Merry Christmas to Peter Wilson. When it was suggested that Peter Wilson should be independent of the old board so that we can have a fresh start Peter responded with "That's your issue". Summary of the meeting here: viewtopic.php?f=23&t=594
A good summary of where we are up to by Joe Aston of the AFR, linked to from here: viewtopic.php?f=5&p=4137#p4137
If you are new to this website read the story so far: viewtopic.php?t=321#p1793
Check out some of the AFR articles, too many to list and check out some of the ABC reports: ... 215-h055ej ... 211-h02x1d ... s,/8626662
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Brett's Weekly Update 5th July 2017

A weekly round up of the issues and progress
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Brett Stevenson
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Brett's Weekly Update 5th July 2017

Post by Brett Stevenson » Thu Jul 06, 2017 4:32 am

Hi all,

My apologies for the delay in responding to recent events. I am currently in Canada for a family wedding and shall be returning 10th July.

1. Fighting Fund is currently $32,375.Thanks to everyone who has contributed. It shall be used wisely and frugally. We may not have the big dollars on our side that the current CPA Australia leadership have but we do have right on our side. All the money in the world cannot buy what we have. But having said that we need to proceed to make sure there is resolution and some sense of justice.

2. Strategy from here - I shall endeavour to keep everyone as up to date with events as they occur insofar as our efforts go. I cannot broadcast before hand all planned meetings for obvious reasons but after significant meetings early next week I should be able to fill you in with more detail.

3. Let me up front and say I have major reservations about the so-called independent review currently underway. It is certainly better than nothing but we certainly want better than that. These are my reservations, and I’m sure many of you could add to the list

a. the current board is overseeing this process. There is no way that is acceptable.
I do not trust any of them as they are the remaining rump of loyalists who were instrumental in getting us into this position in the first place. Especially G Wade and R Petty who are now in the 12th years as directors (yes, all legal as per the constitution although not as per their explanatory memorandum and memos to members “no director will serve greater than 11 years”). M Dolin, S Portelli have served long enough on the board to know the ways things have operated, and they have been just as instrumental in these matters remaining hidden as anyone. Ditto of Jim Dickson. How is it possible that the person who introduced the financial report at the AGM in Singapore knowing what we now know about remuneration and CPAA Advice can now be the Interim Chairman defies all common sense to me. I’m sorry but this current board having any part in this process is objectionable to me.

b. Presumably the preliminary report is to be delivered 15th Sept to the current board. That is also unacceptable. The report needs to go directly to the members and not have any censorious role of the current board. They have lost credibility with me. If the board are the recipients of the draft report, and not the members and/or ASIC then it will be a failed review.
It ends with ‘a report’ (presumably final after the board have censored) being given to members.
No date set, one only assumes this will be before the 2018 AGM.
I’ll be upfront and honest with you, if there are no definite positive moves and answers well before the end of this calendar year I think the 2018 AGM will be too late for many members.
I suggest they should be planning for an EGM this year to make the necessary constitutional changes.

c. In relation to the independent panel I have major questions. Why was the fact that Maryjane Crabtree being a partner of the legal firm Allens not mentioned in her profile. Can we assume that Allens have not provided legal advice to CPA Australia because if they have then she needs to recuse herself immediately. Mr McPhee can surely clarify that one quickly.
In relation to the panel it’s hard to argue with the ‘eminence’ factor but that does not mean a great deal to me with two of them being FCPA’s, and I haven't heard a peep out of them prior to this on any of the matters raised.
No word on how much they are being paid but it is a darn lot more than any of the members who have worked tirelessly and voluntarily to expose these matters over the last five months especially. One of the big problems with all these matters is that on many of the issues CPA Australia is probably legally compliant, and I’m sure much legal expertise and eminence was utilized to ensure that was the case. It doesn’t impress me, and in many ways we need a different mindset to deal with the real issues at CPA Australia.

I’m not naive to think that we don't need to act within the legal framework but if all we have left is a legalistic compliance mentality then we are all the poorer for it. Just look at the audit reports for the annual report and the two s202B statements. From none other than one of the big guns in accounting in Australia, Deloittes, and I’m sure all legally compliant, but really it is a pathetic example of what an auditor should be doing. (“We let CPA prepare the statement and then we audit it regardless of whether it is misleading or not a complete picture” - read it. I’m sure they have had legal opinion to say it is alright but really is that the best the accounting profession can offer?).

