3880 Lemon St., Ste. 300
Riverside, CA 92501
P.O. Box 1529
Riverside, CA 92502-1529
951-241-7800
www.eadiepaynellp.com
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May 20, 2026
Cory Hodges
Assistant to the City Manager
City of San Bernardino
San Bernardino, California
This letter sets forth our understanding for applying agreed-upon procedures to the review of deliverables by Local Golf Management LLC to the City of San Bernardino (the City) as for the period of June 1, 2023 through May 31, 2026. The City of San Bernardino is responsible for the review of deliverables by Local Golf Management LLC.
This engagement is solely for the purpose of reporting our findings regarding the results of the procedures performed as listed below. This report is intended for use by the management of the City of San Bernardino and is expected to be restricted to the use of these specified parties.
Prior to the completion of the engagement, you agree to provide us with written agreement and acknowledgment that the procedures performed are appropriate for the intended purpose of the engagement as noted above.
The following procedures are requested by the City of San Bernardino:
1. Conduct a kick off meeting with all parties involved in Operation
2. Review management agreement between the City of San Bernardino and Local Golf Management LLC and document all relevant provisions
3. Interview City staff to gain an understanding of the City's policies, organization structures, procedures and directives related to the Operation and documented relevant information.
4. Review Local Golf Management LLC's policies, organization charts, procedures (such as cash receipt, cash disbursement, purchasing and procurement, inventory management, payroll, and financial reporting) and directives related the Operation and document relevant information.
5. Interviews with City public works and finance department staff to gain an understanding and whether there are any issues or concerns regarding Local Golf Management LLC's policies and procedures, and their financial reporting
6. Perform internal control walkthrough with Local Golf Management LLC's management and staff in variance department relating to
1) Cash close outs and cash deposit process
2) Purchasing and procurement process
3) General ledger expense review and coding process, and 4) Capital improvements process.
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7. Obtain detailed financial information from the City and from Local Golf Management LLC as needed to perform the agreed-upon procedures. The information will include, but not limited to, monthly, quarterly or annual financial statements, general ledger details, point of sale information, reports from Local Golf Management, LLC to the City, bank statements, invoices, and check copies.
8. Review and confirm sales transactions, which included cash register audits, tee sheet audits, and test 40 sample of sales transactions during period June 1, 2023 through May 31, 2026 by examining supporting documentation and trace transactions from point of sale to bank statement and general ledger posting.
9. Analyze Point of Sale used by Local Golf Management LLC to identify any issues regarding security or integrity of the information contained within the system, including analyzing access controls.
10. Examine revenue and expense summaries provided to the City by Local Golf Management LLC, bank information, and City's general ledger reports to identify accurate reporting of revenues and expenses for the period of June 1, 2023 through May 31, 2026.
11. Perform analysis to determine whether reported monthly revenues agree with bank deposits.
Investigate significant discrepancies.
12. To determine whether Management Fee paid to Local Golf Management LLC was in accordance with the management agreement.
13. To determine whether Local Golf Management LLC has complied with provisions of the Agreement with the City:
1) Verity whether the operating account structure complied with Section 6.1 specifically whether it was established in the City's name. If the account name was non-compliant, determine whether it was formally waived or modified in writing by the City. 2) Annual Plan is submitted to the City at least 60 days in advance of each Operating Year. 3) Annual Plan is reviewed and approved by the City no later than 45 days following delivery of the Annual Plan by Manager to the City.
4) A 5-year Capital Improvements program plan is updated annually and submitted to the City before the end of November of each contract year
5) Local Golf Management LLC has complied with the insurance requirement per Exhibit D - Schedule of Required Insurance
6) Local Golf Management LLC has complied with the liquor license requirements. 7) Manager notify the City of the total funds in the Operating Account on the 1st day of each month
8) Manager deliver to the City the following forecasts and statements:
i. Within 20 days after the end of each calendar month, an update to the Annual Plan together with monthly and year-to-date financial statements which shall include a balance sheet, a profit and loss statement (on an accrual basis) showing the results of operation of the Facility for such month an for the year to date ii. Within 60 days after the end of each Operating year, financial statements, including a balance sheet, a profit and loss statement and actual versus budget comparison showing the results of operation of the Facility for such year. 9) Compare actual expenses to Annual Plan and verify compliance with the requirement for "prompt notice" to the City when expenses were expected to exceed the Annual Plan.
