Expert Witness Dilemma: A Case Study of Jefferson County in Alabama

Expert Witness Dilemma
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Expert Witness Dilemma
The dilemma involves the case of Jefferson County in Alabama filing for bankruptcy. The county reported rampant incidences of corruption, which had caused mismanagement of funds and a subsequent inability to pay off debts. Review of the case would require the application of accounting principles regarding the management of government assets regarding accounting. Important standards that would apply to the case are GASB 34 and GASB 58, along with other considerations outlined in the GAAP. The standards would provide major points that will determine the most suitable decision to apply in the case. Anybody involved in the process would need to be aware of the provisions of the indenture agreement on bonds the County possessed, previous court filings, testimonies of other witnesses, and reports parties with interest in the case would file with the court. The essay explores the factors that would influence the decision of the expert witness and proposes a final decision based on the information accrued from the case.
The first step is to establish that the County has legitimate grounds for filing for bankruptcy. The history of the sewer system indicates an inability to raise sufficient funds to facilitate proper maintenance of the structure (Guess, Broom & Reburn, 2016). The county took control of overseeing operations involved in the functioning of the sewer system in each municipality to ensure the operations complied with existent operational prerequisites. The county failed to receive compensations from municipalities to facilitate remedial efforts that would facilitate remedial efforts of the sewer system. Poor management of the available resources, poor implementation of the recovery plan, and corruption thwarted efforts to restructure the system to optimal working conditions. The County had to file for bankruptcy due to an inability to pay off existing debts (Guess, Broom & Reburn, 2016). The County reached the financial condition due to a switch from fixed rate to variable rate bonds, loss of income, the effects of the financial crisis that occurred in 2008, and rampant corruption. As per the financial standing, the county could not afford to pay the principal that became due immediately and had no way to raise the money shortly because the assets the county possessed could not clear the costs. By the provisions of the law, the government tried to intervene before the filing for bankruptcy through the appointment of a receiver (Guess, Broom & Reburn, 2016). The obligations of the receiver were to facilitate administrative duties, oversee operations and protect stakeholders involved in the operation of the sewer system. The receiver was at liberty to make the best decisions to rectify the situation of the sewer system. The efforts failed because the receiver refused to work with the county after a short while.
The second step is to review the agreement outlined in the indenture contract. The contract outlined the existent legal agreement between Jefferson County, which issued the bonds, and several bond possessors (Guess, Broom & Reburn, 2016). A section of the agreement provided an outline of a prescribed order of disbursing the revenu...