‘I don’t want to be a finance director again any time soon.’
With those words, Barclays
finance director Naguib Kheraj left the bank last week. But it is not only his
distaste for being a top FD that is grabbing the headlines; it is also his
Chris Lucas is the company’s former auditor, reopening questions about
whether it is is appropriate for companies to employ those who used to be
responsible for checking the numbers.
Kheraj told Accountancy Age last year of his dislike of much of the
regulation that banks had to meet, disclosing, apart from anything else, that
IFRS conversion had cost the bank £50m.
But his departure was still unexpected, especially as he has not yet
announced a new role.
Kheraj will still be FD for more than five months before
PricewaterhouseCoopers’ Lucas assumes the mantle of financial responsibility at
the UK’s third largest bank.
What’s going to happen
Lucas is currently UK head of Financial Services and global head of banking
and capital markets at PwC.
He is due to begin on 1 April, the start of Barclays’ financial year, and his
progress is sure to be the subject of meticulous scrutiny.
Lucas has been with PwC for 23 years, holding some prominent posts in the
financial services arena in particular, where he has specialised.
He was PwC’s global relationship partner for Barclays between 1999 and 2004
and has worked across financial services accounting for most of his career,
including three years in New York as head of the PwC’s US Banking Audit
His experience could come in handy if one of the big US banks comes knocking
with a bid offer for Barclays, a repeated rumour.
A more major concern for Lucas is the difficult issue of whether auditors
should take on FD roles at companies they have been responsible for scrutinis
The fear must be that auditors could be reluctant to criticise companies on
the basis that they will be looking for a finance director some time soon.
Lucas has observed the requisite buffer period between last signing off on
Barclays accounts in 2004 and taking up his new role. The bank also insisted,
with some justification, that there are few people who know its finances inside
out, and who could take on the job.
Auditors certainly are in that position, but if the appointment indicates a
growing trend, the nation’s corporate governance experts could find themselves a
closer look at this area.
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