For those wondering about the Sun Herald-DMR Public Records case…

The Sun Herald found no joy at the Court of Appeals, which reversed Chancellor Schloegel. As of September 2, it was Writ time at the Mississippi Supreme Court, which has not yet ruled whether or not they will be taking the case. Click below to get the 13 page Writ filed earlier this month:

Auditor v Gulf Publishing Writ of Certiorari

Auditor v Gulf Publishing Writ of Certiorari

Where there was light now there is complete darkness

Photo courtesy of a reader. Bay ST Louis Mayor Les Fillingame wastes no time securing MUnicipal re3cords after Court of Appeals decision restricting public access to public records.
Photo courtesy of a reader 3/29/2016. Bay St Louis Mayor Les Fillingame wastes no time securing Municipal records after Mississippi Court of Appeals decision restricting public access to public records.

And the good ol’ boys are going to town. A reminder to everyone that Auditor Pickering’s investigation nabbed a few low level DMR employees but refusing to release the formerly public documents will save his political buddies tons of embarrassment. There is a reason Scott Walker feels like that he was betrayed folks, mainly because he was.

Sun Herald loses DMR records battle on appeal ~ Anita Lee

Anyone that witnessed the performance of the State Auditor in the DMR Scandal should not be surprised……

According to Geoff Pender at the Clarion Ledger the FBI is looking at State Auditor Stacey Pickering’s use of campaign funds for personal expenses, the suggested criminal angle being that Pickering may have evaded paying income taxes when he converted his campaign cash to personal use. Following is the link:

Sources: FBI probing Pickering campaign funds

There are two things that really stand out to me in the story the first being the FBI actually taking a look at Mr. Pickering based upon the on the record comments made to Pender by Tiffany Parrish, who worked on Pickering’s first campaign for State Auditor back in 2007. That said this does not mean the FBI is looking at anything regarding Pickering today. Since the FBI does not generally comment on its investigations how would anyone know otherwise for certain? All that said the Clarion Ledger running this story twelve days before the primary election strongly suggests otherwise.

The second thing that stands out to me is the allegation that Mr. Pickering was  living out of his campaign funds.  This would explain a few things regarding the State Auditor’s dreadful handling of the DMR scandal from the ill advised Joe Cloyd fundraiser that inspired a grassroots protest to the public records coverup orchestrated by Pickering via the misuse of a federal grand jury subpoena, for which he was later found to be in contempt of court.

Of course my long held opinion when it came to Mr. Pickering’s friends that were looting the DMR, is that Pickering’s role was to contain, rather than investigate Mississippi DMR. Continue reading “Anyone that witnessed the performance of the State Auditor in the DMR Scandal should not be surprised……”

Comment bump | Tidelandgate: Never a dull moment here in the Bay

Slabbed can add confirmation of Desdemona’s comment (edited):

Little fun fact for those interested… Good ole Rep Eure is REALLY good friends (like county club good friends) with the famous Miller Time. If my memory serves me correctly, I believe there was some kind of spat (not sure of the details) between Baria and a few employees of Marine Resources some time back (i could be wrong, yet it could have been a rumor) Eure being on the Appropriations Committee controlling money that is managed by Marine Resources… Coincidence? I think not. So, whatever shall we do with the remaining money boys? Same game, different players my friends…

In summary:

  • Rep. Eure is REALLY good friends with Jamie Miller, who is also very good friends with Joe Cloyd.
  • There was a confrontation between Rep Baria and DMR staffers
  • Rep Eure controls the house purse strings over DMR Tideland funding.
  • Rep Baria is currently on the bench in the State House as it is controlled by the GOP
  • Rep Baria and Bay Waveland School Superintendent Rebecca Ladner politicized the local public school district back in January with Ladner’s participation in the Democrat response to Gov Phil’s State of the State address, an action that continues to generate local criticism all these months later.
  • The City of Bay St Louis track record of financial mismanagement under the Fillingame Administration speaks for itself.
  • The Fillingame Administration removed the Harbor wave break from the State Funded Harbor design plans.  The pavilion at the Harbor where the bands play is super nice though.
  • BWSD Superintendent Ladner was recently rewarded for her actions with a new three year contract.

If this sounds like a FUBAR type situation to you, then we’re all on the same page.  And of course the people that suffer from the partisanship are the people that live here but that’s normally how it works.

In other news, Rep Baria’s replacement in the State Senate, Phillip Moran, the guy that Rep Baria tried putting under the bus in the early news coverage of Tidelandgate [Seacoast Echo story here] is on Tuesday’s City Council agenda: Continue reading “Comment bump | Tidelandgate: Never a dull moment here in the Bay”

Comment Bump: Here’s more culture of corruption for ya Stacey. ;-)

I would argue that the audit approach of the Office of the State Auditor, Financial Audit and Compliance Division, County Audit Section with regards to non-compliance with GASB 61 is fundamentally flawed:

The Financial and Compliance Audit Division, the largest division in the agency, is divided into five sections: Education Audit Section, State Agency Audit Section, County Audit Section, Electronic Data Processing (EDP) Audit Section and Report Processing Section. This division is responsible for conducting and overseeing audits of public entities.

