Setting up portable speakers is OK, but the sound is never close enough, and often gets drowned out.
For just such a pool party, pick yourself up some of these floating (yes, in water) speakers from Audio Unlimited.
They operate wirelessly, receiving a 900 MHz signal from a (non-waterproof) transmitter on dry land, which is connected to your MP3 player. The signal is strong up to 150 feet.
The best part about this set-up is that you can sync as many of the white and black audio orbs as you like to a single transmitter.
Sound waves over water waves. Awesome.
Next: The waterproof TV