Why filing accounts are important – EPMU comes clean, but where did the $6.6M go?

A post by the Owl

Background – for all readers of the Owl know that I am 100% behind members of Unions and my bone of contention always started when Gary Parsloe and Helen Kelly asked me as a taxpayer and ratepayer to support them against the POAL.

I have written that “okay if you want my support I would find out a bit about you” I very innocently looked up MUNZ’s and NZCTU’s information on the incorporated societies website only to find it was either missing, incorrect and members where getting short-changed.

NZCTU has 30 plus affiliated unions and a number of them have just not complied with the law of the land. Once again I question the governance at the top of the NZCTU.

Now after a year the EPMU have ,under instructions from the Registrar, finally filed their full accounts from 2005 and as expected their previous “cut and paste” and “excel accounts” never showed the true story to the public.

Remember this was the same time that Andrew Little was their National Secretary, he remained the head of the union until 2011 as well as maintaining his role as Labour party president from 2009.

Observation from the Owl

One of the big debate from their “cut and paste” set of accounts was a loss on the balance sheet of $6M. We can now reveal why. Please remember a number of CA’s have also blogged on WOBH about their inability to make sense of the original accounts filed.

The NZEBA Limited issued shares of $6.6M to the EPMU then the EPMU wrote off the value of the shares.

Questions the Owl would be asking if I was a member.

  1. Had the NZEBA Limited accrued $6M of losses and then shares issued to cover the debt?
  2. Why issue 6M shares only to write off the value?
  3. How can a simple business of being a “bargaining agent” end up costing $6M?
  4. Why wasn’t the full set of accounts filed correctly with the Registrar from day one especially when the EMPU had full audited accounts in their offices?
  5. Who was running NZEBA Limited?
  6. What was the outcome of the 2005 tax audit?
  7. Why was $1.0M of software investment written off?

As always – all information is freely available in the public domain (in this case a few years late).

The Owl’s assistant also asks:

Why does a Union Subsidise side businesses whose results are hidden from members other than via the consolidated figures.

If I was a member I would want to know about each subsidiary especially ones where $6,000,000 goes. But in the EPMU caser there are four entities in the consolidated result with no separate accounting for each one.

The mixing of entity types does not work well.

In this case we have an incorporated society owning two companies and charitable trust and Journalists Prize fund (normal trust I think).

The point is that it a structure where money could be sucked out of an entity to associated parties without any accountability. This was the prime accounting failure in finance company collapses and how can anyone know it is happening here.

Update on Union Financial Returns – Observation by the Owl

Well MUNZ seem to be still on summer holiday as they have only filed their revised accounts up to 2009. I could appreciate a small delay on not filing the 2010 and 2011 updated accounts but he only problem is that they have missed the deadline on filing their 2012 accounts.

The Incorporated Societies Registrar has received the full financial accounts from EPMU but have yet to upload on the website.  Read more »

Posties and the EPMU

Posties could be saved if the EPMU spends less at Palmers Garden World.

The incoherence award for confusing media releases goes to the EPMU after NZ Post faced up to reality and Minister Amy Adams grew a pair after vacillating for far too long on a modern postal service.  Not that this has pleased the comrades at the EPMU.

In a superbly worded media release it managed to argue for and against itself. Galileo must have been wrong given the EPMU spinning these pearls of wisdom:

“Moving to a three day mail delivery service is not sustainable or justified by current mail volumes, says the union for postal workers, the EPMU.”

Yet, forgetting what they wrote only two sentences beforehand, EPMU postal industry organiser George Collins adds this wonderful insight:  Read more »

EPMU, rules don’t apply to us , some animals are more equal than others

We all know that the the EPMU can’t follow the rules of the Societies Registrar, now we have evidence that they can’t follow the road rules:

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Read more »


EPMU and their financials – Observation by the Owl

It looks like we are not the only people who have been analyzing the EPMU accounts. We received a detailed spreadsheet from a former Chartered Accountant who has been following the stories on here and decided to do his own analysis since 2003.

The information he provided was unsolicited and anyone who follows the Owl’s writing knows I only use information freely available in the public domain. This is the first time the Owl has used someone else’s research so I spent time verifying their information.

Because it came from a former Chartered Accountant you can appreciate the detail provided is quite magnificent and a very interesting read. He made a number of notations which he has followed up with a letter to the lawyers at the Companies Office which we have seen.

Owl’s Observation

If you make a submission to Parliament you need to be very accurate with your information. A submission provided to Parliament by the EPMU said they represent nearly 50,000 workers (Electoral Finance Bill submission).

Their website says they represent 43,000 workers.

Their Department of Labour return says they have 37,000 members.

As they wrote to Parliament (the highest law in the land) and said they had 50,000 members and their membership fee is $7.30 per week this totals $18,980,000.00 in annual subscriptions but only $11,000,000.00 has been filed in their financial returns.

Which number is correct – 50,000 or 43,000 or 37,000?

If 37,000 then the parliamentary submission and website is incorrect.

If 43,000 then the parliamentary submission and Department of Labour file and financials are incorrect.

If 50,000 then website, DOL file and the revenue in financials are incorrect.

More to come on this analysis.

EPMU now in the gun with the Registrar of Incorporated Societies

Companies Office Lawyers have asked EPMU to forward their full audited accounts

The EPMU have been instructed by the Registrar of Incorporated Societies  lawyers to forward to them their full audited accounts so they can posted on the Incorporated Societies website for public scrutiny.

The current accounts filed on the Incorporated Societies Office carries a recognised New Zealand Auditors letterhead but no notes or Auditor’s statement.

