrimination under any program or activity made possible by

or resulting from this Contract. The ERS and each employer will comply with all requirements imposed by or pursuant

to the regulations of the appropriate federal agency effectuating Title VI of the Civil Rights Act of 1964.

C. The CONTRACTOR will cause the foregoing provisions to be inserted in all subcontracts, if any, for any work covered by


this Contract so that such provisions will be binding upon each subcontractor, provided that the foregoing provisions shall

not apply to contracts or subcontracts for standard commercial supplies or raw materials.

D. Contractor agrees that they will comply with all applicable requirements of the Americans with Disability Act of 1990, 42

U.S.C. 12101, et seq.

XXV. WITHHOLDING OF SALARIES. If in the performance of this Contract there is any underpayment of salaries by the

CONTRACTOR or by any subcontractor thereunder, the ERS shall withhold from the CONTRACTOR out of payments due to it

an amount sufficient to pay to employees underpaid the difference between the salaries required hereby to be paid and the salaries

actually paid such employees for the total number of hours worked. The amounts withheld shall be disbursed by the ERS for and

on account of the CONTRACTOR or subcontractor, if any, to the respective employees to whom they are due.

XXVI. CLAIMS AND DISPUTES PERTAINING TO SALARY RATES. Claims and disputes pertaining to salary rates or to

classifications of architects, draftsmen, technical engineers, and technicians, if any, performing work under this Contract shall be

promptly reported in writing by the CONTRACTOR to the ERS for the latter's decision, which shall be final with respect thereto.

XXVII. OTHER PROVISIONS.

A. Any and all information, plans, reports and conclusions derived or developed as a consequence or result of this Contract

may be utilized by the ERS in such manner and purpose as the ERS desires or determines without permission or approval

of the CONTRACTOR or compensation to the CONTRACTOR therefor other than herein provided.

B. Both parties understand that the ERS is bound by the Wisconsin Public Records Law, and as such all of the terms of this

Agreement are subject to and conditioned on the provisions of sec. 19.21, Wis. Stats., et seq. Contractor acknowledges

that it is obligated to cooperate with the ERS in producing records that are subject to Wisconsin Public Records Law.

C. Headings. All headings and titles used in contract documents exist for the purposes of document organization and

reference and will not be considered a term or condition of any agreement entered into by the CONTRACTOR and the

ERS.

D. Consent to Breach Not Waiver. The consent to a breach of any term or condition of this Agreement by either party will

not be considered a waiver of such term or condition nor will such breach be considered consent to a subsequent breach.

E. Governing Law. The provisions of the Contract will be constructed in accordance with the laws on the State of Wisconsin.

F. Jurisdiction. The venue for any proceedings before a court of law will be in Milwaukee County, Wisconsin.

G. Force Majeure. Neither party will be liable for any failure or delay in the performance of its obligations under this

Agreement (and the failure or delay will not be deemed a default of this Agreement or grounds for termination) if both of

the following conditions are satisfied: (1) the failure or delay could not have been prevented by reasonable precautions,

and cannot reasonably be circumvented by the non-performing party through the use of alternate sources, work-around

plans, or other means; and (2) the failure or delay is caused, directly or indirectly, by reason of fire or other casualty or

accident; strikes or labor disputes; inability to procure raw materials, equipment, power or supplies; war, terrorism or

other violence; any law, order, proclamation, regulation, ordinance, demand, or requirement of any governmental agency

or intergovernmental body other than a party hereto; or any other act or condition beyond the reasonable control of the

non-performing party. Upon the occurrence of an event which satisfies both of the above conditions (a "Force Majeure

Event"), the non-performing party will be excused from any further performance of those obligations under this

Agreement affected by the Force Majeure Event for as long as (a) the Force Majeure Event continues; and (b) the non-

performing party continues to use commercially reasonable efforts to recommence performance whenever and to

whatever extent possible without delay. Upon the occurrence of a Force Majeure Event, the non-performing party will

immediately notify the other party by telephone (to be confirmed by written notice within two business days of the failure

or delay) of the occurrence of a Force Majeure Event and will describe in reasonable detail the nature of the Force

Majeure Event.

THE REMAINDER OF THIS PAGE IS BLANK


IN WITNESS WHEREOF, the CONTRACTOR and the ERS have caused this Contract to be executed for and on their respective behalf as

of the dates hereinafter set forth.

EMPLOYES’ RETIREMENT SYSTEM CONTRACTOR

OF THE CITY OF MILWAUKEE:

By: _____________________________________ Firm: _______________________ John Barmore, President, Annuity & Pension Board

Date: ____________________________________ Address: _____________________

By: _____________________________________ City/State: ___________________ Bernard J. Allen, Executive Director Date: ___________________________________ Zip Code: _______

Telephone:__________________________________

Fax: ______________________________________

By: _______________________________________

Examined and approved as to form and execution this Title: ______________________________________

______ day of ________________________, 201_. Date: ______________________________________

_______________________________________ Witness: ____________________________________

City Attorney Title: ______________________________________

(Note: Someone other than the individual who executed this Contract must certify the following):

CERTIFICATE RE: CORPORATION

I, ______________________________ certify that I am the _____________________________ of the above CONTRACTOR

PRINT NAME

PRINT TITLE

named herein; that ________________________________, who executed this Contract on behalf of the CONTRACTOR was

PRINT SIGNATOR OF CONTRACT

then ______________________________________ of said corporation, and in said capacity, duly signed said Contract for and

OFFICIAL CAPACITY OF SIGNATOR

on behalf of said corporation, being duly authorized so to do under its bylaws or is authorized so to do by action of its duly

constituted board, all of which is within the scope of its corporate powers.

Dated at _______________________________________ this ______ day of _______________________________, 20___.

LOCATION

______________________________________________________ SIGNATURE

PLEASE NOTE! CORPORATIONS MUST COMPLETE THE STATEMENT BELOW.


Appendix D

Current Audit Plan

(please see attached document)


Appendix E: Designation of Confidential and Proprietary Information

Please note: prices always become public information when proposals are opened, and, therefore, cannot be

kept confidential.

The attached submitted material includes proprietary and confidential information that qualifies as a trade

secret, as provided in Section 19.36(5), Wisconsin Statutes, or is otherwise material that can be kept

confidential under the Wisconsin Open Records Law. As such, we ask that certain pages of this response, as

indicated below, be treated as confidential material and not be released without our written approval.

Other information cannot be kept confidential unless it is a trade secret. Trade secret is defined in Section

134.90(1)(c), Wisconsin Statutes, as follows: “Trade secret” means information, including a formula, pattern,

compilation, program, device, method, technique, or process to which all of the following apply: 1. The

information derives independent economic value, actual or potential, from not being generally known to, and

not being readily ascertainable by proper means by, other persons who can obtain economic value from its

disclosure or use. 2. The information is the subject of efforts to maintain its secrecy that are reasonable under

the circumstances.

We request that the following pages not be released: (indicate section, page number, and topic).

________________________________________________

________________________________________________________________

In the event the designation of confidentiality of this information is challenged, the undersigned hereby agrees

to provide legal counsel or other necessary assistance to defend the designation of confidentiality.

Failure to include this form in the proposal may mean that all information provided as part of the proposal will

be open to examination and copying. The City considers other markings of confidential in the proposal

document to be insufficient. The undersigned agrees to hold the City harmless for any damages arising out of

the release of any materials unless they are specifically identified above.

Company name: ____________________________________________

Authorized representative:_____________________________________

signature

Authorized representative:_____________________________________

printed

Date: ______________________________________________________