THE country’s chief financial watchdog has apologised to West Dunbartonshire Council for a mistake that has cost them nearly £2million.

Council bosses had worked with Audit Scotland to restructure loans as part of an effort to balance their books in February.

It allowed them to close the budget gap without the usual annual service cuts - and improved the situation for coming years, prior to the pandemic.

But Audit Scotland then realised they were telling other local authorities something else and went back to West Dunbartonshire Council (WDC) in June to correct their mistake.

Though it is a change in terminology and accounting, it still reduces cash available to the council by £1.9m.

Since the budget was passed, the council has lost millions in revenue and had to spend several million more to meet the community’s needs during the pandemic lockdown.

At the WDC meeting last week - the first full council meeting since before lockdown - Audit Scotland told councillors that a portion of their debt efforts should be treated as a “change in accounting policy”.

The accounting agency had agreed the plan with council officers in February, then discovered that they treated other councils differently.

Councillors asked how Audit Scotland could get their advice “so wrong”.

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WDC’s chief finance officer said the advice given to them was “miscommunication when we asked the question” and added: “That was unfortunate.”

Richard Smith, from Audit Scotland, told the meeting: “All I can do is apologise it is so late in clarifying the position, but that’s where we are.”

Councillor Diane Docherty asked: “Have we sent a complaint to the auditors, and can we? I think it’s a very serious issue.”

But council chief executive Joyce White said there had been a letter from Audit Scotland on June 17.

She said: “We did have a very thorough discussion and I felt it was important we had some record of the situation. My view was there was no requirement to further progress this.”

Councillor Jim Bollan said: “This is another piece of shoddy work from Audit Scotland. I hope they bring changes so other local authorities don’t fall into the same trap.”

In a statement after the meeting, a spokeswoman for the council said: “The sum formed part of the reserves which were used as part of this year’s budget.

“Originally the auditors agreed with the council’s planned accounting treatment which would have generated a revenue reserve from the loans fund review.

“Updated advice is that this should be accounted for in a different way and therefore the resulting revenue reserve is no longer available and impacts on our previously agreed 2020/21 budget by £1.9m.”