Subject: A Response to SVC Statement (fwd)

From: Hongguang Zhou <[email-masked]>
Date: Wed, 20 Jul 1994 11:11:38 -0400 (EDT)

A Response to SVC Statement

				Bai Yan
	Member of IFCSS Council Financial Inspection Teammember

Dear Mr. Luo Lishi:

	Having just read SVC Statement on the appeals, I feel amazed
with the scope of subject matters it tries to deal with. Apparently, it
is no longer a judicial opinion on the cases brought to you; rather it
is a self-initiated evaluation of the roles played respectively by 
Inspection Team (IT), Finance Committee, Council, HQ, and many Council
members in the financial inspection. In this sense, I'd like to make 
some arguments to this document evidently prepared by you.

	Fair presentation in the accounting records is vital to the 
interests of the group members and those who donate. One of the treasurer's
duties in the case of IFCSS is to enter transactions and provide financial 
information fairly so that a true reflection is made in accordance with the 
GAAP (generally accepted accounting principles). What IT did in the past
months was exactly directed toward this objective. Irregularities in the
IFCSS's financial books were caused by the previous treasurer's unqualified
presentation, which seriously damaged the credibility and reputation of 
IFCSS.  This matter of such importance, however, is not even mentioned in
your quite comprehensive statement. In fact, IT had urged the treasurer many
times to make necessary corrections and adjustments so as to achieve the
balanced accounts and attract more contributions. All to no avail.

	Professional reports were not attempted until the previous
treasurer resigned and Jeff Lin, a CPA, stepped in. Like the treasurer of
IFCSS, none of the IT members has professional title. But IT has sufficient
working knowledge in the profession of accounting to issue its opinion
and is responsible for its spirit and letter. IT's comments and suggestions
were and are still valid. Whether they are negative or not is not the issue
in recognizing problems. IT's mission came to the end, at least in theory,
when Jeff Lin took over early this year. A comparison at glance would reveal
startling differences between the financial statements compiled by Jeff 
and the treasurer both in format and substance. I will make available the 
copies of the two statements to the public scrutiny when convenient.

	Jeff's participation undoubtedly pushed IFCSS toward standardization.
Nevertheless, his compilation of Income Statement and Balance Sheet has been
abused to dissolve the responsibilities to be borne by the treasurer. It must 
be made clear that Jeff's financial statements are at most a substitution to
rather than continuation from the treasurer's. Therefore, Jeff Lin's 
independent work is not equal to the assurance of no problem to the 
treasurer's performance. Nor should it be stretched to imply any assurance
to IFCSS's financial management. Remember what he says everytime he presents 
his reports, "I have not audited or reviewed the accompanying financial 
statements and, accordingly, do not express an opinion or any other form of
assurance on them." To attest assurance to any compilation, an auditor must 
be hired for examination. 

	My name and my work are mentioned in an unfavorable manner so 
frequently in the statement and so constantly over the entire course of 
action. I begin to feel personal stake in this matter and have to safeguard
my interest in any way I can. A few comments on SVC's capacity is as follows.
First, SVC is judicial and serves as a neutral arbitrator who stands above 
the dispute as a disinterested party to ensure that each side battles within 
the established rules. SVC is not prosecutor in such a way as being a part 
of the executive branch of IFCSS. Nor can it be prosecutor and judge at the 
same time. In the case of appeals, SVC's injunction should be limited to
the defendant--a person against whom an appeal is brought. A judgment beyond 
that such as the one on the IT's opinion and conduct is totally outside 
your jurisdiction. Second, SVC is designed to supervise IFCSS officials 
not volunteers. Subjecting volunteers to your judicial review is sheerly a 
ridicule and politically harmful to volunteerism.

	Recall what IT experienced in this adversary, certainly IT should 
have reacted to the pressure more out of patience than out of frustration;
IT should have been more prudent in wording and releasing public information;
and IT should have anticipated the unintended consequences. Besides, there
will be no regret, no apology, if that is expected. As for myself, I am
proud of and confident with what I did and wrote as a member of IT. You can 
challenge, but you will not gain.

	Finally, though SVC tried to be even handed in the statement, it 
must be realized that various disputes arise greatly from poor communication
and misunderstanding. SVC should learn how to mediate and reconcile them, 
rather than make "zero sum" decision, favoring one party at the expense of 
the other. Those involved in the disputes don't represent good or evil; they
represent different approaches and outlooks, and they all care about IFCSS.
If SVC is unable to unify, the least to do is to divide.

From: Bai Yan