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Where’s the Skepticism?

November 4, 2011

Friday Nov 4, 2011

The battle for the dumbest statement of the year by a politician is of course fiercely waged each and every year. But, I do believe, we have if not this winner for 2011, a serious contender. Consider

By law the party chair is supposed to reconcile bank statements for party money every month. When asked why this was not done, Party Chair Carla Vela replied

'We didn't check the statements because we didn't know Mr. Adams was stealing the money'

Vela also admitted statements were put in a drawer unopened.

The requirement of a reconciliation by a third party of course is an internal control to counter the possibility of theft or misappropriation.

Dwayne Adams claimed to have a PhD in Finance and that he was a CPA, if my reading of the article is correct. The failure to check out such obvious claims is simply gross negligence.

Auditors should exhibit Professional Skepticism. The local Democrat Party Chair is certainly guilty of gross negligence in failing to check on all candidates qualifications. I have made a big point in Acct 3301 of why it is important to understand a bank reconciliation. Had this been done, Adams' theft of some $200,000 would have been discovered before the amounts became so large.

Adams is the former Democrat Treasurer accused of stealing $200,000 in Party Money.

Posted in Audit

6 responses to “Where’s the Skepticism?”

Javier Carvajal

November 4, 2011

This is in first place. I can not believe a large party like the democratic party does not have any type of internal control for this.

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Dennis Elam

November 4, 2011

Apparently the Dems have no IC in California as the same thing happened there
and the SEC CME FINRA CFTC had not internal control over MF Global as it blew up last week, now they are interested
gee SARBOX really helped didn’t it

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Luis Martinez

November 4, 2011

I don’t know whether Ms. Vela was appointed or elected to her post, but this incident is a sad statement of the lack of competence in either those who appointed her or those who elected her. She is not qualified and it shows in her reaction to the incident: “We didn’t check because we didn’t know Mr. Adams was stealing…” Really??? Did she realize she said that out loud?

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valentin tristan

November 4, 2011

Just because a person gets a dregree, does not mean they are smart or competent in their job.I am assuming Ms. Vela has a college degree since she is the Party Chair of the local Democrat party.

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Yesenia Banuelos

November 11, 2011

I agree with Valentin,just because you get a degree doesn’t mean you understand what you been taught. Ms. Vela should of been checking regardless if she thought someone was stealing.

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Dennis Elam

November 11, 2011

You got it Yesenia! by the way Dwayne Adams got six years to do, I however would make him repay the money he stole.

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