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Hawai State Association of Counties AC Counties of Kauai, Maui, Hawaii, and City &County of Honolulu Website:hawaiicounties.or i Email.hsac�iicounties.or ` ' October 14, 2022 Aloha HSAC EC, Re: Proposal to disnegange from the 2018/19 audits HSAC engaged with Carbonaro CPAs & Management Group to perform an audit of the 2018 and 2019 fiscal years. In October of 2020,the auditor issued a letter outlining the outstanding items needed and provided the option that they could disengage from the audit in order to help reconcile the accounts. Since then, HSAC has worked to resolve these items from 2018 and 2019,however there still remains outstanding items. Therefore the auditor is now recommending to disengage from the 2018 and 2019 audits as there is significant time and energy needed to complete them as it has been 2 to 3 years since the audit work started. The option of disengaging and not performing the 2019 and 2018 audits and moving forward to doing the 2021 audit will give HSAC more meaningful information as it will be more relevant to what is currently going on and available to be audited. In addition, it will help move HSAC forward in their internal accounting procedures and processes. Section 13B Accounting and Audits, in the HSAC bylaws states the following: The executive committee shall provide for an independent accounting of the books and audit of the accounts and other financial transactions of the corporation and of all operations for which the corporation is responsible. The proposal being presented to the HSAC EC is to disengage from the 2018 and 2019 audits, to then work with Carbonaro CPAs & Management Group to assist in the reconciliations and to establish an online payment management process. The HSAC EC would then pursue an audit for the 2021 fiscal year. Please review and be ready to vote on this proposal in the next HSAC EC meeting on October 25, 2022. Nahelani Parsons, Executive Director Hawaii State Association of Counties