Auditors should be "held to account" for causing negative publicity over county's accounts, says councillor

County Cllr Edwards has criticised auditors for causing "a wave of negative publicity" over a complex loan deal.County Cllr Edwards has criticised auditors for causing "a wave of negative publicity" over a complex loan deal.
County Cllr Edwards has criticised auditors for causing "a wave of negative publicity" over a complex loan deal.
A councillor has blasted auditors after they 'magically' resolved an accounting query which caused 'negative publicity' for Lancashire County Council.

Accountancy firm Grant Thornton was unable to give its final opinion on the authority’s books last month, because of a question mark over a complex loan deal.

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County council's accounts get the green light after loan deal caused delay

The council’s external auditors have now given the green light to the way the loan was recorded - but one member said damage to the authority’s reputation had already been done.

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“There has been a wave of negative publicity that [suggested] we couldn’t get our accounts signed off, because of the opinion you took last month,” County Cllr Charles Edwards told a Grant Thornton representative at a meeting of the council’s own Audit, Risk and Governance Committee.

“I don’t know whether it was acceptable for you to have made this judgement [then] and now come back a month later - and it’s magically all fine again.

“I think the [council’s] finance team do a sterling job and this has put a burden on their shoulders that they didn’t need.

“I’d like to see Grant Thornton held to account for that,” County Cllr Edwards, a Conservative committee member, added.

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The query related to the way in which the liability of the loan - known as a Lender Option Borrower Option (LOBO) - had been assessed. Other authorities with similar arrangements have had their accounts signed off by different auditors.

Responding to the criticism, Mike Thomas, a Director at Grant Thornton, said: “[We] have led the discussion with other [accountancy] firms to get a resolution of this matter.

“Unfortunately, that didn’t happen in time for the end of July. Other firms took their own views and decided to sign off.