Press Report : Inquiry into MG Rover collapse still rolling on
Nick Huber, Accountancy Age, 27th November, 2008
Three and a half years after the government announced an inquiry into MG Rover, there is still no final report. It is estimated to have cost more than £12m, including tens of thousands of pounds on food and drink expenses and around £100,000 spent on hotels. But, three and a half years after the government announced an inquiry into the collapse of UK car giant MG Rover, a final report is still not thought to be imminent.
The inquiry, which was set up by the former Department of Trade and Industry, is being led by Gervase MacGregor, forensic accounting partner at BDO Stoy Hayward, the top ten accounting firm and Guy Newey QC of Maitland Chambers. The collapse of the car maker in 2005, with the loss of more than 6,000 jobs, has also raised accounting issues. The Accountancy Investigation and Discipline Board, is investigating the conduct of Rover’s auditor and adviser, Deloitte.
Last week the inquiry took a fresh twist after a newspaper reported that former bosses at the car giant had stalled publication of the government report into their conduct. The Times said the investigation was ready to conclude a few months ago. However, the four men who ran Rover for five years before it collapsed, John Towers, the chairman of Phoenix Venture Holdings and directors Nick Stephenson, John Edwards and Peter Beale, argued government ministers and civil servants should shoulder some of the blame and had persuaded investigators to question more witnesses, the newspaper reported.
A spokesman for the Phoenix Four denied the directors had recently lobbied the Rover inquiry to delay its report and interview new witnesses within the Department for Business, Enterprise & Regulatory Reform formerly the DTI but admitted it had raised this point a couple of years ago. He added: ‘One assumes the report will be published sometime in the middle of next year. [MG Rover] only lasted about five years and the further the report is from the event the less relevant it becomes.’
BDO declined to comment. A spokeswoman for The Insolvency Service, which is part of the Department for Business, said: ‘The independent inquiry into Rover is ongoing and The Insolvency Service does not comment on live investigations or speculate on when the inquiry will conclude. The inspectors are working to conclude their inspection as quickly as possible, subject to the need to be thorough and fair.’
The AIDB, part of the Financial Reporting Council, began its audit of Rover’s 2003 accounts and provision of other services in 2005, at the request of the then Secretary of State for Trade and Industry, Patricia Hewitt. When the AIDB investigation was announced Deloitte said it was disappointed but confident of the result of the probe.
[Source: Accountancy Age]