My little bro, Matt, has created quite a firestorm of activity after he pointed out the fact that the Liberal "audit" was no such thing, as it was only conducted on those select bits of information that the Liberals chose to disclose to their auditors, PWC and Deloitte.
Matt raised the issue of whether or not the large amounts of donations by the accounting firms to the Liberals created a conflict of interest. Well, it did, and in all likelihood, the accounting firms in question did cover their butts by not doing a technical audit, which requires the opinion of the auditor concerning the integrity of the financial statements. So this begs the question - why do the Libs claim that their books are clean when A) the assessment was done on pre-selected bits of data and B) the accounting firms presented no opinion on the matter?
If I were a Chartered Accountant, I'd be wondering why the Liberals are claiming that their books are somehow "clean", because the condition of "clean books" requires the opinion of the auditor. The Libs are engaged in gross misrepresentation of fact when they claim to have been audited by a big four firm. One wonders why PWC and Deloitte have not clarified the difference between the audit they performed and the audit the Liberals claim they had done.
But back to that conflict of interest. The accounting firms are cleared for legal liability because they did not technically endorse the Liberals' books as clean - there was no opinion on the matter. So, even though PWC and Deloitte have donated huge sums of cash into Liberal coffers, their butts seem covered. As for the Liberals, well, that's another matter.
Case in point: Pierre Pettigrew. Did you know that Pierre Pettigrew, Minister of Foreign affairs was the former vice-president of Samson Bélair Deloitte & Touche International (Montreal) from 1985 to 1995 where he acted as a business consultant to companies with dealings in international markets?
It turns out that Matt may not have been the first to spot the issues embedded within this Liberal "audit". Back in February, Hugo Roy of the National School of Public Administration stated that: "the first thing that people will ask is, 'Is that firm a friend of the party? And the obvious answer is yes."
CTV was quick to point out that the Liberals had hired a "Friend of the Party" to do their books. But to Matt's credit, even back then people were assuming that the Liberals were subjecting themselves to a full-fledged "Gang Audit" where an army of accountants shows up and combs through the account data with a fine-toothed comb of analytical tools.
I can just picture the conversation that may have occurred between Pierre Pettigrew and his old pals at the Montreal Deloitte office:
Pierre: "We're gonna need our books done to make it look like all our dealings were properly issued and receipted - any suggestions?"
Deloitte: "Well, in this post-Enron, Arthur-Andersen world, we can't cook the books like might have done back before you went into government, Pierre".
Pierre: "What do you mean?"
Deloitte: "Pierre, when you request an audit, we'll have to show the good things with the bad, you do realize that, right?"
Pierre: "Non. I pay you good money so you can donate it back to the Liberal Party, and if you scratch my back, I'll scratch yours - you know, just like Chretien"
Deloitte: "Pierre, no. If we did an audit, we'd have to tender an opinion on the matter and actually endorse the books. We can't guarantee that we'll endorse them"
Pierre: "No, I'll give you the best info we have, so I can guarantee that you will endorse these books. I used to work for Deloitte, so I know what looks good and what doesn't"
Deloitte: "Yes Pierre, but you were a business consultant, not an auditor. If you spent more time in the audit department, you'd understand that we need everything. And by everything, I mean..."
Pierre: "Ah, Taber-effin-nac!"
Deloitte: "Here is what we can do, Pierre. We can look at what you submit and basically report on it, but not endorse the books . . "
Pierre: "Well, that's all I want - a big-four accounting firm's name on the books!"
Deloitte: "Okay, but please understand that this is not going to be an audit, all right? We don't want people getting the wrong idea. Plus, do I need to remind you that there is a conflict of interest here? If we endorsed the books, any accounting student with an interest in the PMO will point that out. Promise that you won't misrepresent our services".
Pierre: "Promise? What's that?"
Deloitte: "Never mind. Just don't claim that it was an audit".
Pierre: "An audit? I asked you to do the books for me!"