Friday, August 20, 2010

Colin Hansen, your pants are smokin'

British Columbia's Auditor General John Doyle says the Liberal government is not following generally accepted accounting principles (GAAP) and understated the 2010 deficit by $73 million. Finance Minister Colin Hansen downplayed the news and stated this was merely a simple disagreement over methods of accounting. He said that Mr. Doyle, having last worked in Australia, has inadequate understanding of Canadian ways of business. That is untrue and Hansen is fully aware he talked nonsense in claiming that John Doyle does not understand GAAP.

The government chooses to misreport disputed financial information because it does not want to admit the policies in play. Particularly, that, at the very time it was slashing public programs, it was gifting hundreds of millions of dollars to wealthy gas and oil producers and making deals in secret with favored contractors to build more than $4 billion of highway and bridge projects in the lower mainland.

Which side do we believe in this variance? Well, Colin, there ain't no way to hide your lyin' eyes. Your record of disrespect for truth is clear.

The position of Auditor General is designed to be worthy of trust; the position of Finance Minister is not. The A-G is selected by all political parties and does not answer to the Civil Service, Premier, Cabinet or any partisan authority. John Doyle is an officer of the legislature, responsible to work without partisanship. This independence is not shared by the Comptroller General who takes direction from senior government officials as recently demonstrated in the politically purposed attack on the Vancouver School Board.

In the absence of material difficulties, auditors ordinarily express an opinion that financial statements fairly present a financial postion according to generally accepted accounting principles consistently applied. Withholding of a "clean audit report" is carefully considered and extensively discussed with top officials of the enterprise under review. Except for cheaters, corporate accountants never face a reserved audit opinion. It is a near universal sign of dishonesty and intent to mislead.

Of course John Doyle, like every other designated professional accountant working in Canada understands GAAP. Even junior accountants on his staff are thoroughly conversant with current standards. For Hansen to state that Doyle lacks appropriate knowledge in this area is to accuse him of a serious professional failing. Similarly, he slanders Mr. Doyle's colleagues who, incidentally, did not come from Australia:

Audit Team:
  • Bill Gilhooly, Assistant Auditor General
  • Peter Bourne, Executive Director
  • Geoff Stagg, Manager
  • Phil Hancyk, Auditor
  • Albert Law, Auditor
Auditor General Doyle says the province's deficit should be higher by $73 million and he says that taxpayer supported debt is understated by $544 million because the government is not accounting properly for the Transportation Investment Corporation.

He also warns that pending changes in accounting standards affect how BC Hydro operations are consolidated. The deficit for 2010 would increase $705 million under the proposed principles. Another shocking revelation in the Auditor General's report is that BC Hydro has over $1.7 billion in expenses that have been incurred but will not be recognized in financial statement until some time in the future. Essentially, they are worthless assets, already consumed with zero liquidity. Some argue the amounts should be shown as an increase of the deficit.

Clearly the Liberal Fudge-it Budget is now more completely revealed. Will mainstream media pundits bother to report the information or will it be undisclosed like other Liberal malfeasance?
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  1. Hey Norman, His pants will be on fire today with the latest HST headline covering most MSM. HST is being blamed for the latest inflation rate increase in Canada. Can it be Norman ? Were the politicians wrong ? Go figure.

    Guy in Victoria

  2. This independence is not shared by the Comptroller General who takes direction from senior government officials as recently demonstrated in the politically purposed attack on the Vancouver School Board.

    Speaking of whom...

    "The Vancouver School Board’s posting of it’s budget information and financial performance is not transparent…The Board of Trustees should provide better contextual and supporting information in their budget documents. This omission leads to misunderstanding and confusion.

    The [VSB] should post all financial information together and provide adequate context and support to ensure greater transparency."

    -Comptroller General Cheryl Wenezenki-Yolland – Report on the Vancouver School Board, June 2010.

    “We are mindful that too much detail can obscure the informative value of the financial statements, that the cost of additional information should not be greater than the benefit received, and that to be useful, financial statements must be presented on a timely basis so that users have the benefit of reliable information that is relevant to their information needs,”

    -Comptroller General Cheryl Wenezenki-Yolland, addressing the Auditor-General’s report on accounting practices used in the annual Provincial Budget, August 2010.

    It's good to be flexible.

  3. Excellent point. Their own words betray them!

  4. I believe this is why Gordo is fighting the anti-HST people so hard. He needs that money. There is much, much more than we are aware of and I think he's trying to buy time to address it as quickly as possible. I think he's convinced the MLAs to ignore their constituents because he's told them they will all be blamed for the mess so they may as well stay and try to fix it asap. These people are not good financial managers. I think we will find that we are hopelessly in debt, bankrupt and have no assets left to rely on. This is the worst government ever! They need to go now!

  5. I too think, Campbell, Hansen and the, BC Liberals, have got this province into, an abyss of debt. I think they are terrified, their debt will be exposed. Hence, the whiting out of, the FOI papers, to conceal the Olympic debt, from the NDP, and the citizens. Campbell is afraid he will be lynched. The BC Liberal Party, is just a crap party, that needs to be dissolved. Be it on their own heads, that the BC ministers and the mla's, of whom, are supporting a corrupt and shameful government. They would stand, a far better chance to save their political career's, by telling Campbell, where to go, and the shortest rout to get there.

  6. And now the previous AG Doyle is suing Christy and Co. Surprise, surprise.



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