The reality of Patisserie Valerie's financial health was clearly a long way from the position reported to investors and the Board, and this had been the cases for a considerable period. Latest report but the "black hole" at £94 million.
Some of the basic controls must have been absent or subject to management override to hide the scale of the "black hole". Basic Internal Audit testing should in such cases highlight items like high levels of journals, supplier validation checks would identify false invoices.
Management Reporting
We can assist organisation be they private, public or charities to validate their management reporting to ensure the reported position is as supported by source records, performance and other operational metrics.
Verification work can include, but is not limited to:
Accuracy assessment of Income and expenditure figures;
Balance sheet validation;
Reconciliation checking and re-performance;
Review of validity of period end journals;
Period end procedures;
Cash balance validation;
Debtor and creditor balance validation; and
Customer and supplier verification checks.
So if you are have concerns about financial report or budget reporting accuracy at your organisation please contract us for a no obligation discussion. Better to act and find everything is in order, than find a "black hole" and the organisation in financial and reputation peril.