Review finds some Nottinghamshire Council members failed to declare work as company directors

A review of Nottinghamshire County Council’s accounts has found some members had failed to declare outside interests as directors of other organisations.
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Local government auditor Grant Thornton has published a report detailing its review of the Conservative-run council’s accounts for 2022 to 2023.

The auditor says it found 10 instances of ‘incomplete declarations of interest’ by members.

The names of the members involved were not made public, and it is not clear if the list relates to 10 individuals or multiple instances across a smaller group.

Several council members have failed to declare outside work as directors. Photo: OtherSeveral council members have failed to declare outside work as directors. Photo: Other
Several council members have failed to declare outside work as directors. Photo: Other

Similar problems were found during an audit back in 2021 to 2022 and Grant Thornton has carried its recommendation forward saying the authority should strengthen its declaration of interests process.

During a council governance and ethics committee meeting on February 28, Grant Thornton’s key audit partner, Andrew Smith, said: “One of the checks we do is go through Companies House to look for any directorships held by both officers and members and we compare that to the interests declared in the register of interests.

“If we do identify some directorships that have not been declared then we report that back to you.

"So yes, there are some directorships that have not been declared.”

National rules require councils to adopt a code of conduct for its members and keep and publish a register of members’ interests.

Holders of public office must also avoid placing themselves under any obligation to people or organisations that might try inappropriately to influence them in their work.

Another representative for Grant Thornton added: “There is an issue with related party disclosures.

“There are weaknesses here that do need to be addressed. We have found for a couple of years now that there are company interests councillors have that are not being declared.

“So when finance come to pull together the related parties known in the accounts, they are not aware of those interests. We find them through Companies House checks, so there are improvements to be made in the declaration of interests process.”

During the meeting councillors were told democratic services are aware and have been chasing colleagues for their declarations.

The auditor further found the finance team had not done a full interrogation of the ledger for transactions made by related parties.

Specifically, Grant Thornton says management had not searched for transactions where the related party was a customer of the council, and they had only considered where a supplier relationship existed.

Further searches took place and the auditor noted a transaction to be disclosed in the accounts, relating to the write-off of a £130,000 loan made to a charitable trust which had entered liquidation, where a member of the council sat as the trust chairman.

Grant Thornton says the sum is ‘material’, meaning it is significant.

This significance means the related party should have disclosed it.

Council members involved are not known as it was decided the name of the member and charity was not to be made public during the meeting.

Nottinghamshire Council has been contacted for further comment.

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