Council chiefs face accounts hearing

Hundreds of errors were found in the council's accounts

Senior officials at Inverclyde Council have been questioned about financial mismanagement after a major investigation into the local authority's accounts.

They were cross-examined at a public hearing by members of the Accounts Commission Scotland.

Wednesday's hearing follows two reports criticising the way the council's finances have been handled in recent years

Chief executive Robert Cleary has admitted that there have been difficulties, but insists the situation is being sorted out.

Professor Percy: "Accounts concern"

The main investigation by the Accounts Commission was carried out into the accounts for 1997-98.

They were more than a year late and needed more than 2,000 corrections.

When the alterations were made, the original accounts were found to be £49m down in valuation.

The council was accused of not knowing what it was worth, what was in its bank accounts and who owed it money.

Five out of seven direct labour organisations in Inverclyde were found to be almost bankrupt.

Professor Ian Percy, of the accounts commission, said: "The position with Inverclyde is that they have been much slower in getting up to scratch.

'Financial problems'

"We don't believe that they've got the proper resources in place to run an authority that is in the interests of the citizens.

"If an individual at home is working on bank statements, doesn't reconcile the bank statements, doesn't know what the money is being spent on on a regular basis, the risk is that they will get into financial problems.

"What we want to ensure is that Inverclyde do not get into financial difficulties."

Mr Cleary said: "I wouldn't agree that it was a shambles.

"Certainly there are a number of serious issues which the accounts commission have identified via their external auditors - a number of which the council itself had already recognised and had started to take action to address."

"I think the accounts presented for 99/2000 will show considerable improvement in terms of what's happened and an action plan to affect further improvements before the end of the year."