Auditors’ eyes ‘wide shut’ over Kids Company

MPs have accused partners from PKF Littlejohn and Kingston Smith of operating with ‘their eyes wide shut’ in their audits of the failed charity Kids Company, saying their ‘tactical’ approach meant taxpayers’ money was put at risk and they overlooked clear signs of financial problems which should have been highlighted to government. Pat Sweet reports on the Public Administration and Constitutional Affairs (PACA) committee hearing

The comments were made during a three-hour evidence session of the Public Administration and Constitutional Affairs (PACA) committee, which is conducting a short inquiry into Whitehall’s relationship with Kids Company after the charity was declared insolvent on 5 August following the withdrawal of a £3m Cabinet Office grant made days before. 

Before the PACA questioned the two accounting firms - PKF Littlejohn and Kingston Smith - who were responsible for audits of the now defunct charity, the MPs called up Big Four firm PwC, which had been commissioned in the days running up to the demise of Kids Company to investigate a number of outstanding allegations.

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