WHY WE NEED A FORENSIC AUDIT – Quotes taken from the Notice of Consideration of Annual Dues Increase Presented by LCPOA President Roy Paulson and LCPOA Treasurer Paul Gaarenstroom - Dated July 31,2026

 

1. We need a Forensic Audit because: “Beginning in fiscal year 2023-2024 increased operational spending has meant a decrease in the amount that could be contributed to our Reserve Account.”

   1. Paulson & Gaarenstroom admit the board has overspent its’ operational budget for the last 3 years as quoted in their Notice of Consideration of Annual Dues Increase dated 7/31/2026.

   2. How can the board overspend its’ operational budget for the last 3 years when the board reported a 6-figure surplus less than a year ago?

   3. If the board has overspent their operational budget for the last 3 years where is the notification to the membership as required in the Davis-Stirling Act?

 

1. We need a Forensic Audit because: “As of the July 2026 Board Meeting, our Finance Committee reported that we were 70.8% funded, with some vendor invoices still outstanding. The Board believes that a reserve funding percentage below 50% to be financially unhealthy.”

   1. The above quote was written on July 31st, 2026. What outstanding invoice will bring our dues from 70.8% funded to an unhealthy percentage below 50% to trigger a multi-year dues increase?

   2. The Board already knows the outstanding amount since all LCPOA expenditures require Board approval in Open Session. This is a large portion of our dues, not small expenditures and require disclosure per Davis-Stirling. 

 

1. We need a Forensic Audit because: “The Reserve Study explains a way to get our reserves into the ‘Good’ category. Using a 10% increase in reserve member contributions for our next fiscal year, plus additional increases for each of the following years. As you can see, our reserves dip into the ‘Poor’ category for many years under this approach – even with the multi-year projected increase in dues.”

   1. The purpose of the Reserve Study is to ensure there are enough funds for major repair and replacement of our roads and culverts. A Reserve shortage is a RED FLAG. We need a Forensic Audit to determine what happened to learn and not make the same mistake again.

 

1. We need a Forensic Audit because: “With regard to the member contribution side of the ledger, Director Boyd continues to present the direct and indirect costs associated with the ongoing lawsuits and threats. As of the July Board Meeting, he announced that these costs cumulatively over the past few years are in excess of $285,000.”

   1. The portion of our dues that should go toward reserves has been wasted on litigation. In less than a year our Operating Budget went from a 6-figure surplus to a required 20% dues increase which still is not enough to cover the shortfall.

2. We need a Forensic Audit because: “Please be aware that it is a mathematical certainty that a 20% dues increase alone will not get us to adequate reserve funding in the long run.”

   1. It is irresponsible to throw more money without identifying the problem. Our board has misappropriated our reserve funding for years without notification required under Davis-Stirling.