Who Is ‘Minding the Store’ at the Audit Bureau?

By: E&P Staff

In addition to its massive self-examination of circulation problems at its own paper, Newsday of Melville, N.Y., today also examined, as it it put it, “questions about who is minding the store” elsewhere, with special focus on the Audit Bureau of Circulations. And, according to Newsday, “some Wall Street analysts and advertisers now say the system is broken” at ABC.

It quoted a former, unnamed ABC employee: “ABC sends their best auditors to the biggest newspapers, like the Chicago Sun-Times and Newsday,” two papers embroiled in the current circulation scandal. “So what this is saying is, if their best auditors went into these papers, they kept signing off on no-good circulation year after year.

“You guys are cheating, granted, but ABC’s going in and saying you are correct. How come they’re not the ones who have to pay the advertisers now?”

ABC President Michael J. Lavery, however, responded in the same article: “I don’t agree that the process is broken. The audit works — it uncovered the problems at Newsday and Hoy.”

But Newsday reporter James T. Madore claimed that “the ABC rules governing how publishers account for their daily and Sunday circulation distribution are complex and riddled with loopholes, according to interviews with circulation directors and industry experts.”

A review of ABC’s “variation reports” since 1998 showed that about a dozen papers per year “have significant problems,” Newsday said, having inflated their numbers by 2% or more.

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