Opinion ID: 4291042
Heading Depth: 5
Heading Rank: 1

Heading: The Testimony of Joseph Centofanti

Text: Joseph Centofanti, who was called by Resource Recovery, was qualified as an expert witness in the areas of accounting and auditing. Mr. Centofanti, after being qualified as an expert, began his testimony by explaining the auditing process in general. It was his testimony that the audits of governmental entities were governed by “[g]enerally accepted accounting principles, generally accepted auditing standards, [and] government auditing standards   .” He added that audits were also governed by the requirements imposed by the Rhode Island Auditor General and by the provisions in the contract between the parties. He noted that the requirements of the Auditor General included a requirement to report “any indications of fraud, abuse, or illegal acts that are noted   .” Mr. Centofanti testified that, based on his review of extensive materials, which materials he detailed in his testimony at length, it was his opinion that Restivo “lacked the experience to perform an audit of a quasi-governmental entity.” He further testified that Restivo “failed to test compliance with the applicable laws, regulations, contracts, and other agreements,” “failed to identify and report the improper charitable contributions,” and “failed to report internal control deficiencies that were identified.” He provided details of how an auditor would test the compliance of the trust investments with the investment policies of the corporation; and he added that, except for a single comment in the papers which he reviewed, he “couldn’t find any evidence    that [the trust investments were] reviewed for compliance” by Restivo. -8- Mr. Centofanti also testified as to the amount of money that had been donated by Resource Recovery in fiscal years 2006 and 2007 to charitable organizations which were not related to Resource Recovery’s mission. He testified that the charitable contributions for those fiscal years constituted “indications of fraud or abuse.” He further added in his testimony that, if Restivo had uncovered these contributions, it would have been obligated to report them to the Auditor General.