Firm which audits SNP finances has resigned

Police carried out a search of the SNP's headquarters in Edinburgh this week

The firm that audits the SNP's finances has resigned, the BBC has learned.

Accountants Johnston Carmichael, which has worked with the party for more than a decade, said the decision was taken after a review of its clients.

Police investigating the SNP's finances this week searched the home of former SNP chief executive Peter Murrell - Nicola Sturgeon's husband. He was arrested and released without charge.

The BBC understands Johnston Carmichael resigned before Mr Murrell's arrest.

A spokesperson for the SNP said it was in the process of finding a replacement firm.

• Sturgeon out of event as two-day police search ends

• Peter Murrell released without charge after arrest

Police Scotland has been investigating the SNP's finances since July 2021.

On Wednesday, Mr Murrell was arrested while dozens of officers carried out a high-profile search at his Glasgow home and SNP headquarters in Edinburgh.

Nicola Sturgeon and Peter Murrell had high profile roles in the SNP for years

Ms Sturgeon, Scotland's former first minister, was at the house when police arrived but said she had "no prior knowledge" of Police Scotland's plans.

Mr Murrell was questioned while the search took place then released without charge on Wednesday evening.

First Minister Humza Yousaf, who succeeded Ms Sturgeon last week, said his party had "fully co-operated" with police and would continue to do so.

He said that he was "very, very clear that the governance of the party was not as it should be".

Why are police investigating the SNP?

• Police Scotland launched an investigation in July 2021 after complaints about how SNP donations were used.

• The funds were donated for a new independence referendum campaign.

• The SNP raised £666,953 through referendum-related appeals between 2017 and 2020.

• Nicola Sturgeon said she was "not concerned" and "every penny" would be spent on the independence drive.

• Questions were raised after SNP accounts showed just £97,000 in the bank at the end of 2019, and total assets of about £272,000.

Mr Murrell, who has been married to Ms Sturgeon since 2010, resigned last month after taking responsibility for misleading statements about a fall in party membership.

Last year it emerged that he gave a loan of more than £100,000 to the SNP to help it out with a "cash flow" issue after the last election.

The party had repaid about half of the money by October of that year.

At the time an SNP spokesman said the loan was a "personal contribution made by the chief executive to assist with cash flow after the Holyrood election".

He said it had been reported in the party's 2021 accounts.

Weeks earlier, MP Douglas Chapman had resigned as party treasurer saying he had not been given the "financial information" to do the job.

The SNP is required to prepare financial statements in accordance with the Political Parties, Elections and Referendum Act 2000. It has until 7 July to present their accounts to the Electoral Commission.

If there is no report and no reasonable excuse, the commission has the power to appoint its own firm of auditors.

The SNP's accounts for 2021 were published on 16 August 2022.

The party's total income was £4,510,460, total expenditure was £5,262,032, assets were £1,630,454 and liabilities were £1,055,689.

Electoral Commission rules state any party with income or expenditure of more than £250,000 is required by law to also independently audit their accounts and include this report in their submission.

It's Humza Yousaf's birthday today and, in a strange coincidence, the birthday of the Scottish National Party too.

Hardly any cause for celebration for them in what must be one of the most difficult weeks in the party's 89-year long history.

The news the SNP's auditors have resigned piles yet more pressure on the organisation.

The clock is now ticking - the party has exactly three months to appoint new auditors and submit accounts to the Electoral Commission.

We heard from sources in the business community and in politics the firm had resigned - after putting this to the SNP, they confirmed it to us.

What is proving hard to discover is exactly when this happened - the SNP say they're tendering for a new auditor but we don't know how long they've been looking.

Humza Yousaf has spent the week promising to increase governance and transparency - but the party did not willingly volunteer this information.

There's been no honeymoon period in office for Humza Yousaf - and no doubt not much of a birthday celebration either.

Scottish Labour's deputy leader Jackie Baillie said the resignation of Johnstone Carmichael was a deeply worrying development that posed "serious questions" about the SNP's financial affairs.

She said: "Yesterday, Humza Yousaf attempted to distance himself from the legacy of Peter Murrell - today we need to know what the current first minister plans to do to get the SNP's house in order.

"Sunlight is the best disinfectant - we need transparency and openness from the SNP now."

Meanwhile, Scottish Conservative constitution spokesperson Donald Cameron said the SNP should be "fully transparent" over why their auditors decided to quit.

He said: "The public are sick of the SNP shrouding matters relating to their finances behind a wall of secrecy, and senior figures - including Humza Yousaf and Nicola Sturgeon - must be upfront about this situation."

Following the firms resignation, SNP MP for the Outer Hebrides Angus MacNeil, said his party had "to get back to the effective, efficient and open ways" of the Alex Salmond years.

A spokesperson for Johnston Carmichael said: "As a regulated organisation, we adhere to our obligations on client confidentiality and do not discuss client business."