In 1992 there were concerns about fraud in the AWU!  Who would have thought?

This extract from a July 1992 letter from Bob Kernohan to the National Secretary of the AWU sets out the Rules of the Union about audit.  The Mr Smith is the first of the two Bob Smiths who held the position of Victorian Branch Secretary.

These media reports set the tone of the time:

And Bob sent flyers like this one to members.

I've looked at a number of records of union meetings at the time, and these extracts of minutes of meetings seem representative of the views of many members who called for external auditors.

As you read in our previous post, the request for an Audit in the terms that Bob set out was refused by the National Executive.

That left Bruce Wilson free to find the best external reviewers he could get.   No doubt Bruce was driven by a desire to deliver the most rigourous assessment of the Victoria Branch's finances that he could.   I don't know what process Bruce used to select the successful Auditors and Management Consultants - but the lucky company was none other than Hewitt and Co, the AWU's Western Australian accountants.

In this letter, Hewitt and Co avoids the use of the capitalised A Audit word.  But they do describe themselves and their work on the Amazing Mr Wilson's finances thus:

As Auditors and Management Consultants to many unions over many years we believe this is the most successful financial turnaround we have ever been involved with.

They refer to their independent review and report on the Victoria Branch, which amazingly was similar to the independent review and report they'd conducted on that paragon of financial rectitude, the quintessence of prudential exactitude, Bruce Wilson's WA branch of the AWU (not including slush funds).

Hewitt and Company say that they'd independently examined the financial controls in place in Victoria in the same way they'd examined the controls in place in WA.   The results at the WA branch were very successful and Victoria was heading in the same direction! 

Those of you whose professional credential involve a bit of exposure to audit et al may wish to get a stiff drink before reading on.

The reaction soon.