The Cattlemen’s Beef Board on Monday, July 26, 2010 received the final report of a routine compliance review.
The National Cattlemen’s Beef Association came out with the following response to the CBB review Tuesday:
“On Monday evening, July 26, we received the independent accountant’s final report. We are committed to achieving accuracy in this report. Responsible use of the producer dollars and ensuring the financial firewall are critical. Where mistakes were made, we will correct them.
“A compliance review has been conducted every year of NCBA’s 14-year existence. There has been a transparent as well as full reconciliation of expenses when warranted. Every time there is a review, there are lessons, and we consider those an opportunity to fine-tune our processes going forward.
“We agree with CBB’s accounting firm, Clifton Gunderson LLP, and with CBB that written and specific guidelines are needed for all checkoff contractors. The accountant’s inability to determine compliance on select items does not mean non-compliance. Rather, it is an indication that written guidelines are needed to achieve compliance.
“NCBA understands the importance of compliance with the financial firewall and accepts this responsibility without question. It’s for this reason we keep separate bank accounts and our accounting and time keeping procedures are in accordance with and even exceed most industries’ standards. We have more than 8,000 different coding options for accurately assigning time and expenses. We strive for accuracy and will continue to seek clarity on guidelines to ensure compliance.
“When the National Cattlemen’s Association merged with the National Live Stock and Meat Board, NCBA became more than a policy organization. NCBA became the home for the Federation of State Beef Councils, and as such, the No. 1 champion for the beef checkoff. Our employees log more than 200,000 hours annually building and protecting beef demand. Every hour is focused on delivering results that matter with a strong focus on being accountable to producers.
“Our commitment is to address the compliance review through a very factual and transparent process with our Federation partners, CBB and the U.S. Department of Agriculture, which share accountability to producers who pay the checkoff. A complete response to the accountant’s report will be addressed with CBB, participants from state beef councils and state cattlemen associations and NCBA directors at this week’s Cattle Industry Summer Conference.”
Here is some background to the review process, courtesy of the CBB:
All checkoff contractors and subcontractors are subject to compliance reviews and audits.It is the responsibility of checkoff contractors to assure that checkoff funds are being used appropriately, and it is CBB’s responsibility to monitor checkoff contractors. To this end, CBB has the legal responsibility to perform reviews of its contractors periodically, and to oversee and enforce the rules regarding checkoff expenditures.
In February 2010, the Cattlemen’s Beef Board (CBB) began the process of conducting a routine compliance review of the National Cattlemen’s Beef Association (NCBA) by engaging an independent CPA firm to perform agreed-upon procedures at NCBA. This firm reviewed NCBA compliance with its agreements to conduct checkoff-funded programs in the areas of beef promotion, research, consumer information and industry information. The compliance review also included compliance of checkoff expenditures of the Federation of State Beef Councils Division of NCBA (Federation). This compliance review included fiscal years 2008 and 2009 as well as the five months ended February 28, 2010. The agreed-upon procedures were performed to test: NCBA’s allocation of overhead costs; employee time reporting as a basis for the allocation of salaries and benefits to the checkoff; travel expenses; Federation costs; and subcontractor selection procedures.
In addition to Beef Board members and qualified state beef councils, this independent report has been forwarded to USDA-Agricultural Marketing Service, the oversight agency for the beef checkoff, for review and input.
Source: CBB & NCBA
Posted by Haylie Shipp