News | McGill withholds $90,000 from AUS

Missing audits jeopardize critical student services

The McGill administration is withholding $90,000 in student fees from the Arts Undergraduate Society (AUS) until the Society can produce documentation verifying the state of their finances.

The AUS executive broke the news to Arts students in an open letter Monday night, which is now posted on their website.

The letter states that Morton Mendelson, deputy provost (Student Life and Learning), “has now decided to withhold your student fees until all outstanding audit reports are received.”
In the letter, the AUS executive wrote that Mendelson’s actions have put the AUS “in jeopardy,” and that “his actions have put our student services at risk.”

The $90,000 is intended for AUS’s general operating budget, including the Arts Student Employment Fund. Given that the AUS had to pay off $18,000 in unpaid taxes earlier this year and ran a $30,000 deficit for AUS Frosh, many of these services could suffer as a result of withheld student fees. AUS President Dave Marshall said the executive had taken emergency measures to ensure the continued running of staple events like the weekly Bar des Arts.

Marshall said the executive had already “planned this year out to a tee because there is no extra cash.”

According to Mendelson, the AUS first committed to getting the administration financial statements by March 19, 2010, but, as of August 2010, the two missing statements – from fiscal years 2009 and 2010 – still hadn’t been submitted. On October 5, 2010 Mendelson said the current AUS executive committed to submitting 2009 financial statements by October 15 and 2010 statements by October 30.

“Based on that commitment we released the cheque,” said Mendelson. “That’s the second cheque that we have released to the AUS on the commitment that we would get their financial statements, and then the financial statements didn’t come.”

Referencing an article published in the McGill Tribune, Marshall said he was insulted by a quote from Mendelson that read: “Once bitten, twice shy.” Marshall said he felt the quotes insinuated that Mendelson felt personally affected by events.

“I don’t think there was any malice ever intended by any executive in not producing these audits, and certainly [Mendelson’s] not personally affected by any of this,” said Marshall. “Students are at the point where they will be personally affected by these services.”

Upon entering office this year, AUS executives learned that the Society had not submitted audited financial statements to McGill since the end of the 2008 fiscal year. Despite the missing audits, Mendelson’s office had continued to release fees to the AUS on the understanding that the Society would submit financial statements soon after.

Marshall also pointed out the difficulties student associations face in compiling annual financial statements, given the annual turnover of executives.

“The problem is if the auditor is missing any financial information from that year, that executive has already disappeared, and it’s up to the new executive to try and figure out what pieces are missing,” said Marshall.
Marshall described an instance from the 2008 Arts Frosh where AUS could not access their PayPal account for the event.

“The password for PayPal disappeared with the previous VP Finance, who ran off, was out of the country and no one was able to get in contact with him, and, by the time they were, he had forgotten the password to PayPal,” said Marshall. “It’s an endemic part of the structure of how student organizations run.”

Marshall said it took AUS a year and a half to get the password for the PayPal account.

There was also confusion between Marshall and Mendelson concerning communication.

“We keep on writing to the president and say, ‘Look, we need to know certain information, can you please give us the information?’ We don’t hear back from him,” said Mendelson.
Marshall, however, said he has had difficulty scheduling a meeting with Mendelson, despite repeated attempts over the past few weeks.

“I’m still waiting for…a meeting with [Mendelson] that has been requested for the last two weeks,” said Marshall. “We’re now doing more communicating through the press than an actual sitdown meeting.”
Mendelson said the administration had decided to finally withhold the fees for the benefit of students.

“The reason why the University does this is that…for us to fill our responsibility to students from whom we are collecting money we need to know that the money is being used appropriately,” said Mendelson. “That is to protects students from groups or executives who might be irresponsible with their money.”

Marshall said the AUS hopes to provide Mendelson’s office with Notice of Reader statements, informal audits that give an idea of where the Society’s past finances have gone, at which point he expects the funds will be released.


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