Cass County Outside Auditor’s Report for 2010

The anticipated auditor’s report by Trout, Beeman & Co., CPAs has been released.  In the case of some officials in Harrisonville, feared may be the appropriate adjective.  You can read the report on the Cass County Auditor’s webpage. If you have difficulty finding the report, you can find a copy at an alternate site here.

I had anticipated rising early this morning to read the document and to highlight items in the report of particular interest.  Unfortunately, as happens from time-to-time, I had an attack of insomnia and didn’t get to sleep until well after 3:00AM. Instead, I’ll read the report and give a better review in the coming days.

The link above is to a copy of the report. You can read it for yourself.  The bottom line you’ll find, as am I, is that our County government must have been filled with incompetents to have done what the reports reveal.  The introduction of the report contains these two paragraphs.

Our consideration of Internal control was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be significant deficiencies or material weaknesses and, therefore, there can be no assurance that all such deficiencies have been identified. However, as discussed below, we identified certain deficiencies in internal control that we consider to be material weaknesses.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis.

When a CPA says there are “material weaknesses,” managers in the private sector think, “OMG!!! I’m gonna get fired, sued and never work again!”  I once worked as a Data Systems Auditor for a large KC CPA firm. Our audit team used that phrase in a report to a large corporation. After reading the report, the Board of Directors fired the CEO, CIO and CFO. Those two words are significant and that was just the first page of the Trout-Beeman report.

I’m sure the white-washing and finger-pointing will commence immediately. I’ve had hints that it has already started. I wonder what the editorial for the Harrisonville Democrat-Missourian will say in this week’s issue?  If last week is any judge, I’ll bet a buck the white-wash has already been ordered.

 

 

Friday Follies for August 3rd, 2012

It’s time for the Follies again. As usual, it’s because I have not found a core topic of the day.  This week has seen a momentous event. Christians and conservative fighting back against the liberal tyranny.

The Huckleberry is taking credit for Chick-Fil-A appreciation day. Truth be told, I think it was a spontaneous event. I heard too many commentators say the same before Huckleberry’s radio  program was aired.  Be that as it may, everyone, especially the libs, were surprised by result. 

Here in Kansas City, lines of cars were blocks long to enter the Chick-Fil-A drive-through.  The local TV stations, the Fox affiliate excepted, barely mentioned the event as did the KC “Red” Star.  If I remember correctly, the Star placed a small report about the size of the response on page eight.

Even cartoonists got into the act.  The best I saw was the one below by Glenn McCoy.

Chick-Fil-A Appreciation Day***

Missouri’s primary approaches. I’ve been an outside observer in previous elections. Other than supporting the generic Tea Party in 2010, this election is the first I’ve taken a more spirited interest.

I have some favorites. Everyone does. It would be unusual if anyone didn’t favor one candidate over another. This election is different for me. I’ve come to personally know—and admire, some of the candidates. I’ve become friends with a few office holders. I’ve also had time to spend some one-on-one time with a number of the candidates.

No election is corruption free. By corruption I don’t mean voter fraud. No, by corruption I mean fraud to the voters. By my observation there are three types of candidates.

The first type and I would hope the majority, are driven to reverse the trends our county, our state and our nation has created—debt, loss of liberty, purposeful malfeasance by government officials and an agenda to destroy our historical and cultural traditions.

The second type of candidate is plentiful, too.  He’s the good ol’ boy who believes that since he has, “paid his dues,” he deserves to be elected or elevated to office.  All too many of these expect and receive the support of the political establishment because, “It’s their turn.”

Frequently you can recognize them by their campaign strategy. They are the first to start slinging slime and mud, spreading lies about their opponents while saying nothing about their own philosophy and accomplishments. Probably they are silent about their accomplishments because they have none.

That in itself is a sad state of affairs for those already in office. When their record is nothing more than, “Me, too!” it makes you wonder just what their qualifications actually are. My rule of thumb when a candidate initiates a smear campaign is to vote for the other candidate—or in a multi-candidate field, the recipient of that smear.

I can’t abide a liar. I personally vet the claims of the candidates. When I determine who is the liar, I support his opponent.

The third type of candidate is the worse. These are the corrupters. Oh, they don’t believe they are corrupt. They just take advantage of the opportunities of their offices.  Cass County has a history of corruption covering decades. The corruption has existed so long that many from both parties believe it has become standard practice. Even with the rise of the ‘Pubs in the county these last few years, corruption still exists and major and minor scales.

