The Chairman and his motley committee is now under attack from “Credit & Investigations Services LLP”. They have engaged with the Auditors of the Lakeview accounts. They raise serious questions with the accounts and the quality of the Audit work.
The pressure is mounting as TATOC CEO becomes embroiled in justifications and in respect to the resorts financial transaction. This investigation is on top of the investigation under crime number NFRC150401024188 and the hostility shown by the Lakeview Country Club Landlord. Needless to say the resorts swells with troubles as the two camps scrap it out. When the TCA announced that tanks are on the edge of the resorts and the barrels where pointing straight at Harry Taylor we were right and now both barrels have been loaded and are heading TATOC way.
If you want to sell your Lakeview timeshare resorts you can do just that, as the landlord is buying them up, in some cases paying £1,000.00. “Hell hath no fury than a landlord who believes that things are not right”.
The letters are detailed below:-
—————————————————————————————————————
Letter Informing Timeshare Consumers on Lakeview Forum
by Paul Sayers » Mon Aug 24, 2015 11:30 am
Dear Members,
I am writing to you through this forum, to communicate with those members who attended the AGM and who would have heard the points I and other members raised about the accounts. I attended the meeting on behalf of a Timeshare Owner who is a member of the club.
As asked to do so by your Chairman I raised the questions he failed to answer with the auditors. It seems he has now instructed them not to respond and answer the questions.
I enclose my letter to the auditors.
I am asking for your support in requisitioning an EGM to consider the resolutions as drafted below. This requires 10% of the members but there is no information available from the committee as to how many members there are on the register or any details which make it possible to organise the required 10% to convene a meeting and make proposals.
Regards
Paul Sayers
Partner
Credit & Investigations Services LLP
paulsayers.cis@gmail.com
- To remove Mr Taylor as a member and chairman of the committee but inviting him to re-stand for office at the next General Meeting to be held after the Police Investigation into affairs which concern him and the timeshare industry have been concluded and no charges have been brought or he is found not to be culpable of any offence by the court.2. To engage a firm of independent chartered accountants from a list of suitable firms to be provided by the Chairman of The Institute of Chartered Accountants of England and Wales. The engagement shall be to review the clubs last annual accounts as prepared and audited by Thomas Westcott and to report on the current financial position and future prospects of the club with regard to the present and future interests of the members and creditors of the club.
3. The committee shall at the earliest opportunity propose a change to the constitution to provide for the review of the register of members as maintained by the trustees at their offices in London, on the request in writing of any member and payment of a fee of £10.
LETTER TO AUDITORS:
CREDIT & INVESTIGATIONS SERVICES LLP
55 WEST CLIFF ROAD, BROADSTAIRS, KENT CT10 1PY
Telephone 01843 867968 07507833712
Paul.sayers.cis@gmail.com———————————————————————————————————————————————————————————————————
29 June 2015
Mr Stuart Carrington FCA
Thomas Westcott Chartered Accountants
Timberly
South Street
Axminster
Devon
EX13 5AD
Dear Mr Carrington
LAKEVIEW COUNTRY CLUB TIMESHARE (“THE CLUB”)
I attended the Annual General Meeting of the club on the instruction of a holder of a timeshare certificate. At the meeting questions were raised about the accounts audited by your firm, which the committee were unable to answer and members were asked to contact you for clarification. In this regard I raise the following matters for your consideration and I would appreciate your substantive response within 14 days. For your convenience, you may respond by e-mail as above or telephone me as detailed below..
1. Conflict and Independence
Your audit report is addressed to the club members on whose behalf you undertook the audit. The club is managed by a committee under the chairmanship of Mr Harry Taylor. Auditors should have a level of independence from the committee members administering the club finances and assets. The auditors have a responsibility to the members over and above the committee. It is noted from your website that you have a close continuing professional relationship with TATOC, a company limited by guarantee, controlled by Mr Taylor. There also appear to be other connections.
