An Olympic effort – meet the finance team accounting for London 2012’s legacy

Neil Simcock is a project accountant with the interesting role of helping to deliver the promised legacy of the London games.

Britain rose to the challenge of the 2012 London Olympics with great purpose and gusto, investing vast sums of money and a huge collective effort to not only win the right to host the games but see they became a treasured national memory.

While today’s Olympians and Paralympians are beneficiaries of that achievement, away from the competitive arena, there is another legacy to be delivered – to ensure that the area and facilities enjoy a much longer and richer life than previous Olympic games.

Nearly ten years on, the process is still underway and is partly the responsibility of project accountant Neil Simcock and his three-strong team.

Simcock is head of development (finance)  at the London Legacy Development Corporation (LLDC), which was set up in the wake of the London 2012 Olympics and Paralympics to create new residential and commercial units on the Olympic Park and the world-leading project known as East Bank.

Modelled on the South Bank, the £500 million East Bank scheme will house a cluster of museums, academic institutions in what LLDC describes as a new powerhouse for innovation, creativity and learning.

“It’s is a really exciting project and a key part of the Olympic legacy. There will be a new BBC music studio, V&A Museum, a Sadler’s Wells dance theatre and a University of the Arts London (UAL) centre for the London College of Fashion, all sitting side-by-side in the middle of the Olympic Park,” says Simcock.

East Bank takes up most of his time because – in contrast to the housing development – it’s being delivered directly by LLDC.

“LLDC has engaged a specialist project management company to run the project on our behalf. To some extent, my role is assuring what they’re doing. That means things like doing  financial reporting on the project, challenging where required, delivering regular updates to a range of people – LLDC senior management and its board, our future tenants and the GLA.”

One of the persistent challenges of his role as a project accountant is spotting when colleagues have an overly rosy perspective.

“The key issues I’ve seen come down to an optimism bias, with regards to how quickly you think you can deliver a project and how much it’s going to cost. They interlink a little because delays to delivery can create inflation to project management costs.

“The optimism bias around delivery is people aren’t always realistic about how long it’ll take do each task. How long will it take to go through governance, to land your business case, to have your business case approved, to go out to core tenders? Typically, people are over-optimistic about that.

“On the cost side, there tends to be an optimism bias around considering all the risks and issues and allowing for those fully. For example, a typical one is delivering a housing project and the surveys come back and the land is contaminated and it’s going to cost quite a lot of remediate before you can do any work. Obviously, you didn’t know that, but history would suggest you’re going to find those issues. Each individual error is unlikely and rare in its own right, but there’s an awful lot of rare things that can and do happen.”

Although project accountant is a somewhat unusual role, Simcock says it requires a lot of the skills familiar from more general roles. “You can’t ignore the fundamental principles of accountancy. They’re as vital in project accountancy as anything else, P&L, accruals list, cash etc. I also think a lot of the skills are beneficial in management accounting and finance business partnering. That can be things like building effective relationships between stakeholders who have potentially competing priorities as well.

“Where project accountancy differs from these roles is in the complexity and scale of projects. Rather than have a broad-brush overview of a wide number of perhaps low-risk projects, project accountancy is focused on a small number or maybe even one, large-scale and risky project. that means you need in-depth knowledge of all the different tenets of that project and how they interact.”

The recent Tokyo Olympics and current Paralympics have reignited interest in LLDC and the ongoing transformation of Olympic Park.

“The anniversary of the games [also happens next year], but the work has high visibility anyway and the GLA (Greater London Authority) have regular reports and meetings where East Bank is quite prominent. That’s the nature of public sector reporting – it’s all held in public, so certainly there’s ongoing visibility to the project in that sense.”

“East Bank is a large-scale project that’s well over £500 million, and it has a whole host of risks and issues that need to be monitored and mitigated. The bespoke nature of the project, that each building is totally unique, is one of the things that makes it so special. Inevitably that has led to some design, development and integration issues between the various contractors on-site as the design has got more detailed. That’s led to some cost pressures as the project has progressed.”

So far, so good. The London legacy is viewed as probably the best example of how to deliver an Olympic and Paralympic Games sustainably and to plan effectively for the aftermath.

“A key aspect about the Olympic legacy in London has been the successful transition of the venues. Most of them are still in place, and they are used quite actively both by the public and professionals.

“[Take] the Velodrome, for example, you can have a go yourself or go and watch the professionals there. Similarly, the Aquatic Centre – Tom Daley and Matty Lee were training there for Tokyo. You can go and have a go there yourself if you’re minded to. It’s a really prominent example of how to deliver a sustainable legacy.”

Those who are brave enough to follow in Daley and Lee’s wake can book the aquatic centre here. Others who prefer something just a little sedate may choose to wait for the East Bank’s first buildings to open in 2022.

Calum Fuller Calum Fuller is editor of AT and 20 magazines. He's previously served as editor of Credit Strategy, assistant editor Accountancy and began his career at Accountancy Age..