SEVU Auditing Procedures?
We all know the saying “Follow the Money”. SEVU spent $2,056,403 on Advertising & Promotions during the FY just reported. The fact that this exceeded the TOTAL REVENUES for the company BY A FULL 81% is indeed incredulous. Many of us have commented on that here.
As I understand it, when a year end audit is conducted by an independent auditing firm, for the purpose of certifying year end results, the auditing firm looks at supporting documentation, and will not certify the audit until it is satisfied that it has seen enough documentation to be confident in it’s results.
However, if a company CLEARLY spends an inappropriate amount on advertising, and all of that expenditure is funneled through a company owned by the principle shareholder of the company spending the money, does the auditor have a responsibility to insist on proof that the company received what it paid for?
In other words, did the certifying CPA just accept invoices from RM McBride and Associates, or, because of the obvious potential conflict of interest, require proof of money spent?
Just curious,
Bill Branum
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