“Everybody in this game should be aware of where their money goes” - Wade Boggs
“Find someone to mentor you who doesn’t have their hands in your pocket” – Deion Sanders
An NFL Players Association survey found that at least 78 players were defrauded of more than $42 million between 1999 and 2002. Currently, many professional athletes and entertainers are still being taken advantage of. An audit is a great defense against fraud.
What is an Audit?
Many people relate the word audit to a bad thing such as an IRS audit. While an IRS audit is not a good thing especially for the one being audited, it does accomplish what it sets out to do. It catches people who cheat on their taxes. Audits are designed to catch cheaters.
The true definition of an audit is to ascertain the validity and reliability of information. In other words, an audit makes sure things are proper and accurate. It’s the watchdog. In the case of a professional athlete, a lot of trust is placed in the hands of the money manager. An audit provides assurances to an athlete that whoever is handling their money for them, they are doing what they should be doing and not doing things that they should not be.
Most professional athletes have an accountant. Isn’t that enough? Most accountants primarily handles your tax returns, this is not enough to detect improper money management. An athlete really needs to have someone overlooking their money managers’ shoulders to ensure proper handling of money. An audit does cost money, although not having an audit performed could prove much more costly in the long run.