So Messrs McPhee, Crabtree, McCluskey and Baxt I don't wish to cast aspersions on your eminent careers and credentials but I am echoing the comments of many members in saying that we expect better leadership than we have currently seen, and if this is just an income earning opportunity for yourselves with no passion to deal with the heart of the issues then you are wasting our time.
Don’t take that as being rude. I’m just being upfront with you.
We have worked on the ‘smell of an oily rag’ and exposed things that many people in eminent and better positions than we have just ignored and in many cases been silently complicit.
You have been employed to do this review by a board who we do not trust, with a terms of reference which has significant weaknesses in it.
We do not know you.
We (or me anyway) is not overly impressed with all this so-called eminence and expertise.
We have had to ‘fight’ hard to expose what we have to date because it is the right thing to do. Many of the issues we have exposed have shown a leadership which has shown a complete disregard for responsible and prudent financial management, and have been unwilling to be up-front and honest with us.
Many of those actively involved in this are still on the board.
So, forgive me for my less than enthusiastic welcome to you as you do your review, but hopefully you will understand why that is so.

d. Not too sure what the consultative group of members means but if, as it says, it comprises the Divisional Presidents, then you can have them. The division representatives, along with all the committee members, were the ones who should have stood up much earlier and were in much better positions to most of the membership to know what was going on. Yet, apart from a couple of exceptions, they remained silent and complicit. Oh, I’m sure that will win me no friends but quite frankly I couldn't give a toss.
What has been going on at CPA Australia for the last 7 to 8 years is nothing short of a disgrace.

e. the terms of reference are pretty loaded and/or vague - for example ‘consistency with Board approved strategy’ is just shorthand for saying Malley did what the board told him and therefore no culpability, and the board being a group of individuals can take the hit without any culpability. It was an unnecessary addition to the first four words and was only added to provide an ‘out’.

4. ASIC need to become actively involved.
I have little trust in our current constitution (quite apart from our board rump) to get us out of this mess, and why I think ASIC need to become involved. If this was ‘emergency’ enough for the current board rump to install a new director to maintain a quorum, then I think it is ‘emergency’ enough for ASIC to become involved.
To think that the current the current processes for appointing a CEO and new board are just progressing under the current board and representative council is completely unacceptable.
How can we possibly accept that the current governance system can be used to instal new board members.
The Representative Council is a misnomer.
Many of its members are unknown to us and are unrepresentative.
We still do not know who they represent and CPA still refuses to let us know. The are not representative of the membership and to think they are the ones appointing new directors is just not on.
Again, it may be legal per the constitution, but this is an emergency because they are a big part of the problem. The use of Pacific Search Partners to shortlist directors, and for the current board to establish criteria for selection also has major problems.
And, perhaps most importantly, and most obviously, we the members have no say in all of this. We cannot vote directly for directors.
This is the chance for Greg Medcraft to get ASIC involved.
To think that the current board has such a critical influence in appointing new board members, and also a new CEO at this juncture is not acceptable.

5. I heard Alex Malleys interview with Chris Smith on the radio and felt ashamed that we had such a person as our CEO for the last 8 years. Jo Astons summary in saying it was ‘disgraceful’ is right. What sort of a leader would say that of their members.

6. In all of this one of the big casualties has been the accounting profession itself.
Many of these so-called experts and leaders serve on the International accounting boards which set our standards. Some of the standards used in consolidated accounting, minimum disclosure, auditing, and integrated reporting have been used to make our own reports far from transparent and in some cases have intentionally been used too misinform us and hide from us critical information (think remuneration and CPAA Australia Advice). This has involved one of the main professional accounting organizations in Australia (CPA Australia) as well as one of our largest accounting firms (Deloittes), and who knows who else has been involved in all of this.
The Corporations Act has shown to be in need of reform ,especially in relation to NFP organizations that use the Public Company Limited by Guarantee structure.
In all of this you get the impression that gaining more members and increasing income and global presence is critical driver when really it is the accounting profession itself (and its professional membership organisations) which needs to come under critical scrutiny.
Surely there needs to be a correction in the whole reason of why we actually have professional accounting organizations and what members can expect from them.
Things like professional development and high standards seems to have been relegated to lower level issues.

7. I appreciate, as I’m sure many of you do, that we need to have the current board leave immediately, but this also needs to be done in an orderly way so that we are not left leaderless, and that everything is done legally. That’s is why I think ASIC’s involvement at this stage would be the first option. Many of the directors and officers (both current and past) will surely be aware they could be facing significant ‘questions’ in the months ahead.
If ASIC lets this opportunity go by for whatever reason then they will have failed not only the CPA members who have limited capacity to act (both financially and from a corporate governance perspective) but also the watching world. This has been a pretty public ‘campaign’ and needs a ‘public’ resolution. Time for firm action from ASIC I suggest.

