Tempers flare as Honiton mayor and former councillor clash over damning audit report
PUBLISHED: 21:05 09 April 2018 | UPDATED: 09:29 12 April 2018
Honiton's mayor has clashed with the council's former responsible finance officer over a damning report which revealed a number of 'serious failings in governance and procedures' at the authority.
A fiery exchange between Councillor John Zarczynski and David Perkins erupted tonight (Monday) after Mr Perkins accused Cllr Zarczynski of being ‘in denial’ over the criticism directed at the authority in the Public Interest Report, published by auditor Grant Thornton.
At tonight’s council meeting, Mr Perkins said Mr Zarczynski seemed to ‘underestimate’ the importance of the auditor’s stinging public interest report, which relates to the council’s accounts for the year ending March 31, 2017.
However, Cllr Zarczynski said the council had not hidden anything and was addressing the issues which were identified in the report.
It was also revealed in the exchange that Mr Perkins wrote a letter of complaint to Grant Thornton alleging inaccuracies in the accounting statements.
This caused the cost of the report to rocket to more than £6,000 instead of roughly £1,500 due to the complaint being investigated.
Addressing Mr Perkins, Cllr Zarczynski said: “This council was very transparent when it gave its account to the external auditors.
“You decided that we were all wrong and you were right, so you wrote to Grant Thornton. They had to investigate your complaint.
“As a result, this council wasted £5,100 of public money.”
Cllr Zarczynski said there was ‘no substance’ to Mr Perkins’ complaint, and the recommendations made to the council by Grant Thornton have been disclosed to the public.
He added: “I will not now go into it any more, because I am not going to waste this council’s time going round in circles because you insist Mr Perkins, that you are right and everybody else is wrong.”
Mr Perkins, who demanded a right of reply, shot back at Cllr Zarczynski, telling him he underestimated the seriousness of a Public Interest Report.
He said: “I had correspondence backwards and forwards with Grant Thornton as they asked questions of this council.
“Many of the questions that were answered by the council were totally incorrect.
“I had to put Grant Thornton straight and give them the evidence.”
Mr Perkins told the meeting the council’s accounts were understated by £35,000 and it did not demonstrate good governance and financial control.
He added: “You seem to think this is not particularly serious – I think members of the public do think it’s serious and it’s time this council gets its act together and its house in order.”
An increasingly irate Cllr Zarczynski told the meeting the council had got its act together and was addressing numerous issues.
The heated exchange came after a report by Grant Thornton, which was appointed by the Audit Commission as auditor of the town council, found that authority’s financial systems had not been updated between November 2016 and March 2017.
It also found only the clerk had the login details of a new finance system which was introduced in June 2016.
Furthermore, the report noted that at the point of the review, there had not been any bank reconciliations completed since September 2016. This, the report said, was due to the financial system not being kept up to date.
Other key findings revealed reserve levels was not being reported to the council, no financial information had been provided to the council for scrutiny since October 2016, and insufficient information was provided on its assets and liabilities.
The report made several recommendations to the council, one of which was that the authority ‘should review and update its Financial Regulations urgently and ensure they are being reviewed regularly by full council’.
Town council clerk Mark Tredwin said: ““The town council has been aware of many of the findings that the external auditor has brought up in their Public Interest Report.
“This report covers the financial year from April 1, 2016 to March 31, 2017 when the council was experiencing significant issues in a number of key areas.
“From April 2017 there have been significant changes within the current council and major steps were being taken to address the issues that this council had identified even before the report was issued.
“With the addition of new officers to the council, additional aspects have been identified and are being addressed over the coming months.
“It is not possible to wave a wand and make some of the issues disappear overnight but there is a very clear mandate to ensure that the issues are put behind the council so that the good work such as defibrillators, allotments, grants to support local organisations, continues.”