Editor's Note: Gregory Cook, CPA, responds to letters sent to him by TWHBEA candidates questioning election proceedings.

August 14, 2007


Attn: Chuck Cadle, Executive Director

P.O. Box 286

250 N. Ellington Parkway

Lewisburg, TN 37091

RE: TWHBEA Annual Election of Directors and Proposed By-Law Amendments


The purpose of this letter is to provide information concerning the TWHBEA election and voting process when an outside independent auditor is engaged. The facts are as follows:


Prior to accepting this engagement, I considered my firm’s independence. As a Certified Public Accountant licensed by the States of Alabama and Tennessee I have taken the following steps to insure independence. All employees of Cook & Co. (ten full-time and four part-time employees) have been questioned by me personally on the following subject matters:

1) Family relations to current Board members or candidates – Neither I nor any of my employees or our extended family members are related to any of the current Board members or candidates.

2) Business relations with current Board members of candidates – Neither I nor any of my employees or our extended family members have any business dealings with the current Board members or candidates.

3) Membership in TWHBEA or horse ownership – Neither I nor any of my employees or our extended family members have a membership in TWHBEA or an ownership interest in any Tennessee Walking Horses.

4) Conflicts of interest – Neither I nor any of my employees or our extended family members have any interests that would conflict with my firm acting as Independent Auditor for TWHBEA.

5) In addition to the above, I must consider whether the fee for providing services to TWHBEA would be “material” to the operations of my firm. Total fees paid by TWHBEA to Cook & Co. represent LESS THAN 5% of our Annual Gross Revenues.

TWHBEA’s Responsibility in the Election Process

It is TWHBEA management’s responsibility to perform the following functions in the annual election process:

1) TWHBEA shall determine as of May 1 of the election year the seats that will be available to fill. NOTE: There were multiple problems last year that would have caused me to decline the engagement this year if I was not satisfied that adequate measure have been taken by TWHBEA to prevent those same problems from recurring this year.

2) TWHBEA shall determine the eligibility of candidates that declare their intention to run for office by August 1.

3) TWHBEA will verify the eligibility of any write-in candidates received by Cook & Co.

4) TWHBEA is responsible for printing and providing the ballots to Cook & Co. NOTE: There were multiple problems last year that would have caused me to decline the engagement this year if I was not satisfied that adequate measures have been taken by TWHBEA to prevent those same problems from recurring this year.

5) TWHBEA is responsible for printing mailing labels to eligible voters and labels with corresponding member numbers (as of August 1) and providing same to Cook & Co.

Independent Auditor’s Responsibility

Although the TWHBEA By-Laws dictate steps to be followed in the event that the election process is handled in house by TWHBEA, the By-Laws do not dictate how the Independent Auditor handles the process. The following is a list of steps we take in the process:

1) We print the outgoing envelopes and have the return envelopes printed.

2) After receiving the ballots and labels from TWHBEA, we affix a member address mailing label to the outgoing envelopes and affix a member number label to the return envelopes.

3) We stuff the outgoing envelopes with ballots and return envelopes.

4) We seal and place postage on all outgoing envelopes.

5) We deliver envelopes to the United States Postal Service (August 15 for overseas mail and September 15 for continental United States mail).

6) As the return envelopes arrive at the Post Office, the United States Postmaster keeps a count of the envelopes received and retrieved by my firm ( a written daily record certified by the Postmaster).

7) One member of my staff is responsible for retrieving the envelopes from the Post Office and bringing them unopened to the office up until and including our cut-off date (historically October 15th deadline).

8) A second staff member is responsible for opening the envelopes and logging the votes on spreadsheets.

9) If a write-in vote is received,the eligibility of the candidate is verified or confirmed by TWHBEA.

10) Ballots are then stapled to the return envelope and filed by state or region.

11) A second count of the ballots is conducted by a third staff member and me.

12) All returned ballots and spreadsheets are then sealed and stored in our retired files and I personally write a summary repot of the official results and deliver it to TWHBEA.

Statement regarding the Fall 2006 (last) Election

I have received three (3) identical faxes dated August 13, 2007 from Freda Dean, Michael Inman and Bruce Vaughn stating that “It is widely believed that irregularities occurred with the ballot counting of the 2006 election” (copied attached). There were no irregularities with the ballot counting. The 2006 Tennessee ballot read “Vote for Three” when it should have read “Vote for Five”. The seat availability and printing of the ballots was conducted and overseen by Mrs. Sharon Brandon, Secretary of TWHBEA, not my firm. The fact that the top five vote getters rather than the top three were seated had no impact on my vote count whatsoever. The decision to seat the top five was not made by my firm (beyond the scope of my engagement). We still have all of the records from the election last year and would welcome a review.

Statement regarding the upcoming Fall 2007 Election

In the above referenced faxes, Freda Dean, Michael Inman and Bruce Vaughn each requested that my firm either not handle the vote counts this year or provide an opinion from the Alabama Accounting Board as to the propriety of my firm handling this engagement.

First I must say that preparations for the upcoming election began in July. 18,000 outgoing and 18,000 return envelopes were printed. All of the ballots that are going over-seas are already stuffed and ready to be postmarked tomorrow (August 15). In an effort to address the three candidates concerns, I telephoned Lamar Harris, Executive Director of the Alabama State Board of Accountancy in Montgomery and presented him with their request. Mr. Harris informed me that the State Board does not issue opinions, but gave me verbal confirmation that the AICPA Professional Standards do in fact allow my firm to audit the financials of TWHBEA and certify the results of the vote count of the annual elections. Mr. Harris forwarded an eight (8) page fax to me.

The three faxes from Freda Dean, Michael Inman and Bruce Vaughn incorrectly state that my firm prepares the monthly financial statement of TWHBEA. We do not. TWHBEA prepares their own monthly financials statements and my firm is engaged as an independent outside auditor to audit those financials.

An audit of the auditor may sound silly to some people, but it’s not. It is every TWHBEA member’s right to question our conduct, work and even integrity and it is the TWHBEA Board’s responsibility to do so. My firm undergoes a Peer Review (we are audited on our audits). Our most recent Review was conducted by the Certified Public Accounting firm of Mann, Poarch, Miller and Key, P.C. who have offices in Birmingham, Alabama and Chattanooga, Tennessee. We received an Unqualified Opinion in their report, which was approved “unmodified” by the Peer Review Committee. The results of our Peer Review were presented to the TWHBEA Board. Anyone may check with the Alabama or Tennessee State Boards of Accountancy to verify that my firm has never had a complaint filed against us in the last fifty (50) years of doing business at the same location. I have been the sole owner of the firm since December 1994 and I take great pride in my business and my reputation.

In closing I would like to express my appreciation, pleasure and respect for your association, staff, Board of Directors and members, even during these turbulent times when there seems to be much disagreement among your membership.

Gregory J. Cook, EA, CPA

U. S. Treasury Card # 47640

Alabama State Board #6134

Tennessee State Board #14339