8. Well, I shall know a heck of a lot more in terms of what we can do at the end of next week. We certainly need to keep the pressure on, and I would like to see not only resolution to the matters for CPA to be restored to what it was, but also for those who have abused or misused their positions ands power to be held accountable.

The leadership of CPA Australia has been wanting for some time now. I’m hardly being radical or Robinson Crusoe in saying that. I still think one of the best things that can be done asap by the new board is to implement a close and independent forensic accounting investigation into CPA Head Office.
We all know that governance needs changing, and hopefully the review will provide a good starting point for that, but we need much more than that if our reputation is to be restored.



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Re: Brett's Weekly Update 5th July 2017

Post by passedfc » Thu Jul 06, 2017 9:05 am

Brett , thanks for the update.
Do we know how many we have signed up for the spill motion ??
Encouraging to hear the Fund is Up to $32 K and i am sure it will be used wisely.. and look forward to any progress next week.
I disagree that the review is " better than nothing" ... in fact is has dangerous implications that the CPA rotten rump will use this as a tool to say thae have addressed member concerns.. make some small changes to appease ... all done and move on.
agree that this board and exec . must be removed if any clean up is to be achieved. They are not to be trusted at all.
And as to preliminary report to board in September .. what a joke... we know what they do with fact now.. so the report will be irrelevant.
The head of the Panel McPhee .. should hop in the little orange datsun with Mallee and drive ... into the sunset... and he will ... taking some more cash for his trip.. !!!! ( his glowing endorsement of Mallee)
In terms of timing .. it is running out as many older FCPAs are seriously looking to move on... only because they have businesses to run etc.
Like all eminent panels ( with of Course all due respect) this one will do what they have scope for and I imagine the collective view already is to not go to deep but to have a "review " that satisfies the Board... the press... and the apathetic bulk of the membership.
Auditors ?? We already know how pathetic they are.. no value on pursuing them . " ...... we audit it regardless of whether it is misleading or not a complete picture... " ... Really !!!
As to the Divisional presidents and councils.. the appear to add no value into any process, ( they may have expressed concern to the Board about current issues , but have have no visible influence and seem powerless to do anything . Any future structure for CPA has to either abolish them or give them some accountability.
ASIC .... ??/ They do need a kick up the A... just to get their job done...
Greg Medcraft... Launching CPA Advice with mallee !!
As far as the current Board leaving immediately ( this is a must !) and leaving us leaderless !! well i am sure CPA can operated with out a board like the one in place. Yes Of course the removal must be legal and correct and this is where we run into serious procedural issue..
Interim Board and CEO appointed by ASIC. ??
it would not be the first time for an interim CEO for CPA .
Once again , I commend you for your fortitude, dedication and leadership on bringing all out in the open and ridding CPA of Mallee . (first step)
There are many capable and seriously talented people here ( this forum) and it is encouraging to see them all rally around in support.
Makes me wonder about an on going forum where respectful intelligent ideas and views can be share and aired..
Best wishes to you and the group for future success.

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Re: Brett's Weekly Update 5th July 2017

Post by ConcernedCPA » Thu Jul 06, 2017 1:17 pm

Is there a transcript of Alex Malleys interview with Chris Smith - what did he say about members??

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Re: Brett's Weekly Update 5th July 2017

Post by Stomper » Thu Jul 06, 2017 1:28 pm

ConcernedCPA wrote:
Thu Jul 06, 2017 1:17 pm
Is there a transcript of Alex Malleys interview with Chris Smith - what did he say about members??
Podcast is available here..... 7.00min mark is where he disparages the "protagonists" ... malley-20/

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Re: Brett's Weekly Update 5th July 2017

Post by Accountability » Thu Jul 06, 2017 1:29 pm ... malley-20/

talks about his 'exemplary' service, in growing the 'business'. still doesn't get it.

starts out thanking the AFR for getting his $4.9m payout. What a prick. Makes me sick. couldn't listen past the first few minutes.

the most narcissistic person possible.

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Re: Brett's Weekly Update 5th July 2017

Post by Red_Ferrari » Thu Jul 06, 2017 4:48 pm

Accountability wrote:
Thu Jul 06, 2017 1:29 pm
talks about his 'exemplary' service, in growing the 'business'. still doesn't get it.

starts out thanking the AFR for getting his $4.9m payout. What a prick. Makes me sick. couldn't listen past the first few minutes.

the most narcissistic person possible.

You lasted longer than I did. I switched off before the first minute mark. I am tired of the board, and every other dude in Melbourne, calling CPA Australia a "business" ... that's what got us into this mess.

As for the forthcoming loss of the PSC protection, they all should hang their heads in shame.