14. Select 40 samples of purchases during period June 1, 2023 to May 31, 2026 to review pricing, approvals, and conflict of interest issues.
15. Test all cash call requests to ensure they are tied to bank balances, accounts payable aging, invoices and annual plans.
16. Determine the status of 2024 audit findings, if any. Clearly state whether they were corrected, partially corrected, or remain unresolved.
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We will conduct our engagement in accordance with the attestation standards for agreed-upon procedures engagements established by the AICPA. We are responsible for carrying out the procedures and reporting findings in accordance with these standards. We have no responsibility to determine the differences between the procedures to be performed and the procedures that we would have determined to be necessary had we been engaged to perform another form of attestation engagement.
Our report will list the procedures performed and our findings. Our report will be addressed to the management of the City of San Bernardino and will be intended for use by the specified parties as identified above.
Should we have any reservations with respect to the subject matter, we will discuss them with you before the report is issued.
We have no responsibility to update our report for events and circumstances occurring after the date of our report. As part of our engagement, we will request from management, written confirmation concerning representations made to us in connection with the agreed upon procedures. You agree to provide such confirmation.
During the course of the engagement, we may communicate with you or with your personnel via fax or e-mail, and you should be aware that communication in those mediums contains a risk of misdirected or intercepted communications.
Our firm may transmit confidential information that you provided us to third parties in order to facilitate delivering our services to you. We have obtained confidentiality agreements with all our service providers to maintain the confidentiality of your information and we will take reasonable precautions to determine that they have the appropriate procedures in place to prevent the unauthorized release of confidential information to others. We will remain responsible for the work provided by any third- party service providers used under this agreement. By your signature below, you consent to having confidential information transmitted to entities outside the firm. Please feel free to inquire if you would like additional information regarding the transmission of confidential information to entities outside the firm.
Professional standards prohibit us from being the sole host and/or the sole storage for your financial and non-financial data. As such, it is your responsibility to maintain your original data and records and we cannot be responsible to maintain such original information. By signing this engagement letter, you affirm that you have all the data and records required to make your books and records complete.
The timing of this engagement will take place starting June 2026 and we plan to issue a report by end of July 2026.
Brandon Ferrell, CPA is the engagement partner for the services specified in this letter. His responsibilities include supervising the services performed as part of this engagement and signing or authorizing another qualified firm representative to sign the agreed-upon procedures report.
Our fees are based on the amount of time required at various levels of responsibility, plus actual out-of- pocket expenses. We estimate that our fee for the engagement will not exceed $35,000. - 4 -
We will notify you immediately of any circumstances we encounter that could significantly affect this initial fee estimate.
We will maintain the confidentiality of your personal information and will apply procedures to protect against any unauthorized release of your personal information to third parties.
We agree to retain our attest documentation or work papers for a period of at least five years from the date of our report.
Please sign and return the attached copy of this letter to indicate your acknowledgment of, and agreement with, the arrangements for our engagement including our respective responsibilities.
If you have any questions, please let us know.
We appreciate the opportunity to be of service to you and look forward to working with you and your staff.
Respectfully,
Brandon Ferrell Eden Casareno RESPONSE:
This letter correctly sets forth our understanding.
Acknowledged and agreed on behalf of the City of San Bernardino by:
Name: _________________________________________
Title: ___________________________________________
Date: ___________________________________________
Director of Finance and Management Services
5/20/2026
Report on the Firm’s System of Quality Control
To the Partners of
EADIE & PAYNE, LLP
and the Peer Review Committee of the California Society of CPAs We have reviewed the system of quality control for the accounting and auditing practice of Eadie & Payne, LLP (the firm) in effect for the year ended April 30, 2025. Our peer review was conducted in accordance with the Standards for Performing and Reporting on Peer Reviews established by the Peer Review Board of the American Institute of Certified Public Accountants (Standards).
A summary of the nature, objectives, scope, limitations of, and the procedures performed in a system review as described in the Standards may be found at www.aicpa.org/prsummary. The summary also includes an explanation of how engagements identified as not performed or reported on in conformity with applicable professional standards, if any, are evaluated by a peer reviewer to determine a peer review rating.
