Written evidence submitted by Devon &
Cornwall Business Services Limited
I watched a recorded session on BBC Parliament for
your interviews of panels which included Ted Tuppin of Enterprise
Inns. It was notable that under questioning Mr Tuppin appeared
somewhat less than forthcoming and attempted to lead the committee
off the question, which was picked up by one or two of your members.
In our dealings we come across Pubs which are Enterprise,
Punch and Admiral as well as free houses.
Of all the Pubco's, Enterprise Inns seems to be the
most unfair in the stable. To demonstrate I would like to take
issue with one of my own field's comments that Ted Tuppin used
to attempt to demonstrate Enterprise's commitment to being fair
and ask for your opinion.
Ted Tuppin stated that they insisted that all new
tenants and lessees had to have a qualified accountant to sign
off their business plan and then retain that accountant for a
period of a year. The accountants are contained on a list and
age the only ones which Enterprise allows to be used. This is
because they insist on "open book accounting" this is
where Enterprise has full access to the books and records of the
tenants. There are a number of problems:
— No
chartered Bodied Accountant (ICAEW, CIMA, ACCA, CIPFA) would automatically
release such figures to any third party which is exactly what
a Pubco is to the tenant or lessee - this is against the Data
Protection Legislation so we would require Client's written permission.
The Pubco's accountants do not.
— The
Pubco's accountants levy a monthly charge in excess of £250
a month which is a cost which many cannot afford. We for example
look at volume of paperwork, condition of profitability and work
with the client to try to improve the business.
— Many
of the accountants are far removed from the client and thus most
transactions are by post!
— Most
of the Enterprise Accountants used by most Pubco's are not members
of the Chartered Bodies of Accountants, therefore are qualified
by buying a qualification rather than by studying and working
for the qualification. HMRC are fighting against accountants like
this who have in some cases swindled the Public Finances out of
Millions of Pounds - one case in St Austell is for £1 million
on its own.
— One
Accountant originally on the Enterprise inns list actually went
into receivership.
What is amazing is that if a tenant moves site and
wants to retain their own accountant this is not allowed by Enterprise
whereas for Punch there is some flexibility, particularly if the
accountant is known to a BDM or higher.
The question is whether the committee is happy for
a Pubco like Enterprise to actually encourage unqualified accountants
to exist by handing them business levels which they could not
normally expect.
I think the committee should bring Enterprise Inns
back to ask them why in this case they are actually forsaking
a client's wellbeing so that they can look into the affairs of
their tenant and raise rents as they push the pub's business up.
My add on point here is that the Pubco's probably
are taking a commission from these accountants for the business
levels introduced to them, in my view this is wrong they should
act in the best interests of their tenants so that they keep occupancy
of their pubs consistent.
I am grateful to you for taking the time to read
this letter.
Nick Siddaway FCMA Director
11 July 2011
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