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Re: Brett's Weekly Update 5th July 2017

Post by Stomper » Thu Jul 06, 2017 5:04 pm

Accountability wrote:
Thu Jul 06, 2017 1:29 pm

the most narcissistic person possible. ... st/8677200

The office narcissist: how to spot (and deal with) them
ABC Health & Wellbeing
By Brett Worthington for Life Matters

The person whose self-belief exceeds their abilities, who rides roughshod over your considered opinions and practices, who's basically very focused on themselves.

In some workplaces, the person doesn't just belittle their co-workers and their contributions, they actually consider themselves so special and unique they are left infuriated when others fail to recognise them.

We're talking about the office narcissist.

"I have worked with two narcissistic bosses. I was constantly undermined, lied to with no sense of guilt shown by them. They attempted to turn staff against each other, and the worst [thing was their] character assassination, which was not only detrimental to me, but jeopardised business relationships with key customers. They breed in senior management and often fool those who don't work closely with them to think they are fantastic. My advice, leave the organisation." — Cathie

Expert Dr Ross King said one clue to spotting them is they don't generally pitch in and help out with the little selfless tasks that keep the office functioning.

"The narcissist will never be the person who packs the dishwasher in the kitchen. That's for other people to do."

In the narcissist's mind, packing a dishwasher would be deemed too menial a task to perform, said Dr King, an associate professor in psychology at Deakin University.

Left unmanaged, narcissistic behaviour has potential to wreak havoc on a workplace.

"You're going to see higher rates of absenteeism, you're going to have people leaving the job [and] going somewhere else because they don't want to work with this person," Dr King said.

"It has an impact on your workplace and your workplace's performance if you've got someone like this running riot behind the scenes with the other workers."

When the attitudes and behaviour that reflect a grandiose sense of importance occur in a consistent and enduring pattern, it's a diagnosable disorder known as narcissistic personality disorder, which affects about 1 per cent of the population

But most people have a degree of narcissistic traits, according to Dr King.

He said narcissism was a spectrum and how it was expressed differed according to the individual.

He listed business, law, politics and media as the professions most likely to attract narcissists.

"The person with narcissism is going to be directed towards [careers] where there is going to be admiration, fame, wealth [and] success," Dr King said.

"Narcissists are more likely to go for the big bang, the risky project or the risky endeavour that is going to be the place to shine.

"[They think] 'why would I just want to achieve mediocrity?'

"This is also true for CEOs and managers who are high in narcissism, [which has been] linked with CEO fraud in the US.

"It's a high-stakes thing. They believe they have better judgement so they will take these risks and then it can blow up."

"I've moved home to a small country town and narcissists have stacked the local committees. Their abilities are very over-estimated, they do not share information, they bully anyone who doesn't support them. The result is they deter others from participating and it leads to negative dysfunctional communities [that] blame government for [a] range of issues like youth leaving and ice." — Mary

"Underneath the narcissism is a person of low self-esteem. The only reason we criticise or put others down is to make ourselves feel better." — Glenda

What are the causes, symptoms and possible solutions to the growing trend of self-obsession?

Harnessing the potential

If harnessed correctly, Dr King said narcissistic tendencies had the potential to help an organisation succeed.

But he warned it was a fine line between narcissistic success and failure.

"A narcissist in a team can energise the team, [they] can really move them ahead because they're putting in these high standards," Dr King said.

"But there is another side to this.

"Narcissists over-evaluate their performance when we compare their rating of their performance versus objective assessments by others of their performance.

"One of the difficulties we have is they think they're doing much better than what objectively they really are."

Top tips for dealing with narcissists
Manage your emotions and maintain your professionalism

If you become frustrated and vent your anger to the person or co-workers, you not only risk appearing unprofessional, you risk backlash from the narcissist which may be in the form or anger, threats, undermining and sabotage.

Present your manager with options and ask their advice.

This will make your manager feel in control and allows you to get clear instructions on how to address the issue. It's best to write it down so use email. This makes you less likely to be criticised for adverse results.

Document your accomplishments in clear objective terms

This helps prevent a co-worker or manager from taking credit for your accomplishments.

Monitor the climate of your workplace

A narcissistic worker can create high levels of emotional stress. Managers should watch for increased absenteeism, resignations, or lack of cooperative office behaviours and other signs that seem to be linked to a particular individual. Unfortunately, the narcissist could be your manager.

Beware of 'red flags' before you hire

Be wary of any applicant who claims to have been the sole driver of significant changes or successes at their last workplace. Be especially alert to failure to acknowledge the contribution of others or seemingly overstating their position or role. Do your checks carefully to prevent inheriting another organisation's problem worker.

Source: Dr Ross King, Deakin University

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