A blog in defence of all us "small" auditors out here
A bit smug
I have been agonising for over a year now, as one of my team pointed out, over whether or not to make a formal complaint about a company set of accounts to Companies House. And if you are wondering why to Companies House – who else is there – this is a small company, nobody else cares (except possibly the creditors who could lose money). And no, this is not a client, but I obtained a copy of the accounts because they owed my client money, a lot of it in fact, and I wanted to know if they were ever going to be able to pay it.
Then I read the article about the Lehman Brothers and the criticism of the auditors for, and I quote “serious lapses”, and I thought to myself, rather smugly if I am honest, that it could never be me. But it got me thinking………. the problems don’t just disappear as the scale gets smaller, and responsibility for consequences isn’t confined to clients own reports.
I have since looked at several years accounts, and they are shocking – prepared by the accountant who is also a main director and shareholder. His name is deliberately removed from the accounts submitted to Companies House – the accountants report is not signed. But the accountants address is on the accounts and it is the address of his practice - he is a qualified CA. I couldn’t explain all the things wrong with these accounts, but the only factual basis for a complaint would be that based on the balance sheet, this set of accounts should have been audited.
So why do I hesitate – because I know that if Companies House insists on an audit, and an independent auditor does his job properly, there is a strong possibility, near certainty, that the company will go down- a lot of people will lose their jobs, an area which is starved of investment and employment will be much worse off.
So… do I make the complaint based on my “principles”, and disgust that a qualified CA could ever produce such a disgraceful set of twisted accounts potentially bringing my profession into disrepute……..…. Or do I keep quiet – after all its not my responsibility. What would you do?