We have an excellent example of this minor corruption just now being exposed. I don’t have to name that example. It has appeared in the local news outlets already.

Misuse of public funds is frequently the result. It matters not if it is through nepotism, taking personal advantage of no-bid projects, or wasting money to gain favor through corporate welfare, these pols will eventually be found and exposed. It is those of that same mindset that we must remove from office or insure they never achieve it.

Am I disappointed in my fellow ‘Pubs?  Yes, to an extent. I know that some who may win next week are truly unfit for office.  Will I vote for them next Fall? Reluctantly, yes. Unfit they may be, but on their worse day, they are still better than a democrat.

Or at least I hope so. Saying that exposes the sad state of our nation, state, and county.

Business Ethics, or…

John Stossel has an interesting column this morning, Keeping Business Honest. The theme of his column is that “business” desire for profits is a good thing.

Instinctively, we look for people’s motives. We need to know whom we can trust and whom we can’t. We’re especially skeptical of business because we know business wants our money.

It took me too long to understand that business’s desire for profit is a good thing. To get our money, businesses — if they can’t look to the government for favors — need to give us what we want. Then they must make continuous improvements and do it better than the competition does.That competition is enough to protect consumers. But that’s not intuitive. It’s intuitive to assume that competition isn’t really consumer protection and that experts at the FDA, FTC, DEA, FCC, CPSC, OSHA and so on must protect us. These experts consult “responsible” businessmen for advice on creating rules to make sure businesses meets minimum “standards.” — Washington Examiner.

The down side is that regulations, created by local, state and federal agencies, intended to “level the playing field” stifle innovation. Under the camouflage of consumer protectionism, licensing and other business restrictions have a tendency to make innovation, business startups and competition difficult. The result is protectionism. the question is, what is being protected.  Stossel provides some examples.

Las Vegas regulators require anyone who wants to start a limousine business to prove his new business is needed and, worse, will not “adversely affect other carriers.” But every new business intends to beat its competitors. That’s the point. Competition is good for us. Las Vegas’ anticompetitive licensing rules mean limo customers pay more.

In Nashville, Tenn., regulators ruled it illegal for a limo to charge less than $45 a ride. One entrepreneur had won customers by charging half that, but the new regulations mean the established car service businesses no longer have to worry about him.

Perhaps Nashville’s and Vegas’ regulators really believe “this is an area where the free market doesn’t work,” as the manager of the Nevada Transportation Services Authority put it. But it’s fishy that charging big fees for licenses just happens to be a very effective shakedown operation. Vegas cab and limousine businesses give “substantial” donations to Vegas-area political candidates, according to the Las Vegas Sun. — Washington Examiner.

Stossel makes an interesting point in that last paragraph.  It has parallels locally.

Up until a month or so ago, my home town had a tax on businesses. It was a one time tax on new businesses who constructed a building for their business or expanded their existing place of business.  Supposedly the tax was to pay for increased use…at that location…of city resources such as street maintenance, water, sewer and power usage.  Basically, infrastructure costs. The tax was not levied if a business moved into an existing structure and did not alter the building beyond the usual interior make-over. No, it was targeted towards new or growing businesses.

The tax created a reluctance of new businesses to come to our city.  From the statement of a former councilman, who was not re-elected to the council after saying, “We don’t need more burger-flipping jobs here.” 

I was present when that statement was made. Shortly thereafter the council repealed the tax.

Was the purpose of the tax to discourage businesses, business startups without the capitalization of a large company, from doing business here? “We want good jobs!” was one reasoning. I would submit that to one without a job, ANY job is a good one, burger-flipping or not. Perhaps the exposure of one purpose of the tax was sufficient to overcome the reluctance of other members on the council who had previously supported the business tax.

That local tax was repealed just before our local city elections. Since then we’ve already seen fruit of the repeal.  Our local Micky-Ds has renovated their building.  Did it add new jobs? Probably not.  Would the tax have applied to the renovation if it had still existed? I don’t know.  But we have other evidence that the lack of the tax is bringing new jobs to town.  Next week we’ll have a ground-breaking on a new Steak ‘n Shake.  The tax would have applied to them because they are building a new presence on an empty lot.

