Palm Springs Art Museum Refutes A Report Calling its Finances Into Doubt

"The paper claims that after a January audit, accounting firm Eide Bailly attached to its report a "letter of material weakness," a standard practice that alerts the client to what the paper calls "the reasonable possibility that its internal statements are significantly out of whack." Since then, "at least eight" trustees, or a third of its board, have reportedly resigned. These departures, one apparently based on legal counsel, have left 19 members, short of the 20 required in the museum's by-laws, says the report."

"We respect the role of an independent press. At the same time, the column is based on selective internal correspondence and does not fully reflect the work we have done with our auditors and outside advisors over the last several years. Some of its characterizations of the museum's financial condition and board oversight are not consistent with the facts as understood by our board, management, auditors, and independent consultants."

A January audit prompted accounting firm Eide Bailly to append a letter of material weakness, indicating a reasonable possibility of inaccurate internal statements. The audit identified a deficiency in internal control and cited problems with reporting of endowment spending, improper recording of the market value of donated and deaccessioned art, and faulty recording of admissions revenues. At least eight trustees resigned, leaving 19 members, one fewer than the 20 required by the museum's by-laws. The museum issued a statement disputing selective correspondence and said work with auditors and outside advisors over several years has aimed to refine practices; board leadership says reviews were thorough and followed a clear path for improvement.

Read at ARTnews.com