Monday, October 15, 2007

Great piece in Saturday's JG

There are two writers that I especially like at the JG: Dan Stockman and Ben Lanka. Dan Stockman has had some great investigative pieces in the JG in recent years.

Check this one out:

<http://www.journalgazette.net/apps/pbcs.dll/article?AID=/20071014/LOCAL10/710140318>

I have not reviewed the tax returns or "books" of "Up the Stairs" and I am relying on the JG for all of my information.

The story details accounting"discrepancies" at a local not-for-profit. The below items need to be fixed; but, are not as big of a deal as the items that follow...

1. The group has done a poor job of "bookkeeping" over the last several years.
2. The group has filed inaccurate tax returns for the last few years.

These items are more normal then you might think. We often take on new clients who are "in trouble" with either the IRS or the Indiana Department of Revenue. We end up going back 3 years in most cases and "fixing" their books.

There are also several items in the story that are extremely disturbing:

1. They are controlled by a five person Board. Their current President has been President since 2006 and has been a Board member for more then ten years. He said that he has never seen the group's tax returns. If true, this is a major problem!
2. Another man has been on the Board since the 1980's and was the previous Treasurer. According to the piece he:
Was not aware the group had reported an $18,000 discrepancy THEN
Said he had forgotten about the $18,000 discrepancy THEN
Said he had read last years tax return THEN
Said he could not remember is he had read any tax returns since 2002.
Heck, maybe Karen Richard will appoint a Special Prosecutor to investigate this...
3. Their previous President (2005 and part of 2006) proposed an audit in July of 2006 and contacted the Indiana AG and the Allen County Prosecutor. Both organizations told her there would have to be an audit PRIOR to an investigation... (This is a major problem as well, if the President of a Board reports a problems and asks for an investigation then there most likely should be an investigation) The previous President then properly resigned.
4. Another Board member was on the Board for two months in 2006 and was then kicked off, according to him he asked too many questions...

Here is my take on this:

1. Board members should take their jobs seriously. Board members should be qualified to hold the posts they hold.
2. It sure sounds like this not-for-profit has large problems. I think that the Allen County Prosecutor should investigate them. Not-for-profit status has to be awarded and there are requirements that must be met to retain not-for-profit status.
3. Board's of Publicly held companies now have to have a financial professional on their Board; it is a legal requirement. This Board should immediately find one and preferably two financial professionals to join their Board and help them implement proper accounting and reporting procedures.
4. The group should be FORCED to get an audit.

What do you think?

Mike Sylvester

P.S. I did cancel my subscription to the JG per an earlier post and I will miss reading some of their pieces...

11 comments:

J Q Taxpayer said...

Mike,

While I find this distrubing I find it interesting. They single out a small group and pounce all over them.

But they are gutless to chalange the 9th floor of the City County building for failing to comply with the state mandate to furnish Conflict of Interest forms. One has to wonder why the city has out right refused to comply with the request?

Then again it is much easier to kick around some small group that is not supported by the powerbrokers.

First of all, we have no clue if this group is just plain miss managed or if there was some intent to do something else.

Anonymous said...

Unfortunately, this is just one of many 501c3 organizations that fail to do its just duty. There are many organizations that have problems with mismanaging monies.

You might find it interesting I am on a board of directors, and we have been in search of a treasurer for our board for the last year, or so. The first one never made it to the meeting, and we had a candidate who is too busy! The way we get around this is that we have a book keeper who is a paid staff member, and then we are hire an auditer every fall! By the way we are talking to two candidates, if you are interesting please leave a comment. A good CPA would be welcomed!

J Q Taxpayer said...

I am glad someone spoke up. I honestly believe you where selected because your group was easy pickings by the newspaper.

I wish you well in getting your accounts squared away and to show the newspaper is was more error then someone ripping off the group.

steve said...

It's an interesting story. But it is also such a small amount of money, and it really does seem like any think corrupt is happening here.

Up the Stairs, and similar organizations, are important for this community. I hope this issue doesn't harm their operations. Similarly, I hope that this issue is not unfairly used be people who would like to denounce the organization.

Andrew Kaduk said...

I thought you canceled your JG script? You needed a fix and bought one from the Kroger down the street didn't you?

I knew it! LOL

LP Mike Sylvester said...

I am currently the Treasurer for one such organization.

If you need a Treasurer please shoot me an email at mike.sylvester@verizon.net. If your group is one whose mission I can support I well might be able to serve as your Treasurer...

Mike

Anonymous said...

If that Chuck Garnett guy had writen that, Tim Pape would have called him a homophobe.

Robert Enders said...

Steve,
$18,000 is not a small amount of money. Most of the people in prison on robbery or theft charges stole a lot less than that.

J Q Taxpayer said...

Robert Enders,

I do think anyone believe $18K is not some amount of money. Nor, keeping the books is a good policy. I know my point is that with all the funny things going on downtown with so much more money invloved that the paper decided to spend maybe 50 column inches on it.

At least that is my take.

Anonymous said...

The SYLVESTER! Times is the new paper being delivered to the SYLVESTER household

Fr. Fozy Bear said...

The UTSCC is starting to issue damage control

*singing (to the tune of jingle bells)

"... Oh what fun it is to watch the drama unfold. Hey!

UTS, UTS, UTSCC, Come down off your blind old horse and join the jubilee. UTS, UTS, UTSCC, Open the books, Throw out the crooks, and make us happy... as can be"

More To Come!

http://frfozybearftwin.blogspot.com/