This has been happening since 2005. They have failed to comply with the law for more than 8 years, almost all of them under the leadership of Andrew Little.

The EPMU have been asked to file immediately to the Societies Office and not to upload the accounts themselves onto the website.  Read more »

Is there a Governance Crisis at the NZCTU?

Is there a Governance Crisis at the NZCTU? – An Observation by The Owl

Over the last few months 2 of the 6 (technically) affiliated unions (NZ Meat Workers Union and Maritime Union of NZ) who get to vote on David Shearer’s future have been put under the spotlight by the Registrar of the Incorporated Societies. It has been proven they have both failed to file complete returns with the Registrar.

The NBR also questioned a 3rd union, the EPMU, on their balance sheet regarding a Pike River Trust. The EPMU have been reporting losses and the EPMU Education and Training Trust fund for members remains solvent only because the EPMU does not demand the $6M loan back as qualified by their auditors. (The Trust assets are approximately $3M.)

A number of so called affiliate unions to the NZCTU have been reporting losses, failing to declare income for GST purposes and generally been late with their financial returns. But to be fair some unions are good at compliance.

The ultimate responsibility of the NZCTU is to their members. Are there governance policies in place at the NZCTU head office to manage its individual unions when they fall out of line?

The Owl asks, is there a governance crisis? Here is a great example of good governance by a governing body.

When the Otago Rugby Union got into trouble – the NZ Rugby Union went down there, told them to sort themselves out and if they didn’t the NZRFU would liquidate them. The Board was changed and a number of people stood down. This is good governance from the top and Otago flourished on the field in 2012. The word on the street is it is a pretty happy camp now – a good dose of “tough love”

Owl’s Observation

The Owl believes the Labour Party Executive should demand that the NZCTU develop a good governance model to manage their affiliates if they want to get 20% of the voting rights.

The Labour Party Executive can exercise their governance control and meet with the NZCTU just like the NZ Rugby Union did with the Otago Rugby Union.

Current day unions only represent between 6-9% of the workers in private industry. Does this means the Labour Party is being distracted by pleasing a few when actually they are missing out on potentially serving the 94% of working voters?

The Owl is looking forward to analysing the results of the Labour Party Conference

Andrew Little and EPMU seriously criticised by the Left

From the The Owl

We all wish and hope that bodies can be recovered or at least closure is gained for the families of the Pike River mine.

A number of editorials and opinion writers for MSM have suggested as soon as the report into the Pike River tragedy was released the “blame game” would begin.

Having read as many reports as possible it is the left wing blogger Steve Cowan with his article on “Against the Current” which is absolutely superb.

The parties involved have all put their hands up and in lay men’s terms have said “we have had a part to play in the disaster”. Prime Minister John Key, Minister of Labour Kate Wilkinson, David Shearer on behalf of previous Labour Governments and the list goes on.

However as Steve Cowan writes, the EPMU had a golden opportunity under Andrew Little’s leadership to raise concerns about the mine and health and safety within the mining industry. If his analysis is right and it is a very well researched piece he squarely puts part of the blame on “modern unionism”.

The focus must remain on the findings on the report, implementation of measures suggested without political tinkering and closure for the Pike River families. Accordingly Steve Cowan suggests that the EPMU, Andrew Little and Damian O’Connor should also look very seriously at their roles.

Observation by the Owl

For the followers of the Owl my mandate is to always apologise if what I have written is wrong.

Sometimes that takes guts and Steve Cowan piece has really got me thinking.

The words “modern unionism” means what? I don’t know what that means but what I do know is that people within the union have used their unions to build profiles and enter such domains as parliament.

The 20% voting shifty pulled by the Unions for the future appointment of any Labour Leader shows again how agendas can destroy institutions.

New Zealand needs strong governments and equally needs strong opposition – we can all handle a good debate but leadership on either side of the house also needs to exercise “humility”. Empathy for others.

As I heard recently on a radio show when the talk back hosts was criticising the 7% unemployment rate, the astute co-host said – that’s great 93% are employed in New Zealand.

Andrew Little comment in parliament this week when he said that “there was no business leadership in this country” reminded me how much our politicians are out of touch with reality.

Every morning, hundreds of thousands of New Zealanders wake up each day and go open their workshops, businesses and work on innovations and design to satisfy their needs of their workers, clients and families – not to satisfy unions or politicians.

Steve Cowan, the unions didn’t kill the workers, nor did the government – a whole lot of personal and ideological agendas did over a very long time.

A Typical Unemployed Battler

What is it about the Herald’s Simon Collins and his efforts to tell the heart-rending “human” stories behind the Herald’s job crisis, starving beneficiaries, children in poverty etc etc etc?

Today, he finds us a battling Mum who tells a tale of redundancy woe, factory workers laid off, a futile hunt for a job and now the bleak prospect of maybe having to go to Australia to get work.

After ploughing through paragraphs of this sad tale of an ordinary worker beset by troubles, we hit the last couple of paragraphs.

And lo and behold, the working Mum Simon discovered by diligent research is……a Member of the Labour Party Waitakere Electorate Committee, and a member of the Executive Committee of the EPMU.

She counts herself lucky to have lots of contacts. She is on the Labour Party’s Waitakere electorate committee and is on the national executive of the Engineering, Printing and Manufacturing Union.

Spare me.

Since she is on the national executive of the EPMU perhaps she might like to explain their massive losses over recent years?

A message from Bill, Ctd

Bill is coordinating the campaign well, but is getting testy as key details leak out.