Former QMH accountant banned

The former auditor of hotel group Queens Moat Houses (QMH) has been expelled from the Institute of Chartered Accountants and ordered to pay costs of £50,000 for failing to spot "inappropriate" accounting policies that led to the hotel group's profits being inflated by some £19m in 1990. Maurice Hart was a partner in accountants Bird Luckin, and later a non-executive director of QMH. Accountancy watchdog the Joint Disciplinary Scheme (JDS) said Hart's conduct of the 1990 audit "lacked the objectivity, professional competence, skill and care required of a chartered accountant". In April 1991, QMH reported that its profit for 1990 was £94.1m. In fact, most of the profit was not from normal trading activities but "derived from inappropriate accounting policies". These included a deal with some individual hotel managers that they would run their hotels through separate companies, pay an annual fee to QMH, and in return keep any profits. The whole of the fees paid were taken as profits for the year to 31 December 1990. Hart retired from Bird Luckin in 1991 and became a non-executive director of QMH. Similar accounting practices were used in 1991 to create profits of £90.4m. Hart failed to review accounting controls, the watchdog said. After the problems came to light, shares in QMH were suspended in March 1993 and Hart resigned his directorship in May 1993. QMH shares were re-listed on the stock exchange in 1995 after a financial restructuring of the company. Web linkJoint Disciplinary Scheme report