Alex and Tonja Oria - Page 5
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The $248,524 Omission
Medico made salary payments to Mr. Oria by check. Mr. Oria
signed those checks for Medico. Mr. Loeser advised Mr. Oria
that, whenever, on Medico’s behalf, he wrote a salary check to
himself, he should write a second check on Medico’s behalf to
cover applicable withholding and employment taxes.
Mr. Loeser or a member of his staff would record salary
payments to Mr. Oria in the general ledger in one of two ways.
Generally, if a corresponding tax deposit had been made, the
payment would be recorded as a salary expense (i.e., debited to
an account labeled “Officer Salaries”). If Medico lacked
sufficient funds both to pay Mr. Oria’s salary and to make the
necessary tax deposit, the payment would be recorded as an amount
due from Mr. Oria (i.e., debited to an account labeled “Due from
Officer” (sometimes, Mr. Oria’s drawing account)). The amounts
debited to Mr. Oria’s drawing account were not true loans, but
were only classified as due from him to give cover to Medico’s
failure to make adequate tax deposits. The expectation was that,
when sufficient funds became available, and Medico made the
delinquent tax deposits, the improper classification would be
corrected; i.e., the Due from Officer account would be credited,
and the Officer Salaries Account would be debited, to properly
reflect all of the payments to Mr. Oria as salary. No such
corrections were made, however.
Bayliwix, Inc. (Bayliwix), is a corporation owned by Mr.
Loeser. The following are unincorporated businesses or trade
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Last modified: November 10, 2007