Despite the almost collapse of the Royal Bank of Scotland, due to the bad decision making by the board and its advisers, Deloitte, the auditor to the RBS has received £58.8million, a rise of £27.4million on the previous year …
Sounds a bit odd, yes ? Auditors of a collapsed bank receiving a massive hike in fees while the British taxpayer is forced to bail out the bank ? (yes, very odd … money for old rope & a banking failure ? – Ed)
The Herald reports :
Ian McConnell and Michael Settle
THE auditor of Royal Bank of Scotland received a £27.4m hike in its fees in the year in which the UK taxpayer had to rescue the Edinburgh institution from collapse.
The jump in fees paid by Royal to accountancy firm Deloitte, from £31.4m in 2007 to £58.8m last year, was revealed with publication of the bank's annual report yesterday.
The annual report also shows that Deloitte, which signed off RBS's 2008 accounts as giving a "true and fair view" and did not qualify its audit opinion in any way, will be proposed for reappointment as auditor at the bank's annual shareholder meeting on April 3.
Deloitte's fees for auditing RBS more than doubled from £17m to £38.6m, with this hike reflecting the accountancy firm adding to its audit work the parts of ABN Amro acquired by the Scottish bank in an ill-fated bid in 2007. Deloitte received additional fees of £20.1m from Royal for other services - up 41.5% on 2007.
In their report on the accounts, Royal's directors justify the preparation of the bank's accounts on a going-concern basis by setting out their "reasonable expectation...that the group...will continue in operational existence for the foreseeable future". They cite the government's backing.
The government took a 57.9% stake in RBS last year, and this is poised to rise to about 70.4% with the conversion of Preference stock into Ordinary shares.
The transfer value of former Royal chief executive Sir Fred Goodwin's pension pot nearly doubled from £8.37m to £16.63m during 2008 alone because of the bank's decision to let him retire at 50 on an undiscounted pension.
Goodwin's pension of £703,000-a-year has incurred the wrath of the public.
Last night, RBS faced another row when its 2008 report confirmed that ex-director Larry Fish retired from the bank on a £1.6m annual pension - the biggest received by a company employee in UK corporate history.
Mr Fish, 64, who stepped down last April after being the head of the bank's US operation, saw his pension pot rise from £17.5m in 2007 to £19.6m in 2008.
The report also confirmed that Johnny Cameron, who retired from Royal two weeks ago, saw his pension pot rise from £931,000 to £1.4m.