Firm’s Responsibility
The firm is responsible for designing and complying with a system of quality control to provide the firm with reasonable assurance of performing and reporting in conformity with the requirements of applicable professional standards in all material respects. The firm is also responsible for evaluating actions to promptly remediate engagements deemed as not performed or reported on in conformity with the requirements of applicable professional standards, when appropriate, and for remediating weaknesses in its system of quality control, if any.
Peer Reviewer’s Responsibility
Our responsibility is to express an opinion on the design of and compliance with the firm's system of quality control based on our review.
Required Selections and Considerations
Engagements selected for review included engagements performed under Government Auditing Standards, including compliance audits under the Single Audit Act, and audit of an employee benefit plan.
As part of our peer review, we considered reviews by regulatory entities as communicated by the firm, if applicable, in determining the nature and extent of our procedures.
Opinion
In our opinion, the system o f quality control for th e accounting and auditing practice of Eadie & Payne, LLP in effect for the year ended April 30, 2025, has been suitably designed and complied with to provide the firm with reasonable assurance of performing and repor ting in conformity with applicable professional standards in all material respects. Fir ms can receive a rating of pass, pass with deficiency(ies) or fail. Eadie & Payne, LLP has received a peer review rating of pass.
GYL LLP
Ontario, California
August 22, 2025
Eadie and Payne, LLP's Terms and Conditions Addendum
Overview
This addendum to the engagement letter describes our st andard terms and conditions ("Terms and Conditions") related to our provision of services to you. This addendum and the accompanying engagement letter comprise your agreement with us ("Agreement"). If there is any inconsistency between the engagement letter and this Terms and Conditions Addendum, the engagement letter will prevail to the extent of the inconsistency.
For the purposes of this Terms and Conditions Addendum, any reference to "we," "us," or "our" is a reference to Eadie and Payne, LLP, and any reference to "you," or "your" is a reference to the party or parties that have engaged us to provide services. References to "Agreement " mean the engagement letter or other written document describing the scope of services, any other attachments incorporated therein, and this Terms and Conditions Addendum.
Billing and Payment Terms
We will bill you for our professional fees and out-of-pocket costs monthly as work progresses. Payment is due upon receipt. If payment is not received wi thin 30 days, you will be assessed interest charges of 1% per month on the unpaid balance.
We reserve the right to suspend or terminate our work for non-payment of fees. If our work is suspended or terminated, you agree that we will not be responsible for your failure to meet governmental and other deadlines, for any penalties or interest that may be assessed against you resulting from your failure to meet such deadlines, and for any other damages (including but not limited to consequential, indirect, lost profits, or punitive damages) incurred as a result of the suspension or termination of our services.
Electronic Data Communication and Storage
In the interest of facilitating our services to you, we ma y send data over the Internet, or store electronic data via computer software applications hosted remotely on the Internet or utilize cloud-bas ed storage. Your confidential electronic data may be transmitted or stored using these methods. We may use third party service providers to store or transmit this data, such as providers of tax return preparation software. In using these data communication and storage methods, our firm employs measures designed to maintain data security. We use reasonable efforts to keep such communications and electronic data secure in accordance with our obligations under applicable laws, regulations, and professional standards. We require our third party vendors to do the same.
You recognize and accept that we have no control over the unauthorized interception or breach of any communications or electronic data once it has been trans mitted or if it has been subject to unauthorized access while stored, notwithstanding all reasonabl e security measures employed by us or our third party vendors. You consent to our use of these electronic devices and applications and submission of confidential client information to third party service providers during this engagement.
Client Portals
To enhance our services to you, we will utilize a client portal, a collaborative, virtual workspace in a protected, online environment. The client portal permits real-time collabor ation across geographic boundaries and time zones and allows Eadie and Payne, LLP and you to share data, engagement information, knowledge, and deliverables in a protected environment. In order to use the client portal, you will be required to execute a client portal agreement and agree to be bound by the terms, conditions and limitations of such agreement.
You agree that Eadie and Payne, LLP has no responsibility for the activities of the client portal and agree to indemnify and hold Eadie and Payne, LLP harmless with respect to any and all claims arising from or related to the operation of the client portal. While the client portal backs up your files to a third party server, we recommend that you also maintain your own backup files.
