PracticeAuditAudit failure? Don’t blame us

Audit failure? Don't blame us

Comment from Accountancy Age

‘The overwhelming majority of audits conducted by the major accounting firms
are highly professional, effective and valuable,’ according to the new website,
Valueyouraudit.com.

‘However, commentary in the media tends to focus on the few, high profile
audit failures, rather than the huge number of successful audits.’

The PricewaterhouseCoopers-backed campaign has merit, though we take issue
with that last statement. As ‘the media’ we’re bound to.

The audit statement itself is so bland as to be meaningless. And with the
demands of client confidentiality (a real need, though some firms sometimes hide
behind it to avoid discussing things that are far from confidential) there is
very little to focus on but those failures.

The failures themselves may be few in number, but they are often spectacular
enough to justify the attention they get.

This week an intrepid Accountancy Age visited London Bridge station to test
public reaction to the Valueyouraudit billboard ad currently plastered above the
station concourse. Reaction was muted, to say the least, varying from ‘I don’t
know what that means’ to a ‘waste of money’.

There will be some who feel differently, of course. However after 40 minutes
of trying to find them, in true journalistic style, our reporter made his
excuses and left.

A game of two halves

It was, it has to be said, a victory snatched from the jaws of defeat.

The football business has been through the mill over the last few seasons and
if any club symbolised the way that many clubs gambled on success and failed it
has to be Leeds United.

The club reached the final stages of the Champions League in 2001 and
invested heavily. But the sums only added up if success on the field followed.
It didn’t, the team was relegated from the Premiership three years later and
club slid into administration.

Last week the club’s administrator – Ernst & Young partner Garry Wilson –
repaid the last of Leeds’ creditors. Using £500,000 secured at the time of the
administration, Wilson repaid 30 to 40 small creditors included catering
companies, former employees and consultants. Even the milkman got his money
back.

That might not be the end of the story. Co-administrator Brendan Guilfoyle of
the P&A Partnership has submitted a report to the DTI on the conduct of
former club directors.

Put that to one side for a moment, however. And if Leeds’ fall from grace
kicked off a series of financial disasters that has bedevilled football for the
last five years, everyone involved in the sport will be hoping that its recovery
triggers (financial) success stories elsewhere.

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