Richard L. and Kelly D. Robson - Page 15




                                       - 15 -                                         
               It is not enough for petitioners to claim that the entries             
          recording loans to shareholder must have been made in error.  The           
          record makes it abundantly clear that petitioner was ignorant               
          about financial and accounting concepts when he purchased Mid-              
          Nebraska’s stock and continuing at least through  the audit of              
          petitioners’ 1993 return.  It is also obvious that petitioner               
          made no effort to acquaint himself with Mid-Nebraska’s financial            
          records or the accounting entries made on those records or the              
          data reported on the corporate tax returns.                                 
               Petitioner testified that he did not know of what the loans            
          to shareholder accounts consisted and that he was not even aware            
          that Mid-Nebraska’s books reflected loans to shareholder until              
          after York took over the corporation’s business.  He testified              
          further, however, that he did not understand the corporate books            
          and relied totally on in-house bookkeepers to keep the corporate            
          books and on outside accountants to prepare the corporate tax               
          returns.  He stated additionally that when he reviewed the                  
          corporate books, he checked only for the amount of premiums he              
          had written each month.                                                     
               Petitioner failed to present any testimony from individuals            
          involved in preparing Mid-Nebraska’s books and tax returns who              
          could explain the nature of the loans to shareholder accounts               
          included on Mid-Nebraska’s books or otherwise establish that the            
          accounting entries were made in error.  The failure of a party to           






Page:  Previous  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  21  22  Next

Last modified: May 25, 2011