Audit Provision Leaves Questions Unanswered

HIL ANDERSON, SENIOR EDITOR
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Chicago, IL – A controversial provision in the McCormick Place reform legislation requires an audit to be conducted twice a year on the bills that show organizers and contractors send to their exhibitors. The intent is to insure that cost reductions are passed on to exhibitors. However, the language of the bill failed to provide details on what types of records will be subject to scrutiny by the Metropolitan Pier & Exposition Authority.

Here is the wording in the legislation, verbatim:

“The Authority shall retain the services of a person to complete, at least twice per calendar year, a financial statement audit and compliance attestation examination, to determine and verify that the exhibitor rights set forth in this Section have produced cost reductions for exhibitors and those cost reductions have been fairly passed along to exhibitors.

“The financial statement audit shall be performed in accordance with generally accepted auditing standards. The compliance attestation examination shall be:  (i) performed in accordance with attestation standards established by the American Institute of Certified Public Accountants and shall examine the compliance with the requirements set forth in this Section, and (ii) conducted by a licensed public accounting firm, selected by the Authority from a list of firms prequalified to do business with the Illinois Auditor General.

“Upon request, a show contractor or manager shall provide the Authority or person retained to provide auditing services, with any information and other documentation reasonably necessary to perform the obligations set forth in this subsection. Upon completion, the report shall be submitted to the Authority and made publicly available on the Authority’s website.”

Trade Show Executive will provide analysis of the practical effect it will have on trade shows as it becomes available.