In the San Diego Union-Tribune this morning, excerpts from an interview with outgoing Southeastern Economic Development Corporation (SEDC) president Carolyn Smith left me with a lot more questions than answers.

The story on the interview excerpts: http://www.signonsandiego.com/news/metro/sedc/20080812-9999-1m12sedc.html

The entire interview is allegedly accessible from the above web page. I didn't check it myself, as I could only stomach the printed excerpts before running for an old copy of Pyle and Larson's Fundamental Accounting Principles for what it has to say on page 5 about AUDITING...

"The principle service offered by a public accountant is auditing. ... The purpose of an audit is to lend credibility to a company's financial statements. In making the audit, the auditor carefully examines the company's statements and the accounting records from which they were prepared. ..."

I'm sorry, but according to Pyle and Larson's definition of auditing, there is no evidence that at any time during Ms. Smith's 15-year SEDC presidency, there was an actual audit ever performed on the SEDC books... or all of that allegedly-audited fiduciary funny-business would have come to light fifteen years ago.

There is no word on whether the pseudo-auditor over the last fifteen years at SEDC was the same pseudo-auditor back when Reese A. Jarrett was president of SEDC.

Comments

TMIB Aug. 12, 2008 @ 11:26 p.m.

I hope Smith, gets what she deserves.

Karma and be a bad thing.

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JustWondering Aug. 13, 2008 @ 7:13 a.m.

Some more interesting facts are coming out about San Diego's redevelopment "corporations", CCDC and SEDC. One of the telling facts; this model ONLY exists in San Diego. The big question is why? Given San Diego's lack of EFFECTIVE oversight on almost EVERYTHING having to do with government it appears this is just one more sad example.

Being a bit cynical I see this more same duck and cover from our elected leaders. No one is ever held accountable. Given the history of San Diego's city council members it's not surprising.

We are also in the process of discovering Ms. Smith "termination" agreement MAY hold some clauses which will prevent the City from recovering her ill gotten gains. These so-called bonuses the taxpayers NEVER intended may NEVER be recovered. Where was the leadership from our CEO, Mayor Jerry Sanders? Who approved this?

While I believe Ms. Smith began working at SEDC with best of intentions years ago, why, or more importantly HOW did this happen? As you mentioned “... The purpose of an audit is to lend credibility to a company's financial statements. In making the audit, the auditor carefully examines the company's statements and the accounting records from which they were prepared. ..." Even today, after all this City has been through financially, our “new careful audits” are not discovering these highly questionable, if not illegal, (IRS tax code) practices. What is the value of an audit that reports an entity as “clean” yet later we discover tremendous problems? Sadly it wasn’t even subsequent audits that found these problems in 2004, or 05, 06? It was the investigative journalist at the Voice of San Diego who broke the story on rampant corruption at SEDC and now, new problems unfolding at CCDC.

History is suppose to be a teacher, the history of these hybrid corporations run by the City of San Diego, is not what anyone would call shining. Let’s not forget the infamous yet still functioning San Diego Data Processing Corporation. Maybe it’s time for another look at their books too.

If San Diegans ever return ANY of these people to public office, or allow our representatives to appoint them jobs where public dollars are used, we, the people of San Diego, only have ourselves to blame.

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a2zresource Aug. 13, 2008 @ 12:06 p.m.

Response to #1:

Apparently the SEDC board believes she deserves 90 days to put her office right (like it hasn't happened in the last 15 years) and a nice going-away bonus...

Word is that the FBI is looking at CCDC. Can an FBI investigation of SEDC be far behind?

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a2zresource Aug. 13, 2008 @ 12:34 p.m.

Response to #2:

As for how this happened, I am going to go out on a limb and say it is because we don't vet our appointed leaders very well, including their ties to political movers and development shakers who may have something to gain in the selection of non-profit corporate development agency heads.

Even farther out on a limb, I'll say that I remember a time when in a 2-parent household, one worked and the other had time for civic involvement in something needing volunteers, like the PTA, or a scout troop, or some thing that kept at least somebody with at least a high school civics education in the household involved in the community. Now, it takes both parents working like dogs to gas up the car, get to their separate jobs, and pay off the mortgage, subprime or not. Volunteerism and community involvement in a single parent home? You can figure that one out. In any case, when we're too busy to keep an eye on our political leaders, funny things start happening... and maybe go on for a decade and a half.

This is so far out at the edge of the last leaf that I know somebody is going to take a shot... if you've ever attended ANY local California legislative body meeting, you'll notice such a thing called a "consent calendar" or some such device, where multiple items for approval WITHOUT PUBLIC DISCUSSION are all approved on a single vote... which means nobody sitting behind the big raised table in front of the public can ever be found "responsible" for a vote that was never taken on shifting money from one account to another, or approving a "routine" contract for a connected insider... or awarding a president with an off-budget bonus.

Maybe you can understand why I like Don Bauder's blogs... (or why I don't even bother trying to figure out the byzantine system of accounting systems at the San Diego Community College District or any other local government unit.)

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JustWondering Aug. 13, 2008 @ 2:04 p.m.

As a baby boomer who could have joined AARP a few years ago I really don't think you've gone that far out on that limb. In fact, I believe your analysis is close to the mark. And, to tell you the truth, I never really considered the Consent Agenda argument before. But now, after some thought, you're correct. Any item may be placed on the consent agenda. What a wonderfully covert way of bypassing effectitve public discourse. And, if thing don't necessarily work out, a viable and built in excuse is already in place.

I also agreed with the statements regarding two worker families. Being one ourselves we really don't have time. So we happily hired our representatives to look after this for us. Never expecting those folks to be so incompetent.

I'd also argue district only elections have fractured this city into nine mini-cities where we are only concerned about our "voters" and what's good for the entire city in a long term context.

Keeping a Stong Mayor form of government is something I believe in as long as we hold the mayor accountable. But I think we should go back to citywide elections for council members too. Their decisions as a political body effect my life too yet I only have a say in one out of the nine votes. Proving there is little, if any, real accountability.

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a2zresource Aug. 13, 2008 @ 2:17 p.m.

Regarding #5:

I may have opened a real can of worms here.

I suddenly feel like crawling through two decades of SEDC minutes to see just how many things passed through its meeting "consent calendars" without public discussion...

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