Lunch with the auditor a bad thing?

audit
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. Continue reading “Lunch with the auditor a bad thing?”

What is Singing River Health System and the Jackson County Board of Supervisors Hiding? A comment bump

Singing River Health System has refused to release a financial accounting of its employee pension fund, even though its own annual audit says the records are available to the public on request.

On March 9, the Sun Herald made such a request. We asked for retirement-plan financial statements from 2006 to 2014, except the year 2010-2011 because the newspaper found that statement online.

As the Sun Herald’s Anita Lee reported, without all of those records it is impossible to say how investments might have affected the retirement plan.

For months now the holy grail of reporting on the Singing River Health System disaster lay in the well rumored sweetheart related party transactions between insiders at the Health System, the Health System itself and the defined benefit pension plan the Hospital’s Board of Trustees voted in secret to terminate last November. SRHS has fought any public disclosure of its finances tooth and nail preferring instead to launch a legal jihad to remove Chancellor Harris from the related state litigation filed by retirees desperate to save the financial results of life’s work for the system.

Slabbed has documented previously undisclosed related party transactions involving the former Board of Trustee Attorney, his family and the health system. Slabbed’s commenters have uncovered even more related party transactions involving the Health System and its former Legal Services director. My guess is these limited disclosures barely scratch the surface of the cronyism that is at the heart of the SRHS financial meltdown.

So what is SRHS hiding in the pension’s financial records that Anita Lee seeks? Nunn Yabidnez posited a theory a few days ago on these pages that matches a rumor that has been circulating for a little while now and this theory is well worth exploring in the absence of any information from the Pension Plan:

Here’s a possible theory for a lot of the SRHS pension problems. I don’t claim it as fact, but the dates and the “what is known,” combined with the various external situations, tend to fit. Remember, it’s just a theory.

Some background:
One way to “benefit” from pension management is to invest the funds in places that will make a reasonable income for the fund, but also cut the management in for a taste via “commission sharing” from brokers, investing in “sweetheart” deals with “friends” and doing so via what appears to be a legit broker/manager (see FiduciaryVest). There are even ways to pull equity market manipulations. And as long as things stay fair-to-middlin’ and nobody gets too stupid or greedy, things could rock along with no one ever being the wiser. However, if one or more of the “covering factors” go south, things can get bad in a hurry, esp. if the fund is stretched too thin on “friends helping friends” deals that depended on an up market. So, what does that have to do with SRHS?

That said, here’s a maybe: Continue reading “What is Singing River Health System and the Jackson County Board of Supervisors Hiding? A comment bump”

Anyone else remember……

Sometime back when the SRHS pension plan fiasco first entered the news cycle, the gang at the Hospital had an early set of talking points that included yammering about how the plan was a public sector plan and that ERISA did not apply (Slabbed debunked those talking points here). Today of course the pension plan litigation is back in state court exactly where SRHS originally said it belonged in those early statements. Except now they do not like the Chancellor assigned to the case.

Quietly and behind the scenes Slabbed has been getting some sage legal analysis from the local legal community. As is often the case I can’t disclose any of what has been shared but what I can do is point to what we already know and maybe gain a few clues about the forces at play. In short this is not about the Health System as much as it is about the folks that control it and the scrappy group of retirees that aren’t going down without a fight. We start with the latest:

Who has a conflict? Certainly not the judge on SRHS cases, retirees argue ~ Anita Lee

The Sun Herald linked a copy of the recusal opposition from retiree Cynthia Almond to accompany the story and it is a must download and read. Retiree lawyers Harvey Barton and Earl Denham turn the Hospital recusal motion on its head, pointing out the glaring legal conflicts that exist between SRHS and its law firm, especially at the time the acts that are the subject of the litigation were perpetrated.

We covered all this, the rumored insider transactions involving then Board Attorney Roy Williams, SRHS and companies owned in part by Mr. Williams’ sons. One of those related party transactions is now incredibly the subject of litigation between SRHS and Team Williams.  Aside from that lawsuit however, SRHS has faithfully stood by their law firm’s side ostensibly even accepting Mr. Williams’ son as their new Board attorney, even after Slabbed placed the proverbial cherry on top with new potential conflicts. Continue reading “Anyone else remember……”

Back in the land of the living

Luckily we live in an advanced age where Oseltamivir can stop a case of the flu dead in its tracks. I was especially lucky as my Doc was working Christmas eve morning.  Like Lana and her hubby this past Thanksgiving, sharing the season’s pestilence was a family affair for us as well.

