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.~ • <br />Peat Marwick <br />Mr. Robert Herrera <br />La Porte Area Water Authority <br />July 8, 1988 <br />2 <br />You have asked Peat Marwick to assist the LPAWA in this process. More <br />specifically, our objectives are to: <br />1. Review prequalification submissions by project from each contractor <br />to determine whether they are in compliance with LPAWA requirements <br />(e.g., Have they submitted audited or reviewed financial <br />statements?). <br />2. Contact financial institutions and bonding agents for each contractor <br />to ascertain the nature of the relationship and any additional <br />information that may provide information on financial stability. <br />3. Analyze financial statements to determine the ability of each <br />contractor to meet project expenses such as payroll. <br />4. Make recommendations, in accordance with LPAWA requirements, <br />regarding the capability of contractors to undertake and successfully <br />complete specified projects. <br />APPROACH <br />In order to accomplish these objectives, we will undertake the following <br />tasks: <br />o Review each contractor's submittal statement for compliance to <br />specific provisions of Ordinance No. 1476-A of the City of La Porte, <br />which has been adopted by LPAWA; <br />o Analyze financial statements to determine current financial condition <br />(including working capital); <br />o Contact bonding agents and bond issuing companies to verify the <br />nature of the existing relationship with each contractor; <br />o Review Best's Insurance Reports to obtain performance ratings for <br />companies issuing bonds; <br />o Contact financial institutions for information on the banking <br />relationship with each contractor; and <br />o Summarize our findings and conclusions regarding each contractor's <br />qualification. <br />