Held to account
With the dust still settling on the collapsed London & Edinburgh Swallow Group (L&ES), I rang the Institute of Chartered Accountants of England & Wales to ask if the beancounters' trade body had received any complaints about BDO Stoy Hayward, the failed pub group's auditors.
A spokesman for the institute had a rummage around and eventually replied that it hadn't. Which is fair enough, although there may be people out there who are minded to do so in the future. For now though, nothing.
But when a business like this goes under one wonders "where were the safeguards?"
When I put former employees' concerns regarding L&ES' financial health to ex-chairman Alan Bowes he suggested that I "consult Companies House for copies of the audited accounts" which would "show the true position of the companies".
If I'd been an L&ES supplier or a pub manager and I'd lost money or even my home following the group's demise, I might well question the point of compiling and filing audited company accounts.
I'm not suggesting anything untoward was going on when BDO signed off the accounts. Still, the company fell apart and stakeholders are left wondering what happened and whether they will be compensated.
Perhaps instead of periodic, static statements about a company's performance, investors would be better served by real-time, internet-based accounting methods, as is being suggested in certain quarters.
This would still require absolute trust between auditor and shareholder, but might better signal potential financial problems.
- Shares in Wolverhampton & Dudley Breweries and Greene King have surged in recent weeks as investors digested the news - sorry, the speculation - that the two super-regionals are thinking of merging. Many City types I talk to suggest a tie-up between the two companies is ultimately inevitable, but hey, they would say that, wouldn't they? The companies themselves refrain from commenting, while we sit back and wonder wistfully who would run the combined entity, if such a thing came to pass...
