You, like me, may have been less than impressed by Philip Hammond as he stood at the dispatch box cracking bad jokes while announcing that the nation would graciously provide some extremely worthy causes and others rather more questionable with relatively insignificant allocations of government funds.
While £10m would be a significant boost to my bank balance and probably that of most accountants, in a Budget where billions and even trillions get frittered away or at least mentioned in passing, such sums represent a barely noticeable drop in the ocean.
The lack of magnitude of such apparent largess became much clearer thanks to a Freedom of Information request from the Unite trade union. This yielded the scandalous news that a far larger sum, estimated to be £150m, has gone to a cause that most of us might regard as considerably less worthy than a local charity or group of underprivileged individuals.
The demise of the construction company Carillion hit the headlines and must undoubtedly have been devastating for those involved at the sharp end, particularly employees who found themselves unemployed either directly or as a result of working for a supplier, which may, in turn, have bitten the dust or been obliged to cut costs in a desperate effort to survive after losing a major client.
Apparently though, the problem stretches much wider. It seems that every taxpayer is going to have to make a contribution to this loss since there is no one else to pick up the tab.
The analysis is chilling. While not far short of half of the estimated black hole is going to meet staff and redundancy payments there are £20m of other closure costs. However, on the plus side for the industry, the largest single figure of all – something like £70m – has been set aside to pay the fees of lawyers and members of our profession for their invaluable services as liquidators and advisers.
All of that having been said, there is another question that I had expected somebody to ask by now. Why should the country and its hard-working taxpayers be expected to pick up the tab if, as has been suggested in the media, there have been significant failures by the auditors and possibly other professional advisers which led directly or indirectly to the collapse of the group or, at the very least, increased the losses ultimately suffered?
If that really is the case, then the government’s internal equivalents to an insolvency team should be able to present a strong, reasoned argument for the nation to claim recompense on behalf of taxpayers from those who are culpable for any element of the loss.
I, therefore, wonder whether the Attorney General, the Chancellor of the Exchequer or perhaps some anti-capitalist MP from the left edge of the Labour Party might eventually come to the same conclusion and seek action.
If so, we might expect one of them to stand up in Parliament before too long with a demand that the authorities take appropriate steps, presumably largely directing their ire towards one or more members of the Big Four, politely suggesting that they might wish to stump up some or all of the £150m shortfall.
If they do, this might be the sharp end of a very large wedge that could have a major impact on the profession for years to come.
There is also a lesson here for us all. I would politely suggest that every accountant should take even greater care to ensure that his or her firm could never end up in the frame for direct attacks by liquidators seeking compensation for failures to get the basics right.
About The Imprudent Accountant
Someone who should know better, but can't resist the occasional rant about the more exasperating aspects of the accountancy profession.