Auditing Financial Statements

[Kerry Liles]

Re: Auditing Financial Statements

So Larry, how helpful has this thread been for you so far?

[Zeljko Kitich]

Re: Auditing Financial Statements

Mr. Kitich is obviously a big fan of bureaucracy and formal rules from reading his opinions on many topics over the years. Often,
what works and is necessary for big business is totally inappropriate for small businesses. Having run a small business for numerous
years, I know you get resourceful in many areas. One would trust that organizations like the CMA and CFC could find the right resourceful
people for these roles. The CFC has in the past often found the wrong people ( including executive ), whether out of lack of choice
or not, hard to say. Bureaucracy, particularily federal government style, was a proven bad fit for the CFC. I think as an enterpreuner
you would have far better judgement on how the CFC or CMA should balance its books etc then Mr. Kitich. One cannot ignore the need
for integrity but keeping an open book should do the trick for the CFC.

ps Not saying the CMA is a small business, but the CFC basically is as of now.

I'm a big fan of following professional methods. I'm not a big fan of leaving things up to amateur hour. From your constant and incessant complaining about anything and everything over the years I would have thought this was your preference as well. Although you really do over do it. People that say a major event like loss of charitable status does not need to be noted in financial statements, because of the publicity at the time, make me wonder if they understand the purpose of financial statements. Your comments have nothing in them that would help the CFC steer clear of getting accounting records into a 'total mess' in future. I'm surprised that you are now happy to overlook the 'total mess' you were complaining about back then. Most entrepreneurs hire accountants. Few are the businesses, big or small, that don't have bookkeeping and accounting assistance. I always advise entrepreneurs to do so. Their time is too precious to get bogged down in doing the accounting. They have a business to run. Professionals are more than able to use specific methods for specific organizations, whether they differ in size, purpose or ownership/membership structure. Your comment is sort of like saying a commercial pilot would not be able to fly a Cesna.

I respect Larry as an entrepreneur, I don't have any particular reason to respect his accounting prowess. In fact most entrepreneurs just want to know what the bottom line is and how much they get to keep after the tax department takes their share. Non-profits want to make sure they are in compliance with funding and charitable status requirements (or is that too bureaucratic for you?) That's also why most entrepreneurs also use the resources of lawyers even for routine matters, their commercial loan officers etc. Many people also have financial planners or at least buy mutual funds that are professional managed. Yes they may not be a big business using more sophisticated methods but their business or money are just as important to them. And yes I know Larry would like to do away with banks, lawyers and accountants; mainly I think because their services have to be paid for. Unfortunately doing away with these would make the economy of Canada poorer. The CFC may never issue bonds or have a stock IPO but accounting records should never be in a 'total mess'. You also need this type of support to grow from small to medium to big. Most entrepreneurs have the desire to grow their business.

This sort of intrigues me though. Are CMA financial records available to the public, what is the per cent of revenue that is spent on programs etc. I'm sort of curious now to see what CMA financial records actually look like. Does Larry prepare them himself? Does a staff member? I guess a check of the CRA charitable site would reveal some things.

[Egidijus Zeromskis]

Re: Auditing Financial Statements

Are CMA financial records available to the public, what is the per cent of revenue that is spent on programs etc. I'm sort of curious now to see what CMA financial records actually look like. Does Larry prepare them himself? Does a staff member? I guess a check of the CRA charitable site would reveal some things.

The CMA is not a charitable organization, as I know. The CFC is not too for several years. Thus, CMA do not publish openly their books, and the CFC might not publish as well.

[Hugh Brodie]

Re: Auditing Financial Statements

There is lots of information publicly available for Quebec-based businesses via http://www.registreentreprises.gouv.qc.ca/en/ . I don't know about financials, however (except - whether (or not) the business has submitted their annual reports to the government).

[Larry Bevand]

Re: Auditing Financial Statements

Hi Kerry,

ChessTalk is always fun...not always constructive. I know someone who tells me he comes to ChessTalk for his humour...better than the shows on TV these days :)

Larry

[Larry Bevand]

Re: Auditing Financial Statements

Good point. In the case of the CFC in the bad years...the bookeeping was extremely poor...an auditor would not have been able to find a paper trail...

[Zeljko Kitich]

Re: Auditing Financial Statements

I'm guessing Mr. Gillanders had more than enough reason to decline your services. There are a few things he likely considered:

1. Are you a CA?
2. Have you worked in accounting professionally for ~ 5+ years?
3. Validity of your degree?
4. Your conduct on ChessTalk?

I'm guessing he may have been concerned by one or more of the above points.

Is Mr Gillanders a CA? Boy how much of a 'total mess' are these records that Mr Gillanders can't even sort them out himself or even with help in 5 months? As to the validity of my degree I won't dignify that question with an answer. Point 4 - I'm plain talking, non-behind kissing -so sorry if that irks you. 2. I have more than 3 years in the finance department of a major municipality and 2 years as the secretary-treasurer of a 3000 member, multi-million dollar labour local. With 8 full time staff of one type or another, a payroll to meet and a multi-million dollar separate investment fund placed under the management of a major Canadian banks investment arm. The result of which I was directly responsible to the membership for. In other words if the investment results were poor and we needed to get another investment manager that was my call and responsibility to make. Part of a major labour organization in Canada. I was specifically in charge of the finances of an organization that makes the CFC look like an ant. I know what an audit is because I cleaned up the accounts and treasury management to be able to have 2 years audited by a CA firm. I have 9 years as a case manager responsible for issuing over $200,000 in social benefits each month, just for the cases under my direct supervision. Add it up, that's over 2.4 million dollars a year. My records were never in a mess. What do you have? Pont 5 you ain't the judge of me, but I did offer to sign a confidentiality agreement. This was never going to be an independent audit. I'm sure Mr Gillanders understands why, I'm pretty sure you have no clue as to why.

Last point, who the heck are you to set the required qualifications? That was set by Mr Gillanders when he put the call out for volunteers. Suddenly an 'accounting background' required has become a CYA exercise by Mr Gillanders and Kevin Me-too to further bury the matter under a blanket of BS. 'We moved on' meaning we did nothing about it being the great solution offered. What qualifications do you have to determine the qualifications required. Do you know the first thing about accounting qualifications? Apparently not because you don't even know what qualification Mr Gillanderss holds. Are you an HR professional? Obviously not.

If there ever was an organization that needed an independent audit and better internal controls put in place, it is clearly the CFC. It is not a simple and unnecessary exercise in throwing money out the window as Larry Bevand has suggested. I'm starting to thnk that some people know the cost of many things but the value of very few things.

[Duncan Smith]

Re: Auditing Financial Statements

Hi Kerry,

ChessTalk is always fun...not always constructive. I know someone who tells me he comes to ChessTalk for his humour...better than the shows on TV these days :)

Larry

Must be tricky juggling the roles of student, nonprofessional accountant, unlicensed tax auditor,
and unlicensed policeman on public transit. :)