As you know, the former CFO of DIxon, Illinois, Rita Crundwell, has been accused of misappropriating $30,236,503 and 51¢ from Ronald Reagan's boyhood home. It's a haul of Sue Sachdeva proportions, although it appears that obsessive shopping wasn't so much the motive as it was a My Little Pony fascination for a grown woman. ANYWAY, there seems to be a lot of questions about how such a fraud of this scope could go on undetected for so long, and could only be discovered when Ms. Crundwell took 12 weeks of unpaid vacation. A lot of people think both CliftonLarsonAllen, who compiled the city's financial statements, and Sam S. Card, CPA, the auditor of the financial statements bear some responsibility, but there's also the Illinois Comptroller's Office who is supposed to review the audited financial statements.
It's interesting to note that CLA prepared both the compilation and the audit, prior to recommending Mr. Card to be the auditor. That occurred in 2006, around the time that the alleged fraud began. But before you get your knickers in a twist, someone would like to give you a refresher:
That doesn’t necessarily mean the auditor did anything wrong, said Mark Peecher, an accounting professor at the University of Illinois. “One of the things you need to keep in mind, there’s this thing called the expectation gap,” Peecher said. “The public thinks the audit does more than it does.” Even so, Peecher said he wouldn’t be shocked to find out the audit wasn’t up to par. “The probability that this happens and the person doesn’t get caught increases if the audit was of insufficient quality,” he said. “But even if the audit were up to standard, this could still happen and that would not be shocking.”
