PracticeAuditRed flag challenged by LDA

Red flag challenged by LDA

Body dubbed ‘Ken’s Piggy Bank’ refutes claims that grants are not properly accounted for

The London Development Agency has taken issue with suggestions that the
accounting for its handouts is not up to scratch.

The body is facing criticism that its grants have not been properly accounted
for. Companies receiving money from the agency have not filed accounts and there
is little trace of how the money has been spent, some have alleged.

The body was dubbed Ken’s Piggy Bank in a scathing documentary this week by
Channel 4’s Dispatches programme.

A Deloitte report, commissioned by the Greater London Authority, is said to
have red-flagged flaws in the body’s processes.

But a spokesperson for the LDA said: ‘[The GLA] asked us for information on
six of our projects and they found gaps. Instead of asking us to fill in the
gaps they’ve spent £15,000 on Deloitte, who said that its study was “subjective”
and “written in general terms so that it cannot be relied upon to cover specific
situations”. We have a very different view of what the problems in our
organisation are,’ he said.

‘These old processes are no longer used by the London Development Agency.
Indeed, all but one of the six projects were initiated before our project
guidance issued in 2005 and some of them even pre-date the creation of the LDA
itself,’ he added.

The LDA had to respond to the criticisms by Tuesday of this week.

The LDA said: ‘We believe our accounting processes are up to scratch. We are
annually audited by the Audit Commission who say we are performing well.’

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