RFP26006796 Solicitation Specifications.pdf

2023-1.v3.04082026 RFP – Agency Solicitation Specifications Page 1 of 15 Revised 4/8/2026

RFP26006796 - AGENCY SOLICITATION SPECIFICATIONS

TITLE: AUDITING SERVICES – TABACCO SETTLEMENT FINANCING

COPORTATION

SECTION A: BACKGROUND

The Tobacco Settlement Financing Corporation (TSFC) was organized on June 13, 2002, as a public corporation by the State of Rhode Island (the State), pursuant to Title 42 of the General Laws, Chapter 133. The purpose of the Corporation is to purchase Tobacco Settlement Revenues (TSRs) from the State. The Corporation is authorized to issue bonds necessary to provide sufficient funds for carrying out its purpose.

In June 2002, and again in June 2007, the Corporation issued revenue bonds that are the sole obligation of the Corporation. Accordingly, the State is not liable for any debts issued by the Corporation. Also, in June 2002 and 2007, pursuant to Purchase and Sale Agreements with the State, the State sold to the Corporation its future rights in the TSRs under the Master Settlement Agreement and the Consent Decree and Final Judgment (the “MSA”). When the Corporation’s obligations with the bonds have been fulfilled, the TSRs will revert to the State. In March 2015, the Corporation issued $620.94 million of Tobacco Settlement Asset-Backed 2015 series A and B bonds. The proceeds of this issuance, along with the release of debt service funds related to the bonds retired, and the proceeds received for the early termination of investment contracts, were used to fully redeem the 2002 Series bonds and repurchase and retire the principal amount of $76.22 million of the 2007 Series bonds.

The bonds of the TSFC are asset-backed instruments that are secured solely by the tobacco settlement revenues.

The TSFC is a blended component unit of the State for financial reporting purposes.

Accordingly, its financial statements are included in the State of Rhode Island’s Annual Financial Report.

The financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, as prescribed by the Governmental Accounting Standards Board.

A copy of the latest audited financial statements for the TSFC may be found on the TSFC’s website (https://tsfc.ri.gov/ ). A copy of the latest audited financial statements has been included in this posting as Exhibit A.

The TSFC does not receive Federal assistance and, therefore, the provisions of the OMB Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards – Subpart F – Audit Requirements are not applicable.

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The firm selected shall have access to the TSFC’s records for the preliminary testing of controls prior to the June 30th fiscal year end. The final trial balance for the fiscal year will be available by the second week of August.

The TSFC will submit to the auditing firm a draft of all financial statements, notes, supplementary schedules and management’s discussion and analysis at dates to be agreed upon between TSFC and the auditing firm.

SECTION B: SCOPE OF WORK AND REQUIREMENTS

The TSFC was organized on June 13, 2002, as a public corporation by the State of Rhode Island (the State), pursuant to Title 42 of the General Laws, Chapter 133. The purpose of the Corporation is to purchase Tobacco Settlement Revenues (TSRs) from the State. The Corporation is authorized to issue bonds necessary to provide sufficient funds for carrying out its purpose.

In June 2002, and again in June 2007, the Corporation issued revenue bonds that are the sole obligation of the Corporation. Accordingly, the State is not liable for any debts issued by the Corporation. Also, in June 2002 and 2007, pursuant to Purchase and Sale Agreements with the State, the State sold to the Corporation its future rights in the TSRs under the Master Settlement Agreement and the Consent Decree and Final Judgment (the “MSA”). When the Corporation’s obligations with the bonds have been fulfilled, the TSRs will revert to the State. In March 2015, the Corporation issued $620.94 million of Tobacco Settlement Asset-Backed 2015 series A and B bonds. The proceeds of this issuance, along with the release of debt service funds related to the bonds retired, and the proceeds received for the early termination of investment contracts, were used to fully redeem the 2002 Series bonds and repurchase and retire the principal amount of $76.22 million of the 2007 Series bonds.

The bonds of the TSFC are asset-backed instruments that are secured solely by the tobacco settlement revenues.

The TSFC is a blended component unit of the State for financial reporting purposes.

Accordingly, its financial statements are included in the State of Rhode Island’s Annual Financial Report.

The financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, as prescribed by the Governmental Accounting Standards Board.