Yep, a new business and a half-dozen or more new jobs. Minimum wage? Probably, but to someone without a job, minimum wage is attractive.  Remember the original purpose of minimum wage: a starting wage to gain experience to allow the worker to build skills useful for acquiring a better job.  It may be those skills are simply coming to work on-time, every-time, and putting in a full-shift.  You’d be amazed how many job-seekers lack those basic skills.

So let’s ask ourselves, what is the purpose of these regulations, these taxes? Are they for consumer protection? Are they to preserve city resources? Or, are they to protect favored cronies or simply to make doing business more difficult?

The economic recovery of our country…post Obama, will be difficult enough without our adding to those difficulties through the imposition of anti-business taxes and regulations. Remember, juvenile unemployment is above 50% in some areas. We need to be pro-business, especially to startups. That is where jobs are created. And burger-flipping frequently is an eye-opener to our young folks just starting or approaching adult life. They need jobs and experience, too.

Promises vs. Commitments

This may be a bit different from my usual run of posts.  The world abounds with examples of people, families, businesses, and governmental entities making promises and then failing to keep those promises.  When this happens the recipients of those promises are up in arms.  And, in some cases, rightly so.  But a promise is NOT a commitment.  There’s a difference, albeit in the view of some, a minor one.

If you look up the words in a dictionary, both are viewed as legally binding, but are they?  In real world usage, both are verbal.  If they are written, they become something beyond a promise or a commitment. If written, they become contracts and covenants.

A promise, in my opinion, is to make a best effort to accomplish a goal.  “I promise to cut the grass tomorrow.”  If conditions grant that the task can be done, it will be done. But, if tomorrow brings a constant rain, no one expects me to be mowing my grass in the rain.  To make a promise then, is to make a “best effort, barring unforeseen occurrences” to accomplish that which has been promised.

A commitment, however, is different as I was taught by my old boss.  If you make a promise and fail to meet it, you’ll likely get another chance to complete that promise although not as original conceived.  A commitment means if you don’t deliver as specified, you’re fired!

Consequently, you’ll not be surprised that I make few commitments. I do make promises and do my best, when I do, to meet those promises. But a commitment…ahhh, that’s different.

When I married my wife, I made a commitment to her.  My vows were standard, love, cherish, be faithful.  I did not make a promise. I made a commitment and I’ve kept that commitment for…uh, lemme see now, 43 years.  A commitment means keeping that vow regardless of personal issues, regardless of unforeseen circumstances, regardless of the unexpected, regardless of “acts of God.”

It’s not surprising that people confuse the two.  A local example occurred this year with my county government.  There is a county road that passes a couple of schools and has heavy traffic.  It is narrow and needs to be widened.  A promise was made to the local residents to widen the road.  Funding for the project came from a number of sources, some from the state, some from a bond issue, and more from the county’s general budget.

Then reality hit.  The county government made some bad estimates in revenue.  They thought the revenue stream, all from a county sales tax, would grow at a small rate.  It didn’t. With the recession/depression, people started conserving. They bought less, only those items that were necessary.  The county income failed to meet the amount required to fulfill the promises made by the prior political incumbents.

Promise meet commitment.  The road project was a promise…until conditions changed that made meeting the promise untenable.  The county has/is/will cut expenses.  People have been laid off. Routine maintenance has been slowed.  State revenues are also down and money from the state for road projects have been cut as well.

Promise meet commitment.  When the choice is paying for lights at the County Jail and Sheriff’s office or using that money to widen a road, which has priority?  The county has a commitment to keep the Sheriff’s office running. The road project is a promise. See the difference?

Consider all the examples of these two.  Some consider Social Security and Medicare commitments. Others, myself included, consider them promises. Until the 1930s, Social Security did not exist. Until the late 1960s, Medicare did not exist.  When my mother was diagnosed with cancer in 1960 there was no Medicare. She had private insurance from two sources. One as a benefit of being an elementary school teacher and the other as being the spouse of a UMWA member.  From whom was the promise of healthcare?  Certainly it was not from the federal government.

Therefore, what is the commitment of the federal government? There is only one: to uphold and defend the Constitution.

All else are nothing more than promises. As we move towards the future, let’s not be confused with governmental promises and commitments.

They are not the same.                           

Off to India at Taxpayer’s Expense

Have you heard about Obama’s upcoming trip to India? It includes around 3,000 people and will cost $200M a day!!! That means the total cost of the 10-day trip will reach $2Billion!!!

