[Vision2020] Chamber Squandered a Public Opportunity
Art Deco aka W. Fox
deco at moscow.com
Thu Oct 28 11:31:33 PDT 2004
all,
Sorry, there was a typo [italicized] in the letter below posted earlier.
The sentence: "This means that none of the basic financial data used to
construct the revised chamber financials was not closely examined for accuracy
or validity. The chamber's basic numbers were accepted basically without
verification."
Should have read: "This means that none of the basic financial data used to
construct the revised chamber financials was closely examined for accuracy or
validity. The chamber's basic numbers were accepted basically without
verification."
The sentence is also corrected below in the letter.
W.
----- Original Message -----
From: Art Deco aka W. Fox
To: Vision 2020
Sent: Thursday, October 28, 2004 11:19 AM
Subject: Re: [Vision2020] Chamber Squandered a Public Opportunity
Tom,
Thank you for posting this timely editorial. However, the editorial appeared
to contain at least one serious error. Below is a letter I sent to the Daily
News concerning the editorial.
Murf,
Thank you for your insightful editorial yesterday on the Moscow Chamber of
Commerce. It said part of what many of us have long thought.
I think it likely that the editorial did contain one quite misleading
assertion:
"The full audit didn't materialize but a review did. The review, by an
independent accounting firm, found nothing major enough to warrant a full
audit."
Nowhere in the narrative of the review did the author say that a full audit
was not necessary or desirable. As far as I know, the only people to make that
assertion are Janice McMillan and Paul Kimmell. I have seen nothing that
indicates that Hayden & Ross said that a full audit would not be desirable.
Word in the street is that Jim Pilcher is not happy with some of the public
representations about the review that McMillan and Kimmell have made, including
the lack of the desirability of an audit.
In fact, a close reading of the review indicates that very little was said
about the chamber's financial health or the quality of its financial management:
"All information included in these [revised] financial statements is the
representation of the management of the Moscow Chamber of Commerce."
This means that none of the basic financial data used to construct the revised
chamber financials was closely examined for accuracy or validity. The chamber's
basic numbers were accepted basically without verification.
Further, the review carefully says:
"Based on our review, we are not aware of any material modifications that
should be made to the accompanying financial statements in order for them to be
in conformity with accounting principles generally accepted in the United States
of America."
Combining the two statements, we are left with the slim conclusion that if the
data is correct, then the format of the revised chamber Balance Sheet and
Income/Activity Statements and calculations within that format are within the
bounds of "generally accepted accounting practice." [Major news reports of the
last few years which have exposed the possible fraudulence that can be contained
under "generally accepted accounting practice" certainly do not make such a
statement very reassuring.]
Unfortunately, the review gave scant or no explanations for the many changes
that were made.
Further, the review given out to the public did not contain any revised
chamber foundation financials, without which a total assessment of the chamber
financial health is not possible.
Nor did the review address the problem of why a $148K discrepancy occurred in
the previously published financials, why net income ($75K) from revised FYE 2003
results was subtracted from retained earnings instead of added, and how and for
what reason were the FYE 2003 results revised. In fact, if a I read the
explanationless review numbers correctly, the revised FYE 2003 results (which
show a huge $75K profit) were not used.
Nor were any revised financials for the years 2001 - 2003 presented. All of
these previous financials had problems and misrepresented the financial health
of the chamber. Without these revised financials, it is not possible to make a
complete assessment of what has occurred financially or management-wise over the
last four years. [In fairness to Hayden & Ross, I do not know if such revisions
were part of the initial review agreement; if not, they should have been.]
I do not think the Daily News has done a fair or in-depth reporting of this
entire important matter. I delivered long ago to Nathan documents showing the
$148K discrepancy and The $75K retained earnings problem and the implications of
such.
A more comprehensive analysis of the chambers financials is now underway by
really independent persons. It is fair to say at this point that the management
of the chamber has exhibited egregiously inept financial knowledge and
management. There remains the possibility that even more sinister problems
lurk.
I hope that in the future the Daily News will try to be more factually correct
and balanced in their future coverage of this matter. Such an action will
eventually speed the recovery of the chamber and help to eventually restore at
least some of the confidence, honor, and goodwill the chamber has lost.
Wayne
Wayne A. Fox
waf at moscow.com
PO Box 9421
Moscow, ID 83843
208 882-7975
----- Original Message -----
From: "Tom" <thansen at moscow.com>
To: <vision2020 at moscow.com>
Sent: Thursday, October 28, 2004 11:21 AM
Subject: [Vision2020] Chamber Squandered a Public Opportunity
| >From yesterday's (October 27, 2004) Moscow-Pullman Daily News.
|
| ----------------------------------------------------------
|
| The Moscow Chamber of Commerce is under no obligation to share its books
with
| the public.
| Like any private business or organization, it is responsible to its members
and
| no one else. For the public to demand otherwise could be an exercise in
| futility.
|
| That said, the chamber missed an excellent opportunity to be as up front as
| possible with the public and its members regarding questions about the
| chamber's finances.
|
| At issue were concerns by some chamber members that the organization was in
| financial trouble. Those concerned asked questions but got no satisfactory
| answers.
|
| They then asked the same questions in the public arena.
|
| At that point, the chamber should have taken the high road and answered all
| questions to the members' satisfaction. In so doing, the public also could
have
| been informed.
|
| Instead, the chamber chose to keep tight-lipped until the hue and cry got
too
| loud.
|
| An audit and public review were then promised.
|
| The full audit didn't materialize but a review did. The review, by an
| independent accounting firm, found nothing major enough to warrant a full
| audit.
|
| "Can we be more fiscally responsible," said Paul Kimmell, the chamber's
| executive director. "You bet."
|
| Part of that responsibility is accountability to its members and, by
extension,
| the public.
|
| The chamber is not a public organization in a legal sense, but many of its
| functions serve the public good.
|
| Typically, a chamber of commerce is the first contact a business or family
has
| with an area when they consider relocating.
|
| Chambers in many cities and towns also serve as visitors' bureaus,
encouraging
| tourism and that means money spent in area businesses.
|
| Moscow's chamber is no different. It represents more than 450 business,
| organization and individual members. They all have a right to know if their
| dues are used wisely in the promotion of the businesses and the area.
|
| The chamber must remember openness breeds trust and goodwill.
|
| Right now, those are commodities the chamber sure could use.
|
|
|
|
|
|
|
|
| ---------------------------------------------
| This message was sent by First Step Internet.
| http://www.fsr.net/
|
|
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