Facebook Photo | SRHS Queen Stephanie Barnes Taylor
Facebook Photo | SRHS Legal Services Queen and Chief Compliance Officer Stephanie Barnes Taylor

The audit and inherent risks contained in the County audit is at owned hospital component units for those counties that have them, as they are magnitudes larger financially than the primary government. They have also been allowed to operate in secret by law, which is a red flag in my opinion in terms of fraud risk assessment. As a matter of Governmental GAAP, this would be one of the basic reasons GASB 34 (now GASB 61) was promulgated as the overall financial risk would lie with the larger entity, oftentimes a “component unit” whose failure would cause far more financial carnage than the failure of the primary government. We’re seeing this play out over in Jackson County right now.

Currently in Mississippi, the Auditors office allows the counties to not consolidate their component unit hospitals, Forrest Co and Jackson Co being two examples, with the OSA or private county audit firm expressing adverse opinion on the component unit column of a multi-column financial presentation. The opinion is so complicated as to be next to worthless to all but the CPA practitioner community and lawyers.

To the extent the taxpayer backed financial guarantee related to their hospitals at the county level is material to the Primary government and unrecognized, County auditors are skating on very thin ice from a liability standpoint with such a presentation, which I would argue is fundamentally misleading. I would hope the gang up in Jackson would be having this discussion internally but based on an Anita Lee story from a few months back my guess would be no for reasons I will not elaborate upon. I’d be happy to be proven wrong there.

None of this is a comment bump folks but I needed Mr. Pickering’s attention. I’d like to point out all these cultures of corruption are happening on your charge and watch sir. From chat gres in comments:

Back to SRHS and the compliance department.

Stephanie Barnes Taylor was the Chief of Legal Services and the Compliance Officer for SRHS until 2014.

In 2010 SBT founded The Fruition Group LLC. Continue reading “Comment Bump: Here’s more culture of corruption for ya Stacey. ;-)”

Mayberry by the Sea Part 2: Taxpaying citizens cheated of their right to petition and vote

Making stuff up as you go along can carry severe consequences. Here is the salient verbiage:

§31-8-11. Notice of intent to lease; protest; election; advertisement of lease agreement; award of lease

Before entering into any lease agreement pursuant to this chapter secured by a pledge of its full faith and credit, the governing authorities of any county or municipality shall publish notice of their intention to receive suitable proposals for the leasing of such buildings, facilities or equipment. Such notice shall specify the nature of the proposed building, facility or equipment, the general geographic area in which the same is to be located, the term of the proposed lease agreement, that the obligation to pay rentals during the primary term is to be a continuing obligation of and a charge against the general credit and leasing power of the county or municipality, and the date and hour on or before which such proposals may be received. Such notice shall be published by municipalities and counties in the same manner as required for publishing notice of intention to issue general obligation bonds of the county or municipality, as appropriate. If at least twenty percent (20%), or fifteen hundred (1500), of the qualified electors of a county, whichever is less, or at least ten percent (10%), or fifteen hundred (1500), of the qualified electors of a municipality, whichever is less, file a written protest with the appropriate governing authorities, then an election shall be called by the county in the same manner as provided for the issuance of county general obligation bonds in Sections 19-9-11 through 19-9-17, Mississippi Code of 1972, or by a municipality in the same manner as provided for the issuance of municipal general obligation bonds in Sections 21-33-307 through 21-33-311, Mississippi Code of 1972, to determine whether or not the proposed lease agreement may be executed by the county or municipality. The lease agreement shall be advertised for competitive sealed proposals once each week for two (2) consecutive weeks in a regular newspaper published or having a general circulation in the county or municipality of the governing authority. The date as published for the proposal opening shall be not less than five (5) working days after the last published notice. The lease shall be awarded to the person submitting the lowest and best proposal; however, all proposals may be rejected.

According to a Public Records Request Return to the Hancock County Alliance for Good Government from Bay St Louis City Hall, none of the three full faith and credit capital leases entered into by the City over the past three years, including the fire trucks which caused such a ruckus in the social media early this year, were advertised pursuant to the law, yet now the citizenry is getting stuck with an Ad Valorem Tax Levy to pay them off. Stay tuned.

Drunk on power: An Ode to Billy Joe….

Anyone familiar with the Pine Belt, in particular the Free State of Jones understands all Circuit Court roads lead to Judge Billy Joe Landrum as the one man band judicial district in Jones County creates a Judgeship with mucho power inherent to the office. Late last month State Auditor Stacey Pickering issued a $313,726.73 civil demand to Judge Landrum for helping himself to personal fuel, vehicles and salaries paid from the Community Services Program to employees that were not in any way affiliated with it. The Community Services Programs is funded by fines paid by convicts that is supposed to fund a diversion program that offered alternatives to jail. This should all sound familiar to you folks in St Slammany that read Slabbed.

