Bundred hits out at audit role

17 Feb 00
Auditors could be forced into making political decisions for which they are ill-equipped under the new Best Value regime, a House of Commons committee was told this week.

18 February 2000

Steve Bundred, chief executive of the London Borough of Camden, said he was concerned that Best Value would increasingly push auditors into new, more sensitive areas.

In evidence to the environment sub-committee, which is examining the role of the Audit Commission, Bundred said auditors' findings and evaluations could ultimately be used by politicians 'to trigger intervention' in failing local authorities.'Auditors will make judgements which in my mind are essentially political and, in my view, they are ill-equipped to do that,' he said.

Under Best Value, auditors will be responsible for evaluating and approving councils' mandatory performance plans. If they fail a performance plan they can write to the authority concerned or refer the failure to the Audit Commission, which could send in an inspection team. In the most contentious scenario, the commission could refer the authority to the secretary of state, John Prescott, or the National Assembly in Wales which would then intervene.

Bundred also questioned whether there were enough auditors with the necessary skills to carry out the new demands placed on them and the increased role for audit, planned from April 1.

Accountants giving evidence denied they would be making political decisions. But they echoed fears that fewer auditors were choosing to move into the public sector.

Mollie Bickerstaff, a partner with KPMG, said fewer trainees were choosing to become public sector audit specialists in firms such as hers because District Audit controls about 70% of the market.She said she 'worried whether enough people are coming in' to the public sector, especially given the imminent arrival of Best Value.

Eugene Sullivan, head of public sector services at RSM Robson Rhodes, said he would like to see a '50–50' split between District Audit and private firms in this sector.

The committee will hear evidence from local government minister Hilary Armstrong and the Audit Commission in its final session before reporting later in the year.


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