City Treasurer Appears to Lack Understanding of Generally Accepted Accounting Principles

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The weekly city council meeting got underway on schedule and one of the first persons to speak, on what should have been about any item on the agenda, and was the city treasurer who was allowed to remotely address the meeting. Among other false accusations, Ms. Brown stated that the city is swimming in red ink, referring to the city’s fiscal health, decried the city’s decision to write off uncollectable accounts receivables, and hurled scurrilous remarks against the mayor and others. Mayor Butts immediately asked a city financial staffer to address her false financial assertions, which seemed to indicate that either the treasurer does not understand generally accepted accounting principles or is intentionally interested in misleading the public about the city’s fiscal health.

Generally accepted accounting principles (GAAP) refer to a common set of accounting principles, standards, and procedures issued by the Financial Accounting Standards Board (FASB). GAAP aims to improve the clarity, consistency, and comparability of the communication of financial information. There are three fundamental rules associated with GAAP: debit the receiver and credit the giver debit what comes in and credit what goes out, and debit expenses and losses, credit income and gains.

The financial staffer rebutted the treasurers remarks indicating that writing off uncollectible accounts receivables is reasonable after all collection efforts have been exhausted; that the city has $64 million in reserves; and the City of Inglewood has a AA bond rating. 

The council authorized writing-off accounts receivable items which could not be collected after thorough collection attempts and procedures, in the amount of $1,189,901.

The council authorized the payment to Ocean Blue Environmental Services, Inc. for emergency services rendered to clean-up areas at Edward Vincent Park.

The council accepted the La Cienega Inglewood Art Fence donation constructed along the east sidewalk area of La Cienega Boulevard between Manchester Boulevard and Florence Avenue from WOW Media, Inc. The bold sign welcomes drivers to the City of Inglewood.

The council approved and awarded a Staff report recommending award of contract and approval of an agreement for the construction of the Inglewood Intelligent Traffic Systems (ITS) Gap Closure Improvement Project: Construction per Bid No. CB-20-06.

The council approved an agreement with the Los Angeles County Flood Control District to receive annual Safe Clean Water Program tax revenues allocated to the City of Inglewood.

The council set a public hearing to consider approval of a Disposition and Development Agreement between Murphy’s Bowl LLC and the City of Inglewood regarding development of the Inglewood Basketball and Entertainment Center (IBEC) for September 8, 2020.

During the council member comments, Member Dotson urged the public to remember how far the city has come in terms of its fiscal health. He also announced his document shredding event on September 12.

Member Padilla noted the phrase, ‘no good deed goes unpunished,’ suggesting that while the vast majority of Inglewood residents support the council’s actions and decisions, there is a small percentage of those who are not supportive. He announced that the treasurer appears to be unfamiliar with GAAP and noted that the weekly meetings are for council members. He also felt compelled to speak out against the treasurer for continuing to express factual misstatements.

Member Franklin said the treasurer’s ‘red-ink’ assertion was completely false reminding everyone that the annual external audit attests to the city’s fiscal health. He also provided an historical review of the treasurer’s lack of a speaking role in regular city council meetings.

Member Morales reiterated his council colleagues’ comments about the ill-informed city treasurer and stated that personal attacks have no place in city council meetings.

Mayor Butts said the treasurer has been misleading the public for nearly five months and suggested that Treasurer Brown’s angst may stem from the fact that she was denied lifetime medical, consistent with existing laws. He further stated that it is unfortunate that our treasurer does not understand write-offs and the significance of bond ratings and chooses to lie about Inglewood’s financial health in a public forum.

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