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<br />American Appraisal Associates
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<br />9, Cost of Reproduction New - The amount required to reproduce a
<br />duplicate or a replica of the entire property at one time in like kind and
<br />materials in accordance with current market prices for materials, labor, and
<br />manufactured equipment, contractors' overhead and profit, and fees, but
<br />without provision for overtime, bonuses for labor, or premiums for material
<br />or equipment, In insurance industry terminology, cost of reproduction new,
<br />as defined above, is synonymous with the insurance industry phrase,
<br />"replacement cost."
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<br />DELIVERABLES
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<br />The City will receive a full complement of reports, one hard copy and a ,PDF file reflecting the
<br />results of American Appraisal's investigation, to include:
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<br />1. A narrative for use by management a"1d outside auditors to assist the
<br />City's efforts in meeting GASB 34 capital asset reporting requirements,
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<br />2, Certificate of Values,
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<br />3, Glossary of accounts and descriptive abbreviations used,
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<br />4, Customized appraisal reports (available at a nominal charge, upon request),
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<br />A. Report - American Appraisal will provide the City with a Summary Appraisal Report, in
<br />accordance with the reporting requirements set forth by the Uniform Standards of Professional
<br />Appraisal Practice ("USP AP"). The report will present only summary discussions of the data,
<br />reasoning, and analyses used in the appraisal process to develop American Appraisal's opinion of
<br />value, Supporting documentation concerning the data, reasoning, and analyses will be retained as
<br />a part of the work papers. American Appraisal is not responsible for unauthorized use of its
<br />report.
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<br />B, (Optional) Statement on Auditing Standards (SAS) No, 70 - The American Institute of Certified
<br />Public Accountants (AICPA) Statement on Auditing Standards (S1\S) No, 70, Service
<br />Organizations addresses audit procedures and reports for service organizations that provide
<br />services to a user organization that are part of the user organization's financial information
<br />system, In that context, SAS 70 is applied to organizations that provide financial information
<br />system functions for processing transactions such as bank trust departments, application service
<br />providers, and service bureaus, PricewaterhouseCoopers, LLP (P\V'C) has been retained to
<br />perform an annual audit of American [\ppraisal's Electronic Property Record Asset Information
<br />System (ePRAIS),
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<br />PWC has completed their audit of our ePRAIS system and issued their report on policies and
<br />procedures placed in operation and tests of operating effectiveness for ePRAIS in accordance
<br />with SAS 70. In particular, the SAS 70 report addresses our appraisal report production system
<br />calculations for back trending, depreciation, accumulated depreciation, and report totals that are
<br />integral to the preparation of our appraisal reports, It should be noted that the SAS 70 report is
<br />applicable to processing transactions not to the performance of our appraisal procedures, The
<br />SAS 70 report is available to our Clients and their independent auditors upon the receipt of their
<br />written request,
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<br />City of Sunny Isles Beach
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<br />9
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<br />May 18, 2007
<br />25115.117.1127
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