REA Audit at Co-op

[Dbearman]

The Co-op I work at has not made TIER for 3 years and now we were told that a REA auditor will be spending 3 weeks with us . Does this mean something is up or is this common ? Management has little to say about it other than to tell us its happening . Does anybody know how this usually plays out ? Thanks , Bear

[Koga]

Knowing the Feds, since its broke or aint workin right ,lets give everyone there a raise and throw more money at it ! Your gonna get a raise dude:D

Koga

[thrasher]

The main things that they usually look at is construction projects. Are they built per the plans? Are they needed per the Construction Work Plan? If contractors did any work was it a fair bid process or was it "good old boy network"? Finally are your rates set properly for your expenses. I have seen some audits where RUS said everything is fine you just had a run of bad luck (the coop was hit with two ice storms in three years, that wiped out thier cash and line of credit). On the other hand I know of a Coop where they found "good old boy" under the table bidding goin on. When the dust finally settled the Coop had a new CEO, a new Operations Manager, and 2 contractors were barred from EVERY bidding a RUS job again. In fact one of the contractors went to jail for embezzlement and tax fraud. In another case RUS ordered the Coop to file for a rate increase and then the RUS auditors presented the rate case to the state PUC. (They got the increase). If you handle paperwork make sure you do everything complete and by the book. If you don't handle paperwork just keep you head down and do your job. Good luck.