CTC’s choice ‘unsure’ of audit work on Verizon deal

The Commonwealth Telecommunications Commission may have hastily named a Majuro-based accountant to perform audit work on Pacific Telecom Inc., as he is reportedly unsure if he is willing to perform the work in connection with the proposed sale of Verizon’s local operations from Micronesian Telecommunications Corp.

This was learned after Gov. Juan N. Babauta and CNMI consumer counsel Brian Caldwell, in a joint submission to the CTC, asked that the commission reconsider its decision appointing Greg Tarasar as financial consultant to the telecom deal.

Babauta’s lawyer, Assistant Attorney General James Livingstone, said he recently contacted Tarasar, who allegedly claimed that he was “still unsure whether or not he planned on submitting a proposed scope of work.”

“He [Tarasar] needed to talk to his partner in Guam first before he could decide whether or not to undertake the required work,” Livingstone said. “He was not sure what issues would need to be examined.”

Livingstone and Caldwell pushed for the appointment of Boston-based Economics and Technology Inc. firm to perform the audit work. The company has submitted with the CTC a proposal, wherein it declared that it could perform the entire scope of work needed based on the agreement of MTC and PTI with the governor and the consumer counsel.

Besides PTI’s financial capability, the audit work needs to run projections on Verizon’s post-sale future revenues based upon a best case, worst case, and baseline scenarios.

The parties earlier agreed to contract the service of Deloitte and Touche, but the company had declared that it could not run the sensitivity analysis based on accounting’s best practices and company policy. Later, however, it said it could do such an analysis based on assumptions agreed to by the parties, which could not be reached.

Babauta and Caldwell said ETI is competent to perform the required scope of work, citing its extensive experience in the telecommunications field. The company claimed it could complete a draft report within a 40-day timeframe, which is comparable to that given by Delloite and Touché.

Babauta and Caldwell said ETI could perform the work for $54,450 to $64,450. They asked the CTC to declare that ETI has submitted the best qualifications and that the company be appointed as financial consultant in the audit work.