HC Deb 30 October 1906 vol 163 cc865-6
Dn. MACNAMARA (Camberwell, N.)

To ask the President of the Board of Trade if he can state what procedure he adopts with reference to the appointment of an auditor to an electric lighting company in London; if the Department have made any regulations with reference to such audit, and, if so, what; whether applications have been received from any local authorites in London, supported by the London County Council, asking to be allowed to attend before the auditor appointed in respect of any company; if so, whether such application has been refused by the Board of Trade, and, if so, for what reason; whether such auditor is paid directly by the company whose accounts he audits; whether such auditor has the power to disallow or to take exception in any effective manner to any charges in the accounts or to any other entries (e.g., an allocation as between capital and revenue); if he can state whether any effective action of this character has been taken by any auditor acting for a London company; whether any public notice of the audit is given or similar steps taken to those followed by the audition of an electricity undertaking owned by a London local authority; and whether he is prepared to make regulations for such audit in order that duly appointed representatives of any local authorities may be able to attend the audit of companies' electricity accounts in their area, and be placed in a similar position to ratepayers at a municipal audit.

(Answered by Mr. Lloyd-George.) The appointment by the Board of Trade of auditors of the accounts of electric lighting companies in London is made in pursuance of provisions inserted in the various companies' orders and is made annually. The Department have not yet made any regulations with reference to the audit. An application has been made by the Camberwell local authority to be allowed to attend before the auditor, and is now under consideration by the Department. No other application has been made by a metropolitan local authority. The auditor's fee is paid by the company to the Board of Trade, and by them to the auditor. Under the general form of andit clause the auditor has no power to disallow charges, but, in the event of his requirements not being complied with by the company, he reports the matter-to the Board of Trade, and any Report made by the auditor, or such portion thereof as the Board of Trade direct, is required to be appended to the company's annual statement of accounts, and forms part thereof for the purposes of statutory publication. Generally the requirements of the auditor are met by the company, but, in any case where they are not met, it is the practice of the Department to communicate to the London County Council and the local authority, the bodies concerned in the questions of revision of prices and purchase of the undertaking, a copy of the accounts, and of the auditor's Report, and of any correspondence relating thereto. The accounts not being those of a local authority, public notice of the audit is not given. I am considering the question of making arrangements for representatives of the Camberwell local authority to have facilities to discuss with the auditors of the accounts of companies having powers in Camberwell any questions which may arise on those accounts, and, if satisfactory arrangements cannot be made, I am prepared to consider the question of making regulations in the matter.