During the meeting Mr Taylor was asked why his own accountants were employed as auditors of the club and whether he believed his other relationships should be disclosed as a potential conflict. Mr Taylor denied conflict or the need to disclose the association prior to your appointment stating that you were appointed as auditors solely because you had acted for the prior owner, Mr Vernon.
Another club member, who was a chartered accountant, asked how you had managed to perform a full audit service and prepare the accounts for a fee of £1,790.an increase of only £245 over the previous year where there was no audit. The members were informed you carried out the work for this fee as a favour.
It is understood there is a live police investigation into the conduct of Mr Taylor in association Aroma Thyme Limited and Associates led by Mr Lamont (reference NFRC150401024188). This complaint relates to a situation which was live at the date when you were working on your audit. The dispute concerns dealings with members of the club by Aroma through the Committee. Aroma is an associate of Continental Trust Limited with offices at the same address in London and seems to have close associations with Mr Taylor.
Registered in England No CO378206
—————————————————————————————————————
Mr Stuart Carrington FCA – Page 2 – 29 June 2015
It would be greatly appreciated if you could confirm:-
i. You have no conflict of interest which should be reported to members and will you continue to act as auditors.
ii. Details of the scope of work carried out in preparing the accounts and issuing the audit statement laid before the members at the Annual General Meeting;
iii Did you act for the previous Landlord Mr Vernon or any associate, how long for and in what capacity .
iii. Were you made aware of the complaint and the dealings between the committee and Aroma and did you consider the independence and impartiality of Continental as the trustees holding and administrating the members interests in the time share property and certificates. If not previously aware will you now investigate further and report to the members.
iv How do you justify your charges other than by confirming, minimal work was undertaken and are you prepared to allow inspection of your audit files by a member of the club who is also a member of your institute.
v Would you be prepared to review your work and issue a new report.
2. Disputes and Verification
There are long standing disputes between the club and the two previous landlords dating back many years. The disputes continue from the time of Mr Vernon, with whom it appears you had a professional relationship and should therefore have been aware of the position. The disputes relate to unpaid charges due to both the former landlord and the current landlord who has acquired the claims of Mr Vernon; time share weeks that are claimed to have reverted to the landlord: where the committee claims to have issued time share certificates to the current landlord to discharge costs outstanding and others.
I contacted the landlord who advised me that they never received any communications from you during the process of preparing the audited accounts. They allege you never attempted to obtain verification on charges raised whether paid or outstanding. At no time have you question with them the validity of their charges or otherwise.
Whilst you are not be expected to make determinations on disputes, as auditor is was your duty to confirm the amounts paid were properly due and to confirm the balance outstanding. Without this procedure the accounts produced and the audit certificate are vacuous. The same is true of debts due to the company. If there were doubts or disputes they need to be disclosed and you must have been required to investigate the existence of such before reporting. (All for £245). This procedure is the very reason the club employs an independent auditor rather than rely on accounts produced by the committee. In regard to the work you carried out in issuing the audit certificate can you please advise:-
i. What verifications you carried out to confirm the creditor and debtor figure in the accounts was correct;
ii. What information was made available to you by the committee in regard to disputes which are in solicitors hands and should by now have passed into arbitration under the terms of the leases dispute resolution clause.
Iii Did you ever suggest it was necessary for notes of any kind to be attached to the accounts laid before the members or for your audit report to be qualified.
Registered in England No CO378206
—————————————————————————————————————————————————————————————————————
Mr Stuart Carrington FCA – Page 3 – 29 June 2015
3. Correct Levy of Charges to Members
It is noted from your web site that you consider your firm to be experts in the Time Share Industry. It is therefore expected that you have expert knowledge to employ on behalf of your clients, which increase your duty of care and expectation as to the extent of the quality of the enquiries you would make.
You are hopefully aware that the club could have active members, each enjoying one week of one of the timeshare properties of about 1200. It is understood that the actual number remaining, who have not surrendered their certificate is 500/600 with circa 650 vesting with the committee for the benefit of the members. This is an asset which has not been reported on and appears to have been ignored in the accounts you audited and not even referred to in any note to those accounts.
