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In a statement filed with the London Stock Exchange, SFI said it believed the aggregate of overstated current assets and understated liabilities would exceed £20m.
SFI said the accounting treatment of these assets and liabilities was now under review, while an overall review of the group’s financial position – began on 21 October by group FD Tim Andrews with the assistance of PricewaterhouseCoopers – continues.
Revised accounting procedures and policies ‘designed to prevent a recurrence of the misstatement of assets and liabilities of the group’ are currently being implemented by the Board, the company said.
The company also admitted that its cash flow estimates at the time of the acquisition of Parisa Caf‚ Bars in November 2001 was over optimistic and were actually £10m in excess of those actually reported in the financial year ending 31 May 2002.
In addition to the financial review, a full strategic review is now being conducted by CEO Andrew Latham, also with the assistance of PwC.
Shares have been suspended pending the outcome of the two reviews and clarification of its financial position.
Steve Absolom and Will Wright from KPMG Restructuring have been appointed joint administrators to City Motor Holdings and associated companies
Partners from Johnston Carmichael have been appointed as joint administrators to Axon Well Interventions Products UK
Begbies Traynor have been appointed administrators of William Anelay Ltd, York, one of Britain’s longest-established construction and heritage restoration companies
Smith & Williamson has been appointed administrators of charity 4Children