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Valley Electric releases audit after financial cover-up allegations

Updated April 16, 2019 - 11:50 pm

On Monday afternoon, Pahrump utility Valley Electric Association released an audit showing that its 2018 financial statements “present fairly” its financial position.

The cooperative conducted the audit in light of financial cover-up allegations within the company.

“The auditors found nothing,” said Michael Hengel, Valley Electric’s executive vice president of corporate communications. “It put us in a position to back up what we’ve been saying all along.”

The audit, conducted in February by Bolinger, Segars, Gilbert &Moss, looked at the cooperative’s statements of income, comprehensive income, patronage capital and cash flow.

Bill Miller, a tax partner at the Texas-based accounting firm, said the audit provides “reasonable assurance, rather than absolute assurance,” that financial statements are free of misstatements.

“The audit concluded that the financial statements of Valley Electric Association are fairly stated in all material respects,” Miller said via email.

The firm’s audit partner in charge of the VEA financial audit will present at the VEA’s annual meeting April 27.

Hengel said the cooperative is hopeful the audit “will begin the process of restoring the confidence in the cooperative’s members.”

Hengel is a former editor-in-chief of the Las Vegas Review-Journal.

In February, a group of cooperative members came together to advocate for the removal of board members after the utility announced a 9 percent rate hike, despite previous promises to keep rates stable through 2024.

A Feb. 22 search warrant from the Nye County Sheriff’s Office alleged that the rate hike, which went into effect last month, may have stemmed from former CEO Tom Husted’s use of ratepayer money to pay for a sexual harassment cover-up. On Feb. 26, CEO Angela Evans was arrested on embezzlement charges.

Valley Electric’s board denied the financial cover-up allegations.

The day after Evans’ arrest, Valley Electric announced that it had initiated its own internal investigation in light of recent events.

Interim CEO Dick Peck said that the cooperative’s special investigation came up with “absolutely no illegal activity whatsoever” on Evans’ part and that its findings were being shared with the Nye County Sheriff’s Office.

Sheriff’s office spokesman David Burochowitz said via email Valley Electric has “released nothing to us and (has) not spoken to us at all.”

Contact Bailey Schulz at bschulz@reviewjournal.com or 702-383-0233. Follow @bailey_schulz on Twitter.

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