Created a PMR (65540,442,000) as I thought this was some kind of bug but apparently not.  Can't seem to find any logic about sound notification not being included from the developer statement.  What were they thinking???  Hopefully fix will arrive soon.

The development team returned with the update:
"IBM Verse does not support sounds on notifications.  The settings for audio, banners, etc are generic settings for any application that can receive notifications but does not indicate that the application necessarily supports them.  The only notifications you will get from verse are banners. The Audio Alerts setting is only used for calendar events that have alarms.  This setting has nothing to do with remote notifications from the server."