With that out of the way I’d like to acknowledge that much to my horror several pieces of high quality email in response to the post I did on the rumored related party transactions at Singing River Hospital went to my spam folder.  I have rectified the issue and will be replying to each today as I catch up on unfinished business.  I’d like to thank every one of you folks that contacted me sharing additional information.  It will be put to good use.

The biggest news item here behind the scenes at Slabbed relates to that rumored Mississippi Laundry Service contract with SRHS, a rumor that Hospital System spokesman Richard Lucas flatly said was not true (see link in preceding paragraph).  Its the ultimate conundrum folks because I have people that still insist there is a money connection between MLS and SRHS.  I mention this because I think there is a good explanation out there that resolves the riddle. Consider this a teaser but it is best that we wait while Slabbed procures the proverbial smoking gun before we solve it.

Way back in the beginning of this whole SRHS disaster I started to write what I’d term a “framing post”.  I use the term “framing” because in order to understand what is happening it helps it you view the chain of events through the proper lens.  The PR people at SRHS and the Jackson County Board of Supervisors have literally been “framing” the problems at SRHS since early in 2014 and how they presented the problem at the SRHS to the public still permeates the discussion.  My issue with how the problems at SRHS have been framed by the spin doctors for the politicos and the Hospital system is that it contains copious amounts of bullshit, for lack of a better term.  The retirees on fixed incomes whose pension income from a life’s work is now at risk demands that Slabbed take a look at the real issues involved with the SRHS financial meltdown and what had to have happened behind the scenes for it to occur.

Finally, speaking of framing, Kingfish up at Jackson Jambalaya is on the right track with the post he did which looked at five years worth of financial data from the Hospital system that is well worth the read.

Analysis: Rumors of sweetheart insider contracts swirling around Singing River Hospital (Updated)

UPDATE:
Since this post was published Slabbed was contacted by Singing River Hospital Spokesman Richard Lucas. This snippet tells the tale:

Our laundry contract, as it has been for many years, is with Crown Health Care Laundry Services out of Pensacola, Florida. We do not have nor have we ever had a contract with Mississippi Laundry Services.

I appreciate the fact that Mr. Lucas contacted Slabbed with that clarification. The other entities are now screaming “follow-up” and I will be doing just that to see if we can gain additional clarity. That will be in part two. ~ Doug

By now anyone with any sort of remote connection to the Jackson County political establishment has heard the rumors of sweetheart deals between the Singing River Health System and certain insiders.  Those rumors have been alluded to several different places and that makes this post a twofer as Slabbed will explore these rumors, why people are talking (beyond the obvious in the implosion of the employee pension fund due to management willfully not funding it) and plus that twofer in how this internet thingy works.

I begin with the DMR = SRHS meme, which first surfaced here in the local feedback loop with the feedback loop confirmed here.  The gang at Singing River Hospital are no doubt feeling a bit embattled and rightfully so.  Pundits, bloggers and muckrakers are a competitive group and there was no way I was gonna let Wayne Weidie have all the fun no sir. Two days ago I sent the following email (partially redacted for dramatic effect) to Hospital Spokesman Richard Lucas:

Mr. Lucas:

I am the publisher of the Slabbed New media website found at www.slabbed.org. I have been following and have covered certain aspects of the financial problems being experienced by the Singing River Hospital System. Along those lines several of my readers have sent me tips regarding alleged insider sweetheart contracts between the Hospital, Hospital <redacted> , and Mr. <redacted> son. Additionally one of the companies is allegedly also owned by Scott Walker, who is now in Federal Prison.

While these contracts may be shielded by the exemption enjoyed by the Hospital in the Mississippi Public Records statute I am contacting you to confirm or deny the existence of these related party transactions. If the answer is none of your business under the Mississippi public records law, that is fine too. I simply want to give you guys a chance to respond in advance of my upcoming publication on this topic and the rumors swirling around SRHS.

<redacted>

Thank you for any information you can provide me regarding these companies and their dealings with SRHS.

As I write this my email to Mr. Lucas has not garnered a reply but the next morning this appeared in the Mississippi Press: Continue reading “Analysis: Rumors of sweetheart insider contracts swirling around Singing River Hospital (Updated)”