Schillo Withdraws His Support for Cohen

Furious about the withholding of key information, county Supervisor Frank Schillo on Tuesday withdrew his support for Assistant Auditor-Controller Christine Cohen to replace her boss, Tom Mahon, when he retires next month.

Schillo, one of three supervisors who had said Monday he backed Cohen’s appointment, said he now supports choosing an accountant from outside county government to serve the last two years of Mahon’s term.

And he said he will vote to put a measure on the March 2002 ballot that would make the auditor-controller’s post appointive.

“Withholding information, wow, that’s big,” Schillo said. “That’s overriding. If this was a corporation, the auditor would have been fired on the spot.”

Schillo and Supervisor John K. Flynn said at a morning meeting of the Board of Supervisors that they were upset that the auditor’s office had not told them about a state finding that the cash-strapped county owes the state about $7 million because of an alleged miscalculation by the auditor.

They learned about it by reading The Times on Tuesday morning, they said.

“That was the shock that put me over the top today,” Schillo said in an interview. “I find out they’re hiding information from the Board of Supervisors. I supported her appointment for continuity; I can’t support her now.”

Schillo said that since Cohen has essentially run the auditor’s department for months because Mahon has stayed home with his ailing wife, it was her responsibility to tell the board about the large new potential obligation.

The state audit was underway in June, when the supervisors were considering the county budget for the fiscal year that began July 1. The state controller’s office found that the county owed $7 million in September, and Mahon appealed the decision.

But neither Harry Hufford, county chief administrator, or the supervisors was told anything about the audit until Hufford was notified by county lawyers a few days ago, they said.

Schillo, Flynn and Supervisor Kathy Long--a majority on the five-member board--quickly announced their support Monday for the 43-year-old Cohen, Mahon’s top aide since 1994. They said they were impressed with her intelligence and skill, despite the office’s spotty record overall.

“Now I’d like to open up the process to anyone interested,” Schillo said. “Get your qualifications in and let’s have a look at you.”

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He said Supervisor Judy Mikels was also upset about the surprise $7-million debt. She could not be reached for comment Tuesday evening. Flynn was out of town and unavailable for immediate comment.

Reached at home, Cohen would not comment on Schillo’s decision.

“It’s their decision to make,” she said. “He hasn’t even talked to me about it. There’s nothing for me to say.”

Meanwhile, an informal survey of 52 of the state’s 58 counties Tuesday showed that three out of four have auditors who are certified public accountants or at least hold a degree in accounting--credentials that Cohen lacks.

In the seven Southern California counties, only Ventura and San Diego have auditors who are not CPAs.

According to the state’s Government Code, county auditors must either be a certified public accountant, have served as county auditor-controller or deputy auditor for at least three years, be a certified professional internal auditor, or possess an accounting degree or equivalent from an accredited university and have at least three years of recent experience in a senior fiscal management position.

Although some say the law should require beefed-up qualifications, many in the field argue that experience is just as important--if not more--than what someone can learn in accounting school.

Tyler McCauley, Los Angeles County’s appointed auditor-controller and a CPA, said lack of certification didn’t hinder his predecessor, Alan Sasaki, because of the dozens of other CPAs working under him. But, he added, “I personally believe it’s helpful and it brings prestige to the department.”

A CPA certificate also provides the public with the assurance that an auditor has a certain level of competency, said Curt Olsen, spokesman for the California Society of CPAs, representing 28,000 accountants statewide. To be licensed, accountants must go through professional and ethics training and pass a rigorous exam, he said.

John Lacey, chairman of the society’s Accounting Principles and Auditing Standards Committee and a professor of accounting at Cal State Long Beach, said he would require county auditor applicants be CPAs if he were writing a job description.

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“It’s like buying UL-approved appliances--there’s a minimum standard you can expect,” Lacey said. “And I think that’s important.”

Olsen said another assurance for the public is that CPAs are open to disciplinary action from the California Board of Accountancy.

“Our board has authority over them, so if in fact there is some failure, we could take action against their license,” said Carol Sigman, executive officer of the state board.

Santa Barbara County Auditor-Controller Robert Geis, a CPA with 22 years of county government experience, agreed that it helps in the job to be a CPA.

However, he said that if an auditor candidate had only one of the requirements, time in a related post would be the most valuable.

“When you get into these jobs, it’s very complex,” Geis said. “That experience in the office means a lot.”

Bill Siverling, a lobbyist for the California Assn. of County Auditors, said on-the-job training is becoming more and more important for county auditors.

“A lot of the duties have gotten away from pure examination of the books,” he said. “There should be just as much emphasis on administration abilities.”

Cohen, who has 21 years in the county auditor-controller’s office, said she thinks that the law holds public auditors to a high enough standard. She has a bachelor’s degree in business administration, an MBA in finance and investments, and is a certified government financial manager.

Greg Stratton, a former Simi Valley mayor who challenged Mahon for the office in 1994 but was disqualified by the courts because he didn’t meet any of the legal requirements at the time, said that being a CPA shouldn’t be necessary for the job.

The rejection of his candidacy prompted him to push an amendment to the law that changed the rule for auditors to be graduates of a “school of accountancy” to making them hold an “accounting degree or equivalent.” An equivalent degree must include a substantial number of accounting units, however, said an official at the state board of accountancy.

Cohen said that not being a CPA doesn’t preclude her from signing county audits--a controversy that swirled around Mahon during his 1994 reelection bid.

“Doing the job is different than book learning,” Cohen said, adding that family and other commitments took priority over obtaining a public accountant certification early on in her career. “A CPA, although it’s a very good license to have, may be used in limited areas. With experience in the office, I’ve been able to cover every aspect of the auditor’s position.”

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Other auditor-controllers backed up that assertion.

“I feel you can do your job and implement it without the paper,” said Irene Doyle, auditor for Lassen County. She is not a CPA but holds an accounting degree.

“A CPA is a good thing to have,” said Gere Sibbach, San Luis Obispo County’s auditor who worked with Cohen on a committee in the state controller’s office. “But the auditor-controller’s job is much more than that nowadays. You’re really more of a financial manager.”

A few California counties have merged the auditor-controller with the county treasurer, allowing them to have different--sometimes tougher--standards.

In Sacramento County, all accounting positions within the new Department of Finance require at least an accounting degree, said Bob Haagenson, chief administrative officer for the department.

“It’s just the level of work they do. . . . They tend to be more successful if they have one,” he said.

Stratton said he has no problems with Cohen’s qualifications, but said he would rather the Board of Supervisors look to someone from outside county government to replace Mahon.

“These people are brought up in the system, and it’s not that they do anything wrong, but that they just don’t know anything else,” he said.

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Ragland is a correspondent and Kelley is a Times staff writer. Staff writers Tina Dirmann, Steve Marble, Nicholas Riccardi and Margaret Talev, and correspondents Gail Davis, Katie Cooper, Catherine Blake, Traci Isaacs, Nancy Forrest and Josh Karp contributed to this story.

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A look at Assistant Auditor-Controller Christine Cohen. B3