Commission vindicated over role in Bradford NHS trust

10 Feb 05
Audit Commission chief executive Steve Bundred this week stepped in to heal a potential breach with foundation trusts' regulator Monitor over the troubled Bradford Hospitals trust.

11 February 2005

Audit Commission chief executive Steve Bundred this week stepped in to heal a potential breach with foundation trusts' regulator Monitor over the troubled Bradford Hospitals trust.

Last autumn it emerged that the trust could face a deficit of up to £11m in the 2004/05 financial year. When it was awarded foundation status last April, the trust had projected a surplus of around £2m.

Monitor published reports from consultancies McKinsey and Alvarez & Marsal last week that found the regulator had been over-reliant on the Audit Commission, in its role as the trust's external auditor, and independent accountants PricewaterhouseCoopers.

Monitor chair Bill Moyes appeared to question the commission's ability to work with foundation trusts when he said such bodies should choose auditors with extensive commercial experience.

Bundred told Public Finance this week that the commission had been vindicated by these reports and an internal inquiry. 'We thought it was right to take a good look at whether there were any concerns about our audit. We are completely satisfied our audit was fine.'

He added: 'In fact, it was our auditor who spotted that Bradford was proposing to include as income in its accounts a sum in excess of £2m that wasn't included as expenditure in the accounts of the primary care trust. A disclosure note to that effect was placed in the trust's 2003/04 accounts.'

Bundred said he had held talks with Moyes and insisted the regulator had been misinterpreted.

He said: 'We agree with him that foundation trusts operate in a commercial environment. We are the largest auditor of foundation trusts at the present time and we have quite a lot of people with the necessary experience.'

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