What a waste. A total waste. I remember some Presidential trips in the past that contained only three aircraft—one for the Prez and his troops, one for security and their equipment and one for the press. In some cases a C-130 preceded the group if a car or other special equipment was needed.

Obama on the other hand is taking 3,000 people in 40 jetliners. They are taking over an entire 570-suite hotel. He’s even taking his teleprompters with him. When he speaks to the Indian Parliament, it will be the first time teleprompters have ever been used in that forum.

Now there is a report that he’s also taking 34 U. S. Navy warships along as well!

He (Obama) will also be protected by a fleet of 34 warships, including an aircraft carrier, which will patrol the sea lanes off the Mumbai coast during his two-day stay there beginning Saturday. The measure has been taken as the Mumbai attack in 2008 took place from the sea.

Obama is expected to fly by a helicopter — Marine One — from the city airport to the Indian Navy’s helibase INS Shikra at Colaba in south Mumbai.

From there, he will drive down in a Lincoln Continental — the Presidential limousine — to the nearby the Taj Hotel.

Two jets, armed with advanced communication and security systems, and a fleet of over 40 cars will be part of Obama’s convoy. — Press Trust of India, Updated: November 04, 2010 19:04 IST

How much will that cost? It will cost more than $200M a day to move that naval fleet to India. What a total waste. I haven’t heard any outcry yet about this fiasco. There should be. At a minimum, the Two Billion Dollars wasted on this trip should be deducted from next years White House budget. The new Speaker of the House, John Boehner, said the ‘Pubs would be cutting spending. Eric Cantor agrees and has a plan. Cutting the White House budget is a good start.

And, while we’re at it, let’s defund and eliminate all those “Czars” and new agencies Obama created without congressional approval.

What say you?

Off to India at Taxpayer’s Expense

Have you heard about Obama’s upcoming trip to India? It includes around 3,000 people and will cost $200M a day!!! That means the total cost of the 10-day trip will reach $2Billion!!!

What a waste. A total waste. I remember some Presidential trips in the past that contained only three aircraft—one for the Prez and his troops, one for security and their equipment and one for the press. In some cases a C-130 preceded the group if a car or other special equipment was needed.

Obama on the other hand is taking 3,000 people in 40 jetliners. They are taking over an entire 570-suite hotel. He’s even taking his teleprompters with him. When he speaks to the Indian Parliament, it will be the first time teleprompters have ever been used in that forum.

Now there is a report that he’s also taking 34 U. S. Navy warships along as well!

He (Obama) will also be protected by a fleet of 34 warships, including an aircraft carrier, which will patrol the sea lanes off the Mumbai coast during his two-day stay there beginning Saturday. The measure has been taken as the Mumbai attack in 2008 took place from the sea.

Obama is expected to fly by a helicopter — Marine One — from the city airport to the Indian Navy’s helibase INS Shikra at Colaba in south Mumbai.

From there, he will drive down in a Lincoln Continental — the Presidential limousine — to the nearby the Taj Hotel.

Two jets, armed with advanced communication and security systems, and a fleet of over 40 cars will be part of Obama’s convoy. — Press Trust of India, Updated: November 04, 2010 19:04 IST

How much will that cost? It will cost more than $200M a day to move that naval fleet to India. What a total waste. I haven’t heard any outcry yet about this fiasco. There should be. At a minimum, the Two Billion Dollars wasted on this trip should be deducted from next years White House budget. The new Speaker of the House, John Boehner, said the ‘Pubs would be cutting spending. Eric Cantor agrees and has a plan. Cutting the White House budget is a good start.

And, while we’re at it, let’s defund and eliminate all those “Czars” and new agencies Obama created without congressional approval.

What say you?

Addendum to Obama’s Financial Reform

I don’t normally post more than once a day, but this quote is sooooo on topic, I couldn’t resist.

Obama and the libs held a “financial responsibility summit” in the White House. The Heritage Foundation reported, President Obama held a “fiscal responsibility” summit designed to “send a signal that we are serious” about putting the nation on sounder financial footing.”

The Washington Post’s Dana Milbank said…

“Holding a ‘fiscal responsibility summit’ at the White House in the middle of a government spending spree is a bit like having an Alcoholics Anonymous meeting at a frat house on homecoming weekend.”