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Meatworkers Union – Failure to Disclose

by Whaleoil on November 15, 2012

For Meat Workers Union Members only: presented by the Owl

Dear Meat Workers Union Members:

A number of people have been working very hard on your behalf to ensure you receive the best information available from your unions. We have received major criticism for our persistence in these matters but we are now able to provide you with your correct financial information.

We are not looking for a thank you or anything – we just want you to have the best. For the Owl I believe in process and a great advocate for members. Just like you pay money into kiwi saver there is governing laws around protecting your investment. Unions are incorporated societies and your investment needs to be protected as well. Failure to disclose is a serious matter.

The Owl has tabled a comparison of what was originally filed by your Union in 2011 and what the actual true figures were.

Please note that your Union auditors have stated that in their report “Also we have not been able to obtain sufficient audit evidence regarding revenues and expenses relating to Hawera Sub-Branch and 2010 comparatives of Otago Southland Branch”. These are not our words but your auditors.

The Owl does not dig around in rubbish bins for scandals and only uses information freely available in the public domain. I suggest members write to their Union and seek clarification on any matters.

What is worse – A privacy breach or a failure to disclose?


2011 2011 2011
Expenses  Orginally Filed  The “Real” position  Understated by:
ACC Levy  999  4,177  3,178
Affiliations and Capitation  93,236  93,236  -
Donations & Presentations  24,416  45,796  21,380
Fringe Benefit Tax  4,461  39,008  34,547
Health & Safety  55,743  79,326  23,583
Legal  56,161  350,632  294,471
Meetings and Conferences  160,553  456,598  296,045
Honorariums & Commissions  4,000  87,276  83,276
Salaries & Allowances  170,031  1,203,188  1,033,157
Superannuation  8,405  46,588  38,183
Travelling Car & Air  34,593  233,698  199,105
Accountancy  -  41,234  41,234
Audit  4,903  30,975  26,072
Depreciation  6,173  119,347  113,174
Loss on Fixed Assets  7,867  4,684 (3,183)
Office Expenses  68,704  346,562  277,858
Total expenses  686,205  3,182,325  2,482,080
Revenue
Membership Subscription  682,178  2,768,676  2,086,498
Interest Received  29,928  166,392  136,464
Rental Income  -  39,580  39,580
Sundry Income  -  110,990  110,990
 712,106  3,085,638  2,373,532
Taxation  8,230  49,705  41,475
Net Surplus (Loss) 17,671 (146,392) (128,721)
Tagged: • • • •

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  • coventry

    I think they have left the meat hanging for too long – something stinks & looks pretty rotten.

  • Alloytoo

    I’m stunned by the misrepresentation. How is this any different from fraud?

    • BW_Lord

      Yeah, you can’t tell me that this wasn’t a deliberate case of “bullshit and see if it flies”.

  • Mark

    Actually running a calculator over these figures the position is worse as the “actual” expenses are $14k understated and therefore the difference in reported profit is $150k

    • owl

      yes – I noticed this as well – that was what I am looking at next – will keep you posted

      • Mark

        Hi Owl, the $14,040 difference appears to be the depreciation and loss of fixed assets combined.

        • owl

          Mark you are correct the depreciation and loss off on fixed assets is included twice – one as seperate lines and again in the overhead fiqure.

          The reported loss difference is as you have calculated $150k – I think the Owl would like to have you as my “fact checker” – send Whale Oil your email address and will forward it on

          The Owl always apologises if he makes a mistake – I had a cell formula wrong which in this case made the the understatement of their financial position worse.

          • Neil

            You’re so bloody modest Owl – “good on you mate!”

      • Gazzaw

        Once you have everything 100% squared off will you be releasing these figures to the MSM? I assume the The Truth will be giving it a very good airing.

        • owl

          I will be submitting a story – I dont have editorial rights and do this for free (therefore happy why I keep my identify anonymous). I have always said if you get paid then one should declare who they are.

          We wait for the MUNZ accounts too.

          • Gazzaw

            Great the sooner these discrepancies get fresh air the better. The public needs to see what’s been hidden for years. If links to labours war chests can be established and proven then better still.

