Government to fund examination of Walton directors
THE Queensland Building Services Authority relied on outdated financial information when it registered disgraced construction boss Craig Walton as the nominated builder for Peloton Builders which took over most Walton (Qld) projects when that company went into administration on October 3.
The Queensland Government has committed to fund a full public examination of Walton directors and those of the Mawson Group who set up Peloton in early August ahead of Walton ultimately going into liquidation with debts totalling $49m.
Sub contractors working on the $21m Nambour Coles' project completed late September are owed nearly $3.9m.
A spokesman for Housing Minister Tim Mander said at the time Walton Construction sole director Craig Walton was licensed by the QBSA he was also the director of Walton Construction (QLD) Pty Ltd and was not an excluded, banned or disqualified individual.
"Walton Construction (QLD) Pty Ltd was due to provide its audited financial statements to the BSA to satisfy licence renewal requirements by 31 October 2013,'' he said.
"The BSA received confirmation from the company's auditors on 4 September 2013 that the financial results for the year ended 30 June 2013 would be audited and provided to the BSA for the company's licence renewal.
"Walton Construction was placed into administration on 3 October 2013. On 4 October 2013, as a result of the appointment of administrators the BSA issued exclusion notices to Walton Construction (QLD) Pty Ltd and the director, Craig Walton.
"Mr Walton's Builder-Open Nominee Supervisor licence was subsequently cancelled and he is now categorised as an excluded individual."
Creditors have been told by liquidator Lawler Draper Dillon that the Walton Group was effectively trading while insolvent from July1, 2012 and possibly earlier.
The NAB certainly knew the company was in serious trouble as early as February this year when it withdrew guarantees for Walton projects and referred Mr Walton to a number of business advisory firms including the Mawson Group.
And the company's 2012 financial audit, submitted to ASIC on December 19, 2012, should have rung alarm bells.
That document showed a 12-month loss of more than $14m and was heavily qualified.
However on the basis of that document the QBSA renewed the licence.
The confirmation Mr Mander says was received in September this year from Walton auditors that financial results for 2013 would be provided, was in fact a request for extension of the time to do so.
Mr Walton paid the licence renewal fee by the September 30 deadline for his licence renewal but the extension granted until October 31 to provide the audited accounts was never met.
Walton Construction and Walton Qld went into administration on October 3.
If the 2012 financial audit did not ring alarm bells they should have been loud and clear by April this year when the then auditor GMK Partners in a Part Two financial report also raised questions about Walton's viability as a going concern, highlighting unaudited management accounts for the eight months from July 1, 2012 to February 28, 2013, that showed a loss of nearly $7m.
Sub-contractors working on the Nambour Coles' project were left uninformed of the construction company's woes and kept doing work and incurring debt for materials for which they were never going to be paid.
The Minister's spokesman said Mr Walton is now barred from holding a builder's licence in his own right and can not be a director, secretary, or influential person, as that term is defined in the QBCC Act, of a QBCC-licensed company.