Crisis-hit cake and café chain Patisserie Holdings has now announced it has learnt the company’s finance director, Chris Marsh, who is currently suspended from his role, has been arrested by police and released on bail
The news comes at the end of a tumultuous few days for the company, which started with the initial announcement of the shock discovery of ‘significant, potentially fraudulent, accounting irregularities’.
This was followed by a further statement that it had also discovered a winding up order against the company brought by HMRC over a £1.4m tax bill.
This led the company to state: ‘Without an immediate injection of capital, the directors are of the view that that is no scope for the business to continue trading in its current form.’
Marsh, who qualified as an ICAEW member with Vantis (formerly Morton Thornton) and also qualified as a chartered tax accountant with EY, joined the group as finance director in 2006. His previous experience included finance director roles at two AIM quoted companies, Fishworks and Healthy Living Centres.
In July this year, Marsh exercised share options under a long-term incentive plan which saw him realise around £700,000.
Patisserie Holding’s auditor is Grant Thornton. In the 2017 annual report and accounts, there were no material concerns cited and no qualification of the accounts.
However, the auditor’s report stated: ‘Due to the nature of the business and the volume of cash transactions, there is a risk that cash is misappropriated or cash sales are not recorded. The group has multiple revenue streams, with revenue received from wholesales, online sales, vouchers and third party funded discount schemes. As a result, revenue recognition has been identified by the audit team as a significant risk, which was one of the most significant assessed risks of material misstatement.’
A spokesperson for Grant Thornton UK said :'We are aware of the news released by Patisserie Valerie. Given our duty of client confidentiality it would be inappropriate for us to comment.'
Report by Pat Sweet