A copy of the latest audited financial statements for the TSFC may be found on the TSFC’s website (https://tsfc.ri.gov/ ). A copy of the latest audited financial statements has been included in this posting as Exhibit A.

The TSFC does not receive Federal assistance and, therefore, the provisions of the OMB Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards – Subpart F – Audit Requirements are not applicable.

The firm selected shall have access to the TSFC’s records for the preliminary testing of controls prior to the June 30th fiscal year end. The final trial balance for the fiscal year will be available by the second week of August.

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The TSFC will submit to the auditing firm a draft of all financial statements, notes, supplementary schedules and management’s discussion and analysis at dates to be agreed upon between TSFC and the auditing firm.

SECTION B: SCOPE OF WORK AND REQUIREMENTS

The selected firm will provide the following financial statement auditing services, in accordance with Rhode Island General Laws § 35-7-1 and § 22-13-6, and the STATE

OF RHODE ISLAND GUIDELINES FOR QUASI-PUBLIC ENTITY AUDIT

PROCUREMENT AND BID SPECIFICATIONS as issued by the Rhode Island Department of Administration and Office of the Auditor General:

Due Dates for Completion of Audit and Delivery of Reports

1. The audit for fiscal years 2026, 2027, and 2028 shall be completed and final audit reports (inclusive of all audit communications) related to the financial statements must be delivered to the TSFC, Department of Administration – Office of Accounts and Control, and the Office of the Auditor General by September 30 of each year (as required by Section 35-6- 37 of the General Laws).

Failure to comply with the statutory submission date may result in termination of a firm’s audit engagement.

Compliance with due dates for submission of the final audit report requires anticipation of and allowance for (1) sufficient review time by the Office of Accounts and Control and the Office of the Auditor General of draft audit reports and other audit communications; and (2) sufficient review time and acceptance by the Chairman and the Board of Directors of the TSFC.

Draft reports shall be provided to the Office of Accounts and Control and the Office of the Auditor General not less than 7 days prior to the required final audit completion and submission date. Draft reports and other communications submitted for review to the Office of Accounts and Control and the Office of the Auditor General shall have undergone review by the firm’s internal quality control review process prior to submission.

Submission of audit reports and communications in electronic form is preferred.

Qualifications of Auditor

1. The firm selected for the audit shall be a firm of certified public accountants holding a valid practice permit in the State of Rhode Island (issued by the Rhode Island Board of Accountancy).

2. The senior accountant in charge of the fieldwork shall be a certified public accountant.

3. The audit organization and the individuals responsible for planning, directing, conducting substantial portions of the fieldwork, or reporting on government

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4. The audit organization shall have an appropriate internal quality control system in place and participate in an external quality control review program as required by Government Auditing Standards.

5. The audit organization shall provide a copy of their most recent external quality control review report and also submit the results of any subsequent review performed during the term of the contract to the TSFC, the Auditor General and the Director of Administration.

Audit Contract

1. Audit contracts can cover a maximum period of 5 years – a three (3) year initial contract period with two (2 one-year extensions. Before extending the audit contract beyond the initial three (3) contract period the quasi-public entity shall seek approval from the Department of Administration and the Auditor General. When an initial contact period has been for a total of five years and the same firm is engaged through a new procurement, the second contract period shall be for no more than 3 years to limit the total continuous engagement period to no more than eight (8) consecutive years. The engagement of auditors for more than eight consecutive years can be made when deemed necessary and when approved jointly by the Auditor General and Director of Administration.

2. Audit contracts covering more than one year shall specify an audit fee for each year. The audit fee for the financial statement audit and supplementary schedule of expenditures of federal awards shall be inclusive of all expenses.

Audit Standards

1. The audit specifications shall require that the audit be conducted in accordance with generally accepted auditing standards established by the American Institute of Certified Public Accountants.

2. The audit specifications shall also require that the audit be conducted in accordance with the standards for financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States.

Audit Scope

1. The scope of the audit shall be clearly defined by the agency in the request for proposals.

2. The basic financial statements to be presented, audited, and reported upon by the private auditor shall be identified:

a. Statement of Net Position (full accrual)

b. Statement of Activities (full accrual)

c. Statement of Cash Flows

d. Balance Sheet-Governmental Fund with a reconciliation to the

Statement of Net Position

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e. Statement of Revenues, Expenditures, and Changes in Fund Balance- Governmental Fund with a reconciliation to the Statement of Activities

3. Notes to the financial statements

4. The accounting firm will assist management with the preparation of the Management’s Discussion and Analysis, as required supplementary information, to be included in the financial statements.