  • Jman

    The Net Surplus(Loss) Understated by figure is incorrect. It should be 164063. They originally filed a Surplus of 17671 but they really had a 146392 loss, so your brackets are in the wrong position. Other than that, great work exposing this.

    • owl

      see my note to Mark below

  • blazer

    big discrepencies.This must be what corporates call ‘fudging the accounts’.Has to be done by the right people…shed a tear for Andersens.

  • blam

    Owl

    Have a look at the Notes to the Financial Statements under Reporting Entity, you’ll find your answer there, especially when one failed to pick up huge glaring error in the balance sheet. it would have been blindingly obvious before running off to the MSM and embarrassing yourself.

    • owl

      not sure why I am embarrasing myself. The Reporting entity you refered to was the updated version filed by the Meat Workers Union, their original returns filed did not mention branches or sub-branches.

      Remember these are not my numbers or audit comments – they are the Unions and the Auditors.

      However happy to clarify further on your reporting entity comment.

      What the huge glaring error on the balance sheet – I am intrigued

      • blam

        One is Consolidated, the other a Parent, the notes are clear on that. Your analysis is pointless, and that reasoning would have been quite clear by comparing comparatives. If the Balance Sheets dont match in the comparatives, then there is no point going further. As anyone knows, the Balance sheet is the first place to check the validity of the P & L.

        Everyone here is screaming fudged accounts, fraud and addition errors, but if one simply checked to see if these were single entities or consolidated ( which is mentioned in one of the sets of financials) then this whole hysterical thread wouldnt have eventuated.

        Best to say that the Union has filed two different sets of accounts, one a Parent and the other consolidated,

        • blam

          also another point, you have prepared a letter to the members about these accounts. the cover note of with the accounts were uplifted with, kinda makes it redundant

          • Callum

            This is where you are entirely wrong. They are not parent and group accounts as the branches are not separate entities. The second set of accounts prepared are the parent accounts and include all the parents activities. The first set of accounts were incomplete and in breach of the accounting standards, which is why they had to re-submit accounts that actually complied with the legal requirements. There are a few indications they still don’t comply as well with regards to one of the investments not being properly equity accounted under FRS-38.

          • blam

            Are you suggesting they are Associates under FRS 38 …think carefully on that one

          • Callum

            No, if you read it what I said was they may still be non compliant as one of the INVESTMENTS may be required to be accounted for under FRS 38. They hold 260,000 of the 700,000 shares in the Trade Union Centre Canterbury Ltd (37%). Without evidence to the contrary that would be considered significant influence, making it an associate and falling under FRS 38.

          • Callum

            Interestingly that investment happens to have what appears to be a related company of the union auditor filing their annual company returns. It isn’t really a good look to be handling administration duties for a company your audit client has a significant holding in. Not specifically forbidden but I wouldn’t be that comfortable about how it looks these day, not a hard job for the client to handle themselves which would be much tidier.
            Given the investment is audited, I would be curious to see who the auditor is. Another interesting little tid bit, the NZ Labour Party is also a shareholder.

          • owl

            Not a tid bit at all very important point that NZ Labour Party is a shareholder. This is very worthwhile looking at. Interest free loans to a building which in turns receives dividends which then goes to a political party. Donation disclosure issue? Keen to hear more cullum…keep up the research

          • owl

            Cullum yes same auditors..also very interesting Because in my research there is another union who has been receiving capitation fees manufacturing and construction union workers from two other unions. I have been trying to work out the link…however that is another project I am working on but they are shareholders as well. This shareholding list is very interesting. Keep up the good work…The Owl gives you an A+

          • owl

            The Registrar instructed the union to comply with the law. What is your point? The union failed to report millions of dollars in revenue and losses. Even the NBR supports this view and more importantly so does the Registrar.
            The Registrar by making the union to comply effectively and demonstratively supported the members rights. Imagine going to the bank and getting wrong numbers just like the investors in Ross Asset Management are finding out about misrepresented numbers!!
            Members have right and the Owl is very supportive of members!
            You should be directing your angst at the union management!

        • owl

          Out of interest Blam ..why are you defending the Union?

          • Random66

            It wouldn’t surprise me if Blam was somehow involved in preparing these financial accounts for the union.

