STAFF and students at Stoke-on-Trent College are demanding to know how internal and external audits failed to spot a 20 per cent shortfall in students.
Governors were expected to report last night on the findings of a special committee established two months ago to consider dismissal of senior staff following a damning survey on governance and management at the college.
Since setting up the committee, they have discovered that the college faces an Pounds 8 million debt, built up through overestimating student numbers two years in a row. This will mean nearly 200 redundancies.
The Further Education Funding Council has so far rejected calls to write-off the debt or postpone repayment.
Paul Mackney, Nathfe West Midlands regional official, said: "We are insisting on a fully independent inquiry which must consider whether essential information has been withheld from the governors."
The college failed to make any returns for the year 1995/96 until March, four months after the usual deadline. When these appeared unexpectedly low, it was allowed to resubmit them using a new computer system.
Students have been staging roof-top protests and are lobbying MPs, Gillian Shephard, Secretary of State for Education, and the funding council to help resolve the cash crisis.
The college is now advertising for the post of finance director, which has been empty since the departure of Peter Critchley, in April.
Its principal, Neil Preston, has also been absent since September on long-term sick leave.
College's assistant director Helen Chandler, who has been on sick leave since September, appeared at a licensing hearing in connection with the Dymock Arms in Clwyd, which she owns jointly with Mr Preston.
Ms Chandler told the hearing she had been "extremely ill" and "considerably upset" because of media attention over the last month.