5. Supplemental Schedules to be presented, audited, and reported on include:

f. Supplemental Calculation of Debt Service Ratios

g. Supplemental Schedule of Actual MSA Receipts Compared to Base

Projections at Time of Sale

6. A detailed schedule of travel and entertainment expenses shall be included as supplementary information with reference in the auditor’s opinion on the financial statements to the supplementary information. Guidance on the preparation of the Schedule of travel and entertainment expenses is included as Appendices 3 (A) and 3 (B) of the “Quasi-Public Entity Audit Bid Specifications and Procedures”.

Audit Reports

1. Draft copies of all audit report(s) and other audit communications shall be submitted to:

(1) the Chairman and Board of Directors of the TSFC, and

(2) Office of the Auditor General and the Department of Administration

- Office of Accounts and Control prior to completion and issuance and in advance of the required due date (September 30) to allow sufficient time for review and comment. Draft reports shall be provided to the Office of Accounts and Control and the Office of the Auditor General not less than 7 days prior to the required final audit completion and submission date. Draft reports and other communications submitted for review to the Office of Accounts and Control and the Office of the Auditor General shall have undergone review by the firm’s internal quality control review process prior to submission.

Final audit reports (inclusive of all audit communications) related to the financial statements must be delivered to the agency, Department of Administration – Office of Accounts and Control, and the Office of the Auditor General by September 30 of each year (as required by Section 35-6-37 of the General Laws).

Compliance with due dates for submission of the final audit report requires anticipation of and allowance for (1) sufficient review time by the Office of Accounts and Control and Office of the Auditor General of draft audit reports and other audit communications; and (2) sufficient review time and acceptance by the audit committee, board of directors, or individuals constituting those charged with governance for the entity.

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Failure to comply with the statutory submission date may result in termination of a firm’s audit engagement.

2. Reports to be submitted, depending on the scope of the engagement, may include:

a. Reports on:

(1) basic financial statements, (as specified in the Audit Scope section) based on an audit performed in accordance with generally accepted auditing standards and Government Auditing Standards.

(2) supplementary financial statements, schedules and information (including the State required format supplementary schedules to be submitted to the Office of Accounts and Control for component units).

(3) internal control over financial reporting and on compliance based on an audit of financial statements performed in accordance with Government Auditing Standards.

b. Reports required under trust agreements, loan agreements, etc

c. Other reports requested by the agency and/or the Department of Administration - Office of Accounts and Control and/or the Office of the Auditor General or as required by the applicable section of the General Laws.

3. A detailed schedule of travel and entertainment expenses shall be included as supplementary information in the financial statements. All expenditures of $200 or greater shall be itemized and a total shown for all expenditures less than $200.

Chapter 35-7-14 of the General Laws of the State of Rhode Island requires the agency to prepare and maintain documentation for all travel and entertainment in sufficient detail to allow for post audit. (Guidance on the preparation of the Schedule of travel and entertainment expenses is included as Appendices 3 (A) and 3 (B) of the “Quasi-Public Entity Audit Bid Specifications and Procedures”.)

Management Letter

1. The audit specifications shall provide for the submission of a management letter upon completion of the audit to the executive director, audit committee, and board of directors, with copies to the Department of Administration – Office of Accounts and Control and the Office of the Auditor General.

2. The management letter should include comments, and/or recommendations beyond those included in the reports described above, on such matters as:

a. policies, procedures and practices employed by the agency.

b. immaterial weaknesses in the internal controls that are not "significant deficiencies."

c. use of resources to provide a governmental service in a reasonable, judicious, economical, and efficient manner.

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d. compliance with State laws pertaining to the agency and with rules and regulations established by the agency.

Coordination Between the Auditor of the Agency and the Office of the Auditor General and Department of Administration – Office of Accounts and Control

The auditor shall invite the attendance of the Auditor General at entrance, exit and other conferences between the private auditor and the agency.

The auditor shall submit ALL "draft" copies of the audit report(s) and other audit communications not less than 7 days prior to the scheduled delivery date for the final audit report. Draft reports and other communications submitted for review to the Office of Accounts and Control and the Office of the Auditor General shall have undergone review by the firm’s internal quality control review process prior to submission.

The auditor shall promptly notify the Auditor General and the Director of Administration if the auditor becomes aware of fraud, abuse, or illegal acts or indications of such acts affecting the agency.

The auditor shall promptly notify the Auditor General and the Director of Administration if the auditor encounters any significant accounting and/or auditing problems, or any situations that delay completion of the audit.

Audit workpapers of the auditors shall be made available upon request of the Director of Administration and/or the Auditor General for their review, at the completion of the agency audit.

For audits of quasi-public entities which are also considered component units of the State of Rhode Island:

The Office of Rhode Island Auditor General, in serving as the Group Auditor for the audit of the State of Rhode Island’s (State’s) financial statements will provide communication in Appendix 1 of these Audit Bid Specifications to each component auditor annually in conjunction with their component audit. This communication will include certain required representations that each component auditor must provide to the Auditor General as their documented understanding of their requirements as component auditors within the group audit of the State’s financial statements. This communication also provides certain information regarding the State’s financial reporting entity and established planning materiality levels for the various opinion units represented within the audit of the State’s financial statements. Component auditors will also be required to submit letters of understanding (engagement letters), materiality levels, management representation letters (with corresponding schedules of unrecorded adjustments), and communications with those charged with governance as required by generally accepted auditing standards in accordance with their component audits.

The auditor selected for the agency audit shall cooperate with the Auditor General, as Group Auditor, in his coordination of the Single Audit of the State. This will include communications between the Auditor General and the private auditor regarding the determination of major federal financial assistance programs using the

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Other Provisions – Specified

The TSFC may require the firm to deliver an annual presentation of the annual audit to the TSFC Board during a quarterly board meeting. The firm may be asked to create supplemental presentation materials for the Board’s to be used during the annual presentation of the annual audit. The firm may be asked to attend other Board meetings upon request.

SECTION C: PROPOSAL MATERIALS

1. Technical Proposal

Narrative and format: Bidders must submit a technical proposal which addresses each of the following elements and is limited to eleven (11) pages (this excludes any appendices and as appropriate, resumes of key staff that will provide services covered by this request):

A. Qualifications and Experience – Overall qualifications and experience of the firm and the specific engagement personnel to be assigned focusing on experiences with governmental entities and the specific line of business or services provided by the entity to be audited. This section includes:

Experience with governmental audit engagements and entities similar to the entity.

Firm organization and leadership team and professional staff resources.

Engagement staff qualifications and experience.

A written representation that the auditor is independent under the requirements of the American Institute of Certified Public Accountants and Government Auditing Standards.

A written representation that the auditor of a quasi-public entity meets the continuing educational requirements of Government Auditing Standards.

A written representation that the auditor has an appropriate internal quality control system in place and has participated in an external quality control review program as required by Government Auditing Standards. The firm will provide the entity requesting auditing services and the Auditor General with a copy of the firm’s most recent external quality control review report and any subsequent reports received during the term of the contract, if awarded.

A written representation that the auditor is familiar with generally accepted accounting principles for state and local government units as prescribed by the Governmental Accounting Standards Board and with the generally accepted auditing standards promulgated by the American Institute of Certified Public Accountants; Government Auditing Standards issued by the Comptroller General of the United States; the Single Audit Act of 1984 as amended in July 1996 and the provisions of OMB Circular Uniform Administrative Requirements, 2023-1.v3.04082026 RFP – Agency Solicitation Specifications Page 9 of 15 Revised 4/8/2026

Cost Principles, and Audit Requirements for Federal Awards - Subpart F – Audit Requirements and will conduct the audit and will report in accordance with those standards.

A written representation that any sub-contractors, co-proposers, or any other entity providing professional services under the engagement will be subject to, and will have met, all the same applicable requirements as the proposer.

In accordance with Chapter 27 of Title 17 of the Rhode Island General Laws, the auditor has filed or will file upon execution of this contract, if required, an affidavit with the State Board of Elections concerning reportable political contributions.

A certification that no Rhode Island “Major State decision-maker”, or spouse or dependent child of such person as defined in RIGL § 42- 6-1 holds either a ten percent or greater equity interest or a five thousand dollar or greater cash interest in the business.

B. Audit Approach and Strategy - Overall audit approach and audit strategy described/outlined in the proposal and firm capacity to perform the engagement within the specified timeframe (prior experience of the firm in meeting timelines should be factored in here).

a. Understanding of work to be performed, including planned audit procedures, process to gain an understanding of internal control sufficient to plan the audit, estimated hours and other pertinent information.

b. Understanding regarding data to be provided and completed by entity that is needed for the audit.

c. Project management approach and procedures the proposing firm will employ to ensure compliance with final audit completion delivery dates.

d. Identification of any sub-contractors, co-proposers, or other entity that will be used to provide the professional services sought by the request for proposal.

C. References – Please provide a list of audit client references that may be contacted regarding professional services provided previously.

a. A listing or description of other professional services provided by the proposer to the State of Rhode Island (primary government) or any other component unit (see Appendix 2 for identification of State component units).

2. Cost Proposal

Provide a cost proposal for the required services which includes the following information: Annual Audit Fee for Financial Statement Audits: The quoted fee should reflect the cost of providing quoted financial statement audits outlined in Section B. The firm should provide an annual quoted fee for the first three years of the initial contract. If applicable, the firm should also provide an annual quoted fee for the two additional 12-month periods.

3. Supplemental Bidder Attestation Form

See Appendix A on the “Overview” tab in Ocean State Procures™ for information. Vendors are required to complete, sign and submit this form with their overall proposal.

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4. ISBE Proposal

See Appendix B on the “Overview” tab in Ocean State Procures™ for information and the MBE, WBE and/or Disability Business Enterprise Participation Plan form(s). Vendors are required to complete, sign and submit these forms with their overall proposal. Please complete separate forms for each MBE, WBE, and/or Disability Business Enterprise subcontractor to be utilized on the solicitation.

SECTION D: EVALUATION AND SELECTION - SOLICITATION SPECIFIC

Technical proposals must receive a minimum of 60 (85.7%) out of a maximum of 70 points to advance to the cost evaluation phase. Technical proposals scoring less than 60 points shall not have the accompanying cost or ISBE participation proposals opened or evaluated; such proposals shall not receive further consideration.

Technical proposals scoring 60 points or higher shall have the cost proposals evaluated and assigned up to a maximum of 30 points, bringing the total potential evaluation score to 100 points.

As total possible evaluation points are determined, vendor ISBE proposals shall be evaluated and assigned up to 6 bonus points for ISBE participation.

Proposals shall be reviewed and scored based upon the following criteria:

Criteria Possible Points

Qualifications and Experience 30 Points

Audit Approach and Strategy 30 Points

References 10 Points

Total Possible Technical Points 70 Points

Cost Proposal 30 Points Total Possible Evaluation Points 100 Points

ISBE Participation 6 Bonus Points

Total Possible Points 106 Points

Additional evaluation criteria can be found at:

For those with an OSP account, see the “Requirements” tab of this solicitation in OSP for additional information on the evaluation and selection process in the “RFP Standard Specification” section.

For those without an OSP account, public access to the full bid can be found at https://ridop.ri.gov/vendors/bidding-opportunities. Search for this solicitation, open the record, click on the “Print/Download Solicitation Summary” button in the upper right corner for all the solicitation requirements and supporting documents are found at the bottom of the page in the “Solicitation Attachments” section.

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Appendix 1

(Sample Representations/Assurances Required When Quasi-Public Entity is a Component Unit of the State for Financial Reporting Purposes)

Note: The Office of the Auditor General (“OAG”) will send this letter to each component auditor annually in conjunction with the audit of the State of Rhode Island’s financial statements.

Component auditors will sign and return to the OAG to assist compliance with meeting the group auditor requirements of GAAS.

Note: References to Attachments A, B, and C in Appendix 1 of this RFP correspond to technical materials that the OAG provides directly to component auditors each year as part of the State of Rhode Island’s group audit. These documents are used solely within the OAG’s annual communication process and are not relevant to, nor required for, this procurement.

Accordingly, Attachments A, B, and C are not included with this RFP.

