SAN FRANCISCO, Sept 5 (Reuters) - Standard & Poor’s Ratings Services said on Wednesday it suspended its long-term and underlying rating on lease revenue, water and sewer bonds issued by Compton, California due to the lack of an opinion on the city’s 2011 audit.
S&P said in a statement it is also suspending its long-term and underlying ratings on the Los Angeles-area city’s redevelopment agency tax allocation debt.
The credit ratings agency said it is concerned Compton’s most recent audit did not include an independent auditor’s opinion. S&P in July warned that if did not receive sufficient independently audited financial information from the city, it could withdraw or suspend its ratings.
“In addition, the auditors declined to provide an opinion on the city’s redevelopment agency’s audit,” S&P said. “The independent auditors wrote that due to allegations of waste, fraud, and abuse of public monies, as well as a lack of city responses to the auditors’ inquiries, the scope of their work did not enable them to express an opinion.”
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