January 24, 2000
Letter
from CPA Stan Myrda to Harley Coon:
[KWE Note: Myrda responds to Coon’s message about hiring of
another CPA.]
To:
Mr. Harley J. Coon, President
Korean War Veterans Association
c/o 2439 Lantz Road
Beavercreek, OH 45434
RE: Your letter dated September 20, 1999
Dear Mr. Coon and Board of Directors
Regret not responding to our letter sooner as it was impossible
to answer your specific questions at that time. I will address
the issues in the order in which they are discussed in your letter.
1) Your request for a final invoice.
At this point, I can only send you a work in progress billing,
which will be forthcoming soon. Until all of the financial activity
under Mr. Maison’s tenure is reviewed and the claim has been
settled with the insurance company, professionally my task is not
done.
The final billing will not be forthcoming until the case is closed,
however, interim billings will be made.
In my discussion of the matter with Retired Supreme Court Justice
Joseph Cunningham, I discussed the termination of the audit and
filing a claim for any additional funds appropriated by Mr. John
Maison and its potential legal ramifications. If it was established
that there were misappropriated funds unaccounted for, and the
audit was intentionally terminated by President, the question is
whether Board members or KWVA members could take action against
the President or the Board for failure to recover all the funds
misappropriated within reason. Reason being that all areas covering
Mr. Maison’s tenure should be reviewed to determine if potential
or appearance of misappropriation of funds was present, in light
of what has occurred during the other period examined.
2) How many dollars do you estimate that we can recover? Presently
we have filed a claim for over $60,000 for credit cards charges
that had been denied by the insurance company on its face, with
a position that there is no supporting documentation or that the
expenditure was beneficial to the KWVA.
These items had to be researched as to vendor, expenditure, and
whether the expenditure had or had no relationship to the KWVA
purpose, objective and operations. Example; Pornographic film purchased
by Mr. John Maison with KWVA funds, telephone equipment, ADT service
for his residence, and the list goes on.
3) Investigation of expenditures unauthorized and with no relationship
to the KWVA takes time. One invoice may take two (2) to three hours
(3), locating the vendor, finding the right person to talk to,
convincing the individual to share some information with you, regarding
the when, what, where, and why relating to an expenditure to establish
that it had, or did not have any relationship to the activity of
the KWVA. Sometimes, you can not determine who the vendor is, or
what the expenditure is for, or the vendor location, telephone
number, or the market the vendor serves.
Regarding a written contract, at this point of the investigation,
I will not sign any written contract, as I have reached an understanding
of my responsibilities with the Board of Directors at the time
the audit was approved by the Board of Directors, you made the
motion. I stated that the hourly fee would be approximately $50.00
an hour. I initially charged $45.00 per hour. The engagement was
to review the period during which Mr. John Maison was Treasurer
for potential misappropriation of funds, and to file such claim
as was necessary with the insurance company to recover the funds
and any follow up necessary to substantiate the claim. This is
my understanding, it is Nick Pappas’s understanding, the
FBI and the IRS understanding of my status in this audit.
I do not feel it is time for us to spend cost and time discussing
what my responsibility are and the what [sic] Korean War Veterans
responsibility is.
Within the last 30 days the FBI had contacted me in regards to
a specific item in the original claims book. The FBI is also investigating
the matter. However, they have the same problem I have, and that
is being able to devote all of their time to one specific case
or client.
As was understood at the Board of Directors meeting, all of this
work is being done between other legal commitments and clients.
In exchange for this, we have kept the hourly rate basically the
same since the inception of the engagement.
The statement above is my understanding with the Board of Directors
that appointed me. This was my position at the original board of
directors meeting that approved my appointment to audit all of
Mr. Maison’s activity as Treasurer, and to prepare the claim
documents and to follow up as necessary. At that time, that the
hourly rate would be $50.00 per hour. However, if I suspected it
would have taken this length of time, I would have factored in
a cost of living increase. Compare that to what other CPAs charge
per hour for this type of an engagement and you would find that
for this type of engagement $75.00 to $120 per hour is reasonable.
Since this defalcation occured under Mr. Pappas’ tenure,
I will continue to deal with Mr. Pappas on any questions relating
thereto.
All records relating to the audit period will continue to be maintained
in my office until the final claim is made and the final settlement
is received from the Insurance Company.
I have provided to you, the current President, copies of all filings
to date with the insurance company. This included copies of the
unauthorized and unrelated expenditures with copies of the invoices
and statement of position on each unauthorized expenditure.
If you have any further questions, please put them in writing.
A copy of this letter is being provided to the members of the Board
of Directors. This is my policy to assure that each member is fully
informed, since the Board meetings are only held at certain times
during the year. I appreciate your help and Mr. Pappas’ help
in try [sic] to bring this to conclusion as soon as possible.
Respectfully,
(signed) Stan Myrda, CPA
cc: Board of Directors
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