          • blam

            Not defending the Union at all, just pointing out that you are comparing the Parent with the Group, I dont recall where I have defended the Union, but will point out where the obvious flaws in your discussion lays

          • Callum

            Go check the definitions of parent and group in the accounting standards. There is no group only parent as the branches are part of the one legal entity.

            What was being compared in the recently filed correct accounts to the previously filed incorrect accounts. If they were group accounts they would also need to disclose the parent numbers which they don’t.

        • owl

          Blam…your details and knowledge is interesting of the facts. I can comfortably assume you have a relationship in all these matters

          • blam

            Answer to that question is no, I’m more of a devils advocat

    • Bafacu

      Before you make a bigger fool of yourself by criticising him, Owl didn’t post a Balance Sheet – it was a P&L .

      • owl

        thank you Bafacu – balance Sheet anaylsis tomorrow

  • Hazards001

    Fucking accountants..instead of parent child and FRS 38′s…tell the truth…some bastard is stealing and he has an accountant helping him do it! What a suprise..I wonder why the world economy is in the shit? Maybe Stalin was right…line the lawyers bankers accountants and judges up….against a solid concrete wall!

    • Callum

      Poor accounting doesn’t automatically equal theft or fraud, I haven’t seen anthing yet that I would want someone locked up for. Deregistered as a union for incompetence maybe, but that is about the limit so far.

  • thor42

    Wow…… Good work, Owl!

    Thank goodness there is **someone** out there who is prepared to put in the hard work to expose this stuff.
    Dollars to a knob of goat poo that this is fraud.

    • Callum

      I wouldn’t bet on that. Poor accounting practice is a long way from fraud. I’ve seen both a number of times, lots of honest people who think they know far far more than they actually do.

      • GregM

        Absolutely agree Callum. After being self employed for a year, I am finding the accounts (Income tax, company tax, depreciation etc) a bit beyond me, and I need an accountant. But how do I know if they are any good?
        Also, my filing date is february, so I need to get onto it.

        • Callum

          My advice Greg, unless you have good rapport and an open relationship with your accountant you won’t get what you need. No amount of top level reputation or even indepth knowledge will ever replace the personal touch and understanding your business. That’s why I am an auditor, people aren’t supposed to like me. lol

          • GregM

            Thanks Callum, I have never had an accountant, I have always done it myself, but now that I am a company I really have to get it spot on.
            I may have to just stick a pin in the phone book and try my luck. Cheers, Greg.

          • Callum

            Personal references are the best, talk to fellow business people to see who they use and how happy they are.Your clients are your best referrer of new work. Bigger firms do give you the opportunity to shift your primary contact while staying with the same firm if the relationship doersn’t go the way you want. I will say start early in the alphabet but after Arthur Andersen.

          • GregM

            Awesome, Thanks Callum.

  • Time For Accountability

    Beck & Associates are chartered accountants which implies they are members of NZICA.

    If that is correct they will have been subject to Practice Review by NZICA who arrive every three years and check the firms files. There is concern amongst some accountants that this process is flawed largely because there are few people in the Institute with the knowledge to prepare accounts. Ask how many staff are chartered Accountants. You will be shocked.

    NZICA attempt to get around this by employing a team of independent contractors to conduct reviews. This is viewed by some as cushy retirement jobs for people that may be auditors but have little experience in preparing accounts.

    Ask yourself a simple question who many auditors of finance companies have been hauled over the coals?

    As an accountant i regard it as gross negligence whereby the same set of accounting standards can be produce such a different result

    I cannot ever recall two such vastly different sets of accounts for the same period having two different audit reports.

    The auditors were conflicted when the inadequacies in the first set of accounts were exposed and under the ethics were thereafter compromised.

    Questions need to be asked about the Auditors and NZICA’s practice review standards.

    NZICA has a director of Quality Assurance and I encourage readers to contact this person direct. Robert.manktelow@nzica.com.

    I suggest that the registrar of Societies has no alternative than to ask for a formal inquiry into the Auditors and NZICA’s practice review standards to establish if readers of the accounts can have any assurance as to Quality.

    It is issues such as this that destroy public confidence in Accountants and ultimitely in the capital markets.

    Don’t hold your breath for NZICA to be proactive.

    • owl

      Wow..I will definitely follow up…thank you

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