Versailles, which was put into receivership last week by PricwaterhouseCoopers, called in Baker Tilly following a report by Levy Gee which revealed problems over compliance with FRS 5, which governs off-balance sheet financing.
An insider said that in the course of trying to find the true figures of the company’s turnover, two separate books had been found, allegedly representing UK and non-UK residents.
But he said that there was ‘no adequate explanation’ for the existence of two accounting systems, and the money was either in the company’s systems, or ‘it was deliberate stonewalling’.
Baker Tilly was due to publish its findings at the end of this month, but has now passed it’s the information on to the SFO. The firm worked alongside PwC during part of its investigation.
The source said that PwC will now have a tough job in its hands to find out who exactly owes Versailles money and who needs to be paid.
PwC insolvency partner Tony Lomas, is one of two partners working on Versailles. He said: ‘This was a significant public company which had very little qualified accounting resource and the fraud took some covering up in the books.’
Lomas said that the firm had already had a number of enquiries from potential buyers and it will only be a short time until PwC decides whether to sell the business or continue the work in the progress itself.
PricewaterhouseCoopers appointed administrative receivers to fraud-hit trade finance company VersaillesKPMG’s investigation at Versailles ends in controversy