Re: Audit of TSFC

Section AU-C 600, Special Considerations – Audits of Group Financial Statements (Including the Work of Component Auditors), contains requirements relevant to our audit of the State’s financial statements for the period ending June 30, 2020. In conjunction with your audit of a component unit of the State of Rhode Island, the Office of the Auditor General, as the Group Auditor of the State’s financial statements, is responsible for communicating the following information:

The State’s reporting entity includes all agencies and departments of State of Rhode Island listed in the diagram shown in Attachment A to this communication.

The State’s reporting entity includes all agencies and departments of State of Rhode Island listed in the diagram shown in Attachment B to this communication.

The State’s reporting entity also includes the component units listed in Attachment B to this communication. Attachment B also details the opinion units and related financial statements that include those entities.

The TSFC’s audited financial statements will be incorporated into the financial statements of the State, as the reporting entity. We will rely upon the financial statements and refer to the reports of the other auditors in our opinions on the opinion units contained within the State’s financial statements. The Office of the Auditor General will be relying solely on the TSFC auditor’s opinion and will not accept any responsibility for the work performed by the TSFC auditors.

We will also rely upon and refer to the reports of the other auditors in our Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements in Accordance with Government Auditing Standards and include any significant deficiencies and material weaknesses in internal control and material noncompliance reported by the component auditor.

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The State’s Office of Accounts and Control has provided instructions regarding the State’s financial reporting framework and related matters to all component units, which requires all component units to report their financial information in a State-specified format as supplementary information. TSFC auditors should include either a reference to this supplementary information in their opinion on the TSFC’s financial statements or by issuing a separate report with the supplementary information. TSFC auditors are responsible for ensuring that this supplementary information is fairly stated, in all material respects, in relation to the TSFC’s basic financial statements as a whole.

TSFC auditor engagement personnel must be independent under the requirements of the American Institute of Certified Public Accountants including those in the AICPA Code of Professional Conduct and Government Auditing Standards.

TSFC auditor engagement personnel must meet the continuing educational requirements of Government Auditing Standards.

TSFC auditor firms must have an appropriate internal quality control system in place and has participated in an external quality control review program as required by Government Auditing Standards. The firm will provide the Office of the Auditor General, as the group auditor, with a copy of the most recent external quality control review report.

As communicated by the Office of Accounts and Control, TSFC financial statements must conform to generally accepted accounting principles for state and local government units.

TSFC audits must be performed in accordance with generally accepted auditing standards promulgated by the American Institute of Certified Public Accountants and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States.

In addition, TSFC auditors whose components receive federal funding must ensure that their audits comply with the requirements of the Single Audit Act of 1984 as amended in July 1996 and the provisions of OMB Circular - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards - Subpart F – Audit Requirements. We will communicate an estimate of the major program expenditure threshold for the State of Rhode Island in conjunction with the Single Audit.

TSFC auditors should consult with the Auditor General on any significant audit or accounting issues encountered during their audit.

TSFC auditors have a responsibility to perform reasonable procedures to identify, assess, and respond to the risks of material misstatements arising from the TSFC’s failure to account for and disclose related party relationships, transactions, or balances. This responsibility includes transactions between the component and the State’s reporting entity (including State agencies, departments, funds, and component units defined in Attachments A and B).

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The Office of the Auditor General has provided materiality guidance in Attachment C regarding the performance of component audit work being relied on in conjunction with the audit of the State’s reporting entity. TSFC auditors should consult with the Auditor General in regard to any questions regarding the materiality levels established for component unit audits.

Materiality levels established by TSFC auditors should be materially consistent with those detailed in Attachment C.

TSFC auditors should discuss any instances where, in their professional judgment, there is concern that an uncorrected misstatement in the TSFC’s financial statements could be significant to the State’s reporting entity.

TSFC auditors must submit Letters of Understanding and Management Representation Letters (with attached Schedules of Unbooked Adjustments, if applicable) obtained in conjunction with TSFC audits to the Office of the Auditor General. Such information is required for the Auditor General to document his responsibilities as the group auditor.

All component auditors must submit all required communications to those charged with governance in conjunction with component audits to the Office of the Auditor General.

All components must notify Auditor General and the Director of Administration if they become aware of fraud, abuse, or illegal acts or indications of such acts affecting the TSFC or the State.

TSFC draft financial statements and audit reports will be provided to The Office of the Auditor General and the Office of Accounts and Control for review prior to issuance.