Items placed on the client portal will be deleted periodically according to firm policy.
Newsletters and Similar Communications
We may send newsletters, emails, explanations of technical developments or similar communications to you. These communications are of a general nature and should not be construed as professional advice. We may not send all such communications to you. These communications do not continue a client relationship with you, nor do they constitute advice or an undertaking on our part to monitor issues for you.
Records Management
Record Retention and Ownership
We will return all of your original records and documents provided to us at the conclusion of the engagement. Your records are the pr imary records for your op erations and comprise the ba ckup and support for your work product.
Our copies of your records and documents are not a substitute for your own records and do not mitigate your record retention obligations under any applicable laws or regulations.
Workpapers and other documents created by us are our property and will remain in our control. Copies are not to be distributed without your written request and our prior wr itten consent. Our workpapers will be maintained by us in accordance with our firm's record retention policy and any applicable legal and regulatory requirements.
Our firm destroys workpaper files after a period of 5 years. Catastrophic events or phys ical deterioration may result in damage to or destruction of our firm's records, causing the records to be unavailable before the expiration of the retention period as stated in our record retention policy.
Working Paper Access Requests by Regulators and Others
State, federal and foreign regulators may request access to or copies of certain workpapers pursuant to applicable legal or regulatory requirements. Requests also may arise with respect to peer review, an ethics investigation, or the sale of our accounting practice. If requested, access to such workpapers will be provided under the supervision of firm personnel. Regulators may request copies of sele cted workpapers to distribute the copies or information contained therein to others, including other governmental agencies.
If we receive a request for copies of selected workpapers, provided that we are not prohibited from doing so by applicable laws or regulations, we agree to inform you of such request as soon as practicable. You may, within the time permitted for our firm to respond to any request, init iate such legal action as you deem appropriate, at your sole expense, to attempt to limit the disclosure of information. If you take no action within the time permitted for us to respond, or if your action does not result in a judici al order protecting us from su pplying requested information, we may construe your inaction or failure as consent to comply with the request.
If we are not a party to the proceeding in which the in formation is sought, you agree to reimburse us for our professional time and expenses, as well as the fees and expenses of our legal counsel, incurred in responding to such requests. This paragraph will survive termination of this Agreement.
Summons or Subpoenas
All information you provide to us in connection with this engagement will be maintained by us on a strictly confidential basis.
If we receive a summons or subpoena which our legal counsel determines requires us to produce documents from this engagement or testify about this engagement, provided that we are not prohibited from doing so by applicable laws or regulations, we agree to inform you of such summons or subpoena as soon as practicable. You may, within the time permitted for our firm to respond to any request, initiate such legal action as you deem appropriate, at your sole expense, to attempt to limit discovery. If you take no action within the time permitted for us to respond, or if your action does not result in a judicial order protecting us from supplying requested information, we may construe your inaction or failure as consent to comply with the request.
If we are not a party to the proceeding in which the in formation is sought, you agree to reimburse us for our professional time and expenses, as well as the fees and ex penses of our legal counsel, incurred in responding to such requests. This paragraph will survive termination of this Agreement.
Disclaimer of Legal and Investment Advice
Our services under this Agreement do not constitute legal or investment advice unless specifically agreed to in the Engagement Objective and Scope section of this Agreement. We recommend that you retain legal counsel and investment advisors to provide such advice.
Brokerage or Investment Advisory Statements
If you provide our firm with copies of brokerage (or inve stment advisory) st atements and/or read-only access to your accounts, we will use the information solely for the purpose described in the Engagement Objective and Scope section of the engagement letter. We will rely on the accuracy of the information provided in the statements and will not undertake any action to verify this information. We will not monitor transactions, investment activity, provide investment advice, or supervise the actions of the entit y or individuals entering into transactions or investment activities on your behalf. We recommend you receive and carefully review all statements upon receipt, and direct any questions regarding account activity to your banker, broker or investment advisor.
Other Income, Losses and Expenses
If you realized income, loss or expense from a business or supplemental income or loss, the reporting requirements of federal and state income tax authorities apply to such income, loss or expense. You are responsible for complying with all applicable laws and regulations pertaining to such operations, including the classification of workers as employees or independent contractors and related payroll tax and withholding requirements.
