On most of the stuff, I'd agree with you - but the stock control issues (plus the line regarding recording sales outside of cycle) are a little puzzling.
It was not a minor restatement either. GBP$1m is pretty material.
Don't think this is a fraud, but they have some serious internal control issues. We will see how much relatively soon, since a new CFO is in place.
Hi DHC, there is that old saying " there is no smoke without fire" ... it seems to me that some mistakes were made, no doubt about that. But the previous auditor ( very thorough and demanding) still signed off the accounts, so I'm thinking not material enough. I think the valuation reflects all of that already.
I'm with you, generally, and think this is more a q of how poor internal controls were vs this being a fraud, but I am not sure if relying on auditor sign off is the best. Auditors have a pretty poor track record when it comes to signing off on fraudulent accounts.
Maynard, your input is appreciated. Unbelievable forensic detail, as with other pieces as well. So it's great to have your opinion even if it differs to mine.
Any update on cakebox from yourside?
On most of the stuff, I'd agree with you - but the stock control issues (plus the line regarding recording sales outside of cycle) are a little puzzling.
It was not a minor restatement either. GBP$1m is pretty material.
Don't think this is a fraud, but they have some serious internal control issues. We will see how much relatively soon, since a new CFO is in place.
Hi DHC, there is that old saying " there is no smoke without fire" ... it seems to me that some mistakes were made, no doubt about that. But the previous auditor ( very thorough and demanding) still signed off the accounts, so I'm thinking not material enough. I think the valuation reflects all of that already.
I'm with you, generally, and think this is more a q of how poor internal controls were vs this being a fraud, but I am not sure if relying on auditor sign off is the best. Auditors have a pretty poor track record when it comes to signing off on fraudulent accounts.
Yes, only time will tell. Let's see. As I noted in the article, I may have been overly sceptical. Maynard
Maynard, your input is appreciated. Unbelievable forensic detail, as with other pieces as well. So it's great to have your opinion even if it differs to mine.