Author Archives: admin

IVGID’s Auditor refuses to issue audit opinion

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[Update Oct 11, 2024: The Nevada Department of Taxation issued a letter to IVGID saying they have not complied with NRS 354.624(4);  a disclaimer of opinion is NOT an opinion. The letter is below. The “damages” are the cost of doing the audit again – which is what will be required for IVGID to be in compliance.] CPA firm Davis Farr issued a “Disclaimer of Opinion”  letter to the Incline Village General Improvement District for the audit of its fiscal year ending June 30, 2023.  A disclaimer of opinion means there was not sufficient, appropriate evidence for auditors to even … Continue reading →

Appeal of signature verification for recall petition of IVGID Trustees denied

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The Nevada Secretary of State’s office denied the appeal of the verification of signatures for petition to recall the Incline Village General Improvement District Trustees Sara Schmitz and Matthew Dent. In two letters dated March 1, 2024, NV SoS Deputy Secretary  Gabriel Di Chiara concluded, “In summary, the Secretary of State finds the petition remains insufficient. No further action will be taken on the appeal.” Letter re: Sara Schmitz Recall   

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Forensic Audit Authorized – but will it be a white-wash?

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After years of residents’ complaining, the Board of the Incline Village General Improvement District (IVGID) authorized a forensic audit in November, 2023. This seemed a step in the right direction. Especially since, in October, 2023, we wrote how expenses had been hidden by IVGID for decades. This is financial statement fraud – like WorldCom in 2002.   link 1   link 2   link 3 We have also written about the financial systems meltdown after a failed accounting and payroll implementation and no fixed asset inventory for a decade or longer. link 1  link 2 Original Forensic Audit Scope In September, 2023 IVGID … Continue reading →

IVGID’s Financial Meltdown – Part 2

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[UPDATE: Sunday, Nov 5, 2023 Several residents have emailed us expressing concerns and asking what they can do. We have some solution-oriented ideas and would like to share them with you. Email us at village_alliance at ourivcbvoice.com ] If you spent over half a million dollars for a computer system, wouldn’t you expect your staff to ensure the system worked before you turned off the old system?   This would be normal for a financial systems conversion. Some organizations elect to “run parallel” with their old system for several months to gain confidence and experience.   But not the Incline Village … Continue reading →

OPINION: Cooking the Books – Part 3

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This article examines the Land in the Utilities account:  $6,715,543.64 according to the audited financial statements (6/30/2022). That $6,715,543.64 matches the Fixed Asset Ledger-Land-Utilities  exactly. That should be good – but it’s not. Why? Because the ledger does not contain accurate, supporting details. Only one item in the ledger contains  a parcel number. The FA Ledger for Land – Utilities ties exactly to the audited financials for 2022 back to 2009:  $6,715,544. And then from 2007,  the numbers don’t match  (graphic)– until magically they again match in 1990.   This is evidence the FA Ledger was created to tie to … Continue reading →

Recall fails to gather sufficient valid signatures

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The recall effort failed to gather sufficient signatures. The minimum requirement to qualify for a recall special ballot: 1801 valid and verified signatures of voters in the 2020 election. For IVGID Trustee Matthew Dent, there were 1,726 valid signatures submitted. For IVGID Trustee Sara Schmitz, there were 1,687 valid signatures submitted.. Both fell short. The process is now over unless there is a challenge with the Secretary of State.

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Forensic Audit: The need to investigate accounting fraud by past IVGID management

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On August 24, 2023, the IVGID Board of Trustees voted to perform a forensic audit on IVGID’s accounting and financial reporting. A request for proposal to seek a qualified CPA firm to perform a scope of work is in process.  It is estimated that the costs could be as high as $150,000.  This audit has been prompted by a continued need to adjust prior period financials, outside auditors concerns about material weaknesses in internal controls, resistance to accept Audit Committee recommendations by management and some Trustees, and false statements made by management in the Representations Letters provided annually to the … Continue reading →

OPINION: Cooking the Books – Part 2

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On October 20, 2023, we obtained audited financial statements back to Fiscal Year 1990 for the Incline Village General Improvement District. Analyzing the data, we can now state that the fraud explained in Cooking the Books (Part 1) has been ongoing since 1990, and likely before that time. In that article, we explained that IVGID had improperly capitalized costs as LAND, and that this scheme is one of the ten most common fraud schemes involving financial statements. We analyzed data from audited financial statements CAFR/ACFR 2009 to 2022. With the older CAFRs obtained (1990 – 2007: links at end of … Continue reading →

OPINION-Is  IVGID management investing cash correctly?

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At June 30, 2022, the District had $49,947,779 in cash, yet according to the audited financial statements, the investment of the cash lost $110,920.  How is that possible? Almost  $15 million is in checking accounts and probably earn no interest.  But what about the other $35 million? Here is the breakdown: 1) Certificate of Deposits of $1.4 million with maturities spread equally between 2025 and 2027. 2) Government Agency Securities of $3.4 million with maturities spread equally between 2023 to 2026. 3) US Government Money Markets funds of $14.7 million have maturities of one year or less but the yield … Continue reading →

OPINION: Cooking the Books – Land misstated by IVGID for over a decade

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Organizations “cook the books” when they use accounting schemes and tricks to falsify their financial statements (i.e., their books) to make their results appear better than they actually are. One of the ten most common schemes: “Improper capitalization of expenses occurs when a company capitalizes current costs that do not benefit future periods. By doing so, a company will understate its expenses in the period and overstate net income. The most well-known example of this scheme involved WorldCom, in which the company overstated its net income by more than $9 billion by, among other accounting tricks, improperly capitalizing operating expenses.” (National … Continue reading →