Publication of the independent review into how Woking Borough Council (WBC) collapsed into effective bankruptcy, was delayed due to the Government calling the General Election.

Grant Thornton work will restart from July 8 when it begins further “consultation” into the draft report.

The Local Democracy Reporting Service understands this to mean extracts will be sent to those named in the report for fact checking purposes.

Individuals will only receive sections where they are named – to maintain the draft’s wider confidentiality until publication. Those named are expected to be given four weeks to respond.

A WBC spokesperson said: “The auditor conducting the independent Value for Money review, Grant Thornton UK LLP, has confirmed a delay in publication due to the general election.

“The review considers our previous governance arrangements and processes for making effective investment decisions, how risks were assessed and managed, and how these decisions were scrutinised.

“The final report will be published when it is received by the council and the timing is dependent on Grant Thornton completing the process they are required to follow.”

Grant Thornton described WBC’s financial situation, following investment decisions taken between 2016 and 2019 under the previous administration, as “extremely serious”.

The council had an “unprecedented financial shortfall” with a “forecast negative value of the general fund at March 31 2024 estimated to be £1.4 billion –  that can not be funded from resources available to the council”.

The update read: “This deficit has been driven largely by the revaluation of some of the assets against which money was borrowed by the council and the miscalculation of the council’s necessary minimum revenue provision.

“The number and value of unsecured or under secured loans to third parties and purchases of land and other property without independent valuations have also contributed to the council’s extraordinary level of debt estimated at £2.1 billion.”

The problem was made all the more challenging to unpick because the council advanced significant loans to companies it owned. Some of these, the meeting heard, are posting losses and are unlikely to repay the loans.

An auditor said that the council had not prepared group accounts for the companies it owns for a number of years and that the structure was very complex.

Another auditor added: “We are obviously doing a deeper dive into the investments, the history piece, that is in the drafting stage. We will need to do some additional Value For Money considerations that didn’t fall into that scope, particularly around anything around the governance side of wider council business and financial sustainability.

“Due to the election, and that announcement, we have held off on our consultation on our draft report. We plan to do that after the election at the moment, we are planning to do that on Monday, July 8 and we have a four week consultation period.

“It is still very much a draft where we take on board those consultation comments and hope to finalise that later. But our timetable has been pushed back with the election announcement.”