At the interim Pacifica National Board meeting held in New York City on January 11-13, 2002, the first motion passed was to accept a gift of $20,000 from an anonymous donor for the purpose of hiring the accounting firm of Kimerling, Margulies & Wisdom, Ltd. to determine the state of the Pacifica Foundation's finances no later than January 31, 2002.

This audit was done, and it reveals a Pacifica Foundation that is in a precarious financial situation. The audit attempts to show the financial condition of the Pacifica Foundation as of December 31, 2001. As is noted in the cover letter, however, the scope of the audit was limited by both the two week time limit and the fact that the general ledger, accounts payable and bank reconciliations had not been kept up to date since October 1, 2001.

It has previously been reported that the Pacifica Foundation is $4.8 million in the red. This figure appears on page 6 of the audit.

The Pacifica Foundation web site gives only a copy of a fax of the bare bones audit but says, “Additional text and the recommendations of the auditor will soon follow.” A number of things stand out from the raw numbers, however:

• Former Pacifica Management appears to have reduced the assets of the foundation by almost $5 million in the period between June 30, and December 31, 2001 (p. 3).
• WBAI topped all Pacifica stations in listener donations as well as total expenses for FY 2000 (p. 4).
• Total revenue for Pacifica was up $226,928 in 2001 (p. 5).
• WBAI is listed as having raised $145,890 from “community events” in FY 2001. What were those events? (p. 7)
• In the period 10/1/99 to 12/31/01 Pacifica spent $1,158,193 on legal services from Epstein, Becker & Green, which employed PNB member John Murdock (p. 9).
• In the period 10/1/99 to 12/31/01 Pacifica spent $445,957 on services from Westhill Partners, a public relations firm (ibid.).
• This audit projects an additional $1.5 million deficit by December 31, 2002 (p. 10).

For the audit in .pdf format CLICK HERE. This file, for which you will need the free Adobe Acrobat Reader below, is 863 KB in size.

For those who prefer not to use the Adobe software, here is the audit in a set of images that any browser can read.

These financial matters are so grave that the iPNB held a special meeting by telephone conference call about them on February 15, 2002. Here is a draft of the minutes of that conference call meeting.

This page will be updated as events warrant.

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