This is a copy of the email I have written to senior officers at Cornwall Council:
I attended a very disturbing meeting of the Audit Committee on Friday.
The good news is that the measure I fought for in the last Council of
having independent members on the Audit committee who actually know
something about audit (not just councillors doing their best) is bearing
The last item on the agenda related to the appointment of external
auditors. I was astonished to hear an independent member of the
Committee say that the Committee was being asked to make a decision
about how to appoint its auditors after the official deadline for one of
the two methods (the national method through Public Sector Audit
Appointments Ltd (PSAA)) had passed (although we might still get under
I also heard from an independent member that 99% of similar bodies use
the PSAA method. This seems correct as if one looks on the PSAA website
only 11 bodies are using the other route. Two of these are Cornwall
Council and the Council of the Isles of Scilly. Indeed, from this it
appears that the decision has already been made. Cornwall Council is
listed as having made the decision to go the other route.
The paper for members (which omitted to explain any of this relevant
information) said that the benefit of us doing our own procurement is
that we could 'keep it local'.
This would be great. However, the fundamental point with auditors is to
ensure that the Council’s relationship is not too ‘cosy' with them.
Further, they should not only be independent but be seen to be so.
When I asked which firms would meet all the criteria set by the Council
about locality working and have the skills for the job, it became
apparent that it would only be Grant Thornton. Other national firms
would have the qualifications but they would need to fund a local
It was the view of the independent members of the Committee that the
work of auditing Cornwall Council, RCHT, Council of Isles of Scilly and
related Council companies was unlikely to justify an office.
I have no reason to doubt the integrity of Grant Thornton but clear and transparent processes are very important.
In this connection, my reason for attending the Audit Committee was that
I understood there would be an update on the National Audit Office
investigation into the Council’s LOBO debt. There was. Grant Thornton
said that the investigation was ongoing and was unlikely to be resolved
before August (so nearly a year).
This has arisen out of objections to the Council’s accounts about debt
inherited from the old Lib Dem led County Council. The objector is, I
understand, seeking to establish as to whether the LOBOs (particularly
the ‘inverse floaters’, described by the auditors as ‘unique to
Cornwall’ - not in a good way) are ‘irrational’ and possibly illegal.
They certainly appear to be irrational. This was a case of heads the
banks win and tails, Cornwall loses.
In a spirit of independence and transparency I would be obliged if the
finance dept or the auditors would send me copies of the objections.
Cornwall Council should be campaigning to get out of these loans. It
should not be covering them up.
This matter was discussed at 2nd September’s Audit committee but minuted
as if it was almost a good news story. It was also discussed at Full
Council on 21 February but minuted as if it was no big deal. That is
not what Channel 4 thought.
This is head in your hands stuff.
I look forward to hearing from you.