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Brown had held the top position for more than two decades.
His departure was one of a few leadership changes over past weeks: Club president Adam Cossar resigned from his position two weeks earlier. His interim replacement, James Macmillan, also resigned just days after filling the position. Macmillan remains as a board member.
An email sent to signatories of the letter on Sunday, and obtained by this masthead, informed recipients that O’Loughlin had agreed to meet with the group in the next two weeks to discuss their concerns.
O’Loughlin did not respond to calls or text messages sent by this masthead.
“We have received agreeance from the interim President to meet and we are hopeful to hold a meeting during the week commencing on 26th February - if not, 4th March,” the letter sent to signatories read.
The email also outlined the three areas of concern addressed in the letter they are seeking a response to. Chief among those accusations was: “The Board’s failing in its fiduciary responsibility to provide Members with a sufficient explanation of the circumstances resulting in the much-publicised significant loss of Member funds.”
Also listed as issues the group is seeking to resolve was the claim that the board failed to disclose the details of the recommendations that came from the Grant Thornton review, as well as criticism to how it handled a grievance proceeding filed by one of the group’s members, Rob Dennis.
The email also pointed to the group’s newly launched website, and encouraged the letter signatories to share it with other members to “capture suggestions”. Data shows the website’s URL was registered on Friday.
“We are a diverse group of Kooyong Members who want to make improvements around how our club is run,” the landing page of the site reads.
“You are joining a community dedicated to transparency, accountability, strong governance, and a world-class member experience.”
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The website copy says the group is planning to host member events, send letters and petitions to club leadership, call a special general meeting to “demand accountability” from the board, and advocate for members on key issues.
Rules set out by Consumer Affairs Victoria stipulate that a special general meeting can only be held for a specific purpose.
“Special general meetings often deal with business that can’t wait until the AGM. A range of matters may be considered, including those that must be decided by a special resolution,” the regulator’s website states.
Board releases new detail on Grant Thornton review
The letter delivered to Macmillian on February 20th was followed by an update to members later that week, assuring that changes have been made to its accounting process, and that the dining and functions operations had returned to “normal levels of profitability”.
In the update, the board disclosed more detailed information from the findings from the audit, but said it cannot provide the report in full, blaming commercial confidence.
They added that a meeting would be held on March 25th to discuss the Grant Thornton findings with members face-to-face. This is in addition to the meeting promised to the Kooyong for Members group.
The board’s message to members with more detailed findings from the Grant Thornton report
- “Inappropriate accounting practices were in operation for the recording of the actual costs of both food and labour. The actual costs were not being reconciled and reported until the end of the financial year.
- “Purchasing procedures: there were no management controls around the selection and changes of suppliers. This included a lack of controls relating to price comparisons, ordering, wastage, invoice processing and the checking of deliveries.
- “The procedures being used for the stocktaking of food were not at the required industry standard resulting in a lack of transparency to assist in recording, re-ordering and wastage reporting.
- “The management pricing policies were not documented, were unclear and inflexible.
- “Management reports prepared for the Board were developed using the inappropriate accounting practices identified above. Therefore, the monthly financial results submitted to the Board were inaccurate and did not reflect the actual financial position at the relevant time.”
It listed five key findings from the review, including that there was “inappropriate” accounting practices in operation, incorrect procedures with “lack of controls” and that the board was receiving inaccurate financial information in the lead up to the discovery of the multimillion dollar loss.
The update added: “When the Board became aware of the financial loss, the management accounting and procedural issues in September 2023, remediation actions were quicky [sic] implemented. The board would like to sincerely thank the Kooyong staff for their commitment and dedication to ensuring that the remediation actions were implemented.”
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