1. A formal examination, correction, and official endorsing of financial accounts; especially, those of a business, undertaken annually by an accountant.
2. A systematic check or assessment; especially, of the efficiency or effectiveness of an organization or a process, typically carried out by an independent assessor.
3. In computer programming: a process used to detect accidental input or processing errors as well as fraud, often using test data and special-purpose software.
4. Another aspect of computer programming in which a set of procedures are established to ensure the quality and integrity of a data base and to carry out such a process or procedure.
5. Etymology: from Latin auditus, “a hearing”; past participle of audire, “to hear”.
It now stands for the official examination of business accounts, which were originally oral or spoken. The verb is from about 1557.
OK folks, now that I let y’all in on one of the secret questions you must successfully answer to learn the secret handshake of becoming an auditor, namely that to verb “audit” and the term “auditor” are derived from the Latin word for “listening” and “hearing” let’s examine an alternative world, where auditors must work in silence and are not allowed to ask questions:
Fillingame disagreed with Atkinson’s report in a telephone interview shortly after Thursday’s meeting.
“I read the report and was shocked at the amount of inaccuracies and the amount of very flawed details within the report,” Fillingame said. “It was obvious that a lot of the facts that were supposedly presented were taken from conversations and not drawn from the documents. Really, some of the more serious (accusations), and I’m very concerned about that.”
Fillingame said any information the council required has always been available at city hall, and any problems were due to a lack of manpower to duplicate and deliver the information.
I can understand Hizzoner’s confusion because he was not in attendance when Sam Atkinson, Director of the Office of the State Auditor’s Performance Audit Division, presented her office’s report on the causes of the many well documented problems contained in the FYE 9-30-2014 municipal audit report performed by the firm Wright, Ward, Hatten and Guel. In its simplest terms the performance audit is a report on an audit report.
To the extent the Performance Audit Division owes its origins to what I’ll term an auditing fad dating from the 1990s it would follow it is not the same type of engagement as an audit in accordance with GAAS and GAGAS. This explains why Ms. Atkinson is well qualified to run the Performance Audit Division because she is a Mississippi Governmental Finance expert rather than a CPA although her division has several on staff. Hizzoner and the City’s finance department employees could certainly have benefited from training Atkinson gives at events like MML and that is really what the performance audit process is about, improving performance by pinpointing the root causes of the problems so corrective action can be taken.
The bottom line is Ms. Atkinson’s report highlighted the root causes of the financial and managerial dysfunction at City Hall, where one day Mayor Fillingame is telling Stacey Cato at the Seacoast Echo he lacks the manpower to walk documents across Main Street to the City Council chambers while a few days later tells the City Council he does not want to hire a qualified City Clerk, which is exactly what he did last night. The reason the Mayor did not like the Performance Audit report is that he was held accountable for failing to follow state statute thus the waxing nonsensical above.
There is nothing wrong with not possessing the ability to manage money or an organization for that matter as it takes all kinds of people to make the world go ’round. The failure lies in not letting competent employees do their job.
Last night’s big news to me is Hizzoner not wanting to hire a new City Clerk after burning through three clerks last year in fairly short order exposing two of the three to personal legal liability in the process. The City’s books are a disaster, it had to bring in an outside CPA firm to belatedly close FY 2015 and the 2015 audit will certainly again be late. Instead we were treated in comments to a reference to last night’s public comment section of the recessed meeting, where resident Joan Coleman of the special interest group Les Lovers United chastised Councilman Lonnie Falgout for eating lunch at Dempsey’s with former Mayor Eddie Favre and Sam Atkinson of the Office of the State Auditor. According to Lana Noonan of the Hancock Alliance for Good Government, Falgout disclosed that Henry Winters, spouse of Councilperson McDonald was at the next table and Mr. Winters was evidently fairly obvious about trying to listen in on the lunch banter.1
Speaking of eating lunch, a reader sent me pictures of Councilperson McDonald eating lunch with Trent Favre and Henry Laird about a year or so ago. That picture did not appear on Slabbed because it was not deemed newsworthy, even if the meeting occurred at a time when the current City Attorney was having a hard time obtaining professional liability insurance. Such are the calls one makes in publishing.
We have a contingent of financial professionals and CPAs that read this website so the question is, can an auditor eat lunch with a client? If the answer is yes (even IRS auditors will eat with their auditee provided no benefits are exchanged i.e. “dutch”) to me professionally the better question is should the auditor make a point to eat lunch with the employees of an auditee? I’ll kick start things by saying my answer as absolutely yes but that is one man’s professional opinion.
1. Mr. Winters is allegedly obvious in certain of his real estate transactions involving the local Habitat for Humanity, where his spouse, Councilperson McDonald is the executive director.