Motion Approve Financial Audit

Transcription

1 Motion Approve Financial Audit Members of the Board of Directors, Zone Director Warren Hughes has made the following motion to approve a financial audit: Resolved, that the Board of Directors approve a financial audit of the Treasurer records for the fiscal year that begins June 1, 2012 and ends May 31, 2013 in accordance with Oldsmobile Club of America Policy Manual section The audit should be conducted by an independent auditor with no ties to the Oldsmobile Club of America personally or financially, and at a reasonable cost to the Oldsmobile Club of America and its members. The motion has been seconded by Zone Directors Karl Sup and Jamie Cox. Supporting Information Reasons for this motion that have been submitted by Zone Director Warren Hughes are summarized below: After receiving and reading the latest string of s, we have learned that there still is a portion of members who are leery of the Treasurer and the OCA Board of Directors. One OCA member mentioned that perhaps the OCA funds were tied up as some collateral for a personal loan for the Treasurer. While the members of the Board have no reason to believe that is the case, it is evident that something else must be done to bridge this gap of mistrust and suspicion that surrounds OCA today. Several weeks ago, members of the Great Plains Chapter in my zone suggested that an audit be done. Little was said about it then other than one Board Member stating more or less, are we ever going to put this audit question to rest. With this motion, I intend to do that now. 1 Motion Approve Audit (040913)

2 To my knowledge there has never been a comprehensive audit of the OCA financial records. I asked past President Steve DeNovi if he remembers one. I was on the Board for most of Steve's tenure and neither one of us can recall one. I believe the same for the Childs and Yancey administrations is true. I concur with the Great Plains Chapter that this would be a good thing for OCA and also a good thing for the OCA Treasurer in that he could relish in the vindication that the OCA books are in order. This independent audit could go a long way in restoring relations between OCA members and the OCA Board of Directors. Preliminary estimates for a financial audit for the fiscal year ending May 31, 2013 indicate that the cost would be in the $7,500 to $10,000 range. Action Requested This motion is now open for discussion. Members are encouraged to review available information regarding the request to approve an audit and the costs for that project. To provide sufficient time for submission of information about this topic and allow participation by the member without , discussion will continue through Tuesday, April 16, 2013 at 9:00 pm Pacific Standard Time. At that time, a determination will be made as to whether members are ready to vote on the proposed financial audit or if additional discussion will be necessary. If changes are to be considered, amendments will be distributed to all members and votes will be scheduled accordingly. Chair OCA Bylaws and which were adopted during the July 2011 Board meeting allow the Board to conduct business via between yearly Board meetings, the preceding is the formal record of a current motion which has been submitted for Board action. A copy of this will be mailed to Mr. Kolesar. Mr. Kolesar may contact the secretary by mail or phone ( ) to submit his vote. As a reminder, all Board members need to respond during the voting phase. 2 Motion Approve Audit (040913)

3 Motion Approve Financial Audit Members of the Board of Directors, The OCA Treasurer has asked that the financial audit motion proposed by Zone Director Warren Hughes be amended to be a forensic audit and read as follows: Resolved, that the Board of Directors approve a financial audit of the Treasurer records for the fiscal year that begins January 1, 2003 and ends December 31, 2012 in accordance with Oldsmobile Club of America Policy Manual section 9.31 to provide a full accounting of the OCA Financial Records to ensure that the OCA Members Equity has not been used for other than approved financial transactions and that Accounting Firms paid by the Oldsmobile Club of America have been diligent in their fiducially obligated duty to protect the OCA membership from fraudulent activity of any kind. The audit should be conducted by an independent auditor with no ties to the Oldsmobile Club of America personally or financially, and at a reasonable cost to the Oldsmobile Club of America and its members. The amendment has been seconded by Zone Director Stewart Stephenson. Supporting Information Reasons for this motion that have been submitted by Treasurer Gene Crowdis are summarized below: To ensure that all financial transactions prior to the election of the current Oldsmobile Club of America Treasurer were in accordance with the Bylaws and Policies of the Oldsmobile Club of America, that all accounting practices that were performed by the CPA firm selected by the previous Oldsmobile Club of America Treasurer were in accordance with generally accepted accounting practices. 1 Motion Approve Amended Audit (041613)

4 Further upon the discovery of any wrong doing by any current or past officer of the Oldsmobile Club of America that is punishable by law or by censorship of an organization that sanctions the general practices of such a business, service organization, or professional firm be reported to the proper authorities or such sanctioning body for their review and punitive action as appropriate. The Treasurer has not provided estimates of the cost for a forensic audit for the ten-year period ending December 31, When the Treasurer made a similar motion on April 26, 2010, the Treasurer indicated that the cost for that audit would be in the $40,000 to $50,000 range. On May 3, 2010, the results of the vote on that motion were reported to be: Affirmative 0 No 18 Abstain 2 Accordingly the motion was defeated. Action Requested This subsidiary motion to amend the scope of the audit process is now open for discussion. Members are encouraged to review available information regarding the request to amend the audit and consider the cost associated with that project. To provide sufficient time for submission of information about this topic and allow participation by the member without , discussion will continue through Tuesday, April 23, 2013 at 9:00 pm Pacific Daylight Time. At that time, a determination will be made as to whether members are ready to vote on the proposed amendment to conduct a forensic audit or if additional discussion will be necessary. If changes are to be considered, amendments will be distributed to all members and votes will be scheduled accordingly. Chair OCA Bylaws and which were adopted during the July 2011 Board meeting allow the Board to conduct business via between yearly Board 2 Motion Approve Amended Audit (041613)

5 meetings, the preceding is the formal record of a current motion which has been submitted for Board action. A copy of this will be mailed to Mr. Kolesar. Mr. Kolesar may contact the secretary by mail or phone ( ) to submit his vote. As a reminder, all Board members need to respond during the voting phase. 3 Motion Approve Amended Audit (041613)

6 Motion Approve Financial Audit Members of the Board of Directors, The OCA Treasurer has asked that the financial audit motion proposed by Zone Director Warren Hughes be amended to be a forensic audit and read as follows: Resolved, that the Board of Directors approve a financial audit of the Treasurer records for the fiscal year that begins January 1, 2003 and ends December 31, 2012 in accordance with Oldsmobile Club of America Policy Manual section 9.31 to provide a full accounting of the OCA Financial Records to ensure that the OCA Members Equity has not been used for other than approved financial transactions and that Accounting Firms paid by the Oldsmobile Club of America have been diligent in their fiducially obligated duty to protect the OCA membership from fraudulent activity of any kind. The audit should be conducted by an independent auditor with no ties to the Oldsmobile Club of America personally or financially, and at a reasonable cost to the Oldsmobile Club of America and its members. The amendment has been seconded by Zone Director Stewart Stephenson. Cost estimates for this revision in the scope of the audit have not been submitted for consideration by the originator of this motion. However, estimates of $40,000 to $50,000 were provided when a similar motion was offered three years ago. Action Requested On April 16, 2013, the subsidiary motion to amend the scope of the audit process was opened for discussion. That discussion period ended on Wednesday, April 23, The chair is not aware of any additional incidental motions or proposed amendments related to the subsidiary motion to amend the scope of the audit process. Accordingly, it is time to call for a vote on the subsidiary motion. 1 Motion Approve Amended Audit (042413) - Vote

7 Members are asked to vote on this subsidiary motion (i.e., to change the focus of an audit to be forensic in nature and substantially increase the cost of the audit). Votes will be accepted until Tuesday, April 30, 2013 at 9:00 pm Pacific Daylight Time. Upon completion of this vote, members will be asked to vote on the main motion whether it is to conduct a financial audit (original motion) or a forensic audit (subsidiary motion). Chair OCA Bylaws and which were adopted during the July 2011 Board meeting allow the Board to conduct business via between yearly Board meetings, the preceding is the formal record of a current motion which has been submitted for Board action. A copy of this will be mailed to Mr. Kolesar. Mr. Kolesar may contact the secretary by mail or phone ( ) to submit his vote. As a reminder, all Board members need to respond during the voting phase. 2 Motion Approve Amended Audit (042413) - Vote

8 Motion Approve Financial Audit Subsidiary Motion Members of the Board of Directors, Subsidiary Motion The OCA Treasurer asked that the financial audit motion proposed by Zone Director Warren Hughes be amended to be a forensic audit and read as follows: Resolved, that the Board of Directors approve a financial audit of the Treasurer records for the fiscal year that begins January 1, 2003 and ends December 31, 2012 in accordance with Oldsmobile Club of America Policy Manual section 9.31 to provide a full accounting of the OCA Financial Records to ensure that the OCA Members Equity has not been used for other than approved financial transactions and that Accounting Firms paid by the Oldsmobile Club of America have been diligent in their fiducially obligated duty to protect the OCA membership from fraudulent activity of any kind. The audit should be conducted by an independent auditor with no ties to the Oldsmobile Club of America personally or financially, and at a reasonable cost to the Oldsmobile Club of America and its members. The amendment was seconded by Zone Director Stewart Stephenson. Cost estimates for this revision in the scope of the audit were not submitted for consideration by the originator of this motion. However, estimates of $40,000 to $50,000 were provided when a similar motion was offered three years ago. 1 Motion Approve Amended Audit (050113)

9 Vote Results On April 24, 2013, members were asked to vote on this subsidiary motion. The results are posted below: Position Name Yes No Abstain Did not vote Vice President Steve Mestad X Secretary Dalene DeLong X Treasurer Gene Crowdis X Zone Director Atlantic NE Vacant Zone Director Atlantic NE Bonnie Fochi X Zone Director Atlantic SE Pat Higgins X Zone Director Atlantic SE Ken Williams X Zone Director E Great Lakes Galen Kolesar X Zone Director E Great Lakes Ken Nicholas X Zone Director W Great Lakes Warren Hughes X Zone Director W Great Lakes Terry Olson X Zone Director South Central Stewart Stephenson X Zone Director South Central Rick Winn X Zone Director Pacific NW Jamie Cox X Zone Director Pacific NW Erik Martinson X Zone Director Pacific SW Karl Sup X Zone Director Pacific SW Joe Varley X Legal Advisor Brian McCallister X Chief Judge Ed Konsmo X Swap Meet Chair Everett Horton X The subsidiary motion has less than the fourteen (14) affirmative votes required as specified by Oldsmobile Club of America Bylaw Accordingly, the subsidiary motion did not pass. Next Step The results of this vote confirm that a majority of the members of the Board of Directors believe that an audit should be conducted. However, there are differences about the scope of the audit. 2 Motion Approve Amended Audit (050113)

10 During the discussion phase of the consideration of the subsidiary motion, members who voted for a forensic audit indicated that they have a concern about theft and fraud that may have occurred during the past ten years. They have expressed that concern without knowledge of the cost to conduct such an audit and they have not indicated that they are aware of alternatives that would allow them to achieve their stated objectives at a lower cost. Comments from those who voted for the forensic audit indicate that they are not interested in considering a financial audit and would likely oppose any investigation short of a formal search for theft and fraud. In the context of the preceding, additional information about the scope of the audit, alternatives to achieve the stated objectives of those who want a forensic audit, and associated costs with alternatives will be critical considerations as members of the Board consider the needs of the Oldsmobile Club of America. Accordingly, the chair refers this matter to the Financial Committee and requests that the Financial Committee prepare a presentation for the Board on July 25, The presentation should include, but not be limited to: Chair Summary of differences between a financial audit and a forensic audit; Cost of each form of audit; Alternatives that might be considered and the associated cost for each; and Recommended action to be taken by the Board. OCA Bylaws and which were adopted during the July 2011 Board meeting allow the Board to conduct business via between yearly Board meetings, the preceding is the formal record of a current motion which has been submitted for Board action. A copy of this will be mailed to Mr. Kolesar. 3 Motion Approve Amended Audit (050113)