CFO Brad Goulding wanted to redefine connection between Premier Resorts International and PRU
July 7, 2009
Premier Resorts International’s chief financial officer Brad Goulding and his attorney Kenneth Cannon tried to conceal the connection between the company and its Utah affiliate Premier Resorts of Utah at Monday’s bankruptcy hearing with Trustee Steven Bailey.
When asked if Premier Resorts of Utah (PRU) was operated out of the same location as Premier Resorts International (PRI), which it does at 1375 Deer Valley Drive, Goulding said the company operated out of several locations, one of which was the same office as PRI.
Bailey asked if any of the other locations stored financial or rental records. Goulding said accounting was done at the office in the Deer Valley Plaza Building PRI’s headquarters.
When Bailey began questioning Goulding on the "sweep" account into which all monies from PRU and other PRI affiliates went in, and from which overhead expenses for the affiliates went out, Goulding initially tried to dodge the question.
"Are there any other books held by any other entity that accounted for the sweep account?" Bailey asked.
"Each operation had its own books," he said.
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After a few more questions Goulding admitted that the account was in the name of PRI.
Next Bailey asked who reconciled the account and made sure transactions were done accurately. Goulding said local property controllers reconciled the accounts.
Even though Goulding is CFO of PRI, when Bailey asked who did overall reconciliation for PRI, Goulding said it was his accountants and controllers, mainly Ariane Spicer.
Bailey asked if they were still with PRU. Goulding said no, but they were still employed by PRI.
Seeking to get Goulding to accept full responsibility for both PRI and PRU, attorney for Deer Valley David Broadbent asked if there were any other officers of PRU besides directors Goulding and co-owner Barbara Zimonja, president of PRI.
Goulding said he could not recall.
But when asked who occupied the executive suite at the company’s offices, Goulding answered that it was only he and Zimonja.
At that point Goulding’s attorney, Cannon, interrupted and said he would not permit questions about PRI since he only represented PRU, and Goulding was only present as director of PRU.
Park City attorney Joe Wrona asked Goulding to take responsibility for PRU’s accounting. Goulding said he oversaw the company’s controllers and Spicer oversaw PRU’s accountants suggesting he had no direct connection to the company’s books.
Under questioning from Park City attorney Joe Tesch, Goulding said that 59 percent of the gross income in the sweep account came from PRU. Without knowing PRU’s expenses, it is impossible to determine whether PRU used all of that money for its own overhead and expenses, he said.
Goulding’s attempts to separate PRU from PRI ended once Goulding was forced to concede that his salary was paid solely through PRI. But he still insisted that he did not do any of the allocating of funds for PRU.
Tesch next attempted to get Goulding to take responsibility for PRU’s failed budgets. Goulding said their business plan did predict a slower year than the one before, but said he did not foresee the company’s inability to make March payments to condo owners for February.
Tesch asked if he "woke up one morning and was surprised" by the fact. Goulding objected to the wording of the question, but did not answer it one way or another.
He did say that portions of payments to owners were paid from advanced deposits, but when asked if deposits from April were intended to pay owners for February, Goulding again objected to the wording and argued over semantics.
The last item that came to light in the hearing securing PRU and PRI’s connection, is the fact that retirement plans were available to PRU employees through PRI.
The next hearing is scheduled in roughly two weeks.