I was very surprised that the accounts laid before the members did not contain a detailed calculation of how the management charge was calculated and also the budgets for the following year which would be the basis of levying the next charge. I fully understand that this may not have been within your instructions as auditors but it is a crucial part of any meaningful and objective report to members.
As auditor it was your duty to certify the correct costs have been charged and recovered. If there was an over or under charge it was your duty to investigate this and report. As regards the amount charged firstly as no enquiry was made by you it seems you never satisfied yourself on the costs recovered. The committee holds a copy of Counsel’s Opinion which confirms the law relating to the division of costs between time share certificate holders. As experts in time share I trust you are aware of how rechargeable costs should be recharged where there is no specific provisions in the club constitution. The constitution does not allow the committee to recover all the costs in the way it has done so for many years. This breach should have been reported on by you and fully understood by you as a result of your long exposure to Lakeview, your specialist knowledge and the investigations and enquiries you were bound to carry out. The rechargeable costs payable by members should have been the costs properly incurred divided by the number of active, being 500/600 not 1200. This creates a debt to the members which is uncalculated or reserved for, undisclosed and almost certainly makes the club insolvent.
In this regard can you please advise:-
i. What enquiries you made to Continental Trustees Limited as regard to the number of timeshare certificates still held by club members and the number that vest in the control of the committee. Did you get Continental to confirm the position in writing?
ii. How the interests of the club in certificates which have been surrendered are valued and disclosed in the accounts;
iii. Your investigations as to whether these certificates vest with the committee for the benefit of the club or whether there are any third party rights to these certificates such as the landlord as he claims.
iv. During the course of your audit it is believed you must have reviewed the constitution of the club. In this regard can advise the date of the constitution which you have reviewed.
Registered in England No CO378206
—————————————————————————————————————————————————————————————————————
Mr Stuart Carrington FCA – Page 4 – 29 June 2015
v. Have you reviewed the leases in considering the validity and accuracy accounts you audited
.vi What steps did you take to determine the charges made were correct.;
vii .Having now been made aware of the situation do you believe the past years accounts should be revisited and restated.
I apologise for the length of this letter and I am very aware of the waste of professional time and costs in dealing with matters of this kind. Regretfully in the case of the Lakeview Club some intervention is necessary and your responsibility is very formidable despite your overly modest charges. Failure to deal with these matters now will not increase any culpability for matters overlooked in the past accounts which you signed undated.
I believe you should be given every chance to deal with the matters that concern me. If these matters are not addressed there will be serious and potentially costly results for the members, the committee, the auditors and the creditors. My concerns are now increased because the committee members have decided to give all members of the club, who do not wish to continue to pay fees, the opportunity of surrendering their timeshare certificates to the committee. It is understood that large numbers of the members wish to do this. The consequence of this surrender will be a serious reduction in the number of active timeshare members to share the costs under the present cost evaluation and re-charging policies followed by the committee. This will result in even heavier charges for those continuing and resulting in even further surrenders.
The committee say this offer was made to placate members. It is possible, with some situation precedents, that there is some other undisclosed agenda such as asset stripping, which would be assisted by an increase in the size of the pool of certificates controlled by the members. Mr Taylor vigorously denied any such intention at the AGM and was believed by the meeting. I am told a further offer has since been made by an outside party to purchase time share weeks for up to £1000. This suggests to me there is some value attributable to empty weeks, being an undisclosed asset of the club. It further seems the members are being prejudiced by inadequate reporting including financial reporting.
The auditors are in the position to take stock of the current position by carrying out an independent evaluation and review of the club, free of any control by the committee or any other party other than the members and report to the members. You could do this if you have no conflict and if you have one, another medium sized firm could be engaged for the purpose. Such a review would benefit the members. You would be entitle to be properly remunerated for carrying out any such review based on instructions agreed by the member in a general meeting convened for the purpose.
If you feel my enquiries are difficult for you to provide an immediate and substantive reply, I would be very pleased to discuss the position with you as to a way forward. I look forward to hearing from you and can be contacted at any time by email or my mobile 07507833712.
Yours sincerely
Paul A Sayers
Senior Partner
For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk