I haven’t read through the Motion which you were kind enough to forward. One item did pop out when I scanned through it. Under Paragraph 69, listing income that should have appeared on a W-2 is:
“Unpaid loans with no interest charged $81,588.86”
Now, an unpaid loan isn’t income; it is treated as income if and when written off, and would not be reported on a W-2, it would be reported on a 1099. I have no opinion one way or the other items on the list, which I would have to research. But the one that I do know is not correct.
The forensic auditor is the one who made the determination that it was "income." She does this stuff for a living, and is also a former IRS auditor, and thus presumably knows the difference between loans and income.
I can only guess at her reasoning, but I suspect it had to do with the fact that the loans were both unpaid, and interest-free. And, besides that, the loans were effectively "written off" by virtue of the fact that they were never pursued: there was no loan agreement, no schedule of repayment, and no attempt to collect the outstanding balances. They have more an appearance of "gift" than "loan."
Anyway, whether or not it's "income," it is nevertheless illegal under Colorado law for the officers of a non-profit corporation to receive such loans.
Further details on the loans are fleshed out in the following section.