TSFC auditor reports must conform to the illustrative examples included in the AICPA Audit Guides - State and Local Governments and Government Auditing Standards and Single Audits.

Your assistance to us in meeting our group auditor requirements is greatly appreciated. If, at any time, you have questions, concerns, or issues relating to your role as the TSFC auditor, feel free to contact me at 222-2435 or at david.bergantino@rioag.gov.

Sincerely, David A. Bergantino, CPA, CFE Auditor General

Our firm acknowledges receipt of this communication and agrees to comply with the requirements stated herein in our component audit for fiscal 2026:

Component Auditor Representative Title Date

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Appendix 2

TITLE 35 - Public Finance - CHAPTER 35-7 - Post Audit of Accounts

§ 35-7-13 Audit of quasi-public agencies. – All quasi-public agencies including corporations, authorities, commissions, and boards created by the authority of the general assembly, executive order, or state law, excluding cities and their subdivisions, towns and their subdivisions, regional school districts and school committees, water districts, fire districts, and any other municipal corporations and their agencies, subject to post audit, are hereby required to obtain the approval of the director of administration and the auditor general prior to the employment of private auditors. Audit workpapers of the private auditors shall be made available upon request, at the completion of the audit, to the auditor general and/or the director of administration for their review. The audit report shall be furnished to the auditor general and the director of administration.

§ 35-7-14 Travel and entertainment expenses of quasi-public agencies. –Quasi-public agencies, as set forth in § 35-7-13, shall prepare and maintain documentation for all travel and entertainment expenses in sufficient detail to allow for post audit.

TITLE 22 - General Assembly - CHAPTER 22-13 - Auditor General

§ 22-13-6 Requests for auditing and accounting services. – (a) Every state department and agency which contemplates securing the services of an independent accounting firm to perform an audit of a federal assistance grant program shall first request the written approval of the auditor general.

(b) The request to the auditor general shall indicate the period of audit, the services to be rendered, the requirement for services (grant provisions, statutory requirements, etc.), the source(s) of funding, and any other pertinent information.

The request shall be transmitted in writing to the auditor general on a form provided for that purpose at least ninety (90) days in advance of any contractual negotiations with independent public accountants by any state department or agency.

(c) Upon receipt of the request, the auditor general shall conduct an analysis of the request to determine the scope and requirements of the audit services requested in coordination with the audit responsibilities of all state audit agencies.

(d) The auditor general shall notify, in writing, the requesting state department or agency of the results of his or her analysis.

TITLE 35 - Public Finance - CHAPTER 35-6 - Accounts and Control

§ 35-6-37 Financial statements required from state departments, agencies, and instrumentalities. – The department of administration, from time to time, as it deems expedient or necessary, may require statements of financial condition and operations from the several state departments, agencies, and public authorities or corporations in such form and in such detail as it shall prescribe. The several state departments, agencies, and public authorities and corporations shall submit, as required by the state controller, a copy of audited financial statements for the most recent completed fiscal year to the state controller no later than ninety (90) days after the close of the state's fiscal year (June 30th). A waiver from this year-end

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State of Rhode Island Component Units (as of June 30, 2023)

• Tobacco Settlement Financing Corporation

• RI Convention Center Authority

• Ocean State Investment Pool

• RI Housing and Mortgage Finance Corporation

• RI Commerce Corporation

• RI Resource Recovery Corporation

• RI Public Transit Authority

• University of Rhode Island

• Rhode Island College

• Community College of Rhode Island

• Central Falls School District

• RI Turnpike and Bridge Authority

• RI Division of Higher Education Assistance

• RI Industrial Facilities Corporation

• RI Industrial-Recreational Building Authority

• RI Airport Corporation

• Quonset Development Corporation

• I-195 Redevelopment District Commission

• The Metropolitan Regional Career and Technical Center

• HealthSource Rhode Island Trust (Private-purpose Trust Fund)

• Rhode Island Infrastructure Bank

• Rhode Island Health and Educational Building Corporation

• Rhode Island Higher Education Savings Trust (Private-purpose Trust Fund)

• Able Consortium Trust (Private-purpose Trust Fund)

Related organizations of the State of Rhode Island include the Narragansett Bay Commission and the Rhode Island Student Loan Authority.