First Nation mired in $10-million debt Jason Warick, The - TopicsExpress


First Nation mired in $10-million debt Jason Warick, The StarPhoenix Published: Saturday, September 24, 2011 Wild overspending, few financial controls and a controversial loan from a Saskatoon home building company are just a few of the reasons the Beardys and Okemasis First Nation near Duck Lake finds itself buried under a debt of nearly $10 million. The band has not paid its bills in months and risks getting its power and other services cut off, officials say. Staff payroll funds are being diverted to fund operations and make monthly interest payments. These and other details are contained in documents released recently by the new chief and council in this Cree community of 1,600. Email to a friend Email to a friend Printer friendly Printer friendly Font: AddThis Social Bookmark Button (Beardys) is in serious financial difficulty with virtually no payments being made to suppliers, the Aug. 10 letter from the Saskatoon branch of accounting firm MNP said. The Nation continues to overspend without implementing the necessary changes to drastically cut spending in all areas. If the situation does not improve soon, the federal government will move in and seize control of band operations, a last resort known as third-party management. Banks have stopped lending to the band and the federal government says it will not offer any bailout. New Chief Raymonda Gardipy said she has started to make cuts and is promising many more. She hosted a meeting last week for band members to give their input and a plan is being drawn up, she said. The community has been very supportive, but were in too deep. This is going to take time, Gardipy said in a telephone interview Thursday. . . . Gardipy defeated the incumbent chief of five years, Rick Gamble, in the bands March 18 election. I knew we were in deficit, but I didnt realize it was this bad, she said. I felt very overwhelmed. MNPs audit and accompanying management letter paint a bleak picture of recent events at Beardys. The bands social assistance programs, for example, have incurred a $987,000 deficit since 2009, the letter said. This is due to a combination of factors, including improperly recording invoices and not filing any paperwork on large expenditures. More than $230,000 in claims to the federal government were rejected in the past year alone for various reasons, it said. The social assistance department continues to be a significant cash drain on Beardys, the letter said. Many of the problems below have been communicated in previous years, yet no corrective action has been taken. Basic bookkeeping and accounting procedures in many areas have been lax or non-existent, it says. One branch of band operations often paid or lent money to another without any reporting, resulting in a shortfall of $353,150. The band has multiple unnecessary bank accounts, which are difficult to co-ordinate, MNP said. This has resulted in needless large interest payments on overdrafted accounts at the same time other accounts contain significant balances. There are also large discrepancies among band invoice records and the amount actually owed to suppliers. A propane company is owed more than $95,000, even though the band ledger reflected only $40,000 owing, it said. 123
Posted on: Sat, 22 Mar 2014 13:59:48 +0000

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