Limitations on Oral and Email Communications
We may discuss with you our views regarding the treatment of certain items or decisions you may face. We may also provide you with information in an email. Any advice or information delivered orally or in an email (rather than through a memorandum delivered as an email attachment) will be based upon limited research and a limited discussion and analysis of the underlying facts. Additional research or a more complete review of the facts may affect our analysis and conclusions.
Due to these limitations and the related risks, it may or may not be appropriate to proceed with any decision solely on the basis of any oral or email communi cation. You accept all responsibility, except to the extent caused by the gross negligence or willful misconduct of Eadie and Payne, LLP, for any loss, cost or expense resulting from your decision (i) not to have us perform the research and analysis necessary to reach a more definitive conclusion and (ii) to instead rely on an oral or email communication. The limitation in this paragraph will not apply to an item of written advice that is a deliverable of a separate engagement. If you wish to engage us to provide formal advice on a matter on which we have communicated orally or by email, we will confirm this in a separate engagement letter.
Management Responsibilities
While Eadie and Payne, LLP can provide assistance and recommendations, you are responsible for management decisions and functions, and for designating an individual wi th suitable skill, knowledge or experience to oversee any services that Eadie and Payne, LLP provides. You are responsible for evaluating the adequacy and results of the services performed and accepting responsibility for such services. You are ultimately responsible for establishing and maintaining internal controls, including monitoring ongoing activities.
Conflicts of Interest
If we, in our sole discretion, believe a conflict has arisen affecting our ability to deliver services to you in accordance with either the ethical standards of our firm or the ethical standards of our profession, we may be required to suspend or terminate our services without issuing our work product.
Alternative Dispute Resolution
If a dispute arises out of or relates to the Agreement including the scope of services contained herein, or the breach thereof, and if the dispute cannot be settled through negotiation, the parties agree first to try to settle the dispute by mediation administered by the American Arbitration Association ("AAA") under the AAA Professional Accounting and Related Services Dispute Resolution Rules before resorting to arbitration, litigation, or some other dispute resolution procedure. The mediator w ill be selected by agreement of the parties. If the par ties cannot agree on a mediator, a mediator shall be designated by the AAA. Any mediator so designated must be acceptable to all parties.
The mediation will be conducted in California.
The mediation will be treated as a settlement discussion and, therefore, will be confidential. The mediator may not testify for either party in any later proceeding related to the dispute. No recording or transcript shall be made of the mediation proceedings. The costs of any mediation proceedings shall be shared equally by all parties. Any costs for legal representation shall be borne by the hiring party.
Proprietary Information
You acknowledge that proprietary information, documents, materials, management techniques and other intellectual property we use are a material source of the services we perform and were developed prior to our association with you. Any new forms, software, docum ents or intellectual property we develop during this engagement for your use shall belong to us, and you shall ha ve the limited right to use them solely within your business. All reports, templates, manuals, forms, ch ecklists, questionnaires, letters, agreements and other documents which we make available to you are confidentia l and proprietary to us. Neither you, nor any of your agents, will copy, electronically store, reproduce or make available to anyone other than your personnel, any such documents. This provision will apply to all materials whether in digital, "hard copy" format or other medium.
Statute of Limitations
You agree that any claim arising out of this Agreement shall be commenced within one (1) year of the delivery of the work product to you, regardless of any longer period of time for commencing such claim as may be set by law.
A claim is understood to be a demand for money or services, t he service of a suit, or the institution of arbitration proceedings against Eadie and Payne, LLP.
Termination and Withdrawal
We reserve the right to withdraw from the engagement wi thout completing services for any reason, including, but not limited to, your failure to comply with the terms of this Agreement or as we determine professional standards require.
Assignment
All parties acknowledge and agree that the terms and conditions of this Agreement shall be binding upon and inure to the parties' successors and assigns, subject to applicable laws and regulations.
Severability
If any portion of this Agreement is deemed invalid or unenforceable, said finding shall not operate to invalidate the remainder of the terms set forth in this Agreement.
Entire Agreement
The engagement letter, including this Terms and Conditions Addendum and any other attachments, encompasses the entire agreement of the parties and supersedes all previous understandings and agreements between the parties, whether oral or written. Any modification to the terms of this Agreement must be made in writing and signed by both parties.