Notably, the civil demand does not include any Billy Walker type discount and we have a family feud undercurrent as Auditor Pickering also hails from the Free State of Jones, something his press release on the Landrum demand overemphasized IMHO.  Given that Judge Landrum amazingly let the local paper take his picture showing off the CSP paid equipment he was charitably storing at his house so the taxpayers would not be burdened it is no surprise that more recently the DA in the Free State of Jones decided he needed to look into the matter.

Of course Judge Landrum’s timing could not be better as two days before the civil demand was released to the public Landrum announced his intent to seek an 8th term on the Circuit Court. More recently the Judge was issuing press releases to the local media declaring that Auditor Pickering was attempting to interfere with the upcoming election writing that, “Pickering has no business making false allegations about me in an attempt to influence a Jones County judicial election.”

Looks to me from down here on the coast that Billy Joe Landrum may have served one term as Circuit Court Judge too many already. Given the length of time it took to bring former Southhaven Mayor turned perpetrator Greg Davis to trial, the saga of Billy Joe Landrum is likely to be with us for a while.

2013 Bay St Louis Municipal Audit reveals poor financial management Part 1

Here at Slabbed we’re the proverbial Johnny Come Lately to cover the long anticipated release of the 2013 Fiscal Year Single Audit Report for the City of Bay St Louis. That’s OK though because the report was very late being released, less than two months before the subsequent fiscal year end. How can an entity improve if it waits until late in the next year to correct the Significant Deficiencies that were reported in a late submitted Single Audit? The answer is simple junior, you can’t but then again many of the Significant Deficiencies noted in the report have been reported for multiple consecutive years without correction and that too is meaningful.

That said there are two things I need to address straight away as this topic, by its very nature, requires a few posts to fully paint the picture. The first thing is that somewhere in my earlier coverage of the City’s audit process, based upon what were at times inside conversations between the City Council and the Audit Firm in a public meeting, I wrote that the audit firm was within the bounds of professional discretion with their, at that point unreleased, opinion on the financial statements. Reading the report caused me to change my opinion in a nuanced way and here is why straight from Auditing Standards (Codified), Section 570:

.16 The auditor’s conclusion about the entity’s ability to continue as a going concern should be expressed through the use of the phrase “substantial doubt about its (the entity’s) ability to continue as a going concern” or similar wording that includes the terms substantial doubt and going concern. In a going-concern emphasis-of-matter paragraph, the auditor should not use conditional language in expressing a conclusion concerning the existence of substantial doubt about the entity’s ability to continue as a going concern.

So there you go, there is no middle ground in the use of the words “substantial doubt” and “going concern” but there is a trap door for the CPAs to use just in case management, for whatever reason, chooses not to share their plan to salvage the enterprise as was the case with the City of Bay St Louis:

.18 Nothing in this section precludes an auditor from disclaiming an opinion in cases involving uncertainties. When the auditor disclaims an opinion, the report should not include the going-concern emphasis-of-matter paragraph described in paragraph .15 of this section but, rather, describe the substantive reasons for the auditor’s disclaimer of opinion in the auditor’s report as required by section 705.4 The auditor should consider the adequacy of disclosure of the uncertainties and their possible effects on the financial statements as described in paragraph .12 of this section even when disclaiming an opinion.

The disclaimer based on these circumstances is just as bad as getting the going concern qualified opinion, thus the interest shown by the Office of the State Auditor in the City’s finances after the report was released last month and this brings us to the second thing that needs to be addressed in Mayor Fillingame’s assertion the 2013 Audit Report was sensationalized by the media. I think I found what he was talking about. Continue reading “2013 Bay St Louis Municipal Audit reveals poor financial management Part 1”

BREAKING: The Hancock County Alliance for Good Government has issued the following statement

The Hancock County Alliance for Good Government Chairman, Lana Noonan, has been in conversation several times today with the state Auditor’s Office regarding the remarks made by Bay St. Louis Mayor, Les Fillingame, at last night’s City Council meeting.

The Mayor told the Council, while in official session, that officials from the State Auditor’s Office had been in the Bay St. Louis City Hall on Friday, August 29, reviewing the city’s financial records, and found the books to be in great shape with no problems.

The Mayor also stated to the Council that the State Auditor’s officials stated that the city’s independent auditing firm, Wright, Ward, Hatten, and Guel, had greatly over reacted to the city’s finances in their findings.

Today, state auditors, Patrick Dendy and Tom Chain, stated to the Alliance for Good Government that they could make no statements regarding their visit to Bay St. Louis on Friday, August 29, and referred us to Brett Kittredge, Communications Director for the State Auditor’s Office who issued the following statement to the Alliance for Good Government:

The Office of the State Auditor, nor State Auditor Stacey Pickering, have issued any statement of the finances of the city of Bay St. Louis. ~ Wednesday, September 3, 2014. Brett Kittredge–Communications Director–State Auditor’s Office